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TPL Insights: Building Peak-Performance Cultures #140 – The Principles of Peak Performance Cultures Explained

October 13, 2022

By  

Rob Andrews

By Rob Andrews with content from the original article So What is Total Performance Leadership published in August 2014

Much of what I write these days is responding to a specific client request. One of my clients asked me for an updated explanation of the principles, which were published originally in 2014, why each one matters, and how she would know if she was getting close to mastery.

1. High Performance Mindset: Leaders and organizations have mindsets that drive behavior and determine results. Individual and collective mindsets often include limiting beliefs embedded in the subconscious. A peak performance mindset can be developed through training, coaching, and a neuroscientific process by which limiting beliefs are identified and then overwritten by enabling beliefs. Properly trained leaders routinely accomplish what most consider impossible. Leaders with high performance mindsets see possibilities that previously eluded them. They lead with confidence, own their results, never make excuses, never take success for granted, and continuously push for improvement. We have found high performance mindsets in every organization we’ve studied that performs at the very top of its sector.

Why it Matters: Regardless of how good you and your organization are, an optimizing mindset will unlock the true potential of your business. Without a high-performance mindset, your potential is unnecessarily limited.

How You Can Tell if You Have It: You routinely accomplish what most can’t. You often set goals you know you can accomplish but don’t yet know how. You lead your sector or are rapidly approaching its top spot. Your leaders are bold yet humble, take all responsibility for their failure, and give all the credit to their teams. Your leaders are trained not to articulate that which they don’t wish to bring into existence. Your frontline supervisors and employees own their own results and ensure they are aligned with senior leadership.

2. Disciplined Human Capital Practices: Hiring practices worldwide at every level are broken. Following proven, time, and battle-tested ForesightTM hiring processes at every level ensure screening out B- and C players in favor of A-players and aligning the right players around cultural fit, personal and professional attributes, and performance expectations than enable peak performance. Disciplined Hiring begins with your employment brand, which drives your candidate funnel, determines how you engage candidates, assess them for culture fit and performance, onboard them, put them on a career track, train, develop and reward them. It’s a holistic approach that can be measured and managed.

Why it Matters: Disciplined human capital practices ensure that your organization is built by design and that each position in your company is staffed with the top 10% of talent available. You have zero marginal employees.

How You Know You Have It: Your employment brand is so strong you have a waiting list of high-quality people waiting to join you. You are engaging potential employees around purpose, mission, vision, values, and strategy. Every person in your organization knows exactly for what they are responsible and how they fit into your overall strategy. Everyone has a career track and is crystal clear about how they are evaluated, rewarded, and promoted. You are the envy of your peers and your competitors are trying to emulate your practices.

3. Unified Leadership: Most leadership teams are not teams at all, but rather a collection of individuals who often compete for position, airtime, and resources. A peak-performing organization is a team of teams, from top to bottom, where trust, healthy debate, shared vision, accountability, and a results orientation mindset exist to achieve a culture of peak performance. Transforming a group of talented individuals into a unified team takes work, process, patience, and commitment. The results are well worth the effort.

Why it Matters: Great leadership is a critical element of a culture that attracts and retains great talent. Disjointed or misaligned leadership causes confusion, dysfunction, and loss of confidence and momentum.

How You Know You Have It: Unified leadership can be measured and manifests itself on the front lines. When middle managers and front-line employees are aligned with senior leaders, they can recite chapter and verse what the leadership team is up to, how they fit in, and what’s in it for them. Front-line supervisors and employees are enabled and empowered to act on behalf of senior leadership to carry out the company’s purpose. There is clear evidence of front-line supervisors managing up the chain to ensure alignment.

4. Leading with Purpose: Less than 5% of organizations operate with a clear sense of purpose. Harnessing the power of purpose makes inspiring stakeholders and delivering exceptional returns possible. Purpose-driven companies like QuikTrip, Southwest Airlines, H-E-B, Raley’s, and Nordstrom engage their workforces, especially millennials, with a purpose greater than just making money. One powerful example of the power of purpose is Alcoholics Anonymous, which serves over 2.5 million members on every continent, with wildly different socioeconomic, ethnic, political, and generational backgrounds. AA has no corporate hierarchy, and yet it runs like a finely tuned Swiss watch. People who would not otherwise mix are united with a common purpose, to stay sober and carry the message to the alcoholic who still suffers.

Why it Matters: Purpose is the great multiplier. Uniting your organization around a core purpose with a subordinating mission, values and strategy is what allows peak performers to achieve true diversity and inclusion.

How You Know You Have It: Your purpose drives everything: mission, values, and strategy. You constantly look to your purpose as your north star. Day-to-day work is meaningful as passion around purpose energizes your people at all levels. Measurable objectives and key results are focused on achieving your overall purpose. You’re constantly innovating and exploring better ways to achieve your purpose. It is on the tongues of everyone in your company.

5. Stakeholder Engagement: It is impossible to achieve peak performance without engaging all stakeholders. Fulfilled, collaborative employees who are committed to a great customer experience and achieving the company’s objectives need the support of management, shareholders, and service providers. Pre-pandemic, Gallup reports the American and Global workforces are 66% and 85% disengaged, respectively. The best performing organizations in the world deliver a great employee experience and have all their employees working hard towards the organization’s objectives. The right values, vision, mission, strategy, and big, hairy audacious goals are necessary for stakeholder engagement.

Why it Matters: Organizations that engage their shareholders, employees, managers, senior leadership, providers, and the community are loved, which translates into loyalty, passion, and a healthy corporate ecosystem.

How You Know You Have It: You think win-win when it comes to your providers, rather than trying to squeeze every dime out of them. You keep your shareholders involved and informed but not at the expense of other groups. Your supply chain conversations revolve around solutions that benefit all stakeholder groups. Your employees are treated with the same level of dignity and respect with which you treat your board and senior leaders. You routinely consider your actions and how they affect the communities in which you operate.

6. Clarity in Everything: Stakeholders understand the company’s strategy, know where the organization is going, how it will get there, and their role in making it happen. Clarity is necessary to engage all your stakeholders, including your providers and customers. In organizations with great clarity, communications are delivered so constituents believe that their leaders know where they are going, believe what they are saying, and are connecting effectively with their needs and desires. Achieving organizational clarity requires the right mindset and a formula for communicating through layers of management and remote offices and employees.

Why it Matters: The devil is in the details. Communicating and achieving clarity enables front-line employees to execute flawlessly. Driving clarity up the chain of command allows senior leaders to make better and faster decisions. Leaders in peak-performing organizations have built cultures in which every employee takes responsibility for operating with clarity.

How You Know You Have It: Everyone in your organization knows who your customer is, what makes you special, and your strengths, weaknesses, opportunities, and threats. Everyone understands where you’re going, what’s expected of them, and why they are important in achieving the overall objectives. Front-line employees and managers take responsibility for understanding senior leaders’ instructions, staying aligned, and for keeping them informed.

7. Customer Experience: World-class customer experience must be engineered deliberately. Delivering a great customer experience, so compelling that customers tell stories and evangelize for the organization is key. It is about relentless customer commitment, anticipating their needs, and creating raving fans. It is not about reducing defects and it is not just good customer service. It’s emotional and subconscious. Organizations that deliver a consistently compelling customer experience don’t leave things to chance.

Why it Matters: The cost of losing just one customer can easily be hundreds of times the amount of the transaction that caused the defection. The lifetime value of a restaurant customer can and often does exceed $100,000. Raving fans are any company’s best sales and marketing asset.

How You Know You Have It: Everyone in your organization fully understands the lifetime value of every customer and is enabled to do what it takes to keep customers. Your customers keep coming back and are your best brand ambassadors. Everyone in your organization is focused on serving the customer or those who do. Your entire team is passionate and relentless in its pursuit of a flawless customer experience.

8. Measure What Matters: Measuring what matters requires measuring all the critical elements of peak performance, such as financial metrics, leadership effectiveness, employee engagement, and customer delight. Measuring the overall health of your culture is one of the most important metrics and one of the most often overlooked. Spending time to develop the right measurement systems to assess the health of your stakeholder relationships is every bit as important as your financials. Leaders today are inundated with data. Take care to focus on the most important metrics. If everything is important, nothing is.

Why it Matters: Optimizing shareholder returns requires more than reading financial statements, which are largely backward-looking. The quantitative bias promoted by modern-day business methods and schools often miss the most important metrics.

How You Know You Have It: Your leaders are not infected with quantitative bias. You spend just as much time and effort measuring and managing the qualitative contributions of your associates as their quantitative contributions. Measuring the engagement and commitment of all your stakeholders is a way of life. Your metrics make sense to all your associates and they have no problem connecting the dots and understanding why you measure the things you do.

9. Cost Leadership: Remove it where the customer can not feel it. Peak performers remove as much cost as possible, being very careful not to affect the customer and employee experiences. Southwest Airlines, H-E-B, QuikTrip, and Koch Industries do it extremely well by removing costs from the supply chain, building costs, and employee turnover. Top-performing companies do not take cost out of the business by removing services and benefits from customers and stakeholders. True cost leadership requires an industrial engineering mindset and a process driven by purpose, mission, vision, values, and strategy.

Why it Matters: Optimizing performance and profitability ensures your organization’s financial health and enables the fulfillment of its purpose. Extraneous expenses have no place in peak-performance organizations.

How You Know You Have It: Everyone in your organization has a cost containment mindset and works hard to extract costs without negatively affecting the customer and/or employee experience. You routinely benchmark your costs against your best-performing competitors. You work cooperatively with your vendors and providers to negotiate win-win deals that reduce costs for both parties. You spend wisely while making important investments in culture, people, technology, and capital equipment that add real value to the enterprise.

Ok, that’s an update for October 2022. It is often said that we teach best that which we need to know ourselves. I sincerely hope this update has been as helpful for you to read as it has been for me to write. We look forward to hearing from you and being your thought partner.

Warmest Regards,

Rob

Rob Andrews
Allen Austin
Consultants in Retained Search & Leadership Advisory

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