Abstract: Improving Britain’s competitive position
Many organisations in Britain struggle with the sustainability of their performance. Having come out of the worst recension since the 1920s
they have been busy rebuilding their companies. However, many of these companies might have come from being a low performing organisation to now being an average performing organisation but how do they become and stay a high performing organisation (HPO)? There have been many publications on HPO but none of these have led to a unified theory, model or framework which has been proven in practice. Based on an extensive literature review and practical research, taking ten years, a generically valid HPO Framework was developed that can help British organisations to improve their performance and through this their competitive position. The application of the HPO Framework is illustrated with research data obtained from UK organisations.
Setting the scene
Looking up from the latest financial statement, the CEO heaved a deep sigh of relief. Only having taken over the company four years ago and pulling it away from the brink of disaster, it had been touch-and-go for a few years. Bringing in a new management team, ousting quite a few of the old-timers, moving to a new location, and securing new financing from the shareholders had clearly done the trick as could be seen in the statements. Revenue had gone up considerably and, although profits had not risen at the same pace, the prognosis for the rest of the year looked better than it had done in years. However another report, the employee engagement survey, told a different tale. Engagement had gone up the last year but had now taken a dive, with many employees complaining about the lack of support they got from their managers and the fact that they felt that management did not involve them enough in the organisation’s processes. A telling quote in the report caught the eye of the CEO: “I believe we are a great organisation and have come a long way in the past year. I do however think that we are struggling with the growth and staffing levels are not correct yet. We are an organization with great people but limited tools. Emphasis is on growth in sales and technological capabilities, but not enough on improving internal processes and resources that enable us to adapt to the growth. Too many of our projects get delayed or downright fail. And with such a high number of new starters a disproportionate share of the burden falls on a handful of key employees, many of which are breaking under the strain.” The CEO sighed once more but this time from frustration. He had tried all kinds of improvement tools and techniques but apparently nothing had really stuck. With increasing trepidation he was thinking to himself: “Getting out of a mess and then aiming for the top is one thing, but how do I makes sure I stay there? How can I be certain that we fulfil our potential and make our bright future a reality in a profitable way, with everybody happy?”
The High Performance Organisation Framework
The CEO in this story is by no means alone in his worries. Many organisations in Britain struggle with the sustainability of their performance. Having come out of the worst recension since the 1920s they have been busy rebuilding their companies and are now finally seeing an appealing future before them. However, many of these companies might have come from being a low performing organisation to now being an average performing organisation but how do they become and stay a high performing organisation (HPO)? After all, many sports people will tell you: “It isn’t that difficult to get the top, but staying there sure is.” It therefore does not come as a surprise that many managers turn to the field of the high performance organisation (HPO), to find ideas which will help them strengthen their organisations. The HPO is defined as “an organisation that achieves financial and non-financial results that are exceedingly better than those of its peer group over a period of time of five years or more, by focusing in a disciplined way on that what really matters to the organisation” (de Waal, 2012).
There have been many publications on HPO but none of these have led to a unified theory, model or framework which has been proven in practice. Based on a literature review of 290 academic and practitioner publications on high performance I did develop a generically valid HPO Framework. For each of the 290 studies those elements that the authors indicated as being important for becoming a HPO were identified. For each of the potential HPO characteristics the ‘weighted importance’ was calculated, i.e. the number of times that it occurred in the studies. The characteristics with the highest weighted importance were selected as potential HPO characteristics, which were subsequently included in a survey which was administered worldwide and which encompassed more than 3200 respondents. In this survey the respondents were asked to indicate how good they thought their organizations were performing on the HPO characteristics (on a scale of 1 to 10) and also what their organizational results were compared to their peer group (choices: worse, the same, or better). By performing several statistical tests, 35 characteristics which had the strongest positive correlation with organizational performance were extracted and identified as the HPO characteristics. These characteristics grouped into five factors with the expected correlation: high-performing organisations score higher on the five HPO factors than organisations with lower performances. This means that organizations which pay dedicated attention to strengthening these factors achieve better results than their peers, in every industry, sector and country in the world.
These are the five HPO factors are…