Performance Management

As Europe’s economic fortunes plummet, effective management of your service business becomes integral to ensuring profit. Amidst increased pressure to deliver a mature service capability, the financial status quo provides the opportunity to review your modus operandi and embrace powerful new incentives to enact a total service transformation. Without good leadership however, new initiatives tend to veer off track. Leadership is, more often than not, the major differentiating factor in a company’s level of success. The question becomes: What makes a successful leader in the services and how do you lead your company to profitable growth? At Noventum, our consultants have defined four priorities to first-rate service leadership; a good Strategy, focus on the Customer Experience, attention to the virtues of (what we call) the Service Factory, and developing your Employees’ skills and understanding. These considerations will be addressed in the upcoming Service Management Conference and through our executive Service Leadership Course.

The current rapidly changing environment demands much greater reliance on the quality and calibre of individuals for example  developing engineers as trusted advisors; beyond requiring that they adapt to technology and activity management, and the expectation that mobile solutions will provide effective command and control to support structure and processes.  Managing activities is important when productivity and cost reduction are in focus, and strong leadership will be necessary to ensure that, delivery of leading-edge service achieves all its objectives across a wide range of measures to include customer loyalty, engineer loyalty, process quality and deployment, as well as cost constraints.

A significant challenge for many service organisations is to improve the capability of their managers and staff; this is not simply a training issue, and acknowledging a lack of capability does not necessarily reflect poor or limited training, but is a more complex issue which companies are having to get to terms with in order to grow cost-effectively while retaining existing and seeking out new customers.

Recently a group of senior executives and directors gathered together at the Service & Maintenance Congress 2011, in the Netherlands, where they had the opportunity to debate key challenges around staff and powerful people performance.

As Marco van Duijnhoven, Director, SSCD Europe Cisco said:
"Having a strong brand is a good start to attract talent, but competing for talent in the current market place will require more than that. What is it you have to offer as a company that will help you Attract, Retain and Develop the talent for the future?"

As Jos Bulter, Service Manager Consumer Production Miele said:
"The personal properties (such as communication and attitude) that suits our Brand have become more critical than the technical skills. Nevertheless the level of their technical skills are still the same."

Their best staff are: Trusted Advisors - because they can provide customers, colleagues and managers with good advice and powerful support; they know their customers, they are commercially aware and are very good communicators. 

How does your top team measure up with other best-in-class organisations? Complete your own sample assessment and see how simply it demonstrates your areas of strength, and areas for development.

Assess your team now by taking the sample Competence Assessment framework. The url link will then be sent to your email address. The results of the assessment will give you a clear indication of how your team fairs with other top teams. Noventum will be happy to discuss your people performance needs and can work with you to raise the calibre of your teams.

Mergers and Acquisitions (M&A), are they an effective approach to value creation?

The main purpose of M&A is to add value to shareholders, based on the assumption that to merge or make an acquisition will produce higher corporate potential value than the value of the two separate companies.

The logic is quite simple: Companies can benefit from combining the two companies in fixed cost reduction available from economies of scale. Most examples involve purchase of a competitor; or companies in similar core activities, however, evidence from different source, highlights that only one in three M&A deals achieves the expected increased corporate value. Recent research reveals results were even worse in Europe: in the last three years, less than one in ten transactions can be considered successful.

The service industry has experienced a shift of emphasis, with efficiency considered as an absolute, and with much more attention paid to the effectiveness of the operation. Support staff are beginning to accept tighter management techniques, and convincing them that such changes improve their effectiveness is instrumental in aiding the business, accompanied with a move from “Time and Materials” to more “Contractual” work, which in turn has introduced the need for Service Level Agreements (SLAs) to provide a structure for performance, and expectation of delivery in the contract.

Performance measurement is generally used to control and increase the performance of employees. Unfortunately, performance measurement does not always work out as planned. Therefore, Noventum Service Management in collaboration with the University of Twente, will investigate how performance measurement leads to better results of service employees. We are specifically focusing our research on the importance of employee involvement in designing the performance indicators for measurement of their performance.

Does your company use individual or group performance indicators to measure the performance of service employees? Would you like to learn how performance measurement can be done more effectively? Then we invite you to participate in this interesting research. We really value your contribution to our research and we will be delighted to send you a copy of the research results in return. These results may give you new insights on how performance measurement of employees can be improved to maximize the output of your employees and enhance service excellence and profits within your organisation.

 This article considers successful companies and their emphasis on combining effective service management and operational excellence to transform their operation.

Increasing the focus on, and improving the delivery of, service is a major reason why leading businesses are achieving growth and profit improvement in an environment where some are experiencing little or no growth, and unpredictable revenues and shrinking margins. Leading edge businesses have recognised and responded to the benefits of emphasising the strategic role of their service, and understood the need to think in terms of linking product and customer, to achieve significant revenue and profit growth.

Service Management has become an extremely complex function that is recognised as more than just an extension of logistics or scheduling, because it has to create order within the various complex supply chains that have been woven together to form intricate networks. There is a recognisable challenge for the business to balance the demands of such a network while generating revenue, reducing costs and ensuring effective consistent fulfilment, in an ever-demanding environment where the customer has assumed sovereignty.

Steve Downton, Downton Service Management Consultants Ltd, Noventum Group

Recent research applying the results from a benchmark review has shown that the strategy adopted by the service operation impacts significantly upon the revenue and margin performance of the business as a whole.

Steve Downton, Downton Service Management Consultants Ltd, Noventum Group

Recent research applying the results from a benchmark review has shown that the strategy adopted by the service operation impacts significantly upon the revenue and margin performance of the business as a whole.

In addition the research confirms that success comes from constructing a successful strategy and delivering it into an effective operation, creating loyal, satisfied customers, while strongly growing revenue and profit. However the benchmark aspect of the research also confirms that establishing an operation that best delivers the business strategy is a major challenge, but when successfully accomplished is shown to deliver a handsome financial reward. Finally, the research highlighted that in the current economic climate, there is a great need to optimise existing solutions and generate as much value as possible from what is already in place.

Measuring performance is all well and good, but controlling performance and managing customers through accurate information is the best stance for successful service and business management. In this article Steve Downton discusses how many service operations are struggling to obtain data about their operation to measure success against Service Level Agreements (SLAs), let alone manage their operation by the use of accurate and timely information.