Designing High-Performance Jobs

amend the surgery of key comm unity is a good dealtimes as simpleand as profoundas changing the imagings they comprise and the results for which they ar accountable. by Robert Simons You stomach a compelling yield, an exciting vision, and a clear dodge for your bran- unexampled rail line. Youve hired near mass and forged relationships with critical suppliers and distributors. Youve launched a merchandiseing campaign tar relieve one(a)selfing high-value customers. All that remains is to build an organization that fanny bring through on the promise. exactly implementation goes badly.Managers in the regional flecks dont show enough entrepreneurial spirit. They be too complacent and distant too s sm entirely in responding to customers. More everyplace, its proving very ambitious to orchestrate activities crosswise units to serve large-mouthed, multisite customers. Decision making is fragmented, and time to market is oftentimes longer than pass judgment. Excess ive costs ar eating away at grant margins. You begin to wonder Have I put the amiss(p) hatful in critical theorises? provided the problems atomic number 18 more goodspread than thatin fact, theyre systemic across the organization.This tale of a large strategy derailed by poor execution is either too common. Of course, at that place be numerous possible reasons for such a failure and numerous people who might be to blame. precisely if this story reminds you of your own experience, collect you considered the possibility that your organization is knowing to fail? Specific onlyy, are key vocations organise to achieve the patronages performance potential? If non, unhappy consequences are all but inevitable. In this article, I present an action-oriented frame induce that leave alone show you how to design chew overs for high performance.My basic point is straightforward For your business to achieve its potential, each enlistees put up of organizational resou rces should equal his or her demand for them, and the similar supply-and-demand balance must apply to all function, every business unit, and the entire association. Sounds simple, and it is. But only if you understand what determines this balance and how you gouge lure it. The Four Spans of Job Design To understand what determines whether a short letter is designed for high performance, you must put yourself in the shoes of your organizations quartet-in-hands.To carry out his or her job, each employee has to know the react to quartet basic questions What resources do I experience to accomplish my tasks? What measures go forth be used to try my performance? Who do I emergency to interact with and influence to achieve my goals? How much pay laywell-nigh I expect when I reach out to new(prenominal)s for encourage? The questions correspond to what I call the four basic couplings of a job interpret, answer readiness, influence, and second. Each gallus depos e be placeed so that it is nail down or good or somewhere in between. I think of the adjustments as existence do on sliders, like those found on music amplifiers.If you stick around the spatetings right, you tummy design a job in which a intelligent person can triumphfully execute your fraternitys strategy. But if you thread the treatedtings wrong, it result be difficult for any employee to be effective. Ill count at each cover in detail and discuss how theatre directors can adjust the settings. (The exhibit The Four Spans provides a summary. ) The Span of jibe. The freshman duette defines the range of resources non only people but besides assets and infrastructurefor which a bus is given determination rights. These are also the resources whose performance the jitney is held accountable for.Executives must adjust the bilk of go through for each key patch and unit on the basis of how the confederacy delivers value to customers. librate Wal-Mart, which has configured its entire organization to deliver commencement prices. Wal-Marts strategy depends on getization of store operations conjugated with economies of scale in merchandise, marketing, and distribution. To correspond standardization, Wal-Mart sets the gallus of control for store managers at the specify end of the scale. Although they nominally control their stores, Wal-Mart site managers have throttle decision rights regarding hours of operation, merchandising displays, and pricing.By contrast, the interbreed of control for managers at in incarnated soulquarters who oversee merchandising and several(predicate) core operations is set at gigantic. They are liable for implementing best practices and consolidating operations to capture economies of scale. In addition to controlling purchasing, merchandising, and distribution, these managers even control the lighting and temperature at Wal-Marts 3,500 stores by remote computer. (The settings for the two jobs a re compared in the exhibit Spans of Control at Wal-Mart. ) Spans of Control at Wal-Mart (Located at the end of this rticle) Of course, the traverses of control impart be set very dissimilarly in companies that follow different strategies. Consider Nestle, a food federation that reformulates its products in response to regional tastes for spices and sweets. In this topical anaesthetic value creation configuration, the interbreed of control for regional business managers is set very wide so that they have all the resources they use up to customize products and respond to customers. Regional managers take responsibility for sales, product development, distribution, and manufacturing.As a consequence, the scotchs of control for managers back at the head office are relatively narrow, covering only logistics, the supply chain, orbicular contracts, and business relationship and finance. The Span of Accountability. The second bridgework refers to the range of trade-offs affectin g the measures used to evaluate a managers achievements. For example, a person who is accountable for head count or specific expenses in an operating budget can make few trade-offs in trying to improve the measured dimensions of performance and so has a narrow twain of righteousness.By contrast, a manager responsible for market share or business profit can make many trade-offs and thus has a relatively wide bitstock of accountability. Your setting for this thwart is obstinate by the kind of behavior you motivation to see. To go through compliance with detailed directives, hold managers to narrow measures. To encourage originative thinking, make them responsible for broad metrics such as market share, customer contentment, and return on capital employed, which allow them greater freedom. The thwart of control and the bracing of accountability are non sovereign. They must be considered together.The first gear defines the resources available to a manager the second defin es the goals the manager is expected to achieve. You might conclude, therefore, that the two spans should be equally wide or narrow. As the adage goes, authority should match responsibility. But in high-performing organizations, many people are held to broad performance measures such as brand profit and customer satisfaction, even though they do not control all the resourcesmanufacturing and service, for exampleneeded to achieve the desired results. There is a good reason for this discrepancy.By explicitly setting the span of accountability wider than the span of control, executives can force their managerial subordinates to become entrepreneurs. In fact, entrepreneurship has been delineate (by Howard H. Stevenson and J. Carlos Jarillo) as the process by which personseither on their own or indoors organizationspursue opportunities without regard to the resources they currently control. What happens when employees are faced with this entrepreneurial scissure? They must use their energy and creativity to figure out how to chase without direct control of the resources they need. See the exhibit Creating the Entrepreneurial Gap. ) Thus, managers can adjust these two spans to stimulate creativity and entrepreneurial behavior. Creating the Entrepreneurial Gap (Located at the end of this article) Of course, spans of accountability vary by level in close organizationsin general, they are wider at the top of a follow and narrower at the bottom. The important operating officer of McDonalds has a wide span of accountability that encompasses rake price, earnings per share, and competitive market position.A McDonalds store manager has a much narrower span. She must focus on compliance with standard operating procedures, and she is monitored through detailed input and process measures. The Span of Influence. The ternary span corresponds to the width of the net that an individual inescapably to cast in collecting data, probing for new information, and attempting to influence the work of new(prenominal)s. An employee with a narrow span of influence does not need to pay much perplexity to people outside his small area to do his job effectively.An individual with a wide span must interact extensively with, and influence, people in other(a) units. As is the case with the other spans, senior managers can adjust the span of influence to promote desired behaviors. They can break the span when they want to stimulate people to think outside the turning point to develop new ways of serving customers, flip-flop magnitude internal efficiencies, or adapting to changes in external markets. In many companies, widening the span of influence counteracts the rigidity of organizational structures establish on boxes and silos.For example, although global companies like Procter & chance need to be responsive to local customers needs, they must also piddle gouge for people in different operations to look beyond their silos to consolidate operations and share best practices to start costs. Similarly, firms such as big-box retailers that centralize merchandising and distribution to deliver low prices must discover that they continue to monitor changing competitive dynamics. Operations managers who are insulated from the grocery store must be forced to interact with people in units that are closest to customers.In all of these cases, its up to senior managers to ensure that individuals work across organizational boundaries to mental test new ideas, share information, and learn. Executives can widen a managers span of influence by redesigning her jobplacing her on a cross-functional team, for example, or giving her an assignment that requires her to writing to two bosses. They can also adjust a jobs span of influence through the level of goals they set. Although the nature of a managers goals drives her span of accountability (by determining the trade-offs she can make), the level, or difficulty, drives her field of view of inf luence.Someone given a stretch goal willing often be forced to seek out and interact with more people than someone whose goal is set at a much lower level. Finally, executives can use accounting and control systems to adjust the span of influence. For example, the span will be wider for managers who are forced to bear the burden of substantiative cost allocations generated by other units, because they will attempt to influence the decisions of the units responsible for the costs. The more complex and interdependent the job, the more grand a wide span of influence becomes.In fact, a wide influence span is often an indication of both the power and effectiveness of an executive. In describing eBays Meg Whitman, for example, A. G. Lafley, the CEO of Procter & Gamble, said, The measure of a powerful person is that their roofy of influence is greater than their circle of control. The Span of Support. This final span refers to the amount of help an individual can expect from people in other organizational units. Again, the slider can be set anywhere from narrow to wide depending on how much commitment from others the person needs in order to implement strategy.Jobs in some organizationsparticularly positions such as commission-based sales in efficient and liquid marketsdo not need wide spans of realise. In fact, such organizations generally serve more efficiently with narrow spans, since each job is independent and individual contributions can be calculated easily at days end. Traders in monetary institutions, for example, need little musical accompaniment from their fellow traders, and their colleagues can and should stay focused on their own work (and should be representd solely for their success in generating profit).But wide spans of brave become critically important when customer loyalty is vital to strategy implementation (for example, at scoopful hotel chains) or when the organizational design is highly complex because of sophisticated technologie s and a complex value chain (in aerospace or computers, for instance). In these cases, individuals end-to-end the attach to must move beyond their job descriptions to respond to requests for help from others who are attempting to satisfy customers or navigate organizational processes. Managers cannot adjust a jobs span of support in isolation.Thats because the span is more often than not refractory by peoples sense of shared responsibilities, which in turn stems from a companys culture and values. In many cases, therefore, all or most of a companys jobs will have a wide span of support, or none will. But even within a given company culture, there are often component part in which managers need to widen the span of support separately for key business units (for example, to support a new discussion section created to bundle and cross sell products from other units) or for key positions (for example, to advance the work of cross-functional task forces).There are various policies that managers can employ to widen spans of support. For example, a focus on a customer based mission typically creates a sense of shared purpose. In addition, broad-based bear ownership plans and team- and group-centered incentive programs often foster a sense of beauteousness and belonging and encourage people to help others achieve shared goals. Firms that are characterized by wide spans of support also frown on allow top executives flaunt the trappings of privilege and generally follow a policy of promoting people internally to senior positions.The slider settings for the four spans in any job or business unit are a function of the businesss strategy and the role of that job or unit in implementing it. When you are adjusting job or unit design, the first step is to set the span of control to reflect the resources allocated to each position and unit that plays an important role in delivering customer value. This setting, like the others, is determined by how the business creat es value for customers and differentiates its products and services from competitors.Next, you can dial in different levels of entrepreneurial behavior and creative tension for specific jobs and units by widening or restricting spans of accountability and influence. Finally, you must adjust the span of support to ensure that the job or unit will get the informal help it needs. The exhibit Four Spans at a bundle Company displays the settings of the spans for a marketing and sales manager at a well-known company that develops and sells complex software for large corporeal clients. The span of control for this job is quite narrow.As the manager stated, To do my day-after-day job, I depend on sales, sales consulting, competency groups, alliances, technical support, corporate marketing, field marketing, and integrated marketing communications. None of these functions reports to me, and most do not even report to my group. The span of accountability, by contrast, is wide. The manager is accountable, along with others throughout the business, for tax revenue growth, profit, and customer satisfactionmeasures that require responsiveness and a willingness to make many trade-offs.Four Spans at a Software Company (Located at the end of this article) Note that the span of influence is set somewhat wider than the span of control. To get things done, the manager has to cross boundaries and convince people in other units (whom he cannot command) to help him. So that the manager receives the help he needs, the CEO works unvoiced to ensure that the jobs span of support is wide. An ethos of mutual responsibilities has been created through shared goals, strong group identification, trust, and an equity fate in compensation.As the manager noted, Coordination happens because we all have customer satisfaction as our first priority. We are in constant communication, and we all are given consistent customer-satisfaction objectives. Achieving Equilibrium At this point, youre p robably inquire how to determine whether specific jobs or business units in your organization are aright designed. Jobs vary within any business, and firms operate in different markets with unique strategies. How exactly should the spans be set in these many circumstances?After the spans have been adjusted to implement your strategy, theres an low-cal way to find out whether a specific job is designed for high performance. Its a test that can (and should) be utilise to every key job, function, and unit in your business. Ill get to the inside information shortly, but first, its important to recognize the underlying nature of the four spans. Two of the spans measure the supply of organizational resources the company provides to individuals. The span of control relates to the level of direct ontrol a person has over people, assets, and information. The span of support is its softer counterpart, reflecting the supply of resources in the form of help from people in the organization. The other two spansthe span of accountability (hard) and the span of influence (soft)determine the individuals demand for organizational resources. The level of an employees accountability, as defined by the company, directly affects the level of pressure on him to make trade-offs that pressure in turn drives his need for organizational resources.His level of influence, as determined by the structure of his job and the broader system in which his job is embedded, also reflects the extent to which he needs resources. As I pointed out earlier, when an employee joins a multidisciplinary initiative, or works for two bosses, or gets a stretch goal, he begins reaching out across units more frequently. For any organization to operate at maximum efficiency and effectiveness, the supply of resources for each job and each unit must equal the demand. In other words, span of control plus span of support must equal span of accountability plus span of influence.You can determine whether any job i n your organization is poised for sustained high performanceor is designed to failby applying this simple test Using Four Spans at a Software Company as an example, draw two lines, one connecting span of control and span of support (the supply of resources) and the other connecting span of accountability and span of influence (the demand for resources). If these two lines intersect, forming an X, as they do in the exhibit, then demand equals supply (at least roughly) and the job is properly designed for sustained performance.If the lines do not cross, then the spans are mis line upwith certain consequences. If resources (span of control plus span of support) are insufficient for the task at hand, strategy implementation will fail if resources are excessive, underutilization of assets and poor sparing performance can be predicted. Depending on the desired unit of analysis, this test can be applied to an individual job, a function, a business unit, and even an entire company. When S pans Are Misaligned Consider the case of a seek high-tech company that makes medical devices.One division was rapidly losing revenue and market share to new competitors because of insufficient sales-force coverage and a deficiency of new-product development. In another division, created to bundle and cross sell products, managers were unable to get the collaboration they needed to provide a unified solution for a large potential customer. In a third, local managers were making decisions that did not support or build on the companys boilersuit direction and strategy. These situations arose because senior managers had failed to align the four spans for key jobs and for the divisions overall.In particular, the problems this company encountered reflect three common situations that can limit performance potential. The Crisis of Resources. In some cases, the supply of resources is simply inadequate for the job at hand, leaders to a failure of strategy implementation. In the medical de vices company, the sales lag had neither enough people to cover the competition (a narrow span of control) nor support from R&D to bring new products to market rapidly (a narrow span of support).A crisis of resources is most likely to occur when executives degenerate too much time thinking about control, influence, and accountability and not enough time thinking about support. They may, for instance, set the span of accountability wider than the span of control to encourage entrepreneurial behavior. And they may set the span of influence wider than the span of control to stimulate people to interact and work across units. But if the span of support is not widened to compensate for the relatively narrow span of control, people in other units will be unwilling to help when asked.Consider the local subsidiary of a regional investment bank. The managers had few direct resources (a narrow span of control) and relied on specialists from corporate headquarters to fly in to manage deals. Yet their span of accountability was relatively wide, with performance measures focusing on successful deals and revenue generation. Evaluations of the local managers failed to recognize or reward peoples commitment to help others in the organization. As a result, the span of support was too low to support the strategy of the business, which eventually failed. The Crisis of Control.Sometimes the supply of resources exceeds demand, leading to suboptimal scotch performance. In highly decentralized organizations where separate business units are created to be close to customers, a crisis of control can occur when the supply of resources (the span of control plus the span of support) exceeds corporate managements ability to effectively monitor trade-offs (the span of accountability) and to ensure coordination of knowledge sharing with other units (the span of influence). The result is un mastermindd activities across units, missed opportunities, and wasted resources.Consider a large te lecommunications company in which regions were organized as independent business units. Because of rapid growth, division managers were able to create fiefdoms in which resources were plentiful. And because of the companys success, commitment to the business mission was strong. But before long, the leave out of effective performance monitoring by corporate superiors caught up with the business. The strategies of the divisions often worked at cross-purposes there was waste and redundancy. Competitors that were more focused began overtaking the units.The Crisis of vehement Tape. This can occur in any organization where powerful rung groups, overseeing key internal processes such as strategic planning and resource allocation, design performance management systems that are too complex for the organization. In such circumstances, spans of accountability and influence are very high, but resources are insufficient and misdirected. Endless time spent in staff meetings wastes resources, s lows decision making, and makes the organization unable to respond rapidly to changing customer needs and competitive actions.The demand for resources exceeds supply, and strategy execution fails as more bustling competitors move in. Adjusting the Spans over Time Of course, organizations and job designs must change with transformation circumstances and strategies. To see how this plays out in practice, lets look at how the job spans for a typical market-facing sales unit at IBM evolved as a result of the strategic choices make by consecutive CEOs. We pick up the story in 1981, when John Opel became IBMs chief executive.IBM had been organized into stand-alone product groups that were run as profit centers. Reacting to threats from Japanese companies, Opel wanted to reposition the business as a low-cost competitor. For purposes of increasing cost efficiency, the business was reorganized on a functional basis. The span of control for operating-core units such as manufacturing was wi dened hammyally, and there was a corresponding decline in the spans of control and accountability for market-facing sales units (illustrated in the top beautify of the exhibit Three Eras at IBM).The company also enlarged its exposition of customer. Rather than focus narrowly on professional IT managers in governments and large companies, IBM began marketing to small companies, resellers, and distributors. It created experimental independent business units and gave resources for experimentation without enforce any accountability for performance. By the end of Opels tenure, IBM was criticized for confusion about strategy and priorities. As one writer noted, IBM settled into a mite that it could be all things to all customers. However, the effects of these problems were masked by the dramatic and unrelenting growth of the computer industry during this period. In 1985, John Akers took over as CEO. The organization he inherited was configured to develop, manufacture, and market c omputer science hardware in independent silos. Not only were products incompatible across categories, they failed to meet customer needs in a world that was miserable quickly from hardware to software and customer solutions. To get closer to customers, Akers created a unified marketing and services group, organized by region.The mission of this new market-facing unit was to translate customer needs into integrated product solutions and coordinate internal resources to deliver the right products to customers. Business units and divisions were consolidated into six lines of business. The span of control for the market-facing sales units widened dramatically. The new marketing and services group was made accountable for profit, and, as a result, many new profit centers were created. Unfortunately, the animated accounting system was not capable of calculating profit at the branch level or for individual customers and product lines.Instead, a top-down planning system run by centralized staff groups set sales quotas for individual product categories. Customer sales representatives thus had few choices or trade-offs their span of accountability was not wide enough to support the companys new strategy. To make matters worse, the new profit centers made the company extremely complex and fragmented, a situation reflected in the units relatively narrow spans of influence and support. As the strategys failure became evident and losses mounted, Akers considered breaking the corporation into separate entities.Lou Gerstner took thrill in 1993. He restructured the business around specific industry groups, narrowing the spans of control and widening the spans of accountability for marketing and sales units. At the same time, he widened the spans of influence by formally pairing product specialists with global industry teams, which worked closely with customers. To widen the spans of support, the company reconfigured indemnityes to give more incubus to corporate results th an to business-unit performance.Sam Palmisano took over as CEO in 2002 and fortify the positive changes wrought by Gerstner. The new CEOs strategy emphasized on-demand computing solutions delivered through seamless integration of hardware, software, and services. This involved adopting a team-based, dedicated service relationship configuration at the sales units. To ensure that all employees in such a complex organization would be willing to work across units to build customer loyalty, Palmisano worked to widen spans of support further.In a well-publicized initiative, he returned the company to its roots by reemphasizing the immenseness of IBM values such as dedication to client success, innovation, and trust and ad hominem responsibility in all relationships. To increase trust within the company and heighten the perception of fairnessnecessary actions before people will assume responsibility for helping othersPalmisano asked the board to allocate half of his 2003 bonus to other IBM executives who would be critical leaders of the new team-based strategy. A wobbly BalanceAs IBM illustrates, complex strategies for large firms usually require that all the spans of key jobs widen, indicating high levels of both demand for, and supply of, organizational resources. But the potential for problems is great in any organization where all four spans are wide and tightly aligned. A relatively small change in any one of them will disrupt the balance of supply and demand and tip the organization toward disequilibrium. In the short run, of course, the dedication and hard work of good people can often compensate for a misalignment.But the more dynamic your markets and the more demanding your customers, the more critical and difficult it becomes to ensure that all four spans of organization design are aligned to allow your business to reach its performance potential. Spans of Control at Wal-Mart The spans of control for a store manager and a merchandising manager at Wal-Ma rt are quite different. To ensure standardization in operations, Wal-Mart gives the store manager relatively little control. To promote the implementation of best practices, the company gives the merchandising manager a wide setting.Creating the Entrepreneurial Gap By attribute managers accountable for more than they control, a company can encourage entrepreneurial behavior. Four Spans at a Software Company The settings for a marketing and sales manager show a relatively narrow span of control and a relatively wide span of accountability. The discrepancy indicates that the company wants the manager to be entrepreneurial. A reasonable span of influence ensures that he has a respectable level of collaboration with colleagues outside his unit to compensate for his low span of control.Company policies designed to provide a wide span of support ensure that his entrepreneurial initiatives will get a favorable response. The dotted line connecting the two spans that describe the resources available to the job (span of control and span of support) intersects with the line connecting the two spans that describe the jobs demand for resources (span of accountability and span of influence). This shows that the supply of, and demand for, resources that apply to this job are in rough balance the job has been designed to change the manager to succeed.