Lack of a performance management system and methodology resulted in slow response times, difficulties in identifying areas of concern and measuring individual performances, and linking that to an incentive scheme. All this materialised in high staff churn. To tackle the problems, Real People decided to adopt a new management paradigm and solution, both providing single view to the performance of sales consultants and branch managers and easy KPI communication to everyone.
Real People's main reason for implementing a solution was to provide a single view to the sales consultants and branch managers on what he or she will be measured on. This meant the identification of the key KPIs that will be measured and ensure that this is effectively communicated to everyone. Thus, the set objective was to ensure a consultant can view his progress in a single view on a daily basis, as well as tracking the incentives earnings based on performance.
One other important objective was to ensure better resource utilisation across the branch environment. This would increase productivity levels, which fuels profitability. Real People also wanted to improve staff retention as well as staff morale/motivation.
Real People chose the Balanced Scorecard as a management methodology and implemented QPR ScoreCard performance management software with collaboration (QPR Portal) as well as reporting (MS Word) functionalities as the automation tool. QPR ScoreCard was integrated with the Real People Active Directory environment for user access and authentication. Data import has been automated from the Information Management Sequel Database as well as from Excel spreadsheets. An Excel export was created to extract incentive information out of QPR and imported into the payroll system.
“Successfully adopting a new culture of performance management, which translated into higher productivity levels, which in turn translated into real profits as well as improved efficiencies, is exactly what we wanted and was delivered,” says Gert Pelser, COO, Real People, SA Branch Retail Division.
Four hundred scorecards implemented in just four weeks
The measurement and incentive scheme were created upfront. QPR Strategic Partner in South Africa, EBS, implemented and automated the scorecards with QPR. EBS also ensured the logic applied to the system was sound and ensured the system is stable. It assisted at the end with a product that was easily deployed and introduced into the branch environment. The total time to implement and automate the approximate 400 scorecards took four weeks, because of the rapid implementation nature of QPR software.
Due to Real People's unique operating environment, there was a continuous change to the initial parameters, especially the calculation methodology of certain KPIs and how that links up to the incentive calculations. Another challenge during the implementation stage was to successfully enforce change management, to change the individual mindset to the scorecard methodology. A paradigm shift was needed to ensure everyone buys into the performance management culture. This was bridged by effective communication, workshops and transparency around the KPIs on the scorecard and how each KPI is measured.
One of the most important factors of getting this project off the ground up to implementation stage was the buy-in and support of executive management. In the beginning stages, the project was met with some degree of resistance, especially at branch manager level. Middle management, however, was very eager to get this implemented, as they could see the benefits and realised that this could fundamentally change the way they have done things in the past. The moment the first individuals benefited from this new way of measurement and incentivising, the use of the system was adopted easily. Once you have a few star performers that endorse the system, it becomes easier to promote the use of the system to individuals who are sceptical to adopt the new tool.
Increased sales volumes, halved approval times
In the end, it is all about return on investment (ROI) and that is starting to reflect on some key financial ratios, such as the income-to-cost ratio, as well as on operational ratios, such as productivity, turnaround time and capacity utilisation.
After adopting the new management approach and solution, Real People sales volumes increased by an average of 15%; turnaround time on application approvals time was reduced from 120 minutes to 60 minutes; audit affordability exception rate decreased from 10% to 0%; new clients acquisition increased by 15%; staff churn decreased from 28% to 20%; and productivity ratio increased by 15%.
Problem identification is now done more effectively and the intervention turnaround time has been reduced drastically. Staff has visibility regarding targets, which makes it easier for the branch managers to motivate them. They can also keep track of their sales and incentives due, which encourage them to perform. With the collaboration function, it also became easier to keep track of action plans that were assigned to under-performing individuals.
Continuing to process development
Real People is building the performance management culture by focusing more on the second tier KPIs of the business, which are more aimed at the operational side of the business, to ensure continuous improvement is negotiated across the different areas of the business. Especially looking at processes; how those can be streamlined and effectively managed and monitored.
In the future, Real People also wants to focus more on the external analytical tools, which can be incorporated into the QPR system.
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