The Elephant in the Boardroom

By Adrian Harvey & Dan Gray

Adrian Harvey and Dan Gray have spent years running businesses and researching and developing ideas and concepts around enterprise performance management; in particular the tricky issue of employee competency. The result is a universally applicable, scientifically grounded, easily accessible game-changer of which most people are completely unaware.

'The Elephant in the Boardroom' explores this essential and ground-breaking metric providing insight and clarity that will benefit your organisation and boost business growth. And we don’t stop at the concept; ‘The Elephant in the Boardroom’ will take you right through to practical implementation and effective realisation.

• Language: English
• Publisher: Adrian Harvey & Dan Gray
• Release date: May 1, 2014
• ISBN: 9781310250323

Adrian Harvey & Dan Gray

Hi my name is Clever Nelly and I am the star of the book, Elephant in the Boardroom. We have decided that all net proceeds from our book sales will go toward our staff Christmas party.

Book preview

THE ELEPHANT IN THE BOARDROOM

Copyright © Adrian Harvey and Dan Gray 2014

Smashwords Edition

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All rights are reserved. No part of this publication can be reproduced or transmitted in any form or by any means, electronic or mechanical, without the written permission of the author.

Contents

Preface

Chapter 1: About the Authors – Adrian Harvey and Dan Gray

Chapter 2: Are You Missing the Point?

Chapter 3: The Missing Metric – CPI

Chapter 4: Practical Considerations – Real Life

Chapter 5: The Trojan Elephant – Meet Clever Nelly

Chapter 6: Why Does Nelly Work So Well?

Preface

This book is about performance management. It is a practical guide for managers and leaders who want to improve the performance of their divisions, teams or whole businesses. If you are convinced that you already have every angle covered and that your business/department/team couldn’t possibly get any better, do yourself a favour, put this book down and perhaps choose a novel or an interesting biography instead.

Still with us? Excellent.

Do you recognise this scene? You and other members of management and the leadership team are at a management away-day to work out how you are going to drive double-digit earnings growth, in a flat market, whilst cutting costs and reducing capital expenditure. We’ve all been there at some point and if you haven’t yet – you will be.

Joking aside, it is the responsibility of every company executive to seek improvement in the performance of the business they run; if your business is not growing then it is dying. There are times, of course, when it is pretty much a case of doing what we did last year; raise prices, look for a few operational cost efficiencies, and you are easily able to hit ‘Plan’.

Then there are times like the disaster scenario outlined above where your task would appear impossible even before you start. What do you do and how do you conjure up material improvements in enterprise performance, with even less resources than the previous year?

Doubtless there are many options that company executives explore: ruthless cost cutting, wage freezes, redundancies, investment deferral, product discounting … the list is endless. Some of these may work and some may actually cause the business irreparable long-term harm. The stock market is littered with examples of companies that have, in reality, raided the piggy bank and made value destroying performance decisions, then posted a few years of apparent earnings success only to have to suffer a profits warning and material re-alignment (read 'fall') in the value of their stock; sometimes with catastrophic consequences, as more efficient competitors seize the opportunity to acquire these companies on the cheap or capitalise on their now relatively strong competitive position.

Now, what if we were to tell you that there is another way, a better way, a more holistic and logical way that has the potential to drive massive year on year performance improvement through almost any business and that doesn’t require massive investment? Oh, and that you're not currently doing it. Being provocative, what if we were to tell you that you’re missing a BIG trick?

Some people would stop reading at this point and dismiss us, the authors, as ‘fruit-cakes’ who don’t really understand what it's like to run a business like theirs. Some would cynically flick through the book looking for justification that they are one of the very few who is already doing this. You know the type, the 'Yeah yeah, we already do that' brigade.

If you're still reading, congratulations for keeping an open mind and for being curious that perhaps, just perhaps, we may know what we are talking about. After all, it’s only a short book; what have you got to lose?

Let’s consider two companies that on the face of it look identical: they operate in the same market, have the same strategy, are of similar size, and yet one consistently delivers materially better financial results. Why?

It will come as little surprise to some of you that the answer is simple and will quite literally be staring you in the face: their people. That’s right, one definition of a ‘company’ is 'a number of individuals gathered together'. In the above example the consistently better performing company has better employees.

How is ‘better’ defined? Simply that they are more competent in their work roles. Over simplified? Perhaps, but ask yourself this question: 'What would I rather lead; a company of highly competent employees and managers or a company of fairly competent employees and managers?' Hands up who preferred the ‘fairly competent' people? Of course nobody in their right mind would opt to bat with the less competent team. Why would you?

Now for the million-dollar question: 'How competent is your workforce?'

Pause a moment to consider this question. Have you got an answer?

Excellent! So the next question is, 'How do you know?' Seriously, we mean it; how do you really know how competent your workforce is? Then consider this, how did you actually express this level of competency about your workforce? Did you use words like 'reasonably', 'sufficiently', 'excellent', 'average', or did you have a precise numerical score for your workforce competency?

Now be honest, you chose an adjective, didn’t you? Probably based on a mix of intuition and macro enterprise performance data that you could ‘reasonably use to extrapolate an assumed level of competency'. Are we right?

We’d be very surprised if not; nobody continually measures workforce competency and expresses it as a number, because they … well, they just don’t, do they?

Don’t you think this is strange? We did. Consider the facts. The workforce wage bill is