Can the Pareto Principle be Reversed in Your Organization?

“Using a Personal Performance Analytics System – A new subset of the Business Analytics Market can help”

By Jon Bartos

Knowledge has become the key economic resource and the dominant, if not the only, source of competitive advantage.” –                 Peter F. Drucker

80-20Can the Pareto Principle of 20% of your people who produce 80% of the results be reversed?  With technology, it may now be possible.  The Business Intelligence and Analytics market is one of the fast growing sectors in Information Technology.  And for good reason.  Finally we have the tools that if set up correctly, can give us meaningful information that will allow us to make timely decisions.  By gaining this new insight, these decisions can help us improve all areas of our organizations.  Most importantly team and individual performance.

Wikipedia defines Business Analytics as:

Business analytics (BA) refers to the skills, technologies, applications and practices for continuous iterative exploration and investigation of past business performance to gain insight and drive business planning.[1] Business analytics focuses on developing new insights and understanding of business performance based on data and statistical methods.

LadderThere is a new segment of the Business Intelligence space in its infancy that has the potential to truly change the world of “work” as we know it.  It’s a segment within Business Performance Management called Personal Performance Analytics.  Like the potential of Genome therapy, Personal Performance Analytics has an opportunity to be the catalyst for an exponential increase in personal performance in every position where increasing or monitoring performance is needed.  Which by the way is needed in every position from Sales Rep, to President, to Customer Service Rep to Cost Accountant. 

Personnel Performance Analytics (PPA) – refers to the skills, technologies, applications and practices for continuous iterative exploration and investigation of past business performance to gain insight and drive business planning. Personnel Performance Analytics focuses on developing new insights and understanding of INDIVIDUAL performance based on data and statistical methods.  It can be used for all positions where performance can be measured and benchmarked, both past as well as predicting future trends.

PersonUpIf the Personnel Performance Analytics is set up correctly, the insight it can give can be priceless.  For example, when setting up a sales person on a personal performance analytics solution, we would focus on the primary activities of selling.  It would be prospecting, qualifying, presentation, setting expectations, re-qualifying, pre-closing and closing skills.  A PPA system can tell us the strengths and weaknesses of an individual in every area.  The same is true for a Customers Service Rep, Cost Account, Teacher, Nurse or Fireman.  By focusing on the primary activities of the role, we can get to the analytics part quickly. 

Typically when analytics are focused on the primary duties that need to be performed in a specific role – after 90 days here are immediate benefits:

                A full understanding of performance currently and why

Most managers today, manage by outcomes.  That’s it.  No real developing, coaching or training goes on anymore.  Often if they reach there desired outcome, they get to stay.  If they don’t, they are asked to leave.  If there is any coaching going on, 90% of managers suggest more activity to produce the desired result.  Unfortunately more often than not, that is dead wrong – like a doctor giving you an aspirin for a brain tumor.  You might be able to temporarily postpone the pain, but it certainly won’t cure the problem.  By using a Personal Performance Analytics system, you know the specific reason why the performance is where it is, either good or bad.  But now, with that new information, corrective action can be taken by the individual or the manager to get the required training or redirection from the specific deficiency identified.   In our example above, if our sales person struggled with qualifying skills, more activity would simply lead to more company resources used up and counterproductive to the outcome of more revenue desired.

The “AHA” Moment

KeytoSuccessWhen individuals and managers use a PPA system, there is always an “AHA” moment.  It typically occurs once 30 – 60 days if metrics are collected.  The “AHA” moment is when one finally identifies the main issue that is causing them to be unable to achieve their objective.  And more often than not, it’s a complete surprise.

In working with a top Account Executive from a National Recruiting Firm, the manager swore his top AE needed to make more calls and face to face appointments.  After setting her up on a PPA system, the “AHA” moment was realizing that she worked on 10 jobs to make one placement.  The problem wasn’t more activity – it was qualifying the work she had taken.  Once she realized the problem and developed 5 questions to further qualify her searches, her revenue doubled in 90 days.  Yes doubled.

A map to true “continual improvement” can be drawn

Instead of guessing what break out session to go to at conferences or deciding on what specific training your team should have, with a PPA system you can pinpoint the training and development actually needed.   No more wasted time and money on training they don’t need, we can focus on what needs to be done to hit individual and team objectives.  Based on our discovery of our deficiencies, like a straight line from A to B, we can put together a development program to get the quickest path to change and the objective obtained.  Once the initial deficiency is resolved, then the next item on the list can be worked on for improvement, whatever it may be that the PPA system identifies. Continual improvement to achieve human potential. 

Bottom Line Results

The reason we all should be interested in using a PPA system is bottom line results.   Increased performance.  But there is also other benefits users are seeing:  rookies coming up to speed faster, tenured employees see immediate identification of problematic areas, accountability is switched from Manager to Performer, real training and Development paths are created, online reward systems are put in place and Individuals and teams have an opportunity to reach their performance potential.

RPMLogo-MedThe RPM System was created for just this reason.  Achieving your individual and team potential in selling.  It’s a cloud based PPA tool that takes data from multiple CRM/ATS systems to populate the data.  The RPM Solution helps individuals and teams set goals, calculate metrics, give weekly dashboard views, pin point specific strengths and weaknesses and finally gives training and development on the areas of deficiency.  Join companies seeing incredible results all around the globe by going contacting us at info@rpm-usa.com today for more information on how to reverse the Pareto Principle going on at your organization.

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One thought on “Can the Pareto Principle be Reversed in Your Organization?

  1. Pingback: Pareto for anyone | elivergara - Life as I know it

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