Page 165 - Performance Leadership

154 • Part III Principles from the Values and Social Dimensions

Table 9.7
Internal versus External Orientation

Internally Oriented Externally Oriented
Management process Top down, sequential Iterative and networked
Key performance indicators Variance analysis, aimed Benchmarks, aimed at
at deadlines speed
Feedback Up or out From external
stakeholders
Rewards Personal Group-based
Dysfunctional Behavior Running numbers instead Challenging the system
of running the business, with endless “what if”
trying to ignore external questions
effects

independent. Multiple dimensions point, for instance, toward group-
based or personal rewards, lead to the same dysfunctional behaviors.
This reinforces the impact of not minding corporate culture or national
cultural differences when implementing performance management.
Chapter 3 discussed the example of the waste management company,
where the CFO implemented all the best practices for performance
management and saw performance of the best-scoring districts drop.
This could have been avoided by understanding that the corporate cul-
ture was a combination of the following characteristics: group-based,
aristocratic, relationship-oriented, Theory X. Openly publishing num-
bers would never work in such a culture.
Organizations should do a cultural performance management analy-
sis before embarking on a performance management initiative. Or, they
should do such an analysis where initiatives already under way are suf-
fering from dysfunctional behaviors, to help get the initiative on track
again. In a cultural performance analysis, we classify the organization
on all cultural dimensions (see Figure 9.4).
It is important to realize that there is no right or wrong culture in
the cultural performance management analysis. Every score is good;
the key is that you are aware of the characteristics of your own corpo-
rate culture.
In the example, company 1, a manufacturer, is a classic public com-
pany with a strong U.S.-based business culture. The company has a