What’s A High Performance Organization?
It’s hard to be great when you don’t know what great looks like.
Before Roger Bannister became the first person to run a mile in under four minutes, the consensus was that this feat was physically impossible. But within a year of his breaking the barrier, four more runners had crossed it, and since then, around 1,500 others have done the same.
Knowing what to aim for changes everything, in business as much as in sports. We have plenty of clear benchmarks for success in the marketplace, like getting funding from a top VC at a high valuation, achieving profitability, or becoming a unicorn.
But what’s the 4-minute mile of organizational performance?
Building a high-performance organization (HPO) is still a mysterious process for most founders. It might not even be on your radar, and if it is, you’re probably not sure exactly what an HPO is, or how to go about building one. It’s one of those things that’s hard to define, but you know it when you see it.
But that’s not going to cut it if you’re responsible for building one from scratch (which, as a founder, you are), so let’s break it down. In the simplest terms, a HPO is an organization that delivers great results for customers, investors, and employees — all three, or it’s not sustainable.
It’s surprisingly easy in the beginning. A small team running on adrenaline and dreams does this without much conscious awareness, so it’s easy to think you’ve got the whole HPO thing locked down. Unfortunately, the more successful you are, the bigger you grow, and the faster this “natural” groove slips away.
That’s when you need an explicit vision of what a HPO is and how to build one.
Turning tension in to harmony
HPOs have two things in abundance: productivity (getting the right stuff done, thereby creating value for customers and shareholders), and positivity (generating great outcomes for employees in terms of their satisfaction, belonging, and growth).
The two-by-two above says it all.
When both productivity and positivity are low, no one feels good, nothing much gets done, and no one wants to be there. Any company where that’s the dominant dynamic is not going far.
When productivity is high but positivity is low, you’ll generate good results in the short term, but you’ll struggle in the long run. People who aren’t happy at work will eventually leave, but more importantly, they’ll stop giving their best long before that (whether you know about it or not).
When productivity is low but positivity is high, in the short term employees are happy — perhaps because of all the free food and ping pong tables you’ve provided. But soon enough, your best people will get frustrated with the lack of progress. Only low-performers are happy with ‘status quo’ organizations. Top performers need to see progress before they can enjoy their sushi lunches.
High productivity and positivity is the sweet spot where people feel empowered and rewarded for doing their best work, which in turn leads to the best possible results for customers and investors.
So, how do you get there?
Productivity: Get the right stuff done
Let’s start with productivity.
The easiest way to know if your company has high productivity is to ask a few simple questions:
- Do we consistently focus on our most important priorities?
If people are working hard on things that don’t matter much in the grand scheme, they’ll end up disappointed and burned out. Real productivity means directing everyone’s energy to the right issues and opportunities.
- Do we make good progress in the time we spend working?
If people walk out of meetings or go home at the end of the day wondering what got done, watch out. Getting stuck on the occasional thorny problem is fine, but if steady progress isn’t the norm, it’s time to revisit your ways of working.
- Do we harness the collective intelligence of the team to generate ideas and reach decisions better than we could have done alone?
That’s kind of the whole point of a company. If people are just working in parallel and not truly collaborating, you’re missing the magic.
- Do we commit to action and follow through?
This is all about reliability. If employees can’t count on each other to do what they say, your customers and investors won’t be able to count on the company.
There are plenty of high-profile companies that prioritize productivity almost exclusively. Take Amazon, for example. They’re famous for their relentless, aggressive drive toward optimal output at all levels, from warehouse workers to executives. Rocket Internet, a venture builder based in Germany, shares a similar culture. They take proven business models from the US and bring them to the developing world, and their strategy is to move as fast as possible. As for their people strategy, it’s all sink or swim. Andy Grove, former Intel CEO and author of High Output Management, could be considered the ground zero of this management philosophy in Silicon Valley.
But, despite its attractions, it’s easy to see the dangers of an excessive focus on productivity. In a mature and highly mobile labor market like the US, workers have less and less tolerance for employers who allow the work experience to become miserable in the pursuit of high productivity. That leads to high turnover, which is expensive and can seriously undermine a company’s performance. If you’re Amazon and can always find another superstar from America’s deep talent pool, that may be okay. But if your pull as an employer isn’t as strong, you’ll need to rebalance your priorities.
Clearly, as important as productivity is, it won’t give you a sustainable HPO by itself.
Positivity: Create a great workplace
Positivity, the second key dimension of every HPO, is everything about the work environment that helps people do their best work and feel good about it.
It’s not as simple as just having fun at work. Ping pong tables and catered sushi lunches are all well and good, but whether they contribute to the quality of the work that gets done is questionable. The kind of positivity we’re talking about here — the kind that goes hand-in-hand with productivity — is much more nuanced.
The real test of it starts with the quality of the interactions between individuals, especially the ones employees see every day, like their teammates and managers. It also extends to the physical work environment and interactions with the company, like employee policies, benefits, and company-wide communications.
To know whether you’re creating a great place to work, ask these questions:
- Do people feel psychologically safe at work?
If they feel at risk of being ridiculed, marginalized, or dismissed, they’re far less likely to speak up, which means their best ideas may never see the light of day.
- Is it easy for them to contribute their best thinking?
If there are too few opportunities to participate in decision-making or if a few people typically hog the floor, you’ll miss out on valuable ideas and important questions your people have to offer.
- Does everyone’s view get genuine consideration?
Speaking up and getting ignored is just as frustrating as not being allowed to speak. If it happens too much, people will stop participating.
- Do people have the autonomy and support to do their best work?
Everyone has preferences about how, where, and when to do their work. The more you can empower people to honor those preferences — within the limits of the company’s resources, values, and logistics — the better they’ll feel in their jobs.
- Do people feel appreciated for their contributions?
Recognition and thanks are powerful ways to help people feel like they belong in your organization and have a sense of connection and loyalty to the people around them.
This is how you deliver for your employees, which is the key to making productivity sustainable.
Positivity began to challenge productivity as a management focus in the early 2000s. That’s when many tech companies, like Google, began to focus on attracting the best talent by providing an outstanding experience at work. Google’s 20% initiative fueled the trend, as did the publication of Netflix’s internal culture document, which allowed unlimited vacation days.
Just as with productivity, it’s all too easy to misinterpret the idea and take it to the extreme. In the last two decades, many tech companies have waged a battle of the perks to attract skilled employees, retain them, and keep them at the office for longer. The tactics range from meaningful policies, like parental leave and flexible hours, to superficial benefits like game rooms and catered meals.
The most visible incarnations of this management strategy often have the smallest impact on positivity as I’ve defined it here. That’s because they focus simply on making employees feel good, not on helping them feel good about their work.
Getting your company in the zone
After all that explanation, it should be clear on an intellectual level how productivity and positivity can work in harmony. Being productive helps people feel good about their jobs (no one likes to waste their time) and feeling good about work helps them be productive (no one does their best work when they’re miserable).
But this isn’t an intellectual exercise.
A company is a living, breathing thing — you can sense when it’s working well and when it’s not, if you know what to look for.
There’s a distinct feeling that happens when productivity and positivity are both high. It’s like being in a state of flow, where your strengths and your passions align… but for a whole team, or even your whole company. The goal is to get your people so accustomed to that feeling that they notice when it’s missing and can identify how to get back on track.
To understand what I mean, think about a truly great meeting you had, when everyone left the room thinking you’d made real progress and feeling good about it.
Imagine you had four meetings like that in a day. You’d go home and tell your partner that you had a great day, right? And if that happened every day, you’d say you had a great job.
What if that happened every day for everyone in the company?
That’s a high-performance organization.