A High Performance Organization is, in the first place, agile and achieves both financial and non-financial results far superior to those of the benchmarks in their industry for five or more years.
Likewise, these are organizations that have been built and transformed through a holistic design by focusing well-disciplined on what really matters to this specific organization, this being the needs of the client.
Further research by leading experts such as André De Waal, David Hanna and Jim Collins, have proven that there is a direct and positive correlation between the organizational cultures of these companies and their results. Despite which sector, industry or country they compete in they always achieve great results.
Therefore, the cultural features that distinguish High Performance Organizations are:
Firstly, leaders capable of developing the next generation of leaders. In other words, leaders capable of making the organization’s professionals and teams grow in order to innovate, think and act. And they achieve this by using technological and digital resources and continuously achieve the company’s objectives.
High level of engagement and responsibility by the collaborators
Another keypoint, high performance professionals and teams that adopt individual responsibility. This becomes the essential pillar for making collaboration, transparency, joint creation and self-organization the fundamental principles of teamwork.
Long-term orientation and work
However, it is by no means enough to achieve the short and medium-term objectives. In High Performance Organizations, the challenge begins with persuing a long-term orientation each and every day. By doing so they keep continuously questioning the way they think and act.
Besides, it is this challenge to follow a very defined vision or ideal in the long term what unleashes the creativity and courages all people in the organization. It helps them to innovate and change everything that requires a change but preserve the values that unite them in the quest for that ideal.
Due to that approach, each member of a High Performance Organization is never satisfied with this ideal status and remains in a creative tension to constantly search for a better way.
Innovation and continuous improvement
Moreover, in High Performance Organizations innovation is not the responsibility of one single department or a limited number of people. Quite the contrary. Innovation is a way of thinking, acting and learning individually and collectively to deliver in a differential and disruptive way. It involves many small synchronized steps towards a common goal.
However, as a mindset, innovation is based on the profound belief that the job is to execute with discipline and excellence. And it encourages individuals to innovate in order to render obsolete what we even execute with excellence today.
Practically speaking, innovating on a daily basis means:
- To agree on the best ways of working as a team. Thus, to implement them according to those agreements until confidence, understanding and certainty – based on facts and data – have been built. Those are the ways of working to be executed with excellence.
- Create-measure-learn-iterate: applying facts and data to experiment and validate disruptive ways of get things done.
- Repeat steps one and two stedily and consistently, with the maximum possible agility and cadence. Henceforth, we will advance with agility towards the long-term vision of the company.
Openness and action orientation
Finally, customer centricity. A strong emphasis on external openness and orientation towards understanding the voice and feedback of customers. This being the bedrock of individual and collective performance.
In High Performance Organizations, every action, initiative or project always starts with a consideration of who the end customer aka the boss is, what he expects and what he needs.
However, «client» does not only refer to the person who will acquire the final product or service. It also includes the person or team who will receive the result of your work. Also, to other stakeholders who expect the best result from your actions.
Outcomes of High Performance Organizations
Above all, those companies that have built organizational cultures reflecting the principles described above achieve superior performances on the following business indicators:
- Return on Assets (ROA)
- Return on Equity (ROE)
- Return on Investment (ROI)
- Total Shareholder Return (TSR)
- Return on Sales (ROS)
Regarding non-financial results, High Performance Organizations also accomplish great achievements such as increased customer satisfaction and loyalty, employee commitment and involvement.
The same happens when taking into acount increased quality of products and services offered to customers and consumers.
From the organizational point of view, High Performance Organizations have the following capabilities:
- Great ability to adapt to changes;
- High focus on understanding and integrating the expressed/unexpressed needs of clients;
- Great ability to respond quickly to customer needs and changes in the environment;
- Mission, objectives, processes and integrated work systems with strong alignment between strategy, structure, operations and people throughout the organization;
- Organizational and individual focus on continuous innovation and reinvention of core competencies;
- Outstanding ability to develop the skills of individuals and teams to spearhead the requirements of the future.
Building High Performance Organizations
To focus on what really matters and deliver the results needed, High Performance Organizations employ a holistic approach to their structure. Besides, they incorporate continuous diagnosis, design and development into their business model.
Nevertheless, the building and development of these organizations does neither depend on circumstances nor on the particular perceptions of individuals or shareholders. In fact it is much more a matter of conscious choice and collective organizational design.
To achieve outstanding results, these organizations are consciously designed to develop, operate and perform entirely different. As David Hanna points out:
“All organizations are perfectly designed to get the results they get.”
This is why High Performance Organizations apply models and tools of organizational innovation for diagnosis, design and development that allow them to evolve in an integral way to offer high performance in the future.
The question is, what objectives do they pursue through this continuous diagnosis, design and development?
Design Objectives of High Performance Organizations
Of the numerous objectives that the design of High Performance Organizations pursues, here is the focus on four fundamental ones:
- Streamline the business by creating the systems and organizational capabilities that allow it to constantly realign itself according to changing internal and external circumstances.
- Enable and encourage inter-functional and inter-hierarchical collaboration as well as collaboration across different organizations, cultures and countries.
- Connect the potential of the organization by removing political boundaries and barriers that prevent innovation and continuous value creation.
- Promote an outward orientation, especially focused on customers, enabling disruptive thinking as a source of acceleration and internal innovation.
The future goes to High Performance Organizations
The future will hold tremendous opportunities for companies and businesses. However, that future is reserved for High Performance Organizations.
In conclussion, companies are today facing a scenario that has never been experienced before, especially due to the immediacy of the economy. The speed at which society and markets are being transformed by technological advances requires them to accelerate value creation by generating innovations, products and services more quickly and reliably.
Thereupon, in this environment, competitive advantage belongs to companies that can accelerate their efforts to build and execute high performance strategies. This allows them to identify challenges more quickly and accelerate their decision-making and consequently enables them to develop and deploy responses effectively and quickly.
All in all, to achieve these targets successfully, companies have to be able to attract, develop, and connect collaborators and teams spread across the globe. It is decisive to give priority to designing organizational systems that streamline business. And, after that, enable collaboration, innovation, and talent acquisition with a clear focus on meeting the expressed and unexpressed requirements of customers and consumers.