Implementing Effective Performance Management Systems

Welcome to the Magnetic Marketing Podcast. In this episode, we're going to be talking about how to implement effective performance management systems. Now, if you're in corporate America, that like makes you want to lean back and yawn because the lengthy diatribe of all the systems are going to be set up and it's going to be obnoxious. However, for those of us who have a smaller business, this is something that we usually overlook. It's something that we usually try to run from our gut. It's all reactive-based. And so we need to shift that and make sure that we are focused 100% on making this conscious instead of subconscious for our employees. It's direct in what they recognize, and that kind of change requires incremental adjustments. So with that said, what we're going to be talking about are the 4 components of effective management system. There are 4 different pieces that you absolutely need, and then as you're applying all of these 4 pieces, there are 7 elements that are going to help you do that step by step and make sure that you don't miss a thing. So once again, this is supposed to be incremental. So as you listen to this, pay attention for one thing that may come to mind, one single thing that you can implement that might be able to create an exponential change inside of your management process currently. And if this really resonates, bookmark it, share it with a friend. With that said, let's jump into implementing effective performance management systems.

I don't think there's anybody that has had a bigger impact in the field of direct response than Dan Kennedy. The legend of Dan Kennedy should be Ignored at your own peril.

They're not really lessons, they're kind of laws that you live by.

Dan opened my eyes to what small business marketing looks like. Dan teaches strategic direct response that is timeless. His ripple effect touches people who don't even know his name.

The world as we know it was changed because Dan Kennedy became obsessed with marketing.

Welcome to the Magnetic Marketing Podcast with your host, Dan Kennedy.

15 years ago, I guess, I went to a mastermind group in Baltimore with a bunch of entrepreneurs, and one day we had a guest speaker come in. A guy who is the absolute twin brother to Brad Pitt, looks exactly like him, came in. You're about to see that. I mean, all the ladies in the room, be still your heart. Came in to talk to us about management, how to manage your company, how to manage the people that you work with. And I was immediately running my menswear stores, 65 employees, struggling every day with the management issues.

It wasn't—

I wasn't a happy camper. I was immediately gravitated to this guy. As a matter of fact, I had tried others before him Did not get any kind of results, but I was willing to try anything because I knew there had to be a solution. I knew there had to be an answer, and it was the best thing that I've ever done. And I said it earlier today, but I'll say it once again. There's 3 people in this world who have had the biggest change, made the biggest difference in my life. And all of you that are out there, you can all think of people that have big changes, big differences in your life. And there was 3 people, and the speaker that you're about to hear is one of those three people. My father, one, Dan Kenny, two, and Vince Cerpoli, number three. And I just love this guy. I mean, this guy, he has a saying which is, you can't give away good. And because what he means by that is every time he tries to give away something good, it comes back to him, multiplies back to him. And that's sort of a glimpse into the kind of guy you're about to see. He has developed a system for management which is called a performance management system. My belief is there is absolutely no way possible that you could manage any kind of an organization, any kind of company without using this kind of performance management system. Other than that, everything that you do is subjective. This is not subjective. This is objective. So as a favor to me, because he doesn't come to this, he listened Lives in Baltimore. He's a favorite to me. He got on a plane this morning. He flew here, and he's going to go back tonight. He came here to serve because everybody, all of our members are always saying to me all the time is, "I'm having management issues." I know I've connected Vince with a couple of our members. Susan Berkley here is in the room. John Mies is in the room. Tom Koester is in the room. He's worked with them, and it's been— the results are the same. So it's what I'm really— it's my honor to bring up my friend and my mentor, Mr. Vince Tripoli.

Thank you, Ray. I didn't like the order he put me in, after his father and Dan. We're here to talk about performance management. And as Bill indicated, it's been a number of years ago, about 15 years ago, that I helped him install a performance management system. And basically, a performance management system is a method, it's a system for getting things done through people. That's the definition of management, getting things done through people. So often managers don't understand their responsibility in getting things done through people. But Bill has credited this performance management system with a lot of the success that he's achieved, not only in his previous business but also in his current business. Now, what I found in working with thousands of managers over a period of time was that most organizations, most managers have a performance management system, and they utilize that performance management system on an ongoing basis. However, that performance management system is subliminal. People start to manage people, other people, and they use the activities to manage on an ongoing basis, but subliminally, as a result of it being subliminal, subliminal basis rather, they can't take any corrective action to make the system better. So what I do with organizations is I try to raise the system they're currently using to a conscious basis, because when it's on a conscious basis, you can take the necessary corrective action to make it more effective. What I found in all of my work with managers is that most managers see problems they incur as really problems. And I found that the overwhelming majority of situations that managers call problems are really symptoms of an ineffective performance management system. Now, I'm not saying that any of you have an ineffective performance management system. Only you can do that by your answer to a few questions that I'll generally raise as we go along here. But one of the major symptoms of an ineffective performance management system is unsatisfactory productivity. I'm sure all of you from time to time have experienced flat or declining sales. Now needless to say, this is always a problem, but when that problem recurs over a period of time, then it's a serious situation. I think that most people who run organizations try to correct that in different manner, in But it doesn't always work. The real key is first defining what unsatisfactory productivity is. And I'll give you a couple definitions. Unsatisfactory sales productivity indeed is when the sales are down. But it also encompasses periods of time when they come back up and go back down again. There seems to be peaks and valleys in the production of organizations. It also encompasses periods of the year that managers buy in, that, oh, we always have a lousy January or February. It also encompasses periods of time when the economy goes down and their salespeople or other people within the organization use the economy as an excuse for lack of performance. You see, most of the things I'm telling you here are not academic, they're experiential. Throughout my career, I managed people in organizations where the economy was in terrible shambles, but we still made fantastic progress by understanding the concepts of a performance management system. But it also includes the pace of the workflow. Lots of times managers complain that the pace of the workflow in their organization is so slow it's like trying to empty a bottle of molasses while you're in a freezer. It comes out very, very slow. It also encompasses the meeting of target dates that frequently hamper management people. How often have you delegated to a subordinate a particular job you wanted done, and then you found out the night before, the week before, the day before that nothing was done before the target date? Error. Error rate is awfully high in organizations that really do not have an effective performance management system. And poor quality is another thing. That encompasses that. But let me see if I'm working with the right crowd here. Of these situations, are you now, or have you ever experienced this kind of unsatisfactory productivity? Raise your hand, please. Okay, good. All right, another factor that's a symptom of an ineffective performance management system is turnover in the organization. You know, I found that many, many managers— well, I guess CEOs more than managers— really aren't aware of the turnover situation in their organization, depending on the size of the organization and its costliness to the operation. One of the standard questions I ask a CEO when I start working with a company, what's the turnover rate? And the standard answer, "Oh, we don't have bad turnover." But then when I start to investigate, what I find is the senior person in the organization of 25 to 30 people may have 3 to 5 years with the company. Well, I ask myself, "What happened to all those people?" Turnover in the organization. So it isn't that managers— they just don't pay attention to the turnover rate, and they've got to pay attention to it. Because it's costly. It damages the organization in so many ways. It hurts morale. It breeds insecurity, and when you really stimulate the insecurity in an organization, productivity comes down with it. When people have to satisfy their lower needs because they're insecure, you're going to find productivity comes down with that insecurity. Hurts customer service, but the most important factor is the cost. The cost of turnover is horrendous. Research, recent research indicates that every time you lose an individual, it costs you in finding someone new, training someone new, loss of productivity, everything involved in it, 1.5 times their salary. So if you're paying $50,000 a year, it costs you $75,000. You don't notice it, but your margins begin to shrink. What's more, as you move up in the organization, it costs more. If you lose a manager, that's about 2.5 times the salary. So turnover is a symptom of an ineffective performance management system, and an effective performance management system addresses those two problems. Poor morale is another thing you see quite frequently in the organization. Doom and gloom. I've walked into organizations that you couldn't cut the morale with a chainsaw, it was so thick. You walk up to someone in the organization, you say, "Good morning, how are you today?" He looks to his fellow employee and says, "What do you mean by that?" Now that's poor morale in an organization. And in most organizations, when there's poor morale, it impacts productivity. There's no question about it impacting productivity. And this is what brings to fruition the negative thinkers. If there's a negative attitude there, the negative thinkers begin to fill it. They see the glass of water half empty rather than half full. You know, if there's 5% unemployed, that's what they see. They see the 5% unemployed rather than the 90% 95% working out there. And you cannot make progress when the morale of an organization is down. But yet again, a performance management system, an effective performance management system, is designed to reverse all that. Finally, here's the real debilitating thing in most organizations: resistance to change. How many times have you spent thousands, if not hundreds of thousands of dollars in bringing in new technology, and yet people fail to change, to adapt to the new technology? They resist it. And what happens if you're sold on the use of the new technology and you're going to insist that they use it? They either use it or they're gone in a short period of time. Fostering the problem of turnover again, costing the company more money. Resistance to change comes about because managers attempt to change things in fell swoops. You can't do that. You can't change behavior in fell swoops. The performance management system brings about change because it brings it about in almost tiny, insignificant increments. From week to week to week. Let's look at some of the other problems that an ineffective performance management system breeds. We already covered declining and low productivity or output, slow workflow, high employee turnover, poor morale. It generates communications problems. We covered resistance to change, but high absenteeism is another symptom. Dissatisfied customer, failure to assume responsibility. It's not my job. It's one of the things you hear quite frequently. If we had the time, I'd go into why everybody's got to assume 100% responsibility, but Bill limited me to 70 minutes here today. Employee management conflict, poor quality, high error rate. Now, if these problems ever bugged you since you took over your operations, Please raise your hand. I want to make sure I'm hitting everybody. Good. And if you didn't raise your hand, then don't feel too self-satisfied because lots of these problems don't show up, but the productivity of the organization is really not where it can be. Okay, let's talk about a performance management system. I'm going to give you the components of an effective performance management system. But you have to understand a couple of precepts about managing people. If you understand this, any management system you use will be very, very effective out there. There's 4 basic concepts that you have to understand. Number 1, is the 5-percenter. Number 2 is catching people doing things right. Number 3 is a learning organization. And number 4 is systems control behavior. Let's take them one at a time. If you take a look at any organization, what you're going to find is 5% of that organization are self-starters. You recognize them, I know. You say, "Go in that direction." And what do they do? They plan, they organize, they motivate themselves, they control their activities. And before you know it, they're really leading the whole operation, doing a great job. You're very proud of them. Well, the problem with those 5%ers, quite frequently, they're the ones who are recognized and promoted into management. And when you tell these 5-percenters that they have to work with people, they have to develop people, they have to motivate people, they have to coach people, they come back with, "Well, no one had to do that for me." And they're right. No one had to do it for them because they are 5-percenters. What they fail to realize is that they're managing the 95-percenters. And the 5-percenter has to be ready to accept that, that they're managing the 95-percenters. And these 95-percenters are not bad people. The difference between a 95-percenter and a 5-percenter is basically this: the 5-percenter is goal-oriented initially. They don't come into your operation to help you become successful. They come into your operation because they see your business as a way of satisfying their personal needs, whether those personal needs be retiring early, putting their children through college, buying that home, that vacation place, whatever. They see the job as a vehicle of conveyance. They think strategically. They're looking down the road at their lives, and they see the job in which— as a method of bringing their goals to fruition. 95-percenters are good workers, too, but many of those 95-percenters can become 5%ers providing management develops them. When I say develop them, I mean creates an environment in which they develop. Because all development and all motivation is self-development and self-motivation. A performance management system is designed to do this. It's designed to create an environment in which people are growing on an ongoing basis. It's extremely important to the future of your organization. The second concept here is catching people doing things right. You know, a few years ago there was a style of management, if you want to call it that, called managing by exception. And it's still employed quite frequently by a lot of managers. And management by exception really is catching people doing things wrong. And we know in lots of organizations that's the way it's done. The supervisor doesn't talk to the subordinate unless he does something wrong. And when you talk to the supervisor about that, quite frequently the supervisor will say, "Well, that's why we're paying them that, to do everything right." The 5% are making the fatal assumption that everybody's a 5%. You say you have to coach, you have to motivate, you have to develop or create the environment in which they develop themselves and motivate themselves. They think the individual should be doing that on their own. Well, you've got to approach that with a philosophy of catching people doing things right. Fact is, a basic tenet of behavior modification is that any action, any action followed by a positive consequence tends to increase the frequency of that action. So if we catch people doing things right, they're going to do more things right. But if the only time we talk with them is when they do something wrong, then they're going to pull their neck in, just like a turtle. They're not going to be in the forefront of change for your organization. What you have to do is empower them. And the way you would start to empower them anyway is start to catch them doing things right. And when you start to catch them doing things right, you'll see they'll start to empower themselves. You'll create the framework within which they'll empower themselves. Needless to say, they can't go on and make indiscriminate decisions out there, but within a framework, there are decisions they can make and they have to make. And that leads me to the next point there, a learning organization. A few years ago, a demographer's group did some research. And they said that as we move into the 21st century, there is going to be a lot more skilled positions that are open than there are people to fill them. In other words, we're going to have a shortage of people who have skills in the area that we're really interested in. But we won't be able to fill those positions. But that research also came up with the fact that people will stay with organizations where they have the opportunity to grow. Now what does that mean, the opportunity to grow? The opportunity to grow means make decisions within the framework of their job. That's the opportunity to grow. That's empowerment. Now needless to say, it has to be within a framework that you set up. If someone came in and said, I could do this better if I had another $10,000 to spend in this particular area, well that's outside a broad framework. You've got to stimulate their creativity by getting them to think within the parameters that you establish. But the organization should be a learning organization because when people learn and grow, they motivate themselves. Research indicates they motivate themselves through self-actualization. They're really excited when they're in a job because they feel they have some control control over their future. The manager's job is a facilitator, to facilitate all this, not to sit there as a— in a dictatorial or authoritative posture and say, "Here's the way you do it, 1, 2, 3, 4." Now, needless to say, there are times when you're bringing in someone new, you may have to assume that posture. But after a short period of time, you should really be eliciting answers from them. How do you do it? How are you going to do it? The personal development interview, which is a component of a performance management system, facilitates this. The final concept you have to master is in any organization, systems control behavior. They influence as a minimum and control as a maximum. The behavior of individuals within that organization. You see, when people join an organization, they learn their job on a conscious basis. But if the functions of that job are repetitive, sooner or later they relegate it to an unconscious part of the brain and do it almost unconsciously. Give you a parallel: if you learn to drive in a gearshift automobile. Think back. When you first learned to drive in that gearshift automobile, you were focused on the activity. You knew you had to put the clutch in to put it in first, and as you let the clutch out, you pressed on the accelerator, and vice versa, until you mastered the process. But after you mastered the process, your mind was on a million different things. You never thought of it. The same thing happens in the workplace. People learn their job and they relegate it to an unconscious part of the mind and do it unconsciously, and hence bringing about the behavior change you're seeking is awfully difficult. And when you can't bring about the behavior change, you turn them over and bring someone else in, shrinking margins even further. American Management Association made a study a number of years ago, and they indicated that what people learn in seminars such as this, okay, really is not cost-effective. And the reason it's not cost-effective is because they go— they get excited about the new learning, just like you all got excited here today over all the things that were described, terrific things, but they go back into a system that they created that doesn't support the new learning. As a result, less than 5% behavior change takes place. But with an effective performance management system, all of these problems are addressed. Let's take a look at what an effective performance management system looks like. You see the components up there. There are 7 basic components, and I'm confident that if we raised the system that you're currently using to manage people up to a conscious level, you'd see that you're doing a number of these things. But it isn't effective unless it's organized into an effective system, a system in which each step is related to another. The personal development interview Objectives, objective-focused activities, feedback, measurement, reinforcement or motivation, and coaching. The personal development interview is a weekly interview that each manager holds with his or her reports. It's a short interview, 15-20 minutes. Some people say Well, Vince, why should I meet with my subordinates on a weekly basis? I see them 40, 50 times a day. We're interacting with each other. And indeed you are. But you're interacting on tactical issues. How do you do this? And what will we do here? And how about this credit form? These are all tactical issues. The personal development interview is designed to interact on strategic issues. Where do we want to go? And what kind of progress did you make last week toward those objectives? This is where all the development takes place, in this interview. It's an extremely important interview in which the manager is not the know-it-all guru. The manager can't be the know-it-all guru. If you want to develop people. The manager has to learn to elicit solutions from the people he or she is working with. Now needless to say, this is on a spectrum. If I'm working with a brand new person, just initially training them, I'm going to be involved more. But as they start to find their way, I start to back off. As a matter of fact, one of the ways we measure the effectiveness of this interview is who does the most talking. If the manager does more than 20% of the talking, we don't consider it an effective interview unless he's training— he or she is training someone new out there. The personal development interview is the keystone of the whole process. Just think now, if the manager has to meet with me, and I'm a subordinate, on a weekly basis, and I know that he's going to ask me about the performance, my last week's performance toward the objectives for which he or she is holding me responsible for, what does that do? That prioritizes the work I have to do. You know, I walk into hundreds of organizations, and what I found is, today, because of the concern for costs, people have more peas on their knife than they can handle. It isn't that people aren't working, but they're not working on the right things quite frequently. And that's because it's not being prioritized. You see, people respond to the areas where their leadership shows concern, but that That concern's got to be continuous. It can't be sporadic. It's got to be continuous, and that's the purpose of the weekly personal development interview. It's really to sit down and draw from that individual solutions to problems and recognize him for the progress he or she made out there. That's the key. When people don't get recognized for the progress that they make, then they They say, "Oh, what's the difference? The only time the boss sees me is when I do something wrong." So they perform at a level just to keep you off their back. And as long as they perform at a level to keep you off their back, you're not going to achieve your goals out there. The performance, or the personal development interview, has some other functions. I said one of the important things we measure is the amount of talk. The second most important thing we measure is how that individual walks out of that meeting. If they walk out of their meeting with their tail between their legs and you're not ready to terminate that individual, forget about the meetings. They're harassment meetings. Now there is a time when you will send them out with their tail between their legs, when you've done all the positive things and created an environment in which they should be motivating themselves, they should be making progress and they're not moving. A performance management system brings those problems to a head in short order before you've invested a lot of money in that individual. What you're looking for in the personal development interview is gradual improvement. Gradual improvement. People improve at different rates depending on their ability, depending on their background. So if you see gradual improvement, then you've got to reinforce that improvement. But you don't only reinforce that improvement, you try and find out what they are doing. Someone does a good job, you say, "You know, you did a great job last week in this particular area. Tell me how you did that." And frequently, if you haven't asked that question before, they're going to come back with, Well, I worked hard. You're going to say, I know you worked hard, Bill. You work hard all the time. But tell me specifically how you did that. Because when you pursue specificity, what you do is you start to bring the systems they're using up to a conscious basis. And that is the only way you're going to bring about change. You've got to bring the performance management system, their performance management system, up to a conscious basis in order to develop them. I don't mean for you to develop them, create the environment in which you develop them. So this meeting is awfully important. Indeed, as I said before, the average manager interacts with a subordinate, according to research, 37 times a week, but they're all tactical interactions. What you're looking for here is a strategic interaction. Again, what is the reason for that? Let's take a look at the reason. The reason is to get them to think in terms of objectives. Because when they start thinking in terms of objectives in a job, the same principles are applicable to their own lives. And you begin to turn a 95-percenter into a 5-percenter. You won't turn all of them into 5-percenters, there's no question about that. That, but you'll turn enough to put the pressure for social acceptance on the rest of the group to do a much better job out there. In order to do that, you have to start out with objectives, the second important component. There has to be specific objectives. It can't be, "Go out there and do a better job." Well, where do you develop the objectives? You take a look at the job description, or you take a look at the job if you don't have a job description, and you try to quantify end results. It's not difficult. You try and quantify end results, and what you're looking for is what we call SMART objectives, you see in parentheses there. And what SMART objectives are basically is this: Number 1, the objective has to be specific. Number 2, it has to be measurable. Number 3, it has to be attainable. Number 4, it has to be relevant. And number 5, it has to be timed. And don't sell that timing down the road. Timing is extremely important for creating that motivating environment. You know, years ago when I was a kid, kids used to take a Coke bottle bottle, and they fill it halfway up with water, and then they take some carbide and put it in the water, pop a cork on it, and run. Because after the carbide hit the water, a gas was created, and in a few minutes the bottle would go into a million pieces or the cork would go several hundred feet into the air. That's the only kind of pressure you can create on an individual— pressure from within, not pressure on the outside. But pressure from within. Time dates help them create that kind of pressure within themselves. Time dates are part of it. Goals are the most important part of it. Objective-focused activities are the third important component. What are objective-focused activities? Well, objective-focused activities are the activities that people have to engage in in order to reach What's the objectives that you're holding them responsible for? You know, some people try to manage by end results alone, but no one controls the end result. I don't care what position you're in in the organization, no one controls the end result. What people control and what you can manage are the activities that lead to that end result. You're controlling and managing the activities. The individual is controlling and managing the activities. And you foster that in the personal development interview when you say, "Well, you know, you did a good job. You're improving. But what do you think you can do to close the gap between where you are and where you want to be?" And you're listening now for activities. They're bringing the activities up to a conscious basis. And you don't have to be the critiquer there. Quite frequently, as they bring them up to a conscious basis, they begin to recognize themselves. They could improve that activity. And quite frequently, they give you that feedback like they already did make that move. And they actually didn't when they accomplished that job. But that's okay. Don't worry about that. If you're going to change behavior, you've got to draw it out of their mouths. You cannot change behavior by saying, "I want you to do A, B, C, and D." you will not change behavior. It'll change less than 5% to a degree to keep you off their backs. But if you really want to change behavior, you have to elicit solutions from the people you're working with. And when you stop and think about it, you have an incalculable amount of creativity out there that you're paying a lot of bucks for in salary, commission, whatever. And you're not using it. And they're the people who know the job best. So you gotta draw them out in order to change behavior there. Feedback is another important thing. Without feedback, you really cannot manage effectively. Let me give you a little scenario, and you'll see what I mean. Let us assume that for some reason You have to make a driving trip. You want to be 50 miles down the road in 1 hour. It's important to you. You're going to be rewarded if you get 50 miles down the road in 1 hour. The only caveat here is that you cannot average over the 55-mile-an-hour speed limit, if there's a 55-mile-an-hour speed limit. But you cannot average over that. Well, you say to yourself, well, Well, how about the traffic? Yes, we're going to remove all the traffic. All you have to do is drive down the road, be down there at this exit in 1 hour without exceeding, averaging over the 55-mile-an-hour speed limit. You may say, well, can I go over the 55-mile-an-hour speed limit? Yes, you can go over, you just can't average over the 55-mile-an-hour speed limit. So you're going to calculate in your mind and say, well, I can do that. If I average between 50 and 54, you know, easily achieve that. I can be 50 miles down the road. So you accept the assignment, you're motivated to go and do it, but before you begin driving, the individual who gave you that assignment, the individual who's going to reward you for doing it, comes in and removes the speedometer, removes the odometer, removes your timepiece, removes the radio and takes all the signs down along the way. Tell me how you feel now. You feel the anxiety. You feel the frustration that managers feel when you say, "Here's what I want you to do." That individual people you're managing feel when you say, "Here's the end result I'm holding you responsible for." When you build a feedback system that give them the information necessary to say, what can I do differently to close the gap? The development process starts to take place. Reinforcement or measurement is another important component here. Edward Deming, some of you may remember, he was a quality guru, died about 10, 15 years ago. Credit it with making Japan an economic powerhouse. But Edward Deming said something that perhaps was very profound. He said, "What gets measured gets done." What gets measured gets done. Now I know a lot of you are thinking, well, you know, we measure our people. After all, we have an MIS department or we have a computer, and that tells us at the end of the month the kind of progress they made. I'm going to tell you right now, using the monthly reports to measure progress is like driving an automobile by looking out the rearview mirror. It's too late to do anything. It's too late to do anything about last month. What you have to have is a weekly feedback system, and lots of that feedback is coming from the individuals. Now needless to say, you need that monthly feedback system to measure what they're saying against what's really happening out there. But you need that weekly feedback system on the actions they're taking to bring that goal to fruition. Without a measurement system, without some system to measure them, you're losing the opportunity to catch them doing things right. If you have a measurement system where you can recognize them for what they're doing on an ongoing basis, where you can catch insignificant improvements here and insignificant improvements here and jump all over it, you're going to begin to create an environment in which people develop themselves, and they will develop themselves. And you know what? They also motivate themselves. They motivate themselves when you say, "Tell me how you do that," or, "Tell me what you're going to do. What are your plans to close the gap here?" As they begin to tell you, they begin to motivate themselves. The work itself becomes a motivator. And when you turn around and say, "You know, you did a good job here," or you say, "This is what you indicated you're going to do this week," in order to close the gap, and you made a note of it on an interview guide. You motivate them through responsibility. When they see you making a note of what they say they're going to do, they know you're going to follow up if you make a note of it. And as a result, what are you doing? All you're doing is prioritizing these things. That's our job in management. Our job is setting the priorities, and we do not set the priorities unless we're into it on a weekly basis. You talk to a person once a month, and you're not setting priorities. Now, some of you say, "Well, Vince, you know, I can't because of all my other responsibilities. I cannot meet with my people every week." Well, let me tell you the relationship between that and behavior change. Weekly meetings bring about substantial behavior change in a short period of time, and it changes them in tiny increments from week to week because you're focused on the end result and drawing the activity out of them. You see, you have to be married to the end result and draw the solution to getting to that end result out out of them. When you draw it out of them, they come up with the ideas for bringing about the behavior change. Now, if you do it on a weekly basis, you bring about rapid behavior change, but almost insignificant from week to week. But if you looked at it a month, two months later, there's been substantial behavior change. When you try to change people in fell swoops, that's not going to take place. You're going to see a lot of resistance out there. The other side of that is that the— if you do it on every other week basis, you still bring about behavior change, but at a much slower pace. And if you do it on a monthly basis, it's even slower. And if you do it beyond once a month, forget about it. You're wasting your time. You're not going to bring about the behavior change you're looking for. But this weekly interview is extremely important because you're catching people doing things right. Some of you may have read a number of years ago a book by Tom Peters, In Search of Excellence, and he talked about walking around management. And that's what walking around management is all about. It's catching people doing things right. Because if we catch people doing things right on an ongoing basis, they're going to do more things right. We create an environment in which people want to succeed. And if that environment is not there, You have to assume responsibility as leaders. You have to assume responsibility. It doesn't start from the bottom up. Success in the organization starts from the top down. I often tell managers, presidents, when I work with them, I help them see a performance management system, help them implement a performance management system, and then, if I did not go any further than a CEO But if he were to do that, implement that performance management system on a weekly basis, I will guarantee you in 2 to 3 years the whole organization is managing that way. Success starts from the top down, not the bottom up. All I do when I work with a company is accelerate the process by working with lower-level managers in addition to the CEO. Reinforcement.

Reinforcement.

I got to be conscious of my time. Bill will cut me off here. Reinforcement is another important component. It's really creating that motivating environment out there. And so many managers go about this incorrectly. So many managers think they're creating a motivating environment when they bring their group together and have a general meeting and they get up and say, 'Boy, did we have a lousy month, and we're going to have to work harder out there to reach our objectives.' Well, they're creating a motivating environment, but for the non-performers. The non-performers are sitting there and they're saying, 'I'm not alone, everybody's doing a lousy job.' And the performers are saying, 'Hey, how about me? I did a good job. Maybe the company as a whole did a poor job, but I did a good job. When managers have group meetings, they gotta reinforce the positives. Now, one of the reasons they try to cover everything in that meeting, and they really neutralize the good things with that kind of an approach, is because they only hold that kind of a meeting to communicate with their people. The personal development interview permits you to handle these meetings differently, because in the general meeting What you're pointing out is what people did right. You're saying Susan does a super job in this area and Bill does a great job in this particular area. You're setting standards. And just the reverse is happening when you get up and say, "Boy, did we have a lousy month." Just the reverse because the first person I bring in after that is the non-performer. And I sit them down, I want to talk I talk to them about their performance, and I already gave them the crutch. I already gave them the crutch. I say, "Well, John, I'd like to talk with you about your lack of performance in this area." And they say, "Boss, what are you picking on me for? You just said the whole organization is doing a lousy job." You've got to kick the crutches out. And the way you kick the crutches out is in your general meetings, you're hitting on all the positives. 3 basic things in a general meeting. Instruction, information, and inspiration. The 3 I's. That's what you do in a general meeting. On a one-on-one, we're going to be talking about the individual performance, and we're going to be developing these people. We're not going to be doing it from a standpoint, "You're doing a lousy job, here." We're going to first pick out what they're doing properly, get them to tell us about it, and then we're going to say, "What do you think you can learn from that?" to improve in this area? And then we're going to hear a pregnant silence as they go, "Mm, uh, uh." But don't worry about it. If you're doing this week in and week out after a short period of time, what you're going to find is that they're going to start to come up with answers. And when they start to think about the solutions before they come in, then they start to solve the problems without you getting involved. In other words, this doesn't take place overnight, but it takes place as a result of implementing a performance management system. And the most important area is coaching. You utilize all the concepts you've learned at the Kennedy-Glaser operation here insofar as coaching, but The couple of things you've got to know about it, we talked about, you are not the know-it-all guru. You cannot be the know-it-all guru. What you've got to do is draw these solutions out of people. If you draw the solutions, "How did you do that?" or "Can you tell me what you're going to do to improve this performance?" Two things are going to happen. They're going to start moving in that direction, and it's going to reduce your talk time. Managers can't take silence. When they keep quiet in the interview, if more than 10 seconds go by, they want to speak. As a result, they take the pressure off the person who should have the pressure on them, the person performing the job, and not pressure that you're putting by your approach, because your approach has got to be understanding, empathetic, and you're interacting with people, you're trying to pick them up. But the approach of getting them to come up with solutions, the approach of empowering them. They're the basic components of a performance management system. If all those components are employed, you'll see these problems, these symptoms that some of you may identify as problems, disappearing after a short period of time. It's not going to go from night to day in one fell swoop. If it were that easy, anybody could do it. But as long as you work at it, and it's not difficult, it's very easy to get it started, as long as you work at it on an ongoing basis, you're going to start to see change. The change you're looking for. And once you have an effective performance management system in place, it's going to become a vehicle for continuous improvement. Continued organizational growth. But you have to look at it strategically, long-term. If it were easy, that easy, changing it in one fell swoop, people would have done it. But this is the kind of thing that all growing companies go through. When they start out in the growth process, it's a centralized type of management. But as they begin to grow, they have to start delegating. They have to start restructuring. And when they do that, they have to have an effective system to do that. Now let me share a conversation that I had with Bill Glazer back in February. As Bill indicated, I started working with him a number of years ago. And the one thing that Bill did that I see so often not being done, is implement. He didn't pay for me and then not take that information and use it. He implemented, and he implemented it very, very effectively out there. And we have been friends, and he's contacted me on numerous occasions, and I've contacted him, being the marketing guru out there. You can change your organization and using a performance management system to do it into a real vehicle for growth. I want to thank you for your kind attention, and I'll be happy to answer any questions you may have in the back of the room. Thank you very much.

Thank you for listening to the Magnetic Marketing Podcast with Dan Kennedy. If you love hearing in on these lost Dan Kennedy talks and speeches and calls, then please let someone else know about this podcast. That's how you can help it to grow, and the more it grows, the more free Dan Kennedy we can bring to you. Also, Dan would love to give you the most incredible free gift ever, designed to help you make maximum money in minimum time. This free gift comes with almost $20,000 in pure money-making information for free, just for saying maybe. You can get this gift from Dan right now at NoBSLetter.com. Not only do you get the $20,000 gift, you also get a subscription to 2 marketing newsletters that will be hand-delivered by the mailman to your mailbox each and every month.— one from Dan Kennedy and one from me, Russell Brunson. To get this gift and your subscription, go to NoBSLetter.com right now.