A little more than 100 years ago, Henry Ford and his team revolutionized the world of automotive manufacturing, creating the first moving production line. That great innovation simplified the assembly of the 3,000 parts necessary to build the famous Model T, subdividing it into 84 distinct steps, performed by groups of workers with defined high-precision tasks, as the car being produced slowly advanced through the factory.
This was a revolution, which reduced the fabrication time of a car from 12 hours to 90 minutes, making possible a cost reduction for manufacturing of the product, previously considered a luxury. Purchasing a car became economical for the masses. This spectacular type of innovation is still a dream for businesspeople all around the world!
This manufacturing revolution drove the development of many new processes, including performance management, which is still practiced in similar ways in many organizations. It involves measuring the quality and quantity of work and providing feedback to the worker. We can look for concurrence between key abilities related to the job and those of the worker, and we can adjust or improve, if necessary, those of the worker, or invite them to work in another area more suited to their skills and interests.
What history doesn’t tell us is that, like Henry Ford pointed out in his book, “My Life and Times”, the company faced an extremely high annual turnover cost: as much as 378%, or the equivalent of 53,000 employees.
But we’re no longer in 1914, and that type of turnover is unfathomable. The ways of designing and supplying products and services has changed a lot; the world in which we live is obviously not the same. So that a company can remain viable, it will always be necessary to worry about efficiency and effectiveness, both for quality and to guarantee that it has the right profile for each type of employee, in the right place. Innovative companies also understand that performance management requires new ways of doing things. These include:
As an experienced consultant, I can say: “Let’s build it together, after a deep reflection around the realities faced in your situation, because there is not one unique recipe that can be adapted to all organizations.”
One thing is certain, however. It is necessary to recruit managers who have an understanding of all of this or that we will train in new ways of thinking, because the good old times, just like the Model T are really behind us…or in a museum close to you!
If you still have questions about the best way to optimize your organization’s processes, get in contact with us. We at Connect HR Strategy help our clients to improve organizational performance, implementing human resources management practices that incentivize the involvement of the employees.