1. Magnetic-North Consulting organization, people, and process integration services 1 Performance Engineering to Create Dramatic Change in Business Results C M N agnetic North Consulting Right Direction. Done Right.

2. Magnetic-North Consulting organization, people, and process integration services 2 Science vs. Engineering 1 Scientist Engineer Scientist Engineer There is so much to know and discover There is so much we know that we have not applied Satisfied to find out what the world is like as it is Intent on remaking the world Has a well developed process and will go where it leads Knows where to go and will use any process to get there Knowledge is an end, valuable and worth great cost to attain it Knowledge is costly and needs to be applied efficiently where value is created 1 Human Competence: Engineering Worthy Performance. Thomas Gilbert. New York: McGraw Hill. © 1978

3. Magnetic-North Consulting organization, people, and process integration services 3 Worthy Performance (W) ► Egyptian pyramids vs. alphabet ► Education must be economical ► We have no need to measure behavior until we have measured accomplishment ► Measures of behavior can be misleading and measures of accomplishments are required W = Valuable accomplishments (A) Costly behavior (B) Valuable accomplishments (A) Costly behavior (B)

4. Magnetic-North Consulting organization, people, and process integration services 4 Measuring Human Competence ► Mark Spitz 20% faster than best high school swimmer ► PIP is a measure of competence we have and potential to increase ► Reducing a PIP of 4.0 to 1.5 is easier than reducing a PIP of 1.2 to 1.1 ► Key is to find out what makes the best, the best (6 areas to be discussed later) Potential to Improve Performance (PIP) Worthy Performance (best) Worthy Performance (typical) Worthy Performance (best) Worthy Performance (typical) = =

5. Magnetic-North Consulting organization, people, and process integration services 5 Performance Engineering Model: Gilbert 1978 Behavior Cost Cost of workers’ behaviors (R) + Cost of environment (E) Cost of workers’ behaviors (R) + Cost of environment (E) = = InformationInstrumentsIncentives KnowledgeCapacityMotivation InformationInstrumentsIncentives KnowledgeCapacityMotivation

6. Magnetic-North Consulting organization, people, and process integration services 6 The Six Boxes™: Binder 1998 Carl Binder is doing work with Microsoft Game Studios (XBOX) and, in a nutshell, is finding that job outputs don’t match job descriptions—surprise! Expectations & Feedback Expectations & Feedback Tools & Resources Tools & Resources Consequences & Incentives Consequences & Incentives Skills & Knowledge Skills & Knowledge Selection & Assignment Selection & Assignment Motives & Preferences Motives & Preferences

7. Magnetic-North Consulting organization, people, and process integration services 7 Creating Incompetence PPerson’s repertoryof behavior Knowledge 1.Leave training to chance 2.Put training in the hands of supervisors who are not trained instructors 3.Make training unnecessarily difficult 4.Make training irrelevant to the students’ purposes Capacity 1.Schedule performance for times when people are not at their sharpest 2.Select people for tasks they have intrinsic difficulties in performing Motives 1.Design the job so that it has no future 2.Avoid arranging working conditions that employees would find more pleasant 3.Give pep talks rather than incentives to promote performance in punishing situations S D Information R Instrumentation S r Motivation EEnvironmentalSupport Data 1. Don’t let people know how well they are performing 2.Give people misleading information about how well they are performing 3.Hide from people what is expected of them Instruments 1.Design the tools of work without ever consulting the people who use them. 2.Keep the engineers away from people who use the tools. Incentives 1.Make sure that poor performers get paid as well as good ones 2.See that good performance gets punished in some way 3.Don’t make use of non- monetary incentives

8. Magnetic-North Consulting organization, people, and process integration services 8 PE Example: Syracuse Lacrosse 1 ► 2007 Record: 5-8 ► 2008 Record: 11-2 National Champion ► Top 5 scorers were the same from 2007 to 2008 order changed slightly ► Bench support about the same ► Slight improvement in winning face offs ► 2008 goalie slightly better than 2007 goalie How can we pinpoint the reason for the significant increase in performance: a little improvement in a lot of areas, working harder? 1 James Land. ww.laxnews.com

9. Magnetic-North Consulting organization, people, and process integration services 9 Performance Engineering Analysis Results 1 ► Sid Smith: Defense (middle) ► Junior transfer from Onondaga Community College ► Cut the goals allowed per game to 4 ► In Semi final with Johns Hopkins, held Hopkins attack to 3 goals I asked Sid after the Championship game how he and the 'Cuse D were able to force Hopkins to have twice as many turnovers as Syracuse had in the Championship game. Ever humble, he said that Danny Brennan won so many face offs for the Orange that it was easy to pressure the Blue Jays. I told Sid that Brennan was great all year, but that Face offs were actually even in the Championship game, 13-13. Sid thought for a minute and said it was the offense that took the pressure off the D and made Hopkins think they had to make moves. I think he was simply trying to spread the credit around. The bottom line is that the difference in the game, and the season, for Syracuse was Sid Smith. 1 James Land. ww.laxnews.com

10. Magnetic-North Consulting organization, people, and process integration services 10 Where to start ► Differentiate between behavior from performance ► Define measures of exemplary performance based on desired business results ► Complete performance table levels 1-3 for sales force ► Find exemplary performer, troubleshoot performance, and complete Performance Engineering Model ► Determine cost/benefit of getting % of sales force to exemplar and whether this will get desired business results ► Pilot test and apply solutions based on Performance Engineering Model results ► Regularly revise performance table to determine effectiveness of solutions