Every business entity has a system in place for performance appraisal, with defined set of KRAs (Key Result Areas) and KPIs (Key Performance Indicators). When it comes to leaders, most of these metrics are revenue based or sales based. Even though that is indeed a good indicator of performance, it doesn’t truly represent a leader’s overall capability to run a business unit or team. What we need is a more holistic view of the success of a leader. For this purpose, I propose the TIPS (Team outcome, Individual contribution, People and Strategy) framework, that can be used both for qualitative and quantitative assessment.
All the four elements in the TIPS framework are not independent from each other. Each of them, either has an impact on one or more other elements, or are impacted by them. I will try to map these interdependencies while taking you through the four elements.
A leader always leads a team or more than one team. He should be able to guide, motivate and inspire his team members. This will not only help to improve employee engagement, but will result in a high performing team that meets its milestones and delivers high quality work. Many successful business personalities have seen leadership as a tool to enhancing the ability of team members to manage themselves.
Steve Jobs says that the best employees are the ones who can manage themselves and they can do it only if the leadership has absolute clarity on what they intend to do.
So a leader’s decisions and actions have a significant influence over his/her team’s outcome. A good leader is one who can ensure that each and every member of his/her team is provided with the adequate support and resources to perform his/her tasks.
Since a team’s performance is a reflection of all these, team outcome is an effective metric to evaluate leadership abilities.
Like every other employee, a leader should also make rich individual contribution to his unit’s work. His/her work should be characterized by quality, timeliness and reliability. A leader should also be able to see the big picture and architect products, solutions or service offerings to cater to customer and market needs. Leaders should also be clear about their roles and responsibilities in terms of achieving the organization’s business goals. This will help them to channel their efforts in the right direction, thereby improving individual performance.
While a leader should facilitate learning and development avenues for his team, he/she should also focus on self development through workshops, webinars, certifications and using other online and hands on learning opportunities.
Individual contributions mostly convert directly into business outcomes. Given this, leadership quality can be considered directly proportional to positive contributions.
Beyond doubt, leaders should have excellent people skills. We spoke about ensuring team outcomes and how important it is for a leader. However, with all the enablers in place, you cannot create a highly engaged and motivated team without adequate people skills. According to Portland Business Journal, people skills can be described as:
- The ability to understand and empathize
- The skill to interact with others to develop a good working relationship
- The capability to build trust to have a positive impact on others lives
Compassion and empathy is one of the essential qualities that will help a leader stand out. Leaders have to put themselves into the shoes of their team members to be able to address any issues or concerns they have.
Also, leaders need to create an employee friendly working environment with necessary support mechanisms in place. Employees need to be given certain amount of flexibility in terms of working hours, leave policies, work location etc. All of these contribute to creating an inspired workforce with high level of commitment and dedication.
In a nutshell, leaders have a great role in creating a happy workforce. Hence measuring their people skills is a powerful technique to assess their fit to the team and the organization.
As mentioned before, leaders need to see the big picture. Good leaders are visionaries and work not just to meet short term goals, but to build a sustainable and high growth enterprise over the long term. They approach all the facets of business with a strategic mind and come up with innovative ways to achieve their business goals. They always alternate options to solve a problem or address a customer issue.
And why is it important for a leader to have strategic thinking? Here is why:
- It helps them build a stable workforce over time with close to little attrition
- Proper strategy makes it easy to align team goals with organizational level goals
- It encourages them to build systems to promote long term development
- It helps them to allocate resources appropriately
In short, strategy is an inevitable component of a leader’s DNA. And his/her strategic acumen is a good yardstick of leadership capabilities.
This framework is designed to help businesses evaluate the quality of their leadership beyond the dimensions of top line improvement. You can customize this to suit your business and industry.