I still laugh about this phrase a friend used to describe his company’s expectations. He worked for a Fortune 1000 company. Each year, it seemed that the performance goals were raised to the point that they were not achievable. But is that really true? Are other people getting over the performance bar- even one that was set on fire?
Let’s look at performance from the view of you, the owner. Are higher expectations reasonable? More specifically, is better performance needed for the profitability of the organization?
We all know John Deere as the maker of farm tractors and other equipment. Deere equipment is sold through dealerships- much like cars are sold. The company says these distributors “need to match the sophistication and size of agribusiness customers.” Deere expects these distributors to “know the local turf and market the product more effectively than a big corporation could... But if the retailers are too small scale, the inefficiencies could outweigh the advantages.”
What are the smaller distributors missing? Not enough skilled staff to service farmers. No technology to effectively track inventory. Not enough capital to pay Deere for inventory on a timely basis. The bottom line: dealers must meet performance expectations or lose their right to sell Deere products.
Is Deere’s position necessarily bad? If other, better-performing dealers can pick up the slack for poor performers who leave, isn’t the customer better off?
The Lesson: When considering raising expectations for employees consider if the goal is reasonable for the worker. Weigh that against the benefit to your customer and your bottom line.
Your Homework: Do you have an employee or business segment that seems to underperform year after year? If so, have you considered raising the performance goals?
(Source: “Why Deere Is Weeding Out Dealers Even as Farms Boom”, Wall Street Journal, 8/14/07)
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