Why Outcome-Based Management is Key in Developing Trust in Hybrid Working Environments.

“Your work is more than your to-do list. And so is your team’s. But are you treating them like to-do lists or people?” (Berger, 2019).

We’re seeing many managers in new waters of how to lead their teams, when their existing methods don’t seem fit. Since the Industrial Revolution, workers went into the factories whilst supervisors watched over to ensure each task was completed correctly, where jobs were simplified and repetitive to increase productivity - overwise known as Frederick Taylor’s theory of scientific management (De Smet et al, 2021). Fast forward to 2021, the result of this supervision (input management) has become difficult, tiresome and damaging at its worst (Harper, 2019). 

You cannot supervise every action of your team in a hybrid working environment, and those that are are finding themselves in a stressful atmosphere. 

Some businesses implemented desktop monitoring softwares, displaying a manager's lack of trust with their team and has continuously shown results of burnout. Indicating that input management styles still loom large in leaders’ management philosophies (Harper, 2019). 

We at WorkWell propose that an Outcome management style is essential for a productive hybrid working environment, not only developing trust but building motivation and innovation. 

But what is the difference between income, output and outcome management? (Harper, 2019).

• Input management: A performance management practice that focuses on the activities that produce those outcomes, focusing on the processes themselves. I.e. “walking the factory floor”

• Output management: managing a work process for the sake of whatever it ends with, such as a closed deal. A manager who puts too much weight on outputs in a hybrid working environment risks putting their team into burnout.

• Outcome management: Focuses on the results themselves, by making goals transparent and empowering people to achieve them without attention to detail of how they get to it. As long as the team has achieved the goal, they don’t care about the how. A great way to bring teams together when moving in many directions.

What’s so great about Outcome management?

Developed in the late 20th Century, Andy Grove produced the Objectives and Key Results management framework (OKR), it proposes that when a shared outcome is significant and meaningful, commitment to that outcome can drive a workgroup to take action (Harper, 2019; Hagel et al, 2018).

A McKinsey report on successful organisations during lockdown found that by focusing on the outcomes an organisation is trying to achieve and why, managers can guide their team’s energies toward finding the right kinds of outputs that best suit them, whilst trusting their team to produce results (De Smet et al, 2021). 

It allows team members to work in a way that best suits them to create the best results, some like to write thoughts onto an online document, others like to think in their heads to produce the same results, but a desktop monitoring software will be calling you lazy. 

Additionally, there is a significant increase in the ability to staff cross-functional teams through outcome management, the quality of team-building events and delegation from leaders increase. Proving more human and effective. 

How to embed outcome management

• Define: Begin with a well-defined outcome that provides clarity, focus and guidance for making decisions. It should be clear, credible, tangible and meaningful.

• Accountability: Ensure to hold managers accountable for clarity of goals and outcomes, this will require regular training and communication between managers.

• Transparency: Transparent, 360 feedback from teams.

• Communicate: between team members and leaders to see how each member likes to work, to get an idea of how the team can work together.

• Review: Ensure the outcome is still the main focus and that there is full clarity for all team members on a regular basis.

We are helping businesses to build equitable and transparent hybrid working models, policies and guidance, get in touch at hello@workwellpcs.co.uk or join our mailing list.

References

Berger, B. (2019) Why great managers focus on outcomes, not output. MondayBlog[online]. Available at: https://monday.com/blog/teamwork/why-great-managers-focus-on-outcomes-not-output/ 

De Smet, A., Mysore, M., Reich, A., and Sternfels, B. (2021) Return as a muscle: How lessons from COVID-19 can shape a robust operating model for hybrid and beyond. McKinsey & Company [online]. Available from: https://www.mckinsey.com/business-functions/organization/our-insights/return-as-a-muscle-how-lessons-from-covid-19-can-shape-a-robust-operting-model-for-hybrid-and-beyond 

Hagel, J., Brown, J, S., Maar, A, D., and Wooll, M. (2018) Commit to a shared outcome. Deloitte [online]. Available at: https://www2.deloitte.com/uk/en/insights/topics/talent/business-performance-improvement/commit-to-shared-outcomes.html 

Harper, B. (2019) Hybrid WOrk and Outcome-based Performance Management. Medium[online]. Available at: https://medium.com/slalom-business/hybrid-work-and-outcome-based-performance-management-970db7886c29