Six Things Every Credit Union Should Be Doing to Turn Their Workspace into a Competitive Advantage: Article Five: Measuring and Benchmarking Your Workplace

by Michael Downs, Momentum, Inc.

Article One: Defining the Workspace

Article Two: It’s About Your People: Understanding Your Most Valuable Asset

Article Three: A Strong Brand Starts at Home: Building Your Brand in the Workplace

Article Four: Evaluating Short and Long Term Occupancy Options for Your Credit Union

 

Credit Unions of all sizes routinely apply measurements and benchmarking techniques to a wide range of business activities. In doing so, one of the biggest challenges Credit Unions face is monitoring and measuring all outcomes—both the intended results and the unintended consequences—of any given change. However, the strategic measurement of an organization’s physical space is frequently left out of the equation.  By developing and implementing a systemic approach to workplace measurement, businesses can better track and assess both the anticipated and unanticipated results of change.  Once developed and implemented, measures and benchmarks should add value and improve results by aligning directly with the Credit Union’s short and long range goals.

Because holistic thinking is not always applied to workplace measurements, facility changes can produce unintended consequences.  Two examples include:

  • A move to cut real estate costs may save hundreds of dollars in the short term, and also have the unintended consequence of costing thousands of dollars in increased turnover and absenteeism.
  • A shift to a more open environment may save hundreds of dollars in reconfiguration costs, and also have the unintended benefit of speeding product development time.

Historical Context
In an old-line factory, the worker was part of a predictable, repetitive production process and the goal of management was to neutralize worker differences in an effort to achieve consistent performance. Workers accomplished clearly defined tasks. If one person quit, a replacement was quickly found, and given the exact same tasks. Opinions were not sought, individuality was not encouraged, and conformity was highly valued.

During that time, measuring performance was easy: quantity, quality, and speed of work were all assessed in direct correlation to product volumes, defects, and production times. In the same way, it was simple to track and assess the effects of physical changes to the workplace. If changes decelerated production, they were bad. If changes improved production, they were good.

In today’s economic environment of knowledge workers, the role of each worker in the organization is much more dynamic and significant. The individual’s contribution defines his or her value to the organization and the goal of management is to stimulate more robust performance in an effort to achieve improved business results. Because highly valued knowledge workers are difficult or impossible to replace, retention of employees has become critical to a Credit Union’s success.  Furthermore, as we outlined in our previous articles, the demographics of the workforce present new challenges and opportunities for Credit Union leaders.

Given these changes, measuring the performance of knowledge workers is much more qualitative than the straight forward assessment of old-time factory workers.  Measurements are often tied to overall business results, such as profitability, market share, and customer satisfaction.

Assessing the performance of knowledge workers is an important, but challenging component of workplace measurement. Knowledge workers often depend on the ability to collaborate with other workers to analyze problems, create original solutions and produce results.  These collaborative teams may require mobility and flexibility to accomplish a wide variety of duties.  As a result, the workplace can have a huge impact on the quality and pace of their work.

Intangible Considerations
It should be noted that some of the most important assets to a Credit Union are intangible, and therefore invisible.  With that in mind, the most important of these invisible assets to a Credit Union is its ability to collaborate. The decision that an employee makes to share an idea or to spend the extra hour helping out a fellow employee usually means the difference between “average” and “great.”  So, how do you measure the invisible?  And, if the Credit Union cannot measure it, how can it manage it?  Although these items do not show up on a balance sheet, it does not mean they aren’t real or cannot be measured.

Over the last few years, a concept called social network analysis (SNA) has emerged as a influential new way for managers to see the patterns of interaction.  This includes information sharing, problem-solving, coaching, and mentoring, and they make up the less visible, often informal side of a Credit Union. By asking simple survey questions online and identifying the people with whom they most frequently interact, SNA makes it possible to understand the interactive networks that underlie or exist in parallel to the formal organization charts and process diagrams. Continuous surveys can reveal changes in networks or in patterns of collaboration, which makes it possible to assess whether interventions such as reorganization or targeted efforts to improve collaboration actually have their desired impact.

Therefore, in developing workplace measurement systems, Credit Union leaders should also incorporate measures for intangible factors in the workplace. By doing so, the organization will better identify its most critical intangible assets, how those assets are being cultivated, and what changes need to made to improve them.

Approaches to Workplace Measurement
While there are numerous workplace factors that a Credit Union can measure, the best practice is to use multiple factors in combination.  One should also bear in mind that new measures continue to evolve that can aid the Credit Union in tracking the role that the workplace plays in:

  • Enabling new ways for people in organizations to work
  • Valuing the individual
  • Shifting or reinforcing culture and image
  • Implementing new technology
  • Facilitating simpler, faster change
  • Achieving financial objectives—how workplace changes help achieve the organization’s goals

Below are some factors that should be included in any comprehensive workplace measurement model, covering virtually every facet of performance.  These provide an excellent starting point for developing a more holistic approach to measuring a Credit Union’s workplace.

  • Effectiveness.  The degree to which the workplace accomplishes what it set out to accomplish.
  • Efficiency. The degree to which the workplace accomplishes its goals with a defined set of resources.
  • Quality.  The degree to which the workplace conforms to requirements, specifications, or expectations.
  • Profitability.  The relationship between total revenues and total costs.
  • Productivity. The relationship between quantities of outputs from a workplace and quantities of inputs into that same workplace.
  • Work Life Quality.  The way employees in a workplace respond to sociotechnical aspects of that environment.
  • Innovation.  The degree to which creativity is applied to develop more functional products and services.

Checklist
It’s important to realize that the physical space of the workplace can have a strong impact throughout the organization, both internally and externally. Therefore, as a Credit Union is developing a plan and tracking its results, it must address three sets of questions:

  • What does the Credit Union want to accomplish? How will it measure success?
  • How is the Credit Union going to accomplish it? How will it assess its process?
  • How can space help? How will the Credit Union measure its impact?

By taking a phased approach, Credit Unions can help ensure that their measurement system will gather meaningful data and produce meaningful information. In addition, it will help ensure that all relevant results are measured on both sides of the cost-benefit equation.  An example of a phased approach is shown below.

Planning/Assessment

  • Review the Credit Union’s mission, goals, and values.
  • Define relevant strategic initiatives and elements.
  • Confirm goals for the functional departments that will occupy workspace.
  • Define objectives for workspace.

Development

  • Design workspace.
  • Establish measurement team.
  • Develop measures and targets.
  • Communicate measures and assess feedback.

Implementation

  • Assign responsibility to measure and document.
  • Communicate measurement results to the organization.

Review

  • Review results for progress.
  • Evaluate changes/improvement in workspace and measurement system.

Ideas
Several key factors significantly impact the development and implementation of workplace measurements: establishing agreed-upon priorities, tailoring measurements to needs, and gaining employee support.  As a Credit Union’s needs change, reassessing and refining the measurement system is important for long-term success.  Below are some considerations and ideas for developing and implementing a workplace measurement system.

Focus measurements on the Credit Union’s top priorities. Directly relate measurements to achieving the Credit Union’s goals. Revise or eliminate measures that are no longer meaningful to organizational goals.

Realize that measures are context dependent. A measurement that is appropriate for a particular situation may not provide the desired impact or have any meaning in a different setting. Customize measures to the activity and to the Credit Union’s goals.

Involve employees. The team that will develop, deploy, and manage the measurement system needs to include employees at various levels of the organization. Measurement systems devised by “experts” and imposed on an organization are likely to be rejected and ineffective.

Leverage employee involvement in measurement processes to refine the goals, metrics, data collection, and improvement opportunities.  Employee involvement in developing, implementing, and reviewing phases of the measurement process builds:

  • Knowledge of work activities.
  • Buy-in on measurement goals and processes.
  • Knowledge or measurement techniques.
  • Ownership in developing and implementing improvements.

Track, evaluate, and follow through on measurement results.  Establish and support a clear, well-defined process.  Without proper follow through, even the best measurement systems will ultimately fall short.

Understand the underlying objective. The ultimate goal is to improve the Credit Union’s performance in a particular aspect or activity. As the activity improves, evaluate and revise the measurement. To achieve continuous improvement, integrate the process for developing and implementing improvements into the measurement system.

Final Thoughts
Credit Unions of all sizes are constantly making decisions about their workplace, both tangible and intangible in nature.  As such, leadership teams need to understand the various ways in which their workspace decisions affect employees and their productivity.   There are several measurement models for analyzing employees’ relation to the workplace environment, not only to differentiate between the influences of different buildings, task types, and organizational culture, but also to develop tools and techniques to measure different aspects of the workspace itself.  The results of these models can then be applied to wide range of workspace decisions that will have lasting effects on the Credit Union.

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  • Davenport, T.H., Jarvenpaa, S.L., and Beers, M.C. “Improving Knowledge Work Processes.” Sloan Management Review. Summer, 1996: 53-65.
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Article One: Defining the Workspace

Article Two: It’s About Your People: Understanding Your Most Valuable Asset

Article Three: A Strong Brand Starts at Home: Building Your Brand in the Workplace

Article Four: Evaluating Short and Long Term Occupancy Options for Your Credit Union

This series is co-authored by Michael Downs and Greg Barrett of Momentum, Inc. Mr. Downs holds both a Bachelors and Masters of Business Administration, completed the ABA School of Bank Marketing at Southern Methodist University, and has more than twelve years of experience working with clients on strategic planning and marketing. Mr. Barrett holds a Bachelors of Science in Finance and has worked with and for financial institutions for more than nineteen years. Mr. Downs, Mr. Barrett and the Momentum team work with credit unions to facilitate strategic planning, evaluate facilities growth needs, and implement systems for ongoing measurement and benchmarking. Learn more at www.momentumbuilds.com or connect at www.twitter.com/plandesignbuild

Michael Downs

Michael Downs

Michael Downs is the Vice President of Client Solutions at Momentum, a strategic design-build partner that takes a people centric approach to helping credit unions across the nation thrive. Web: www.momentumbuilds.com Details

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