5 red flags you’re not operating at peak performance

Macroeconomic factors like high interest rates, limited appetite for investment, war, an uncertain political climate, and the threat of a slowing economy all contribute to current pressures on organizations. Additionally, the end of the pandemic brought new stresses as demand shifted and some businesses found themselves overbuilt, requiring difficult restructuring efforts.

Continued waves of layoffs across various industries leave many employees feeling anxious and wondering if they could be next. As we move toward the final quarter of 2024, organizations struggle with employee engagement and general malaise or dissatisfaction. Many leaders are asking: How do I get my organization back to operating at its peak, and reach new heights?

Organizations are a collection of many different people and operate a lot like the human body with many complex interdependent systems with different functions, all requiring coordinated effort to operate well and effectively. Just like an individual trying to perform at their best, if something small goes wrong, it can lead to other things going wrong, too.

The key to organizational effectiveness is identifying which issues exist and taking the right proactive steps to address them. Here are the biggest “killers” of organizational effectiveness, and some solutions to address them quickly to push the limits of what’s achievable in your respective industry.

Slow to act

If you are too slow to react to changing dynamics within your company or your industry, you risk getting lapped by the competition. It can be demoralizing for employees, frustrating for customers, and send signals to your best and brightest that your organization is behind the times.

As Andrea Belk Olson noted, this can sometimes happen because organizations aim for perfection—but perfection is the enemy of good. It’s often better to get it 80% right, knowing some things need to improve and iterate quickly from there.

Solutions: Understand what things must be “great,” and what can be “good,” and prioritize your time and resources accordingly. Set internal timelines that feel aggressive, and if you need to slightly extend them for good reasons, do so. This will help you build a “culture of pace.” If you can make three decisions in the time your competition makes two, that will become a huge competitive advantage.

Meeting fatigue

Many of us have been in meetings you aren’t sure why you are attending, or what the meeting is trying to accomplish, or what the next steps are. This is highly inefficient. Flowtrace estimates the average working professional spends five hours a week in meetings and four hours preparing for them. It’s worse for managers, who spend close to 23 hours per week in meetings—roughly half their entire week. More than 65% of employees say meetings prevent them from getting their work done.

Solutions: Improving meetings, or having less of them, can be one of the biggest steps an organization can take to improve employee engagement. The first step most organizations can take is to ensure meetings have clear objectives. If the objectives aren’t clear, don’t have the meeting. Cut meeting times and constrict attendees to those who really need to be there. Send materials in advance, or give people time to read and discuss them—like Amazon, where employees must write well-structured memos. Meetings start with everyone reading so the topic can be well understood.

It’s unclear who can make a decision

Organizations often like to create a culture in which all voices are heard, input is gathered from all avenues and at all levels, with the well-reasoned belief that with more ideas, better solutions follow. The problem is that this strength can also become an organization’s worst enemy. If your organization isn’t clear on who ultimately has decision-making power, it can be hard for people to move things forward. A consensus culture can contribute to a slow culture—or one in which bad decisions or generic solutions are used in the spirit of compromise, which doesn’t differentiate you from a crowded competitive field.

Solutions: For big organizational decisions, ensure it’s clear who decides using a formal decision rights matrix. In meetings, be clear who has the ball, and who makes the call. Train managers on the different types of delegation. Often managers assume either they decide, or the employee has full independence. In reality, there are a lot of options in between these two that are often more effective and empowering.

Employees aren’t clear about what is expected of them

Gallup conducted a meta-analysis across more than 110,000 teams and found the most fundamental employee engagement element is employees understanding what is expected of them. When that goes south, productivity, engagement, retention, and customer satisfaction all drop. This can happen for a host of reasons: managers don’t communicate expectations well, job descriptions are unclear, feedback is not provided regularly, expectations shift or are inconsistent, or employees don’t have the training and resources to do their job well.

Solutions: Create a culture of effective goal-setting and make sure your organization understands your objectives and where you are heading. Start at the top using tools like the one-page strategy/OGSP and cascade that down to teams to help individuals tie their work back to the bigger picture. Ensure managers and employees have regular, short check-ins where progress, feedback, and goals can be reviewed and adjusted. Require all roles to have a role description. Ensure every hire has a set of goals that outline what success looks like for the first 12 months. Survey teams regularly to identify where role clarity gaps exist, and jump in quickly to resolve them.

Lack of incentives or misaligned incentives

As Charlie Munger said, “show me the incentive and I will show you the outcome.” Incentives very clearly drive behavior. If your organization doesn’t have the right incentive structure, it can feel like your company is stuck in quicksand—you know where you want to go, but people aren’t moving. Misalignment can arise when immediate incentives don’t tie to long-term strategic goals, or are too generic and therefore don’t consider the different roles and needs of various employees. Often they can be due to poorly defined metrics—either they are too complex to understand, or are not well-defined enough, so people aren’t sure what success looks like.

Solutions: Ensure incentives are tied to company goals and outcomes, both financial and nonfinancial. Create the right balance between short- and long-term incentives. Keep it simple: use a few, clear, measurable metrics that everyone understands. Finally, get transparent. If you are frequently sharing the results of the metrics that matter, people can adjust quickly and help find innovative ways to hit the target.

Today’s business environment is defined by constant pressure and shifting sands. But this also represents a unique opportunity to gain ground on your competitors. By eliminating these five killers and turning them into strengths, your organization will transform into a peak performing machine.

Focus daily on each of these five areas: establish a culture of pace, reduce or eliminate ineffective meetings, ensure decision-making is clear, set goals for each employee linked to what matters most, and create a compelling incentive system. Once in place, each of these will reinforce the others and you will have a competitive advantage that is the envy of your industry.