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Beyond the Stigma: Do KPIs actually work?

Posted by: Charis Fisher 28 Feb 17  | Advice |  Hints and Tips |  Life at Work |  Opus News |  Recruitment


Q&A with
Tom Hurley and Tom Ponting, Permanent Team Director and Regional Director at Opus Recruitment Solutions’ Bristol office

KPIs get a lot of unwarranted bad press. However, if used correctly, they can be a brilliant and motivational management tool, particularly for sales-driven industries such as recruitment.

With more than a decade’s worth of experience combined in setting KPIs for recruitment teams, we asked Opus’ own Tom Hurley and Tom Ponting how they manage the challenges and misconceptions surrounding KPI strategies.

How do you motivate your team and get them to buy into the KPIs you’ve set?

Tom Ponting: We do hold ourselves accountable when it comes to KPIs – as well as regularly involving our own teams in KPI decision-making, every year we hold a meeting called the Excellence Conference where we check the KPIs we are setting are still relevant, trackable and fit for purpose.

Above all, it’s about following a formula that works – our method has been proven to be effective as every person that has hit this formula at Opus has become a big success. That includes consultants who have joined us with no previous sales training or recruitment experience.

Take Freddie Short – he joined us in July 2013 straight from university with no knowledge of sales or the recruitment industry. Within 18 months, he’d been promoted four times to Team Leader and reached a personal best of £10k GP per week. He’s now our Contract Division Manager.

We could tell Freddie was going to be a big success in the same way as we can tell with any high-performer on the team – he always consistently hit his KPIs and was always striving to achieve more.

Tom Hurley: Education is a very important aspect too, though. If people don’t understand why they are supposed to hit KPIs, they will go against the grain just for the sake of it. You have to explain the reasons behind the KPIs you’re setting for people to want to follow them.

Ponting: Monitoring performance statistics allows our teams to spot trends in their own working patterns and improve. They can, of course, get help and advice from us on how to achieve better results and provide a better client/candidate service.

KPIs have to be used in combination with clear support from team managers to get the best outcome for everyone.

How do you make sure the KPIs you set align with your overall business strategy?

Hurley: KPIs are intrinsically linked to long-term business goals – if your KPIs aren’t working neither will your strategy. This kind of tool isn’t meant to be used to set unrealistic aims for individual consultants, as can often be the expectation from people without any experience of recruitment.

You can tell a lot of things about the health of your business as a whole from KPIs – what your weaknesses are, what the company needs to improve or how close you are to hitting your targets.

Trust and KPIs are intrinsically linked, though. For trainee consultants who are unfamiliar with a target-driven approach, we provide them with evidence that these strategies work. We share case studies of Opus consultants who have progressed from hitting new starter KPIs to becoming top billers to show how much it is possible to achieve here.

There IS a correlation between deals made and KPIs or, let’s say, between success and KPIs.

KPIs are effective as a way of managing and educating new starters on how hard to push themselves and helping them learn what they are capable of.

Ponting: What it’s important to understand about new starters is that they don’t tend to understand KPIs at first and need a lot of education as to the how and why behind their targets.

With experienced consultants, KPIs will tend to differ as recruiters naturally improve with experience. You do have to alter KPIs accordingly so they are tailored to the individual consultant’s performance – think about what is realistic for them and how that relates to your overall business goals.

To give one example, Sam Miller is Associate Director at Opus, specialising in the software testing market. She is a really outstanding recruiter with one of the highest interview to placement ratios we’ve ever had at Opus. Now imagine how you would feel as a new starter if the targets set for you were the same as the ones sets for Sam. It’d be very demotivating.

Hurley: That’s true - having the same KPIs for junior and senior consultants doesn’t make any sense.

Ponting: That is why educating new starters on WHY KPIs are needed is so important. Even in the interview process, we’re already explaining what KPIs are used for and why they don’t live up to their negative image.

Do you think KPIs and company culture are linked?

Hurley: Every sales-based business uses KPIs in some form or another – KPIs aren’t fundamentally at fault if they are relevant and correctly used.

Ponting: But you have to consider that it is a really stigmatised word. New starters in particular can be put off or react badly to it. The reality is that KPIs can be your friend and your ally – it’s just data used to improve your performance. Consultants being aware of how well they are doing should actually create a positive working environment – one where people help each other out and want to challenge themselves.

Hurley: We’ve recently invested in a new data visualisation software called Northstar, which has been transforming the way we manage performance. With this advanced technology, Opus have the ability to assess performance using clear visual indicators that identify the key areas for improvement.

We’ve seen motivation levels soar as a result – it’s been great for our consultants to have a hands-on resource to help them monitor their progress.

Tom Ponting will be discussing how to motivate teams using KPIs in more detail in next month’s Recruitment Grapevine magazine

Interested in pursuing a rewarding and challenging career? Why not see if one of our global recruitment roles could be for you – from a trainee in Bristol to an experienced recruiter in Amsterdam or New York

 

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