Benchmarks versus Targets: Boost your Team

Kristy Hines discusses taking a fresh approach to the performance management of your team.

Achieving financial goals within a business is a cold hard fact you need accept in order to have a sustainable business. However achieving your financial goals requires a team effort if you employee staff.

We are an industry that can be divided about targets. Some therapists embrace them and strive to achieve their targets for financial rewards, or purely for the self-satisfaction of their competitive nature. Other therapists dread this reality of their job — after all, they just want to give a nice treatment and a simple target structure does not have any consequence if they don’t hit their target.

In many jobs if they don’t achieve their target they are allowed to exist, week in, week out, providing the same results, growing more and more accepting of their performance. Discontent grows and you have the seeds of a negative working environment — from management and the employee.

Performance management of financial results of each team member is an important role of a business owner or manager. The most common way to measure staff performance is to look at the totals they generate for your business or to set targets based on your financial goals and hope they achieve them through their own skills and the training you put provide staff.

In a business that has part time, casual and full time how can you fairly measure the performance of each of your team members? Even if all staff are employed full time, comparing team member again team member is not always the best way to measure performance. As we know, each day can be varied; number and type of treatments, retail opportunities, productivity etc.

Benchmarks are an alternative way of measuring your team. Benchmarks are a measure of averages — the averages the staff member achieves with each and every client they service.

We have distinct areas across our industry we want to monitor to ensure business sustainability and ongoing growth. If your staff have consistently strong results in these areas you can ensure the future of your business and their position in it.

Within my workplace, Mineral Lifestyle, we monitor the following with benchmarks for individual performance:

Average service ticket: the average each client spends on services in a single visit
Average retail per service guest: product purchased in conjunction with a service
Rebooking percentage: client pre-booking their next appointment before they leave
90 day retention: client returning within 90 days following their appointment
Productivity: the amount of time a team member is booked in services

By monitoring your staff through benchmarks you can measure each team member’s performance fairly. Staff can no longer use the amount of hours or clients they have had as excuses for not achieving. Benchmarks drive your team to be consistent; every client matters towards their personal results.

While targets can be an overwhelming number that seems unobtainable, benchmarks offer the opportunity for a more achievable perception. Small improvements are measureable and achievable.

Many businesses create incentives just on retail or rebooking or both. To drive a sustainable business you need your staff to understand that being a successful and sustainable therapist goes beyond retail and rebooking.

They need to see their column like an individual business and evaluate at the beginning of the day their potential opportunities such as upgrading, booking in series of appointments, retail and relationship building to ensure ongoing client retention.

If we can educate our staff to see their column like a business, we will have a savvier employee. Any therapist with aspirations to have their own salon needs to understand this side of being a therapist and of a business.

As a business owner, implementing either a target-based or benchmark performance management program requires commitment. It is not something that will be embraced or even understood by your team initially. It requires an ongoing commitment from you to monitor and coach on these measures on a daily, weekly, monthly and quarterly basis. Even if you assign a manager to follow this up, you need to be checking on this regularly.

On the flip side, along with your commitment to monitoring and following up with each individual you also need to have a consequences structure. In the theme of the ‘carrot and the stick’ make clear guidelines for your team. While it is important to focus on the benefits and incentives for achieving targets and benchmarks there also needs to be a clear path of the consequences of not making progress within your business that can be followed without emotionally clouded judgment. This gives a clear path out of your business if a staff member proves not to fit your culture.

Too many therapists are allowed to simply exist in their position without achieving goals. With no consequence for not achieving benchmarks or targets, how can you expect them to get on board if they are just happy to take their wage each week?