Businesses today face a totally new set of challenges. They operate in an environment which is changing at a faster pace than ever – a pace that only seems to be accelerating.

Digital transformation, accelerated innovation and hyper competition are affecting every company, in every industry, forcing organisations to fundamentally re-examine how they operate. No wonder that the Boston Consulting Group predicts that nearly a third of US companies are likely to die over the next five years.

To get ahead in this new world, businesses need to focus on two key approaches. Firstly, they need to ensure that they are putting customers at the heart of what they do, achieving topline structural growth by improving consumer loyalty, customer experience and innovating to deliver what the market requires. At the same time they need to be getting the best out of their people through a managerial approach – in an increasingly knowledge-driven economy, the skills and experience of employees are central to sustained organisational effectiveness.

Both of these approaches rely on feedback, from customers and employees respectively, to drive improvements. Listening to what they are saying, and using this insight to fuel change, is crucial. In this article I’m going to focus on the managerial/people side of the equation to look at what needs to be done to turn feedback into business advantage. Essentially it comes down to three factors – engagement, alignment and leadership – if you want to achieve organisational effectiveness.

Engaging with your staff

Most businesses understand the importance of employee engagement – after all, engaged staff tend to be more productive, stay longer and contribute more. Essentially what engagement does is boost your efficiency – staff go above and beyond in their jobs, they achieve more, and, because they are less likely to leave, your hiring costs are reduced.

It costs the equivalent of a year’s salary to replace a member of staff, showing the impact that greater engagement and retention can have on the bottom line. Greater engagement comes from listening, and acting on feedback. This means moving away from an annual employee survey to introducing new modes of feedback, such as quarterly pulse and weekly ‘heartbeat’ monitoring.

Aligning with your aims and culture

However, employee engagement can only take you so far. Staff can be engaged and enthusiastic, but not focused on your company strategy. They are productive, but not delivering on the right things. Closing this gap requires you to break down barriers and create an open culture that is driven by always-on feedback.

This can be daunting – letting all employees share their thoughts, whenever they want, and ensuring you act on their feedback requires organisations to be flatter, and more transparent. Yet, the benefits are enormous – managers have access to broader insight and staff are both engaged and aligned with the organisation’s goals. The result? Effective staff operating in a culture of continuous improvement.

Turning managers into leaders

The third factor necessary factor for organisational effectiveness is leadership. What is needed is to move away from the concept of top down leadership, to creating leaders across the organisation.

All managers should see themselves as leaders and be continually looking at how they improve their performance by listening to, and acting on, feedback from all those around them. It is about continuous performance management, with managers able to ask for, and receive, feedback at any time, appraise their own performance and work with their teams to create new innovations and solve any issues that are holding the business back.

In increasingly competitive and fast-moving markets businesses need to get the best out of their people if they want to survive and thrive. Building a strategy that delivers organisational effectiveness is central to meeting these challenges – and it all starts with listening to your employees, and acting on their feedback.

Thank you! Your subscription has been confirmed. You'll hear from us soon.