Beyond Performance

How Great Organizations Build Ultimate Competitive Advantage

by Scott Keller , Colin Price

Number of pages: 304

Publisher: Wiley

BBB Library: Corporate Success

ISBN: 9781118024621

About the Authors

Scott Keller : Keller is a director in McKinsey's Southern California office, and a


Colin Price : Price leads McKinsey's organization practice worldwide and is an associate fellow


Editorial Review

Transformations that ignore health and focus only on performance are 1.5 times more likely to fail in the long run.  The good news here is that research and experience both tell us that performance and health are not in conflict, but are complementary. To see why, consider a sports team that is focusing single-mindedly on its performance. If all it thinks about is winning games and titles this season, it will have a rude awakening in years to come. It will have failed to recruit new members, develop the bench, secure stakeholder support, obtain financial backing, build community relationships, and so on. On the other hand, if the team takes steps to improve its health, it will improve its performance as well.  Recruiting promising new members will help it perform better in the future. In turn, performing better will make it easier to recruit new members and secure financial backing. A team that performs well this year is a product of superior financing, recruitment, and training in the past. In this way, paying attention to performance and health creates a virtuous cycle of sustained excellence over time. Both performance and health require action today, even though returns on investments in health may not materialize for many years.

Book Reviews

" In Beyond Performance: How Great Organizations Build Ultimate Competitive Advantage Keller and Price reinforce the decades of accumulating research showing that roughly 70% of organizational change programs fail. Central to that high failure rate are huge shortfalls in developing the “soft skills” of leadership and culture. This is what the authors mean by going beyond performance (“what an enterprise delivers to its stakeholders in financial and operational terms”) to organizational health (“the ability of an organization to align, execute, and renew itself”.) " The clemmer Group

"Most organizations are managed for mediocrity. The facts are clear: only a third of organizations that achieve excellence are able to maintain it over decades; even fewer manage to implement successful transformation programs. These statistics have devastating implications. In business, most of today’s companies will falter within 20 years. In government, the majority of reform programs will fail. And so will most efforts to create broader social change." Mckinsey and Company

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Wisdom to Share

If achieving sustained excellence means paying close attention to performance and health, how can leaders bring about significant and mutually reinforcing improvements on both these fronts at the same time?

The answer is to follow a structured process designed to transform performance and health in an integrated manner, which we describe in terms of five basic questions that need to be answered in order to make change happen.

If people see goals as beyond reach, they will become disillusioned and give up. But most organizations, whether strugglers or top performers, have more headroom than they think before goals truly do become unattainable.

Measuring health is one thing, but what is the right health aspiration for your organization? How should you determine which practices your organization should drive to distinction?

For most leaders, once they’ve set their performance and health goals, it’s tempting to move straight into action. In our experience, this is seldom wise, and often counterproductive.

Assessing the capability platform of your organization takes place in a two-step process: determining the capabilities that matter most in terms of your performance aspirations, and then evaluating the state of these capabilities in your organization today.

To determine the capabilities that matter, ask what capabilities does your organization need to fulfill its performance aspirations?

Having decided which capabilities are strategically important for achieving your aspiration, you can then undertake a structured inquiry into the current state of these capabilities in your organization.

Shifting mindsets is a gradual process. But the question is: how do you choose the shifts that matter most?