Management’s Pre-Occupation with Measures . . . the Wrong Ones
- August 30th, 2010
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Walk into any business and you can get measures. What measures are being kept is of greater importance. Typically measures are associated with financials and/or activity . . . and this is where the trouble begins.
Measures of the activity and financial type are inextricably tied to profit and efficiency or so they believe. This is an assumption that drives dysfunctional behavior as there is a relationship between assumptions and waste. Whole organizations tie their fortunes to known, but wrong, business practices. They stand to win if everyone else is making the same mistake and they do the wrong thing, righter.
Activity and financial measures can be defined as lagging measures or results-measures. They tell us how an organization did after the fact. I sometimes like to call them “forensic measures” as those organizations that use these measures are already half-dead (Zombie measures may have been a better analogy).
Managing by lagging measures (financials and activity) may be useful to know the score, but tell us little about what to do. Add targets and incentives to the recipe and crazy things start to happen. Managers and workers focus their attention to achieving numbers that sub-optimize and create waste.
Lagging measures are doled out to each functional area as they are given their measure to hit. They may even be asked to be profit centers when their role is to support. When a supporting function is asked to be a profit center the value creating parts of the organization take a hit. Why? Because now functions compete for resources and are now have to arm-wrestle for resources.
If lagging measures aren’t the answer, what is? Leading measures, they help us understand what we need to focus our attention on and that is the customer. When customer measures that are derived from what matters to them are revealed, the lagging measures take care of themselves.
Why doesn’t everyone use leading measures related to purpose? Usually this is a condition of functional, top-down thinking that makes lagging measures invisible to executives. Or more simply put, they just don’t see the dysfunction when they are so far away from where the customer is. Only when they see it for themselves do they believe and even then some try to rationalize it away.
Many want to have a prescription for what they should measure. I don’t have one except the measures should be related to purpose or help improve performance. You may read the post Test of a Good Measure. But the best way is to go to the work to get knowledge and derive measures from purpose.
All managment wants better performance and better measures. To get there requires a different approach and to through out the existing assumptions about what makes a good measure.
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Tripp Babbitt is a columist (Quality Digest and IQPC), speaker, and consultant to private and public service industry.
I was unable to comment on you Deming post at QD so I’m doing it here.
A couple of folk aphorisms describe the situation with getting people to “see”: You can lead a horse to water…; How many psychologists does it take to change a light bulb? Only one, but it has to WANT to change.
I’ll believe it when I see it. (Its actually I’ll see it when I believe it.)
George Lakoff and other cognitive scientists have discovered that we live by ‘narratives’ that are made up of ‘frames’ or ‘scripts’; frames are among the cognitive structures we think with. For example, when you read a murder mystery, there is a typical frame with various kinds of characters: the murderer, victim or victims, possible accomplices, suspects, a motive, a murder weapon, a detective, clues. And there is a scenario in which the murderer murders the victim and is later caught by the detective.
Narratives and frames are not just brain structures with intellectual content, but rather with integrated intellectual-emotional content.
We live our narratives. Typical roles played in narratives include Hero, Victim, and Helper. A doctor may not just be a doctor, but a Hero-doctor, saving people’s lives. A president may see himself as a Hero leading a Battle of Good Against Evil.
We are not born with them, but we start growing them soon, and as we acquire the narratives our synapses change and become fixed; narratives are fixed in the neural circuits of our brains and they can be activated and function unconsciously–automatically, without conscious control. So we see ourselves as having only the choices defined by our brain’s frames and cultural narratives. And we live out narrative choices made for us my our brains without our conscious awareness.
It might be interesting to keep track of the people who are willing to pay for “lessons” to see how they came around, what their story is, with the purpose of seeing if there is a common set of circumstances that these people go thru to accept ST. Then it might be possible to create circumstances that improve the likelyhood of people investigating ST.
Can you give examples of leading measures? I see and hear this argument quite a bit with lots of examples of the bad (forensic measures) but usually never any examples of what should be used.
SMartin-
It looks like you may have only read the first half of the article as I lay out some of the groundwork for the right measures. There is a framework to follow, no prescription as each system is different.