Death by numbers
They say that what gets measured gets managed. It is undeniably true that results you measure, count, or simply notice tend to improve. The cliché is only true, though, if anyone actually does take the time to notice that the measurement exists.
There’s plenty of pressure on organisations to measure more. The experts come in and point out that they’re measuring outputs but not outcomes, or that they’re measuring results but not the contributory upstream steps, or that they’re measuring money thousands of different ways but not the other dimensions of business performance. Whatever you are failing to measure, the usual fix is to measure more.
Do you have 387 Key Performance Indicators? What does key mean? Which of the 387 are really key? How thick is the bundle of paper you are given to review each month? How often do you assume that someone else has read the boring bits carefully for you? How do you know where to put your attention?
Pick those few measures that tell you the important story of how well things are working. Present them in a shape that speaks for itself, for example showing where you’ve been and where you’re going, as well as where you are, flagging the comfort zone and the danger zone. Use targets (health warning: see below) to stretch your comfort zone and bring the things you need to achieve in the future within reach. Aim to stop measuring more than you add. Of course make sure that the measures you pick give you the rounded picture that you need. By all means display them in a balanced scorecard if you want, or in a dashboard, or on a piece of paper – whatever fits your particular shape and style. Put them where you can see them. And then read them, understand them, get to know instinctively the implications of what they tell you – and do something about it.
Flaunt your stretch marks
We’ve got a big problem with targets. They’ve become all muddled up. We use one word to describe different things, and lose sight of the differences. Never mind confusing apples and oranges, we’ve got old boots in the mix too.
I’m particularly concerned about two distinct meanings:
Targets: externally imposed standards of performance. Pass/fail. Failure to meet them brings sanctions – metaphorical knee-capping, withdrawal of funding, withdrawal of your licence to operate.
Targets: internally developed challenges, used to create ambition in an organisation, to stretch the organisation’s capabilities. If you succeed in meeting them all, they were set too low, they didn’t stretch you enough.
It’s easy to get these two mixed up, but it’s very dangerous to do. Treating external targets like internal ones causes us to sail too close to the wind. We don’t build a safety margin into our performance, which leads us to panic and desperate measures. Treating internal targets like external ones causes us to build sanctions into our operations where they don’t belong, or to make things too easy for ourselves, to lose ambition.
It’s time to make a clear separation between the two. Labelling them clearly will make it much easier to behave appropriately towards each one. I tried for a long time to persuade people to think of something else to call the externally imposed numbers, but it wasn’t to be. So it’s time to make the change where we can, inside the organisation. Banish internal targets. Instead, flaunt your stretch marks!
In the loop
Feedback loops are what we’re talking about here. How do you know that what you’re doing is delivering the goods? How do you become acutely aware without getting swamped? (more…)