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Avoid the Dark Side of Measurement

 

Assuming your organization has business measures in place, how does it use business performance results? What is the reaction when actual performance is below target – I mean seriously below target? Does everyone run for cover, hoping to avoid pointing fingers and executive tirades? If you answered yes, then you and your organization are experiencing the dark side of measurement.

On the dark side of measurement, performance results, particularly when they are below expectations, are used for punishment purposes. Poor results prompt explosions of management frustration and anger that are taken out on the people with “responsibility” for the measure or the result itself. The target of the anger is humiliated as he/she struggles to defend their position while others are just thankful that they weren’t in the line of fire – this time. The spoken message from management is: “These results aren’t good enough – we don’t care how you do it but just fix it!” The unspoken message is: “Poor results could become your problem. If you want to avoid humiliation, do what ever you can to hide poor results from the top.”

 

You would hope that, in the day of enlightened executive management, this type of scenario wouldn’t really exist. While this might be an extreme example, I can assure you that, sadly, versions of this approach to measurement results management do exist out there. 

 

The problem with the dark side of measurement is that it creates an environment that effectively shuts down a culture of “telling the truth” about how business is really going. In these organizations, people go to great lengths to hide business problems and keep themselves off the executive radar. A great deal of effort goes into trying to fudge the results rather than into doing what needs to be done to really turn problems around.

 

The real benefit of business performance measurement is achieved when it is used for learning, opportunity identification, and action. Successful organizations embrace the ugly in their business. While they don’t love the ugly stuff, they respect it because they know that, when approached right, it offers an opportunity to learn more about the business.

 

In these organizations, people aren’t afraid to talk plainly and openly about what is going right and wrong in their business. While leaders aren’t happy when results are below expectations, they understand that it isn’t the worst thing that could happen. As a result, rather than get angry, they encourage in depth discussion about poor results including the underlying root cause problems. Employee effort goes into wrapping their hands around the top root cause problems and eliminating them permanently through targeted action plans that may be built on successes achieved elsewhere in the company.

 

In these organizations, poor performance results aren’t viewed as problems – they are seen as opportunities for improvement. Concern does arise when people don’t know how what is driving under performance (i.e. the root cause problems), when the organization fails to follow through on planned corrective actions, or when lessons learned are not leveraged to prevent or eliminate issues that result in poor business performance results. And, rather than get emotional, company leaders model the desired behavior by coaching their people to close these knowledge and action gaps when they exist.

 

Can you see the difference between the dark and light side of measurement? The dark side is all about hiding from business truths while coming over to light involves shining a light on every nook and cranny of your business and embracing the truth, no matter how bad it is.

 

The result is a healthier work culture, happier employees, more efficient business operations, and paradoxically, better business performance results!

2 Comments

  1. Eric Patki
    Aug 8, 2010

    Super! Great thoughts! I was going through all of your recent blogs and really admire the way you simplify often confused but very important terms/processes on Strategy / Strategic Management through these brief blogs. I too believe that measurement / reviews of strategy execution can be fact-based rather than pitched with emotions (humiliation of poor performers) thereby infusing sportsmanship in the process. Culture and leadership are mostly responsible for manifestation of dark side. In my opinion, frequency of such manifestation of dark side is important. Sometimes it is just human to get frustrated to see goals are not met, however if it is often, it could render serious disadvantages to the organization resulting in organization losing its competitiveness.

  2. Sandy Richardson
    Aug 8, 2010

    Hi Eric:
    thank you for your positive feedback on my blog posts! Strategy and strategy management can be challeneging topics to make sense of and one of my goals is to try to bring it down to the key elements and work to have a meaningful conversation on them.
    I agree with your observation about culture and leadership as being a prime drivers of the dark side problem. When I work with clients, one of the key success factors is to create a different kind of environment within the organization – one that provides a safe place to discuss the truth of business performance and results.
    If you have any topics you would like to see me write about in the future, please let me know!
    Sandy