What gets measured, gets managed

“What gets measured, gets managed.”

Peter Drucker said that, and with good reason. Far too many business decisions hinge on what’s “good for us,” “core to our mission,” “innovative” or any one of a rainbow of other buzzwords.

This is regrettable, because the only thing that matters in business – the only thing that should matter – is results. And the only worthwhile measure of results is numbers.

If this seems heretical to you, please remember that this site is called “Web Heresies,” not “Web Platitudes.” Our goal is to slaughter sacred cows and serve them up to you. Thus, it’s essential to understand that metrics are really all that matter in business, and that even faulty metrics are better than no metrics at all. That’s how important they are.

Consider what happens in the absence of metrics: politics rushes in to fill the void.

Business requires transparency, predictability and stability to achieve results, which is why politics in business is like cancer: it distorts and weakens everything it touches. It erodes transparency, predictability and stability by rewarding the ability to game systems and manipulate hierarchies. Advancement and reward are decoupled from the ability to meet objective criteria, and are attached to how well you can play the game.

This makes it impossible for most workers to predict whether they will be rewarded for doing a good job, or even whether the ability to do a good job exists.

Where people can’t predict the outcome of their efforts with reasonable certainty (such as whether they’re going to be rewarded or punished) uncertainty blossoms. In uncertain environments, chaos creeps in. Group cohesion crumbles, and employees rely on gamesmanship, favoritism, nepotism and other approaches to achieve some degree of certainty or stability. Everyone starts watching their back. This leads to a decline in morale, productivity and forward momentum.

Enter metrics. They’re objective, impersonal and empirical. They give employees the ability to control their destiny in some way which is understandable, transparent, and at least somewhat predictable. This gives people some sense of control over their destiny, and that empowers them to move forward.

However, metrics can also become a straightjacket. It’s difficult to come up with the right ones, attach realistic numerical goals to them, and modify those metrics and goals when their underlying conditions and assumptions change. This leads to criticism of their validity even before they’ve been defined. How does it serve the business to tie itself to arbitrary measures? Why do this when the business climate changes on a weekly basis? Why not identify our top-level goals and work towards those without dreaming up some superficial numbers management says we have to hit?

The reason is politics. Without those metrics – even flawed metrics – politics creeps into the equation. Metrics are proof against that. Even if they’re only half valid, they will help an organization avoid the kind of decay and lack of direction that politics brings.

To put it simply, let’s use an old slogan from seafaring: when you’re in the middle of an ocean, any wind is better than no wind at all.

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