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Rethinking Performance Measurement

Rethinking Performance Measurement

We’d all like to believe “That which is measured gets done,” but it’s not always true. Many organizations that pride themselves on their people development limit their measures to traditional financial performance and broken employee evaluations procedures. And in spite of lots of “measurement,” nothing gets done.

There’s no shortage of business and HR metrics. If you want sales, revenue, or cost data of any kind, the accounting team will be happy to compile it for you. If the company actually uses and gets compliance in its employee appraisal process, HR will have drawers full of old evaluation forms. Lots of information can be measured, compiled, reported, analyzed, and considered - at the cost of significant organizational resources. But data doesn’t change behaviors.

I used to work with a company that believed in the idea of performance measurement, but didn’t get it right. It did have employee evaluations twice a year. However, the system was not automated, required lots of manual labor and nagging for completion of forms, and then required some sense of calibration across layers of evaluators and development leaders so that individual scores aspired to have some consistency. In the end, managers were able to have somewhat meaningful conversations with the individual employees, but there was a clear sense from folks on the ground that the process was ineffective. And the result was lots of cultural attention to doing appropriate politicking and getting good grades as opposed to a commitment to true team and cultural improvement. This, combined with a much more prevalent attention to the “business” numbers, made for a hard driving culture with questionable people development.

Some organizations try to innovate and use variations of basic business “results measures” including team financial performance, hours worked, outputs, cycle times, customer satisfaction on team outputs, etc. However, results alone will not necessarily drive cultural change. They might even drive bad behaviors and employee frustration/anxiety in an “ends justify the means” mindset. In any case, any kind of results measure that is centrally monitored and prodded usually just fosters “performance pressure” with goals that are imposed upon or disconnected from the people doing the work.

If we really want to get things done, we need to find a new way to consider what exactly we are measuring. Organizations in every industry have sometimes taken the most generic and simplistic interpretation of performance measurement, and true change has only been incremental. If we want to see a different kind or performance, we need to calibrate our measures in a whole new way. Before we set out on measuring the easiest things to measure, let’s be clear about what we want to get done, and do it.

Stay tuned for Mike’s next blog post which will address how companies can drive performance through implicit vs. explicit accountability.


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