Tuesday, September 28, 2010

Ranting Again About the Unintended Results of Poorly Chosen Metrics:

Do companies take the time to think about the implications both positive and negative of metrics that are put in place? I am beginning to think not. I have noticed with more and more concern the bad behavior that one particular metric is driving. Many companies now use it and in almost all cases it is limiting the overall results of the business.
The metric is head count and while at first glance it looks like a good way to measure workforce productivity the problem comes in when it is used in a vacuum.
I will give you a very common example: Many sites are eliminating Administrative Assistance and Clerks to reduce head count. Because of this reduction Supervisors, Engineers, and Managers as well as others are now handling many of their prior tasks. This leads to supervisors who are chained to the desk handling administrative task. These supervisors are very well paid individuals that should be out with their direct reports enabling the larger group’s success. If they are constantly in the office behind the desk, do you think that we are getting the maximum value from the team as a whole? An Administrative Assistant can be hired at half the cost of a supervisor or manager freeing up time so that they can be on the floor working with the team enabling an increase in productivity that pays for the Assistance’s time multiple times over.
In the end, before implementing new metrics take the time to do a simple risk review. Look at both the positive and negative implications of each metric and the likelihood that the metric will drive a bad behavior. Pair metrics together to limit the down side risk as this will provide checks and balances. Metrics are very powerful in making change in an organization, we just need to insure it is the right change.