“You can’t manage what you can’t measure” is a maxim fused deeply into the modern organizational DNA. From annual budgets to individual SMART goals or OKRs, measurement has played a pivotal role in key organizational interactions such as building shared alignment, informing continuous improvement efforts, and ensuring accountability.
And yet, in addition to its great merits, measurement is not without perils. Especially when taking into account what we often try to measure, a complex reality, and who’s doing the measurement and taking action on it, fallible human beings.
Many of the most important aspects of our reality are continuous rather than discrete. When we try to quantify them through measurement they lose some of their essence. Their quantifiable representation is not an accurate depiction of them and important attributes and nuances can get lost in the translation. “The map is not the territory” as another famous maxim posits.
In other times, the thing we want to measure proves to be so intangible or difficult to measure that we opt to measure something else as a proxy. And then we forget that a proxy is just a proxy and only captures a portion of the essence of the thing that we’re actually interested in measuring.
The value we generate for our customers is a good example of such an intangible attribute. Back in the days when Sears was not just a department store, but also ran a chain of auto service centers, the centers’ leadership team decided to use revenue per employee-hour as a proxy for the throughput of value it generated for its customers and challenged employees to improve it. The result could not have been farther from the intent. The metric improved but through company-wide overcharging for work and completing unnecessary repairs. Behaviors and outcomes that no customer would ever consider as “valuable”.
Our humanity can also get in the way of effectively using measurement. We have an inherent tendency to favor the measurable over the unmeasurable, the tangible over the intangible, regardless of their relative importance. The “tunnel vision” that the measurable often creates was described most bluntly in the famous Deming quote:
“If you give a manager a numerical target, he’ll make it even if he has to destroy the company in the process.”
When Ford set out to build the Ford Pinto, its response to the small, fuel-efficient foreign cars that were eating its US market share in the 1960s, “under 2000 pounds, and under $2000” was used as a way to describe a quantifiable end result, as both vehicle weight and cost-of-production were fairly straight forward to measure. With such a defined goal, the less tangible ideal of safety was easier to neglect and important safety checks were not performed. A critical design flaw meant that the Pinto could combust on impact, resulting in the death of multiple individuals, costing the company more than $128 million dollars ($500 million in today’s dollars) in legal damages, and a significant reputation hit.
“Not everything that counts can be counted, and not everything that can be counted counts,” as Bruce Cameron eloquently observed. Even Drucker, who I knowingly misquoted at the top of this article gave the following advice to a client CEO:
“Your first role . . . is the personal one, it is the relationship with people, the development of mutual confidence, the identification of people, the creation of a community. This is something only you can do… It cannot be measured or easily defined. But it is not only a key function. It is one only you can perform.”
And yet we seem to try to measure everything anyways.
To be clear, the elimination of measurement will be just as counter-productive. A measurementless organization runs a high risk of simply switching from one tyranny to another: from the tyranny of the measurable to one closely resembling Joreen’s Tyranny of the Structurelessness:
“The idea becomes a smokescreen for the strong or the lucky to establish unquestioned hegemony over others. This hegemony can be so easily established because the idea of “structurelessness” does not prevent the formation of informal structures, only formal ones”.
Similarly, without an agreed-upon direction or desired end state, either chaos or coercion are likely to be the driving force.
Aristotle captures this delicate balance in an age-old observation:
“[virtue] is a mean between two vices, that which depends on excess and that which depends on defect; and again it is a mean because the vices respectively fall short of or exceed what is right in both passions and actions, while virtue both finds and chooses that which is intermediate.”
A key reason for the overuse of measurement as an organizational practice, even in situations where its shortcomings exceed its benefits, is our limited “organizational toolbelt”. If the only alternative to quantitative measurement seems to be letting structurelessness and intangibility reign free, Maslow’s “law of the instrument” will be in full effect: “I suppose it is tempting, if the only tool you have is a hammer, to treat everything as if it were a nail.”
Three alternatives to business-as-usual measurement
Therefore, I’d like to introduce a few alternatives to quantitative measurement in an effort to expand the toolbelt looking for a better fit between a tool and the situation at hand.
Often measurement is used as a way to describe a direction or a goal. But guiding the decisions that will help to reach that goal can be a powerful alternative. Decisions are often trade-offs between two things that matter, so articulating the key tension and providing a rule of thumb for which should be favored can be a viable alternative to simply quantifying a goal.
When Brian Robertson set out to articulate HolacracyOne’s growth strategy for its next phase as a business he noticed the following:
“For the first few years of our growth, every event or training we did was unique and special, co-created on the fly with various partners who offered to host us and help market. This helped us to explore the new landscapes we were moving into, and it generated a lot of movement and some important relationships. But soon, our penchant for creating new and exciting offerings became unsustainable for that particular phase in our growth. It’s expensive when every new offering is a custom product and each partnership requires hammering out a unique deal.”
He decided to capture this tension and shift in direction by articulating the company’s new growth strategy as an even-over statement: “documenting and aligning to standards, even over developing and co-creating novelty”. With this even-over statement articulated everyone at the company now had a powerful decision-making lens that provided guidance without micromanaging.
Many of the messier organizational aspects that don’t lend themselves well to direct quantitative measurement tend to require a more nuanced balancing of an inherent trade-off, like “How do we balance our short-term survival with long-term success?” rather than simple either-or problems that need to be solved, like “Should we build our next office in Seattle or Portland?” where a decision in favor of one outcome automatically eliminates the other. Those trade-offs, also known as polarities, can be managed using polarity maps.
Once a critical polarity has been identified, either organically or using a list of common critical polarities such as Quinn’s organizational polarities list, a polarity map can be constructed using the following steps:
- Creating a basic map: Capture both the benefits and unintended consequences of each “pole”.
- Orienting: Ask yourself, “What is our current position on the spectrum between the two? In which direction do we want to move? What does the “sweet spot” look and feel like?”
- Moving: Ask yourself, “What are the action steps that’ll move us in the desired direction? What are the early warning signs that we’ve gone too far?”
A polarity map for the “short-term” vs. “long-term” polarity mentioned above might look like this:
Measurement can optionally be used in the last step of articulating action steps and early warnings, but the complete map helps ensure that the broader context is maintained
In some cases, we use measurement to choose a direction to head in from several options.
For example, if we subscribe to Gallup’s 12 drivers of employee engagement, knowing that we can’t move the needle on all 12 at the same time, we want to figure out which ones to focus on next. A typical approach will have employees score each driver individually using a Likert scale.
However, this approach greatly increases the risk of falsely analyzing the numerical data. Given our original intent of choosing a path from multiple options, the most valuable insight comes from the relationship between the scores for the drivers. The absolute scores themselves are fairly immaterial. It’s the difference between them, informing the ordering of the drivers, from most important to focus on, to least important to focus on, that actually matters. A simple alternative, then, is doing exactly that from the get-go: having people order them instead of scoring them individually. With this method we avoid the temptation of running analyses on numbers that don’t actually matter and instead get straight to what does, figuring out the relative importance among a group of options.
While measurement is an essential tool in every organizational toolbelt, the risk of overusing it and misapplying it is real. And as the examples at the beginning of this section suggest, it can result in grave consequences. The three additional tools introduced in this piece, even-over statements, polarity maps, and ordering can be viable alternatives to provide clarity and direction where the risks of conventional measurement are highest.
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