Measuring processes not people
Deming has often been quoted as suggesting that “The System” accounts for 90% to 95% of performance. This is one of the reasons he railed against performance appraisal systems, incentivisation and such like. Working on the 5% rather than the 95% was both costly and counterproductive in his eyes.
In ActiveOps we use a similar idea when we say that Performance is a function of Willingness, Ability and Opportunity. Only by giving people the opportunity to perform will you get the most out of their willingness and ability.
What has this got to do with data? Well, imagine a senior manager seeing a report showing a recent fall in productivity in a team. Their inclination might be urge the Team Leader to get a bit more assertive and challenge the team a bit. Or the manager might think it time to remind people that their bonus is on the line if performance doesn’t improve. But what if the reality is that two members of the team were in work because a training course was unexpectedly cancelled?
Perhaps with 20% more resource available in the team, and no more work to be done the real reason productivity fell was because work was being distributed around more people. Not willingness, not ability – but opportunity.
What needs to be measured under these circumstances is the capacity management process – not the individual or team productivity. How good was this operation at balancing demand and capacity? How responsive was it to changes in work load or in resource available?
In our experience, improving the capacity management process can deliver anything upwards of 20% performance improvement. Forced rankings of individual performance, identifying who to “let go” and who to reward will achieve nothing like this. And yet data on individual performance is often offered up as the key to performance improvement.
When data is used in this way – to support “collective time management” if you like, clean and accurate data will help a team leader to co-ordinate the efforts of the team to deliver the best outcome to the customer, and the best cost to the operation and with minimal stress on the team. In this way teams will be invested in the data being accurate, rather than in just trying to look good.
So we could probably summarise our opinion on data with the old adage: “It’s not what you’ve got that matters, it is how you use it”. But let’s give the last word to W. Edwards Deming when he made the point about using data to set targets and measure people against those targets.
“People with targets and jobs dependent on them will probably meet their targets – even if they have to destroy the enterprise to do it.”
There really is a better way.
Neil Bentley has been helping organizations to improve their front-line operating performance for over 20 years. Originally qualified in Psychology, he went on to work at Lucas Industries in the 1980s, gaining experience in manufacturing production management, before focusing on financial services and the public sector, first with PA Consulting Group and then as a partner with specialist consultants OCP.
He launched ActiveOps with fellow OCP partner Richard Jeffery in 2005. Neil brings with him an unparalleled understanding of the mix of the human and the technical aspects of performance improvement.