Archive for April 2011

The Duel of the Physicists

April 11th, 2011 — 3:21pm

Peruse any forum on business and sooner or later, you will find a discussion on the value of metric-based performance appraisals. Almost inevitably, you will also find a reference, attributed or not, to Lord Kelvin’s famous dictum, “If you can not measure it, you can not improve it.” (Here’s one example: Metrics, metrics, metrics. “If you don’t measure it, it won’t happen.”) Finally, you’ll also probably note that the discussion’s initiator heavily favors measuring. In my example, the next lines read, “Do you believe that every department/function and employee should have measurable goals? Can you share your successes?” Quite possibly, because of this aphorism, Lord Kelvin is better known to managers than physicsts.

Now consider Albert Einstein. True, he wasn’t a “Lord”, but surely his various other achievements compensate for this deficiency? He said, “Everything that can be counted does not necessarily count; everything that counts cannot necessarily be counted.” As managers and students of management, if we must turn to physicists for insights, can we not cite him with equally often? We don’t and this is sad, for we need this particular insight very, very badly. Consider just two examples:

In a world in which most businesses rely on others for core products and services, as a manager you rely on work done by people you don’t know, who work for other companies with different goals, cultures, and risk tolerances. Here, you have two choices: You can base your hopes for a mutually beneficial relationship on tightly structured, measurable Service Level Agreements that your teams of lawyers can help enforce. Or, recognizing that if you have to rely on lawyers to enforce the relationship, you can’t possibly succeed at it, you could choose to invest in building a a level of mutual trust (which you could never measure) which would smooth the imperfections of your “good enough” SLA.

How about innovation? How many of the greatest products or services you use today (or those that were used in the past) were created in workplaces that operated under the philosophy, “If you don’t measure it, it won’t happen?” Some of the most innovative workplaces of the world have long given employees free “off the clock” time and free resources – and benefited from the results of the unmeasured, untracked tinkering they did.

One and even two generations ago, the doyen of quality, Edward Deming, tried to use statistics to convince managers that measuring the performance of individuals often made no sense. Most weren’t willing to consider this advice. Now they need to follow it more than they did then. (And no, Google’s recent efforts, to which I will devote a separate post soon, doesn’t obviate this opinion.)

Metrics and measures have a place in business, just not a central one. A manager who firmly ascribes to “If you don’t measure it, it won’t happen” will most likely make sure only one thing will definitely happen: he/she will be outperformed by those who understand that at the very least, not all statements about physics should be applied to management, and more correctly, management is most definitely not physics.

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