Peter Cochrane's Blog: Metrics overload

Written in Washington DC National Airport and despatched via a public wi-fi service in partnership with my UK ISP

Over the past few years I have been working in companies and other organisations including those in the health and education sectors where the introduction of performance metrics has had a profoundly negative effect.

In every case there has been a liberal application of simplistic thinking that has resulted in a vastly reduced overall performance with a combined increase in operational costs. How come? Very often those to blame are in political office and under pressure to show the electorate they are earning their elected position.

For sure, if you are to manage anything effectively you need measures, and if you are to improve performance you need metrics. But the first question to ask is: does it actually need managing and is there any space for improvement?

It is unfortunately a truism that most managers don't see that they are often in the way, can add no value and should just get out of the way. An awful lot of processes and activities just don't need managing in the first place. For those that do, they require a liberal application of intelligence and understanding. If you give people targets, they will achieve them; if you demand a change in performance from managers, they will show you one. In the first instance they will try and do your bidding but in the second they will resort to embellishing the truth, polishing the numbers and plain fiddling.

In the worst areas infected by the (modern) metrics disease we see irrelevant or conflicting requirements and targets, and more managers of metrics than those actually trying to achieve them.

The real killer? People stop becoming effective and turn the metrics game into a full-time career. In many countries we have police, medics and educators spending more time reporting than doing! So the supervisory overhead is very often the dominating portion of the overall spend and budget. This is a surefire route to failure in any system. Admin really ought to be less than 10 per cent and not 80 per cent of the budget.

So what is the solution - beyond good management that is? Once a set of sensible and minimal performance targets and metrics have been decided and agreed, automation is the only route to success. Just because something can be measured and recorded doesn't mean it should be!

In the worst case people will always resort to telling lies, gilding the truth and interpreting results in their favour. So most of the information created by such human systems is a travesty, waste of time, detrimental distraction and expensive hobby! In contrast, our machines will only tell it the way it is, provided the entry of data is also fully automatic.

All of this begs the question: why isn't modern management and politics up to the job? Simple! They are operating in some 18th century regime of quill pen and parchment thinking. Until we see the application of game theory, war gaming and situation modelling, combined with automated data recording, gathering and analysis, we will continue to see the waste and disruption continue to accumulate.

We have the technology but it seems we don't yet have the wisdom.