There's a column with that title in the current issue of Business 2.0 magazine, the Nov 2006 issue.
I'm re-posting this because the article is now online.
The piece is about measuring the productivity of office or white collar professional workers. It begins with a pretty nauseating premise:
“It's one of the most basic questions in management: How do you know how effective you are at squeezing labor out of office workers?”
If you think it's your job to “squeeze labor” out of workers, professional or otherwise, I think you've already lost the battle as a manager.
The author's premise is correct, in a way — it's hard to measure the productivity of professionals because it's complicated. My view would be that it's hard to accurately gauge an individual's contribution to the inputs –> process –> outputs equation. I think that's part of the reason Deming was so against performance reviews — knowing how one individual contributed to a complex system might be an “unknowable” measure, something impossible to accurately measure in a quantitative and “objective” way.
The author continues:
“… nor can you simply count the widgets [professional workers] ship per week, as factory managers do.”
Again, the author is oversimplifying the role of a factory manager. It' s not that easy to manage a factory and you certain need to measure more than raw output (not to mention, you can't be making more widgets than your customers require, yet another “complication” of lean thinking).
From the noxious beginning, the author actually makes some good points, including:
“Experts are starting to believe bad measure is worse than no measurement. Take law firms that only count billable hours — cause there associates to stay in the office so much that eventually they burn out.”
I think part of the problem with our metrics is that we confuse what's EASY to measure with what's IMPORTANT. The number of billable hours worked is easy to measure. The quality of a lawyer's work (or a consultant's work, such as my own) is tougher to measure. Customer/client satisfaction is either hard to measure or it's somewhat subjective, or both.
Joanne Sujanksy, CEO of a firm called KeyGroup, is quoted with some tips for effectively measuring employee effectiveness. The six points with my brief synopsis/commentary:
- Ask your employees
- Respect your employees and ask them how they should be measured, to get meaningful metrics, as well as buy-in and a sense of ownership.
- You need a balanced scorecard, considering quality and other measures. If focus only on output, that's exactly what you'll get.
- My warning: don't confuse a numeric score for an employee (1-5 or 1-10) to be “objective” just because it has a number attached. Make sure objective measures, such as “lines of code written” are balanced with quality metrics.
- Subjective can be dangerous if not done carefully and fairly, but Sujansky has a good idea to update employees monthly (not just an annual review, as Deming warned about) — it's fair to give employees feedback as continuously as you can so they're not surprised with a bad score at the end of the year. Sujansky also suggests letting employees rank themselves in some area, which seems like a good idea.
- Don't create too much waste/muda in the name of collecting metrics
- Here's the most important point from a lean and systems thinking perspective. If employees are expected to work as a TEAM, you need to have TEAM metrics, otherwise you'll encourage competition and dysfunctions that come along with that.
What are your thoughts? It's getting to be the end of the year. Who's thinking about doing annual reviews or being graded on their own annual reviews???
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