Current events have me thinking again about how leaders of organisations so often fear losing control – or fear that they’re not in control in the first place. This week’s article focuses on one way that they respond to this lack of control – by imposing measurements and setting targets – and the way that this can come back to bite them.
This week’s article
Targets and goals seem to afford leaders control, but can have the opposite effect
People at the top of organisations, despite their confident appearances, often feel out of control. That’s because human organisations are messy and complex, and defy straightforward authority. It’s not that their leaders merely feel out of control; it’s that they actually are.
This lack of control is compounded by the way that senior people move between jobs. Inevitably, they move from a senior role in one organisation to a senior role in another. In doing so, they miss out on acquiring contextual information specific to their new place; they’re required to hit the ground running, and don’t have the benefit of observation over many years at a more junior level. This is particularly true in our managerialist era, which venerates the MBA and considers “management” to be an abstract discipline – often hiring CEOs to run businesses in industries completely different to their past experience.
One of the most common responses to this lack of context and control is to hunt for measurements: simple, objective, quantifiable numbers that reveal how the organisation is doing. With the right metrics found, targets can be imposed, incentives will be aligned, and the organisation will move naturally towards the leadership’s goals for it. But it’s all a fiction. These targets only offer the illusion of control; they’re a false comfort.
The problem is that measurements tend to have a distorting effect on organisations. Jerry Z. Muller, in his excellent book The Tyranny of Metrics, identifies two such negative effects: goal corruption and goal diversion.
Goal corruption is the situation in which people comply with the numeric aspects of a goal while neglecting its spirit. For example, a school that is being measured on the percentage of students that pass their exams could respond to that target by improving its students’ performance on the exams; presumably this would be in line with the intent of the goal. But it could also achieve the target by asking its weakest students to stay home on exam day, which most certainly wouldn’t be the intention of the goal. The goal has been corrupted.
Goal diversion is the situation in which people focus on what’s being measured, at the expense of other things. So a salesperson incentivised to hit a sales goal might neglect the quality of the leads they’re bringing into their organisation; they might hit their targets, but at the expense of harming the quality of the business’s work and its reputation. In the most extreme cases, they might forego their own judgement altogether; Jeffrey S. Nielsen, in The Myth of Leadership, explains how leaders can often create vacuums of initiative, as people look constantly to those at the top for guidance on what to do. Focusing on metrics only makes this problem worse.
What’s the solution, then? It’s too simplistic – and wrong besides – to say “don’t measure anything”. There is such thing as a useful metric. But how on earth do you define such a thing?
The main thing to remember is that not every problem can be neatly solved. Conditions of success aren’t always easy to define in advance, or even sometimes in hindsight. Just because you can measure something, that doesn’t mean you can improve it.
John Kay’s advice in Obliquity is sound. He advises us to get comfortable with the idea that we can only have limited information, and that we can never know all of the possible options that are open to us. Instead, he suggests that we learn to rely on many different models and narratives, of many different sorts: some qualitative and some quantitative, and all from different parts of the organisation. Muller agrees; he reminds us that systems that measure performance only work when the people being measured believe in the systems’ worth, and counsels us to look for bottom-up measurements rather than to impose them from the top down. The result will look less like a simple and straightforward dashboard of KPIs – but it will reflect reality a whole lot better, and distort it a whole lot less.
This week’s four interesting links
Wesley Morris celebrates a type of art that America used to specialise in, but has stopped making: trash.
“I was 11 when Nuts came out, and it helped lead me into a committed relationship with a certain category of movie. The people in them seemed loonier, lustier, louder than we’re supposed to be. Their eyes were wild; their makeup ran. They had hair we were meant to know was a wig, because it was impossible hair. The paint chips for these movies might read: ‘wanton,’ ‘lust,’ ‘paramedic,’ ‘weak bladder,’ ‘mattress,’ ‘steamy,’ ‘do not cross,’ ‘pilot light,’ ‘them drawls,’ ‘brazen,’ ‘lit cig,’ ‘urinal cake,’ ‘Crisco,’ ‘bust.’ In being honest about this volatile, unkempt, uncouth, indecorous, obnoxious, senseless, malicious, unhinged and therefore utterly uninhibited side of ourselves, a certain kind of movie can make an X-ray of what else it is besides a story about some characters. It can identify the mess.”
Geoff Dyer, writing in Aperture, summarises the iconoclasm and revolution of photography in the 1970, an era I’ve always found fascinating.
“Photographers were busy taking photographs, making work, but interesting photographs are always being taken, great work is always being made, whatever the decade. In the ’70s, though, photography was being examined and defined in a way that harked back to Alfred Stieglitz’s pioneering inquiries into… ‘idea photography’.”
Beautiful paper-cut artworks by artists Julia Ibbini and Stéphane Noyer that recall the geometry of Islamic art and architecture and are made possible by computer-controlled laser cutters:
John Lanchester at his best, comparing the current government to live-action role-players:
“Until Liz Truss, no one had ever thought to try Larping as a system of government. But it turns out that we in the UK are living inside a full-scale Thatcher Larp, whether we voted for it or not. (For the avoidance of doubt: we didn’t. Check the 2019 Conservative manifesto for proof.) This unhappy discovery was something the country, and the financial markets, learned from Kwasi Kwarteng’s ‘mini-budget’ on 23 September, the latest catastrophic f***-up inflicted on the UK by an over-confident Etonian.”
This, Lanchester argues, is why the markets had such a catastrophic response to the mini-budget – because it made it unavoidably, unignorably clear that the government was fundamentally unserious:
“The uncosted new policy became, to markets, a signal that the new government is not serious and doesn’t know what it’s doing. Truss can wear as many pussy-bow blouses and sit on as many tanks as she wants, but while her policies continue to be uncosted, it’s Larp Thatcher, not the real thing. Markets don’t want a G7 economy to be led by people playing ‘let’s pretend’.”