Showing posts with label data-centered culture. Show all posts
Showing posts with label data-centered culture. Show all posts

Thursday, 28 April 2011

A place for everything; and everything in its place

I’ve always wanted to be the sort of person who could honestly say things like “a place for everything – and everything in its place!” It is so organised, so logical and so likely that you could actually find things again. Even though our desire for order and organisation is strong, the tendency to be disorganised is ever present – at least with me.

One of my favourite quotes is from Gustave Flaubert – the French author of Madame Bovary. “Be regular and orderly in your life, so that you may be violent and original in your work.”

As the complexity of our work increases, so the need for order increases. As the complexity of the problems we wish to solve, so the need for organisation increases. As the number of people we involve in our endeavours, so the need for regular orderliness increases. When this order is missing, so unproductive thrashing increases.

I was talking to someone yesterday about an interesting (and far from straightforward) business problem. As we talked and I tried to understand their approach, it became clear that one issue was having information in different places. Whilst the system we were discussing was in constant use, other information was in other places and getting no attention. I wouldn’t go so far as to say the information was lost – but another few months, or years and it may well be lost. Or at least forgotten about so it will be of no use.

So it seems that both my grandfather and Flaubert were right. Whilst Flaubert is known for his scrupulous devotion to his art and style, he is also known as being one of our greatest ever novelists. He was certainly violent and original in his work - which is not bad for such a short life.

Friday, 18 February 2011

Are you Intelligent?

Which would you prefer? That people think of you as being intelligence, talented and bright? Or methodical, disciplined and thorough?

I’m guessing most of you think of yourself as intelligent. Like drivers, we all think we are in the 10% when it comes to driving ability. And none of us like to think we are stupid …

Yet intelligence is a curious quality. Intuitively know when we meet an intelligent person. We don’t need to ask them to do tests, or perform calculations. Somehow we can see intelligence in their eyes and hear it in what they say. However, we struggle to explain what we mean by intelligence. Like a fine wine or great art, we know it when we see it. (Of course, schools and universities test for a certain type of intelligence with examinations, but history has demonstrated that many intelligent and capable people have little aptitude for passing exams).

But what about the methodical, disciplined and thorough lot? The well-organised brigade who can always find things and have the right information to hand?

Even though the two are not mutually exclusive, and many intelligent people are also disciplined and methodical, it is not their organisational abilities that grab the headlines.

A visit to the war cabinet rooms in London this week made me think about the complex nature of intelligence, and what is required to outsmart the competition (whether in war or in business). Churchill’s brilliance (although he famously struggled with exams) and the military’s great organisational abilities, were clearly on show. Maps lined almost every wall covered with pins and wool showing enemy locations and manoeuvres. Graphs and carefully stencilled statistics were also pinned to the walls; not hidden away in ring binders.

Military Intelligence has come to mean information and data rather than thinking ability. When the stakes are as high as the independence of a nation, it’s interesting to reflect on whether it was the intelligent, talented and bright bunch who carried the day. Or the methodical, disciplined and thorough crew.

Friday, 28 January 2011

How Many Benchmarks in your Day?

Benchmarking might appear to be a pretty academic concept, yet it’s amazing how much we use it at work and at home.

Are you happy with what you are paid? Having a rough idea of the national average or how much people earn in our line of business makes a difference: so much of a difference that this benchmark affects how happy we are with our work.

What time do you set your alarm for in the morning? Knowing that you will function well on 8 hours sleep affects your attitude and demeanour the following day. A daily benchmark we use without even thinking about it.

How many hours a day do your colleagues work? Having a rough idea also affects how satisfied you are with the number of hours you have to put in to get your work done. Benchmarks are everywhere, even though they don’t have that label.

I was looking up how many telephone calls professional telesales people make a day. 100 calls a day gets bandied about on forums that discuss this sort of thing. 100 calls a day! Wow! That’s a huge number. Well it might seem that way to me, but to some it’s a normal day in the office, and they fit in other work besides.

Benchmarking is important because it gives us an idea of what’s possible, what’s exceptional, and what’s sub-optimal. When managing a business, that’s hugely important.

Being able to measure and benchmark people’s capabilities and achievements enables everyone to reach for their best. And that’s when people are at their happiest – when they are striving for something that’s worthwhile, difficult but achievable.

Benchmarking is also a way to solve problems. Once you can measure the current position, and compare that to some sort of benchmark, you can start to figure how big or small a problem you have. And even where you might look to start solving it.

So keep a look out for where you are, and are not, guided by benchmarks. Some of them might surprise you.

Friday, 1 October 2010

The Cloud’s Silver Lining

Cloud computing offers significant benefits to cash strapped businesses that need to Get Things Done. There are no high upfront costs of buying servers and software, rather you on pay as you go for what you need. The service is ready and waiting for your requirement, like a Labrador puppy – always eager for walkies.

But the silver lining doesn’t stop there.

Whilst cost and availability are pretty helpful (OK, more than just helpful in difficult economic times) one big benefit of cloud computing is its ability to join up geographically separate locations. If I want my Edinburgh office to see the same set of performance indicators as my Southampton office, I need a way for them both to be able to see the same data - and I need it to be secure. For smaller companies that don’t have their networks linked, this isn’t so easy.

Putting your application in the cloud takes care of all the communications issues in one monthly payment. No support costs. No need to hire someone to take care of the infrastructure. No necessity to deal with multiple suppliers: just a simple internet connection.

Whether a company is spread across town, across the country, or all over Europe – this is a big benefit. And the mechanics of designing the application are no different from any other business app.

So whilst cost is often trumpeted as the big benefit of cloud computing, I suggest there are others that are probably more important. After all, what price efficient communication?

Tuesday, 29 June 2010

What is a data warehouse? And do you need one?

The language of business intelligence can be confusing. Cubes, data warehouses, OLAP, and data mining are all terms that are not exactly self-explanatory. One of the most often used terms in business intelligence is the Data Warehouse, which conjures up images of vast spaces filled with digits. As if 5’s and 8’s all had their own bin in a super-efficient warehouse.

So what is a data warehouse, and how is it different from other databases?

Just about every company has at least one transactional database, and most have many. They store accounts data, contacts, stock or project data. Transactional databases are the ones we use to run our businesses:
  • Those that get updated on an hourly, daily or weekly basis
  • The systems (whether we recognise them as databases or not) that we could not do without.
But not every company has a data warehouse. They are often considered the domain of very large companies, even though that is not necessarily true.

A data warehouse holds historical information. It’s where the data goes after it’s been used in a transactional database system.

As an example, a hotel reservation system is used to let customers know whether there is availability for their preferred dates, and to produce an invoice for hotel services used during their stay. A data warehouse for the same hotel might hold this information summarised by day, month and season so as to better understand customer booking behaviour.

Transactional systems hold detailed information such as the alarm call time for the guest, whereas a data warehouse summarises several years’ data to get a more accurate picture of how promotions or seasonality affect bookings.

In addition, data warehouses can bring data together from several different transactional systems to gain new insights into a particular problem. In the hotel example, costing information might be added to find out which customers are most profitable.

So whether or not you need a data warehouse depends on what your business priorities are. Whether, for example, you want to:
  • Better understand customer behaviour
  • Understand which customer segments are most profitable
  • Send more appropriate marketing communications to your customers
There are many, many more uses for data warehouses, but understanding customers and profitability better is a good start if you haven’t started planning your data warehouse.

Wednesday, 23 June 2010

Why marketing is difficult to measure

Despite its central importance, marketing's value to the business can be difficult to quantify. There are 4 main reasons for this:
  1. Marketing is about perception. It's about positioning products and services within a space in people’s minds. This can only be measured over a period of time and in relation to alternatives. Damage done to a brand today may not translate into lost sales until the day after tomorrow.

  2. Marketing is multi-channel. People often purchase after exposure to a variety of different messages. All, some, or none may have contributed to the final decision; the advertiser does not (always) know. Hence the most often-repeated saying in marketing: ”half my advertising is wasted, but I don’t know which half”.

  3. Marketing is creative. It is populated by ideas-people, visual-thinkers and wordsmiths. Not by statisticians or accountants. Yet numbers are the language of business and some argue that marketing would have more influence if they were more willing to quantify.

  4. Marketing is part of the whole. The marketing led company has products and services designed with customers in mind, serviced by customer-care departments and created or provided by customer-focused people. When considering sales or profitability, it is impossible to split out the influence of the product, the after-sales service, the marketing, sales effort or the skills of Human Resources to find good people.
However, moving towards a data-driven culture in marketing has big benefits, not least of which is making decisions based on fact rather than guess-work. As innovative technologies become more powerful and more affordable for marketers, measures become more relevant. And excuses less so.

Thursday, 29 April 2010

Why marketing and running need good data

I joined a running club last night. Don’t laugh. I mean, it is funny because I’m not what you might call a runner. I was so useless that I got pulled off the track half way through the 4-lap exercise. Needless to say, I’m in the “slow group.”

Our coach is a wise and wiry 70+ running veteran called Tom. He ran the London Marathon last weekend and was still a little stiff from the exertion. I would have been in a wheelchair! But he was kind and quietly pointed out that he didn’t start out running marathons: he worked up to it over a period of time and I should expect to do the same.

He took his induction group through the basics: track safety, warming up and stretching afterwards - all carefully explained with good reasons for each task. Despite feeling like I didn’t belong amongst such talented runners, I was made welcome and reminded that perseverance pays.

Marketing is no different. Early attempts look clumsy compared to the professionals, but everyone has to start somewhere and the more we work at it, the easier it gets. In marketing, as in running, strength comes over a period of time and we learn from each mistake. At least it does with marketing, for now I'll have to take Tom's word for the running.

Building a solid business through marketing has another similarity to running – both need good data to keep motivated and moving forward. In marketing it is number of enquiries, new customers and profitability. In running it is distance, pace and time. Take away the data and both disciplines would struggle.

Tomorrow I’ll tell you why I’ve joined a running club, and what I think is most important with both marketing and running. Right now, I'm going to sit down because my feet are a little sore!

Thursday, 15 April 2010

Increase your chances of hitting targets

One of the central building blocks of Performance Management is target setting. The theory is that targets provide a focus and are therefore more motivating than working without a specific aim. But the reality is more complex. Sometimes, rightly or wrongly, we just don’t believe the target is achievable. Then all motivation vanishes.

So simply setting a target isn’t enough – we have to believe the target can be hit.


One way of doing that is to find out what results other people get in similar circumstances. For example, if you are sending out a direct marketing campaign, find out what typical response rates are for your industry. If you are starting an initiative to raise customer satisfaction levels in your company, find out what results your competitors get to such surveys. Sometimes the information is difficult to find, and sometimes it is surprisingly easy.

You can, for example, easily work out the sales turnover per head for other organisations. General knowledge, or information published by the company, might tell you how many salespeople they have. It’s not an exact science, but it gives a rule of thumb when figuring out realistic targets for salespeople.

So a target isn’t really a target unless it is grounded in evidence that it can be achieved. Once you know that someone else can hit or exceed a target, you then know that all you have to do it figure out how to do it for yourself. Because you, and your team, know it can be done. Then all that’s required is to unleash your creativity and energy to go and do it.

Tuesday, 13 April 2010

What do your customers need & want?

Knowing your customers’ needs, wants and preferences is vitally important in today’s world. Of course, it has always been important, it’s just that software now enables us to do so much more. Which of course means that if we don’t understand our customers’ needs and wants, someone else will make the effort to understand them.

Which kinda puts the pressure on to start figuring it out.

We all like to think we know our customers well. But the truth is there are some things about them we know very well, and other things we are blissfully unaware of. Yet most customers are more than happy to provide all the clues you need to understand them. After all – they buy from you – that’s a pretty strong clue as to what they need and want.

When you start to have a look at the data you have about your customers there is a surprising amount of it:
  • Who they are and where they are located
  • Which promotion they responded to when they initially bought from you
  • Who in the company made the purchasing decision
  • Who influenced the purchasing decision
  • Who in your company dealt with the customer initially
  • Who in your company deals with the customer day by day
  • Who you normally deal with, day by day
  • Products or services they have bought from you
  • Time taken to make the purchasing decision
  • The cost of producing the products or services they buy
  • How long they take to pay
  • Goods or services they have returned or complained about
  • What they buy from others
  • What promotions they have responded to by buying or enquiring
  • What promotions they have not responded to
Of course every company is different, and that list will be much longer when you start thinking about the various systems you store customer information in.

So the key is to bring all this information together, so you can analyse it and start to better understand your customers’ needs and wants. Business intelligence software, such as Microsoft SQL Server Analysis Services enables you to do just that. What once could only be looked at in its own separate system can now be brought together with data from other systems.

It’s powerful and enlightening - and you get increased loyalty from your customers because you can provide a better product or service. It's an exciting time to be in business!

Monday, 12 April 2010

The sales and marketing conversation

The other day I had a very worrying phone call from someone selling electrical services. I have nothing against electrical services, what was worrying was the way the call progressed.

Almost as soon as I answered he launched into a monologue about his company’s services. Not a short monologue, but a long one. He was obviously reading from a script. Although I was sorely tempted to see how long he would continue without pausing for breath, I didn’t have a 30 minute gap in my day. Despite the obviously fascinating topic of electrical appliances (with plugs) and health and safety, I didn’t feel terribly involved in the call. (I think I could have disappeared to make a cup of tea and he wouldn’t have noticed.) So I terminated it as politely, but as quickly, as I could.

After I quickly checked to make sure this is 2010, and not 1970, I got back to what I was doing.

I suppose telemarketing has made a great deal of progress in that such a dreadfully executed call is now the exception. Most people are not so blatant with their total last of interest in me, my company, or my company’s needs. As far as I can remember, the telephone was invented in order for two people to have a conversation. Not for companies to broadcast information to others. Someone should have told him.

Many companies are good at telemarketing, and some are excellent. Some understand that sales and marketing is a conversation which aims to establish a match between what one company can provide, and what another wants. They know that the value in picking up the phone is that you can receive information as well as provide it. On the whole, people respond much better to people who are interested in them and their problems. It doesn’t mean to say the call will end in a sale, a meeting or even a commitment to the next stage, but it does increase the chances.

The best conversations leave both people feeling interested, fulfilled, and eager to continue at some time in the future. It will take me sometime before I can talk to anyone about electrical appliances (with plugs) without laughing. Now, that’s not right, is it?

Tuesday, 2 March 2010

It’s not about the numbers

I must be the last business person alive to read Jack Welch and the GE Way by Robert Slater. Not something I’m proud of, but at least I’m getting around to it now. It’s a better book than I expected.

A theme that comes up over and over again is Jack Welch’s insistence that business is not about the numbers. “Don’t focus on the numbers”, he is supposed to have said. “Numbers aren’t the vision; numbers are the product. I never talk about numbers.”


Yet it is equally clear that Jack Welch cared deeply about the numbers: cost control, market share and profitability. So what’s it all about?

Of course Welch was right – the financial numbers are the result of everything else you do. If you get the rest of business right – the right people, the right products being sold into the right markets, and the right focus on quality, the financial results will also be right. And GE’s numbers were right.

According to Slater, Welch focused on getting the right people into top positions, and on sharing good ideas between different businesses – both internally and externally. He was also a big fan of Six Sigma – the quality system with a big emphasis on measurement.

So Welch used numbers to inform him of what was going well and what needed attention. He focused on making sure things happened when and where they were needed.

Oddly enough, it’s just what the rest of us need; even though we are not running GE. Because no matter how loud we yell, or how hard we try, getting the numbers to improve without carrying out all the necessary stuff that goes before, isn’t going to cut it. We should put our focus on the things that build better products and services for customers, and the things that get them to market faster. Then the numbers will take care of themselves.

Thursday, 25 February 2010

The Death of a Metric

When a new metric is born everyone is hopeful it will have a long and useful life. They want it to get lots of attention and be responsible for improvements in how the organisation operates. Everyone hopes that this metric will be popular and profitable, and be discussed in board meetings and within project teams.

Some metrics do grow up to be shining examples of how performance measurement can transform organisations. They are responsible for positive changes in the way things get done. But not all.

Some metrics die young and never reach their potential. Here are 4 good and bad reasons why are metrics killed off:
  1. The metric encouraged the wrong behaviour. Despite everyone’s best intentions the metric encourages wheel spinning instead of real results. A poorly conceived metric can encourage short term profit at the expense of customer satisfaction, quality or the long term health of the organisation. Too much focus on financial metrics can has this effect. These metrics deserve to die.
  2. The metric gets forgotten. This is frighteningly common. Every new initiative starts out bright eyed and bushy tailed, but then reality sets in. The data takes time to find, or inconsistencies are found. First one month is missed, then another. No one asks about the new metric. Soon everyone has forgotten about it. More good metrics get forgotten and die through lack of attention than people realise, losing enormous potential to improve. These are metrics in search of a champion.
  3. The metric shows poor performance. This is the worst reason to kill off a metric, but one of the most common. Instead of treating the metric as a learning and improvement opportunity, it is treated as a PR disaster and quietly buried. Even though the metric was actually doing exactly what it was supposed to – alert management to an area that needed attention. If you have a metric in this state, consider whether it is a lead or lag indicator, and perhaps supplement it with some lead indicators.
  4. The metric has improved performance and is no longer needed. Successful metrics can outgrow their usefulness. Once the new behaviours have become part of the culture, the metric is no longer serving any good purpose and needs to be replaced with something that will stretch people more. Metrics love to be killed off for this reason – they can die happy.

Metrics, like people, are complex little beasties who need care and attention to flourish. They need champions who are determined to get metrics working well, even if it means a little adjustment as they are growing up, just like people!

Thursday, 7 January 2010

The Squash League

During my younger and fitter days I played squash. My club had a squash league which most of the players joined – whether they were county standard or huff-and-puff standard like me. The fact that most people participated, and enjoyed the leagues, was a testament to how important measurement was to us all. We WANTED to know how good or bad we were. We NEEDED the motivation of playing better players and winning games against our peers. We CRAVED the practice that would make us better.

Such enthusiasm is in marked contrast to how most of us perceive measurement and keeping score in a work situation. So what’s the difference?

Firstly, the squash leagues were designed to measure like with like. If you got put in a league that was too difficult you lost games and slid down the leagues until you found your level. Equally good players rose through the leagues until they found worthy opponents. I never had to be humiliated by playing county players and they never had to waste their time while I repeatedly ran to the corners to fetch the ball. We compared ourselves against similar standards. This is important. If we want measurement to be effective at work we have to be careful how we compare measures. A salesperson working in a complex and difficult market would be best compared to others in a similar situation, whether internal or external to the organisation. Comparing her to someone working in a boom market isn’t going to produce good results; more likely cause resentment and be de-motivating. Whereas comparing people in the same division, or selling the same product, or if the section is large organising results by “leagues” can create positive competition. I’ve seen this work well and badly in large organisations.

The second difference is the way the scores are used. In my squash club I was accepted as a member by good, bad and indifferent players alike. There was healthy competition and encouragement to improve through coaching and “club nights.” Club nights put players of all abilities together so better players could help weaker players. It was done in a spirit of fun, learning and mutual cooperation. Beginners, older players and plain lousy players were accepted just as much as the stars.

Thirdly, there was no blame culture. No one got reprimanded for losing a game. No one got taken aside because they had lost 6 games in succession. No one was ever asked to leave the club because their volleying was too poor. As a result we all participated enthusiastically and eagerly awaited the results of each league reshuffle.

So how can this be replicated at work?

Working hard to engender a no-blame culture is important. If measurement is used as a rod to beat people with, there should be no surprises when it isn’t embraced enthusiastically. Creating a learning environment is also important. If we wanted to climb the leagues, we invested in coaching and hours of practice.

Measurement pointed out the difference between our aspirations and actuality – and work is no different. Improvement comes through taking appropriate actions, such as training, coaching, or doing more of something.

I hate to think where I might be in the squash leagues now – even if I could find my old racquet. But the lesson in improvement and measurement is useful, and doesn’t require nearly so much huff and puff!

Thursday, 17 December 2009

Measurement is fundamental to performance

I was faced with a task today where I had no immediate way of measuring my progress. Not being able to clearly see my way through a job is frustrating and does not encourage me to perform at my best. It got me thinking about how important it is to be able to see how we are doing vis-a-vis expectations.

It would be a little like driving a car without a speedometer or the ability to measure distance. “Are we there yet?” would be met with “Oh, I think so, a bit further maybe. We will recognise it when we see it!”

We are so used to everything being measured – from the miles that we drive to the hours that we work – that we barely give it a second thought. But the frustration in getting to Birmingham when we don’t know how fast we are going, how far away it is, or how far we have travelled would be significant. Imagine not knowing how much money is in your bank account, or what time your favourite television programme was on. The hit and miss fiasco that would be the weekly budget, or trying to guess when to tune in would be farcical.

Yet how many jobs at work do we tackle without measuring them? Quite a few. How many could be improved through some form of measurement? I would suggest, quite a few.

“The odds of hitting the target go up enormously when you aim at it” is attributed to Mal Pancost. I’m guess he was taking as read that we know how far away the target is.

Thursday, 12 November 2009

What gets measured gets done

Want to lose weight? Count calories.

Want to get fit? Count miles cycled, rowed or run. Count beats of your heart.

Want to make more sales? Count the number of meetings set, the number of telephone calls made, the number of opportunities in your pipeline.

Want to develop key accounts? Count the training courses your sales people attend. Count the time they spend with decision makers.

Want to make progress on an important project? Count binary milestones passed. Count time spent on the project. Count project reviews. Count meetings with stakeholders.

Whatever you are trying to achieve there will be things you can count that give you an indication of progress. It is only an indication – the number of calories consumed doesn’t tell you whether they came from cranberries or camembert, celery or steak, but total calories consumed is extremely helpful in the battle of the bulge.

It’s the same with improving business performance. Training courses don’t directly increase sales, but over time there is a correlation. Counting sales training attended is very likely to result in improved account relationships and improved sales.

When I was practicing public speaking someone once pointed out that no one had ever been known to get worse through turning up to meetings and giving speeches. Counting the number of speeches given was as pretty good indication of the quality of the speaker. It was no coincidence that the best speakers were also those who had given the most speeches and attended the most meetings.

Making these counts visible has a multiplying effect on behaviour. When you can see the counts, and everyone else can see the counts, it encourages less calories, more miles, more meetings, etc.

So whatever you are trying to improve, finding things to measure is the first step. Don’t worry if your measurements are not a perfect guide to the achievement of an objective, just start by measuring. In my experience of working with a variety of clients, the simple act of measurement often has a dramatic and positive result.

Try it. Start counting and see whether what you are counting doesn’t start thoughts about how you can do it better, faster, or more effectively.

Tuesday, 10 November 2009

Data Centred Decision Making

Making decisions can be tough: so many choices and no guarantees of making the right one. I’ve recently seen the decision-making process behind two decisions and both were instructive.

The first was for a social group where an interesting ethical question came up. The question and replies batted backwards and forwards. There was no right or wrong answers, but plenty of indignation and lots of opinion. Then someone sent a simple email containing the data relating to the problem. They had gone to the archives and dug up the relevant history and presented it clearly and dispassionately in an email. It was strong stuff and illustrated beautifully the uncomfortable feelings that everyone had about the dilemma. Getting the information took a bit of time but the effect was convincing and helped the group enormously.

The second was a decision at work where again feelings ran high. My co-Director had one opinion and I a different one. We discussed and argued the point but couldn’t get agreement. We decided to break the meeting to go do some research and analysis. When we came back together the decision was obvious – the data spoke volumes. We went away with a clear decision and no hard feelings.

Data centred decision making takes more effort because you have to go and get the data. Sometimes that takes quite a long time, but better decisions come out of the process. When you look at the two examples above, I think both were solved faster and more amicably by having good data.

Not all decisions lend themselves to data-centred decision making, but it’s worth asking “what data is available?” even if it only contributes to the process. Sometimes the results are surprising.

Friday, 6 November 2009

Aspects of improving performance

There is a strong feeling that the business world is changing. Social media is rushing towards us at an uncomfortable pace, the internet is evolving and financial crises of varying types are still with us. Added to which, many people’s jobs have changed over the last 10 years. There are many more information workers, people who frequently know more than their line manager within their field of expertise.

Yet the fundamentals of business apply. The business of business is still business. To make a healthy profit in today’s fast changing and difficult economy it is necessary to have eyes everywhere and good information. Perhaps it was ever thus, it just feels more important than ever right now.

The 4 E’s are a good starting point:
  • Effectiveness
  • Efficiency
  • Economy
  • Ethics
Effectiveness is whether we are furthering our goals. Obviously, you can’t measure effectiveness unless you know what your goals are. Having the right strategy is still Top Dog.

Efficiency is getting things done in a time and resource efficient way. Doing the wrong things efficiently won’t help you be more effective, and doing the right things too slowly will make you uncompetitive, which is why efficiency comes after effectiveness. In our “Getting Things Done” culture, it pays to remember to pay attention to Effectiveness before turning to Efficiency.

Economy is making sure you don’t spend too much on being effective or being efficient. Most organisations, large or small, have good systems to keep tabs on this one.

And ethics is ensuring you don’t trample over other people or squander the earth’s resources in pursuit of your dreams. An increasingly important dimension to business and living in the new world order.

Simple? On paper, sure! In practice? Well that’s where the art, science and monitoring of business starts.

It is down to each person, each team and each organisation to figure out what the 4 E’s mean for them, and how to measure them.

Friday, 9 October 2009

Expertise and expert performance

One of the most fascinating concepts I have come across in a long while is that of Expert Performance. This is a body of work on how expertise is gained, and what sets experts apart from the rest. Studies have been done across a range of disciplines. Malcolm Gladwell’s wonderful book Outliers referred to some of this work.

Two fascinating ideas come out of the expert performance research:

  1. It takes an average of 10 years to become expert in something

  2. Practice means deliberate practice, not doing by rote
The 10 years figure is interesting, and provides a guideline for how much time is required to master something. However, it is the “deliberate practice” concept which is most useful to us in our day to day activities. That is practice which has its prime objective of improving performance. It may sound tautological – surely all practice is designed to improve performance? Not so. It is perfectly possible to spend 1 hour practicing French verbs with half a mind on what is for dinner, or whether it will rain. Alternatively, I hour can be spent in a structured way with reviews every 15 minutes so that learning is maximised. Of course the latter is more difficult and more tiring, which is why many of us prefer to keep half a mind on dinner.

Deliberate practice means pushing the boundaries of our practice – expanding our capabilities and working on new areas within our field. It also means getting feedback on how well (or badly) we are doing, and practicing afresh in light of that feedback. To build expertise it is necessary to reflect on the processes and methods used to perform well.

This is important in performance management. Whatever we are striving to do well requires both practice and feedback, both external and internal. It means keeping a record of our performance and improvements. All of which takes effort, but the months and years pass whether or not we are gaining new skills and pushing our professional capabilities forward.

And of course deliberate practice and monitoring progress is as applicable to a business or department as to an individual. The larger the group, though, the more structured the systems need to be for providing feedback.

Friday, 18 September 2009

Perform better with better feedback

Do we perform better when we get clear feedback on how we are doing? You bet!

Some readers will know of my experiments with getting more miles out of my car, and the successes attained by becoming more aware of my driving. But I admit that I don’t always drive carefully, sometimes I just put my foot down and go.

At the beginning of the week I had the chance to drive the new Toyota Prius, with its full range of gadgetry designed to get the maximum miles out of every gallon. This car gives immediate feedback. When my foot presses on the accelerator, the mpg needle drops like a sulky teenager; when my foot eases off a bit, the needle rewards my good behaviour with measurements of 70, 80 or 90 mpg. It is very effective. It is almost impossible to drive irresponsibly in this car. That needle takes all the fun out of flooring it.

This is a wonderful demonstration of how behaviour alters when feedback is immediate, measureable, and appropriate. There are no ifs or buts because I know how I drive my own car when I have less feedback.

In business, therefore, we need to design feedback systems that are close to the desired behaviour and give timely feedback. We need systems that measure and reward behaviours that build towards company objectives, and lead to excellence in the business. Some of these systems may be for big, strategic things. Others may be hygiene factors that nonetheless impact on the efficient running of the business.

They key is to identify what is important, decide on what should be measured, and to make it visible. It is the visibility that makes the difference.


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Thursday, 13 August 2009

The Feynman Index

Someone asked me an interesting question about measurement:

“If what gets measured gets done, are we measuring the right things? What would happen if we started to measure different things?”
What indeed?

It nicely encapsulates the problem of measurement. For any given objective we can identify things to measure – many of which either have, or appear to have, a bearing on the problem. Sometime they move us closer to our objective, but sometimes not quickly enough.

Those averse to measurement love this, because they take any weaknesses as a reason not to measure. But that’s missing the point. Any valid measurement is better than no measurement, even if it’s imperfect. Why? Because without a measure you are left with subjective views. Subjective views will be different each time you look, and provide no clear benchmark for whether things are improving or not.

But the original question was interesting – what if we started to measure different things? What if we measured things that appear a little crazy?

I have been quite inspired by reading Richard Feynman: a brilliant chap who was constantly curious. What a marvellous quality – to be constantly curious. Most of us work hard at being blasé about how much we know – experts at this, experienced at that. Few of us want to expose how little we know. Yet here was an acknowledged genius who was quite prepared to admit what he didn’t know – and was always curious to find out more.

One of his life’s ambitions was to visit Tuva – a Russian republic in Siberia. As far as I can make out he had no better reason than that it sounded like a place that didn’t exist, was in an obscure location and therefore had a huge allure for him.

Here was a dedicated and brilliant physicist who devoted a great deal of his life to physics research and teaching. Yet he also had a number of seemingly unrelated obsessions. Did his obsession with Tuva teach him anything about physics? Did his love of playing the bongos help him to relate to his students better? I suggest they did.

Feynman, as a physicist, understood the importance of measurement. In physics measurement makes the difference between something being properly understood or not. As Feynman points out, something can appear to be correct when in fact it is not. It is the accuracy of measurement that exposes the error.

So The Feynman Index takes a sidelong, mischievous swipe at the problem/objective and asks “What Might I Measure Here?” What curve ball or seemingly off-centre measurement might teach me something I don’t already know? It doesn’t matter if it doesn’t work – replace it with something that works better.

Sometimes the “Feynman Index” type measurements tells us more about the central problem than we might possibly guess from the outset… In addition, not instead of, the mainstream measurements.