An example of a powerful metric in use

Mortality ratios

Yesterday’s posting about performance metrics in the UK’s NHS system provoked much comment and discussion. The BBC’s Panorama investigated the discrepancies between certain hospitals’ own assessment of their performance, and independent assessments of their performance. In rather too many cases the discrepancies were significant.

One metric that caught my attention was discussed by Professor Brian Jarman of Imperial College, London. The hospital standardized mortality ratio compares the number of deaths expected and the number of in-patients at a hospital who actually die. Professor Jarman’s response to the interviewer’s questions was particularly instructive. When asked about the relevance of the metric he replied that it could indicate:

1. Data had been incorrectly entered
2. Something was wrong with the calculation
3. There is a problem with patient care

And he listed these possibilities in that order. In other words, the metric was an indicator that highlighted the need for further investigation. It was not an indicator that provided cut and dried proof of a problem. He went on to say that in one instance the ratio had highlighted a problem for ten years.

This is how performance metrics are designed to be used:

• An alert to a potential problem
• A need to investigate further
• Trends (upwards, downwards, consistently bad, consistently good) tell you more than any one single metric.

From my own experience I know that the NHS is not the only example of this mis-match between reported performance and actual performance. If there is any justice for tax payers this will run and run.

All snowed up and no place to go

Like many other people in the South East yesterday I got snowed up. It took me two hours to go round one roundabout and come back to work. No roads were gritted, and cars were sliding around in their unreasonable and unrealistic hope of getting home. In my short journey I must have seen 3 or 4 blue flashing ambulance lights and multiple roadside rescue vehicles skidding around like everyone else. The radio reported one serious accident that the ambulance was unable to get to because roads were gridlocked. Chaos is too neat a word to describe what was happened on Berkshire, Hampshire and Oxfordshire roads yesterday.

But, as Scarlet pointed out, tomorrow is another day so after a makeshift night at the office I’m up to see whether today brings brighter weather and passable roads. Surprise, surprise, after the complexity of the argument about measuring the performance of local councillors, the local Reading Transport web site hasn’t been updated since 15.30 yesterday. I guess they were too busy getting home, or maybe they thought there was no point as stranded cars don’t have internet access anyway. I doubt it’s the responsibility of part-time Councillors to update the web site, but between full time council employees, and local Councillors, basic services like information and gritting were not available.

It seems every year that the local authorities get caught out, which means that every year we get caught out. After the fiasco that has been Eurostar over the last few days, and the complaints about lack of information, even if gritting lorries couldn’t get out you would have thought that someone somewhere would have made information a priority. But even though it’s taken me a full 30 minutes to tone down this blog post, the latest traffic information is still missing.

I have no doubt that it's not much fun being in the firing line when the snow starts to fall, but winter happens approximately once every year and preparing for it seems a sensible precaution. The only gritting lorries that were seen yesterday weren't working. It may be performance under pressure, but surely tax payers deserve better?

Measuring performance of local Councillors

Public sector performance indicators are something of a minefield as the National Indicator Set proves. They are costly and difficult to collect (sometimes not adequately available at all), not always representative of a job well done, and can get manipulated in horrific ways.

So why does anyone bother?

Well, performance indicators are exactly what they say on the tin – indicators. They are not a perfect measure of performance, but an indicator. And they are a lot better than nothing.

In measuring performance of local Councillors there may be differences, for example, in the type of enquiries that Councillors are asked to deal with (large, small, difficult and easy enquiries), but on average they will even out and provide an indication of workload. They cannot show how diligently a Councillor attends to an enquiry, or the quality of the outcome, but they will give an idea. Ditto meeting attendance, voting, etc.

In my area a computerized system is now used for Councillors to log enquiries, and details from the system are available on request under the Freedom of Information Act. However, it is optional to use the system and now that some of the information has been published several Councillors say that they do not use the system at all. They are effectively bypassing accountability. If this particular Performance Indicator was published as a national (or even local) league table then you might find they suddenly started to use it with more gusto; otherwise they look like shirkers.

Politics and all its power is an ideal hot-house for cheating the statistics in various ways. If I am prepared to cheat my caffeine challenge by eating chocolate, imagine what an elected politician is prepared to do to make themselves look better in the eyes of voters. Lambeth and their ghost libraries was a deliciously embarrassing example.

But my opinion, and that of many leading organisations, is that working hard to get performance indicators as indicative as possible of true performance, and to have good systems to track and publicize the results, does improve performance. If information relating to Councillors’ work were available on web sites more easily, instead of having to be requested and posted piecemeal in blogs, it would have a great deal more power. Voters would have better information to base their decisions on.

It is important to remember that performance indicators are a management tool, not an end in themselves. By that I mean they are one tool in the tool bag, to be used with care and backed up with other information as necessary. The weaknesses of performance indicators are often used as an argument not to use them (mostly by those who come off worst in the performance stats). Providing they are used sensibly they are extremely valuable and work as well in politics as they do in the private sector.

Two very different Parisian examples of customer service

And why customer service has to be built into the system

There are two big venues in Paris that attract millions of visitors every year. They are each very different, and from a customer service point of view make a fascinating contrast.

The first, of course, is Disneyland. Disney is famed the world over for its customer service ethos.

Randy Pausch tells a lovely story, long before he ever worked for Disney, of when he visited Disneyland as a child. During a very happy day at Disneyland he and his sister decided to buy a present for their parents. They paid, what was for them a lot of money, for a lovely Disney teapot. The Disney china teapot was barely out of the shop before it slipped and was in thousands of pieces on the floor. Two very upset children stared down at their precious but broken gift. A Disney attendant had seen what had happened and suggested they take it back to the shop. But, howled the children, it was our fault, why would they replace the teapot when we have broken it? Just try, he suggested kindly. To their surprise the teapot was replaced with a smile and two happy children were able to present a Disney teapot to their delighted parents.

It’s a great story, and worthy of being passed on.

Now the second Paris venue is spectacular in a very different way. Versailles is a world away from Disneyland in so many ways, and yet also attracts visitors from around the world in vast numbers. The splendours of 18th Century France, the ambitions of the Sun King, and the sheer dazzling opulence of this gorgeous palace make it a feast for the eyes. However, the notion of customer service is lacking in just so many ways.

At a recent visit when I had cause to complain, which I did in my most reasonable French. I was met by argument, bureaucratic forms and a complete lack of will or ability to put anything right. I was told that no one had ever complained like this before (how dare I?). It felt like I was taking on the might of the whole French state instead of pointing out that I had been mislead when buying two tickets. Once I had been worn down by his complete unwillingness to do anything to improve the situation, the young French man seemed satisfied that these unreasonable English were leaving. The amount of money was tiny, and it would have been so easy to have put it right. But he was happier to see us leave whilst knowing his organisation was in the wrong, than to fix the situation.

From a business point of view, of course, it was not his fault. He had been trained to be unhelpful. He could see no benefit to either himself or to his organisation in putting things right. The systems at Versailles do not support him in making a good decision when faced with a complaint. It is shocking in today's world.

It is a stark reminder that customer service must be built into the system. You cannot expect people to work against the system and help customers; the system has to be there to show them what great customer service looks like.

An abuse of power

The UK is today without a postal service. Their 120,000 strong unionised workforce is angry at their management’s reforms of the business and so has gone on strike.

The head of the Communication Workers Union Billy Hayes believes he is in a stronger position than Arthur Scargill and the coalminers in the 1980’s. Hayes has sweetly pointed out that you cannot stockpile post. Hayes and his merry men have threatened more strikes as the festive period approaches. I'm guessing this is a man who never read How to Make Friends and Influence People.

Hayes might have forgotten that the miners’ strike did not end happily. I doubt this one will either.

The world is changing. Indeed the world has already changed. During the Great Strike of 1926, newspapers were not delivered, but there was enormous support for the miners.

Today the support is for the alternative suppliers who are prepared to deliver our mail, and outrage at the postal workers’ action. At the heart of the need for modernisation is the vast change that has swept across all forms of delivery services, namely the internet. Whilst I may not be getting any post today, my inbox is as full as ever and promotional paper mailings are simply being replaced by their electronic email equivalents.

Providing an excellent service that people want to use is the only way that this war will be won: an option the union doesn’t seem to have considered.

Holding the country to ransom, putting up prices and reducing service levels is a strategy that appears to have some serious flaws. Abusing power rarely, if ever, has a good outcome.

From Material Girl to Eco Warrior

I am a child of the ‘60’s who still looks back on the ‘80’s as her glory days. I worked in London and for the advertising agency that worked on the BMW account (amongst other things). I used to joke, although it doesn’t sound so funny now, that I changed my car when it needed washing. We got a new one every six months. It seems impossible now, when I happily drive a car for 10 years, but back then it was part of a heady lifestyle that I took to like a duck to sparkling water.

I guess I’m a pretty unlikely eco-warrior.

But I have to admit I have become increasingly focused on environmental issues. To some degree it’s inescapable: the newspapers are full of it. Yet to many it’s still “someone else’s problem”. And perhaps to me too, after all it’s a big shift in thinking – moving away from the “I-can-use-up-and-wear-out-what-I-like-so-long-as-I-can-just-about-afford-it” mentality.

To be honest, my thinking is changing kind of slowly. My car is still too useful not to drive whenever I want. I am more aware of the price of petrol, and how many miles I can drive on a tankful, but as long as I can afford the petrol it is still pretty much an academic exercise. It’s only when I stop making semi-necessary journeys that I can really say that I am on the first rung of being a trainee eco-warrior.

I’m also slowly becoming more aware of the real cost of the stuff I buy. Changing my thinking away from just its price tag, to considering the raw materials that go into it, producing the thing, me using it and then disposing of it. Cars, computers, even my beloved books, all have energy costs to them that I wasn’t really aware of before.

The government publishes their strategy for moving us towards a low carbon economy today. Their introductory paragraph is heartening – they suggest that low carbon living might actually create a better kind of society, and a stronger, more sustainable economy. When compared to the throw-away lifestyles we have become used to, that has to make sense.

So Material Girl turns Eco Warrior ….

Floods and power cuts – just another day on the London Underground

I have been in London twice this week and I have been delayed on the underground twice. First it was flooding that closed a bunch of stations (including one I needed to use), and today it was power cuts that closed the Circle line for I don’t know how long. Readers outside the UK won’t recognise the details, but will certainly recognise the frustration this adds to the already arduous task of moving around a capital city.

Thankfully, in the London of 2009, this is a relatively rare occurrence. However, London of 2019 or 2059 might tell a different story. Scientists tell us that we need to prepare for climate change and that climate change is going to mean more extreme weather conditions occurring more frequently. Temperatures will get uncomfortably hot more often - perhaps 70 days in the year instead of the handful we experience at the moment. We will have less rainfall in the summer, and more in the winter.

This is the pioneering work being presented by UKCIP, leading the world in trying to predict what the effect of pumping CO2 into the atmosphere will have on our climate. UK Climate Projections 2009 is a brand, spanking new report that uses the best scientific and statistical techniques available to predict what the UK climate will feel like in 10, 20 or 100 years’ time. What I find particularly impressive, however, is that all of the data is being made available, including the assumptions of, for example, how much CO2 we continue to pump skywards.

They have included, for the first time, the full range of confidence levels that can be extracted from the data. This is good news for all those journalists who write for The Sun – plenty of headline grabbing scare mongering to be had for those who go in for such things. But also a wealth of valuable data for professionals who want to make the best of available data to look 50 – 100 years into the future. Which is, coincidentally the life of a building or a railway track for example.

Unless our tube and railway infrastructures are upgraded The Sun’s headline writers will have had it about right – we will be in for summers of misery and winters of cancelled train services.

All this was hosted at the Institute of Mechanical Engineers – perhaps the very people we should be blaming for getting us into this CO2 pickle in the first place. It was engineers who taught us how to use carbon-based fuels with such efficiency. But let’s not quibble – they are making up for it now with some intelligent and thought provoking debates about how to move forward. And we have to face facts – there are not too many of us prepared to give up our washing machines or cars for the sake of the planet.

With a bit of luck, however, and some critical analysis of the data, policy makers will have a better view of what’s in store going forward. Which means I will be much less forgiving when they close underground stations for either “unexpected” floods or power cuts due to a certain type of leaf on the line.

In the meantime I’m resting my tired feet after having trekked half way across London to get home. All that, and it was a hotter day than the weather forecasters had predicted. Ironic, non?

UKCP09 is published by UKCIP and is available to download from

www.ukcip.org.uk.

Going green: a confusing business

We are all going green - environmentally green that is. But do we know why? Or how well we are doing? Or indeed, how much is enough.

Yes, we know about carbon emissions. Yes, we know about climate change. No, we don’t want polar bears to go extinct. But these are all relatively vague notions. We can’t see carbon emissions. We quite like it when it’s warm and sunny. But making the link between global warming, polar bears and switching off the lights when we leave a room doesn’t always happen. Wind turbines are wildly popular, but we are pretty much opposed to nuclear power stations; without having clear facts on either.

Am I being unfair? It’s not that I think we haven’t got a grasp on this because we are stupid; more that we are not being given clear data. The green revolution is a confusing business – and little is being done to make it less confusing.

Data, data, everywhere
Don’t get me wrong - I am not saying is that there is a shortage of facts and figures. We overdose on them – they are sprinkled like pepper through newspaper articles, web sites, and news bulletins. All utterly convincing and designed for effect.

Only recently I went to a meeting about London’s energy issues. The headline ran:

London is responsible for around 8% of the UK’s emissions, producing 44 million tonnes of CO2 each year.

It sounded reasonable enough. The evening started with some facts and figures: London is home to 7.5 million people for example. Hang on a minute – that’s 12.5% of the UK’s population. Then you have to add in the effect of tourists, commuters and those passing through the airports, tube network and railway stations. So if our most populous city is producing less than its fair share of emissions, doesn’t that mean that London is already doing pretty well? Of course London doesn’t have a power station, or heavy industry, both of which spew out carbon by the aircraft load.

So I am left with no benchmark as to whether London is doing well or badly in the carbon battle. As the policymakers, scientists and business people who also attended didn’t say, I’m guessing they didn’t know either.

Clear data are important
Having a straightforward and consistent idea of how well or badly we are doing is important. It is crazy to have to do intellectual gymnastics in order to understand the effect of our behaviour on our purses and the planet. And when the experts can’t add it all up, something is badly wrong.

The debate about carbon emissions is everywhere at the moment – from how we create jobs to saving polar bears. Much is without quantifying the problem at either a local, national or global level. So we can’t be surprised when Porsches still overtake me at high speed on the M4 and people don’t insulate their lofts.

Churchill, the energy crisis, and inspiring action. What a day!

Three things happened to me yesterday that made me think about great leaders. Or more specifically, what it takes to inspire action when it’s needed.

Firstly I found myself sitting in the sunshine next to London’s Churchill Museum and the Cabinet War Rooms. I’ve never visited and couldn’t yesterday because I was too late. With half an hour to spare I simply watched the world go about its business. Tourists, civil servants taking a quick smoking-break and security guards watching over H M Treasury are an eclectic lot. But it was Churchill’s achievements that occupied my mind: how he galvanised not just the government and the military, but the whole country into doing what was necessary to win the war.

Musings on Churchill were not reducing CO2 emissions, however, which was the focus of the debate I was due to attend across the road at the Institute of Mechanical Engineers.

Livewire Isabel Dedring from the Mayor’s office kicked off the evening stressing the importance of reducing emissions, and the leading role that London sees itself playing. She went through the variety of initiatives that were needed from managing waste, insulating homes and making City Hall more environmentally acceptable. Despite massive political will from this clearly capable lady and her boss, progress appears to be agonisingly slow. The difficulty of convincing people to make the simplest changes like insulating their lofts, even though grants are available and it will save them money, is indicative of how big a mountain there is to climb. But Boris with his electric car, and Isabel with her brains, are clearly a team to watch.

My evening ended with Churchill, though. Driving home I was listening to Dr Peter Sandman talking about panic and the swine flu pandemic. He talked about how leaders often get it wrong when trying to avert panic. Denying the problem, or pacifying people can create panic instead of action.

He also talked about Churchill and how he got the tone just right. He did not say: “don’t worry – its all going to be fine – I’ve got it under control.” Whilst that might have averted panic it would certainly not have inspired action. What he did was send out a message of deep concern. He managed to convey the severity of the situation whilst inspiring confidence in this plans. He also made it clear that everyone’s efforts would be needed.

The UK is putting some of their best scientific, engineering and political brains to work on the problems of CO2 emissions and global warming, yet many of us routinely leave lights on and don’t think about our energy usage.

What struck me was that the principals of inspiring action are common: whether you are trying to win a war, lower CO2 emissions, survive the recession, change a business’s strategy, or inspire a project team. The difficulty is that they are not that prevalent.

Energy rhetoric, but little data

The Secretary of State for Energy and Climate Change, Ed Milliband, argued in The Times yesterday that “we must try every option to shift to a low-carbon world”. He reasoned that energy security and climate change commitments were sufficient incentive to back the government’s policy of building new nuclear power plants.

I, for one, would like to see more data.

Let’s not forget that nuclear power is also a threat to the planet. Whilst melting ice is not a popular move with that most potent symbol of our planet – the polar bear - neither is waste that stays radioactive for hundreds of thousands of years. The choices may not be palatable, but surely all the more reason to have good data, presented clearly.

Renewable energy, he said should not be dismissed: wind is producing enough power for 2 million homes. 2,000,000 is indeed a large number – an impressive number even. But it is a meaningless number in the debate about energy and climate change. How many homes and businesses need power? And at what cost?

Milliband rightly pointed to the future with ideas such as “clean coal” which as soon as the technology is ready the government will ensure will be 100% committed to. Whilst he was quick to quantify the potential jobs that will be created through this R&D, he was less keen to share the costs even though they are equally quantifiable.

Neither did he talk of other technology which might provide low-carbon alternatives a great deal more palatable for our polar bears than sitting on radioactive waste for a million years. Yet they do exist.

This whole issue is quantifiable: cost of power, amounts of subsidies, carbon emissions, temperature changes, sea levels, thickness of ice, number of species. I could go on – they are many and varied and all absolutely quantifiable. Yet for some reason we prefer pictures of polar bears to clear data which would help us make good decisions about what mix of power to rely on.

The UK has armies of statisticians paid to collect, collate and present exactly this data. Couldn’t Mr Milliband have included some of their work? He was writing for The Times, after all.

4 ways to make better decisions

I read an article recently about how groups make decisions. It struck me that whilst not being able to make a decision is harmful to performance, making bad decisions is even worse.

History throws up some monumentally bad decisions that serve as a reminder to us all that smart people sometimes get things spectacularly wrong.

Deciding to launch the Challenger Space Shuttle in 1986 even though a good number of people knew there were problems was not one of NASA’s finest hours. Televised live to a huge audience it was a massive set back to their work, and a tragic loss to the families of all those on board.

Yet what impresses me about NASA is its openness. It has an online database of lessons learnt which is there for anyone to inspect. It has very detailed findings by engineers as well as some of the larger and more significant lessons. I have no doubt that as public-facing data it is less frank and less complete than their internal version, but nonetheless it’s an extremely useful reminder to everyone that lessons need to be, and indeed can be, learnt.

It also gives some confidence that things will actually change and people will learn from such a horrendous accident.

A great deal of research has been done on decision making and how to improve it.

Researchers have identified 4 danger signs:

• Emotion


• Attachment


• Using intuition


• Decisions based on self-interest rather than the greater good.

All make us a little uncomfortable because they are certainly not confined to the historically dreadful decisions, but also crop up in our day to day work. And just knowing that list isn’t necessarily going to save us from a mother-of-all-foul-ups.

So, how to avoid bad decisions? Well, that makes interesting reading, too. You might be surprised to hear that all four recommendations involve other people. Far from “committees” producing camels, they actually produce better decisions. Recommendations include:

• Finding safeguards for risky decisions


• Get someone to challenge your views


• Not having all the power vested in one person


• Monitoring what happens afterwards.

Four simple and effective ways to make better decisions.

Targets and scorecards have been shown over and over again to be harmful if they are measuring the wrong things. Deciding what are the right things is easier to say than it is to do, but that little list above might just be some help.

The future's bright - but largely ignored

Britain is to have a new power station. It is claimed to be cleaner, more efficient, and, wait for it, will be coal fired. Yes, you heard – coal fired.

Like me, did you just check your calendar to see whether it really is 2009? That would be 2009 in the 21st century when we are all well aware of the

adverse effects of burning coal (greenhouse, gases, acid rain, the impact on the land, and much more besides). Plus we are doing all this in the full knowledge that coal is not a renewable energy source. It is the sort of decision that might have been excusable in the 60’s or 70’s, but surely not today.

So what’s the alternative?

There are

renewable energy sources - wind, solar, tidal and water. These are clean, with relatively little impact on the environment, but will never produce the majority of our power.

Then there are nuclear energy sources – nuclear fission and nuclear fusion. Fission is in use today, with the main disadvantage of the extraordinary long time that the waste remains radioactive.

Nuclear fusion is not yet in production, but it has so many advantages you wonder why. It is clean, produces no greenhouse gases, with either no or little radioactive waste, and is safe. And it can produce electricity in the amounts we need to support an increasingly power-hungry world.

Generating power using fusion would answer most of the problems we currently have with energy production. That’s a pretty big thing for future generations, but it is largely not debated and not sufficiently funded. The reason? We are still some years away from a working fusion power plant and it doesn’t have the easy-sell that renewables have.

More research is needed to harness the power that we know can be created through fusing atoms together. We have some of the best scientific brains in Europe working on it, but they are hampered by lack of political will and lack of funding. More money is spent on ringtones in the UK than is spent on developing fusion. That says something about our priorities.

So what’s the link to metrics, and performance management? You guessed it – targets: government and EU targets. We have an EU mandated target to achieve 15% of our energy from marine renawables by 2020. Laudable in itself, but it means that the long term and the very significant benefits of

fusion are left off the agenda. That can’t be right.

Is it another case of measuring what’s easy, and palatable, whilst omitting the more challenging measures? In this world of 30-second sound bites and our obsession with celebrities, we risk neglecting what’s really important. Are we avoiding the decisions, and targets, that will make this planet a habitable place for our children’s children?

Fit for purpose

Performance management and business intelligence somehow imply providing something more than the basic product or service that your customer might expect. But this is not so. Performance management is mostly about providing the right environment for an organisation to consistently and efficiently meet the standards expected by its customers.

Performance management initiatives are put in pace so that the organisation can perform its necessary functions to a good standard. In other words, ensuring its product or service is fit for purpose. Not just occasionally, but consistently.

This occurred to me yesterday as I walked through my local train station. And no, my train wasn’t late. I was struck by something much more important than that: safety.

Like many major towns and cities, Reading attracts its share of anti-social behaviour. But there has been a change in recent years – and a welcome one in my view. The local police are a great deal more visible. The presence of the Transport Police, and their uniformed cousins the Policy Community Support Officers, has made Reading Station a calmer and safer place to be. In addition to the coffee shops and boutiques, it has actually made it a rather pleasant place to be.

The crew on duty yesterday as I walked through the station were approachable and friendly. I stopped and chatted to them, and their Sergeant, about their thoughts on keeping the peace. Despite their youthful appearance, they also remembered a time when the station was a tenser and less safe place to be: a few drinks, and a few mates, easily spills over into disruptions that ruin lives both for the perpetrator and the victim. How much better to fund more police officers to calmly restore order and ensure and good night out stays that way?

Behind the calm and confident exterior of those police officers lies an array of performance management building blocks. There is the programme to get more police and PCSOs on our streets, the selection process, training, promotion boards, and on the job mentoring. All monitored and rolled up into government statistics.

This type of policing might be seen as the tip of the iceberg in work that encompasses so much more. Inevitably there is much valuable police work that that is unseen, unreported, and unappreciated. I have no desire to detract from that. I do, however, think that visible policing is a welcome and necessary initiative.

From a performance management viewpoint, it also a lesson that sometimes we need to take an all-round view of a product or service. In this case it isn’t good enough that trains run on time, although that’s always helpful, I also want to travel in a safe and calm environment.

Thank you Transport Police and PCSOs. And what a nice lot you are too!

The Vision Thing

Why a defined strategy is crucial to performance management

I’m about to give a speech at my local Toastmasters club and I have chosen a rather controversial topic. I will argue, fairly or unfairly, that Barack Obama didn’t have enough of The Vision Thing in his inauguration speech. I have no doubt this will be deeply unpopular.

Obama is remarkable in many ways – not least in his ability to deliver a mighty fine speech. And right now what America needs most is a visionary president.

Part of my reason for choosing this subject wasn’t because I thought Obama needed a bit of help, but that it reminded me just how important vision and strategy is to performance management.

Without a strategy you cannot compare performance, good or bad, to anything. In fact, without a strategy you don’t really know what you should be doing when you get out of bed in the morning.

The ubiquitous scorecard has become a powerful way of monitoring performance in companies and public sector organisations alike. And many have implemented the Balanced Scorecard, created by Kaplan and Norton during the 1990’s.

The Balanced Scorecard is remarkable for two reasons.

1. It monitors four areas of a business: financials, customer focus, internal focus and learning & growth.
2. It encourages measures to be derived from strategy.

I often wonder whether what gets remembered most from their work is the four quadrants, and not the link to strategy. Yet it is the latter which is the more powerful, and at the time was the most ground breaking.

When a company first starts to implement the Balanced Scorecard they often find that their strategy isn’t defined as well as they thought. It prompts debate, arguments, refinements, and more debate. In fact some companies purposefully bypass the strategy step because they know it will be difficult. But once strategy is agreed there is a forward motion that almost takes on a life of its own. Good measures become easier to identify, and performance management becomes a whole lot easier.

I still don’t think we had enough of the Vision Thing in the inauguration speech and shall argue my case despite any frosty looks. But my personal silver lining was that it prompted me to look at my own company’s vision statement and make some necessary revisions.

That Vision Thing matters.

Chief Performance Officer

President-elect Barack Obama has announced that he will have a Chief Performance Officer on his team. Nancy Killefer from McKinsey & Co, a former assistant Treasury secretary, is charged with making the government more efficient, effective and transparent. Oh, and trimming the projected $1.2 trillion deficit.

The appointment is interesting. Killefer has specialised in strategies to improve organizational effectiveness for public sector organisations. Whilst she certainly has excellent financial credentials this is an acknowledgement that this is more than just a financial problem. It is one of efficiency, performance, and accountability.

It will be interesting to see what a management consultancy approach to this problem looks like. Will the real work needed to get accountability as well as accurate metrics be done? We all know that setting targets is one thing, but getting the behaviours right behind the targets is quite another. Measuring performance against the targets is equally challenging.

How Key Performance Indicators (KPIs) are calculated, how cheat-proof, and how well accepted they are, will all make a difference to how well new initiatives work. But well designed KPIs can significantly lift performance and are well worth the effort.

There are real difficulties in getting accuracy and meaningfulness into figures and financials for the United States. It is a big job. There will be lots to learn from how she tackles it and the many successes this focus will generate.

I’m sure we will be seeing a lot more Chief Performance Officers before too long. The US government is not the only organisation going through its budgets line by line but still wanting to make sure it delivers on its promise to customers.