Current measures have huge gaps

Most managers, whether at task, process or organisation level, lack the comprehensive set of performance measures they need to cover all their KRAs (Key Result Areas)

In effect, they’re flying blind

Current coverage is estimated to be as follows:

  • 90% – Financial results – in particular, Revenue, Costs, Profits – at board level, they might even have too many, not too few, to steer their corporate ships – the problem is, if these rear-mirror money numbers add up, directors assume all else must be ‘hunky dory’ so they don’t spot any rocks ahead
  • 10% – Customer satisfactionPrice, Quality and Service levels – most are taken by surprise when customers start to desert them for the competition – customer complaints are said to be taken seriously, but are not
  • 20% – Productivity & Waste levels – most organisations output a variety of goods or services, so combining them all into one productivity statistic becomes meaningless – even more so at sector and national levels – meantime, most organisations, public and private, waste huge proportions of their costly input resources (often 50% plus) yet most are unaware of this and feel they run ‘a tight ship’
  •   0% – Team knowledge levels – quantification of the knowledge resident within any team at any level is effectively zero – members might meet entry qualification minima but, after that, actual accumulated knowledge and experience within a team along with corporate knowledge available to them is left to a manager’s hunch and opinion, and nothing else – yet knowledge is already the most valuable and needed input resource for most organisations in this new millenium
  • 20% – Team motivation levels – An organisation might have a marvellous corporate plan, employ the very latest and best technology and methods, and recruit the very best qualified people but if they’re not happy in their work, all will be to no avail – they’ll do the minimum to get paid – the performance difference between a motivated and demotivated team is not measured in fractions but multiples of whole numbers – yet most managers pay this area little attention – occasional chats with a few of their team backed up by a few turnover, absenteeism and lateness measures suffices – so their enormous extra costs go unrecognised and persist

The picture is even worse at sector and national levels:

  • GDP = The main measure of the output and so health of the economy:
    • But GDP is seriously flawed, mired with many estimates and assumptions
    • This makes it nigh impossible to determine actual output in any quarter or monitor any trends
    • Total public sector outputs are even assumed to be equivalent to the cost of their inputs, so the more money governments pour in, the better outputs, and so sector productivity, appear to be
  • GDP/ Labour numbers or hours = The main measure of national productivity:
    • As GDP is flawed, then this ratio is also flawed
    • It’s also out of date, usually by months if not years – and the days when manufacturing and agriculture (with their quantifiable outputs and inputs) dominated the economy are long gone – developed economies now comprise over 80% services, public as well as private – so ask how would you measure the productivity of a bank, for example? (Answer – you can’t)
    • Despite this inconvenient detail, machines, technology and, nowadays, Artificial Intelligence have forever made productivity improvement inroads into all sectors as they replace labour at all levels – skilled, semi-skilled and unskilled
    • Output, if measurable, is then increased per person employed, even if the labour had input no extra effort – and given there’s a direct relationship between output and revenue/ profits in the private sector, this means the potential to pay employees more is increased – hence, standards of living are improved
  • As for other national performance measures, one might well ask about other important areas which affect most people, including:
    • Waste levels and waste costs incurred by major public services such as the NHS or Police, both of which claim the need for huge increases in funding from the taxpayer
    • Labourforce and general population happiness levels – especially as we believe we’re moving from a materialism to mentalism era where wealth will no longer be measured by the tangible stuff we can afford but the intangible stuff which makes lives worth living and more satisfying
    • Labourforce skill levels versus those needed by all sectors
    • Quality of public sector outcomes e.g. in health, education and crime prevention

Over all levels, it’s a sorry picture

Most people ignore or don’t fully understand their current performance position – where they are now – before charging off in some direction and/ or with some new idea/ management fad in order to reach some undefined target

This is not ‘creative destruction’ at work – just plain ignorance

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