Sir! Easy Company is All Present!


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Trap 1: Measuring Against Yourself

You have to be creative about how you find the relevant data or some proxy for them. One way is to ask your customers.


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Each branch of the company telephones a random sample of customers and asks whether they will use Enterprise again. When the index goes up, the company is gaining market share; when it falls, customers are taking their business elsewhere. The branches post results within two weeks, put them next to profitability numbers on monthly financial statements, and factor them into criteria for promotion thus aligning sales goals and incentives.

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Either approach can be irritating. If people dining together in one of his restaurants are looking at one another, the service is probably working. Another way to get data is to go to professionals outside your company. When Marc Effron, the vice president of talent management for Avon Products, was trying to determine whether his company was doing a good job of finding and developing managers, he came up with the idea of creating a network of talent management professionals.

What you will receive with your plot

Started in , the New Talent Management Network has more than 1, members, for whom it conducts original research and provides a library of resources and best practices. Along with budget figures, your performance assessment package almost certainly includes comparisons between this year and last.

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If so, watch out for the second trap, which is to focus on the past. Look for measures that lead rather than lag the profits in your business. The U. If it can get more customers into early or even preemptive treatment than other companies can, it will outperform rivals in the future.

The quality of managerial decision making is another leading indicator of success. Kaufman, HBR October It may sound trite, but how the company presents itself in official communications often signals the management style of top executives. Good management is about making choices, so a decision not to do something should be analyzed as closely as a decision to do something. At one investment bank, if the deals that managers have rejected turn out to be lemons, those rejections count as successes. Good or bad, the metrics in your performance assessment package all come as numbers.

The problem is that numbers-driven managers often end up producing reams of low-quality data. Think about how companies collect feedback on service from their customers. Yet out of a desire to gather as much information as possible at points of contact, companies routinely ask customers to include personal data, and in many cases the employees who provided the service watch them fill out the forms.

How surprised should you be if your employees hand in consistently favorable forms that they themselves collected? Bad assessments have a tendency to mysteriously disappear. Numbers-driven companies also gravitate toward the most popular measures. The question of what measure is the right one gets lost. Similar issues arise about the much touted link between employee satisfaction and profitability.

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The Employee-Customer-Profit Chain pioneered by Sears suggests that more-satisfied employees produce more-satisfied customers, who in turn deliver higher profits. Or they may actually enjoy what they do, but their customers value price above the quality of service think budget airlines. A particular bugbear of mine is the application of financial metrics to nonfinancial activities. Anxious to justify themselves rather than be outsourced, many service functions such as IT, HR, and legal try to devise a return on investment number to help their cause. Indeed, ROI is often described as the holy grail of measurement—a revealing metaphor, with its implication of an almost certainly doomed search.

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Typically, he or she would ask program participants to identify a benefit, assign a dollar value to it, and estimate the probability that the benefit came from the program. Think about this for a minute. How on earth can the presumed causal link be justified?

Assessing any serious executive program requires a much more sophisticated and qualitative approach. Once the program has ended, you have to look beyond immediate evaluations to at least six months after participants return to the workplace; their personal feedback should be incorporated in the next annual company performance review.

What you will receive with your plot

The moment you choose to manage by a metric, you invite your managers to manipulate it. Metrics are only proxies for performance. Someone who has learned how to optimize a metric without actually having to perform will often do just that.

To create an effective performance measurement system, you have to work with that fact rather than resort to wishful thinking and denial. Clifford Chance replaced its single metric of billable hours with seven criteria on which to base bonuses: respect and mentoring, quality of work, excellence in client service, integrity, contribution to the community, commitment to diversity, and contribution to the firm as an institution. Metrics should have varying sources colleagues, bosses, customers and time frames. Horizon 1 covered actions relevant to extending and defending core businesses, and metrics were based on current income and cash flow statements.

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Horizon 2 covered actions taken to build emerging businesses; metrics came from sales and marketing numbers. Horizon 3 covered creating opportunities for new businesses; success was measured through the attainment of preestablished milestones. Multiple levels like those make gaming far more complicated and far less likely to succeed.

You can also vary the boundaries of your measurement, by defining responsibility more narrowly or by broadening it. To reduce delays in gate-closing time, Southwest Airlines, which had traditionally applied a metric only to gate agents, extended it to include the whole ground team—ticketing staff, gate staff, and loaders—so that everyone had an incentive to cooperate.

Finally, you should loosen the link between meeting budgets and performance; far too many bonuses are awarded on that basis. I wanted to build right from the bottom. That was in order to create fluency and a continuity of supply to the first team. With this approach, the players all grow up together, producing a bond that, in turn, creates a spirit. When I arrived, only one player on the first team was under Can you imagine that, for a club like Manchester United? So I had the confidence and conviction that if United was going to mean anything again, rebuilding the youth structure was crucial.

You could say it was brave, but fortune favors the brave. So they bring experienced players in. Winning a game is only a short-term gain—you can lose the next game. Building a club brings stability and consistency.


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  8. The young players really became the spirit of the club. I always take great pride in seeing younger players develop. The job of a manager, like that of a teacher, is to inspire people to be better. Give them better technical skills, make them winners, make them better people, and they can go anywhere in life.

    When you give young people a chance, you not only create a longer life span for the team, you also create loyalty. They will always remember that you were the manager who gave them their first opportunity. Once they know you are batting for them, they will accept your way. If you give young people your attention and an opportunity to succeed, it is amazing how much they will surprise you. Even in times of great success, Ferguson worked to rebuild his team.

    He is credited with assembling five distinct league-winning squads during his time at the club and continuing to win trophies all the while. Managing the talent development process inevitably involved cutting players, including loyal veterans to whom Ferguson had a personal attachment. He is strategic, rational, and systematic. In the past decade, during which Manchester United won the English league five times, the club spent less on incoming transfers than its rivals Chelsea, Manchester City, and Liverpool did.

    And because United was willing to sell players who still had good years ahead of them, it made more money from outgoing transfers than most of its rivals did—so the betting on promising talent could continue. Many of those bets were made on very young players on the cusp of superstardom.

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    Sir! Easy Company is All Present! Sir! Easy Company is All Present!
    Sir! Easy Company is All Present! Sir! Easy Company is All Present!
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    Sir! Easy Company is All Present! Sir! Easy Company is All Present!
    Sir! Easy Company is All Present! Sir! Easy Company is All Present!
    Sir! Easy Company is All Present! Sir! Easy Company is All Present!
    Sir! Easy Company is All Present! Sir! Easy Company is All Present!
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