My Pispective on Managing by the Numbers

management Metrics

(A pispective is when you write about something with only 314 words. Which doesn't include these. Or the credits at the bottom)

Good decisions don't come easily. That is, effective decision making isn't something that just happens. And we all like to think we make effective decisions. But the sad truth is that too few of us do.

The thing is, for many people and many organizations, decisions are often automatic. They're made without people asking questions. Or rather, the questions we do ask are separate from the decisions made.

This is because we've lost sight of what measurement is. The world of business can be a rote world. We might think we're in charge of things but often the reverse is true. Things are in charge of us. And the things most in charge are the metrics we put in put in place.

Or to be more specific, the metrics that other people put in place before we arrived. Organizations are run by the numbers. Not in the sense of the phrase, 'by the numbers', which is about doing something exactly. I mean in the sense that it's the metrics that rule behavior.

Many management professionals have realised that a large swathe of the metrics we use to manage aren't that applicable to what we do. ROI for instance. It crept into the business world in the 1920's with Alfred Sloan at GM.

It became popular because it was an improvement on what came before. It then spread. But it spread too far. It was a nice way of looking at the world. It made sense in one domain, why not another? Reasonable reasoning, but context is king.

ROI is getting rolled back in domains where it doesn't support effective decision making. Other metrics are being suggested in its place. But starting with the metric puts the cart before the horse. We must start with the decision. Because the metric shapes the decision.

A metric is just a frame. It makes the decision for us.

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