Eight to Late

Introduction

Over the last two decades or so, it has been recognized that creativity and innovation tend to thrive in organisations  where employees have a say in decisions that affect their work.  This has lead to the notion of a post-bureaucratic organisation –  an organisation in which decisions are made collectively through dialogue and consensus, and where  the hierarchy is flat.  Although a number of workgroups within large organizations function this way (and with some success too),  a post-bureaucratic organisation is generally seen as a utopian and academic ideal; one that is  unlikely to work in the real world. Those who manage  organizations, departments or workgroups  are generally uncomfortable with employees working autonomously,  even though this might lead to the generation of novel ideas and products.  This is understandable: it is ultimately the responsibility of managers to ensure that  organisational or departmental goals are achieved. How else to do this but through the time-tested command and control approach to management?

In response to the question posed above, project management is often touted as a means to manage creative and innovative efforts in organisations (see some of the articles in this issue of PM Network, for example).  The claim seems a reasonable one: project management (by definition) provides a means to manage  collective, goal oriented endeavours. Further, many projects – especially those involving  new product or software development – have a creative/innovative component. In practice, though, project management tends to be a bureaucratic affair;  involving plans that must be followed, schedules that must be adhered to and regular progress reports that must be made. Even so (or perhaps, because this is so) many organizations see project management as a means to manage all creative work in a post-bureaucratic setting.  Implicit in this view is the assumption that the implementation of project management processes will  enable managers to control and direct creative work without any adverse side-effects.  An article by Damian Hodgson entitled Project Work: The Legacy of Bureaucratic Control in the Post-Bureaucratic Organisation, explores the tensions and contradictions presented by this notion. Although the article was written a while ago (in 2003), I believe the ideas explored in it are ever more relevant today, particularly in view of the increasing projectisation of organisations and the work carried out within them.  Hence my motivation to  summarise and review  the paper.

Background – setting the stage

To be fair, many organizations recognise that a “light hand on the rudder” is needed in order to encourage creativity and innovation.  In these organisations, project management is often seen as a means to achieve this.  But  how well does it work in practice? Hodgson’s paper aims to provide some insight into this question via a case study of an organization in which a project-based form of management was implemented as a means to balance the  requirements of creativity and control. In his words:

In response to the challenges of the post-bureaucratic form, project management has  been put forward by many as a ‘tried-and-tested’ package of techniques able to cope with discontinuous work, expert labour and continuous and unpredictable change while delivering the levels of reliability and control of the traditional bureaucracy. In this article I explore some of the contradictions and tensions within a department where such a ‘hybrid’ mode of control is implemented, embodying both bureaucratic and post-bureaucratic logics. In particular, I focus upon the discursive tactics employed to sell ‘rebureaucratization’ as ‘debureaucratization’, and the complex employee responses to this initiative. I argue that the tensions evident here cast significant doubt on the feasibility of a seamless integration of bureaucracy and the post-bureaucratic [organization].

The “discursive tactics” that Hodgson mentions to are (seemingly reasonable and rational) arguments that an organization might use to “sell” the idea that the methods and approaches of project management are consistent with the ideals of a post-bureaucratic organization. An example of such an argument goes as follows: project management is routinely used to manage new product development projects, so it is eminently suited to managing creative work (Incidentally,  this isn’t quite right – see this paper review for more on why)

Post bureaucracy vs. bureaucracy

Before moving on, it is worth comparing the characteristics of bureaucratic and post-bureaucratic organizations. Hodgson provides the following comparison, drawn from Hekscher’s work:

Bureacracy	Post-bureaucracy
Consensus through Acquiescence to Authority	Consensus through Institutionalized Dialogue
Influence based on Formal Position	Influence through Persuasion/PersonalQualities
Internal Trust Immaterial	High Need for Internal Trust
Emphasis on Rules and Regulations	Emphasis on Organizational Mission
Information Monopolised at Top of Hierarchy	Strategic Information shared in Organization
Focus on Rules for Conduct	Focus on Principles Guiding Action
Fixed (and Clear) Decision Making Processes	Fluid/Flexible Decision Making Processes
Network of Specialized FunctionalRelationships	Communal Spirit/Friendship Groupings
Hierarchical Appraisal	Open and Visible Peer Review Processes
Definite and Impermeable Boundaries	Open and Permeable Boundaries
Objective Rules to ensure Equity of Treatment	Broad Public Standards of Performance
Expectation of Constancy	Expectation of Change

The aim of the case study is to highlight some of the inconsistencies and contradictions that result from applying a bureaucratic mechanism (project management) to manage the work of a group that was very good at doing creative work, but was used to a more free-wheeling, hands-off management style (i.e. a group which approximates the idealised post-bureaucratic environment described above).

Why project management?

Project management has its roots in classical management (ala Taylor and Fayol), so it is perhaps  surprising that it is considered as a means to manage work in a post-bureaucratic setting. In Hodgson’s words:

I would argue that what distinguishes project management as of particular relevance to 21stcentury organizations is its rediscovery of a very 19th-century preoccupation with comprehensive planning, linked to a belief in the necessity of tight managerial discipline.

Project management tools and techniques support managerial discipline by providing means to decompose the project into manageable bits – by using a WBS say – and then assigning these bits to individuals (or small teams). The work assigned can then be tracked and controlled tightly – which is a good thing.  If the matter rested there it wouldn’t be too bad, but very often management also prescibes how the work should be done. This level of control results in a loss of autonomy (and motivation)  for team members whose job it is to do the work. The loss of motivation can have negative effects, especially in projects with a large creative component.  To counter this criticism, in recent years project management has started to focus on the creative aspects of projects – what’s needed to motivate teams, how to foster creativity (in new product development work, say) etc. As Hodgson puts it,

The linking of project management and change management has increased project management’s influence across industries, such that now the largest professional organization in project management includes special interest groups in areas as diverse as healthcare, retail, media, marketing, and hospitality. As a consequence the last decade has been a time of particularly rapid expansion for project management, as issues of change, knowledge management, and constant innovation emerged as central themes in popular management discourse.

So, project management offers two (seemingly contradictory) benefits: the ability to maintain tight control of work and the ability to foster innovation and creativity:

…project management can be seen as an essentially bureaucratic system of control, based on the principles of visibility, predictability and accountability, and operationalized through the adherence to formalized procedure and constant written reporting mechanisms. At the same time, however, project management draws upon the rhetoric of empowerment, autonomy and self-reliance central… In principle, then, project management offers a system which attempts to integrate bureaucratic control and a form of responsible autonomy more in keeping with the interdisciplinary, knowledge-intensive nature of much project work in teams.

Seen in this light, it is perhaps not so surprising that project management is viewed as a means to manage creative work.

The case study

With the above background done, I now move on to a discussion of the case study.  In Hodgson’s words, the study:

…focused upon  a telephone bank in northern England which I have referred to under the pseudonym Buzzbank. In the late 1980s, Buzzbank had been set up by a major UK bank, which I will call TN Banking, and represented one of several success stories in the retail banking sector over this period. Through reduced overheads and the extensive use of new technology in the form of sophisticated marketing techniques and call-centre technology, Buzzbank had expanded rapidly in terms of market share and turnover, developing into a key component of TN Banking’s global operations. My interest in particular centred on Buzzbank senior management’s identification of project management as the prime ‘critical success factor’ for the organization; the development of project management expertise throughout the organization was seen as a key priority to maintain performance into the next decade. To an extent, the project teams researched could scarcely be more ‘cutting edge’, representing highly-trained ‘knowledge workers’ developing innovative high technology applications and solutions in a new sector of an enormously profitable industry

Hodgson conducted interviews and observed operations within the IT department of Buzzbank over a period of two years. During this period, the organization was implementing a “strategic plan” aimed at formalizing innovation and creative work using project management processes. The idea, in the words of a couple of senior IT managers was to “bring a level of discipline” and “bring an idea of professional structuring” to the work of the highly successful unit. The structuring and discipline was to be achieved by implementing project management processes.

The main rationale used to sell project management to the Buzzbank IT team is a familiar one: the need to ensure predictability and repeatability of work done whilst ensuring that innovation and creativity would not be impeded. Another justification offered by management was that the size of the organization (which had grown considerably in the years prior to the implementation of the strategic plan) meant that  the existing “ad-hoc” work culture would no longer be successful. That is,  the size of the organization necessitated a degree of formalization,  ergo bureaucratic procedures had to be put in place. This was rationalised  (by senior management) as a natural and inevitable consequence of growth:

…The organization was therefore portrayed by senior management in IT as approaching its ‘next stage of evolution’. The immediate benefit of such a metaphor for those members of senior management charged with rebureaucratizing the organization is that it carries a very strong sense of inevitability. As such, it casts opposition to such changes as irrational and futile, standing in the way of natural ‘evolution’.

Further, managers in the organization dubbed any employee resistance as “natural growing pains” – like those of an adolescent, say. Cast in this light, dissenting viewpoints were portrayed as natural and unavoidable – and possibly even necessary – but ultimately without any validity.

Another interesting aspect that Hodgson highlights is the way in which old practices (the successful but “bad” ones) were subsumed in the new (formal) framework. For example, in the old world, employees were given the freedom to experiment, and many considered this as a strength not a weakness. In the new world, however, such a practice was seen as a threat; it was considered more important to capture how to do things correctly so that things became repeatable (ala best practice) and experimentation would not be necessary. As one manager put it:

If we capture how we do things right, at least it makes things repeatable, and we can record the improvement required when things don’t go right, which doesn’t happen in a rapidly-expanding, gung-ho environment.

Hodgson notes that the terms rapidly-expanding and gung-ho, which are used in a negative sense, could just as well be cast in positive terms such as  flexible, proactive etc. The point being that management framed the existing situation in terms that made the implementation of the new procedures seem like a logical and reasonable next step. The processes were touted as a means to achieve change (i.e. be flexible), but in a controlled way. So, management went to great lengths to avoid use of terms that would be perceived as being negative – for example, the term “structure” was used instead of “bureaucracy” or “formalization.” In this way, management attempted to assimilate the existing values of Buzzbank into the strategic plan.

So, how well did it work? Here’s what Hodgson says about the end result:

The impression given [by senior management] was that of an organizational change which was inevitable, which gave rise to some understandable but irrational resistance, and which had now been effectively completed, for the good of the organization as a whole.

On the other hand, the impression Hodgson got from speaking to lower level employees was very different:

However, in the time spent by myself in the organization, the tone and target of much of the humour, as well as much stronger reactions, appeared to throw doubt on the extent to which this discourse had permeated among the general employees, particularly within the IT department. Humour was commonplace in the everyday banter both within teams and between teams in the IT division at Buzzbank, and the increasing levels of bureaucratization was the butt of most of the humour, particularly at the lower levels of the hierarchy. The main experience of project management as reported by many  Buzzbank employees was one of intensified bureaucratic surveillance…

A key example is the reaction of employees to managerial jargon that was used in company circulars and literature intended to promote the strategic plan.

Typically, comments were provoked by the circulation of literature on the strategic plan, and again, excerpts of the document were read out by members of staff, adding ironic comments to underline the gap between the document and their experience of life and work in the department.

Hodgson notes that employees often appeared to comply with the new regulations, but not in the way intended by management:

At other times, the employees appeared to comply with the formal requirements of the new system, in terms of filling in the necessary forms, reporting in at given times, completing the necessary work-logs and so on. Even here, despite the relative sophistication of senior management’s re-articulation of key discourses, compliance on the part of Buzzbank employees in many cases bore all the hallmarks of instrumental behaviour, accompanied by insubordinate statements and humour ranging from the cynical to the confrontational. At other times, assurances were given to senior management and immediately contravened, fictionalized accounts of project activities were submitted late, or else procedures were observed meticulously to the detriment of deadlines and other constraints. The emergent organizational order was a precarious negotiation between alienated compliance and an autonomous disregard for bureaucratic demands…

In short: there was a clear gap between the perceptions of management and employees as to the success of the newly implemented processes.

It is clear that Buzzbank managers saw  project management as  a means to control and direct creative / innovative work in a way that would have no negative effect on employee morale and motivation.   The challenge, of course, lay in achieving employee buy-in.  Management used many creative (!) tactics to “sell” project management to staff. These included:

1. References to a “natural process of evolution” and the consequent “growing pains” that the organization would experience. This made the pain of the change natural and inevitable, but necessary in the interest of future gain.
2. Manipulation of terminology to make the changes seem more palatable – e.g. using the word “structure” instead of “formalization” or “bureaucracy”.
3. Co-opting terminology of post-bureaucratic organizations into literature designed to promote the new structure. For example, claiming that project management processes would enable the organization to be even more responsive to change (i.e. flexible), through change management processes.

From employees’ perspective, such techniques were plainly seen for what they were: methods to “sell the unsellable”. The negative reactions of employees were manifested through sarcastic humour and (often minor) acts of insubordination. The case study thus highlights the difficulties in using project management as a means to control work in a post-bureaucratic work environment.

Wrapping-up: reflections and summary

Hodgson sees the case study as exemplifying the problem of control vs. autonomy in emerging post-bureaucratic organizations:  managers view project management as a means to address the risks inherent in post-bureaucratic work, whereas employees view it as a unnecessary and unjustified imposition. Management was looking for the “best of both worlds”, a hybrid model that incorporated the best elements of a post bureaucratic model and a traditional command and control approach. The case study casts doubt on whether such a hybrid is possible solely through the implementation standard project management techniques and processes. It does so by exposing some of the tensions and differences in perceptions that can occur when such a model is implemented.

So where does this leave managers? Is there a way to manage creative work without destroying employee morale and motivation?

Looking over the complaints of the Buzzbank employees, it is clear that most of the problems arose from the loss of autonomy that they had enjoyed prior to the implementation of the new processes. This being the case, any measure to increase autonomy should improve the situation. A couple of possibilities come to mind – both of which I have discussed in earlier pieces. These are:

1. Empower employees to make decisions that affect their work. This means allowing them the freedom to decide the best approach to solving problems (within limits specified by organisational and resource constraints).
2. In situations where (1) isn’t possible, one could use collaborative techniques such as dialogue mapping to achieve employee buy-in. Of course, management has to be prepared to engage in true dialogue, and be willing to act upon (reasonable) suggestions made by employees.

The key message is simple and obvious: the more of say employees have in making work-related decisions, the more engaged and motivated they’ll be. This is not just a warm and fuzzy notion, but one that is backed up by research on motivation (see this paper review, for example). Yes, this does mean letting go of the “reins of control” to an extent but it is clear, as highlighted by Hodgson’s work, that holding the reins tightly might cause more problems that it solves. What’s called for, above all, is a degree of flexibility:  use project management processes by all means, but be open to employee input as to what’s working well and what’s not.

To sum up:  Hodgson’s case study suggests that inflexible project management based approaches to managing creative work  may not work as well as advertised by purveyors of frameworks and methodologies. As an alternative,  it might be worth taking a step towards the utopian ideal of a post-bureaucratic organisation  by using techniques that encourage employee input in organisational decision making.

Introduction 

Risk management is fundamentally about making decisions in the face of uncertainty. These decisions  are based on perceptions of future events,  supplemented by analyses of data relating to those events.  As such, these decisions  are subject to cognitive biases -  human tendencies to base judgements on flawed perceptions of events and/or data. In an earlier post,  I argued that cognitive biases are meta-risks,  i.e.  risks of  risk analysis.   An awareness of how these biases operate can pave the way towards reducing their effects on risk-related decisions. In this post I therefore look into the nature of cognitive biases. In particular:

1. The role of intuition and rational thought in the expression of cognitive biases.
2. The psychological process of attribute substitution which underlies judgement-related cognitive biases

I  then take a brief look at ways in which the effect of  bias in decision-making can be reduced. 

 The role of intuition and rational thought in the expression of cognitive biases

Research in psychology has established that human cognition works through two distinct processes:   System 1 which corresponds to intuitive thought and System 2 which corresponds to rational thought. In his Nobel Prize lecture, Daniel Kahneman had this to say about the two systems:

The operations of System 1 are fast, automatic, effortless, associative, and often emotionally charged; they are also governed by habit, and are therefore difficult to control or modify. The operations of System 2 are slower, serial, effortful, and deliberately controlled; they are also relatively flexible and potentially rule-governed.

 The surprise is that judgements always involve System 2 processes. In Kahneman’s words:

 …the perceptual system and the intuitive operations of System 1 generate impressions of the attributes of objects of perception and thought. These impressions are not voluntary and need not be verbally explicit. In contrast, judgments are always explicit and intentional, whether or not they are overtly expressed. Thus, System 2 is involved in all judgments, whether they originate in impressions or in deliberate reasoning.

 So, all judgements, whether intuitive or rational, are monitored by System 2. Kahneman suggests that this monitoring can be very cursory thus allowing System 1 impressions to be expressed directly, whether they are right or not. Seen in this light, cognitive biases are unedited (or at best lightly edited) expressions  of  often incorrect impressions.

 Attribute substitution: a common mechanism for judgement-related biases

 In a paper entitled Representativeness Revisited,  Kahneman and Fredrick suggest that the psychological process of attribute substitution  is the mechanism that underlies many cognitive biases.  Attribute substitution is the tendency of people to answer a difficult decision-making question by interpreting it as a simpler (but related) one. In their paper, Kahneman and Fredrick describe attribute substitution as occurring when:

 …an individual assesses a specified target attribute of a judgment object by substituting a related heuristic attribute that comes more readily to mind…

 An example might help decode this somewhat academic description.  I pick one from Kahneman’s Edge master class where he related the following:

 When I was living in Canada, we asked people how much money they would be willing to pay to clean lakes from acid rain in the Halliburton region of Ontario, which is a small region of Ontario. We asked other people how much they would be willing to pay to clean lakes in all of Ontario.

People are willing to pay the same amount for the two quantities because they are paying to participate in the activity of cleaning a lake, or of cleaning lakes. How many lakes there are to clean is not their problem. This is a mechanism I think people should be familiar with. The idea that when you’re asked a question, you don’t answer that question, you answer another question that comes more readily to mind. That question is typically simpler; it’s associated, it’s not random; and then you map the answer to that other question onto whatever scale there is—it could be a scale of centimeters, or it could be a scale of pain, or it could be a scale of dollars, but you can recognize what is going on by looking at the variation in these variables. I could give you a lot of examples because one of the major tricks of the trade is understanding this attribute substitution business. How people answer questions.

 Attribute substitution boils down to making judgements based on specific, known instances of events or issues under consideration. For example,  people often overrate their own abilities because they base their self-assessments on specific instances where they did well, ignoring situations in which their performance was below par.  Taking another example from the Edge class,

 COMMENT: So for example in the Save the Children—types of programs, they focus you on the individual.

 KAHNEMAN: Absolutely. There is even research showing that when you show pictures of ten children, it is less effective than when you show the picture of a single child. When you describe their stories, the single instance is more emotional than the several instances and it translates into the size of contributions.  People are almost completely insensitive to amount in system one. Once you involve system two and systematic thinking, then they’ll act differently. But emotionally we are geared to respond to images and to instances…

 Kahnemann sums it up in a line in his Nobel lecture: The essence of attribute substitution is that respondents offer a reasonable answer to a question that they have not been asked.

Several decision-making biases in risk analysis operate via attribute substitution -  some of these include availability, representativeness, overconfidence and selective perception (see this post for specific examples drawn from high-profile failed projects).  Armed with this understanding of how these meta-risks operate, lets look at how their effect can be minimised.

 System two to the rescue, but…

 The discussion of the previous section suggests that people often base judgements on specific instances that come to mind, ignoring the range of all possible instances. They do this because specific instances – usually concrete instances that have been experienced – come to mind more easily than the abstract “universe of possibilities.” 

Those who make erroneous judgements will correct them only if they become aware of factors that they did not take into account when making the judgement, or when they realise that their conclusions are not logical. This can only happen through deliberation:   rational analysis,  which is possible only through a deliberate invocation of System 2 thinking.

 Some of the ways in which System 2 can be helped along are: 

1. By reframing the question or issue in terms that forces analysts to consider the range of possible instances rather than specific instances.  A common manifestation of the latter is when risk managers base their plans on the assumption that average conditions will occur – an assumption that Professor Sam Savage calls the flaw of averages (see Dr. Savage’s very entertaining and informative book for more on the flaw of averages and related statistical fallacies).
2. By requiring analysts to come up with pros and cons for any decision they make. This forces them to consider possibilities they may not have taken into account when making the original decision.
3. By basing decisions on relevant empirical or historical data instead of relying on intuitive impressions.
4. By making the analysts aware of their  propensity to be overconfident (or under-confident) by evaluating their probability calibration. One way to do this is by asking them  to answer a series of trivia questions with confidence estimates for each of their answers (i.e. their self-estimated probability of being right). Their confidence estimates are then compared to the fraction of questions correctly answered. A well calibrated individual’s confidence estimates should be close to the percentage of correct answers.  There is some evidence to suggest that analysts can be trained improve their calibration through cycles of testing and feedback.  Calibration training is discussed in Douglas Hubbard’s book, The Failure of Risk Management. However, as discussed here, improved calibration by through feedback and repeated tests may not carry over to judgements in real-life situations.

Each of the above options forces  analysts to consider instances other than the ones that readily come to mind.  That said, they aren’t a sure-cure for the problem:  System 2 thinking does not guarantee correctness.  Kahneman discusses several reasons why this is so.  First, it has been found that education and training in decision-related disciplines (like statistics) does not eliminate incorrect intuitions; it only reduces them in favourable circumstances (such as when the question is reframed to make statistical cues obvious). Second, he  notes that sytem 2 thinking is easily derailed: research has shown that the efficiency of system 2 is impaired by time pressure and multi-tasking. (Managers who put their teams under time and multi-tasking pressures should take note!). Third, highly accessible values, which form the basis for initial intuitive judgements serve as anchors for subsequent system 2-based corrections. These corrections are generally insufficient – i.e. too small.  And finally, System 2 thinking is of no use if it is based on incorrect assumptions:  as a colleague once said, “Logic doesn’t get you anywhere if  your premise is wrong.” 

Conclusion

 Cognitive biases are meta-risks that are  responsible for many incorrect judgements in project (or any other) risk analysis . An apposite example is the financial crisis of 2008, which can be traced back to several biases such as groupthink, selective perception and over-optimism (among many others). An understanding of how these meta-risks operate suggest ways in which their effects can be reduced,  though not eliminated altogether.  In the end,  the message is simple and obvious: for judgements that matter, there’s no substitute for  due diligence -  careful observation and thought, seasoned with an awareness of one’s own  fallibility.

Organisational culture is defined by the values and norms that are shared by people and groups in an organisation. These values and norms, in turn, influence how  people interact with each other and with outsiders. That’s well and good, but how does one determine an an organisation’s culture? How does one find out if the culture good (i.e. would one like to work there) or bad (would one not)? In my opinion, this is best evaluated by looking at how people react in certain work situations.  What follows is a quick quiz to test an organisation’s culture based on this principle.  Note that it can also be applied to projects – as projects are temporary organisations. Typically project and team cultures simply reflect those of the organisations in which they exist. However, there can be differences: a good project or team leader can (to an extent) shield his or her team from the effects of a toxic organisational culture. But that’s fodder for another post.  For now, let’s get on with the quiz.

A tip before starting: don’t over-think your answers; your initial response is probably the most accurate one.

Ready? Right, here we go…the sixty-second quiz on your workplace culture:

a)  You make a mistake that no one notices. What do you do:

1. Keep quiet about it and hopes it remains unnoticed.
2. Own up because it is OK to make mistakes around here.
3. Dream up a scheme to pin it someone else, preferably a rival for a promotion.

b)  You have an idea that might lead to a new product. You

1. Use workmates and manager as a sounding board for whether it is any good.
2. Start to work it through yourself to see if it is any good. 
3. Forget about it

c) You have an idea which involves collaborating with someone from another department. You

1. Approach the person directly.
2. Go through the proper channels – approach your manager who approaches their manager and so on.
3. Forget about it: inter-departmental politics would get in the way.

d) People at an organisation-wide event (company day or a project team day out, for example):

1. Stick with folks from their departments. 
2. Mingle, and look like they’re enjoying it. 
3. Look like they want to be elsewhere. In fact many of them are – they’ve called in sick.

e) A project has gone horribly wrong. Do people

1. Look for a scapegoat. 
2.  Say, “I had nothing to do with it.” 
3. Work together to fix it.

f)  Someone from another department approaches you for assistance relating to your area of expertise. Do you

1. Help them right away, or as soon as you can. 
2. Ask them to speak to your manager first. 
3. Fob them off – you’re way too overworked and don’t really feel like doing a whit of work more than you absolutely have to.

g)  What do people in your organisation do when they are annoyed by some aspect of their job? (Note: see this post for more on this question)

1. They complain about it. 
2. They ignore it.
3. They fix it.

h) The atmosphere in cross-departmental meetings in your organisation is generally:

1.  Cordial.
2. Tense 
3. Neutral

i) An impossible deadline looms. In order to meet it you

1. Work overtime because you have to. 
2. Work overtime because you want to. 
3. This question is inapplicable – you never have impossible deadlines.

j)  You’ve done something brilliant that saves the organisation a packet. Your manager:

1. Acknowledges your efforts publicly. 
2. Acknowledges your efforts privately. 
3. Grabs the glory.

k) You’ve worked overtime on a project and its all come good. You get 

1. A pat on the back. 
2. A pat on the back and something tangible (a bonus, a meal or at least a movie voucher) 
3.  Nothing (We pay you a salary, don’t we?)

l)  You’re feeling under the weather, but are not really sick (Put it this way: no doctor would give you a certificate). However, you honestly don’t think you can make it through the work day.  What do you do?

1. Thank God and take the day off.
2. Go to work because you want to. 
3. Go to work because you have to.

Score:

The score for each response is the number  in brackets against the choice you made.

a. 1 (5)  2(10)  3(0)
b. 1(10) 2(5) 3(0)
c. 1(10) 2(5) 3(0)
d. 1(5) 2(10) 3(0)
e. 1(0) 2(5) 3(10)
f.  1(10) 2(5) 3(0)
g. 1(0) 2(5) 3(10)
h. 1(10) 2(0) 3(5)
i.  1(0) 2(5) 3(10)
j.  1(10) 2(5) 3(0)
k. 1(5) 2(10) 3(0)
l.  1(0) 2(10) 3(5)

What does your score mean?

> 100 :  Does your organisation have any vacancies for a PM/dev manager? 

80-95 :  I bet you enjoy working here.

60-75: Still on the right side of the divide, but things do get unpleasant occasionally

40 -55: Things could be a lot worse – but, they could also be better.

20-35: Things are a lot worse

< 20: Workplace hell?

A good organisational culture is one which encourages and enables people to do the right thing  without coercion or fear of consequences.  What’s right?  Most people just know what is right and what’s not, without having to be told.   I can think of no better way to end this post than by quoting from the start of Robert Pirsig’s classic,  Zen and The Art of Motorcycle Maintenance:

And what is good, Phædrus,
And what is not good…
Need we ask anyone to tell us these things?

Many organisations measure  performance – of people, projects processes or whatever - using  quantitative metrics, or KPIs as they are often called.  Some examples of these include: calls answered / hour (for a person working in a contact centre); % complete (for a project task) and  orders processed / hour (for an order handling process). The rationale for measuring performance quantitatively is rooted in Taylorism or scientific management. The early successes of Taylorism in improving efficiencies on the shopfloor lead to its adoption in other areas of management. The scientific approach to management underlies the assumption that metrics are a Good Thing,  echoing the words of the 19th century master physicist, Lord Kelvin:

When you can measure what you are speaking about, and express it in numbers, you know something about it; but when you cannot measure it, when you cannot express it in numbers, your knowledge of it is of a meager and unsatisfactory kind; it may be the beginning of knowledge, but you have scarcely, in your thoughts, advanced it to the stage of science.

This is a fine sentiment for science: precise measurement is a keystone of physics and other natural sciences. So much so, that some scientists spend a large part of their professional lives refining and perfecting certain measurements. However, it can be misleading and sometimes downright counterproductive to attempt such quantification in management.  This post explains  why I think so.

Firstly, there are basically two categories of things (indicators, characteristics or whatever) that management attempts to quantify when defining performance metrics– tangible (such as number of calls per unit time) and intangible (for example, employee performance on a five point scale). Although people attach numerical scores to both kinds of things, I’m sure most people would agree that any quantification of employee performance is way more subjective than number of calls per unit time. Now, it is possible to reduce this subjectivity by associating the intangible characteristic to a tangible one – for example, employee performance can be tied to sales (for a sales rep), r number of projects successfully completed (for a project manager) or customer satisfaction as measured by surveys (for a customer service representative).  However, all such attempts result in a limited view of the characteristic being measured.  Such associated tangible metrics cannot measure all aspects of the intangible metric in question. In the case at hand – employee performance -   factors such as enthusiasm, motivation, doing things beyond the call of duty etc., all of which are important aspects of employee performance, remain unmeasurable. So as a first point we have the following: attaching a numerical score to intangible quantities is fraught with subjectivity and ambiguity.

But even measures of tangible characteristics can have issues. An example that comes to mind is the infamous % complete metric for tasks in a project management. Many project managers record a progress by noting that a task – say data migration – is 70% complete. But, what does this figure mean? Does it mean that 70% of the data has been migrated (and what does that mean anyway?), or is it that 70% of the total effort required (as measured against days allocated to the task) has been expended. Most often, the figure quoted has no explanation as to what it means – and everyone interprets it in a way that best suits their agenda. My point here is: a well designed metric should include an unambiguous statement as to what is being measured,  how it is to be measured and how it is to be interpreted. Many seemingly well defined metrics do not satisfy this criterion – the % complete metric being a sterling example. These give the illusion of precision, which can be more harmful than having no measurement at all. My second point is thus summarised as follows: it is hard to design unambiguous metrics, even for tangible performance characteristics. Of course, speaking of the % complete metric, many project managers now understand its shortcomings and use an “all or nothing” approach – a task is either 0% complete (not started or in progress) or 100% complete (truly complete).

Another danger of quantification of performance is highlighted by Eliyahu Goldratt in his book The Haystack Syndrome. To quote from the book:

…Tell me how you measure me and I will tell you how I will behave. If you measure me in an illogical way…do not complain about illogical behaviour…

A case in point is the customer contact centre employee who is measured by calls handled per hour. The employee knows he has to maximise calls taken, so he ends up trying to keep conversations short – even if it means upsetting customers. By trying to improve call throughput, the company ends up reducing quality of service. Fortunately, some service companies are beginning to understand this – read about Repco’s experience in this article from MIS Australia, for example. The take-home point here is: performance measurements that focus on the wrong metric have the potential to distort employee behaviour to the detriment of  the organisation.

Finally, metrics that rely on human judgements are subject to cognitive bias. Specifically, it is well known that biases such as anchoring and framing can play a big role in determining the response received to a question such as, “How would you rate X’s performance on a scale of 1 to 5 (best performance being 5)?” In earlier posts, I’ve written about the role of cognitive biases in project task estimation and project management research. The effect of these biases on performance metrics can be summarised as follows: since many performance metrics rely on subjective judgements made by humans, these metrics are subject to cognitive biases. It is difficult, if not impossible, to correct for these biases.

To conclude: it is difficult to design performance metrics that are unambiguous, unbiased and do not distort behaviour. Use them if you must – or are required to do so by your organisation – but design and interpret them with care because, if used unthinkingly, they can cause terminal damage to employee morale.

Note: Despite references to this sorry saga, the author affirms that this is a work of fiction.

Good morning, Mr. CEO Sir,
we offer services complete.
We’ll take care of your computers,
and fudge your balance sheet.

We’ll overstate your revenue,
and inflate profits.
Thus boosting your share value
in global stock markets.

We’ll find you well-known auditors
to sign off your accounts.
A thumbs-up from their managers
will put to rest all doubts.

Soon you’ll get rewards for sure,
despite such malfeasance.
Trophies and awards galore
for corporate governance.

I trust our varied expertise
gives you confidence.
We’ll take good care of your IT
…and your finances.