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WHY DON'T BUSINESSES KEEP SCORE?

There are a lot of things American businesses do extremely well, but scorekeeping is not one of them.  In fact we do a terrible job in this area, and our failure to keep score more effectively is one of the principal reasons that the "human side of management" programs have not gotten any further than they have.  We say over and over again that "People are our most important asset" (I wish I had a buck for every time I've heard that bromide in the last ten years), and we forget that information is a damn close second.  Even worse, we forget that the two critical assets of people and information are linked so closely to each other that you can't manage either one well by itself.  In all the flurry of interest about "humanistic management," we often forget their connection.  We forget that, to be successful, you have to manage simultaneously and with equal effectiveness both your data and the people who make the data work.  You can't have one without the other.  Try to "treat people nice" without finding out how they're doing, and you're going to go bankrupt.  Try to process all the reams of information that a modern business generates without relating it to your people and you're going to be crunched in your own number machine.

Now, when I say that people and information have to be related, I don't mean just that you have to "gather data" on "the workers," and then make managerial decisions designed to improve their score.  I mean that everybody who affects, or is affected by, the information your company gathers has got to be made aware of that information, so he can use it to assess his own performance, and so his supervisors can work on his motivation in those areas where performance is lacking.

And I do mean everybody.  In the last chapter I spoke about how the guy who pushes the yellow button on Line B ultimately affects not just his shift's performance, but the whole P&L; picture of the company.  Well, if that's so - if everybody's behavior contributes to the final result - doesn't it make sense to give everybody in your organization some regular feedback on how they're doing, on how they're contributing (or not contributing - to the overall final score?

Of course it does.  But this is seldom done.  You can be sure that when Mary Lou Retton and Tim Daggett finished their high-bar routines in the Olympic trials, their coaches told them exactly how they'd done:  "That was an 8.6," or, "That wobble at the peak could have cost you a point."  Business "coaches" don't do this nearly enough - or precisely enough.  A line manager with a motivation and performance problem will complain that his people aren't working "well enough" or "efficiently enough," but won't give them specific, measurable data to track their progress.  That's like saying to a gymnast, "Not too bad, Mary Lou," or, "Great performance, Tim."  Without a specific score to hang your understanding on, that's a pretty useless piece of feedback.

Generally speaking, we do a much better job of record keeping and performance measurement the higher up we go in an organization.  The CEO and the highly paid bean counters that surround him get all the performance data they want - generally about the company's long-term prospects and quarter-to-quarter "scores."  But even they are relatively ignorant about the day-to-day business on the line:  about the millions of measurable tasks that make up the Big Score.

They don't know because they don't demand to know.  Somehow the nitty-gritty work of production, and overhead, and quality control, is not as exciting to them as marketing and differential investment scenarios - and so these critical elements of the final score are left to chance.

That's bad enough.  But the real bottleneck comes from the fact that the guys who are actually out there on the line don't have access to measurement of their own performance.  Neither, in many cases, do middle managers; they don't know either how they affect the Big Picture.  Nobody collects the data.  Nobody shows them a scorecard.  So they don't know how they're doing and, without knowing, how can they possibly be motivated to improve?  So when the division head screams, "We've got to do better," they have every right to respond, "Better than what?"

The reasons that are usually given for failing to let people see their own scorecards would be amusing if they didn't have such terrible results.  I can think of three that are particularly common:

1.         "It's not the workers' business."  You hear this piece of baloney all the time from managers who think of themselves as the "brains" of their outfits and who don't want to acknowledge that the "brawny" workers are critical to company success.  This is division of labor with a vengeance.  It's the attitude that everybody in an organization has a distinct and invariable sphere of operation, and that productivity is best achieved by everybody remaining in his sphere.  In the addled scenario, of course, the "management sphere" involved access to financial, performance, and other data - it involves keeping The Big Score.  The "labor sphere" doesn't involve any of that, because the "role" of the "worker" is to follow orders without wondering why.  So there's no point in posting performance results, because (a) the worker is too stupid to understand them anyway, and/or (b) if we give him that data, he might use it against us.

Of the two versions I'm mentioning here of the "not their business" argument, the "stupid worker" argument is the more common one; it explains why the sales force in many companies has access to quarterly revenue charts and the bean counters have access to cash-flow diagrams (salesmen and accountants have been to college, see, so they know how to read), and why, in the same companies, the production line worker knows nothing from month to month about how many widgets come off his line or how much scrap is typically involved in his process.  Don't burden the poor dope with statistics; he's just learned that two plus two is four.

The other version of the "not his business" argument is a little less common but more pernicious.  Nobody seems to notice that it contradicts Argument A - that if the worker is smart enough to use your data against you, then he must be smart enough to understand it.  In addition to being illogical, the idea is about as up-to-date in today's labor environment as a horse and buggy would be at Le Mans.  It's the old idea that the worker isn't really part of the organization at all, but a mere necessary evil, who will turn on management at any moment, if you give him the least provocation or ammunition.

Maybe there is a risk (to "security" or "competitive integrity") in posting weekly waste-retrieval results.  But I guarantee you that that risk is going to be more than offset by the added motivation supplied to the waste retrieval department when they're able to track, from one week to another, exactly how well they've been doing.

Failing to give workers information about their own week-to-week scores is like refusing to give feedback to a football lineman on how well he scored on a given play.  If he doesn't know how he did on that play, how is he going to improve?  Why is he even going to care about improving?  What's going to motivate him to move from Point A to Point B on any performance continuum if he doesn't even know where Point A is?

2.         "The workers won't stand for it."  The assumption that workers do not want - and in fact will actively resist - record keeping on their performance ties right in with the "stupid worker" argument, but carries it one step closer to absurdity.  This excuse for not telling people how they're doing rests on the theory that people are suspicious of having performance data posted.  Sometimes, I admit, that's true.  I've seen plenty of organizations where, when we first suggest the Recording element of the P.R.I.C.E. motivation system, it's the unions and not the management who balk.  That's only natural.  But do you know why?  Not because workers are "inherently" resistant to higher productivity, but because historically attempts to quantify and measure their production have always been linked to negative Consequences.

Think of the time-and-motion man caricature.  Is he an earnest researcher trying to make life - and livelihood - better for everybody by making the company more efficient?  Not at all.  In every portrait I've ever seen, he's a vicious company stooge whose only real interest in rooting out inefficiency is in firing as many people as possible.  The image you get of the "efficiency expert" is that he's only secondarily interested in efficiency.  He really gets rewarded by the number of people eliminated.

The stereotype wasn't born in a vacuum.  Factory workers have good reason to be suspicious of a tightening-up of record keeping.  Since negative Consequences have so often followed the implementation of better record keeping, you can hardly be surprised at labor's negative reaction.

But it's ridiculous to suppose that Recording can have only negative Consequences.  That's certainly not the point of keeping score, and it's not why we use it.  Truly efficient Recording, in fact, would lead to as many (or more) promotions as firings, as many bonuses as dockings of pay.

We recently did some of our own "time and motion" studies in a company where the labor-management history had been less than progressive, and in which the labor contract specifically prohibited the public display of individual performance measures.  Talking to labor and management leaders, we discovered why this clause in the contract had been introduced:  the union thought it was a necessary safeguard against "intrusion" by management, and specifically against the peremptory firings that they expected would follow the posting of the performance data.  The general idea among the workers was that, once such data was collected, it would be used as an excuse for getting rid of people that management just "didn't like."

It took us about two weeks of convincing, but we were finally able to persuade the shop foremen involved to accept performance postings on a trial basis.  The result didn't surprise us, but it shocked the hell out of the labor leaders.  Within two weeks after the Recording element had been introduced, workers had become so enthusiastic about finding out how they were doing that they would not let their supervisor leave in the evening before posting that day's results!  The contract clause prohibiting such "intrusion" was promptly forgotten by labor and management alike.

Why this abrupt turnaround from suspicion to cooperation?  Because the way we had introduced the Recording element stressed the importance of positive, not negative, Consequences.  As part of the trial arrangement, we agreed that demotivated or poor performing workers would be privately counseled and aided by their supervisors to improve.  The graphs indicating the daily "scores" would focus only on those workers - or teams of workers - whose performance had been above average.  You should have seen the rush at the end of each day to see if a worker's name had appeared on the list.  With that simple example of positive Consequences - the public acknowledgment of a job well done - we were able to transform an entire factory supposedly full of "lazy, irresponsible" people into people who were driven to excel.

There's a similar lesson to be learned, in a more humorous fashion, in the old Spencer Tracy/Katharine Hepburn movie Desk Set.  She's the supervisor of a public information service employing several people in an antiquated library.  He's an efficiency expert with a computer who wants to make their work easier by putting the library on disks.  Only they don't know that.  When he comes in with his charts and data banks, they assume (like the workers in the plant we upgraded) that he's out to eliminate their jobs.  They begin to sabotage the computer until it goes haywire, and it's only after they understand that the machine is meant to assist them, not get rid of them, that the researchers begin to use it to advantage.

The moral goes back, as usual, to Consequences.  Recording can be a critical element in the upgrading of motivation and performance - but only if the people being recorded understand that the scorekeeping will make a positive difference in their lives.

3.         "We're doing just fine without it."  Management often tends to track and monitor bad performance more closely than it does good work.  It's strange, but true - and we saw it happen with dire results in the boom-and-bust economy of the 1970's.  When things were sloping downward, everybody wanted to know "what's wrong," but when things were moving up, people were far less interested in knowing why things were going right.  And because they didn't take the time to track upward motion - to find out why it was happening - they eventually found themselves going downhill again.

In a very perceptive article called, "Made in America," business writer M.R. Montgomery, linked this dangerous penchant for forgetting about keeping score when you're winning to a physical manifestation of scorekeeping, the manufacturing gauges known as "process controls."  His description in the Boston Globe Magazine shows how closely these controls are linked to what I'm calling Recording:

"One of the ways to get the insensitive supervisor off the worker's back ... is to give the worker instant and objective information on the quality of his work.  Modern factories have machines that automatically gauge the dimensions of parts, confirm welding temperatures, and otherwise keep track of what's happening to a piece of metal as it goes down the line.  These are "process controls," and when the worker has access to them, he has that instant and objective measure of how he's doing his job."

"Instant and objective information" about "how he's doing his job."  You couldn't have a better thumbnail definition of a good Recording system at work.  The trouble, as Montgomery describes it, was that as the economy of the early 1970's began to expand, these critical performance gauges were dropped.  "In the booming economy, our companies accepted high-scrap rates and passed on costs rather than instituting quality control."

You can get away with that kind of penny-wise/pound-foolish approach for only so long, and eventually the chickens will come home to roost.  That's what's been happening more recently - and not surprisingly, as scrap overrun costs begin to eat into profits, top management begins to look again at the value of process controls.

They could have saved themselves a lot of grief if they had continued to "keep score" on scrap figures in the boom days as well as the bust ones.  The fact is that you always have to know how you're doing - whether you've shot an 80 or a 65, whether you've got a 40 percent share of an ad market or 14.  If you forget that in good times, sooner or later you'll get clobbered, because there is nothing more demotivating to good performance than the attitude that "We can't be hurt."  In this economy, nobody is immune from downturns.  Ask Braniff, or General Motors.  One of the best ways I know of to guard against an "unforeseen" dip in your fortunes is to keep your eyes open while you're sailing high.

Alabama coach Bear Bryant said it well.  "Most coaches study the films when they lose.  I study them when we win - to see if I can figure out what I did right."  He didn't get where he was by assuming winners don't need to know why they've won.  He got there by studying the films - by tracking the scoring Records - after every game, win or lose.  And I'll guarantee you he didn't keep the scorecards to himself.  I'll guarantee that, in every one of those filming sessions, the entire ‘Bama team was watching with him.  

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