Posted on June 6th, 2016

The “blankie” is the plague … no … the absolute albatross, of American corporate performance! That’s right … your eyes don’t deceive you … the “BLANKIE” is killing corporate performance, profitability, and prospective.

The “blankie” calms young children, making them feel comfortable when nothing else can pacify, often providing the only hope a parent has to keep them quiet or get them to sleep. In fact, Mom and Dad probably have several copies all over the house, cars, etc, just in case of unforeseen flare up.

Typically, at some point (hopefully long before the kid starts shaving or wearing makeup), one of the parents just can’t take it anymore … “I’ve had enough! GIVE ME THAT BLANKIE!”

Well, the time has come for some corporate parenting.

The corporate “blankie?” … bloated performance management: hyperactive metrics, measurement, analytics, …

To understand the issue, just take a stroll through the corridors of most companies, even many small ones. You’ll likely find the walls plastered with charts, metrics, etc., many contradicting and few the typical employee can tie directly to stated organization imperatives. While some contradiction can be traced to legitimate value chain forces, many differences can only be traced to “blankies.”

I had the privilege of working for Dean Roberts once. Dean is now Senior Partner at Executive Partners International. Dean used to point out that there were so many metrics in some companies that it seemed they employed a VP for each just to track and control it. He called it “A VP for every metric.” That was over ten years ago, but this thought couldn’t be more true today.

It is at the VP-level in most organizations that the bloat of performance management systems takes place. Almost by definition, each new executive is motivated to distinguish themselves. This differentiation has to be readily seen in performance reports for their contributions to be recognized. Unfortunately, true contribution is often so poorly measured that they are forced to highlight (often create) activities that can be more readily reported on, even if they have no ultimate positive causal impact on organizational performance.

When irrelevant metrics and performance measures proliferate, the beacon for the organization becomes defective. Unconnected metrics dull the impact of deficient performance on critical ones. Once dashboards, etc., are built that incorporate the extraneous, it becomes more and more difficult to chart the actual course being taken. The typical and unfortunate response to this is often antithetical … another metric … a “blankie.”

These inapt metrics rob performance and productivity, choke profitability, and because the plumb line is corrupt, starve prospective. Reversing this effect is straightforward but far from easy. Here are five proven steps:

  1. Use Metrics Exclusively and Uniformly. Make sure every organization member’s performance is assessed only on critical activities or outcomes that support enterprise imperatives, then retire unconnected metrics … period.
  2. Identify Metric Interactions and Causal Relationships. Map cause-and -effect associations for all metrics. (Many have failed because they started here without first completing Step 1.) Classify each as leading or lagging and track their relative proportion at all levels of the organization. The leading:lagging ratio should shift as you move up the organization from about 3:1 at entry level to 1:5 or so at the top. Champions, visionaries, and C-Suite Executives can employ a third classification: launching, tied to shifting imperatives, corporate challenges, etc. Once incorporated into the operating system, these should be reclassified as leading or lagging.
  3. Keep Metrics Fresh and Relevant. Align the entire corporate life-cycle (acquisition — of talent, product/service, partner, … — to decommission) to tangible metrics, reflecting changes (without fail) in strategy, vision, and imperative (update forecasts, career ladders, compensation plans, etc.).
  4. Ban Usage of Rogue Metrics, Charts, Reports, Etc. If desired, allow personal, unofficial use, but forbid, under any circumstance, their usage in general performance reviews or other standard business meetings or on walls or public monitors … period.
  5. Automate Standard Metrics to the greatest degree, exclusively if, possible.

This takes guts and certainly won’t be accomplished overnight. A company with enough determination can do this alone, but sustainable success is most likely with an experienced, objective, highly-skilled external partner.