An easy fix for our economy from Warren Buffet
Root causes. Elegant solutions. Maybe it's because I am an
engineer by education that I love to find the really simple
solutions to complicated problems. That's really the entire
mission of Operating Principals. Businesses seem to address
symptoms of problems with complicated solutions that just
exacerbate the underlying issue. Too bad our politicians seem to
do the same.
ve recently had some conversations about the use of target
metrics. Ok, ok, I’ll fess up….not so much conversations but
rather my ranting about targets when any remotely related topic
came up. The best way I can explain my loathing of target
metrics as goals, especially when they are tied to rewards, is
that they are a means being used as an end.
I like goals.
Goals are great. However, a very common practice is to create a
goal and then set a target metric to it. For instance, grow our
revenue by 12% or capture 4 points of market share from our
Other than at work, do you remember the last time you saw the bell
curve? For most of us, it was probably at school where it was used
to describe the distribution of test scores and to help the instructor
determine grades earned. In this context, the bell curve was
used to measure and evaluate student performance on a common test
A new year often is the start of a new beginning. It is time
to begin anew, to turn a new page, freshly scrubbed of guilt from
foibles past. Just not when it comes performance reviews.
Here the ghost of the year past comes to inhabit the present and
haunt the future, becoming the unwelcomed guest that refuses to
Daniel Pink's book, Drive, summarized some of the research on how
people are motivated and how they are not, with money being
a huge de-motivator. Even though this book was a huge popular success,
very few companies have eliminated their incentive compensation
systems as a result. As someone who once helped put this type of
goal-based compensation in place, I can offer another reason why
companies should eliminate this practice.
I was once part of a team that was developing a career ladder with
job positions for our department. We were led by an HR consultant
and during the first meeting, she told us that one of our ground
rules was to describe the job and not the people in the job. We
needed to separate the business element from the people element.
That's when I mentioned that I didn't believe the job could be separated
from the person in the job, and I got a response along the lines
of, "Don't be absurd, of course they are separate.