Systems Thinking and ROI LO13825

Eric Opp (eopp@mrj.com)
Tue, 3 Jun 1997 16:12:47 -0400 (EDT)

Replying to LO13700 --

On Thu, 22 May 1997, Edwin Brenegar III wrote:

> Two
> different perspectives which could have sold the copier. So what is the
> correct measurement? Copier sales, features, or worker productivity? Or
> all of them.
>
> My point is that while the numbers help to clarify decisions, the decision
> is really about something other than the numbers. It is about the values
> we place on the use of time, which we can describe in terms of hourly,
> quarterly productivity. The numbers have to be interpreted.
>
> Let me provide another example. In the public schools in our state (NC)
> student test scores are the measurement used to evaluate administrators,
> teachers and whole systems. Just test scores. There is a great debate
> about this currently because it is felt by many parents that the test
> scores do not get at many of the educational issues of concern to them.
> The test scores say nothing about the breadth or integration of the
> curriculum, or the climate or culture of the school. And if I was a
> teacher, and merit pay was based on test scores, I'd teach to the test.
> If you listen to students, teaching to the test misses alot of educational
> opportunity. It doesn't challenge the student to be any better than his
> or her grade level. This is a numbers oriented system. I believe in the
> tests, because they do measure student achievement. But I don't believe
> they are a sufficient evaluation measure of the quality of schools.
>
> I think that the "numbers" are important, but that how those numbers are
> conceived and interpreted are equally important. And having the numbers
> without an interpretive scheme misses the value the number bring to
> evaluation and assessment.

Ed,

I feel I owe an attempt at an answer to your point(s). I totally agree
with you that numbers require interpretation and that there are concepts,
which we understand intuitively but have a hard time putting numbers on.

In the sales situation, the real "answer" in the end turns out not to be
the numbers so much as it turns out to be a factor of the personality and
values of the prospect, who is sitting across the table from you. If the
prospect has the same personality and values as you do, then the sale will
be easy (read between the line, the people we like the most are those with
a similar personality profile and values as we ourselves have). The trick
in the sales situation is to adapt yourself to the personality and values
of the prospect (not an easy thing to do, but can be learned). The sale
will be closed easily if the prospect likes you, even if the cost is more
than some other vendors offer.

If there is nothing else to go on, the manager or prospect must base his
or her decision on something. That something for the businessman comes
down to dollars and cents. If you were just going in to sell the features
of the copier, the businessman can simply respond that the current copier
is not fully utilized, the copies do not have to be of a high quality,
because they will only sit as a reference on someone's desk. There is no
reason to buy. If you show them how to save lots of money, they have a
compelling reason to buy.

For the numbers, you have hit on one of Demings 14 points or some
corollary to it, namely you get what you measure. The problem is that
often you measure the wrong thing, or you measure the right thing for the
wrong reasons, and you end up with a mess. You and I both know that there
are many components to being well educated, and scoring high on
standardized tests is not the only measure. If we simply go in with the
statement: "I know a good education when I see it" without **any**
external measure, the students have no idea what to work toward, and often
the teachers don't know what to teach.

One of the most fascinating things that I have participated in recently
is the beginnings of a software process improvement initiative. Once
examining the Software Engineering Institute's Capability Maturity Model,
I began to realize that it is a road map for the improvement of many
different processes, but it has an odd structure to it. You are literally
building a very strict (Tayloristic almost) organization in the initial
stages, and then you are loosening the reigns as your team members begin
to internalize the process (becoming the ideal of a learning
organization). What you need to begin to do is simply to put some
structure on the process - **any** structure - that you can then begin to
refine. This really hit home for many people during a seminar on Quality
Assurance (QA). QA is done for the purpose of insuring that some process
is being followed correctly - it has nothing to do with the outcome! In
fact you can get an excellent QA audit and still come out with a bad
quality product! So much for the old adage of managing for results and
letting the worker figure out the process. It's quite a sticky wicket!

I think there are many educational institutions that do not really
realize what they are doing in terms of using test results to measure the
outcome of the educational process. But I think it is a bit like Winston
Churchill's comment on democracy - "Democracy is a poor system of
government, but it is better than any of the other alternatives."

Sincerely,

Eric N. Opp
eopp@mrj.com

-- 

Eric Opp <eopp@mrj.com>

Learning-org -- An Internet Dialog on Learning Organizations For info: <rkarash@karash.com> -or- <http://world.std.com/~lo/>