Fred Nickols takes issue with a quote from Goldratt, to wit:
>Tell me how you measure me, and I will tell you how I will behave.
As a description of human psychology, I think the quote is exactly right.
I was taught long ago to "expect what you inspect." And, in my
experience, that is what happens.
I once consulted with a large financial institution whose major customer
activity was making loans. They couldn't get out of a long-standing
dilemma. Every so often They would hold contests and, more to the point,
measure performance based on "loan volume." And every time they did this,
loan volume would rise.
Then senior management would notice that profitability was dropping. So
they would issue the edict to improve the quality of the loans being made
and, more to the point, would measure loan officers' performance by the
quality of the loans they made. And every time they did this, loan
quality (and profitability) would rise.
But then senior management, noticing that loan revenues were down, would
encourage loan officers to make more loans ...
By the way, in one of those experiences that makes me wonder if being a
consultant is a lot like stealing, my recommendation to them was simply:
"Why don't you measure, and reward, the making of lots of high quality
loans?" And we set up a system to measure loan quality and to reward loan
officers for a high volume of loans that met an established standard of
quality. Guess what happened? Both volume and profitability rose.
--"John Gunkler" <jgunkler@sprintmail.com>
Learning-org -- Hosted by Rick Karash <rkarash@karash.com> Public Dialog on Learning Organizations -- <http://www.learning-org.com>