Page 54 - Performance Leadership

Chapter 3 Measurement Drives Behavior • 43

claims manager decided to publish a weekly graph of claims processing
production for each group on the message board near the coffee
machine. It was a very straightforward initiative, no speeches about tar-
gets, no full-balanced scorecard implementations or cultural change pro-
grams, massaging of the data by middle management, just feedback
through the graph. After a few weeks, the effect became visible. Opera-
tional staff typically strive for harmony, not competition (like most man-
agement groups). Group East offered Group West help, taking over some
of its claims because two staff members in Group West were absent due
to illness. Group East relied on the help of Group West over the follow-
ing two weeks while a few employees were on holiday. The workload
began to balance itself automatically and the average processing time
decreased. This was all done through straightforward feedback.

Case Study 2: Negative Impact of Measurement due to
Misunderstanding Company Culture
A waste management company, a privatized organization that was pre-
viously owned by the city, decided to implement performance
indicators. The CFO had a difficult time achieving this, as the vari-
ous districts felt this was violating the “privacy” of the district and its
employees. The CFO pushed the initiative through. He proceeded in
the way best practices suggest. If you share performance data through-
out the organization, you are providing feedback. By sharing that feed-
back openly, you allow different parts of the organization to rank one
another in a competitive culture or to ask other units for best practices
in a collaborative culture. Unfortunately, contrary to theory, the per-
formance of the highest-scoring districts went down after a few
months. Upon investigation, the CFO found that the worse-scoring
districts were accusing the best-scoring districts of being “traitors”
because they made them look bad. This led to conformist behavior of
the better-scoring districts to create equal, or even lower, performance.
The two examples, although playing out in different industries, are
very alike. Both organizations have cultures based on harmony, and both
examples deal with direct feedback to the people at the operational level.
Perhaps a defining difference is that the waste management company
was in a process of cultural change. It is interesting to see how both
groups reacted differently. Could this have been predicted? It could