Page 87 - Performance Leadership

76 • Part II Operational and Analytical Dimensions

monitoring is needed because of price competition in many industries.
With tiny margins there is no room or time for error. Organizations
use the pretzel model so that they can be on top of the game all the
time.
However, caution is warranted. For years, managers claimed they
needed comprehensive and immediate information in order to make
optimal decisions. Others have countered that, pointing out the dan-
gers of “analysis paralysis,” where too much information leads to stifled
organizations. Immediacy of information has been a hot topic for years,
but mostly a theoretical discussion because it wasn’t possible on a tech-
nical level. With IT innovations, it becomes possible to create and sup-
ply more real-time information. This means that considering where
real-time information makes sense, and where it doesn’t, becomes a
crucial question. Sometimes daily is more than enough, and sometimes
an immediate response is necessary.
There is much “hype” surrounding the subject. In many cases, real-
time simply doesn’t make sense. Consider the example of “real-time
customer satisfaction.” How should that be monitored? And if customer
satisfaction is decreasing during the day, what can be done about it? It
is much more important to have a solid understanding of what drives
customer satisfaction. For instance, in a logistics organization it makes
sense to have control of overnight delivery, predicting workload in the
various activities of the process. Managing these drivers of customer
satisfaction in real time should lead to overall customer satisfaction.
To know where real-time management information is needed, it is
important to understand how decision-making processes work. Deci-
sions at an operational level, such as those concerning inventory man-
agement or workload analysis, are usually based on quantifiable data,
singular facts, and clear events, all of which usually come from a sin-
gle process or system. Based on a clear set of data and a clearly defined
scope, decisions can be made. Decisions follow facts.
For more senior managers the decision-making process is different.
Often, decisions are based on market insight, various, seemingly unre-
lated and certainly unintegrated qualitative and quantitative sources.
These decisions are more future-oriented, often based on uncertain
scenarios, and not always as quantifiable. However, senior management
needs to justify these decisions to shareholders, employees, and other