by William Barclay | Nov 23, 2022 | Management, performance gaming, Popular, Targets
Has the Law of Unintended Consequences ever been better illustrated than through the use of management targets? They continue to have widespread use in both public and private enterprises. Ingenuity has no bounds in applying them to different aspects of performance: profit, efficiency, return on capital, timeliness, customer retention rates, staff retention rates and staff attitudes to mention just a few. And the use of targets appears frequently to encourage changes in management approach in a directive and often aggressive direction. There is no shortage of reports of dire consequences for individuals, team and business functions who have allegedly failed to achieve their targets. But this culture is now sufficiently long-lived for a panoply of negative impacts to have become apparent. Let’s consider some of them.
Targets may:
* be misaligned with desired outcomes and as a result misshape and degrade productive effort
* give rise to a variety of gaming approaches resulting in significant dysfunction and degradation of staff culture
* damage the standing and reputation of leaders and managers whose use of targets does not accord with their espoused values
* give rise to levels of stress far above those that might be normal in working life causing lowered morale, increased sickness absence and higher staff turnover rates
* diminish motivation amongst public services staff for whom the public service ethos has meaning
* lower the status of the front-line production/service delivery function relative to other functions within an organisation whose staff are not subject to such a harsh environment
Management-by-targets carries an assumption that the targets can adequately represent real priorities. But resources may be diverted to those aspects of activity that carry targets, damaging other areas of activity. Furthermore it can be more difficult to assign targets to the quality of outputs than the quantity.
Many examples of targets giving rise to gaming have been reported, in other words modifying working practices so as to give an apparent improvement through target metrics but not an improvement experienced by clients. This includes re-assigning resources to target-bearing outcomes to a degree that is bound to degrade non-target-bearing outcomes. Processes may be changed to produce an apparent improvement in timeliness but only by artificially making job start times later or finish times earlier. ‘Working to a target’ can result in deliberately slowing activity once a target has been met – the threshold effect; or continuing activity but not recording it until the start of the next reporting period. The reported staff capacity of a work centre may be artificially lowered when targets are proportional to staff capacity.
Failures to meet targets can be associated with sanctions against teams and individuals, sometimes as serious as dismissal. Management theorists
who claim that fear is a poor motivator are wrong. It was no surprise when a survey by the Chartered Institute of Professional Development in 2018 identified stress as the single most important factor for long-term sickness absence in the UK public sector.
There are likely to be more operational pressures in a targets regime on direct delivery staff than on staff in support functions. This is a likely cause of discontent for operational staff. A possible consequence is that operational staff seek moves to other functions damaging delivery capabilities.
The public service ethos can be eroded by a targets culture. It means motivation from a sense of working for the public good, and fulfilment from following principles of thoroughness and neutrality. These personal impacts can be suppressed by a targets culture that produces a commoditisation and narrowing of service provision.
The impact of targets on employees is compounded by league tables – performance data published periodically through which different workgroups can be compared. This is likely to add a new and particularly keenly-felt type of pressure. There are four possible combinations of outcomes depending on targets compliance and league table positions:
Targets failure – League position poor – Calamity
Targets failure – League position good – Comeback
Targets success – League position poor – Comedown
Targets success – League position good – Clover
Low positions in league tables are often more impactful than targets failure – they are seen to be an indication that it is possible for the workgroup to perform better but they have failed to do so. This can depress morale and accentuate rivalries, damaging organisational culture. If the behaviour of leaders and senior managers does not support an espoused culture of support and cooperation, trust can be damaged or even destroyed.
Experience shows that targets can have a place but they need to be few and true. When employed they need to be small in number and carefully related to the real priorities of the organisation. And they should be used sensibly, with an understanding of their impact on staff, and kept fully in alignment with the espoused organisational culture.
by William Barclay | Apr 20, 2022 | customer service, Popular
Is the Customer Always Right?
‘The customer is always right’ is an oft-repeated maxim. But is it right? The idea has been around for a long time – it was popularised by American retail magnate Harry Gordon Selfridge in the early 1900s. Organisations do have to be keenly aware of the needs of their customers. But it is their consistent needs expressed as a group that are important. The attitudes, behaviours and propensity to complain or praise of individual customers are widely variable. Accepting a complaint that is clearly wrong or vexatious can have seriously negative consequences. Dealing with difficult customers can be a demanding and frustrating task for staff which consumes an undue amount of time. If managers side with this type of customer, relationships with staff are likely to be damaged. The retention of quality employees providing good customer service is a central success factor for organisations. Company culture plays a major role in keeping employees loyal and productive. Customer service is at its best when employees are empowered to deliver it with freedom and discretion. But this has also to include the power politely to explain why a complaint is not valid.
Of course customer feedback can be very valuable. There is truth in the belief that in the past some senior leaders in public services have been strangers to the need for feedback from service users.
Formal exercises for its collection need to be carefully designed if the results are to be meaningful and free of distortions from organisational politics. Questions need to be open and balanced. Responses need to be collected in an objective and accurate manner. Whilst the observation of repeated messages in customer feedback has the most pertinence, individual pieces of feedback can occasionally strike a chord and form a basis for improvement actions.
The development of a customer-focussed culture is often associated with transformation programmes in public services when organisations wish to adopt a more businesslike and commercial approach. The establishment of ‘customer-related’ job roles and feedback mechanisms may be part of these programmes. But the danger of ‘culture cranks’ needs to be avoided – individuals who believe that personal kudos is strongly associated with the promulgation of the new culture and who for example may be prepared to use any negative customer feedback, even when unjustified, to further their own agendas. It is the responsibility of leaders to develop a balanced culture in which excesses of zeal do not have negative consequences. Used appropriately, customer feedback can support and develop operational excellence, not detract from it.
When a complaint is valid, the response needs to be quick and meet or go beyond what the customer might expect. Some customer theorists have suggested that to have a complaint and deal with it well is more beneficial to an organisation than not having had the complaint in the first place. This is a risky belief but is deserving of some credit for the recognition that exceeding customer expectations can be of real value.
Read more in the book Targets and Terror by William Barclay. Available from Amazon: https://www.amazon.co.uk/Targets-Terror-Englands-Management-Revolution/dp/1916035388
by William Barclay | Apr 20, 2022 | performance management, Popular
Why is performance management so poor?
In no area of management does practice differ from theory more than Performance Management. No other responsibility of managers damages their standing as much. Performance management comprises the arrangements that organisations use (i) to maintain and improve the performance of their workforce so that the organisation achieves its goals and targets; and (ii) to motivate employees and to recognise and develop their abilities. In public services it has usually involved meetings between a manager and employee at which the performance of the employee is discussed and sometimes an appraisal rating given. At the same or a different meeting, the personal development of the employee is discussed and plans agreed.
A fact sheet produced by the Trade Union Unison in 2017 on Performance Related Pay stated ‘inevitable variation in the grading of staff by different managers leads to perceptions of unfairness, discriminatory practice and resentment among staff’. Yes indeed. Appraisals conducted by one individual on another can be highly subjective, widely variable and sometimes morally corrupt. Formal criteria can be twisted, used selectively or ignored altogether. A change in manager can turn a staff member’s performance ratings upside down. Favourable ratings can arise for a variety of unofficial reasons including a jobholder having a similar personality and outside interests as the manager; slavish and unthinking support of the manager by the reportee; and a reportee and a manager having similar educational backgrounds. Unfavourable ratings can be related to a clash of personalities or genuine differences on matters of policy and procedure.
The design of performance management systems needs to recognise all of these major limitations. Performance incentive payments as non-consolidated awards to work groups of staff can be effective. The awards should depend on the group meeting a small number of agreed priority targets and should not count towards salary for pension purposes. Promotions should be administered as fairly and professionally as possible. Decisions should not depend on the viewpoint of one person alone.
Most importantly, the personal development of staff should be the primary focus of performance management, not appraisal. It can have major positive impacts. As well as boosting organisational performance, it can assist staff retention, serve succession planning and contribute towards a positive culture. The resource expended on it can be repaid many times over. The skill set of managers of people should include the ability to identify the potential of staff and knowledge of the various means – training, coaching, mentoring, job rotation, small-scale progression experiences – of realising that potential.
Read more in the book Targets and Terror by William Barclay. Available from Amazon: https://www.amazon.co.uk/Targets-Terror-Englands-Management-Revolution/dp/1916035388
