In Hindsight: Not Everything That Counts Can Be Counted

"Managers who don't know how to measure what they want settle for wanting what they can measure."
- Russell L. Ackoff & Herbert J. Addison, "Management f-Laws: How Organizations Really Work" (2007)

The title of this section got a lot of people nodding in agreement, recognizing the pervasiveness of “management by measurement” in the public service.

One thing I had underestimated however was that many managers and even some senior executives would suggest that in order to get better at people management – which has traditionally been something considered difficult to measure – we should provide managers with financial incentives, i.e. a "performance pay" based on how well they managed people.

That’s absolutely ludicrous! To begin with, there is growing evidence that pay for individual performance produces mixed results at best (see Jeffrey Pfeffer's work on the topic - this is a must read!). Pfeffer further explains that:

"Tinkering with pay appears to be easier than fixing organizational cultures and leadership capabilities. It is apparently "fashionable" because it does not seem to require the systemic intervention along multiple dimensions implied in the idea of building high performance work arrangements."

This is why I think the conventional thinking on which the argument of the managers above is based is fundamentally flawed.

People management should not be an after-thought or something managers do on top of the rest, but rather the foundation on which they can achieve all the rest. Good people management should be the default performance expectation against which managers are held accountable. Under absolutely no circumstance should we reward managers with a financial incentive for doing what should be considered the basic minimum. The perverse effects would simply be to great.

At any rate, we don’t need any kind of incentives to get managers to value people management. When the Values and Ethics Code for the Public Service was implemented, public servants were not told that complying with the Code was something "they could do at the end of the day, if they had time", and that those who comply would be rewarded. No. You either comply with the Code or you don’t; and if you don’t, you shouldn't be public servant to start with. Well, it turns out that there is a section in the Code called “people values”... Perhaps every manager and senior executive should re-read this section, think about the implications for people management, and then try to decide if good people management is really just a nice-to-have or, as I believe, a must-have.

I would also add it is a myth that people management is difficult to measure. The Public Service of Canada uses a great tool called the Public Service Employee Survey (PSES), which provides over a hundred indicators that are linked in one way or another with people management at the organization level. If I was a senior executive having to hold accountable my direct reports for the quality of people management in their unit, I would use the PSES as a benchmark, set clear performance expectations for what I would want the PSES results to look like in a year from now, and make this part of the managers' personal objectives in his annual performance appraisal.

In my organization, we have already been administering the PSES internally in-between the public service-wide surveys of 2005 and 2008. It is a very valuable tool that provides a good overall assessment of the well-being of the organization and can be used to measure the quality of people management. I’m glad to see that the Clerk indicated that the PSES will become an annual thing.