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Courtesy University of North Carolina
The objective: be better than last week
Is the baseball or football game more important? Are business people
untouchable, their egos too fragile, to allow their actions to be
examined under a microscope? Are they above asking coaches and other
experts to give them an objective view on what can be done to improve
the odds of success? It takes some kind of chutzpah to suggest a
negative answer to any of those questions.
If there were a rigorous process of examining the impact of decisions
after the fact, the CEO would clearly be better equipped to explain
the results to outside critics rather than relying on his memory
or oversimplified truisms. Engineers constantly examine designs
that work and endure the rigors of use. Lawyers use precedent as
their basis of action. Neither profession would dream of leaning
on long-ago learning and current intuition as the key sources for
decision-making. Who would choose a doctor who does not consult
on the diagnosis, or who does not keep up to date on developments?
Peer reviews are standard procedure in most professions. Why not
for business cases?
Imagine this: The CEO of XYZ Ltd. calls a meeting of his senior
executives shortly after they announce a decision to close a plant,
abandon a business segment or lay off thousands of employees.
Taking the floor at the front of the boardroom, the CEO opens the
discussion by saying: "Ladies and gentlemen, we have just announced
a decision that deals a body blow to our shareholders and our fellow
employees. What went wrong? When did it go wrong? How could we have
been more sensitive, read the signs earlier? The meeting will be
over when we get the answers. Any questions?"
Think that happens? Not so's you'd notice. But what if the CEO
then said this: "I have asked Joe and Susan from Garfinkel
and Hudson to help us with this examination."
Where did we go wrong?
Athletes of all kinds are constantly seeking outside opinions from
proven experts, looking for often minute adjustments that will enable
them to improve. These coaches and experts may not be able to perform
at the level of the people they advise, but they do provide invaluable
input, the dispassionate outside perspective, the softer focus on
events that may be happening at the periphery of the company's vision.
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Or consider this. Suppose, before opening up the floor for discussion,
our CEO said one more thing: "And Joe and Susan have tapes."
Imagine the silence. Imagine the message that would send: we expect
people who are compensated at an elite level to perform at that
level . . . or do their damnedest to get there. And you can't hide.
Video recording is not as cheap as a paper copying machine, but
in the big picture it's close enough. Why do we not use it more
in business to record the decision process for future reference?
And do it both for the hits and the misses.
When sports teams review performance on tape, theydo not cut players
for single mistakes or imperfect executions, although clearly they
will for failure to learn, for not trying to improve or for not
accepting coaching. Is that a bad thing? Surely that process can
cut through the clutter of organizational politics in favor of real
meritocracy.
Now, obviously, putting video cameras in board and meeting rooms
would be an enormous shock to most organizations. But clearly, as
misjudgments and miscalculations continue to manifest themselves
in job losses, profit squeezes and share price erosion, executives
and directors need better tools to examine their decision making.
Maybe not video, but then again, why not?
The Best Laid Plans...
Business people, like athletes, cannot expect to hit
a home run on every play, but they are fully capable of studying
performance -- using, accumulating statistics and profiting from
improved execution. This analysis would give business schools better
empirical tools, whether they use the case method or not. And ultimately,
it would improve business performance which not only helps executives
and boards, but also translates into better times for customers
and employees.
In the end, whether the game is business or sports, the devil is
in the details. Improving a golf swing, a slider or a balance sheet
is a detailed and subtle business. All need critical analysis, perhaps
even slow-motion, frame-by-frame examination and a comprehensive
understanding of the mechanics.
It all begins with the recognition that performance excellence
is the imperative. And getting there requires help.
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