Opinion counts too

GUEST COLUMN/ Subjective evaluations may prove more productive than attempts to quantify learning

What gets measured, gets done. It's a motivational strategy that's proven and powerful. A disciplined practice of holding people accountable to numbers is often touted as a hallmark of successful companies.

But there are limits to the doctrine, and companies that want to reenergise their innovation machines risk doing far more harm than good by taking this discipline too far. Will you be part of the problem?

The possibility of reducing your peers' and employees' performance to a single number has unquestionable allure. Objective measures reassure employees. They seem intrinsically fair. They make performance transparent and self-motivated goal setting more likely.

And objective measures help you as a leader as well. Without them, evaluation is difficult and stressful. When you evaluate someone negatively, they might challenge you. They could question your criteria "" or even your ability to assess what they do. You may naturally be defensive. How wonderful it would be to point to a single number "" and immediately end the discussion.

There are situations in which this is possible and works reasonably well. Sales people are often measured against quotas. Evaluations of taxi drivers can be weighted heavily to their safety records. And field goal kickers are assessed on their percentage of successful kicks.

But there can also be perverse consequences. Software programmers measured on the number of lines of code they write may produce inelegant and buggy modules.

Research scientists whose bosses count patents may generate obscure inventions with little practical utility. And executives measured by stock price may find ways to inflate the stock this year while hurting the company in the future.

In fact, the jobs that are most effectively reduced to single quantities are the ones that are the most one-dimensional. The broader a person's responsibilities, the more complex and subjective the evaluation. Measures become more ambiguous.

There are more stakeholders with a wider range of needs. Evaluations come at specific points in time, but there are always short-term versus long-term tradeoffs. In the face of such complexity, do you want to motivate only what is measurable?

What gets measured, gets done. When you have a clear, unambiguous measure that captures most of the value of a person's work, use it. But recognise that this is a luxury. It is not the norm.

In fact, there is always a heavy dose of subjectivity in evaluating managers and executives. Accept it. At best, you can tie performance to pre-negotiated predictions of what is possible.

For mature businesses with plenty of consistent history on which to base predictions, this is reasonable. But the innovation process is anything but predictable.

So how do you evaluate a potential hero in your organisation "" an innovator leading an experimental new business? You would like to tie your assessment of the innovator's work to the performance of the business.

But how do you evaluate the business? Operational measures believed important in your core business are likely irrelevant. And there are many unpredictable factors, so luck is a major part of the outcome.

The worst thing that you can do is tie your evaluation to predictions made in initial plans. Experimental businesses almost always fall short of predictions. Consider what will happen if you hold the leader accountable to those predictions.

In all likelihood, they will soon perceive that they are failing. They will withhold information from you. They will scramble to get back to plan "" to prove that they are not failing. The one thing they will stridently avoid is what you need them to do most "" re-evaluate the plan. Therefore, they will not learn from experience.

Now, imagine instead that you tell your innovator that you understand the unpredictable nature of what they do. Therefore, you will evaluate them subjectively "" based on the speed of their learning and the quality of their decision-making.

Immediately, their behaviour changes. They are more willing to step back, reassess and redirect. They may even take on a crucial dose of humility. They will not lead with statements like "If everyone works hard and performs at the top of their game, we will be wildly successful, as planned."

Instead, they will tell their teams something like: "We are a talented and unique company. We have an opportunity to have a tremendous impact. But there are many uncertainties. Nobody has the answers yet. We have to be alert, and figure out what it takes to succeed in this market faster than our competition." In doing so, they engage the entire team in learning.

More importantly, you will learn. Your innovator will candidly discuss setbacks and surprises because this is the only way to make quality of thinking transparent "" and, therefore, excel on your subjective evaluation. Knowing that numbers will not speak for themselves, your innovator will be anxious to demonstrate learning and adaptability.

Through frequent interaction, you will get to know your innovator in depth. When the performance evaluation is due, you will be able to go far beyond just the numbers. And you will both be better for the experience.

(Vijay Govindarajan is the Earl C Daum Professor of International Business and the founding director of the William F Achtmeyer Center for Global Leadership at the Tuck School of Business at Dartmouth College. Chris Trimble is on the faculty at the Tuck School of Business at Dartmouth College. He is also the executive director of the William F Achtmeyer Center for Global Leadership at Tuck. This article originally appeared on fastcompany.com Copyright: Vijay Govindarajan and Chris Trimble)