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dependable means of focusing atten-
tion where it needs to be.
Enables accountability. Numbers
do not lie, and thus it is impossible to
hide behind them. Organizations,
departments and individuals must
maintain defined standards when faced
with the reality of measurement.
Facilitates feedback. It often proves
difficult to discuss a person’s or depart-
ment’s weak performance without
them taking constructive criticism per-
sonally. When this happens, the
accused person(s) assume a defensive
position and, ultimately, little produc-
tive communication takes place. How-
ever, by discussing departmental stats
or a person’s performance record, theconversation flows freely because the
focus has shifted to a neutral, third
party—the number or measurement
itself.
Increases problem prevention.
Measures by themselves are worthless.
However, measurements can be used to
identify negative trends before they
blossom into full-blown problems.
Removes bias. Focus groups, inter-
views and conversations all use sub-
jective interpretation to reach conclu-sions. On the other hand, well-crafted
measures are inherently consistent and
objective, removing individual biases.
How MeasurementRelates to Your Business
Robert Kaplan, of Harvard Univer-
sity, famously states: “If you can’t meas-
ure it you can’t manage it, and if you
can’t manage it you can’t change it.” A
simple translation of this sentence is: If
you don’t measure something, you can’tmanage it, which means you won’t be
able to improve it.
The intangible drivers of leadership,
communication and teamwork (LCT)
are key employee-performance factors
that are not frequently measured.
According to Kaplan’s theory, lack of
measurement means these funda-
mental building blocks of your organ-
ization are not being managed nor
improved.
Considering wages, benefits and
training, what percentage of your oper-
ating budget is dedicated to person-
nel? One third, maybe more? How can
you afford to ignore exactly how this
asset is performing?Interestingly, according to the book,
Cracking the Value Code: How Suc-
cessful Businesses Are Creating Wealth
in the New Economy, by Boulton, Lib-
ert and Samek, only 35 percent of exec-
utives who expressed a belief in the
importance of investing in their
employees actually walk the talk.
Failing to measure the intangible
drivers—LCT—can cost a company its
competitive advantage. Too many exec-
utives become lulled into a false senseof security by merely implementing
standard industry measures. The flaw
in this strategy: If you only measure,
manage and improve the same items as
your competition, you will not differ-
entiate yourself. Use LCT to your
advantage to ensure that your compa-
ny ends up on top.
The OrganizationalDrivers of LCT
Whether you notice an increase inemployee mistakes, a decrease in cus-
tomer satisfaction or a drop in reten-
tion, the root cause can be attributed
to the quality of leadership at all levels
of the organization; the effectiveness
of internal communication; or the
ability of employees to work well
together.
More specifically, the cultural chal-
lenge results from a combination of all
three drivers due to the synergistic rela-
tionship among them. Envision three
concentric circles, with leadership in
The measuring cycle begins by measuring leadership, communication and team-work to create a benchmark from which to track your progress. You then must work to understand the meaning behind the resulting measures and their impact on
performance. Then, share the information and its meaning with the entire organization; work collaboratively to tackle organizational challenges at the root, not superficially at the symptoms; and, finally, remeasure and begin again.
M E A
S U R E
U N D E R S T A N D
S H A R E
W O R K
R E -
M E A S U R E
THE
MEASURING CYCLE
the outermost circle surrounding and
impacting communication, which
influences the inner circle of team-
work. While it is possible to isolate each
intangible for the sake of conversation,
in practice it proves impossible to dis-
entangle them.
Consider this story about a compa-
ny CEO working with an independent
consultant to increase productivity.
One day the CEO and consultant spied
an employee raking the company’slawn using a rake with only seven of its
12 tines. Obviously the employee’s per-
formance was poor, leaving behind a
considerable amount of leaves.
The CEO became enraged and
asked, “Why would a supervisor allow
an employee to work with such a poor
rake?” The consultant replied, “Are you
sure the supervisor is the only one to
blame? To which the CEO answered,
“No, of course not, you’re right—it’s
my fault for not ensuring that all super-visors understand that the company
strongly emphasizes the importance
of their employees having the proper
tools. I will meet with my managers
this afternoon to make sure they under-
stand that.”
To the CEO’s surprise, the consultant
pressed further. “Isn’t there someone
else who should take some responsi-
bility?” The CEO shrugged her shoul-
ders, not sure who else might be at
fault. “What about the employee?” sug-
gested the consultant. “Where is the
32 MetalForming/August 2011 www.metalformingmagazine.com
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employee’s responsibility to make sure
he has the right tools?”
Creating a Strong CultureThe short parable above illustrates
how LCT impacts performance. The
consultant guided the CEO toward a
cultural model described any number
of ways: innovative, high-performing,
one with shared management, or one
that provides for employee empower-
ment. With a slight variation in empha-
sis, all of these models productively
blend the company’s intangibles—
LCT—to create a strong culture that:
• Is greater than any one individual;
• Is aligned along a common purpose;
• Values multidirectional commu-nication;
• Holds individuals accountable for
their own behavior;
• Encourages new ideas and accepts
constructive criticism; and
• Builds leadership at all levels,
ensuring that it will never be without a
next generation of leaders.
But other than by anecdotal evi-
dence, how do you know when you
truly have established the business cul-
ture as intended? By introducing meas-urement into the sustainable-culture
equation. Strategically, you must pro-
vide proof; you must measure. Like the
CFO who can share profit-growth fig-
ures through measurement of revenue
and expenses, and the COO who can
discuss the drop-in widget output as
the result of counts, LCT must be quan-
tified for two reasons:
1) Companies only value what they
can measure. “The unmeasured must
be measured, for if it cannot be meas-ured, it isn’t considered of value,” notes
Debra Amidon, CEO of Entovation Intl.
Ltd., Wilmington, MA.
2) While a company’s financial,
operations and marketing efforts are
routinely included in its strategic plan,
talent management and the strategies
for developing the personnel required
to implement the strategic plan often
are absent. Without the proper people
having the proper skill sets in place, a
company’s strategies will not be
implemented.
Measurement in and of itself will not
sustain a culture. Measurement is an
invaluable indicator of the direction
in which a company is headed and the
trends being experienced. In fact, if
measurement is viewed transactionally
and exclusively as a number, the most
valuable component will be missed:
the information that can be garnered
and used to create sound actions.
The Measuring Cycle…consists of these six steps:
1) Measure leadership, communi-
cation and teamwork to create a bench-
mark from which to track your
progress.
2) Understand the meaning behindthe resulting measures and, above all,
their impact on organizational per-
formance. For example, what are the
consequences to the organization if:
• Your employees report a percep-
tion that the leaders are playing
favorites?
• Your workers lack the information
they need to do their jobs?
• The existence of silos prevents
cross-departmental teamwork?
3) Share the information and its
meaning with the entire organization,
because engagement increases when
the larger picture becomes clear.
4) Work collaboratively to tackle
organizational challenges at the root,
not superficially at the symptoms.
5) Remeasure. Use the benchmark
from step 1 to quantify your progress.
6) Repeat the cycle of strengthening
leadership, communication and team-
work with each iteration.
Gaining control of leadership,
communication and teamwork will
bring significant savings, as absen-teeism is reduced, time spent on per-
sonal conflict drops and turnover
decreases. These savings will be aug-
mented by a quantifiable improve-
ment in employee engagement, inno-
vation and trust, all of which have
been documented to provide signifi-
cant increases in revenues. MF
www.metalformingmagazine.com MetalForming/August 2011 33