JIM COOMBS. Counting.

Jun 7, 2018

If you can’t measure it, you can’t manage it.”  The mantra of the managerialist “economic rationalists” has led to oversimplification and oversight (in the sense of ‘failing to see’) of what actually matters: the real values involved in the work. 

The problem for them is that it is difficult to get instantaneous data on what constitutes effective action, as opposed to any action at all. So they manage on the latter. Which means that their “management”, from the beginning, has lost the point of what they are managing! Why, as Professor Julius Sumner Miller used to ask, is it so? Consider any worthwhile activity – how do you measure whether it does the job better, as opposed to quicker, cheaper? Assessment of Value (my capital V) is not something which turns up in the instance of a work moment even if, by serendipity, it should occur there. The counting of the event would, inevitably, be irrelevant.

Consider, as an example, the way in which large law firms charge their clients for “work done”: it is made up of 15 minute bits! Apart from making huge fee profits for the law firm, the fees bear little relation to the quality of the work done (in 15 minutes ?) and probably not by the junior solicitor whose time is so “costed”.

Since time immemorial, leaders who have succeeded have been able to see the wood from the trees. The idea of counting the trees would not even have occurred to them!

To give another example, what about fees charged by surgeons? (A hot topic at the moment.) If a surgeon who does  ten plus hip replacements in a day may do very well charging the same amount for each. But a specialist dealing with complete leg reconstruction may take all day with great skill and yet not feel he can charge the fees of the colleague who churns out a technically uniform product ten times over the same period. How do we assess the value and complexity of a difficult task achieved? Well, counting the number of occasions of a broad category clearly doesn’t. Yet that’s what the business school people do. If you oversimplify, you don’t have to make difficult value judgements.

This craze has led to a huge “industry” of evaluation. Rather than informed opinion operating on work done, large numbers of staff are set to look at “data” after work is done. There are huge numbers of public servants who only do this rather than deliver the services their departments are supposed to. Worse, “consultants” are brought in as well, business school graduates with NO knowledge of the task at hand who begin their task by counting instances and not the reason for them or what might be regarded as successful outcomes, which are clearly matters beyond their competence.

The current problem with the banks is that “managerialism” has focused on the “countable” charges and profits, and ignored the purpose of banking, the quality of the service they provide to their customers. In days gone by, local bank managers made value judgements about the worth (both financial and fiduciary) of services provided. With the advent of the David Murrays of this world, no such proper judgements were to be made.

Is it too much to ask that decisions about serious matters be made by managers who are informed by values above and beyond the mere counting of instances and profit outcomes?

Jim Coombs is a nearly retired magistrate and adherent to value-based decision-making (and qualified economist!).

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