Thursday, March 16, 2006

The most important figures are unknown or unknowable

One of Deming's paradoxical quotes is "the most important figures that one needs for management are unknown or unknowable. David Walker picked up this point recently in the Guardian with an article about how difficult it is to measure productivity in the service sector. For example (in the NHS) "measuring the cost is a damn sight easier than evaluating the output. Just counting the number of patients a consulant sees gives no scope for assessing the quality of the episode or illustrating the improvement that might result, in the long run, in their lives"
It's a problem in policing, too. "Officers on patrol are very unlikely to spot or stop a crime, which makes their productivity seem unimpressive. But a glimpse of a patrolling officer is highly valued by members of the public. They might still feel good even if they registered the "unproductiveness" of the officer in terms of detection of criminals.
Deming lists "Running a company on visible figures alone" as one of the Deadly Diseases of Management. "A company may appear to be doing well, on the basis of visible figures, yet be going down the tubes for failure of the management to take heed of figures unknown and unknowable".Posted by Picasa

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