Payment by results and cheating

The above is narrated by John Seddon the CEO of Vanguard Consulting, which takes some of its ideas from William Deming, who is one of the earlier so-called ‘system thinkers’.

The above is referring to the public sector, however I think it applies to the world of marketing services too, probably any professional service in fact that is a complex sale, recruitment, estate agents, management consultancy, solicitors, accountants, SaaS and so on.

As soon as management makes people’s jobs / livelihood highly dependent upon hitting a target (often a moving one) the employee will often do what ever needs to be done to protect their income. And that will often mean cheating. As William Deming said “Whenever there is fear, you will get wrong figures.

Who can remember as a junior new business person fudging a status reports to show that you’d  found loads of so-called warm leads. It can’t just have been me, surely! Management caused that. There was little choice really –  kill or be killed. The last thing management wants is lies but they create the culture where it is imperative.

It’s not the final targets i.e. income or profits that are the problem but all the proxy measures that are shoved in place, that are supposed to somehow motivate employees. Be it numbers of meeting sets, number of briefs, number of tenders, number of pitches gained. It is similar to the digital world where people measure likes, or re tweets or eyeballs all of which can be very easily fudged to hit a target.  The target will always be hit even if it is at the expense of the enterprise.

Most agency new business programmes have no clear theory behind them. So there is no theory to improve on. Deming – “We should be guided by theory, not by numbers.

If you ask some owners of agencies what is their theory behind their new business programme they’ll look blankly or admit they do it like they always had – hit and hope – the numbers game.  And for some it must work, right? Who hasn’t ever been lucky?

deming workIf you ask a CEO if the quality of their product / service has improved over the last year, they will often say they don’t measure that. And to be fair that is not easy to do, however isn’t that closer to the heart of the problem? “3% of the problems have figures, 97% of the problems do not.”Deming.

Instead many businesses just manage figures, in particular targets, as if managing targets makes them more achievable. Or as if targets coincide with doing good work that solves the initial problems.

All anyone asks for is a chance to work with pride.” Deming. I think that is my point most people want to do good work very few people are free-loaders – it is failure of management to understand leadership that bring the best out of people and focuses on constant improvement.

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