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Individual Performance Measures June 26, 2009

Posted by Tim Rodgers in Management & leadership, Process engineering.
Tags: , , , , ,

I’m generally not in favor of trying to set up a metrics program that attempts to measure and rank individual performance. One difficulty lies in the fact that no two jobs are exactly alike, particularly in knowledge-based businesses. I suppose if you were managing a factory that produces widgets you could theoretically measure the number of widgets produced per hour by a person, making sure to account for scrap and rework, but I’ve never seen a production line staffed by a single person. Today’s organizations have responsibilities divided, and specialized, and typically unique to each individual. To make things even more challenging, the boundaries between individual jobs are fuzzy, sometimes deliberately so. It can be hard enough to isolate and unambiguously measure the performance of a business or department or work team, and even more daunting to devise a scheme for measuring individual performance that enables each person to feel in-control and accountable for their results.

I hope this isn’t going to be confusing, but now I’m going to take a position that sounds contradictory. I think there are circumstances where measuring individual performance can be extremely valuable to the organization. Here’s an example.

Some years ago I managed a team of software testers. You might think the output from a software testing organization could be measured by the number of defects they report, but I would argue that the output is information, and the information from a passing test may be as valuable (or more valuable) than the information from a failing test. The danger in using “number of defects” as a measure is that team members are explicitly encouraged to report more defects, regardless of the business or customer impact of a defect. Each defect requires incremental engineering and management time, and that obviously adds development time and cost. I wanted to look at the “quality” of the defects reported by the team, and I decided that a defect that led to a code change (and ultimately fixed) was a high-quality defect.

This led me to look at trends in code-change-defects, or CCD. Here’s an excerpt from one of my e-mails at the time:

“I don’t want to turn this into a process for ranking people, but if we see two technicians in the same group doing roughly the same kind of testing, and one has much lower hours/CCD or a much higher percentage of CCD for all defects found, we should ask ourselves why. My first inclination is to blame our training, or how we communicate our values, or how we prioritize our work assignment, NOT to assume that the individual technician is incompetent. If I see a technician has spent X hours of testing and none of the defects they reported got closed due to a code change, I’ve got to see this as a failure of some kind.

“That being said, there’s no question that some testers are ‘better’ than others. What does ‘better’ mean? Why are they ‘better’ than others? Is this something we can teach other technicians? If it is something we can teach, shouldn’t we try? That’s why the numbers are important. Qualitative ‘engineering’ judgment should always be paramount, but the numbers add to the overall picture.”

This comes back to the point I made in an earlier post: performance measures don’t necessarily answer questions, they help managers ask better questions. Differences in individual performance are not necessarily due to the skill or motivation of the individual, but that doesn’t mean that we shouldn’t measure individual performance or ignore the results. The numbers add to the overall picture and help us understand what’s going on. I think the danger is in using these numbers as the sole basis for differential rewards.



1. Baseball and Measuring Individual Performance « Managing in the 2000s - October 4, 2012

[…] the performance of individuals and teams. I wrote about this in an earlier post in 2009 (see Individual Performance Measures). Team performance can be judged by examining their accomplishments and contributions to strategic […]

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