Harvard Business Review

When Scorecards and Metrics Kill Employee Engagement


Posted on Harvard Business Review: July 12, 2011 9:23 AM

Staff Sgts. Fred Hilliker and Robert O’Hair were boarding Delta Flight 1625 in Baltimore for the final leg of their journey home from Afghanistan with 32 others in their U.S. Army unit when their homecoming came to an abrupt halt. Delta personnel told the soldiers they needed to pay $200 for each person that had a fourth bag with them, even though their military orders stated that these bags were covered.

Unable to gain resolution with Delta, the two Staff Sgts filmed a YouTube video about the incident. The story generated considerable buzz for an obvious reason: What Delta did to these soldiers was wrong. I’m fairly sure that the Delta employees who were demanding payment knew it. So why didn’t they just waive the fees?

The Delta situation could be dismissed as an unfortunate case of miscommunication if it didn’t seem so familiar. It highlights a trend in management that favors the fulfillment of quantifiable, top-down metrics. I’d bet that you’ve had an experience dealing with customer service where you were told that there was no one else you could talk to and no one was authorized to take the necessary action to resolve your complaint. As psychologist Barry Schwartz has observed, many areas of life are increasingly bound up with rules that limit the ability of individuals to use judgment and make the best decision for the specific situation.

It would be wrong to place all the blame on workers for their failure to take discretionary steps. The blame lies with management that sets rigid rules and metrics that disable employee judgment and create so many approval hurdles for mundane decisions, that overworked employees say, “Why bother?” Employee disengagement has reached crisis proportions as evidenced by a recent Mercer study that found that 50% of employees are checked out on the job.

It’s not hard to see how we got here. Performance metrics are a critical tool for achieving excellence and motivating outcomes. But as important as performance metrics are, problems arise when performance metrics become overly dominant as a managerial principle, as they are in too many organizations.

Metrics earn an outsized role because managing by the numbers is easier than managing people. Employees make mistakes, their actions are difficult to predict, and the outcomes of their decisions are hard to measure. When employees make wrong judgments the resulting mess, in terms of customer satisfaction and legal liability, can often be difficult and expensive to clean up.

Rules are comfort food for management. When something goes terribly wrong, the first response is to add more rules and policy. Of course, managers have good intentions: protecting the company from bad choices and creating accountability. That’s what everyone learns in Management 101. Yet the net effect often shifts accountability to the wrong places. Unassailable rules and metrics shifts accountability away from management and down the chain to the front-line employee. Rules allow managers a surefire way to dodge their responsibility and protect their career.

The blame for poor employee action should be placed on the managers who set rigid metrics, and fail to invest in employees. Yet customers need more judgment, not less, from the employees they come in contact with. When customers contact a call center, it’s because there is an exception within the existing process and they need judgment that only employees can provide. Corporations need to build guidelines and values—not absolute rules and measures. “Doing what’s right for the customer” is a value that can drive appropriate action. Judgment requires coaching, practice and training.

Metrics, policies and scorecards are not bad per se. There are many benefits when used appropriately. The pendulum seems to have swung too far away from employee judgment, though. Let’s bring it back in balance. Invest in your front-line employees and then trust them to make the right decisions for the customer. Otherwise you’ll be managing a group of automatons who, when confronted with situations outside the rigid rules, will be virtually guaranteed to make the wrong judgment.

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