Apr 24 2015
What Is The Metric For People Development? There Isn’t One
Contrary to popular opinion, it is not true that only what gets measured gets done. If it were, business, government, and society at large would come to a halt due to the damage done by metrics gamers, and for the lack of the contributions made by people who do not care whether they are measured. Deming is often quoted on this subject, as saying:
- “It is wrong to suppose that if you can’t measure it, you can’t manage it – a costly myth.” (Deming, The New Economics. p.35)
- “People with targets and jobs dependent upon meeting them will probably meet the targets – even if they have to destroy the enterprise to do it.” It is cited on Brainy Quotes, but without a source, and it may be apocryphal.
As he showed in his “red bead experiments,” his primary concern was about people being rewarded or punished based on random fluctuations in metrics that have nothing to do with their talents or efforts, but there are even more fundamental challenges in an area like people development.
You can measure how much dirt you have shoveled by weighing it, but developing people is different. There is not even a single direction. Some individuals are “hedgehogs,” who know one big thing like heat treatment, while others are “foxes,” who know many things like all the technical and human moving parts of a production line.
There is no metric– or even set of metrics — that can reasonably summarize people development, but it is nonetheless tangible and observable.
The following pointers give you ways to assess the extent to which it is taking place:
Signs of Lack of People Development
There are indicators that people development is not taking place. If you have an employee turnover of 30%, it means that only 70% of today’s new hires will still be in the organization in 1 year, 49% in 2 years, and 17% in 5 years. Whatever the other 83% learned walked out with them to benefit other organizations, and the only people development that takes place is basic training. On the other hand, an employee turnover of 4% is no guarantee that learning and growth are taking place. 82% of the hires stay at least 5 years, but, unless management is paying attention, it may be years of repetitive, mind-numbing routine, with all their personal development taking place outside of work.
When reviewing metrics like turnover, you must always ask “Compared to what?” The numbers are relative to the organization’s environment. The Mexican maquiladoras along the US border and the factories in the Pearl River delta of China have a workforce that is dominated by girls from the countryside who come with the goal of making money for a couple of years and return home. In such a context, a turnover of 11% is a sign that management goes out of its way to retain the workers. In the US Midwest, or in Japan, the same figure would be abnormally high and signify the opposite.
The seniority distribution gives a more complete view. Unless the plant is new, the work force should not be entirely under two years of seniority, but you have another problem if everybody has been there 20 years of more, because it means that no renewal is taking place, and retirees will have no one to pass their knowledge and skills to. Either management does not plan for this organization to have a future beyond the current generation, or it has failed to plan for succession, which is also part of people development.
Other indicators worth considering are absenteeism and safety, again, in context rather than in absolute terms. Absenteeism is partially determined by external factors, such as the level of child or elder care available to working parents, and the health care system. If, however, absenteeism is meaningful if high compared to other organizations in the same environment. Unsafe working conditions are also a sign of management indifference and incompatible with people development.
Human Resource Policies for People Development
Digging deeper, you find Human Resource policies on such subjects as:
- Multi-skilled operators. Where operators are expected to acquire multiple skills and be able to fill multiple positions, they are systematically rotated and certified at increasing levels of proficiency, reflected in a skills matrices posted on the shop floor, on team performance boards. It expresses the goal that every member of every production team should be to perform any of the team’s tasks. It is, however, always a work in progress, as top members are promoted out of the team and new ones come in.
- Rotation of professionals between departments. In most companies, professionals are recruited to fill a need for a specialized skill, and their next career move is to another company with the same need. Other companies hire professionals for their executive potential and groom them by systematically rotating them on multi-year assignments through multiple departments and locations. Ayoung German engineer works as a production supervisor in an Italian factory, and the project manager in charge of implementing new production control software has spent five years in product design. The existence of such a system does not guaranteed its effectiveness. It depends on how it lives and breathes. It can grow outstanding, well-rounded leaders, but it can also degenerate into a formalism in which individuals just serve time on assignments, careful not to make waves that might jeopardize future promotions.
- Training. This ranges from obligatory briefings on how to put personal protection equipment to support for employees pursuing PhDs. In principle, obviously, companies invest in training to develop their people, but their motivations are not always that clear. In France, for example, a legal mandate for companies to spend in training has resulted in just that — spending — and the mandate has spawned a whole industry offering bogus or irrelevant courses. You need to look at what the actual training system consists of and how it is perceived by the work force.
Recognition. Companies that develop their people recognize their achievements in both tangible and symbolic form. If you want production operators to learn multiple skills and track their progress on skills matrices posted on the floor, you should also base a fraction of their wages on the number of different jobs they are certified for. That’s tangible recognition, which should be supplemented with symbolic recognition, which may take different forms in different cultures. Americans respond well to plaques, but not everybody does. This ranges from “Employee of the Month” to patent walls, like the one that was removed from Tesla headquarters when it made its technology open-source. In Japan, Nippon Steel honors the most senior shop floor employees with the title of “Waza no Tetsujin” (技 の 鉄人) or “Iron man of skill.” It comes with a distinguishing mark on the employee badge that invites junior workers to seek advice and guidance.
- Career planning. If you want to develop and retain people, you need to give them a career to look forward to, and it takes planning. Biyearly reviews must not only give feedback on performance, but also include discussions of career goals and of the steps necessary to reach them. Large American corporations used to do this for their professional staffs, but no longer do, which is revealing of their managements’ approach to people development. The Toyota Production System, on the other hand, includes career planning for production operators.
The Role of Continuous Improvement
In addition, developing people is a key objective of continuous improvement activity, on a par with directly enhancing performance. On the shop floor, you can see the results in the form of details done in clever ways and homegrown fixtures or machine retrofits, as explained by the people who conceived and built them. And you can also see the traces of failed efforts, for example when a manager tries to show you the effects of a Kaizen event conducted two months ago and discovers that all the changes have been reversed.
Beyond the words you hear, you also need to read the blunt body language of the shop floor. Manufacturing people are not bashful. If they are engaged and feel they are growing professionally, it shows in the enthusiasm with which they share their accomplishments; if not, their short answers and sullen looks leave little doubt.
April 24, 2015 @ 9:51 am
“There is a reason why No Man’s Land is empty…”
I did a quick statistical analysis on the PayScale Fortune 500 employee tenure durations. I came up with a Median Employee Tenure of 3.8 years. That means the Survival Rate is 83.5% per year or an attrition rate of 16.5% / year!
Anecdotally, my colleagues and I seem to encounter a leadership that apparently behaves as if it doesn’t care to do what’s needed to reduce turn-over.
In a “left hand not knowing what the right hand is doing”, apparently, that same leadership complains about it being hard to find IT talent. I’m missing something…
I’m puzzled as to why big American corporations have apparently stopped offering any meaningful training, nor any real career development support for their staff. I mean, the shelves are full with Employee Engagement literature, and the business schools publish countless articles every month on how to better treat your employee, yet, nothing real is done by leadership. I could think of some reasons, but wonder if there are any studies providing more information.
April 26, 2015 @ 7:39 am
Comment on LinkedIn:
April 28, 2015 @ 2:55 pm
People grow more when they are valued, rather than evaluated. “Somethings that can be measured don’t matter, and somethings that matter can’t be counted.” Albert Einstein. —
There are three ‘ologies’ needed to effectively run any organisation. The first two, technology & methodology receive most of the attention. But is the third, PEOPLEOLOGY, which is the key to long term success & the development & use of the first two. Peopleology involves releasing & focussing all our people’s abilities. Ability has three dimensions; 1) Talent, the ability to do existing tasks well. 2) Creativity, the ability to improve what we do & the way we do it. 3) Enthusiasm, the emotional ability/energy to do the first two. —
In the hands of enlightened management teams this combined ability becomes an awesome weapon to wield on the global battlefield. It is the lever with which an organisation can lift its performance to world class levels. I find that many improvement programmes are missing this vital element & cannot sustain long term success. —
I get annoyed that we keep discussing the value of people in the TPS/Lean process. If we can paraphrase Mr Clinton, “It’s the people stupid!”
May 5, 2015 @ 4:05 am
Michel, my two cents:
No one has mentioned gamification. From what I’ve heard, Zappos uses “Levels” in their company to great effect, where a team-mate starts with the company and “levels up” as they learn more tasks. Apart from the status gratification (it might seem silly, but it’s there), a small pay increase is involved – and to be promoted from within you must complete all the levels for the current role.
It’s a beautiful, positive use of human psychology… although, like all things, it can be misused.
Top Quality Blogs (June 2015) Quality At Work
July 1, 2015 @ 9:55 am
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April 16, 2016 @ 8:57 am
Turnover is of course of a multivariate result. We have the joining up process, the learning curve, and the management environment. By looking at when employees leave and what strata of people leave, we can begin to focus in on root causes. In one bank I worked with, it was the people on the learning curve (about the first 4 months of employment) that had the highest turnover, as well as the associates in a recent acquisition of a smaller bank. This brings up another point, we need to distinguish functional from dysfunctional turnover. There are plenty of legitimate reasons why people leave the company that need to be extracted from the general turnover data.
But let’s get back to training and development. First, training. Time to competency in the existing job is the most important metric. We can operationalize this as “associate can produce both normal and off normal job outputs to standard, without supervision”. There would be an actual performance test so that the employee can be certified in the particular job output.
Now, on to development. If the outputs of all jobs are properly defined, and this information is accessible to employees, any employee may begin to qualify themselves for a lateral or upward move in the organization. This need not cost millions of dollars and thousands of lives, in many cases the employee can pursue the requisite skills and knowledge on their own time. Accurate job performance aids can also be studied. Checklists can be offered so that the employee can evaluate the sufficiency of the job output in question.
The training department can keep records of job output certifications for the associates. If these are not immediately a part of a job transfer, there may be a requirement for recertification, say, after a year. All that need to be done for the certification is the manager of the area with a checklist. If the employee fails the performance check, the manager provides feedback, and the employee is welcomed to try again after a week.