Business Sutra |6| Measurements
We have covered five episodes of Devdutt Pattanaik’ TV serial on CNBC 18: Business Sutra.
The 1st episode presented to us the most visible form of the business – the corporation: its meaning, its purpose and its action perspective. In the 2nd episode Devdutt Pattanaik discusses Leadership: Role of the leader, Context of the leader and Leadership in different business cycles. The 3rd episode relates to the Business Ethics and Morals: business ethics and dilemmas, relationship between owner and the organization and The Right (Dharma) – the Ramayana way and the Mahabharata way. The 4th episode deals with Conflicts, of the Board and the CEO and that of the means vs. ends. The 5th episode takes unto the realm of Education, wherein Part 1 covered the basics of education to the (potential) leaders in Ram’s Education, Part 2 addressed the Knowledge Transfer to Next Gen and Part 3 dealt with the issue of student motivation.
The 6th episode has taken up the oft-discussed topic of ‘Measurement’, wherein in the Part 1, What Can Be Measured, deals with the definitive need for not ‘only measurement’, but for ‘also measurement’ too.
Business Sutra |6.2| Objective versus Subjective Reality
The western literature of modern management is rich with the subject of measurement management, covering contextual definitions, measurement technique , pros and cons etc.
We have chosen a very brief peek into this huge volume of information.
Difference Between Objective and Subjective would help lay the foundation.
Stacey Barr, a Performance Measurement Specialist, in her one of the articles, Are Your Performance Measures Objective or Subjective?, puts the difference across as: ‘Objectivity means that a measure is not biased or prejudiced by a person’s feelings or opinions or perceptions or mental filters. An objective measure is as close to fact as we can get. Objective measures are like kale and blueberries for our decision-making diet. Super nutritious….But when measures lack objectivity, we call them subjective. This includes hearsay, opinion, data from very small samples (like a sample of one!), data from ambiguously asked questions, data from hand-picked samples, and assumptions or guesses. Subjective measures are like hamburgers and ice-cream for our decision-making. Junk food.’
Therein lays the apparent dislike for the subjective measures.
There is also ample literature, covering different industries, that also discusses about bringing in objectivity in the subjective measures.
The debate still goes on, and in all likelihoods, will continue to go on as well.
So, we turn over to Segment 2 of the episode 6 wherein Devdutt Pattanaik takes up the subject of Objective versus Subjective Reality. It may please be observed from the words and tone of the opening lines that the present episode is in seamless continuum of the previous episode.
I get the conversation about not ‘only measurement’ but ‘also measurement’. But how do you propose that we do away with a large amount of the measurement that are that currently exists in the system? When we’re small organizations of 5 10 15 people, you can make the measurement more subjective, less objective, bringing the human element, human interaction, one-on-one communication etc. But when you’re dealing with large organizations, when you’re dealing with organizations that employ 50,000, 1 lakh to l lakh people then some part of that measurement does have to get systemized, because that is the only way to standardize. Because that is the only way you can measure at that scale.
Big or small, organizations are about people. Every organization is built on teams. It is a simple HR practice that a person should not have more than five or six people reporting to him. So, ultimately it is about five or six people teams that build up so large organizations. So what you have is a measurement of these five people by the boss. We also agree that 50% of these measurements will be objective – quantitative and that the rest of 50 % will be subjective, qualitative. We also agree that the leader will be biased no matter how many auditors you get in. This means that I have to work on him to strip him of bias, to bring in more integrity in his behavior. This also means that it is not just about measurement but it is also about investing in people such that his subjective call is good enough.
We generally say that too much of energy is being wasted on investing in people, so better invest on a system. A subjective measurement would want somebody to pay attention to human beings inside. The System – process is about removing this attention. Attention is about relationships, it is about people having integrity. But, I can’t guarantee integrity. I have a process and a system and a method it is not necessary to give attention and I will come to the truth.
I’m not even saying that. But look at this:
- I have a large number of people, and
- that the measurement is subjective.
Therefore, when you have a human being doing the measuring, that human being may come to the table with his or her own prejudices, and therefore, measuring the other person’s performance output through the lens of that prejudice. So maybe a system not only allows me to deal with a larger number of people be also to some extent standardizes the communication and therefore eliminates to some degree the prejudice that a human being may bring. I am not saying systems are perfect, because even human beings are not perfect.
Today the other culture is to replace human beings with systems. That seems to be the mindset, because objective measurement is all that I need. Subjectivity is being withdrawn, the need for attention required is being withdrawn. In other words, we need both – ‘also measurement’ and not ’only measurement’. That is the shift which I’m asking for.
That results in uncertainty..
That WILL result in uncertainty.
So, how do you get away from that uncertainty, because in an organizations everything is driven to a fair degree of certainty – what are you going to earn next quarter, what are you into our next year, how are people going to perform, do you have enough people on the bench? Everything is driven towards certainty.
We can measure only some things, but the universe is infinite. The measurement is finite. The possibilities are infinite but measurement will always be finite. Talk to the entrepreneurs. Did they create the business based on measurement? Usually they use the measurement to validate their gut feeling.
The gut feeling is Kama, the god of desire, the god of lust, the god of instinct. Then comes the god of death, Yama, the god of measurement. So the measurement comes second, gut comes first.. The second one validates the first one. Overreliance of Kama cannot work, he is irresponsible, and he holds the bow in his hand and keeps shooting the arrows of wishful thinking all over the places. You need to restrain him, So Yama holds in his hand a lasso to restrain him. Too much of restraint and death will happen; too much of Kama and there will be complete chaos. So the question is how do you balance between the two and that is where the human element is critical.
When we talk about systems and processes in the extremes, we seem to aim to do without human beings. That is a very dangerous thought to happen, because what are organizations for if not about people.
So, if the western school tends to believe more in striking maximum objectivity in the subjective measures, Indian Mythology seems more inclined in retaining the essential touch of human element in the full scale efforts to bring in the objectivity in measurement processes and systems. This is where the first episode also had ended – not ‘only measurement’ but ‘also measurement’.
In our continuing journey of Devdutt Pattanaik’s TV serial Business Sutra, we will move on to the 3rd segment of the 6th episode – What Are You Worth?, in our next episode.
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