The tricky task of measuring managers

You are a manager; you want to know how you are doing. Other people around you are even more intent on knowing how you are doing. Especially if you are the chief executive. (If you want to know what you should be doing, you’ll have to read another TWOG, called “Celebrating the Flawed Manager.”)

There are lots of easy ways to assess how you are doing. Beware of them all. The effectiveness of a manager can only be judged in context. Notice: not just measured. This may sound easy enough, until you take it apart. Here we do so in seven subpropositions. (Bear with me—I’ll explain later why we need so many.)

(1) Managers are not effective; matches are effective. There are not so much good husbands and good wives as good couples. Well, how about managers and their units? There may be managers who fail in all managerial jobs, but there are none who can succeed in all of them. Success depends on the match between the person and the unit, in the situation at the time, for a time. Hence a flaw that can be tolerable in one context—even be considered a positive quality, such as a compulsive focus on cost reduction—can prove to be fatal in another. Thus (2) There are no effective managers in general, which also means (3) There is no such thing as a professional manager—someone who can manage anything.

Of course, managers and their units succeed and fail together. So (4) To assess the effectiveness of a manager, you also have to assess the effectiveness of the unit being managed. But not only that: (5) You also have to assess the contribution the manager made to that effectiveness.

Some units function well despite their managers, and others would function a lot worse if not for their managers. So beware of assuming that the manager is automatically responsible for any success or failure of a unit. History matters; culture matters; markets matter; even weather can matter. How many managers have succeeded simply by manoeuvring themselves into favorable jobs, making sure they did not screw up, and then taking credit for the success? (See the photo!)  

To further complete matters, (6) Managerial effectiveness also has to be assessed for broader impact, beyond the unit and even the organization. What use is a manager who makes the unit more effective at the expense of the rest of the organization? For example, sales sold so much product that manufacturing could not keep up, and so the company went into turmoil. Blame the sales manager? For doing his or her job? Shouldn’t general management be held responsible for managing the whole? Believe this, exclusively, and you may be part of the bureaucracy that has brought down so many organizations.

All organizations are flawed: unexpected problems can arise anywhere. Effective organizations deal with such problems in their own time and place, by whoever is best able to respond. No organization can afford to have managers put on blinders to do their jobs, refusing to look left or right.

Imagine if more organizations were to assess the performance of their units and managers together, with regard to their contribution to the whole. To repeat what I think cannot be repeated enough, a healthy organization is a community of engaged human beings, not a collection of detached human resources.

Moreover, what is right for the unit and even for the organization might be wrong for the world around it. For example, bribing customers may be effective for making sales, but is this the kind of effectiveness we want? Mussolini, the fascist dictator, was famous for making the Italian trains run on time.  In that respect, he was an effective manager. In others, he was a monster.

Put all these points together, and you have to ask: How can anyone who needs to assess a manager possibly cope with all this? The answer here, too, is simple—at least in principle: (7) Managerial effectiveness has to be judged and not just measured. (We’ll get to judgment in a later TWOG, maybe next week.) We can certainly get measures of effectiveness for some of these things, especially unit performance in the short run. But how are we to measure the rest? Where is the composite measure that answers the magic question?

If you think that so many points to assess managerial effectiveness is excessive, then think about the excessiveness of efforts that have ignored most of them. Think, for example, about executive bonuses based on measuring the increase in the price of the stock. The effectiveness of executives has to be assessed over the long run, but since we don’t know how to measure that, at least as attributable to any specific individual, executive bonuses should be eliminated. Period.

© Henry Mintzberg 2016.  Adapted from Chapter 6 called “Managing Effectively” of my book Simply Managing. Follow this TWOG on Twitter @mintzberg141, or receive the blogs directly in your inbox by subscribing here.