Point 11 – Attribute Processes Results This point may be controversial, but it aligns with Deming’s philosophy nicely. I completely agree with this point. Management By Objectives (MBO), is the norm in the United States. Before I explain my view from an operational perspective, I will first relate this concept to project management. MBO is a process that establishes standards for an employee’s performance with the intent of evaluating their performance. Performance relative to the standard is a significant factor in merit increases, bonuses, and other factors. One example would be the handling times in a call center environment. If you take an average of 4 minutes to handle a standard handle time, it is considered that the employee is performing poorly. This management paradigm assumes that the employee is responsible for the measured metric (handle-time). This management philosophy has pros and cons.
- It’s easy to set expectations
- Easy to quantify
- It is easy to base performance evaluations upon
- Tends to shift the focus to?at? Standard
- There is no focus on process variability
- Tends to make the standard?only? Performance measure
- When the standard is being met, there is little incentive to improve processes.
- Operational leaders tend to favor lower standards when defining standards for fear of not meeting them.
- The ‘carrot and stick’ approach to motivating people. Fear is often the strongest motivator and wins out in this approach
- It is discouraged for educated people to take risks and experiment with processes. Temporarily
- Encouragement of internal competition that is detrimental to employees discourages employees from helping one another
- Employees are forced to attempt to achieve contradictory goals. (?I want great customer service and to spend the time the customers require, but if that is not done the right way, I’ll be fired.)
- Managers and employees may be motivated by the desire to make their numbers look better.
- Changes the focus from customer satisfaction to?covering your butt. ?
Management by Objectives is not something I like. It seems like the easiest way out and the wrong approach. Deming says that 90% of all defects can be attributed to ineffective systems or a lack thereof. People want to do a good work and will follow a process that is well-designed and allows them to contribute to its development and improvement. Let’s talk about how to estimate project tasks for cost and duration. In the MBO paradigm, each member of the project team is given a piece of work to plan and estimate. There is often no process that they can follow when making their estimates. The project manager assumes that they are the SME and can estimate. The PM may not have an idea of how much time they can devote to their project, in addition to other tasks or projects. Many times, an experienced member of the team will take on too much slack because they fear missing their deadlines. An MBO mindset will lead to everyone blaming others for their mistakes. It doesn’t require a focus on improving. What would a Deming approach look like? The Deming approach would have a process to guide estimates, assess performance against planned estimates, and then go back to correct any errors. Another option is to adjust the resource load so that a member of the team can dedicate all or most of their time for a limited time to a project. This will reduce the cycle time for their deliverables (for you and other projects) as well as allowing them to estimate more accurately in terms of effort.