Playing To Win
Measuring, Managing & Mattering
Friend and frequent story idea contributor Brendan recently asked me about a quote attributed to Peter Drucker concerning measurement and management. I thought it would make an excellent piece because the topic is indicative of a broader phenomenon. So, my 43rd Year III Playing to Win/Practitioner Insights piece is on: Measuring, Managing & Mattering: Don’t Let Your Strategy be Guided by Fictions. You can find the previous 153 PTW/PI here.
The Quote in Question
The quote Brendan asked about was: If you can’t measure it, you can’t manage it. This is, of course, a very strong assertion on measurement in the world of business. It is not at all ambiguous. It is not nuanced. If you can’t measure something, there is no way, no chance of managing it. Just throw up your hands in resignation. Focus on the things you can measure.
The presumed veracity of this nostrum, this management rule, is a huge boon to all the aficionados of Objectives & Key Results (OKRs — about which I have written previously) and Key Performance Indicators (KPIs). They want to spend all their waking moments measuring measurable stuff and giddily ignoring everything else.
If you can’t measure it, you can’t manage it has ensconced itself as a part of modern business theology. It would certainly be handy if it was truly valid. And it would be a bit of a shame if it was just plain wrong, given that we have organized modern management around the concept.
But fear not, its proponents quote none other than Peter Drucker, the greatest management thinker of all time, as the source of this important piece of managerial wisdom. In fact, according to the archivists at the Drucker Institute, which was established by the fans and followers of Drucker to help people best utilize his teachings, it is one of the quotes most frequently attributed to the great man.
The most frequent one is culture eats strategy for breakfast. Because both quotes are attributed so frequently to Drucker, the archivists decided to do an exhaustive search through all his writings and his speeches to see when and in what context Drucker penned and/or spoke these words. It turns out there is no evidence whatsoever that Drucker ever wrote or spoke the phrase culture eats strategy for breakfast, which I have also previously written about.
At this point, you can probably guess where this is going. Yup, the exact same holds for if you can’t measure it, you can’t manage it. Nothing. Zilch. Nada. Or anything close. There is no actual association between Drucker and if you can’t measure it, you can’t manage it.
Ahh, but take heart, the quote is also widely attributed to W. Edwards Deming, who is also on any thinking management person’s list of the top five management thinkers of all time. He is the father of total quality management — and arguably savior of the US auto industry. He was a huge proponent of statistical process control — so a measurement guy at heart.
The Deming Institute indeed has been able to confirm that he actually published those words in his 1993 book, The New Economics for Industry, Government and Education. But before we get too excited, let’s go to the exact quote from the guru: It is wrong to suppose that if you can’t measure it, you can’t manage it — a costly myth. (My highlighting added) Whoa, wait a minute. Yes, he wrote those words — but in a sentence constructed to convey exactly the opposite.
That would be like me writing: “In the early days of his rise to power as Führer of Germany, many Germans thought Hitler was a great leader, but in due course, he got millions of those same Germans killed, and tens of millions from other countries, in a lost war, during which he orchestrated arguably the most horrific genocide in human history, and cemented his legacy as one of the most evil and reviled dictators in the history of the world.” In similar fashion to Deming, I could get quoted as holding the view that “Hitler was a great leader.” Those would have been my words — but taken totally out of the context of a sentence that said exactly the opposite.
So, with a closer look, it becomes clear that the entire moral authority of if you can’t measure it, you can’t manage it is completely fictional. It has been repeated by historically inconsequential people who want folks to believe it and use Drucker and Deming to buttress their advocacy.
A Fictional Counterpoint
Interestingly, the opposing point of view is also buttressed by another fiction. Albert Einstein has been quoted widely having declared: Not everything that can be counted counts, and not everything that counts can be counted. Nice sentiment from one of the greatest scientists to have ever roamed the planet! But there is zero evidence that he ever said it, and that is exposed by the fine folks at Quote Investigator, whose work I love and highly recommend.
The true author was sociology professor William Bruce Cameron who wrote the phrase in his 1963 book: Informal Sociology: A Casual Introduction to Sociological Thinking. I like his point very much. He was a consequential professor who wrote sensible stuff for regular people — including that book. While he makes a good point, he isn’t Albert Einstein, or Peter Drucker or W. Edwards Deming for that matter. He was a full professor at a US university, of which there are currently 190,000 (and another 330,000 associate and assistant professors), meaning that about one in every 2000 Americans is a full university professor. So, being one is notable but hardly rare. It is as common as being a psychologist, a social worker, a bill collector, or a human resources manager.
Even though I happen to agree fully with Professor Cameron, his status alone as one in 2000 Americans in a lofty profession does not suggest that he is almost certainly correct.
We Need to Knock it Off!
We can’t keep quoting historical intellectual giants on things they either never said or said the opposite just because we wish they had said the thing. A CEO whose company I was involved in was famous for repeatedly quoting Drucker (falsely of course) that culture eats strategy for breakfast. Why? He was terrified of strategy because he was clueless on the subject. Eventually the board had to fire him because it couldn’t get him to produce a coherent strategy for the company. I guess in this case strategy ate a CEO for breakfast. But it serves as a great illustration that it is dangerous to misquote a great thinker because you wish the misquote was true. You will start believing a lie and that is hazardous.
Measurement, Managing & Mattering
On this particular front, my reasoning lines up with Deming and Cameron. Not only is it possible to manage without measurement, but it is also necessary because indeed not everything that counts can be counted. I agree that it would be handy if everything important was quantifiably measurable. That would make management easier. But it isn’t the way the world works.
I would argue, however, that everything can be measurable in some way — just not quantitatively. Quantitative measurement flattens the object of measurement down to simplistic dimensions. EPS measures profitability — but in a simplistic way. NPS measures customer satisfaction — but in a simplistic way. The business world has accepted this imperative for simplistic evaluation because of its obsession with measurement. But it produces a very low-resolution understanding of the thing in question.
That is why I have always argued that if I had a choice between a CEO spending an hour each with ten customers or the company doing a 10,000-person quantitative survey of customers, I would choose the former every time. That is because the latter requires every piece of information to be flattened down into its most primitive form — e.g., a five on a seven-point scale. Sure, the results will be statistically significant — but it will often be statistically-significant rubbish. Because the CEO can interpret the multidimensional nuances of the customer in a deep face-to-face conversation, those interactions will produce deeper understanding, despite lack of statistical significance.
As I have argued before, for many things in business, the price of flattening down the dimensions of an element in order to measure it quantitatively is too high because it produces statistically significant nonsense. In such cases, you have to build the sophistication of your qualitative appreciation to make meaningful distinctions in the characteristics of the element. That is required when you are questioning elements like customer dedication, enthusiasm, appreciation, even love. You can create moronic ways to measure each quantitatively. But you won’t be happy at all with the results — and neither will the customers.
I added the Satchel Paige quote, the only correctly attributed one, purely for fun. For non-baseball fans, Paige was an African American baseball pitcher, who was forced to play the most of his career in Negro Leagues Baseball (NLB) before Jackie Robinson and the desegregation of Major League Baseball (MLB) in 1947. While NLB didn’t keep accurate stats, the unofficial stats would put Paige among the top handful of pitchers of all time — and arguably the best. At the ripe age of 42, Paige was finally allowed to pitch in MLB — and, despite being in his twilight years (for context, only one active pitcher in MLB currently is older than 42; he is 43), was named an all-star in multiple years, was the first African American to pitch in a World Series game, and was elected to the MLB hall of fame.
And he was a proverbial quote machine. In addition to the beautiful one above, he argued: “Age is a question of mind over matter. If you don’t mind, it doesn’t matter.”
The most basic practitioner advice is that if you are going to let yourself be influenced by a quote from a famous person, make sure the person in question actually said it. Go to Quote Investigator to check. It isn’t hard and it can protect you from much delusion.
At a more sophisticated level, the practitioner advice is to align your management approach to real life on the planet, not to some management nostrum. There is no substitute for thinking from first principles — even if all it does is reaffirm the wisdom of great thinkers like Drucker, Deming, or Einstein. If you can’t measure it, you can’t manage it isn’t aligned with the way the world works. I don’t think you can measure your dog’s love for you. But I think you can manage your dog. But I would argue that not everything that can be counted counts, and not everything that counts can be counted — like the love of your dog — does ring true in your real life.
A further way to distinguish is to ask whether the advice is absolute or contingent. The first is absolute: it is impossible to manage what you can’t measure. Some things in real life are that absolute. But not many are. The second is contingent. The key words are not everything. Sometimes when a thing matters, it can be counted, and sometimes not. This is the way the world normally works. You can generally count some things, but not all things.
Think, so that you can stand on the shoulders of real giants. Don’t blindly outsource your mind to fictional ideas that are falsely attributed to giants.