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Measuring and Managing Performance in Organizations Paperback – January, 1996
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Top Customer Reviews
The core argument of the book uses some mathematical reasoning that will be accessible to anyone who stayed awake through Economics 101. This is illuminating enough, but then Austin continues to add on additional insights.
I've placed this book on my shelf next to The Logic of Failure (Doerner) and Normal Accidents (Perrow). All of these books provide solid scientific arguments for the limits of management.
As a software tester, the most obvious application of the book is as an explanation of exactly when counting defects (found by testers, or introduced by programmers) is likely to lead to trouble.
He also assumes that an agent's job consists of two activities and the customer is happy if the agent performs well in both. Austin looks at the cases where the principal can monitor neither of the two activities, where she can monitor only one of the two activities, or where she can monitor both activities. According to the model the agent will behave differently in all three cases.
If the principal cannot (or will not) measure either activity, then we have delegated management, if she can measure both activities, then we have a fully supervised model, and if she can measure only one of two activities, we have a dysfunctional model.
When delegating management, the assumption is that agents want to work well, that they are not deriving maximum satisfaction by exerting the least amount of effort.
When supervising, the principal evaluates overall performance by measuring certain aspects of the agent's activity. Austin's conclusion is that measuring performance won't work unless you can measure everything employees should be doing (i.e. full supervision). Incomplete measurement is not only useless, it is dangerous since it motivates agents to make efforts only for what is measured.
For example, if a help desk line measures performance by the number of calls an employee takes, then employees are motivated to spend very little time per call.Read more ›
This book describes - the uses of measurement, informational vs motivational - a (increasingly elaborated) measurement model - an objective definition of dysfunction and how it arises because of measurement - a model of "supervision" and how measurement supports (or interferes with) various kinds of supervision - a suggestion about organizational incentives - some strengths & weaknesses of well known assessement systems; e.g., ISO, SEI - the interview method and answers applying the model with 8 well-known writers on software and software management issues.
The messages I got - setting up measurement systems is not easy. There are many pitfalls - picking the goal(s) that the measures will support is critical - picking the measures. Some things are too expensive to measure - deciding how much to spend - deciding what to report to whom - (to my own chagrin) that I had personnally and fully encountered most pitfalls - it's easy for those measured to subvert the measuring - partial measurement may make things worse - informational measurement (measuring and results stay with those measured) is less likely to be subverted - purely economic models are not fully adequate explanations of employee-employer relationships.
Most Recent Customer Reviews
I was evaluating this book as reading for my class in effective software business metrics. It is useful as a strong reference guide. Read morePublished 2 days ago by Hartwell
Finally, an evidence-based look at performance measurement and incentives.Published 19 months ago by Anthony Mastrean
This book is not an easy read. It has an academic tone so I had to stop a few times and reread the last sentence to get it right. It also doesn't offer a lot of practical advice. Read morePublished on April 6, 2014 by Amazon Customer
Excellent source of content for those struggling with the complexities of organization performance measurement. Read morePublished on January 11, 2014 by Thadd Stricker
This is a relatively difficult book to read. The structure is convoluted and the author is loquacious. Read morePublished on December 26, 2013 by DocOnDev
The content is fairly simple in essence it is surprising how many 'mature' companies fail in this category. Read morePublished on September 1, 2013 by Abel Brown
Balanced view addressing lovers and skeptical views of KPIs, practical examples of dysfunctional indicators, a must have for line and senior management.Published on February 3, 2013 by Marcio C. Esteves
No, really. I've never looked at the world the same since reading this book many years ago. Austin, a former executive at Ford Motors Europe and now on the faculty of Harvard... Read morePublished on July 29, 2011 by Chip Overclock®
This book is a really good resource for anyone in management or leadership who would like to find ways to measure the success of their business. Read morePublished on May 17, 2010 by phc