Thursday, 25 February 2010

The system’s performance matters more than that of individuals.

It is said that the world divides into two types: those who see the big picture and work down to the details, and those who notice the details and work up from there. Leaders in the latter category may get swamped and never sufficiently raise their gaze. Gordon Brown may be the latter type – lost in the detail. Either way, concern for the big picture lies at the heart of the systems perspective. Diagnosis may start with the details (finding out what is currently happening), but the aim is to optimise the whole, not to optimise the parts. Optimising the parts sub-optimises the whole.

Take performance management. Whatever its claims, in practice it attempts to optimize the parts. I am bombarded with brochures about performance management. They usually mean individual appraisal. In some cases, by working from the bottom up – from the individual parts to the whole – an attempt is made to establish a link between an individual’s performance/goals and those of the organisation, but this is often perfunctory and tokenistic. It is, in any case, the wrong place to start.

See what happens if you take a genuine systems perspective. The organisation’s performance matters more than that of the individuals, and it comes about when the parts work well together as a system. That is why writers like Margaret Wheatley argue that the prime unit of an organisation’s performance is its quality of relationships, not individual talent. For a network to work well, maximise the connections and not the nodes.

An individual’s appraisal reinforces a management hierarchy’s natural controlling tendency, and may even be viewed as its raison d’etre. But, whereas individuals can be controlled to some degree, networks cannot. External forces are also undermining the significance of individual appraisal. When it comes to doing one’s job well, learning from the world is taking over from learning from one’s boss. Increasing complexity, plus changing technology (the internet and social media) and reduced deference accounts for this.

Conclusion: Individuals’ performance still matters, of course, but not as much as that of the organisation as a whole. So instead of being obsessed with getting 100% of individuals’ appraisals completed, put energy into appraising how well the organisation works as a system. When getting together with people to discuss performance, ask them how the organisation can improve. Leadership’s purpose is to liberate performance rather than to control it.