Quantified Organization

Data-informed management is hardly a new idea. Management accounting emerged during the first half of the 20th Century, and an emphasis on non-fiscal metrics was cemented with the arrival of the Balanced Scorecard in the early-90s.

The approach advocates a diligent cascade of mission, strategy and tactics to achieve defined strategic outcomes. It requires the design of the right balance of appropriate metrics to guide performance and helps secure organisational alignment.

That organizational alignment isn’t a once-off activity. Kaplan and Norton insist:

The alignment process, much like budgeting, should be part of the annual governance cycle.

It’s this corpus of work that informs one of our favourite BPM maxims:

Measure what you should, not what you can.

These two assertions are a good starting point for considering how the Quantified Organization is set apart from business performance management (BPM) approaches such as the Balanced Scorecard.

Firstly, anyone aspiring to develop a Responsive Organization will shudder at the idea that alignment is an annual process – such a drumbeat lost its relevance with the passing of agrarian society. The responsive organization is a quantified organization and it’s real-time.

In The Business of Influence, Philip Sheldrake presents an augmentation of the Balanced Scorecard he labels the Influence Scorecard, aspiring to leverage today’s centralized structures and BPM capabilities to embed performance management as sensory feedback throughout the organization, to prompt and qualify transformation.

We’re shifting the carrot-and-stick manifestations of BPM where KPIs are presented to you, to the facility for individuals and teams to surface their own understanding of their role and the value they can and do contribute. Deliberate strategy and deliberate alignment makes way for emergent strategy and emergent alignment.

This is not so much performance management in the old simple counting sense, but more a biomimetic sense.

Measurement and sensing

That brings us back to that maxim about measuring only what you should. Measurement and sensing are different. Measurement is an action – intentional, purposive, subjectively meaningful. Sensing is behavioural – automatic and reflexive.

It’s worth remembering that the Balanced Scorecard emerged in an age where the prefix electronic- distinguished the mainframe-powered from the analogue. Data paucity was the norm and the pursuit of data collection to live up to the expectations of the Scorecard was not inexpensive. By contrast, the Quantified Organization swims in data.

Sensing does not substitute for measurement, rather we can consider measurement as the emphasis of some of the information derived from all that sensed data in the process of sense-making.

See Socioveillance.