Metrics
Granular Data for Decisions

... this blog considers how to gauge and measure impact. ... an interesting phrase

Burgess COMMENTARY
Whether it’s at the country, corporate or individual level, this blog considers how to gauge and measure impact. ... an interesting phrase, and one that deserves some analysis, because it probably explains why the modern economy has become so dangerously dysfunctional.

Three entities are mentioned, and I argue that measures that apply to these entities are difficult if not impossible to use to get the results society needs.

At the country level, it is possible to make policy decisions, but this is a little bit like 'pushing on a piece of string'. Most of the data are either averages that are almost always wrong from a decision making standpoint, or derived from tiny samples with accuracy that is near nothing.

At the corporate level decisions are determined by the profit process and the stock price potential. If a decision will result in reduction of profit or lower stock price it will not be made, yet nearly all the big issues that need to be addressed need investment and expenditure that do little or nothing for profits and stock prices. Bluntly put more productivity and more profit means less jobs. Better environmental outcomes means less profit. The corporate entity thinking only about profit cannot solve the big problems that society has to face.

The individual level is a good place for metrics ... but the individual has near zero power in modern society. There are a few powerful individuals ... the 1% or the 1% of the 1% ... but everyone else is in a labor market that is getting weaker and weaker and technology gets better and better. Labor is on a dangerous slide to the bottom and nobody seems to be bothered by this.

I argue that place is the key for metrics that are meaningful and will matter. If we were to measure the state, progress and performance of all economic activities and then aggregate the results (1) into the implementing organization and (2) into the place ... then we would see what activities and what organizations are doing things that benefit society and those that are doing well for themselves at the expense of society.

At the moment an organization makes money in a place ... and then moves on. To a great extent the profit has been extracted from the place in one way or another, and when the organization moves on the place is left holding the bag. Dare I mention 'Detroit' and a host of other places around the planet where organizations have operated and then left with the landscape littered with industrial detritus.

Metrics need to be about people, place, planet and profit ... something like the Triple Bottom LIne, but the question that gets answered is not how well the organization is doing but how well people, place and planet are doing.

Peter Burgess TrueValueMetrics
Peter Burgess