This post is on the influence of measurement on behavior. A few years ago, I was intrigued to read an article by Michael Lewis in the New York Times on Shane Battier titled “The No-Stats All-Star”. The article states how basketball, unlike many other sports, mirrors life in the sense that maximizing personal goals is often at the expense of maximizing team goals, and it takes a rare player to transcend those barriers. It sets the context of how new metrics were derived for basketball inspired by Bill James’ work to try and include such behavior into accounting for a player’s performance.
And what came as a surprise to the analysts was the impact someone like Shane Battier had on his team, despite his mediocre personal stats. Lewis, as well as other authors have gone on to call this the “Shane Battier effect” where victory is defined as that for the team, and his role in optimizing his contributions in the context of where he can maximize his team’s impact against that particular opponent. Even in his current role with the Miami Heat he’s recounted as a great example of someone who will get the job done without worrying about formal roles assigned to him. I had written about this in a post titled “The Batmobile and race cars” a while ago on versatility vs. narrow depth of talent.
So what is the relevance of this in our corporate lives? Work, like life, is setup so that maximizing personal goals is often at odds with maximizing team goals. A wealth of research has looked at the incentive-goal alignment problem – for example, McClelland’s Needs Theory, Adam’s Equity Theory, Expectancy Theory and Hackman’s Theory of Job Design. Interesting books have been written as well from “The Carrot Principle” to “The Starfish and the Spider”. Despite all this, the notion of a collective maximization of efficiency through an individual’s efforts remains largely unused or underused. We find it hard to create measures that measure what we want to measure accurately, so we waste time measuring what is easy to measure – the classic “Streetlight Effect” paradox. It is more likely that the Shane Battiers of the corporate world are stowed away pushing paper in some back office than front and center coordinating between groups in a company, even if they were quietly lubricating the cogs of the machine within their reach so that the corporate machine they belong to runs faster, smoother, longer. And in a world where jobs are what companies care about and careers are what individuals care about, there is a fundamental dissonance of priorities as well.
However, in today’s world where the (Schumpeterian) creative destruction process cycles through faster and faster, building a great company requires one to avoid the pitfalls of measurement induced biases and find talent that is as yet uncalibrated by the market. Companies that do this successfully will be the great successes that we will point out in the technology sector in the coming decade, much like the Oakland A’s turnaround showcase in Moneyball.