smartKPIs.com Performance Architect update 23/2010

In one of my previous updates I reviewed the history of the Deming cycle and its relevance for Performance Management. One of the most important benefits of managing performance in organizations is that it facilitates a structured process of improving the achieved results, which is the essence of performance.

Improvement doesn’t automatically derive from measurement. A robust process of analysis and decision making is required to facilitate suitable actions or initiatives. And to illustrate this process, Study as in the PDSA cycle is more meaningful than the Check as in the PDCA cycle.

The Performance Management case study presented the scenario of a non-profit organization interested in addressing childhood development issues. Some of the measures used were:

• % Incidents of anemia
• # Average scores on language and communication skills for toddlers
• # Average scores for vocabulary tests

Using the traditional Plan – Do – Check – Act (PDCA) approach, the Check and Act phases would resume to gathering performance results data, reviewing it and taking actions to improve results. Generally the initiatives established as a result of this process would aim at doing more of the same thing. Improve efficiency or increase the volume of efforts.

However, a subtle change, that might appear superficial and technical to some, might mean more that it seems. Replacing Check with Study, shifts the emphasis from control and fixing the existing approach to learning and finding new ways to address the issue. For many years performance management has been associated with checking, inspecting, and controlling conformance. Performance Management for learning is a more balanced, mature approach to improvement.

In the case analyzed above, a review of the literature in the field and the latest research in the area of children health and development would reveal that the solution to the stagnation in achieving results might come from a surprising new direction. Under the title “Housing, Health, and Happiness” a new study published by the American Economic Journal: Economic Policy reveals that “replacing dirt floors with cement floors interrupts the transmission of parasitic infestations and should therefore reduce the incidence of both diarrhea and anemia. The reduction in anemia is expected to have positive effects on cognitive development” (Cattaneo et al, 2009).

The study, commissioned by the Mexican government, reveals the following results achieved during the experiment conducted in Mexico (UCBerkeleyNews, 2009):

• 20.1% reduction in incidents of anemia
• 30.2 percent higher score on the McArthur test (language and communication skills for toddlers ages 12 to 30 months)
• 9% improvement in the scores obtained in the PPVT test (vocabulary tests for children ages 36 to 71 months)

When limiting themselves to checking the data and doing more of the same thing, organizations do not create the suitable conditions for leaning and integrating new ideas. Expanding the scope of inquiry from current approaches to researching new ones and investigating what happens in the field they operate in around the world, the improvement process benefits from using a more robust view on performance management, that emphasize the role of the study component.

In the case described above, reviewing recent research in the issue of health and early childhood development reveals a potential new approach that might just be the solution sought after. Setting up a new initiative that aims at replacing dirt floors with cement promises to a positive impact on the health and cognitive development of young children in the targeted community.

Study puts initiatives management in a new light.

Stay smart! Enjoy smartKPIs.com!

Aurel Brudan

Performance Architect,
www.smartKPIs.com

References

Cattaneo, Matias D., Sebastian Galiani, Paul J. Gertler, Sebastian Martinez, and Rocio Titiunik. 2009. “Housing, Health, and Happiness” American Economic Journal: Economic Policy, 1(1): 75–105. Note: a working paper version of the article is available at: http://www.stanford.edu/group/siepr/cgi-bin/siepr/?q=system/files/shared/pubs/papers/pdf/SCID367.pdf

UCBerkeleyNews, 2009, “Inexpensive flooring change improves child health in urban slums” available at: http://berkeley.edu/news/media/releases/2009/03/10_floors.shtml, accessed 05 June 2010.