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Evidence-Based Management Has Issues
by Wally Bock

I was raised in a family where spirited discussions were common. Sometimes when we were in the middle of a good debate, my mother would break in with one of her classic lines. "It's a fact," she would remind us, "We don't have to argue about it. We can look it up."

At that point we'd get up from the dinner table and begin pulling out reference books. We might call the library (you could do that then) or call a family friend who would know the answer to our question. We were on a quest for facts.

That's the whole idea behind Evidence-Based Management. Get the facts about what works. Forget about management folklore. Forget about management fads. Forget about what you think is true. Get the facts.

I got excited when I first started reading about Evidence-Based Management. It seemed perfect for a time when new "studies" of dubious quality flow across the news wires hourly. I liked the idea of applying the scientific method to business.

This is scientific method in its basic and universal form, not the "physics-envy" form where the only good data is acquired using quantitative methods in carefully controlled situations. That might be good for some science, but it won't work for any human endeavor like management which involves making decisions on the fly in a complex and changing environment.

In management we have to fall back on the basics. Come up with an idea. Try it out somehow, someplace. Live fire trials are almost always better than thought experiments or survey research. Measure your results. Sometimes you can count them and sometimes you can't. Then modify your behavior based on what you learn.

Evidence-Based Management can help with that process. Rules like "look for risks and drawbacks in what people recommend" and "Avoid basing decisions on untested but strongly held beliefs, what you have done in the past, or on uncritical 'benchmarking' of what winners do" can help us make better choices.

Looking at the data can result in different kinds of action. Take the case of mergers and acquisitions.

Most mergers and acquisitions fail. Some studies put the number as high as 70 percent. You can respond to that in one of three ways.

You can ignore the research and plow ahead. You can choose not to do a merger because of the high likelihood of failure. Or you can do more research, compare winners and losers, listen to the advice of experienced executives, and modify your actions based on what you find.

That's the option Cisco chose. The company reviewed successful and unsuccessful mergers and acquisitions. Then they developed a protocol that has resulted in 57 successful ones.

Problems start when people don't use the results of research thoughtfully and effectively. Some adopt the findings uncritically. I call that "Cargo Cult Management." At one point in my career I had a boss like that.

He read all the articles and about how to succeed and for some reason he zeroed in on dress as the key factor. He missed the chapters on getting great results. One night, after he'd had far too much to drink, he explained to me how his success was due to the fact that he wore a thin watch and patent leather shoes. When he was fired for poor performance, he was genuinely puzzled.

That's not the only way people routinely misuse the findings of good research and ideas. Sometimes they just cherry-pick the findings they like. Managers who read Frederick Taylor's shovel study often adopted the parts about shovel design and placement of the coal pile, but ignored the recommendation to give workers regular breaks.

The same thing happened with the work of W. Edwards Deming. Executives were quick to adopt the statistical quality control techniques, but skipped point eight. That's the one that advised management to "drive out fear."

One problem with Evidence-Based Management is that you still have to depend on people to implement the principles. But people cling to their assumptions and beliefs. They reject research that challenges those beliefs. Humans seem to have been this way forever. Very few are likely to do the hard work to question or verify what "everybody knows" is true.

That hard work can be formidable. Many Evidence-Based Management articles give the impression that the only evidence that really matters comes from carefully constructed, peer-reviewed studies. That presents several problems.

The first problem is that most managers don't read many peer-reviewed management journals. Most of us lack the expertise, energy, and time to determine which studies have worthwhile information that we can use to guide decision making.

It doesn't help that a huge number of academic studies are simply useless in the day-to-day world of management. I just analyzed a peer-reviewed study of employee compensation that spent 45 pages coming to conclusions that were not actionable.

The study was presented in the best academic manner. The authors described their methodology. They laid out their equations and described their data sources. There was a review of the literature.

There were two findings that caught my eye. One was that job tenure is longer in large companies than small companies. There's not much I can do with that. Imagine: "Note to self -- grow big to keep employees longer."

The second finding was that "married individuals are 22 percent more likely to leave their jobs than otherwise identical single workers." Imagine how you might act on that. "Note to self -- hire only single workers. Give them incentives to stay single."

It's simply not reasonable to expect a manager in today's fast-moving, competitive business environment to slog through studies like that one to find the good ones. There's one more problem. It's the problem of timeliness.

Most of the time, managers simply don't have the luxury of waiting for the academics to do the research and have their findings reviewed and published. Making decisions based on incomplete and often unverified information is one of the things that makes management an art.

At the end of the day, managers have to pull together information and recommendations as best they can and make their own decisions. The good news is that Evidence-Based Management gives us some effective tools for doing that more effectively. So here's what to do.

Grab ideas from wherever you can. Pore through journal articles, magazines, books and blogs.

When you spot a promising idea, be skeptical. Use questions from Evidence-Based Management to test assumptions and beliefs and the fitness of the idea for your situation. Don't stop there. Use other questions. Search for data that opposes the idea.

Try something. Figure out how to run a live trail. The best businesses are always trying and testing.

Measure your results. Analyze them.

Make changes based on what you find. Fortune may favor the brave, but success favors the realistic, active and adaptable.

Here's the bottom line on Evidence-Based Management. It's not the one answer that will solve all your problems. But Evidence-Based Management gives you tools that will help you use information more effectively and make better decisions.


Wally Bock helps organizations improve productivity and morale by selecting and developing great leaders at all levels. He coaches individual managers, and is a popular speaker at meetings and conferences in the US and elsewhere. This article first appeared in the Three Star Leadership Blog ( http://blog.threestarleadership.com/ ). Check out Wally's Working Supervisor's Support Kit ( http://www.threestarleadership.com/supervisorsupportkit/ ).

 


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Dec-06-2016




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