What I Learned At The Olympics About Managing
This column was originally published during the Nagano Winter Olympics in 1998. In honor of the Salt Lake City games, we've brought it out, dusted it off and are pleased to place it back in the line-up. Enjoy.
Fundamental to our society is the concept of keeping score. We measure ourselves (and more importantly, those we view as competitors) by income, social status, wealth, number of cars. Raw measures that provide an automatic comparison of how we stack up, and how far we still have to go. As the saying goes, he -- or she -- who has the most toys when they die wins.
There is no question that we are a competitive breed. Darwinism is a finely honed and decisive discriminator of our actions and thoughts -- socially and in business. And also in sports.
Our athletes are our new gladiators. Occasionally no less violent, and certainly no less gripping, whole nations are captivated and motivated by how well their team performs. This is no better illustrated than at the Olympics, where each nation keeps score of how well their athletes rack up. How many medals won and lost. The score in the women's hockey game between Canada and the U.S.
Imagine yourself as the new coach of the Canadian women's hockey team. Last three games ended 4-2, 5-6 and 8-2. What do you, as coach, need to do to improve the team's performance?
Not enough information? Isn't it reassuring to know that you can rely on stats for each player -- shots on goal, assists, goals. The strengths and weaknesses of each person are known and quantified, as are the stats for the team as a whole. Moreover, as coach, you have scouts out gathering exactly the same information on your competition; strengths, weaknesses, opportunities, threats -- the information you need to make sure that when your team hits the ice, you have given them the greatest amount of information possible to ensure success. And don't think the curling teams are any less competitive.
As a fan, you probably also consider yourself fairly well informed. There are too many armchair coaches to bely that fact. You know the stats, you know the plays -- and you probably think you can execute pretty well.
Pity what happens on Monday when you get back to the office, isn't it?
Companies are no less goal-driven than sports teams. Revenue, profitability, market share, EVA -- important elements of the scorecards used in determining corporate performance. Moreover, the incentives of the marketplace are directly tied to these means of keeping score. Executive pay, stock options, stock price, credit ratings, and a disturbing majority of corporate statistics are driven by some combination of these top-level scores.
Yet compared to their more athletic counterparts, corporate managers are woefully under-informed and unprepared to make decisions that can directly influence these numbers. You cannot manage a company by the balance sheet -- it is merely your scorecard. So, what statistics do you know about your team? What are their strengths? Their weaknesses? Where are the opportunities to seize competitive advantage?
And what about your competitors?
Unless we as organizations learn to ignore the score, and concentrate on understanding how we play the game, winning on the corporate ice-rink falls down to inherent talent and plain dumb luck.
Repeatability, consistency and success -- gold medal winning performances -- rely on a much more solid basis of understanding of our capabilities, and those of our competitors. Managing successfully requires access to a host of meaningful, useful and relevant statistics -- performance measures -- in order to harness our competitive strengths, mitigate our weaknesses, and seize competitive advantage.
Because the company that scores the most points wins.