Closing the Intelligence Gap - Gary Cokins on Performance Management

Although Soviet central planning has been discredited at the macro-economic level and replaced with allegiance to capitalism’s “invisible hand” to self-correct imbalances in an economy, global management teams in all industries and trade commerce have always been practicing Soviet-like central planning – but at the micro-economic level. Simon Caulkin of the UK-based Guardian newspaper describes this in his article, Inside every chief exec, there is a Soviet planner.

Caulkin joins the increasing chorus of journalists who now explain, with hindsight, how those small cracks in capitalist macro-economic structures theory created large structural economic collapse. But at the micro-economic level how does Performance Management’s integrated methodologies relate to Soviet central planning? Perfectly. And it makes central planning work even better. How?

Performance Management (PM), when supported with software automation such as from my employer SAS, empowers central planning by linking true customer preferences and needs to the “central plan.” In the days of the USSR this link was weak or missing. PM refers to the “central plan” as its strategy map, balanced scorecard and dashboard methodologies. The executives “centrally” formulate the strategy, and these methodologies then communicate to employees what the plan is and guide managers and employee teams how to achieve it. The old adage, you get what you measure, kicks in.

Finally, Performance Management has business analytics including predictive analytics embedded in each of its integrated methodologies. Therefore PM substantially improves the “plan” in central planning. And PM’s integration of methodologies, such as customer analytics with profitability reporting using activity-based costing principles, assure achieving that plan. And since today “central plans” keep changing, PM’s methodologies allow the organization’s employees and resources to quickly re-adjust and align to execute the executive team’s revised plan.

Before entering the Vostok 1 capsule, Cosmonaut Gagarin said, “Poyekthali” which means, “Let’s go.” If you are hesitating about pursuing PM, I suggest you take Gagarin’s attitude. I think Lenin would have liked Performance Management.