![]() Apple’s “Think different” and Samsung’s “Create the future” could be linked to the amount of sales from new products. With metrics, Ford Motor Company’s onetime strategy “Quality is job one” could be translated into Six Sigma performance standards. Strategy is abstract by definition, but metrics give strategy form, allowing our minds to grasp it more readily. Tying performance metrics to strategy has become an accepted best practice over the past few decades. Using multiple yardsticks is very helpful, however that highlights the fact that no single metric captures the strategy and makes people less apt to surrogate. ![]() Tying financial incentives to a metric is usually a mistake: It only increases the focus on the numbers. For instance, they can involve the people who’ll implement a strategy in its formulation, so they’ll be more likely to grasp it and less likely to replace it with a metric. Though it’s easy to fall into the surrogation snare, firms can take steps to avoid it. The focus on cross-selling goals led employees to open 3.5 million accounts without customer consent, which, with brutal irony, severely damaged the long-term relationships the bank sought. Executives there decided to track cross-sales to customers to measure performance on the bank’s strategy of building long-term customer relationships. This tendency is called surrogation, and it destroys a lot of value. Because strategy is abstract, employees often mentally replace it with the hard metrics meant to assess whether the organization is succeeding at it. Every day, at almost every company, strategy is being hijacked by numbers.
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