Wednesday, February 28, 2007

Scoreboards Vs. Clipboards

Before becoming the head coach of the Detroit Pistons basketball team, Flip Saunders was the head coach of the Minnesota Timberwolves. Flip coached in Minnesota for a long time—long enough to have been there through the lean years of the Timberwolves franchise.

There were many times in those early years, when the Minnesota Timberwolves could hardly ever win a game. The seasons become very long and very tiring when your team is losing the vast majority of its games. It doesn’t make it any easier when you have to suffer all of those losses while also suffering through the bitter cold Minnesota winters.

One time, when the winter weather outside was as bleak as were the prospects for winning that night’s game, a reporter thrust a microphone in front of Flip Saunders and asked him, “Coach, what does the team have to do tonight in order to win?”

An obviously tired and frustrated Flip Saunders replied, “Well…unless they’ve changed the rules, we have to score more points than the opposition.”

Coach Saunders was absolutely correct in his assessment. It would be impossible for his team to win if they let the opposition score more points than the Timberwolves. However, making a correct assessment of the situation and making a useful assessment of the situation can often be two very different things. Although Flip Saunders made a correct assessment, it was a worthless assessment, because it did not provide any insights into how to correct the situation.

Let’s imagine for a moment that Flip Saunders is still coaching one of those awful Minnesota Timberwolves teams of the past. It’s getting near the end of the game and the Timberwolves are behind in points. Flip calls a time out to huddle his team together. When he gets in the huddle, what would happen if he told the players,

“We’re behind in points. We can only win if we have more points than they do. Now go out there and get me more points than them!”

If that happened, I’m sure the players would give him a blank stare and have no idea what to do. It’s not as if they didn’t already know that scoring more points is a good thing. And I’m sure that they were trying to score points throughout the game. Just telling them to get more points is not helpful. Flip’s comments do not tell the team:

• What it is that they are doing wrong that is allowing the opposition to outscore them.
• What changes they could make to improve on their ability to score.
• What each player should be concentrating on for the rest of the game in order to improve their chances of winning.
• It doesn’t even tell the team which five players should go back on the floor to play when the time out is over.

Worse yet, what if Flip Saunders decided to stop paying attention to the game and only concentrated on the scoreboard? What if he started yelling at the scoreboard, saying things like,

“What’s the matter with you, scoreboard? Don’t you know that we need more points? Why aren’t you putting more points on there for us? Come on, scoreboard! Quit putting up all those points for the opposition! Give them to us!”

Sounds pretty silly, doesn’t it? No rational person would do things like this, would they?

Unfortunately, I have seen far too many otherwise rational people act just like this in the business world. How many of you have ever been in a business meeting when the boss has said something like this:

“Listen up. The problem with this division is that it does not have enough sales. Unless we get more sales, we cannot win on the bottom line. So go on out there and get me some more sales!”

Don’t you think the employees already recognize the importance of getting sales? Is there anything in this speech that is going to help them do a better job of getting sales than what they did before? This is as useless as the imaginary speech above when the coach called time out. As mentioned before, speeches like this do not tell the employee:

• What it is that they are doing wrong that is keeping them from getting sales.
• What changes they could make to improve on their ability to get sales.
• What each person should be concentrating on in order to improve the business’ chances of getting more sales.

Similarly, how many of you have been in a situation where the boss just got a financial report, and the boss started pointing at the numbers and yelling out something like this:

“Look at these numbers! They’re awful! Why can’t I get better sales numbers on these reports? The next time I look at one of these reports, I want to see bigger numbers!”

It sounds a lot like yelling at the scoreboard to me.

The principle here is understanding the difference between a scoreboard and a clipboard. When coaches call a time out, they do not bring a scoreboard into the huddle. Instead, they bring a clipboard into the huddle. They use the clipboard to diagram plays. The coaches use it to show the players what they are doing wrong and what they should be doing differently once the time out is over. The clipboard is a tool to help diagnose problems and prescribe solutions.

A scoreboard can do none of these things. Watching a scoreboard is like reading a thermometer. It can tell you the temperature (i.e., the “score”), but it cannot diagnose the cause of the fever nor prescribe a cure for the fever. The same thing is true when a business narrow-mindedly focuses only on the financial reporting. It can tell you the level of sales, but not why the sales are bad or how to make the sales better. Staring at the numbers does not make them any better. Yelling at them may make you feel better for a moment, but it really doesn’t help, either.

Business leaders need to come to business meetings with a clipboard. There needs to be time spent diagramming how the company got into the current predicament. There needs to be hypotheses of what can be done differently to improve the situation. There need to be specific assignments of what each person is supposed to do to help increase sales. In other words, one needs to spend time developing a STRATEGY.

Correctly identifying the problem (e.g., not enough sales) is an important first step. But it is only the first step. If you stop after only one step, you have not moved very far. One needs to also develop a strategy for solving the problem.

This is not to imply that financial measures are worthless. There is a reason why they keep score at sporting events. That’s how you know whether or not you are winning. There is a reason why doctors take your temperature. That’s helps them know how you stand in fighting the disease.

Financial reports are a great tool in monitoring one’s progress towards your goal. They let you know if you are winning. But do not confuse monitoring a problem with fixing a problem. Fixing a problem takes more than just observation. It requires active intervention in creating a better way to complete the task at hand.

The irony is that the more you focus on the results, the less time you have to focus on what it takes to get good results. Good outputs come from focusing on the inputs.

Finally, keep in mind that financial measurements are telling you what you have already accomplished. They are looking backwards. To win, you have to look forwards to what you plan to do once your “time out” meeting is over.

There is a difference between scoreboards and clipboards. Scoreboards tell you about how much progress you are making towards your goal, but they cannot tell you how to improve your performance. Conversely, clipboards can help you diagram a better strategy, but they cannot measure how well you are executing that strategy. Both are important. Too often, executives fall into the trap of thinking that just because they are paying attention to the score, they have completed the task. Unless someone is making diagrams on the clipboard, all you are measuring is chaos…and that probably means you will not like your score.

I’ll bet Flip Saunders had a lot more fun coaching a champion like the Detroit Pistons than he did coaching those losing seasons back in Minnesota. If you want to have more fun, focus on building a great team rather than on just yelling at the scoreboard.

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