Prove It!. Barr Stacey

increase profits, some companies maximise the number of birds per square foot of space. (In many operations, chickens get about the size of an A4 sheet of paper to live their lives in.) Aside from the birds' suffering and the stressful work environment for employees, there are some very significant costs to local communities and ecosystems. The ammonia from the chickens' waste makes going outside unbearable for whoever is downwind of the factories and causes irritation and health problems to those exposed. When the waste products are flushed from the factory floor, they run off into nearby streams and waterways and kill the aquatic life. These are the costs that don't make it into the companies' financial statements or annual reports, costs that communities and the environment pay (now and in the future) to subsidise those profits.

      High-performance organisations and companies don't solely pursue financial results as their definition of success. They pursue an array of results based on what all their stakeholder groups value most. And they pursue those results in a way that does not depend on other stakeholders paying the costs; how we make the journey to high performance is at least as important as getting there.

      So evidence-based leaders start with exceptional:

      • clarity about the results that truly do define success for their organisation

      • ownership of and responsibility for those results

      • care in guiding the organisation to that success.

      They give more attention and effort to these three things than most leaders seem to these days. These are the three basic principles of evidence-based leadership.

      CHAPTER 2

      EVIDENCE-BASED LEADERSHIP

      As Pulitzer Prize-winning author Carl Sagan noted in Cosmos:

      If we lived on a planet where nothing ever changed, there would be little to do. There would be nothing to figure out. There would be no impetus for science. And if we lived in an unpredictable world, where things changed in random or very complex ways, we would not be able to figure things out. Again, there would be no such thing as science. But we live in an in-between universe, where things change, but according to patterns, rules, or, as we call them, laws of nature …

      I find this quote one of the most inspiring motivations for measuring organisational performance. If the world were completely predictable, organisations would be like perfect machines: every outcome would be produced precisely as intended. Control would be at 100 per cent. At this extreme there is no use for measuring performance, because performance is always perfect, with no variation. But our world isn't like that. And that's why performance targets of perfection – such as ‘zero injuries' or ‘100 per cent on-time performance' – feel too confronting for people to commit to, no matter how idealistic or ‘right' they might seem. Our organisations are not deterministic machines.

      Conversely, if the world were completely unpredictable, with no order at all, organisations wouldn't exist: the concept of organising would be impossible. Control would be at 0 per cent. At this extreme there would be no use in measuring performance: it would vary so randomly that we could not observe patterns of causation, and would be unable exercise any degree of control over performance. But our world isn't like that either, which is why there is no excuse for decisions to be purely driven by gut feel or hearsay or tradition or whim.

      Our world is in between these extremes of perfect predictability and perfect unpredictability. There is variation, but it's not the product of complete randomness. It's the product of complexity, and there is order in this complexity. So in our in-between world we have a use for measuring performance, because it helps us quantify the variation and observe patterns of causation. It helps us learn how we can influence performance by using or changing these patterns.

      Measurement is the primary tool of the evidence-based leader.

      The purpose of evidence-based leadership is to navigate organisations through a world that is somewhere between the extremes of perfect predictability and perfect unpredictability, and measurement is the primary tool of the evidence-based leader. Performance measurement deepens our understanding of the complexity in our organisations, and speeds up our identification of patterns, so we can constantly improve at creating the results we want.

      Evidence-based leadership is not a mainstream practice in business. According to authors Jeffrey Pfeffer and Robert I. Sutton in their book Hard Facts, Dangerous Half-Truths and Total Nonsense:

      Business decisions, as many of our colleagues in business and your own experience can attest, are frequently based on hope or fear, what others seem to be doing, what senior leaders have done and believe has worked in the past, and their dearly held ideologies – in short, on lots of things other than the facts … If doctors practiced medicine the way many companies practice management, there would be far more sick and dead patients, and many more doctors would be in jail.

      The rise of evidence-based management

      The Harvard Business Review began publishing articles on evidence-based management in the mid 2000s, largely triggered by Pfeffer and Sutton's book, which describes evidence-based management as follows:

      Evidence-based management proceeds from the premise that using better, deeper logic and employing facts to the extent possible permits leaders to do their jobs better. Evidence-based management is based on the belief that facing the hard facts about what works and what doesn't, understanding the dangerous half-truths that constitute so much conventional wisdom about management, and rejecting the total nonsense that too often passes for sound advice will help organizations perform better.

      The Center for Evidence-Based Management (CEBMa) takes this definition of evidence-based management further, by outlining a process for practising it:

      Evidence-based practice is about making decisions through conscientious, explicit and judicious use of the best available evidence from multiple sources …

      We practise evidence-based management to increase the likelihood of achieving the results we want from the organisation we're managing.

      Evidence-based leadership is the application of evidence-based management at the most strategic level in an organisation. It has to be practised and prioritised by all of the senior leadership team, including the CEO and board members. If it isn't, then evidence-based management at lower levels won't happen quickly or comprehensively enough for an organisation to fulfil its mission and reach its vision.

      Leaders hold the space for high performance

      Evidence-based leadership is more than evidence-based management. An organisation's leaders must not only practise evidence-based management to elevate organisational performance at the strategic level – they must also inspire and encourage and expect it from everyone else in the organisation.

      When we are practising evidence-based management, we are using objective evidence to design and monitor the organisation's strategy. This evidence primarily comes from performance measures that monitor our progress toward the vision, mission and strategic goals. Other forms of evidence, such as research and case studies and experimental results, inform us of the best ways to make that progress happen sooner, or in larger steps, or with higher returns on our investment.