Out of sight, out of mind

Nothing is as simple as it first appears.

More than 80% of the value of S&P 500 companies is intangible, yet people in business resist the concept that invisible things are real. Balance sheets and ROI calculations that assign intangible assets a value of zero might as well evaluate operations with a Ouija board.

Today’s Wall Street Journal contains an article titled When Work’s Invisible, So Are Its Satisfactions by Jared Sandberg.

In the past, people could see the fruits of their labor immediately: a chair made or a ball bearing produced. But it can be hard to find gratification from work that is largely invisible, or from delivering goods that are often metaphorical. You can’t even leave your mark on a document in increasingly paperless offices. It can be even harder trying to measure it all. That may explain why to-do listers write down tasks they’ve already completed just to be able to cross them off.

Down the street from here at Haas School of Business, Homa Bahrani says, “Information-age employees measure their accomplishment in net worth, company reputation, networks of relationships, and the products and services they’re associated with — elements that are more perceived and subjective than that field of corn, which either is or isn’t plowed.”

Companies should create meaningful short-term goals. Instead, “managers create all sorts of surrogate measures that they can measure, like PowerPoint slide counts and progress charts,” says consultant Tim Horan. “The person doing the landscaping has a better sense of accomplishment.”

Problems that arise from invisible accomplishments:

• Managers measure what’s easily measurable. Evaluation often encourages poor performance. Example: mistaking a long report for a useful one. Counting number of calls instead of the results of calls.
• Unlike producing physical objects, intangibles rarely provide a sense of completion. Work never ends. As enamored as I am with the metaphor of flow, floating down a placid stream offers all the excitement of kissing your sister.
• Assessing cost/benefit is tough to do when accomplishments are co-created, everything is connected to everything else, and you don’t know how to count measurements of outputs lost in a mix of concurrent business.