“Everything should be made as simple as possible, but not simpler.”
I recently saw a video by Eric Barker author of “Barking Up The Wrong Tree.” In this video Barker reveals, based on two researchers at Harvard (Nash and Stevenson), the four areas you need to fulfil to be happy and have a work-life balance. While I generally wouldn’t reflect on this type of article in this blog, I wanted to give an analogy based on his discussion.
Specifically, Barker highlights that many people look at the “work-life balance” through a single measure such as happiness or money. He points out that approaching simplification in this way misses the overall picture of such a complex need. For example, there are many instances of where simply making more money doesn’t automatically mean relationships do well and people are happier. What Nash and Stevenson discovered was that executives who are most successful in terms of work-life balance used four measures, and by adding a bit in each one of those areas on a routine basis, they ended up finding a good approximation of an overall work-life balance.
In Performance Based Contracting (PBC) many practitioners, and especially their time poor executives, want the same simplified outcome; a single performance measure that encompasses the outcome. By following this want and using a single performance measure many practitioners lose the insight required to manage complex commercial arrangements.
To address this I previously discussed the need to have a number and range of performance measures linked to different consequences (see When is a KPI not a KPI and The Allure of a Single Measure). This approach not only focuses sellers on the overall ‘strategic’ outcomes required by the buyer, but also gives both organisations insight into short and long term performance. By balancing both the number (quantity) and type (quantitative vs. qualitative) of performance measures. This is critical for highly successful PBCs. It is essential that PBC practitioners consider this as part of their performance measure design.
For the record, the 4 areas identified in the article in no particular order are:
- Happiness – “Are you enjoying what you’re doing?”
- Achievement – “Are you doing well, getting a head in your career?”
- Significance – “Is what you’re doing having positive effects in the people you love?”
- Legacy – “In some small way, is what you’re doing making the world a better place?”
In the end I hope that reader can take heed from Barker’s article and achieve balance whether it be in your PBC or your personal work life balance. If not, it is always good to have a stretch target (see Stretch Goals)!