Measuring Love and Profits: A Cautionary Note

We compensation professionals have a tendency to get fixated on measurement.  After all, without measuring performance, we cannot reward performance - yes?  And we LIVE to reward performance...

In our zealous pursuit of performance measurement, however, it is good to have someone from outside our profession give us the occasional gentle prod and cautionary reminder (or, as needed, kick in the pants).  Charles Green of the Trust Matters blog has done just that with his gem of a post Success and Measuring Success.

He begins with the question of how we measure the degree to which a loved one loves us.  By their attention?  That special look in their eyes? Or how about flowers?  Yes, there is an easy-to-identify, quantifiable measure.  Flowers!

Charlie takes the analogy over to business, and to profits as the measure of business success.  Most of us understand that flowers would be simply a measure of love, not love itself.  But are we making the appropriate distinction between profits and business success?

From Charlie's post:

So, would you ever mistake the measure—profits—for the success they purport to measure? Do profits really equal success?

Unlike love-and-roses, all too often our answer is 'yes.' Yes, we say, the whole point of business is to make profits. Success consists of making money. It seems silly, we say, to differentiate between the two--the poor sucker who does so is sadly self-deluded and likely to get fleeced by sharper competitors.

In amore, we know the difference between love itself and pale trailing indicators of its recent presence. But in business, we confuse the yardstick with length itself; we’ve lost the ability to distinguish maps from reality.

When did profit move from being a measure of success, to being iconized as success itself?

For those of us laboring in the for-profit world, we need to be careful about discounting the importance of profits.  True even in the not-for-profit world: as the saying goes ... "no margin, no mission".  But I think Charlie's point is well taken in that an unwillingness to distinguish between what is the means versus what is the ends here may ultimately come back to bite us.

I'll leave the last word to him.

If all you focus on is roses, you'll at least have flowers at the end of the day; but you’ll fail at love. In business, if all you focus on is profits, you won't even get that. Because, simply, we don’t trust people who are only in it for the money.

Image: Creative Commons Photo "Single Rose of Love" by Subramanian Kabilan

Comments

[Leonard Pfeiffer IV]

Hi Ann

I am new to this thing --- blogging. Never had enough time but certainly appreciate the 'learning' it can bring. Was just directed to yours and hope my simple ideas are helpful to your readers.

In brief response to your article, profits are important, without them the organization, even the not for profit, eventually disappears. However, profit is not everything --- some times, it is a nice ‘bonus’ on top of accomplishing the mission! We always look for the passion in the executives we recruit to be new CEOs, CFOs, etc. We want to hear their 'war stories' about how they led other organizations, and in doing that we get a sense of how much they care about what they do, how well they do it, etc. When they care about quality and doing it right, in addition to making money, we really perk up. It is their ability AND their passion that makes them successful --- and that is what our Board clients have come to expect us to show them in a potential new CEO, COO, etc.
Warm Regards,Leonard Pfeiffer, Washington, DC

[Ann Bares]

Leonard:

Welcome to the world of blogging (and my appreciation to whoever directed you here). We appreciate your thoughts and ideas, and hope you'll return to share them often!

Agreed - that the way to profits is through passion, great leadership, caring about quality, etc. - not by focusing strictly on the profits themselves!

[Paul Hebert]

I hope this isn't too indelicate but when I first read Charles' post the other day I thought that like love being the manifestation of a lot of different things, success in business is also a melange different measures.

To me business only for profit would be the same as love based solely on sex. Neither is sustainable.

[Ann Bares]

Paul:

A great analogy, actually - follows nicely (and I don't think too indelicately) from Charles' post. Thanks for sharing!

[Charles H. Green]

Ann,

Thanks for picking this up. I worried a little what the reaction would be in the world of measurers, but I think you clearly understood what I was trying to say, and your comment about ends/means is right on.

As to your relationship/sex analogy, I think it is perfect. In general, relationships analogies (most appropriately romantic relationships, but also parent-child, friend, sibling, etc.) are very powerful; more suggestive than the usual military or sports-based analogies.

Thanks for the highlighting. And Paul, welcome to blogging. It's a relationship built on dialogue, and like we're talking about above, practicing it for its own rewards will bring others--but only if you focus on blogging for blogging's sake!

[Rhys]

I just read a book called "The Power of Small" that got me thinking about similar things. It can be a mistake to confuse process for results. For instance, trying to get an A is not the same as learning. It makes sense to connect that to profits as well. If a business focuses on nothing but making money, it often backfires. Focus on the little things and try to make the world a better place, and you're likely to be rewarded.