Performance Variability Dilemma Harvard Case Solution & Analysis

Performance variability frustrating managers worldwide. According to the authors, it takes many forms: a completely different sales figures for similar stores in similar areas; significantly different capacity prices for factories producing similar products, the major differences in insurance payments for such a car crash. In an effort to reduce performance variability, however, managers often go too far, they said. By force workers to "copy exactly" or "follow the instructions exactly," in any situation, they make it much more difficult for people to use their own judgment and knowledge to solve problems that would benefit from a new approach. Having studied this issue in depth, we have found that appropriate interventions to reduce the difference in performance depends on the individual methods of work - their frequency and predictability. Practices, which are becoming more frequent and predictable, are generally more favorable for severe overlap, while those that are rare and unpredictable have a greater need for flexibility and innovation. The authors argue that it is not enough to have a balance between uniformity and discretion at the company level. Each group of practitioners within the organization should also have a "Hide
by Eric Matheson, Laurence Prusak Source: MIT Sloan Management Review 8 pages. Publication Date: 01 Oct 2003. Prod. #: SMR116-PDF-ENG

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