In a recent issue of the McKinsey Quarterly, there was an article entitled, “The New Metrics of Corporate Performance: Profit per Employee” by McKinsey partners Lowell Bryan and Claudia Joyce. I assume there is some panacea out there somewhere. And I suppose that this one is useful to the number-crunchers who need aggregated data. But given that there is no end to this or that way of measuring “corporate performance,” it seems to me that this article, for all of its astuteness, may miss a point or two.
All aggregated data gives a short of snapshot of the wake of the ship. It doesn’t tell you if you’re headed in the right direction, or about the condition of the ship. In my work, we have been able to create a P&L statement for every employee. This reveals where the trouble spots are. Margin per employee would be better than “profit” per employee, given the way that is conventionally generated.
As an antidote to RIC, it makes good sense. But neither one is about the performance of the company in its marketplace. Seems like this discussion is for the bureaucrats in the organization.