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Michael Scott and The Peter Principle


Michael Scott and The Peter Principle

The "Peter Principle" is the idea that when promotions are made on the basis of prior performance, everyone will eventually be promoted to their own level of incompetence.  It still has resonance some 40 years after is was first proposed, and it has an enormous impact on productivity, engagement, and retention in organisations today.


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The False Proxy Trap

Back in November, Seth Godin wrote:

"Sometimes, we can't measure what we need, so we invent a proxy, something that's much easier to measure and stands in as an approximation."

We do this all the time in HR out of necessity - we measure employee satisfaction because there's a connection between satisfaction and productivity, for example; and it's difficult in many (but not all) roles to measure productivity directly.  Godin goes on to explain how this can become a problem when we focus on the proxy (in this example, employee satisfaction) and forget the goal (in this example, employee productivity):

"...When we fall in love with a proxy, we spend our time improving the proxy instead of focusing on our original (more important) goal instead"

I believe we often fall into this trap too - being obsessed with employee satisfaction metrics as if they are an end in themselves, forgetting that the point is to increase employee productivity - and that:

  1. There are many other paths to boosting employee productivity; and
  2. Not all of the ways to increase employee satisfaction will also increase employee productivity.

What are some other examples of the "false proxy trap" in HR?

(This post originally appeared at, the other place I blog at from time to time)

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The ROI of Talent Management Programs

I've been working with a great organisation here in Melbourne over the last few weeks and ran a 2-day Strategic Workforce Planning workshop with them recently.  One of the questions that kept coming up was how to engage the executive in Strategic Workforce Planning to ensure that the program is successful.  In my experience, as well as aligning the workforce strategy to the business strategy, Strategic Workforce Planning is an effective way way of providing evidence that each initiative is providing a Return on Investment - or showing where they are not, and how to improve. It's not easy, at times, to quantify the costs of HR programs in in an organisation - but there are ways of doing it.  Turnover and Absenteeism are relatively straight-forward, but how do you put a price on innovation? productivity? creativity?   Even more challenging is predicting the extent to which a particular program will increase or decrease these factors.

Wayne Cascio, who I was fortunate enough to meet last year, has some great resources - including the book "Costing Human Resources" - with some techniques for costing some of these aspects.  For factors such as innovation and productivity, case studies can be instructive - but as each organisation is different, a well-crafted analytics strategy is the only way to really prove the "return" on your people investments in your organisation.

Business talks the language of numbers - and though it can be challenging, justifying proposed HR programs, and uncovering the value of existing ones, is one way of elevating Human Resources to become a strategic partner to the business.


The Productive Workplace has Psychadelic Carpet


The Productive Workplace has Psychadelic Carpet

Bellagio Carpet

Bellagio Carpet

Does Las Vegas have anything to teach Employers about employee engagement?

I've recently been reading about "flow", a state of extreme focus and productivity - and the lengths that Las Vegas casinos will go to in encouraging it.  This got me thinking about how Flow could be applied to the workplace, and whether Las Vegas has anything to teach employers about it.

Flow is the concept of intrinsically motivated activity - activity that is in itself rewarding, regardless of the outcome of that activity.  In this 2002 article, Flow is described as having these characteristics:

  • Intense and focused concentration on what one is doing in the present moment
  • Merging of action and awareness
  • Loss of reflective self-consciousness (i.e., loss of awareness of oneself as a social actor)
  • A sense that one can control one's actions; that is, a sense the one can in principle deal with the situation because one knows how to respond to whatever happens next
  • Distortion of temporal experience (typically, a sense that time has passed faster than normal)
  • Experience of the activity as intrinsically rewarding, such that often the end goal is just an excuse for the process.
Productivity requires the right balance between challenge and skill

Productivity requires the right balance between challenge and skill

It takes the right combination of skill and challenge to achieve flow.  Too much challenge for the individuals' skill level, and the result is anxiety.  Too much skill for the challenge level, and the result is boredom.  Of course, those who are highly both skilled and highly challenged perform the best - which might explain why A Players are widely cited as being many multiple times more productive than B Players.  For example in this article, Steve Jobs is quoted as saying:

Now, in software, and it used ot be the case in hardware, the difference between the average software developer and the best is 50:1; Maybe even 100:1

HR professionals might think of flow in employees as extreme engagement and productivity.  Casinos think of it in its' customers as extremely profitable, and "encouraging flow" in Vegas is big business.  For example, the casinos use some of these tricks - some more applicable to the workplace than others:

Regular Feedback

Lights and sounds provide gamblers with regular feedback on how they are performing.  This motivates them to continue.  It's easy to imagine how this one can be incorporated into the workplace.


The occasional free ticket or meal makes visitors to the casinos feel valued and important.  In many cases, the payoff in loyalty is much greater than the cost of the gift - in casinos as in workplaces, people get a boost of motivation from recognition and a sense of achievement.

The Physical Environment

Ugly Carpet

The psychadelic carpets in Vegas give a sense of the surreal, encouraging the distortion of temporal experience, one of the conditions of "flow".

Getting rid of the clocks and windows

Vegas casino's don't have clocks or windows - again, the distortion of temporal experience and losing sense of time.


When a casino in Las Vegas pumped a pleasant but unidentifiable scent into a slot-machine area on a Saturday, the machines raked in about 50 percent more money than on the previous or following Saturday.  Elsewhere it's been suggested that pumping pheremones into the air encourages people to gamble more aggressively


Music can help to encourage people into a trance-like state.  Casinos use this to great effect, and it's been reported elsewhere that some casinos even use different music in the same elevator depending on whether you're going up or down to regulate mood.

Challenge matching the Skill

As mentioned above, flow happens when a the challenge and the skill are in synch - if these are out of balance, then boredom or anxiety are the end results.

The casinos in Las Vegas spend a lot of time and money researching these conditions to encourage "flow" - and I wonder if there are any of these concepts that we can apply to workplaces.  After all, if "Flow" is the secret to happiness as Csikszentmihalyi claims, then setting the work environment up to maximise the chance of flow makes for both happy and productive workers.  Are there any other factors you can think of to encourage "flow" in the workplace?

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