More and more companies, government agencies, educational institutions and philanthropic organisations are today in the grip of a new phenomenon: ‘metric fixation’. The key components of metric fixation are the belief that it is possible – and desirable – to replace professional judgment (acquired through personal experience and talent) with numerical indicators of comparative performance based upon standardised data (metrics); and that the best way to motivate people within these organisations is by attaching rewards and penalties to their measured performance.
The rewards can be monetary, in the form of pay for performance, say, or reputational, in the form of college rankings, hospital ratings, surgical report cards and so on. But the most dramatic negative effect of metric fixation is its propensity to incentivise gaming: that is, encouraging professionals to maximise the metrics in ways that are at odds with the larger purpose of the organisation. If the rate of major crimes in a district becomes the metric according to which police officers are promoted, then some officers will respond by simply not recording crimes or downgrading them from major offences to misdemeanours. Or take the case of surgeons. When the metrics of success and failure are made public – affecting their reputation and income – some surgeons will improve their metric scores by refusing to operate on patients with more complex problems, whose surgical outcomes are more likely to be negative. Who suffers? The patients who don’t get operated upon.
When reward is tied to measured performance, metric fixation invites just this sort of gaming. But metric fixation also leads to a variety of more subtle unintended negative consequences. These include goal displacement, which comes in many varieties: when performance is judged by a few measures, and the stakes are high (keeping one’s job, getting a pay rise or raising the stock price at the time that stock options are vested), people focus on satisfying those measures – often at the expense of other, more important organisational goals that are not measured. The best-known example is ‘teaching to the test’, a widespread phenomenon that has distorted primary and secondary education in the United States since the adoption of the No Child Left Behind Act of 2001.
Short-termism is another negative. Measured performance encourages what the US sociologist Robert K Merton in 1936 called ‘the imperious immediacy of interests … where the actor’s paramount concern with the foreseen immediate consequences excludes consideration of further or other consequences’. In short, advancing short-term goals at the expense of long-range considerations. This problem is endemic to publicly traded corporations that sacrifice long-term research and development, and the development of their staff, to the perceived imperatives of the quarterly report.
To the debit side of the ledger must also be added the transactional costs of metrics: the expenditure of employee time by those tasked with compiling and processing the metrics in the first place – not to mention the time required to actually read them.
Q.1 Which of the following is NOT a consequence of the ‘metric fixation’ phenomenon mentioned in the passage?
- Finding a way to show better results without actually improving performance.
- Short-term orientation induced by frequent measurement of performance.
- Improving cooperation among employees leading to increased organisational effectiveness in the long run.
- Deviating from organisationally important objectives to measurable yet less important objectives.
Q.2 Of the following, which would have added the least depth to the author’s argument?
- A comparative case study of metrics- and non-metrics-based evaluation, and its impact on the main goals of an organisation.
- An analysis of the reasons why metrics fixation is becoming popular despite its drawbacks.
- Assessment of the pros and cons of a professional judgment-based evaluation system.
- More real-life illustrations of the consequences of employees and professionals gaming metrics-based performance measurement systems.
Q.3 What is the main idea that the author is trying to highlight in the passage?
- All kinds of organisations are now relying on metrics to measure performance and to give rewards and punishments.
- Performance measurement needs to be precise and cost-effective to be useful for evaluating organisational performance.
- Long-term organisational goals should not be ignored for short-term measures of organisational success.
- Evaluating performance by using measurable performance metrics may misguide organisational goal achievement.
Q.4 What main point does the author want to convey through the examples of the police officer and the surgeon?
- Critical public roles should not be evaluated on metrics-based performance measures.
- Metrics-linked rewards may encourage unethical behaviour among some professionals.
- The actions of police officers and surgeons have a significantly impact on society.
- Some professionals are likely to be significantly influenced by the design of performance measurement systems.
Q.5 All of the following can be a possible feature of the No Child Left Behind Act of 2001, EXCEPT:
- standardised test scores can be critical in determining a student’s educational future.
- the focus is more on test-taking skills than on higher order thinking and problem-solving.
- school funding and sanctions are tied to yearly improvement shown on tests.
- 4. assessment is dependent on the teacher’s subjective evaluation of students’ class participation.
Q1: Option (3)
Q2: Option (4)
Q3: Option (4)
Q4: Option (2)
Q5: Option (4)
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