How to Hold Executives Accountable


We all know that Y=f(X), where Y is the “effect” and X is the “cause.” Together, let’s employ this line of reasoning to the evaluation of a CEO’s performance.

In this case, it’s easy to see that the performance criteria of any given CEO must first be identified, defined, quantified and validated. If such criterion are not present, then any performance assessment is merely a subjective evaluation (often called the “rubber-ruler” of success). Obviously, when such a subjective form of evaluation is at play, there is little or no accountability.

Continuing with this way of reasoning, we naturally understand that each performance measure (Y) must be connected or otherwise correlated to the “vital few” determinants (X’s). They too must also be identified, defined, quantified and validated.

Assuming there is a high degree of association between the selected Y’s and X’s, only then should the cycle of “cause-and-effect” be connected to the CEO’s incentive plan (reward system). At this point, the “CEO Dashboard” is complete and ready for implementation.

Of course, the aforementioned process can be applied to any job role, not just the CEO position.

The real key here is not so much the process (as it’s been demonstrated to work), but why so many governing Boards fail to insist on the use of such performance dashboards. Just imagine the hours of debate, emotionalism, finger-pointing, political drama and leadership strife that could be reduced or eliminated by applying a CEO dashboard.

About Mikel Harry

Dr. Harry has been widely recognized in many of today's notable publications as the Co-Creator of Six Sigma and the world's leading authority within this field. His book entitled Six Sigma: The Breakthrough Management Strategy Revolutionizing the World’s Top Corporations has been on the best seller list of the Wall Street Journal, New York Times, Business Week, and Amazon.com. He has been a consultant to many of the world’s top senior executives, such as Jack Welch, former CEO and Chairman of General Electric Corporation. Dr. Harry has also been a featured guest on popular television programs, such as the premier NBC show "Power Lunch." He is often quoted in newspapers like USA Today and interviewed by the media, such as The Economic Times. In addition, Dr. Harry has received many distinguished awards in recognition of his contributions to industry and society. At the present time, Dr. Harry is Chairman of the Six Sigma Management Institute and CEO of The Great Discovery, LLC.
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