Leaders Don’t Hide Behind Data

Editor’s note: This article is part of a new MIT SMR series about how leadership is evolving in a digital world.

One hundred and thirty years ago, a jeweler named Willard Bundy changed the world of management: He invented the employee time clock.

It was a natural consequence of the times. Management had fueled industrialism (and vice versa). Without management, there was no chance to coordinate the workforce, to be sure the work was getting done, and to ensure quality. Management not only worked to contain the costs of our most expensive input (labor); it created a command-and-control regime that allowed us to increase productivity and quality.

Then Frederick Taylor came along and took things to the next level. Taylor was the Madame Curie of industrial management. His breakthrough work on scientific management created a movement that persists to this day. The theory is simple: With a clipboard and a stopwatch, you can measure and improve the performance of your workforce.

So, of course, the new digital tools were the next big thing, seen as a boon for managers. First, we digitized the time clock. But that was just the beginning. Now we can track the path of the night watchman, the keystrokes of the legal team, and the throughput on the assembly line. Not only do we get instant transparency into how labor works, but we can spend our days endlessly tweaking the data and using it to manage people even more closely.

At Bloomberg, every employee badges in every morning. That badge is connected to the internal management system, and now, white-collar workers are measured just as easily and precisely as those on the assembly line.

But a revolution is happening. As the resolution of our insight has gotten ever sharper, the need for more management has rapidly decreased. The step after making a job an efficient program is to automate it and replace it with a computer that works for free.

Two Digital Traps

There are two traps that have ensnared many who see digital management as a boon:

First, it’s easier than ever to do A/B testing. Digital tools allow us to spend a lot of time comparing one approach with another. A/B testing encourages tiny steps instead of bold ones. A/B testing is safe. A/B testing allows us to spend our day seeking deniability instead of taking responsibility.