BIG DATA: If You Hate Where Micro Management Is Heading, Look Away

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The era of big data is driving “cultural change” at the NAB with the bank now broken down into 165 functional units.

The Australian reports that “performance and ­remuneration in each unit to be determined according to a range of financial and non-financial measures ranging from return on equity to risk, customer satisfaction and gender diversity.”

The program has been trialed in the NAB’s wholesale bank, which looks after markets and big corporate style clients, and will be rolled out across the entire organisation in 2015.

NAB CFO Craig Drummond said:

…we will have, on a regular basis and in a digital form for our top executives, all of their KPIs updated on a regular basis so they can granularly monitor what’s going on, what risks we’re taking in a particular performance unit, and how their performance is tracking against their KPIs and their plan.

It’s about performance ­accountability…

As a behavioural economics and finance guy, this is intriguing and it will certainly drive cultural change. But the key question for NAB is exactly what cultural change will it drive?

Investors and managers will applaud accountability but as Peter Drucker wrote, What gets measured, gets managed.

So the impact on workers – and potentially, down-the-line productivity – from a rising risk of micro-management and short-term goal focus could be devastating.

Time will tell.

You read more here.

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