When Measurement Goes Wrong: Dr. Robert Austin Explains Performance Dysfunction

Dr. Robert Austin, Professor of Information Systems at Ivey Business School and affiliated faculty member at Harvard Medical School, explores critical insights from his seminal work, Measuring and Managing Performance in Organizations, a foundational text that examines how performance measurement influences organizational behavior and reveals the often-overlooked risks of measurement dysfunction.

In this episode, Dr. Robert Austin, Professor of Information Systems at Ivey Business School and affiliated faculty member at Harvard Medical School, unpacks how well-intended performance metrics can quietly distort behavior and damage organizations. Drawing on classic work by Ridgway, Blau, and Kerr, he illustrates measurement dysfunction through vivid cases, from police departments gaming clearance rates to GE’s earnings manipulation and costly failure in large defense projects.

Dr. Austin explains the tension between using metrics for information versus motivation, framed through Goodhart’s Law, and shows how individual attribution and high-stakes incentives corrupt data quality. He traces the evolution of software development metrics and argues that creative and R&D-style work cannot be managed like factory output. The conversation closes with design principles for healthier measurement systems, the superiority of trust-based over metrics-obsessed management, and why, even in the digital age, more data can simply mean more sophisticated folly unless culture and cooperation are put at the center.

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