The McNamara fallacy: Measurement is not understanding • Hacker News Board

Re: The McNamara fallacy: Measurement is not understanding

#201

Post by austincheney » Wed, Feb 02, 2022, 1:09 PM UTC

aidenn0 wrote: post #173

scubbo wrote: post #39

Surprised not to see Goodhart's Law[0] referenced here - "When a measure becomes a target, it ceases to be a good measure". Not the same concept, but a related one (as is the Cobra Effect[1], of which the poppy-field burning is an example) [0] https://en.wikipedia.org/wiki/Goodhart's_law [1] https://en.wikipedia.org/wiki/Perverse_incentive#The_origina...

I also think that Goodhart's law is a stronger effect than the McNamara Fallacy for Afghanistan; when people are actively faking results, then that's not so much measuring the wrong things as just flat out failing at measuring things.

The most important line from the article:

Those who are concerned about falling into the trap of the McNamara Fallacy shouldn’t abandon quantitative measurements and metrics.

A key example is Moneyball: https://en.m.wikipedia.org/wiki/Moneyball

In my line of work, JavaScript, people will intentionally ignore data that challenges their favored approach. Measuring things is important, but all these examples illustrate that measures are irrelevant when ethics are absent, which is worse than measures applied too narrowly as in the McNamara Fallacy.

Re: The McNamara fallacy: Measurement is not understanding

#202

Post by projektfu » Wed, Feb 02, 2022, 1:12 PM UTC

milesvp wrote: post #85

jscode wrote: post #23

Quick story: I was the CFO for a company that sold to a private equity group (PEG). I took over as the CEO as the founders retired, leaving me to deal with the PEG. It quickly became apparent that the PEG managers looked at everything through the lens of an Excel spreadsheet. These guys were brilliant attorneys and analysts but lacked experience building businesses and managing teams. Ultimately, they couldn’t add mu…

I worked at a company that started to go through the "you can't improve what you don't measure" phase. In general it was good for the org I was in, but I used to have to remind management that there's a corollary to that saying, which is: you necessarily improve things you measure at the expense of the things which are difficult or impossible to measure. This seems to be a hard one for some types to truly grok. A com…

"the most important figures that one needs for management are unknown or unknowable" -Lloyd Nelson, quoted by Deming.

Re: The McNamara fallacy: Measurement is not understanding

#203

Post by vinyl7 » Wed, Feb 02, 2022, 1:44 PM UTC

_blu wrote: post #188

bb88 wrote: post #175

Earlier quoted context omitted.

Companies exist for the stockholders, not the employees or the public at large.

that's a myth. it's the opposite that is true.

It's hard to argue against it when I see companies becoming more and more consumer hostile (cheap products that break in a year or after warranty is up, slow buggy software, incomplete game releases, ads crammed into every open space, FANG cornering their markets, dark patterns, etc.)

Re: The McNamara fallacy: Measurement is not understanding

#204

Post by trasz » Wed, Feb 02, 2022, 2:00 PM UTC

missedthecue wrote: post #102

serial_dev wrote: post #88

Earlier quoted context omitted.

The question is about what "winning" means for the people who start wars and keep fighting them. It might not be the same as for you. To quote Julian Assange, "The goal is to use Afghanistan to wash money out of the tax bases of the US and Europe through Afghanistan and back into the hands of a transnational security elite. The goal is an endless war, not a successful war".

I just don't buy that line of thinking at all. If that is truly their goal, there are way easier and subtle ways to do it without causing a collapse in political capital for the parties and politicians involved, which the Vietnam, Iraq, and Afghanistan wars did.

Such as? What other mechanism makes it possible to pay 700 billions per year to the private sector for something that the taxpayer can't see, because it's secret?

Re: The McNamara fallacy: Measurement is not understanding

#205

Post by salawat » Wed, Feb 02, 2022, 2:56 PM UTC

bb88 wrote: post #177

andrei_says_ wrote: post #131

Earlier quoted context omitted.

The issue is that the bean counters count beans and not creativity. Can we think of a way to connect and individual’s creativity to money flow? As an engineer I am most productive when I solve a business need without writing code. How can I associate my contributions with measurable profit?

When you write an api, add "dollars_saved", for the amount of dollars your api is currently saving the company. CFO's love that quantitative shit.

Y'all are looking for quantitative Quality measures. Good luck. If you aren't sitting on top of Spend informed by actual company history, you're hosed, and most places are hush hush af about that.

Re: The McNamara fallacy: Measurement is not understanding

#206

Post by erosenbe0 » Wed, Feb 02, 2022, 2:58 PM UTC

projektfu wrote: post #200

erosenbe0 wrote: post #190

Earlier quoted context omitted.

Disagree. Intel has had continuous dividends for at least 30 years. Few giant American companies have been as consistently successful as Intel. I can think of only Microsoft, one or two energy conglomerates like ExxonMobil, a telecom or two like Verizon, and maybe a bank like Goldman Sachs.

Abbott Labs, CR Bard, Deere & Co. Something about staying in your lane while increasing opportunities in that lane seems to be a good long-term formula.

Yep, Bard is part of BD, which is a large beast. Abbott/Abbvie always has something going for them. UnitedHealth has done well for years and years as it has grown. There might also be a stable industrial I am forgetting like a chemical company or 3M.

But overall, giant companies with 30 year runs of knockout growth and/or dividends like Intel are Cinderella stories. Google will be the next one to qualify in a few years I suppose.

Re: The McNamara fallacy: Measurement is not understanding

#207

Post by salawat » Wed, Feb 02, 2022, 3:02 PM UTC

EForEndeavour wrote: post #170

diob wrote: post #112

Earlier quoted context omitted.

Your story is the story of most companies. I watched "my" company get sold to private equity, and leading up to our "soon" sale they have been slashing the one thing they can, employee benefits (it's been a quick 3 year decline). I've watched more than half our team leave, much to the chagrin of befuddled execs. "Why are they leaving?" "Well, we used to have meaningful raises, bonuses, profit sharing, etc. but you ha…

Are you still at this company? What keeps you there?

Someone has to turn out the lights and record the fall for posterity. You've never Grim Reapered a company before?

Re: The McNamara fallacy: Measurement is not understanding

#208

Post by salawat » Wed, Feb 02, 2022, 3:06 PM UTC

apohn wrote: post #91

jscode wrote: post #23

Quick story: I was the CFO for a company that sold to a private equity group (PEG). I took over as the CEO as the founders retired, leaving me to deal with the PEG. It quickly became apparent that the PEG managers looked at everything through the lens of an Excel spreadsheet. These guys were brilliant attorneys and analysts but lacked experience building businesses and managing teams. Ultimately, they couldn’t add mu…

I worked at a company that went through a private equity acquisition and I have a question you might be able to answer. If you exclude layoffs and incentivized retirement, it seemed to be that a greater percentage of individual contributors left as compared to managers. Lots of managers stuck around for 12+ months, and it seemed like the percentage of managers of managers (e.g. directors, VPs) who stuck around was ev…

As a one-foot-in manager, I tend to stick around as long as someone is still on the receiving end of one of my policies. Bad practice to not observe the unpleasant consequences with future aspirations to leadership.

Re: The McNamara fallacy: Measurement is not understanding

#209

Post by tomrod » Wed, Feb 02, 2022, 3:10 PM UTC

mcguire wrote: post #117

tomrod wrote: post #16

Earlier quoted context omitted.

(1) Externalities are handled in the game theory literature (2) Preference definitions are not in scope for most game theory lit; what you're describing are preferences and expected utility, which ARE in the literature and metamodel (3) This is not really true. It depends on how big you are and how big your coalition is. Consider that Saddam Hussain is no longer in charge of Iraq. (4) Yes, potential outcomes are cons…

You didn't work at Rand in the 1960s, did you? :-) Anyway, the OP may be correct, but is also completely useless since it is impossible to know your own true strength, much less that of the other side.

LOL, no, but, reading the research of that period, it would have been fun!

Bell labs in the 1970s and 1980s as well.

It's not totally useless; the game theory framework is still helpful if you define your expected ROI (and your competitors). It is decision and strategy under uncertainty, of course, but its still a useful decision approach.

Re: The McNamara fallacy: Measurement is not understanding

#210

Post by logicalmonster » Wed, Feb 02, 2022, 3:19 PM UTC

johnp271 wrote: post #70

Does the McNamara Fallacy have any application to our response to COVID? I often hear pundits of all sorts, medical doctors, epidemiologists, politicians, CDC scientists, etc, make statements such as "the data shows this" and "the data says that" and then follow up with "therefore the science says we must all do such-and-such". I hold a rather narrow, rigorous - maybe closed minded - opinion of what is 'science' (so…

> Does the McNamara Fallacy have any application to our response to COVID?

In my opinion, yes. Many politicians and media are fixated on stats like "Covid cases" whereas society depends on multiple variables to function including the health of the economy, mental health and social cohesion of the population, people having hope for the future, the freedom to make choices for yourself, and people being able to exercise and not living unhealthy lives, etc.

> "the data shows this" and "the data says that"

This kind of objective data is generally science.

> "therefore the science says we must all do such-and-such"

This kind of thing is a policy or risk-management decision being wrongly conflated as science.