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Most Hated Companies Survey: The Strategic Importance of Qualitative Measures

There is a recent article in 24/7 Wall Street about their survey The 15 Most Hated Companies in America. Wow! That goes way beyond underperforming; actually hated? This is a good reminder of the importance of qualitative measures when executing on strategy. Obviously, companies are judged emotionally, as well as analytically.

The numbers, the quantitative measurements of things like revenue, delivery time, or widgets are activity data – output. They are also historic and unchangable; Like the companies making the list, it’s too late to change the outcome. Qualitative measures are more subjective, like how do customers and employees view an organization? How good is the company’s leadership? How socially responsible is the organization? These kinds of qualitative measures are considered Leading Indicators, meaning that they can provide insight into possible outcomes of those quantitative measures.

There is a great debate over the use of qualitative measures as a performance indicators. True, qualitative data is about feelings and attitudes which can make measurement a challenge. This brings a certain amount of discomfort to many executives that only want what they consider cold, hard facts, believing that qualitative data is more on the order of New Age mumbo jumbo.

Of course, even cold, hard facts can suffer from distortion. There is a wealth of evidence that some companies, and some people within companies, “game” the numbers in order to present themselves in a better light, albeit it inaccurate or even fraudulent. Even rock-solid quantitative numbers can often have just as much mumbo jumbo associated with them.

This brings me back to the article, which used both qualitative and quantitative numbers when selecting companies for this list. I strongly agree that you need to use both, not just qualitative measures. Unfortunately, too many companies don’t use many qualitative indicators.

Working in tandem, these different types of indicators can provide the crosshairs necessary to better aim when trying to hit a target.

When a company makes a list like the 15 Most Hated Companies in America, it’s not just a marketing nightmare, it points to significant strategic performance problems. These companies had failures on multiple levels, far beyond offering simple explanations, or excuses. But hated? That does point to the importance of monitoring the qualitative performance indicators, doesn’t it?

Maybe you are not at the executive-level and wonder what you could do?

  • How your day-to-day decisions can have a positive effect on the performance of your company?
  • How what you do affects and influences internal and external attitudes?

Using both qualitative measures (like how well you serve customers), as well as quantitive (like how many you serve), goes a long way to give you better indicators of your performance.

Striving to make your customers, partners, and shareholders happy – those qualitative indicators – can go a long ways toward making a Best of list rather than the Most Hated list.

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  • Yes, absolutely right.

    Quantitative perspective is a strong heritage from science, hard to remove because give us the feeling of being objectives and under control of reality. But, numbers cannot say everything about organizations and performance -apart from the fact that they are intentionally distorted or manipulated.

    Anthropologist know very well the value of qualitative data since long time ago. Very early in the past century, The University of Chicago Department of Sociology pioneered the field with its Case Study Methodology Research, something that should be included in business cases to complete the whole picture of a problem.

    Organizational Change Management Projects, for example, where the intervention failures are very common, lacks of a strong qualitative support. Usually it is taken for granted that planning (PMBOK style) is enoguh to drive the change. Wrong. Qualitative data is not only about feelings and attitudes, Bob. It is much more than that: they say a lot of attributes and situations in organizations that hard figures CANNOT SAY, by its nature. Cultural issues, particularly invisible and intangible, cannot be managed by numbers.

    Watch an easy and great article about all this, written by Winston Tellis, in the net.