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Saturday, April 23, 2005
Batuhan: Instant replay
By Allan S. B. Batuhan
Foreign Exchange
LIFE AND DEATH. In the crazy world of football, officiating can be a matter of life and death. Die-hard fans of top clubs go to extreme measures, sometimes to the point of threatening referees that they think are giving their team a rough time, so much so that top FIFA officials have either threatened to quit, or have actually left the game altogether, to safeguard their life and limb.
Technology is partly to blame for the sport’s woes. With television covering every game from almost every conceivable angle, referees’ mistakes are often glaringly obvious. And in high pressure games where passionate fans from both sides are involved, these mistakes could easily touch off episodes of unfortunate violence.
The English sport of rugby, realizing that modern technology is here to stay, has cleverly co-opted into their game the very same tools that have become the scourge of its sister sport of football. Rugby allows “instant” video replays to overrule referee calls, in recognition of the fact that humans have limits to their powers of observation and, therefore, are prone to errors of judgment.
Rugby has changed with the times, using technology that is already available to benefit the game. Football’s problem is that it has refused to move on, choosing to officiate games in the same way as it was doing over a hundred years ago. In trying to preserve the purity of the sport, they have refused to acknowledge that the old ways are now arguably harming the game, rather than helping it to progress.
When we look today at how organizations are choosing to “officiate” their businesses—that is, to keep track of their progress and see how well they are doing —we see many examples of those that have followed football’s path, with only a few heeding rugby’s lead. Despite the low cost and abundance of new technology, very few have broken with tradition and forged ahead with radically new means of guiding their companies in today’s increasingly competitive markets.
POWERLESS. The Holy Grail of business performance evaluation is financial accounting, and modern organizations are seemingly powerless to stop it from occupying a central role in its vital decision making processes.
I make a very clear distinction here between financial accounting, which is externally focused, and management accounting, whose aims are to provide operating management with the information necessary to make educated commercial decisions. Both have—in many companies—become almost integrated, and financial accounting seems to always dominate the agenda, with management accounting coming in as an afterthought.
Today’s businesses, not unlike the fast-paced sport of football, operate in real-time, with no moment to spare for taking a breather. The speed of competition, the demands of the market, and the pressures of trying to stay ahead of both mean that management decisions are often taken “on-the-fly.” Tom Peters calls this the “Ready, Fire, Aim” approach to decision making.
It does not take a genius to realize that for such a fast-paced undertaking, an equally agile means of measuring and adjusting performance is likewise necessary. Similar to the video reviews in the lightning-fast game of rugby, managers need to see the game as it is happening, so they can blow the whistle at the appropriate time. Stubbornly sticking to the ways of the past, such as football has chosen to do, can only be an invitation to unmitigated disaster.
(allan.batuhan@pzcussons.com)
(April 23, 2005 issue)
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