Is it rational to believe we make mostly rational decisions?

If you think economics humor is an oxymoron, you may want to skip to the next paragraph. If not, have you heard the story about the Ivy league economist who walks past a $100 bill on the sidewalk? Why would he do that? Well, having built his career constructing elaborate mathematical models based on rational actors, he thinks that if it truly was a hundred dollars someone would have picked it up by now. Ok, let's agree that Jerry Seinfeld will come up with better opening lines in his next standup. But it does raise an interesting question as it pertains to my professional world.

I work in IT consulting/outsourcing helping organizations optimize their technology infrastructure, improve their productivity and reduce their cyber risks. Each week, I have the unique privilege of meeting accomplished corporate and non-profit senior executives who are leading their organizations with courage and determination through this pandemic.

But I am amazed how two organizations of similar size in the same industry can come up with diametrically opposite points of view on something as fundamental as how to chart their IT future.

My conversations usually start with a simple but foundational question- how do they measure their organizations' IT success? Some will be honest and say they have no idea. Others will say "when nobody complains" or "we didn't get hacked." Then there is the proverbial "my IT staff (or managed services provider) fixes things when they break." None of this is rational.

Technology plays a crucial role not just in delivering products and services to your customers but in hiring and retaining staff amidst the Great Resignation. Not having clear metrics for measuring its success is organizational suicide. Hearing few complaints does not mean that your staff is happy. We all know that most people avoid conflict so if someone has an IT issue that, in the past, did not get resolved adequately they are unlikely to call a help desk unless their computer completely stops working. Or, as is the case in some organizations, any IT help gets charged an hourly fee, so employees may feel reluctant seeking the assistance they need. "Not getting hacked" (so far) does not mean your organization is truly protected. In fact, if people avoid reporting IT problems, it's more likely they will create greater security threats later.

The rational thing to do is to create, monitor and update KPI's that truly impact your organization's future. When I worked at Gatorade years ago, we used to measure "share of stomach" because as one of the first sports drinks we viewed water as one of our direct competitors. At the Washington Post, we focused on engagement because the more engaged the reader, the greater their value to advertisers.

It's hard to synthesize IT metrics into one all encompassing metric and it would be folly to try. What I do know is that it is not rational to measure something that obfuscates the truth. For example, some prospects tell me that they are happy because of how long (or short) it takes their IT department (or IT partner) to resolve help desk tickets. Yes, that certainly is good but how do you measure the problems that never got on the radar because their managed service provider proactively suggested an improvement that prevented that problem from ever coming up?

A rational way to evaluate IT must include broader measures of productivity that incorporate the amount of resources devoted and capture the savings in time that a more proactive IT management strategy can accomplish. By the way, since my father is an actual ivy league educated economist I have to state for the record he was not the source or inspiration for my opening joke!