Corporate leaders risk failure if their own data dashboards start lying to them

livemint.com:

Yes Bank, Ranbaxy and Theranos? You would have probably guessed that each of these once-lauded companies was involved in a major scam, causing an incalculable erosion of wealth, reputation, shareholder value, and, in some cases, worse. There is a more disturbing commonality among these fraudulent companies. All of them had been awarded prestigious accolades.

Satyam was awarded the Golden Peacock Award for excellence in corporate governance just months before its fraud was uncovered. Elizabeth Homes, CEO of Theranos, was featured on the cover of Forbes in 2014, just a year before her fiction began unravelling. Yes Bank was awarded ‘Bank of the Year’ in 2015, DHFL won a ‘Best Housing Finance Company’ award, etc.

You get the gist. They had yet another sinister commonality. Each espoused ‘Integrity, transparency and authenticity’ as the core values of its company culture.

So, in supreme irony, the leaders of these companies were lying straight faced, (some under oath), while preaching those exalted values to employees and stakeholders. But that is not the point. The point is that ‘dashboards’ put in place to ensure transparency and authenticity not only failed, but were rigged to paint a picture so false that shareholders, analysts, oversight boards and even industry bodies that were supposed to assess these companies objectively, were beguiled.

While the above examples are of extreme failures, many companies have a huge gap between what they state and what they practise. No wonder the rank and file of such firms have little faith in management declarations. The senior management and boards of large organizations rely almost entirely on ‘dashboards’ to track and measure progress on their stated intent.