Statistics Collection and Presentation Program
Last Revised: May 23, 2012 4:50 PM
Necessity Level And Responsibility
How do you count the money?
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Mr. Hubbard defines a statistic as:
the relative rise or fall of a quantity compared to an earlier moment in time. If a section moved ten tons last week and 12 tons this week, the statistic is rising. If a section moved ten tons last week and only eight tons this week the statistic is falling.
a number or amount compared to an earlier number or amount of the same thing. Statistics refer to the quantity of work done or the value of it in money.
a tight realty, a stable point, which is to measure any departure from the ideal scene.
a positive numerical thing that can be accurately counted and graphed on a two dimensional thing.
the statistic measures directly the relative survival potential of the organization or its part.
the only sound measure of any production or any job or any activity.
the most direct observation in an org (or a country) is statistics. These tell of production. They measure what is done.
a difference between two or more periods in ti9me so is always comparative.
the independent continuous survey of production or lack of it.
a stat actually should consist of volume, quality and viability.
For many years Vibrant Life has well defined, but few, statistics. These have been VSD, GI, Particles In, Retail Sales, CGI and New Names.
The definitions of those terms are at the links for each word.
One Project is the Statistical Analysis Project started but incomplete
Here is a legacy description taken from an old but valid Company Policy.
This Company Policy describes the role of “statistics” in our Company.
When a person is working as a “one-man-company” he will not have staff to divide the job up for different people. However, he will still have to divide his time on, for instance, selling, production, administration and whatever other divisions seem necessary for that company.
Many types of employment are on terms called “sub-contract” where someone, for instance a janitor, has the job of cleaning an office. The janitor gets paid for producing a clean office, not for some number of hours of cleaning activity. While the company supervisor may judge “how clean” the office needs to be for the janitor to get paid, ultimately the client decides whether HE is happy with the product.
The janitor gets only part of what the client pays because someone else “produced” the original sale, inspected the finished job, or did the bookkeeping that keeps track of things.
I use the term “product” to describe various “things” which are important parts of the total company activity.
Thus, there is a “sale” which is a product.
A “cleaned office” is a product for the janitor.
A “collected bill” is a product for the bookkeeper.
These are always phrased so that they are nouns – a finished thing. Something that “has been done,” and is completed.
A half-clean office is not a product.
When it becomes more and more complicated to see what “product” is produced by a staff member, we fall back on the very much less useful measure of “an hour of pay for an hour of work.” Even though we may “measure” a staff member’s contribution to the Company in terms of hours or weeks, we try, even so, to see the truth of what was produced by that employee – something produced which is valuable to our customers – or valuable to some other part of the Company in order to produce something valuable to a customer.
For this reason we strive to define one or more “products” for each staff member – a definition that relates to “things” which are brought into existence by the person and which are somehow traceable to a benefit, directly or indirectly, to our customer. Whatever these products may be, we then count them and compare the count for one period with the count for another similar period.
This is our definition of a “statistic.”
It is a number of something that has been produced compared to another number for a different (usually previous) similar time period, same item being counted.
So, we can measure sales for one week. That would be a number, not a statistic.
When we have sales counted for one week, then another count for sales in the next week, those TWO numbers constitute, for us, a “statistic.”
A statistic is always a comparison of the count of some item, generally counting in two different time periods of the same length.
We had sales of $10,000 last week, and sales of $12,000 this week. The statistic involves both numbers. The statistic is “rising” since the more recent number is higher than the earlier number.
Sales would seem rather easy to define and measure. But how about a company where a salesman makes “sales calls.” Perhaps he also writes “proposals.” Perhaps he has “call backs.”
In other words a “sale” might be the final result of several prior actions – let’s call the “sale” a final “product.” Then, the prior actions could be described in terms of “things” and called “sub-products.”
When you get a certain number of the sub-product called “proposals delivered,” you would expect to get some number of “sales.”
It would be useful to figure out what are the significant “sub-products” for each final product that we want to count.
Every company will undoubtedly have “sales” as one of its important statistics – for measuring how well the company is doing. If the sales statistic is constantly rising, we can expect that the company is doing well.
But, for instance, if the cost of production is also rising, then sales could be a nice rising statistic while profit is falling because of increased costs.
So, putting together the items by which you can measure the overall health of the company is an important part of management. Each of these items may well then have a series of sub-products and each of these sub-products should then also have a statistic.
If Bob, the salesman, is not making sales, is it because he is not making calls? Or not making proposals? Or, not making follow-up calls? Or what?
We figure out what it takes to get the sale, define these sub-products carefully, then count them and put the statistics on graphs. If the statistic for “calls” and “proposal made” and “follow-up calls” are all going up, yet the sales statistic is going down? There might be some error in figuring out what the sub-products should be, or whatever.
So, this is a management system which proves itself to be useful. It is a system that must be changed when the statistics (and the definitions for those sub-products) are not producing a constant increase in the final statistic – for instance “sales.”
Through years of experience I have concluded that there are several items that will measure the health of Vibrant Life.
Certainly sales is an important one, but the word “sales” is nowhere near specific enough without careful definition.
For instance, do we include the cost of shipping in “sales?” How about the sales tax? Do we include the retail price or the discounted price? Do we count it as a sale when the customer doesn’t pay? How about a package lost in shipping? There would be many questions about how to define each product we use in managing the Company.
This Policy does NOT define these terms, but lays out the framework and background.
Thus, we do not use the word “sales,” except in a loose sense. We use, instead, the “Value of Service Delivered.” There is a separate Company Policy to define this term.
It happens that the Value of Service Delivered, or VSD for short, is one of the most important statistics in our Company. The computer program is designed to give us the VSD any time we ask. After an hour or two, and we have entered some new orders into the computer, the computer will then produce a “statistic report” that includes the VSD as of that minute. We could print out a statistic sheet several times a day, if we wanted them.
The statistic report is designed to show the count (in dollars for VSD) for a time period that has been pre-selected, and to compare that count with a similar previous time period.
We arbitrarily define a “work week” for Vibrant Life as from the close of business on a Friday to the close of business on the next Friday – seven days.
So, we can have a VSD statistic on a Thursday, for instance, at 11 AM. The computer does not give out the previous Thursday 11 AM figure, but rather gives out the previous Thursday figure for the end of that day.
When we look at the statistic report on a Thursday, we know that “today’s stat is as of a certain hour, shown on the report” while the previous Thursday would always be the “end of business” on that day.
Thus, a person can have the job of receiving requests for literature, entering the information into our computer, stuffing an envelope with the literature, and taking that envelope to the post office. We could count these with a term called “literature requests handled” or some such. If we were large enough we might have one person who did ONLY “literature requests.” That staff member would then have a personal product – “literature requests handled.”
If we were clever enough we could figure out how much one such product was “worth” to the Company and actually pay THAT amount rather than some arbitrary amount related to time. Then the person who worked faster and more efficiently could earn more in the same time, by producing more of this personal product – literature requests handled.
A system that pays for time only rewards the lazy and penalizes the fast worker because they both get paid the same – but the actual “product” is different. In the real world it is hard to come up with practical ways of measuring production so we fall back on “time.” To try to handle this we have a “supervisor” whose job it often is to observe, train and motivate people so they can actually produce more valuable products in less time. Likewise, a staff member who does this, with or without supervision, is the one who is likely to be promoted and get increases in pay.
Increasing pay on the basis only of time on the job is common, but surely one of the worst possible criteria to use. We expect a staff member to be constantly increasing his knowledge and skill. Increased productivity should be the basis for increased pay, not time on the job.
As an example, consider a person whose job is handling literature requests. The person who is not well trained may put the wrong postage on an envelope and it is then returned. This was a harmful product for the Company. The prospect did not get the information requested and we had to pay extra to send the literature the second time. A person who is well trained and alert will notice something that needs correction, even from the customer’s own data, and ensure that the outgoing envelope will actually arrive in the customer’s hands.
Paying both of these people the same amount for time would be a terrible way to pay, but unfortunately it is probably the most common method – to pay on the basis of time.
As imperfect as they may be we try to come up with some “product” for each person, or even several products. The pay may not be tied to the quantity of these products created, but even so the statistic on that quantity is important in the management of the Company and the prospective increase in pay for the staff member.
We are generally very generous about allowing time off for any reason, as long as you get approval from your senior in advance and make up the missing time. Time off should not be taken at times when the work flow is particularly heavy, and made-up time should be on a schedule so that productive work can be done (late hours, weekend time, or whatever). Make-up time can often be scheduled for weekends if that is preferred by the staff member.
While the “normal” hours are from 9 AM to 6 PM, with an hour off for lunch, many staff, with approval from the senior, find that it is very workable to work from 9 to 5 PM and to “take lunch on the fly.” We do not want to get into watching the hours or counting the minutes.
There may be times when there is work to do, past the normal quitting hour. We expect that you will be willing and able to do that, and get comparable time off on some other day. This has not been much of a practice in Vibrant Life, but is common in other companies. When and as there is more of an "owner's attitude" amongst staff members, this should change.
There are certain "end of the week" tasks which must be done before close of business on Friday. It should be possible to do all of those during the week and within the normal hours, but if not, you would be expected to spend whatever additional time is needed to get those tasks completed on a Friday.
We have an outside payroll processing company. They process pay checks weekly and we usually receive those paychecks on Saturday, dated for the following Monday. Thus, the work week goes from Saturday through the following Friday, and the pay for that period is given to you on the following Monday. Normally you would receive your check on a Monday.
We have a variety of cash bonuses.
We measure “sales” by a term called “Value of Service Delivered,” or VSD. We have a computer-based statistical program that produces this VSD figure as often as we want it, and keeps track of the VSD for past periods. We measure the VSD, normally, on an hourly, daily and weekly basis.
When the VSD is higher than it has ever been for any one week (ending on Friday, close of business) each person on the staff gets a $100 bonus. When it is the highest ever amount for two weeks in a row, each staff member gets a $200 bonus. When the VSD is “highest ever” for three weeks, or longer, consecutively, the bonus is $400 in cash for each staff member. If the VSD continues to be “highest ever” after that third consecutive week, the weekly bonus remains at $400.
We have another statistical figure, called the “Corrected Gross Income.” You can learn more about that from another Company Policy. Whenever that statistic rises for two weeks in a row, there is a $50 bonus for each staff – paid in cash. The bonus could be paid every week, as long as the two preceding weeks saw an increase, both weeks. The amount of the bonus doesn’t change.
A person who is on paid vacation also gets these bonuses, but not the next item.
In addition to these bonuses, there are occasional other bonuses, usually announced by me, Karl Loren, or by the ED, Maia Mulvena. These are not cash bonuses, but rather “rewards” based on achieving some particular target that is generally set at the beginning of the week.
In other words, at the beginning of the week I might announce that, “If and when the VSD reaches $15,000, or higher, by Friday, close of business” the reward will be given to all staff.
Typically this reward has consisted of all the staff going to a very nice spa for some hours and then a fancy restaurant for dinner. Sometimes, for a particularly high target, the spa could also include massages for all who wish them.
We may have other bonuses or rewards.
In addition to the above, the Company offers all who work here the opportunity of a breakfast every morning that our Housekeeper is working. She normally works from Tuesday through Fridays. On those days, approximately at 9 AM or so, we all sit down to a pleasant breakfast, eggs of your choice and all the other items that would accompany eggs.
Every staff member is expected to get enough rest and food before coming to work. Arrival at work in a condition of being tired or hungry is not acceptable. The morning breakfasts are the Company approach to ensuring that your morning meal is adequate and nutritious.
Staff are hired on an “at will” basis – which means they can be dismissed without notice or cause, at any time. In fact, we follow the Company Policy that you are expected to give a one-week notice if you wish to leave, and that the Company will give you a one-week notice before dismissal.
The job includes a complimentary set of vitamins (created by Vibrant Life) worth $200 at retail, per month, for each staff member, with any additional vitamins available at a 50% discount. We will be interested in staff health from the point of view of their talking to customers about health, and about diet and exercise. They should be in a personal position to encourage our customers to follow healthy habits, as recommended by Vibrant Life. Thus, this “vitamin allowance” is for the staff member’s personal consumption not for sale or gift to another, including the staff member's children.
Staff can simply take whatever vitamins he or she wants, up to $200, enter that transaction into the computer as an "order" and show zero for the amount of money involved. (This will preserve the statistics on what bottles of our products are taken from inventory.)
Relative to "correction" of statistics, the vital importance of "statistics" in the first place is to allow their use within the Hubbard Management System, and an activity that should go on regularly -- weekly for instance. That activity is to analyze the "condition" of a statistic using Hubbard Policy on graphs and "conditions formulas."
When the road could go in many different directions, which is correct?
It can certainly happen that the VSD, for instance, is shown to be some particular figure on a Friday, close of business. The VSD, then, using that statistic, would be analyzed as to the "condition" to be applied within the Hubbard Management System. The accurate analysis of the "condition" is a vital part of management and expansion. If someone entered a sale as $1,000 when it should have been $100, a simple error, the condition based on that false statistic could be a false condition. An error like this might go undetected for ever? It might be found the same day it was made, or any other time.
The simple but invariable Policy is that ONLY "corrections" that are found to be needed in the SAME week the error was made should be made so as to affect that week. This way the "condition analysis" for the SAME WEEK will be based on the corrected data.
However, an error found in one week that relates to an earlier week can be noted as an explanation of why a "condition analysis" may have been faulty, but the actual statistics are NOT changed for the original week in which they occured, and only those affecting GI are taken into account in something called the "corrected gross income" in whatever week they were found (for errors that relate to GI).
One of our ongoing activities, based on one of our web sites, is to encourage people to ask for and receive free copies of a common sense moral code, called The Way To Happiness. This is a moral code, and as such, it should not be enforced. Nonetheless, we give each staff member a copy of this Book and he or she should understand that we like to validate moral behavior and frown on immoral behavior, as defined in this Book.
Quotes from L. Ron Hubbard are copyright 1994 © by the L. Ron Hubbard Library. All rights reserved.