Time magazine in their 2 November issue published a very interesting essay. The author, Steven Faris, argues that using GDP (Gross Domestic Product) to judge how well a country was doing is wrong and misleading. The idea behind GDP was only to show how much money is changing hands, nothing more, nothing less. Should we not use a metric that actually measures the things we really care about, he asks.
To illustrate the inadequacy of GDP to measure what we always thought it did, he gives a few telling examples. Natural disasters, oil spills, car crashes, riots, crime: anything you pay to fix will boost GDP. Helping a neighbor up the stairs, skipping work to see your son’s basketball game or walking in the woods will not.
Reading the essay it occurred to me that in air traffic management we have our own ingrained GDP equivalent, the famous KPIs or Key Performance Indicators. True, GDP was devised by economist Simon Kuznets at the end of the Great Depression (not the current one but the one before it…) and the KPIs for things like the SESAR project were put together within the last five years. They should be ok… Well, I am not so sure.
Are we really sure that the KPIs for air traffic management were defined keeping in mind a system where navigation accuracy will improve to +/- 10 seconds and were information will be shared across the system, making everyone a node on the network, in principle working off the same situational awareness basis. Do the KPI’s account for the fact that a poorly managed, inefficient airline consumes the same, or more, ATM resources as an efficient, well managed one, yet this latter will not reap real benefits even while the “GDP” of the ATM system will show growth…
As Steven Faris points out, if you pay a company to clean your floors, you are contributing to the GDP. If you do it yourself, you do not. Clearly, GDP sucks.
Are we really sure that our KPIs for ATM are the metric for the well-being of the air traffic management industry or are they, like the GDP, just a relic of the type of thinking that is based on the past (something we understand) instead of being based on the future (which we are trying to create).
I do not have the answer but there is certainly an important message in the fall of the GDP. We should measure what we really care about and not simply what we could agree on.