Financial numbers may tell us we’re winning the war,
but it takes performance management to show us how to focus our
energy and efforts to win each of the battles along the way.
a good friend and coworker, once said, "You can’t control what you
don’t measure". Imagine trying to fly an airplane across the country
and the cockpit had no dashboard, no gauges and no idiot lights. You
may get it up off the ground but without Performance Measurement the
chances of getting to where you want to go are slim to none.
Business success may not be a life-death situation but like piloting
an airplane it takes Performance Measurement to get you to where you
want to go.
measurement training can be motivational or de-motivational. The
individual goal setting of the 80’s is a good example of
de-motivational measurement – it tested one individual or group
against the other, and while satisfying some individual egos, it
provided little contribution to company growth and profit
the performance scorecard is a performance measurement system that
helps companies pursue their key success factors. The scorecard uses
both internal and external benchmarking and employs a relevant
cascading method of performance goal setting. Achievements are
acknowledged and celebrated on a "real time" basis and not at the
traditional annual review.
balanced scorecard process to be motivational it must provides
timely and accurate data. Simplicity is a key to the validity of
measurements and the tractability of problems to their root cause.
Data collection design must employ simple and easy to maintain
databases to assure data integrity. When people are trained in this
process and are permitted to participate in relevant goal setting,
performance measurement can motivate teams to higher achievements –
including the exceeding of growth and profit expectations.
key elements of the balanced
scorecard training are:
Establish a "no status-quo" mind-set – if you’re not winning, you’re
Define company "key success factors" – examples: cost, speed and
Identify stretch goals that are relevant to the company’s "key
Implement training/coaching programs – education is the pathway to
Celebrate each goal achievements and raise the bar - don’t wait
until next year.
mature performance management process, "benchmarking" has become the
standard for establishing performance objectives.
Benchmarking is still one of the most ill-defined management
concepts and is one of those words that mean different things to
different people. Our preferred definition comes from Xerox, who
describes benchmarking as: "the continuous process of measuring our
products, services and business practices against the toughest
competition and those companies recognized as industry leaders".
objective of benchmarking is to build on the ideas of others to
improve future performance. The expectation being that by comparing
your processes to best practice – major improvements can be
realized. You should not consider carrying out external benchmarking
until you have thoroughly analyzed your internal operations and an
effective system of internal measurement has been established.
kind of results can you expect when a management team introduces the
process of the balanced scorecard? First, people will become
motivated and focused on the continuous improvement of their
company’s critical success factors. Second, personal and team
achievements will become recognized and rewarded – creating an
exciting, winning, work environment. Teamwork will improve and
employee retention will rise. Finally, and most important is the
company-wide euphoria as "bottom line" results improve and financial
pressures no longer create a stressful and defensive work
About the Author: Bill Gaw is the founder of Business Basics, LLC and a "been there, done that" lean enterprise advocate. He is the developer of six e-training packages and seven e-training modules published to help individuals and companies reach their full growth and earning potentials. His company specializes in Lean Manufacturing Training.