Business Performance Management (Setting Target Values (association…
Business Performance Management
refers to the business processes, methodologies, metrics, and technologies used by enterprises to measure, monitor, and manage business performance
a set of integrated, closed-loop management and analytic processes, supported by technology, that addresses financial as well as operational activities
tools for businesses to define strategic goals and then measure/manage performance against them
BPM Methodology: Balanced Scoreboard
a holistic measurement system for aligning strategies with actions based on 4 perspectives: Financial, Customer, Internal(process), Learning and Growth
Closed-loop Process to Optimize Business Performance
Step 2. Plan: How Do We Get There?
Step 3. Monitor/Analyze: How Are We Doing?
Step 1. Strategize: Where Do We Want To Go?
Step 4. Act and Adjust: What Do We Need To Do Differently?
Performance Measurement System
a system that assists managers in tracking the implementations of business strategy by comparing actual_results against strategic goals and objectives
Key Performance Indicator (KPI)
represents a strategic objective and metric that measures performance against a goal
Developing Strategic Foundation
Assessment of internal and external environment: PESTEL, SWOT, Porter's 5 forces may also be used
Formulation of Strategic Themes
Before creating a BSC, develop a strategic foundation consisting of: Mission, Vision, Values
a visual representation of what the execution team believes will drive its strategy
shows a chain of objectives that will lead to successfully executing the strategy
4 perspectives: Financial, Customer, Internal Operations, Learning and Growth
collections of actions or projects designed to achieve the Strategic Objective
current initiatives and brainstorm for new initiatives that support the objectives
rationalise current initiatives
Setting Target Values
best practice surveys from private consulting firms
horizontal comparison between similar business units in your organisation
best estimates from a panel of experts
Historical tracking and benchmarking of organisational data
regulatory benchmarks set by legislative agencies