The Performance Organiser Integrating Techniques.

The Performance Organiser

Integrating Techniques……….

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Designing and Building a Performance Management System

Concepts (1)…..•There are no mandated and internationally agreed methods for designing and writing “strategy”•A strategy should be based on an organisations core capabilities and values.•A strategy should have clear and unambiguous objectives that define where the organisation wants to go.•Objectives should be grouped into, short term “tactical” and long term “strategic”•The steps that need to be taken to reach objectives by default are processes•Each and every process will have a “measurable transaction” of one form or another

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Concepts (2) …..•Strategy will cascade (higher level objectives, will affect lower level action and in turn generate lower level objectives and processes).•It should be possible for each and every organisation member to identify his or her place in the scheme of things•Mission and Vision statements are not advertising slogans

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Concepts (3) …..•Performance Measurement should be designed from the outset to support strategy•Performance Measurement is about continuous improvement of a “system”•To design a PM system, it is fundamental that there is a structured coherent business planning system in place•There are no mandated and agreed standards in this field, there is no route map…•Therefore, adopt and adapt accepted best practice…


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Concepts (4)…..•When writing strategy, one of the key aims must be to get the best value out of all available resources to achieve your aim.•When writing strategy, “cause and effect” should be born in mind•Performance measurement must provide the means to show the interrelationship of “cause and effect”•Performance measurement should prompt investigation, not blame….•Performance measurement is a “systems” tool.•Performance measurement is about identifying best practice as well as systemic failure


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Money

Assets

People

If you cannot measure ityou cannot manage it and

you cannot do either without the passage of information

The Problem


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Concepts (5)…..•Many organisations do not have a coherent planning mechanism in place•Where mechanisms do exist, they are often based on techniques like ISO 9000 or the EFQM•ISO 9000 and the EFQM are often applied in isolation•There is often duplication of effort, EFQM people doing similar tasks to ISO 9000 people•Apply some joined up thinking……….


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UK Government “Quality” Initiatives

• ISO 9000

•Investors in People

•The European Foundation for Quality Management Model

•The Balanced Scorecard

Actively Sponsored and Promoted by the Cabinet OfficePerformance and Innovation Unit


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ISO 9000

Process Based, guiding principleis:

Say what you do and how you do it.

Strong on procedures, supported byexternal and internal audit.

ISO 9000 concentrates on what isand not on what could be


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Investors In People

People based

The guiding principle is the proper managementof human resources

Concentrates on personnel issues

Lacks a cohesive analysis approach.


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EFQM

General purpose analysis techniquebuilt around the principle of

“Review to Improve”

Forces an holistic approach toexamining the way a business works

and its effect on society

Once you have done the analysis, what do you do with the results?

How do you monitorimprovement?


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The Balanced Score Card

Economic(Accounting Measures)

Efficient(Benchmarking etc.,)

Evolution(Legislation,

Modification Programmes)

Effective(Customer Satisfaction)

A very powerful reporting

mechanism based on key

performance measures.Strong on the use of “hard” information

No standards, KPI definitionis difficult.


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Planning Framework…………………………………...

Charter

Mission

Objectives

Process

Resource

Vision


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The EFQM provides a structured analysis methodbased on the concept of “review to improve”.The main advantage is that it forces a “whole

view” approach to be taken of the way an organisation works.

One of the Key Products of the application of the EFQM

is a set of objectives, that should in principle be built around the concept of improving on the

current situation….


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Planning Framework Including The EFQM

Charter

Mission

Objectives

Process

Resource

Vision


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EFQM derived objectives can then be broken down

into individual steps to achieve a business aim .

Each objective step is a process. ISO 9000 provides

the standards framework on which to base process monitoring


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Planning Framework Including ISO 9000

Charter

Mission

Objectives

Process

Resource

Vision


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IIP fills a similar function to ISO 9000.Where ISO 9000 concentrates on process, IIP

concentrates on Human Resources (HR).

IIP provides the framework on which to manageand document HR issues.


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Planning Framework Including IIP

Charter

Mission

Objectives

Process

Resource

Vision


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The EFQM, ISO 9000 and IIP arenot in themselves reporting mechanisms


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The Balanced Score Card

Economic(Accounting Measures)

Efficient(Benchmarking etc.,)

Evolution(Legislation,

Modification Programmes)

Effective(Customer Satisfaction)

The Business Balanced

Scorecard provides a reporting

approach thatcan be cascaded

through an organisation, providing the

“face” of a business

based information strategy


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Planning Framework Data Collection and Delivery

Charter

Mission

Objectives

Process

Resource

Vision

KPI’s


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•Balanced scorecards are based on the principle of measuring “What you need to know” through the medium of Performance Measures or Indicators

•Using the planning structure described Performance Measures can be defined as

“The point at which a measurable transaction can be identified in a business process that is deemed critical to the achievement of an objective”

•A Performance Measure should be an achievable mean but with tolerances set in such a way as to identify success or failure.

Performance Measurement


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•As an integral part of the definition of a Performance Indicator you should describe:

•The primary data sources•The measurement technique (Activity Based Costing, Shareholder Value etc)•Any “Bad Behaviour” that meeting targets set for the indicator may cause.•The frequency with which measurements should be taken



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•Performance Measures can be used for•Processes (data collection)•Resources (performance reporting)•Organisation Elements (meeting objectives)

•Performance Measures should be applied both internally and externally to assist in the definition and monitoring of:-

•Agreed Levels of Service Delivery(SLA)•Output Quality (Fitness for purpose)



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Board

Senior Management

Middle Management

Shop Floor

Strategy

Action

Top Down Analysis, Bottom Up Reporting


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Suggested Information

System architecture after

structured business analysis using the EFQM with IIP and ISO

9000, built around Balanced

Scorecards (Please note

paper based and electronic systems

are equally of value and should

be included)

Data Acquisition

Feeder systems (Data Collection)

Decision SupportBusiness intelligence systems

(Cross Quadrant Links)

Management Information

Day to Day Management Information (Data Delivery)

Drill Down

Drill Down

Resulting Information System Structure


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Summary

Use the ISO 9000 and IIP to provide the method and

standards against which to define

indicators and their application

Use the EFQM as an analysis technique

Use the Balanced Scorecard to define

the reporting mechanism apply the appropriate measurement

technique


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Containing as it does the ability to model•Organisation Structure

•Objectives•Processes (including resource, supplier and

customer interfaces)•Scorecards (data collection at process, data

delivery at organisation element)The “Performance Organiser” is one of the most

cost effective tools of its type capable of supporting the principles outlined in this slide

show

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•Useful URLs

•www.jit-software.com for The Performance Organiser•http://www.jit-software.com/porg/porgsgle.exe for a Performance Organiser evaluation license•www.balancedscorecard.org, US Government sponsored site dedicated to performance management in the public sector•www.cranfield.ac.uk/som/cbp Cranfield University Centre for Business Performance sponsors and manages the Performance Management Forum.

Finally


The Performance Organiser Integrating Techniques.

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