Developing strategic performance management systems E 3 Chapter
- Slides: 10
Developing strategic performance management systems E 3 – Chapter 9
Why is performance management important?
Critical Success Factors “Something which must go right if the objectives and goals are to be achieved” Changes to performance management: * Indicator overload * Changes can give the wrong message
Financial & Non-Financial measures Financial Measures * Sales margin * Net profit margin * Return on Equity Advantages: Advantages * Culturally expected * Focus on financial objectives * Comparable across companies * Cheap * Established framework * Tend to focus on resource generation Disadvantages * Inflation distortion * Leads to sub-optimal behaviour * Lack of comparability * Cheap * Understood by select few * Subjectivity can exist Non-financial measures * Wider view * Easier to calculate * Easy to understand * Not distorted by inflation * Positive motivational implications Disadvantages: * Sometimes difficult to calculate * Subjectivity exists in design * Costly * Culture clash
The Balance Scorecard
Performance Pyramid
Benchmarking video
Divisional Performance & Transfer Pricing SVA TP video
Employee buy-in Understanding how to meet targets Explain the impact of missing targets Stretch Goals Getting feedback
Problems with performance management How to coordinate BU’s Dependancies Controllability Goal congruence Transfer Pricing Head office costs Suboptimisation
Resource based model
Cultural aspects of strategy choice
Strategic management performance system
Performance management and strategic planning
Developing competitive advantage and strategic focus
Developing a strategic prospecting plan
Chapter 11 performance appraisal - (pdf)
Disadvantages of bell curve in performance appraisal
Performance management and reward
Developing spreadsheet-based decision support systems
Example of the acquiring information system novel plan is
