Developing Meaningful Measures

The Client:

Our client is a transaction processing company.

The Challenge:

Our client had embarked on developing performance measures using the Balanced Scorecard tool. However, measures selected were unbalanced, short term and operational in nature. Effectively, there was little link between the organisation’s strategy and its performance measures. The glaring questions were – Why are we doing this? How is it benefiting us?

The Solution:

Our premise:

Performance measures should cascade from the organisation’s strategic objectives. They should be balanced covering all 4 quadrants of the scorecard. The measures may be qualitative or quantitative, but they should be meaningful and easy to measure.

What we did:

Tier 1: Defining organisation scorecards

  • Involved senior management and board members in clarifying the organisation’s strategy and the desired picture of success.
  • Conducted a senior management workshop to define specific performance measures at organisation and division level.
  • Finalised organisation and divisional scorecard to get a clear big picture.

Tier 2: Cascading goals to individual level

  • Conducted cascade workshops and coaching clinics with business heads to cascade the divisional measures to individual levels.
  • Linked the performance measures to the performance management system.
  • Aligned performance measures to the rewards framework.

The Result:

There was clarity on performance measures as they were linked to the organisation’s strategy.Managers had a clear line of sight on how they could make a difference. There was a higher acceptance of the performance measures across the board.