The Performance Prism: The Scorecard for Measuring and Managing Business Success

This book takes a radically different look at performance measurement and sets out explicitly to identify how managers can use measurement data to improve business performance. The key features of the proposed book are: * Critical reviews of the major measurement frameworks available today - including the balanced scorecard, the business excellence model and shareholder value analysis. * Introduction of a new measurement framework - the performance prism - that addresses the shortcomings of the exisiting measurement frameworks. * Explanation of the tools, techniques and methodologies that can be used to measure stakeholder satisfaction, strategies, processes, capabilities and stakeholder contribution - the five facets of the performance prism. * Explanation of how managers can make the most of their measurement data. Specific discussions about how managers can analyse business performance data and identify appropriate improvement priorities. OUTLINE Chapter 1 - The Measurement Crisis This chapter will explore why measurement is on management's agenda and review recent developments in the field. A key theme in the chapter will be the changing nature of the measurement crisis. In the 1980s, when people first started worrying about the effectiveness of their measurement systems, the problem was that we were measuring the wrong things. Today the problem is that we are measuring too much. The chapter will explore this theme and encourage management to take a step back and think clearly about what they want from their measurement systems. Chapter 2 - The Measurement Frameworks This chapter will review the major measurement frameworks that are available today and identify their strengths and weaknesses. Frameworks to be covered will include the balanced scorecard, the business excellence model, shareholder value. A key theme that will run throughout the chapter will be the fact that each of these measurement frameworks offers a partial view of business performance. Chapter 3 - The Performance Prism This chapter will introduce a new, comprehensive measurement framework - the performance prism. The prism looks at measurement from a stakeholder perspective. When deciding what to measure managers have to first identify who their stakeholders are and what they want and need. Only then can they begin to decide what they should measure. Many of the existing works on measurement fail to recognise this, with numerous authors suggesting that measures should be derived from strategy. Measures should be consistent with strategy, but they should not be derived from strategy. Organisations have strategies because they want to deliver value to stakeholders. Hence the starting point for any discussion of measurement has to be stakeholders. The chapter on the performance prism will build upon this theme and explain how the performance prism provides a structure that encourages managers to answer five inter-related questions when designing their measurement systems: * Stakeholder satisfaction - who are the stakeholders and what do they want and need? * Strategies - what strategies do we need to deliver value to stakeholders? * Processes - what processes do we require to deliver these strategies? * Capabilities - what capabilities do we require to execute these processes? * Stakeholder contribution - what do we want and need from our stakeholders to enable all of the above to happen? Chapter 4 - Measuring Stakeholder Satisfaction This chapter will explore developments in the measurement of stakeholder satisfaction - investors, customers, employees, suppliers, regulators and local communities. Chapter 5 - Measuring Strategies This chapter will explore developments in the measurement of strategy - especially execution and effectiveness. Chapter 6 - Measuring Processes This chapter will explore developments in the measurement of processes - especially those associated with generating demand, fulfilling demand, developing new products and services and planning and managing the enterprise. Chapter 7 - Measuring Capabilities This chapter will explore developments in the measurement of capabilities - combinations of technology, people, practices and infrastructure. Chapter 8 - Measuring Stakeholder Contribution This chapter will explore developments in the measurement of stakeholder contribution - investment levels, customer and employee loyalty, supplier performance. Chapter 9 - Analysing Performance Data This chapter will build on the previous chapters by illustrating how performance data can be analysed once the data has been captured. Various tools, techniques and methodologies will be discussed and explained. There will be a strong emphasis throughout the chapter on the practicalities of making the most of measurement data. Chapter 10 - Improving Business Performance This chapter will concentrate on how to drive improvements in business performance following a systematic analysis of the data. Practical examples will be offered throughout that will illustrate how particular firms have used their measurement data. Appendix - The Measures Catalogue The authors have been working together over a period of months to construct a catalogue of best practice performance measures that identifies specific measures of performance that organisations can use to monitor their progress. The catalogue is structured around the performance prism framework and is currently available on the web (www.cranfield.ac.uk/som/cbp). While it would be impossible to include a paper copy of the catalogue as an appendix, it might be possible to offer it on a CD as further value added feature of the book.