Management By Fact

Organizations depend on the measurement and analysis of performance. Such measurements should derive from business needs and strategy, and they should provide critical data and information about key processes, outputs, and results. Many types of data and information are needed for performance management. Performance measurement should include customer, product, and service performance; comparisons of operational, market, and competitive performance; supplier, employee, cost, and financial performance; and corporate governance and compliance. Data should be segmented by, for example, markets, product lines, and employee groups to facilitate analysis.

Analysis refers to extracting larger meaning from data and information to support evaluation, decision making, and improvement. Analysis entails using data to determine trends, projections, and cause and effect that might not otherwise be evident. Analysis supports a variety of purposes, such as planning, reviewing your overall performance, improving operations, change management, and comparing your performance with competitors’ or with “best practices” benchmarks.

A major consideration in performance improvement and change management involves the selection and use of performance measures or indicators. The measures or indicators you select should best represent the factors that lead to improved customer, operational, financial, and ethical performance. A comprehensive set of measures or indicators tied to customer and organizational performance requirements represents a clear basis for aligning all processes with your organization’s goals. Through the analysis of data from your tracking processes, your measures or indicators themselves may be evaluated and changed to better support your goals.