strategy by measurement
DESCRIPTION
Strategy is not new for many business executives. Yet, many few companies can truly link their strategy to action. Organizations need to implement EPM based on a measurement system to empower people, process and technology to deliver what is strategized!TRANSCRIPT
Strategy by MeasurementFrom Butterfly Effects to Success
Atif Abdul-Rahman
A single flap of a butterfly’s wing CAN lead to a tornado elsewhere…
A SINGLE measure in a company can make or break the business.
Although a bit exaggerated, many companies have seen similar effects…
Strategy by Measurement
Strategy
Strategy
…is the plan to act
Strategy
…is the plan to act
Act…to achieve goals
Strategy
…is the plan to act
Act…to achieve goals
Goals…that define Purpose
Purpose
Purpose
“A group of people get together and exist as an institution that we call a company so they are able to accomplish something collectively that they could not accomplish separately, they make a contribution to society,
Do something which is of value.”-David Packard
Purpose
“A group of people get together and exist as an institution that we call a company so they are able to accomplish something collectively that they could not accomplish separately, they make a contribution to society,
Do something which is of value.”-David Packard
The Vision…
Purpose
“A group of people get together and exist as an institution that we call a company so they are able to accomplish something collectively that they could not accomplish separately, they make a contribution to society,
Do something which is of value.”-David Packard
The Vision…
The Mission…
Purpose
“A group of people get together and exist as an institution that we call a company so they are able to accomplish something collectively that they could not accomplish separately, they make a contribution to society,
Do something which is of value.”-David Packard
The Vision…
The Mission…
The Core Values…
Purpose
“A group of people get together and exist as an institution that we call a company so they are able to accomplish something collectively that they could not accomplish separately, they make a contribution to society,
Do something which is of value.”-David Packard
The Vision…
The Mission…
The Core Values…
All define the Purpose
Am I meeting my Purpose?
Am I meeting my Purpose?
Am I Successful?
Success
Success
Success is the accomplishment of goals and fulfillment of purpose. It is shared with all stakeholders and is aligned with mission, vision and values.
Success
Success is the accomplishment of goals and fulfillment of purpose. It is shared with all stakeholders and is aligned with mission, vision and values.
Success is exceeding performance
But How to you define Performance? How
Performance
But How to you define Performance? How
Performance
But how do you define performance?
But How to you define Performance? HowBut how do you define performance?How do you track it and then act upon it?
Performance
But How to you define Performance? HowBut how do you define performance?How do you track it and then act upon it?
How do you know that the ‘SYSTEM’ is truly measuring performance?
Performance
• The SYSTEM measures, monitors and manages performance.
• The SYSTEM measures, monitors and manages performance.
• However, The SYSTEM may not be even present in the first place!
Performance
Performance
Measure
Performance
MeasureWhat does it take to succeed?
Performance
MeasureWhat does it take to succeed?
Each business unit has to define its performance based on its strategy, enterprise infrastructure, corporate culture and its environment.
Performance
MeasureWhat does it take to succeed?
Each business unit has to define its performance based on its strategy, enterprise infrastructure, corporate culture and its environment.
By scoring performance, businesses can truly gauge their standings.
Performance
MeasureWhat does it take to succeed?
Each business unit has to define its performance based on its strategy, enterprise infrastructure, corporate culture and its environment.
By scoring performance, businesses can truly gauge their standings.
What Gets Measured, Gets Done!
Performance
Monitor
Performance
MonitorSuccess demands agility, the ability to shift directions, change course of actions and evolve!
Performance
MonitorSuccess demands agility, the ability to shift directions, change course of actions and evolve!
This calls for timely monitoring of performance.
Performance
MonitorSuccess demands agility, the ability to shift directions, change course of actions and evolve!
This calls for timely monitoring of performance.
This gives right time for action, faster decision making and brings the power of control back to the people.
Performance
MonitorSuccess demands agility, the ability to shift directions, change course of actions and evolve!
This calls for timely monitoring of performance.
This gives right time for action, faster decision making and brings the power of control back to the people.
Monitoring gives Business Insight
Performance
Act!
Performance
Act!“Change is the process by which the future invades our lives “ Alvin Toffler
Performance
Act!“Change is the process by which the future invades our lives “ Alvin Toffler
Act & take control of the environment before the environment changes and takes control of
U
Performance
Act!“Change is the process by which the future invades our lives “ Alvin Toffler
Act & take control of the environment before the environment changes and takes control of
U
Develop a plan and execute it!
Performance
Act!
Strategy + Action = Performance
“Change is the process by which the future invades our lives “ Alvin Toffler
Act & take control of the environment before the environment changes and takes control of
U
Develop a plan and execute it!
“Knowing what to measure and how to measure it makes a complicated world much less so. If you learn how to look at the data in the right way you can explain riddles that otherwise might have seemed impossible. Because there is nothing like the sheer power of numbers to scrub away layers of confusion and contradiction.”
That SYSTEM is EPM
EPM = CPM (corporate) = BPM (not process)
EPM
EPM = CPM (corporate) = BPM (not process)
EPM
Enterprise Performance Management
EPM = CPM (corporate) = BPM (not process)
EPM
Enterprise Performance Management
Performance has to be managed!
EPM = CPM (corporate) = BPM (not process)
EPM
It Is a management system which glues strategy and execution together.
Enterprise Performance Management
Performance has to be managed!
EPM Manifesto
PUT STRATEGY TO ACTION
EPM Manifesto
ACT!EPM BENEFITS
ACT!EPM BENEFITS
AGILITY
ACT!EPM BENEFITS
AGILITY
AGILITY CONSOLIDATION TIMELINESS
ACT!EPM BENEFITS
AGILITY
AGILITY CONSOLIDATION TIMELINESS
EPM provides the capability to consolidate financial & nonfinancial data and provide a holistic view between business processes and strategy. This determines the required changes quickly and with completeness.
ACT!EPM BENEFITS
CONTROL
ACT!EPM BENEFITS
CONTROL
ACCURACY CONTROL TOTAL QUALITY
ACT!EPM BENEFITS
CONTROL
ACCURACY CONTROL TOTAL QUALITY
EPM provides companies the mechanism through which they can practice a total quality imitative by connecting their strategy with their control processes and with their operations processes allowing them to establish compliances effectively.
ACT!EPM BENEFITS
TRANSPARENCY
ACT!EPM BENEFITS
TRANSPARENCY
AWARENESS COLLABORATION TRANSPARENCY
ACT!EPM BENEFITS
TRANSPARENCY
AWARENESS COLLABORATION TRANSPARENCY
EPM provides a platform where stakeholders can communicate their performance and can drill down to any KPI from any view all the way to the data sources, processes and applications. This gives the imitative for data quality, enterprise awareness and a highly collaborative work environment
ENTERPRISE PERFORMANCE MANAGEMENTCreating Connections & Synergies
PEOPLE
ENTERPRISE PERFORMANCE MANAGEMENTCreating Connections & Synergies
PEOPLE PROCESSES
ENTERPRISE PERFORMANCE MANAGEMENTCreating Connections & Synergies
PEOPLE
TECHNOLOGY
PROCESSES
ENTERPRISE PERFORMANCE MANAGEMENTCreating Connections & Synergies
PEOPLE
TECHNOLOGY
PROCESSES
ENTERPRISE PERFORMANCE MANAGEMENTCreating Connections & Synergies
PEOPLE
STRATEGY
TECHNOLOGY
PROCESSES
ENTERPRISE PERFORMANCE MANAGEMENTCreating Connections & Synergies
PEOPLE
STRATEGY
TECHNOLOGY
PROCESSES
SHAREHOLDERS
ENTERPRISE PERFORMANCE MANAGEMENTCreating Connections & Synergies
PEOPLE
STRATEGY
TECHNOLOGY
PROCESSES
SHAREHOLDERS CUSTOMERS
ENTERPRISE PERFORMANCE MANAGEMENTCreating Connections & Synergies
PEOPLE
STRATEGY
TECHNOLOGY
PROCESSES
SHAREHOLDERS CUSTOMERS
ENTERPRISE PERFORMANCE MANAGEMENTCreating Connections & Synergies
PEOPLE
STRATEGY
TECHNOLOGY
PROCESSES
SHAREHOLDERS CUSTOMERS
ENTERPRISE PERFORMANCE MANAGEMENTCreating Connections & Synergies
EPM LIFECYCLE Performance Dashboards, Wayne W. Eckerson, Wiley
EPM LIFECYCLE Performance Dashboards, Wayne W. Eckerson, Wiley
1.STRATEGIZE
EPM LIFECYCLE Performance Dashboards, Wayne W. Eckerson, Wiley
2. PLAN
EPM LIFECYCLE Performance Dashboards, Wayne W. Eckerson, Wiley
3. MONITOR/ANALYZE
EPM LIFECYCLE Performance Dashboards, Wayne W. Eckerson, Wiley
4. ACT/ADJUST
EPM LIFECYCLE Performance Dashboards, Wayne W. Eckerson, Wiley
1.STRATEGIZE 2. PLAN
3. MONITOR/ANALYZE4. ACT/ADJUST
BUT WHAT DRIVES SUCCESS FOR THE EPM?
ORGANIZATION STRATEGY MAP VISION
INFRASTRUCTURE TARGETS TECHNOLOGY
MISSION BUDGETING PROCESS INCENTIVES PLANNING EXECUTIVE BUY-IN
FORECASTING KPI CONSOLIDATION MODELS
METRICS SCORECARDS INITIATIVES ALERTS
GOALS AGENTS ACTIONS DECISIONS
DASHBOARDS BI ANALYTICS DATA MODEL REPORTS PEOPLE
BUT WHAT DRIVES SUCCESS FOR THE EPM?
ORGANIZATION STRATEGY MAP VISION
INFRASTRUCTURE TARGETS TECHNOLOGY
MISSION BUDGETING PROCESS INCENTIVES PLANNING EXECUTIVE BUY-IN
FORECASTING KPI CONSOLIDATION MODELS
METRICS SCORECARDS INITIATIVES ALERTS
GOALS AGENTS ACTIONS DECISIONS
DASHBOARDS BI ANALYTICS DATA MODEL REPORTS PEOPLE
BUT WHAT DRIVES SUCCESS FOR THE EPM?
ORGANIZATION STRATEGY MAP VISION
INFRASTRUCTURE TARGETS TECHNOLOGY
MISSION BUDGETING PROCESS INCENTIVES PLANNING EXECUTIVE BUY-IN
FORECASTING KPI CONSOLIDATION MODELS
METRICS SCORECARDS INITIATIVES ALERTS
GOALS AGENTS ACTIONS DECISIONS
DASHBOARDS BI ANALYTICS DATA MODEL REPORTS PEOPLE
BUT WHAT DRIVES SUCCESS FOR THE EPM?
ORGANIZATION STRATEGY MAP VISION
INFRASTRUCTURE TARGETS TECHNOLOGY
MISSION BUDGETING PROCESS INCENTIVES PLANNING EXECUTIVE BUY-IN
FORECASTING KPI CONSOLIDATION MODELS
METRICS SCORECARDS INITIATIVES ALERTS
GOALS AGENTS ACTIONS DECISIONS
DASHBOARDS BI ANALYTICS DATA MODEL REPORTS PEOPLE
BUT WHAT DRIVES SUCCESS FOR THE EPM?
ORGANIZATION STRATEGY MAP VISION
INFRASTRUCTURE TARGETS TECHNOLOGY
MISSION BUDGETING PROCESS INCENTIVES PLANNING EXECUTIVE BUY-IN
FORECASTING KPI CONSOLIDATION MODELS
METRICS SCORECARDS INITIATIVES ALERTS
GOALS AGENTS ACTIONS DECISIONS
DASHBOARDS BI ANALYTICS DATA MODEL REPORTS PEOPLE
BUT WHAT DRIVES SUCCESS FOR THE EPM?
ORGANIZATION STRATEGY MAP VISION
INFRASTRUCTURE TARGETS TECHNOLOGY
MISSION BUDGETING PROCESS INCENTIVES PLANNING EXECUTIVE BUY-IN
FORECASTING KPI CONSOLIDATION MODELS
METRICS SCORECARDS INITIATIVES ALERTS
GOALS AGENTS ACTIONS DECISIONS
DASHBOARDS BI ANALYTICS DATA MODEL REPORTS PEOPLE
BUT WHAT DRIVES SUCCESS FOR THE EPM?
ORGANIZATION STRATEGY MAP VISION
INFRASTRUCTURE TARGETS TECHNOLOGY
MISSION BUDGETING PROCESS INCENTIVES PLANNING EXECUTIVE BUY-IN
FORECASTING KPI CONSOLIDATION MODELS
METRICS SCORECARDS INITIATIVES ALERTS
GOALS AGENTS ACTIONS DECISIONS
DASHBOARDS BI ANALYTICS DATA MODEL REPORTS PEOPLE
BUT WHAT DRIVES SUCCESS FOR THE EPM?
ORGANIZATION STRATEGY MAP VISION
INFRASTRUCTURE TARGETS TECHNOLOGY
MISSION BUDGETING PROCESS INCENTIVES PLANNING EXECUTIVE BUY-IN
FORECASTING KPI CONSOLIDATION MODELS
METRICS SCORECARDS INITIATIVES ALERTS
GOALS AGENTS ACTIONS DECISIONS
DASHBOARDS BI ANALYTICS DATA MODEL REPORTS PEOPLE
It’s a bit more complicated than that!
Lets take a car analogy
Analogy EPM
Car Analogy
Analogy EPMDestination Vision
Car Analogy
Analogy EPMDestination VisionMap Strategy Map
Car Analogy
Analogy EPMDestination VisionMap Strategy MapRoutes Planning
Car Analogy
Analogy EPMDestination VisionMap Strategy MapRoutes PlanningRoads Infrastructure
Car Analogy
Analogy EPMDestination VisionMap Strategy MapRoutes PlanningRoads InfrastructureTraffic Rules Compliance
Car Analogy
Analogy EPMSpeed Data Model
Car Analogy
Analogy EPMSpeed Data ModelRear View Mirror Consolidation
Car Analogy
Analogy EPMSpeed Data ModelRear View Mirror ConsolidationGPS Forecasting
Car Analogy
Analogy EPMSpeed Data ModelRear View Mirror ConsolidationGPS ForecastingGears Processes
Car Analogy
Analogy EPMSpeed Data ModelRear View Mirror ConsolidationGPS ForecastingGears ProcessesTransmission Technology
Car Analogy
Analogy EPMSpeed Data ModelRear View Mirror ConsolidationGPS ForecastingGears ProcessesTransmission TechnologyDashboard Scorecards
Car Analogy
Analogy EPM
Car Analogy
Analogy EPMFuel Executive Buy-In
Car Analogy
Analogy EPMFuel Executive Buy-InSteering KPIs
Car Analogy
Analogy EPMFuel Executive Buy-InSteering KPIsMotion Actions
Car Analogy
Analogy EPMFuel Executive Buy-InSteering KPIsMotion ActionsPassengers Shareholders
Car Analogy
Analogy EPMFuel Executive Buy-InSteering KPIsMotion ActionsPassengers ShareholdersMileage Performance
Car Analogy
KPIs represent a set of measures focusing on those aspects of performance that are the most crucial for the continued success of an organization.–David Parmenter, CEO, Waymark Solutions, Author “Key Performance Indicators”
KPI
The only difference between a metric and a KPI is that a KPI embodies a strategic objective and measures performance against a goal.
-TDWI Best Practices Report FQ09: Performance Management Strategies , How to create and deploy effective metrics By Wayne W. Eckerson
KPI
THE CHOSEN ONE
THE CHOSEN ONE
K-P-IKEY PERFORMANCE INDICATOR
“Show me a company that thinks it has key performance indicators (KPIs) measured monthly and quarterly, and I will show you measures that do not create change, alignment and growth and have never been KPIs.”
- David Parmenter, CEO, Waymark Solutions, Author “Key Performance Indicators”
KPI
Measures = Metrics
KPI
Measures = Metrics
All KPIs are metrics but not all metrics are KPIs
KPI
Measures = Metrics
All KPIs are metrics but not all metrics are KPIs
Metrics are the key to analyzing process effectiveness and efficiency
KPI
Measures = Metrics
All KPIs are metrics but not all metrics are KPIs
Metrics are the key to analyzing process effectiveness and efficiency
KPIs affect organizational behavior
KPI
Case Study
Single KPI
Source: “Key Performance Indicators”, David Parmenter** With slight enhancementsBritish Airways
Single KPI
Source: “Key Performance Indicators”, David Parmenter** With slight enhancementsBritish Airways
Single KPI
Source: “Key Performance Indicators”, David Parmenter** With slight enhancementsBritish Airways
Single KPI
Source: “Key Performance Indicators”, David Parmenter** With slight enhancementsBritish Airways
Single KPI
Source: “Key Performance Indicators”, David Parmenter** With slight enhancementsBritish Airways
Single KPI
Source: “Key Performance Indicators”, David Parmenter** With slight enhancementsBritish Airways
Single KPI
Source: “Key Performance Indicators”, David Parmenter** With slight enhancementsBritish Airways
Single KPI
Source: “Key Performance Indicators”, David Parmenter** With slight enhancementsBritish Airways
Single KPI
Source: “Key Performance Indicators”, David Parmenter** With slight enhancementsBritish Airways
Single KPI
Source: “Key Performance Indicators”, David Parmenter** With slight enhancementsBritish Airways
Ready to GO
A single KPI lead Lord King, x-chairman of British Airways to improve overall corporate performance.
This KPI became the single ambition of each employee in her/his respective area of work
Single KPI
Source: “Key Performance Indicators”, David Parmenter** With slight enhancementsBritish Airways
How Many KPIs?
What is the best number of KPIs for an organization?
• Kaplan/Norton – Around 12• Parmenter – Around
10• Eckerson – Around 5-
7 How Many KPIs?
How Many Metrics?
There are no best practices, metrics can go into hundreds and thousands depending on the level of detail captured, interdependencies, the diversity of business domains captured in the systems etc.
Challenge
How does one select around 10 metrics (as KPIs) from a list of hundreds or thousands?
Rule of Thumb guidance
Rule of Thumb guidance
Handpicked based on certain established norms and trends.
Systematic Short listing
Systematic Short listing
KPIs are the output of a systematic process of short listing based on the organizational structure, strategy and planning.
Intuition & Gut Feeling
Intuition & Gut Feeling
Handpicking KPIs based on human intuition and gut feeling
Challenge
Handpicking KPIs usually do not last long!
Challenge
Handpicked KPIs may have bias of human judgment!
Challenge
Handpicked KPIs may not be selected exhaustively!
Challenge
Handpicking KPIs take longer time and cost!
Challenge
Handpicked KPIs may not represent all perspectives of the business
Strong need of a KPI framework which contains both structure and process to cater to this challenge.
Challenge
The KPI framework needs to be interconnected with the overall EPM picture
Challenge
Balanced Scorecard•Most Popular•Improvements - 3rd Generation BSCs
Performance Prism•Vast coverage area•Most Flexible and CustomizableApplied Information Economics•Based on Decision Theory and Actuarial Sciences•High value of worth in IT valuation
Some KPI Frameworks
Performance Prism• Vast coverage area• Most Flexible and Customizable
Strong emphasis on stakeholder success.
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Performance Prism• Vast coverage area• Most Flexible and Customizable
Focuses on Processes and Capabilities, not just strategies and ambitions
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Performance Prism• Vast coverage area• Most Flexible and Customizable
Nevertheless, focuses on long term success
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Performance Prism• Vast coverage area• Most Flexible and Customizable
Measures based management is not explicit but can be made to be so.
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Performance Prism• Vast coverage area• Most Flexible and Customizable
Process based improvement is the key!
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Performance Prism• Vast coverage area• Most Flexible and Customizable
Flexible in structure but development process is less incremental and less iterative
compared to alternate approaches
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Performance Prism• Vast coverage area• Most Flexible and Customizable
Development cycles might take longer times than alternatives due to vast coverage area.
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Applied Information Economics• Based on Decision Theory and Actuarial Sciences• High value of worth in IT valuation
Mostly used for Enterprise Architecture ROI
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Applied Information Economics• Based on Decision Theory and Actuarial Sciences• High value of worth in IT valuation
Rarely used as the sole framework for KPIs.
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Applied Information Economics• Based on Decision Theory and Actuarial Sciences• High value of worth in IT valuation
Works well for justifying quantification of qualitative metrics
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Applied Information Economics• Based on Decision Theory and Actuarial Sciences• High value of worth in IT valuation
Falls short of becoming a comprehensive EPM framework
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Balanced Scorecard• Most Popular• Improvements - 3rd Generation BSCs
A guideline, not a roadmap
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Balanced Scorecard• Most Popular• Improvements - 3rd Generation BSCs
A framework with flexible process approaches
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Balanced Scorecard• Most Popular• Improvements - 3rd Generation BSCs
Highly collaborative
*This assessment is based on comments available on the public domain & not on any scientifically established premise.*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Balanced Scorecard• Most Popular• Improvements - 3rd Generation BSCs
Highly visible and transparent
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Balanced Scorecard• Most Popular• Improvements - 3rd Generation BSCs
Most popular framework
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Balanced Scorecard• Most Popular• Improvements - 3rd Generation BSCs
Framework is scalable (currently 3rd Generation Balanced Scorecarding
standard is available.)
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Balanced Scorecard• Most Popular• Improvements - 3rd Generation BSCs
Framework is customizable (many case studies with significant changes on the
underlying structure and approach.)
*This assessment is based on comments available on the public domain & not on any scientifically established premise.
Balanced Scorecard• Most Popular• Improvements - 3rd Generation BSCs
Structure
• Perspectives• Strategy Maps
Approach
• Iterative• JAD
Balanced ScorecardStructure
Balanced ScorecardStructure
An organization of performance artifacts (metrics, KPIs, Goals, Objectives & Strategy)
Balanced ScorecardStructure
Structure develops context for each performance artifact
Balanced ScorecardStructure
The context determines the purpose and usage for each performance artifact.
Balanced ScorecardStructure
It also allows for clearer communication
Balanced ScorecardStructure
The contexts are developed through 'Perspectives'
Balanced ScorecardStructure
'Perspectives' can be any and many
Balanced ScorecardStructure
The original Balanced Scorecard approach had four…
Balanced ScorecardStructure
Financial PerspectiveCustomer PerspectiveBusiness ProcessesInternal Learning and Growth
Balanced ScorecardStructure
The recent 3rd Generation BSC has two more...
Balanced ScorecardStructure
Employee PerspectiveShareholder Perspective
Balanced ScorecardStructure
Companies can choose to develop their own perspectives
Balanced ScorecardStructure
However, the essence of having a balance between financial and nonfinancial perspective has to be maintained
Balanced ScorecardStructure
Balancing means that all perspectives are taken under consideration when determining performance
Balanced ScorecardStructure
It also means that all performance artifacts chosen are mutually consistent
Balanced ScorecardStructure
...meaning one performance artifact does not conflict or negate any other chosen artifact.
Balanced ScorecardStructure
Perspectives are chained through cause and effect relationships
Balanced ScorecardStructure
Perspectives also allow for determining KPIs from metrics
Balanced ScorecardStructure
Perspectives are used as a tool for strategy communication using strategy maps
Balanced ScorecardStructure
The Strategy Map is the cornerstone of strategy communication
Balanced ScorecardStructure
It groups and links the organizational goals & objectives into perspectives and determine a cause effect relationship
Balanced ScorecardStructure
This allows all stakeholders to identify the fundamental line of action for combined success
Balanced ScorecardStructure
A strategy map helps people at all levels in the organization to relate performance with their domain of responsibility
Balanced ScorecardStructure
Strategy maps enable a unidirectional approach towards better performance.
Sample Strategy Map
• OK…• There is the Strategy Map…
• OK…• There is the Strategy Map…• The KPIs…
• OK…• There is the Strategy Map...• The KPIs…• The KPIs Framework…
• OK…• There is the Strategy Map …• The KPIs…• The KPIs Framework…• The People…
• OK…• There is the Strategy Map…• The KPIs…• The KPIs Framework…• The People…• The Processes…
• OK…• There is the Strategy Map…• The KPIs…• The KPIs Framework…• The People…• The Processes…• The Technology…
• OK…• There is the Strategy Map…• The KPIs…• The KPIs Framework…• The People…• The Processes…• The Technology…• The Governance…
• OK…• There is the Strategy Map…• The KPIs…• The KPIs Framework…• The People…• The Processes…• The Technology…• The Governance…• The Business…
• OK…• There is the Strategy Map…• The KPIs…• The KPIs Framework…• The People…• The Processes…• The Technology…• The Governance…• The Business…
Where Do I Start?
• The approach to establish an EPM framework is subjective and depends on…
• The Company
• The Company• The KPI Team
• The Company• The KPI Team• Market Conditions
• The Company• The KPI Team• Market Conditions• Existing Maturity of EPM Know-How
And…
ORGANIZATION STRATEGY MAP VISION
INFRASTRUCTURE TARGETS TECHNOLOGY
MISSION BUDGETING PROCESS INCENTIVES PLANNING EXECUTIVE BUY-IN
FORECASTING KPI CONSOLIDATION MODELS
METRICS SCORECARDS INITIATIVES ALERTS
GOALS AGENTS ACTIONS DECISIONS
DASHBOARDS BI ANALYTICS DATA MODEL REPORTS PEOPLE
ORGANIZATION STRATEGY MAP VISION
INFRASTRUCTURE TARGETS TECHNOLOGY
MISSION BUDGETING PROCESS INCENTIVES PLANNING EXECUTIVE BUY-IN
FORECASTING KPI CONSOLIDATION MODELS
METRICS SCORECARDS INITIATIVES ALERTS
GOALS AGENTS ACTIONS DECISIONS
DASHBOARDS BI ANALYTICS DATA MODEL REPORTS PEOPLE
A cloud of other aspects!
Myriad of Approaches
Myriad of ApproachesChoose which meets your EPM’s purpose
ApproachBalanced Scorecard
ApproachBalanced Scorecard
No matter what approach U take, follow these guidelines…
ApproachBalanced Scorecard
KPI Survey
Data Survey
Process Survey
Parallel Activities
ApproachBalanced Scorecard
KPI Survey
Data Survey
Process Survey
Parallel Activities
Each Powers the Other
ApproachBalanced Scorecard
KPI Survey
Data Survey
Process Survey
Parallel Activities
Each Powers the Other
Frequent Iterations
ApproachBalanced Scorecard
KPI Survey
Data Survey
Process Survey
Parallel Activities
Each Powers the Other
Frequent Iterations
To and Fro
ApproachBalanced Scorecard
KPI Survey
Data Survey
Process Survey
Parallel Activities
Each Powers the Other
Frequent Iterations
To and Fro
Till Convergence…
ApproachBalanced Scorecard
KPI Survey
Data Survey
Process Survey
Parallel Activities
Each Powers the Other
Frequent Iterations
To and Fro
Till Convergence…
i.e. Agreement & Feasibility
ApproachBalanced Scorecard
1st Iteration 2nd Iteration3rd Iteration
KPI Development
ApproachBalanced Scorecard
1st Iteration 2nd Iteration3rd Iteration
KPI Survey must be scoped into iterations
KPI Development
ApproachBalanced Scorecard
1st Iteration 2nd Iteration3rd Iteration
KPI Survey must be scoped into iterations
KPIs must be worked in batches
KPI Development
ApproachBalanced Scorecard
1st Iteration 2nd Iteration3rd Iteration
KPI Survey must be scoped into iterations
KPIs must be worked in batches
Starting with the most critical…and visible
KPI Development
ApproachBalanced Scorecard
1st Iteration 2nd Iteration3rd Iteration
KPI Survey must be scoped into iterations
KPIs must be worked in batches
Starting with the most critical…and visible
Iterations...KPIs from focused to comprehensive
ApproachBalanced Scorecard
Program Launch
Presentation
ApproachBalanced Scorecard
Program Laun
ch Presentation
…Set the tone, direction and
agenda
ApproachBalanced Scorecard
Focus Group
Meeting
Iteration
ApproachBalanced Scorecard
Focus
Group
Meeting
…KPI team meet up to re-assess,
re-align & initiate actions
Iteration
ApproachBalanced Scorecard
Focus Group
Meeting
Workshop: Strategy
Maps
Iteration
ApproachBalanced Scorecard
Workshop: KPI Library
Focus Group
Meeting
Workshop: Strategy
Maps
Iteration
ApproachBalanced Scorecard
Workshop: KPI Library
Workshop: Dashboard
Design
Focus Group
Meeting
Workshop: Strategy
Maps
Iteration
ApproachBalanced Scorecard
Workshop: KPI Library
Workshop: Dashboard
Design
Demo Runs
Focus Group
Meeting
Workshop: Strategy
Maps
Iteration
ApproachBalanced Scorecard
Finalization…time to
implement & launch
Iteration
ApproachBalanced Scorecard
No matter how much you think you have finalized the KPI framework….
ApproachBalanced Scorecard
No matter how much you think you have finalized the KPI framework….
Be ready for changes and further iterations
ApproachBalanced Scorecard
No matter how much you think you have finalized the KPI framework….
Be ready for changes and further iterations
Be Agile!
References and Credits• Photo Credits:
• adactio• AmyLovesYah• arjun01• brian_hillegas• drcorneilus• easyflow• exfordy• faisal198846• lepiaf• Malias• rhett maxwell
• References:
• The Balanced Scorecard: Translating Strategy into Action by Robert S. Kaplan and David P. Norton (Hardcover - Sep 1, 1996)
• Performance Dashboards: Measuring, Monitoring, and Managing Your Business by Wayne W. Eckerson (Hardcover - Oct 14, 2005)
• Key Performance Indicators: Developing, Implementing,and Using Winning KPIs by David Parmenter (Hardcover - Jan 16, 2007)
• Performance Dashboards and Analysis for Value Creation (Wiley Finance) by Jack Alexander (Hardcover - Nov 3, 2006)
• Balanced Scorecard Step-by-Step: Maximizing Performance and Maintaining Results - Hardcover (Sep 1, 2006) by Paul R. Niven
• The Performance Prism: The Scorecard for Measuring and Managing Business Success by Andrew Neely, Chris Adams, and Mike Kennerley (Hardcover - Jun 27, 2002)
• How to Measure Anything: Finding the Value of "Intangibles" in Business by Douglas W. Hubbard (Hardcover - Aug 3, 2007)
• TDWI Best Practices Report: How to create and deploy effective metrics, Wayne Eckerson, Q1, 2009
Contact
Atif Abdul-Rahman, atif.abdulrahman <at> gee mail
www.linkedin.com/in/atifabdulrahman
www.knowledgeworks.wordpress.com