Transforming Performance Measurement: Rethinking the Way We Measure and Drive Organizational SuccessIt's no secret that you can't improve your organization's performance without measuring it. In fact, every function, unit, process, and the organization as a whole, is built and run according to the parameters and expectations of its measurement system. So you'd better make sure you're doing it right. All too often, performance measurement creates dysfunction, whether among individuals, teams, or across entire divisions and companies. Most traditional measurement systems actually encourage unhealthy competition for personal gain, creating internal conflict and breeding distrust of performance measurement. Transforming Performance Measurement presents a breakthrough approach that will not only significantly reduce those dysfunctions, but also promote alignment with business strategy, maximize cross-enterprise integration, and help everyone to work collaboratively to drive value throughout your organization. Performance improvement thought leader Dean Spitzer explains why performance measurement should be less about calculations and analysis and more about the crucial social factors that determine how well the measurements get used. His ""socialization of measurement"" process focuses on learning and improvement from measurement, and on the importance of asking such questions as: How well do our measures reflect our business model? How successfully are they driving our strategy? What should we be measuring and not measuring? Are the right people having the right measurement discussions? Performance measurement is a dynamic process that calls for an awareness of the balance necessary between seemingly disparate ideas: the technical and the social aspects of performance measurement. For example, you need technology to manage the flood of data, but you must make sure that it supports the people who will be making decisions and taking action crucial to your organization's success. This book shows you how to design that technical-social balance into your measurement system. While it is urgent to start taking action now, transforming your organization's performance measurement system will take time. Transforming Performance Measurement gives you assessment tools to gauge where you are now and a roadmap for moving, with little or no disruption, to a more "transformational" and mature measurement system. The book also provides 34 TMAPs, Transformational Measurement Action Plans, which suggest both well-accepted and "emergent" measures (in areas such as marketing, human resources, customer service, knowledge management, productivity, information technology, research and development, costing, and more) that you can use right away. In the end, you get what you measure. If you measure the wrong things, you will take your company farther and farther away from its mission and strategic goals. Transforming Performance Measurement tells you not only what to measure, but how to do it -- and in what context -- to make a truly transformational difference in your enterprise. |
Contents
Why Measurement Is So Powerful | 9 |
The Pervasiveness of Measurement | 10 |
The Challenge of Organizational Measurement | 11 |
The Power of Measurement | 12 |
Performance Measurement Promotes Effective Management | 13 |
The Functions of Performance Measurement | 15 |
When Measurement Goes Bad | 21 |
The Problem of Measurement Dysfunction | 22 |
Routine vs Transformational Measurement | 126 |
The Challenges of Changing Measurement | 127 |
Leading Transformational Performance Measurement | 128 |
Making the Transformation Happen | 132 |
Measurement Leaders | 134 |
The Role of Chief Measurement Officer CMO | 139 |
Learning About and from Measurement | 140 |
The Learning Loop | 142 |
A Major Cause of Measurement Dysfunction | 23 |
Fear Also Induces Measurement Dysfunction | 26 |
Measuring the Wrong Things | 29 |
Measuring Looking Good Rather Than Being Good | 30 |
Suboptimization | 31 |
Cheating | 33 |
Measuring Too Much | 34 |
Dysfunctional Measurement and Employees | 35 |
Why Measurement Goes Bad | 36 |
How People Experience Measurement | 38 |
Employees Attitudes Toward Measurement at Work | 39 |
The Context of Measurement | 40 |
Confusing Measurement and Evaluation | 41 |
Purpose | 42 |
Disempowerment | 43 |
The Motivational Use of Measurement | 44 |
Distrust | 45 |
Resistance to Measurement | 46 |
The Challenge Ahead | 47 |
Beginning the Transformation | 48 |
The Four Keys | 51 |
A Roadmap to Success | 55 |
Creating a Positive Context of Measurement | 56 |
The Formal Aspects of the Performance Measurement System | 59 |
The Human Factor | 60 |
The Context of Measurement Continuum | 61 |
A SureFire Indicator of Positive Context of Measurement Change | 62 |
Snapshots from the New Performance Measurement Paradigm | 63 |
The Ongoing Transforming Power of Context | 67 |
The Focus of Measurement | 68 |
Selecting the Right Measures | 69 |
Effectiveness First | 71 |
How Value Is Created and Destroyed | 72 |
Business Models and Strategy | 74 |
Measuring What Matters Most | 76 |
Measuring Intangible Assets | 78 |
HighLeverage Measuring | 79 |
Emergent Measures | 81 |
New Customer Measures | 82 |
Dont Expect Perfection | 84 |
The Next Step | 85 |
The Integration of Measurement | 86 |
The DisIntegrated Organization | 87 |
DisIntegrated Measurement | 89 |
DisIntegrated Data | 90 |
The Balanced Scorecard | 91 |
The Value of Measurement Frameworks | 93 |
Measurement Frameworks and TradeOffs | 96 |
Developing Measurement Frameworks | 97 |
The Need for a CMO | 102 |
The Interactivity of Measurement | 103 |
The Importance of Interactivity | 104 |
Data Information Knowledge and Wisdom | 105 |
The DatatoWisdom Conversion Process | 108 |
Examples of Interactivity to Generate Wisdom | 109 |
The Performance Measurement Cycle | 110 |
The Key to Measurement Interactivity | 115 |
Assessing an Organizations Measurement Capabilities | 116 |
The Challenge of Interactivity Today | 118 |
The Tendency to View Technology as the Panacea | 119 |
Making Progress | 120 |
Measurement Leadership | 121 |
Why Measurement Leadership Doesnt Happen | 122 |
What Happens in the Absence of Measurement Leadership? | 123 |
Transformational Measurement and DoubleLoop Learning | 144 |
Organizational Learning | 145 |
Why Smart People Do Dumb Things | 147 |
How Performance Measurement Can Help | 148 |
Learning New Ways of Thinking About Performance Measurement | 149 |
The Keys to Transformational Learning | 150 |
How Well Does Your Organization Learn About and from Measurement? | 159 |
The Uses and Abuses of Measurement Technology | 160 |
Technology Infatuation | 161 |
The Human Factor | 162 |
The Proper Role of Technology in Performance Measurement | 163 |
Business and Social Architecture | 164 |
Failure to Address the Social Issues | 166 |
Scorecards and Dashboards | 168 |
Adopting and Implementing Measurement Technology | 171 |
Steps for Successful Technology Investment | 174 |
Performance Measurement Maturity | 177 |
Assessing Transformational Performance Measurement Maturity | 180 |
Levels of Performance Measurement Maturity | 188 |
The Transformational Measurement Maturity Assessment | 191 |
Transformational Measures | 196 |
From Exploration to Transformation | 197 |
Taking the Lead in Transformational Measurement | 199 |
The Transformational Lens | 201 |
Transformational Measurement of Intangibles | 204 |
Introducing the Transformational Measurement Action Plans | 211 |
Dont Get Discouraged | 213 |
Transformational Measurement Action Plans | 214 |
2 Customer Engagement | 215 |
3 Customer Delight | 216 |
4 Customer Loyalty | 217 |
5 Customer Relationship | 218 |
6 Voice of the Customer | 219 |
7 Customer Profitability | 221 |
8 Customer Lifetime Value | 222 |
10 Brand Equity | 223 |
11 Intellectual Capital | 225 |
12 Strategic Readiness of Intangibles | 226 |
13 Innovation Climate | 227 |
14 Reputation | 228 |
15 Organizational Trust | 229 |
16 Partner Relationships | 232 |
17 Collaboration | 233 |
18 Productivity | 234 |
19 Organizational Agility | 235 |
20 Waste | 237 |
21 Inventory | 238 |
22 Total Cost of Ownership | 240 |
24 Economic Value Added | 242 |
25 Organizational Intangible Value | 243 |
26 Project Scheduling | 244 |
27 Employee Engagement | 245 |
28 Emotional Intelligence | 247 |
29 Employee Safety | 249 |
30 Employee Presenteeism | 250 |
31 Learning Effectiveness | 251 |
32 Information Orientation | 252 |
33 Information Proficiency | 253 |
34 Knowledge Flow | 255 |
How to Begin Transforming Performance Measurement in Your Organization | 257 |
Notes | 262 |
271 | |
277 | |
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Transforming Performance Measurement: Rethinking the Way We Measure and ... Dean Spitzer Limited preview - 2007 |
Common terms and phrases
Activity-Based Costing aspects Balanced Scorecard behavior business model Business Performance Management Business School Press challenge Chapter collaboration context of measurement costs create cross-functional Customer Lifetime Value Customer Profitability customer satisfaction dashboards decisions developed dialogue double-loop learning drive Edwards Deming effective Eliyahu Goldratt emergent measures Emotional Intelligence employees example executives experience focus focused formance measurement functional happen Harvard Business School important improvement increase innovation insight intangible assets integration interactivity inventory knowledge Larry Bossidy measurement dysfunction measurement frameworks measurement leadership measurement system ment metrics negative organization organization's organizational organizational learning percent performance mea performance measurement maturity perspective Peter Senge positive context potential problem realize relationships rewards score Six Sigma social stakeholders strategy success surement technical tend things tion tional trade-offs traditional transformational measurement transformational performance measurement trust understanding value creation wisdom