performance measurement

Question 1

whats an issue with financial performance measure about their focus

Answer 1

can be v focused on success outcomes rather than the inputs and processes required to ensure success

Question 2

what can NFPMs do

Answer 2

give a more informed insight into an organisations success or lack of it

Question 3

what may NFPMS be a measurement of in terms of performance

Answer 3

quality of production
speed or efficiency
delivery
reliability
customer satisfaction
innovation

Question 4

what is a balance scorecard

Answer 4

strategic performance management tool that provides a comprehensive view of an organisation’s performance

integrates financial and non financial performance measures to help organisations translate their strategy into actionable objectives

Question 5

how does the balance scorecard help the organisation

Answer 5

helps them align their activities with their strategic objectives, monitor progress, and make data - driven decisions. by providing a balance view of performance across multiple dimensions, it ensures that organisations do not focus solely on financial outcomes but also consider other critical factors that contribute to overall success

Question 6

what are the contents of the BSC

Answer 6

• four perspectives
• within each perspective a small number of key goals are identified based on the organisations strategic aims and its critical success factors (CSFs)
• goals are translated into performance measure so that the organisation can measure they performance or progress in meeting the key goals identified
• finally each goal has at least one action or initiative that the organisation can adopt to make it more likely goals are met

Question 7

what are the 4 perspectives

Answer 7

1. financial
2. customer
3. internal business processes perspective
4. learning and growth

Question 8

what are leading performance measure

Answer 8

one that can be insightful into future performance

generally influenced or controlled to improve future results
- number of new customers
- employee training hours

Question 9

what are lagging performance measures

Answer 9

indicators that reflect past performance and outcomes that have already occurred

return on capital employed depends entirely on past actions and performance

Question 10

what do we often consider the leading and the lagging

Answer 10

leading = non financial perspectives
lagging = finnica perspectives

Question 11

advantages of the balance score card

Answer 11

• comprehensive and balanced view
• strategic alignment
• can be used to easily communicate up and down the hierarchy
• data driven so objective and specific
• continuously reviewed to encourage continuous improvement

Question 12

risk or problems with BSC

Answer 12

• must be regulated updated to stay relevant - lots of time
• has to be adapted at different management levels of the org
• easy to break the alignment with strategic decisions
• easy to overload with KPIs

Question 13

what are some alternative models/approaches

Answer 13

Lynch and cross pyramid
- has different levels and split up on each level to show different missions
- drawback is that it does tend to concentrate on two groups of stakeholders

relative performance measurement
- RPM evaluates a performance by comparing it against the performance of its peers or benchmarks within the same industry