Performance Measurement

Managers continue to face increased pressure to improve performance and produce results. Managers face increased fiscal pressure to:

• Increase transparency
• Increase efficiency
• Increase productivity
• Increase effectiveness
• Balance budgets
• Contain or reduce costs
• Reduce risk

With a shift in focus from activity-based performance measurement to outcome-based performance management, managers are challenged to define what performance means.

• Organizations must translate desired improvements into measurable outcomes based on mission and customer requirements
  • Key performance metrics should be defined at each organizational level using a top-down strategic focus and a bottom-up flow of information
  • Each employee should understand how their role impacts the success of the organization
• Once performance has been defined, the organization should build the required infrastructure –- the capabilities, processes, and systems — to measure, assess, and manage performance over time

Performance Measurement Client Example:


Organizational Goal: To be the provider of choice

Organizational Level		Goal at Level	Metric / Measure / Data at Level
	Strategic	Understand customer needs	% of customer budget
	Operational	Build customer relationships	% of customers with completed profiles % of customers with standing meetings
	Tactical	Conduct customer site visits	Number of customer site visits Number of service tickets initiated from customer visits Ratio of customer site visits to log entries

Our Approach to Performance Measurement

Lattice Performance Works assists clients to define performance at all levels in the organization.

In the example provided, the Client’s goal was to become the provider of choice for their service offering. A customer market survey indicated that to achieve their goal, the Client needed to better understand their client’s needs. Performance was defined at each level in the organization.

• At the Strategic Level, this might be reflected by an outcome measure, such as % of customer budget (reflecting market share)
  
• At the Operational Level, this might be measured by the strength of the relationship as evidenced by % of customers with standing meetings (relationship strength) and completed customer profiles (information about the client shared with others for better customer service)
  
• At the Tactical level, activities that support strengthening customer relationships would be measured, such as the number of customer site visits (client interaction), service tickets initiated from customer visits (proactively assisting the client), and ratio of customer site visits to log entries (collecting information about the client to share within)

As illustrated in the client example, the alignment of metrics and measures is more than just data consolidation. Performance must be defined at all levels in the organization.