Many specialists mention the importance of performance management by KPIs and their use in companies.
But, actually , do all of them master the notion of business performance management, the concept of KPIs or maybe all the opposite notions involved within the application of the business management methodology?
It is clear that without the mastery of the concepts, the implementation are going to be subject to uncertainties and therefore the management of the company performance obtained won’t be up to the expected results.
Therefore, during this article, additionally to taking you step by step through the way to manage your business performance, we’ll clearly define the most concepts involved in these steps for you.
Ready to demystify business performance management? Let’s go!
See also: The 7 essential features of workflow automation software
What Is Business Performance Management?
This notion isn’t difficult to understand , see for yourself:
Business performance management may be a business management methodology supported the definition of performance indicators for the processes administered within the company and, in some cases, for the workers working for the corporate . because of these performance indicators or KPIs (acronym for English expression Key Performance Indicators ), it’s possible to assess the people and processes of a corporation . it’s then necessary to market the planning and improvement of processes in order that the corporate obtains better results and achieves the organizational objectives defined in its strategic planning.
Now that you simply know what performance management is, let’s come to the concept of performance indicators.
What Are The Performance Indicators?
Performance indicators are determined parameters that has got to be measured in each of a company’s processes so as to assess whether the execution of those processes is adequate, efficient or maybe effective and whether the results obtained are satisfactory.
For example, call centers often use a performance indicator (or KPI) to live the speed of response to a call .
The NPS, and Net Promoter Score is another performance indicator commonly utilized in marketing.
It allows, during a simple and agile way, to assess the satisfaction and loyalty of its customers.
This indicator takes the shape of one question such as:
“On a scale of 0 to 10, would you recommend our company (brand, service, etc.) to a lover or family member”?
Widely employed by many companies, the measure obtained by this KPI can easily be compared with the performance of your competitors within the region where your company operates.
Find out more about the NPS indicator during this blog post: The 3-Step Customer Feedback Survey Form
7 steps to implement performance management
Now that you simply have mastered the concept of business performance management, let’s take a step-by-step approach to implementing it.
1 – Analyze the strategic objectives of the corporate
The analysis of the corporate ‘s strategic objectives should be administered upstream of any initiative or project that the company wishes to implement.
After all, implementing a project that might not help achieve business goals would be a waste of resources.
This is all the more critical when managing business performance, because the ultimate goal of improving performance is to facilitate the achievement of business goals and objectives.
Therefore, of these initiatives must be aligned with the strategic planning of the corporate and its objectives.
2 – Choose the processes that add the foremost value to the business
Managing the performance of a business isn’t an easy activity .
It is even a posh process requiring good planning, resources and time.
Therefore, at the beginning of the implementation of enterprise performance management, one shouldn’t immediately want to encompass all the processes of the enterprise.
This is not only impossible, it’s also highly unproductive and risky.
The ideal is to settle on some key business processes with which to start out the analysis.
After improving performance management and ensuring your results are being achieved, choose a couple of additional processes to include into your business performance management program.
Over time, all important business processes will have their performance evaluated.
But, how does one define which processes should be included in performance management?
Criteria for selecting the processes subject to performance management:
Processes that add a perception useful to the top customer, such as, for instance , the way food is ready during a gourmet restaurant is prime to the taste of the dishes.
High risk processes . Take, for instance , credit analysis during a bank.
Processes during which there’s direct contact with the top customer . for instance , the reception of passengers when boarding a plane.
Processes constituting a serious competitive advantage for the business like maintaining a high connection speed during a video streaming company like Netflix.
3 – Analyze these processes
Now that you simply have defined some important processes, you would like to research how they add order to completely understand them.
After all, the way to manage the performance of a process if you are doing not fully understand how it’s executed, what are the various stages, the actors, the departments involved, the required documents, etc.
The ideal is therefore to draw a diagram of this process . A graphical representation of the task flow representing any deviations, deciding , and other events occurring during the method .
Three techniques will assist you gather the knowledge needed to know and style the method diagram: interviews with process participants, observation of the flow of the present process, and collection of documents utilized in the method .