Business Performance Program
A Business Performance Program helps you
hit your targets by The Business Performance Program outlined on this page is a powerful, proven management tool. The heart of the program focuses on tracking and reporting operational performance. The program is known by various names in the companies where I have advised on the program's implementation. Some of these program names include:
By these and a few other names, the Business Performance Program
This Business Performance Program works well when it is implemented by the operational head of a corporation or of a major division/profit center. Therefore, this outline speaks directly to the Chief Operating Officer. This article also assumes that your organization has an annual and strategic goals program in place. Hopefully, you publish the goals for use by all personnel in an annual business plan or similar document. CommitmentTo be successful, the Business Performance Program requires commitment on the part of the top three levels of management (you, your directs, and their directs). When you are committed to the program and use it in your daily activities, they will quickly adopt the program. Use the program's graphics in your meetings with directs,
with your board of directors, with regulators, and in all-hands meetings. Make achieving the levels of performance targeted in the Business Performance Program a part of the basis for incentive compensation. A couple of gentle hints that you expect everyone in the organization to be aware of current performance and committed to achieving, and then exceeding established targets will help. You could use the method one Division President used... After his program had been in place for about two months, he went out near the cafeteria on the day prior to the meeting at which he and his directs would review the next performance report. There he struck up a conversation with a couple of maintenance workers. He asked them what they thought of the new performance report. Predictably, they had never heard of the program. He then invited the curious maintenance workers to his office and went through the report with them. Later that day the president's assistant had occasion to talk with several department heads, and mentioned the incident to them. The story was soon all over the division. At the meeting the next day, a VP asked the president about the incident. In a low-key manner, the president told the group that he would be "very disappointed" if he received a similar response the next time he asked a front-line employee about the program. That Business Performance Program was quickly the yardstick of success throughout the organization. Program ComponentsThe primary components of this performance tracking program are:
Progress toward achieving each annual goal is tracked by one or more performance indicator. In addition, several indicators and targets are identified to track performance in other important areas.
This should result in each department head having responsibility for a couple of indicators Assign ownership of the various indicators to these department heads. Each performance area will (hopefully) be impacted by the actions of other departments. For instance, the Training Manager may have a goal related to "Scheduled Training Participation." This manager needs other departments to schedule and then actually send the people for training. Your department heads quickly see that they get cooperation in achieving their targets by supporting others in achieving their own targets. Another area of responsibility for department heads is data reporting. Establish a firm schedule for data reporting. Program MechanicsMost of the players have been mentioned above, but I need to clarify that...
Who will be responsible for daily operation of your performance trending program? Most organizations use an admin support group that is also responsible for:
This group will build the individual indicators using spreadsheet software and work with the indicator owners and officers to define and build each indicator. They will then incorporate the indicators into a report format, with a summary page similar to the one below.
The admin group is also responsible for developing an annual schedule detailing the dates and times that data is due, plus subsequent review and publication dates. (Publication should be within ten days of the month end. Stale information is seen as less important.) Once the Business Performance Program is set up, the following sequence occurs each month: The admin group receives monthly data from each owner's data source, updates the indicator, and provides a draft of the updated indicator to the owner and data source. The indicator owner reviews the update and responds to the admin group with any corrections, and assigns a tentative color code to be used on the summary page. The admin group prepares a draft report of all indicators for management review. The admin group's next task is hosting the monthly meeting, where all officers and indicator owners review the draft report, make corrections, assign final color codes, and approve publication of the report. Publication and distribution of each month's report to all sections is then completed. Usually, officers and department heads receive an electronic copy and a bound hard copy. Electronic distribution is then made to all supervisors/section heads for use in staff meetings. IndicatorsThe actual indicators will vary according to the business and its needs. Some will need to place emphasis on finances and sales, others will emphasize finances and production. Each indicator should consist of a data table and chart. Charts provide pictures of actual performance vs. targets and communicate quickly and effectively. Data tables drive the charts and keep your "numbers people" happy. Here's an example of a data table and its chart.
Basic indicators should include:
And there you have the outline of a Business Performance Program that works. Modify it to fit your organization and industry. This business performance program link offers additional resources. A web search using the keyword phrase set up a business performance program will lead you to more resources. Be sure to notice the relevant ads down the right side... those are resources also.
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