Performance Pyramid

Cross and Lynch 1991 viewed businesses as performance pyramids

• Objectives are top down and measurements are top up
• Quality and delivery should equal Customer satisfaction but watch that Reducing costs do not lead to a fall in staisfaction
• The left side are external influences and the right is internal
• It starts at the individual level all the way to corporate level
• Provides a more integrated approach than Fitzgerald and Moon
• Focuses on the right priorities

Also look at http://www.accaglobal.com/publications/studentaccountant/43909

Performance measurements Benefits and Problems

• Develops agreed Measures
• Clarifies the Objectives of the Org
• Greater understanding of Process
• Helps faciitate comparison between divisions
• Promotes Accountability to stakeholder
• Helps sets Targets for managers

Problems

• Tunnel Vision - Undue focus on measurements to the detriment of other areas (e.g Doctors must see a patient in 48 hours)
• Sub-optimizatoin - focus on one measurement to the dertiment of others
• Myopia. Focusing too much on short-term measures and not looking looking long-term
• Measurement fixation- meeting student quotas but leading to higher drop out rates
• Misrepresentation - Not presenting the data correctly
• Mis-intrepreting the data -
• Ossification - keeping of out of date measures

Stakeholders

Who are they?, how many?, what to they want?, do they want the same things?, what is the time frame?

See also

• http://www.som.cranfield.ac.uk/som/dinamic-content/research/cbp/IJOPM2010.pdf