11.6 Business (Corporate) Performance Management, Scorecards, and Dashboards

David Edwards Charles Travis
11.6 Business (Corporate) Performance Management, Scorecards, and Dashboards
*All related information taken directly from Information Technology for Management, 6th Edition, by Efraim Turban, Dorothy Leidener, Ephraim McLean, and James Wetherbe; Chapter 11, section 11.6, pages 457-463.
**Related contextual links are included

Business Performance Management (BPM) Defined:
· Corporate performance management: an umbrella term covering the processes, methodologies, metrics and technologies for enterprises to measure, monitor, and manage business performance management (BPM)
· Interchangeable terms:
o Business Performance Management (BPM)
o Corporate Performance Management (CPM)
o Enterprise Performance Management (EPM)
o Strategic Enterprise Management (SEM)

The Relationship of BPM and BI:
· Part of the BI process
· Adds to the integration of the processes, methodologies, metrics, and systems

The BPM Process:
· Major steps:
1. Design a BPM program and define what measuring
2. Establish standards against performance (e.g./balanced scorecard)
3. Prepare a system for monitoring performance, including finding the performance gaps
4. Prepare a system for analyzing performance
5. Take action if needed

Balanced Scorecard:
*Balanced Scorecard (BSC): most widely known performance management system
· The Meaning of Balance: measures performance based on financial and non financial objectives
o Nonfinancial objectives:
1. Customer
2. Internal business process
3. Learning and growth

· Aligning Strategies and Actions
Steps to align methodology with overall strategies
1. Indentifying strategic objectives for each perspective
2. Associating measures with each strategic objective (mix of quantitative and qualitative)
3. Assigning targets to the measures
4. Listing strategic initiatives to accomplish each objective (assigning responsibilities)
5. Linking the various strategic objectives through a cause-and-effect diagram called a strategy map
Strategy map: shows the relationships among the key organizational objectives for all four BSC perspectives.

Performance Dashboards:
· Scorecards and dashboards both provide visual displays of important information that is consolidated and arranged on a single screen so that information can be digested at a single glance and easily explored.
· Key Performance Indicators (KPIs)
· Pipeline data

Dashboards versus Scorecards:
· Performance dashboards are visual displays used to monitor operational performance
· Performance scorecards are visual displays used to chart progress against strategic and tactical goals and targets
o Three types of performance dashboards
1. Operational dashboards: used by front-line workers and supervisors
2. Tactical dashboards: used by managers and analysts to track on daily or weekly basis from different departments
3. Strategic dashboards: used by executives, managers and staff to monitor on a monthly or quarterly basis, detailed and summarized to the strategic objectives

Business Activity Monitoring:
· Reflects zero-latency enterprise and straight-through processing
· Latency: refers to the gap between when data are collected and when they are available for decision making
· Zero-latency organization: one in which data are immediately available, enabling an enterprise to be proactive rather than reactive
· Straight-through processing refers to processing in which inefficient steps (like manual entry) have been eliminated
· Business Activity Monitoring (BAM) systems consist of real-time systems that alert managers to potential opportunities, impending problems, and threats, and then empower them to react through models and collaboration.

BAM Benefits:
· Real-time data access in a usable format
· Access to tools to collaborate and model the problem leading to a quick solution
o Faster and better decisions will be made
RELATED LINKS:

http://www.compositesw.com/assets/demos/soa/cmp_DataServ_preso.html