#38 Do You Really Need A Corporate Performance Office?

They're popping up like mushrooms after ground-soaking rains: the Corporate Performance Office, a small team of people devoted to developing, coordinating, and facilitating their organisation's performance measurement and management system, from top to bottom, left to right, and back to front. But do YOU really need one too?

Let's take a look as some of the most compelling "pros" to have a Corporate Performance Office, and trade them off against some of the more deterring "cons" not to.

PRO: Credibility. A CEO endorsed venture like a Corporate Performance Office puts meaningful performance measurement on everyone's radar. Coupled with a team that has respected qualifications and experience in performance measurement, and an official and clearly articulated role in coordinating and facilitating performance measurement organisation-wide, this gives performance measurement lots of healthy credibility.

PRO: Organisation. A single place to go looking for useful templates, time-saving tools, up to date information on strategic goals and current measures, the latest performance data - imagine that! A good Corporate Performance Office will be the single port of call for all things measurement, conserving the blood, sweat and tears of managers and employees to pour into operational priorities instead.

PRO: Efficiency. When the performance measurement system has a central hub like a Corporate Performance Office, the potential for erradicating duplication of effort in measure design, data collection, analysis and reporting is grand. Who's going to complain about having to spend less time copying and pasting data from one spreadsheet into another, and reformatting the monthly report every month? Their time is better spent improving performance, not reporting it.

PRO: Consistency. When the Corporate Performance Office facilitates a consistent process for designing, implementing and using performance measures right across the organisation, it makes it heaps easier for everyone to link to strategy, collaborate across functional and departmental boundaries, and no one is left behind to struggle with outdated measurement methods.

PRO: Cost Decrease. The hidden costs of mountains of data management, maintaining myriad dashboard systems, and manual performance reporting aren't to hard to expose, and when you do expose them, you can see how potent a Corporate Performance Office - focused on organisation, efficiency and consistency - would be in stripping back these costs.

CON: Cost Increase. Employing people in performance measurement roles full time has a cost. But this cost needs to be seen in the context of the hidden costs that are already there, like duplication of reporting, rework and wasted time in finding meaningful measures, missed opportunities to improve performance due to measures not being linked to strategy and operational priorities.

CON: Threat. Some people won't like having the joys and freedom of ad hoc performance measurement taken away from them. They won't buy in to new methods of measuring and managing performance, even if they work better. If that's the attitude, then maybe you really do need a Corporate Performance Office to change the performance culture!

CON: Finding People. It's true that the field of performance measurement hasn't been professionalised yet, and that makes it hard to find people with convincing skills in performance measurement and management. This can be a setback for creating a Corporate Performance Office, but there are programs out there for acquiring these skills, and many people whose experience means they're at least part way there already.

TAKING ACTION:

Grab some coloured pens, unlined paper, and a coffee (or beverage of choice) and fantasise for a while: How would YOU design your Corporate Performance Office if you got the green light and a clean slate?

#37 The Third of Three Things I Don't Like About The Balanced Scorecard

In the first part of this three part series, I posed the first challenge that I face with the Balanced Scorecard: it is hard to cascade meaningfully. And in part two was the second challenge: the Balanced Scorecard perspectives are too limiting.

The third thing I don't like about it is this:

CHALLENGE 3: The Balanced Scorecard is not a performance measurement methodology.

How dare I utter such a blasphemous suggestion!

But I truly beleive it. The Balanced Scorecard is, in my book, far more a strategy design methodology than a performance measurement methodology. And here's why: A performance measurement methodology has to go much further than just suggesting how to determine a balanced and cause-effect linked strategy.

A performance measurement methodology has to help you design and implement and use performance measures, too:

1. It has to help you find meaningful measures, particularly when the strategies seem at first to be immeasurable. There are many Balanced Scorecards that are filled with lame, vague measures when they don't have to be.
2. It has to help you nut out the details of your measures, so they can be implemented as intended. Too many of our performance measures are poor substitutes for what we originally intended them to be, because not enough thought went into the appropriate calculation and data requirements.
3. It has to help you analyse and report your measures so they clearly and engagingly tell the story of actual performance.
4. It has to help you engage people to measure performance willingly and honestly, and as easily as possible so the measures have the best chance of truthfully telling the story of performance.
5. It has to help you validly interpret the quantitative information that the performance measures are providing, so decisions are based on patterns and trends instead of knee-jerk reactions to individual points of data.

The Balanced Scorecard does nothing to help you with these challenges. It isn't a performance measurement methodology - it's a strategy design methodology.

But before you think I'm on a one-woman mission to bag the bejesus out of the Balanced Scorecard, let me say this: I don't advocate you don't use it, I just want you to be aware of its limitations despite its popularity, and make sure you take from its strengths and compensate for its weaknesses.

TAKING ACTION:
Do you have a step-by-step performance measurement process to populate your Balanced Scorecard with meaningful measures, and then implement and use those measures to execute and achieve the strategy implied by your Balanced Scorecard?