Business Performance Management ATTENTION – THIS IS THE COURSE OF PR DANE PFLUEGER, IT IS NOT TO BE COPIED OR SOLD OR DISTRIBUTED. Business performance management is a set of performance management and analytic processes that enables the management of an organization's performance to achieve one or more pre-selected goals. Read the case before every session Learn at least one key concept or relationship for each case. INTRODUCTION – THE IMPORTANCE OF PERFORMANCE MEASUREMENT: The problem of control. Trying to address the problem of control does the solution fit the problem ? Exercise- The UK government recently set a target for all NHS hospitals to treat patients within hours of admitting them. There are no financial penalties and rewards for meeting the target, but performance in reported publicly on the Hospital Compare website. What do you think the outcome of this attempt to control NHS organisations resulted in? Vicious cycle: Hospitals that were under the limit will get a better image in people’s mind, resulting on more people coming there and getting overcrowded -> will that spread the population amongst the hospitals? Hospital staffs: if they could have done more they would have, demotivated? They have a target but no means to change it. The outcome: The managers started to make ambulances wait outside they met the target more often but totally missed the hole point and made the system less performant. What would be a better target for hospitals if the government wants to encourage prompt and safe care? Average wait time (?) More aggregated measure Customer survey - immediate Pay, direct Each one may have a set of unintended consequence There is a problem of control. How can organisations ensure that managers and employees work towards the organisation’s objectives and strategies? How do we do that while measuring the positive v. the negative consequences? 1
Why would people not act in the organisation’s interest? 1. They do not (sufficiently) know the organisation’s interest Problem of information provide employees with information that they can use when making decisions or when making sense of events: communicate on what they are supposed to focus on. 2. They do know the organisation’s interest, but they do not (sufficiently) want to contribute to it: motivation. Problem of motivation : maybe you’re highly motivated but towards something else, another result… Provide employees with results controls and incentives to act in the organisation’s interest. 3. They know the organisation’s interest and want to contribute to it, but they are not (sufficiently) able to do so. Problem of ability or knowledge Make sure that the right people are assigned the right tasks and train people adequately.
- Fall '19