Measure and Evaluate the Corporate Performance Management System

The following performance measures can be used to evaluate whether elements of the CPM system are working effectively:

Key Performance Indicator (KPI) Ratio: This refers to the number of KPIs as a percentage of the total number of performance measures. KPIs should measure progress related to goals and strategy; often a KPI is an aggregation of underlying measures.

Performance — Projections: This measures the percentage of key indicators with 2-5 year targets. This measure provides an indication on whether an organisation is planning ahead.

Employee Involvement — Organisational Performance: This refers to the frequency of consultation of non-managerial employees for organisational performance review or analysis. This measure can be used to assess an organisation’s effectiveness at communicating and involving employees in understanding its performance, as well as what needs to be done to improve performance.

Performance Measures — Number Monitored:This refers to the number of measures regularly monitored by individuals or the average number of measures monitored. This measure provides an indication of the complexity involved in monitoring the performance of individual units/functional areas/departments/processes. World-class organisations tend to have less than twenty key organisational performance metrics derived from many other underlying measures. Each responsibility level within an organisation can be set up in a similar way. This means that the number of measures gradually decreases as they are amalgamated into the few key ones that are needed to monitor performance by the next level up the organisational structure. Experts suggest that twelve is a good number to aim for across all levels of the organisation.

Performance Measurement — Clarity: Score by staff of their level of understanding of performance measures and results. This measure, commonly assessed through a survey, provides input into the effectiveness of the performance measure(s). On a corporate level, it reflects on the success of an organisation’s information management systems.

Performance — Historical: This refers to the percentage of key indicators showing performance improvements since last review. This measure provides an indication of the extent of improvement shown throughout the business.

Performance Measurement System — Review: This measures the frequency of review of the performance measurement system. This measure provides an indication of how frequently the measurement system is checked to make sure that the spread and focus of data type being collected is appropriate to achieving the organisation’s objectives and goals.

Objectives — Achieved: This measures the number of objectives achieved as a percentage of the total number of objectives. This measure provides a long-term overall indication of the effectiveness/performance of action plans developed to reach their aims.

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