Managing through measurement : A framework for successful operative level performance measurement

The research around performance measurement and management has focused mainly on the design, implementation and use of performance measurement systems. However, there is little evidence about the actual impacts of performance measurement on the different levels of business and operations of organisations, as well as the underlying factors that lead to a positive impact of performance measurement. The study thus focuses on this research gap, which can be considered both important and challenging to cover. The first objective of the study was to examine the impacts of performance measurement on different aspects of management, leadership and the quality of working life, after which the factors that facilitate and improve performance and performance measurement at the operative level of an organisation were examined. The second objective was to study how these factors operate in practice. The third objective focused on the construction of a framework for successful operative level performance measurement and the utilisation of the factors in the organisations. The research objectives have been studied through six research papers utilising empirical data from three separate studies, including two sets of interview data and one of quantitative data. The study applies mainly the hermeneutical research approach. As a contribution of the study, a framework for successful operative level performance measurement was formed by matching the findings of the current study and performance measurement theory. The study extents the prior research regarding the impacts of performance measurement and the factors that have a positive effect on operative level performance and performance measurement. The results indicate that under suitable circumstances, performance measurement has positive impacts on different aspects of management, leadership, and the quality of working life. The results reveal that for example the perception of the employees and the management of the impacts of performance measurement on leadership style differ considerably. Furthermore, the fragmented literature has been reorganised into six factors that facilitate and improve the performance of the operations and employees, and the use of performance measurement at the operative level of an organisation. Regarding the managerial implications of the study, managers who operate around performance measurement can utilise the framework for example by putting the different phases of the framework into practice.

Performance measurement oforder-delivery chain in SMEs: Case study

Tutkimus pyrkii selvittämään, kuinka tehokas suorituskykymittaristo voidaan parhaiten suunnitella pk-yrityksessä. Tutkimuksen tavoitteena on luoda suorituskykymittaristo pienen kohdeyrityksen johtajien tarpeisiin. Päähuomion kohteena on yrityksen tilaus-toimitusketju ja arvoverkko. Työ on luonteeltaan kvalitatiivinen toimintatutkimus, joka noudattaa toiminta-analyyttista tutkimusotetta. Työn teoriaosassa selvitetään, kuinka suorituskyvyn mittaaminen sekä materiaali-, tieto- ja rahavirtojen hallinta on kehittynyt viime vuosina pk-yrityksen näkökulmasta. Mittariston suunnittelu aloitetaan kohdeyrityksen perusteellisella analyysilla. Tämän pohjalta määritellään yrityksen kriittiset menestystekijät, joista lopulta johdetaan suorituskykymittarit. Tutkimuksen perusteella voidaan todeta, että yleinen asenne mittaamista kohtaan, strategian huomioinnin puute sekä tietojärjestelmien rajoitteet ovat päähaasteita pk-yrityksen suorituskyvyn mittaamisessa. Mittareiden tuleekin olla melko yksinkertaisia ja helppoja käyttää, jotta mittaamisen ei koettaisi kuluttavan rajallisia resursseja liikaa. Mittariston tulee kuitenkin antaa kokonaisvaltainen kuva yrityksen suorituskyvystä, johon vaikuttavat kaikki arvoverkon osapuolet ja heidän yhteistyö toistensa kanssa.

Performance Measurement as Part of Management

To achieve success in a constantly changing environment and with ever-increasing competition, companies must develop their operations continuously. To do this, they must have a clear vision of what they want to be in the future. This vision can be attained through careful planning and strategising. One method of transforming a strategy and vision into an everyday tool used by employees is the use of a balanced performance measurement system. The importance of performance measurement in the implementation of companies' visions and strategies has grown substantially in the last ten years. Measures are derived from the company's critical success factors and from many different perspectives. There are three time dimensions: past, present and future. Many such performance measurement systems have been created since the 1990s. This is a case study whose main objective is to provide a recommendation for how the case company could make use of performance measurement to support strategic management. To answer this question, the study uses literature-based research and empirical research at the case company's premises. The theoretical part of the study consists of two sections: introducing the Balanced Scorecard and discussing how it supports strategic management and change management. The empirical part of this study determines the company's present performance measurement situation through interviews in the company. The study resulted in a recommendation to the company to start developing the Balanced Scorecard system. By setting up this kind process, the company would be able to change its focus more towards the future, beginning to implement a more process-based organisation and getting its employees to work together towards common goals.

Developing supply chain performance measurement metrics, case Halton Oy

Tämä tutkimus pyrkii selvittämään, miten toimitusketjun suorituskykyä voidaan mitata kohdeyrityksessä. Supply Chain Council (SCC) on vuonna 1996 kehittänyt Supply Chain Operations Reference (SCOR) – mallin, joka mahdollistaa myös suorituskyvyn mittaamisen. Tämän tutkimuksen tarkoituksena on soveltaa SCOR-mallin suorituskyvyn mittausmallia kohdeyrityksessä. Työ on kvalitatiivinen tapaustutkimus. Työn teoriaosassa on pääasiallisesti käsitelty toimitusketjua ja suorituskyvyn mittaamista koskevaa kirjallisuutta. Mittausjärjestelmän luominen alkaa kohdeyrityksen esittelyllä. SCOR – mallin mittarit on kohdeyrityksessä rakennettu SCC:n ehdotusten mukaisesti, jotta mittareiden tulokset olisivat käyttökelpoisia myös benchmarkkausta varten. Malli sisältää 10 SCOR – mittaria, sekä muutamia muita Haltonin omia mittareita. Lopputuloksena voidaan nähdä, että SCOR – malli antaa hyvän yleiskuvan toimitusketjun suorituskyvystä, mutta kohdeyrityksessä on silti tarvetta kehittää edelleen informatiivisempia mittareita, jotka antaisivat yksityiskohtaisempaa tietoa kohdeyrityksen johdolle.

Defining a Performance Measurement System for Technology Marketing Team by Using the Balanced Scorecard Method

This thesis was produced for the Technology Marketing unit at the Nokia Research Center. Technology marketing was a new function at Nokia Research Center, and needed an established framework with the capacity to take into account multiple aspects for measuring the team performance. Technology marketing functions had existed in other parts of Nokia, yet no single method had been agreed upon for measuring their performance. The purpose of this study was to develop a performance measurement system for Nokia Research Center Technology Marketing. The target was that Nokia Research Center Technology Marketing had a framework for separate metrics; including benchmarking for starting level and target values in the future planning (numeric values were kept confidential within the company). As a result of this research, the Balanced Scorecard model of Kaplan and Norton, was chosen for the performance measurement system for Nokia Research Center Technology Marketing. This research selected the indicators, which were utilized in the chosen performance measurement system. Furthermore, performance measurement system was defined to guide the Head of Marketing in managing Nokia Research Center Technology Marketing team. During the research process the team mission, vision, strategy and critical success factors were outlined.

Performance Measurement of the Logistics Process

The objective of the thesis was to create a performance measurement system for the logistics process of a company. In addition, one goal was to make suggestions for improvements based on description and analysis of the process and current measures. The logistics process was described in detail, and the objectives for it were derived from the company strategy and goals. Suggestions for performance measurement system and process improvement were made based on current state analysis. As a result of the thesis, three new performance measures were decided to take into use. In addition, several improvements were suggested to the ERP system to make process smoother. Some of the improvements have already been added to the system and the rest will be added in the near future.

Harmonized performance measurement system for basic industry's service centers

The objective of this study is to create measurement system that is capable to measure performance in basic industry’s service centers. First it is examined what is performance and how it can be measured. The study also introduces commonly known measurement frameworks. After theory the study investigates how companies in the field of basic industry measure their operations in practise. The investigation is done examining three case examples and by analyzing survey results from basic industry companies. On the survey results focus is on what meters and measurement systems companies use. It is also viewed what measurement problems companies have faced. In the applied part of the study harmonized performance measurement system is created. The framework of the measurement system is introduced and measurement system for the target company is created. The target company felt that the harmonized performance measurement system has good potential and continues to develop it further.

Creating a Performance Measurement System for Accounting Services of Large Paper Company

The main objective of this research is creating a performance measurement system for accounting services of a large paper industry company. In this thesis there are compared different performance measurement system and then selected two systems, which are presented and compared more detailed. Performance Prism system is the used framework in this research. Performance Prism using success maps to determining objectives. Model‟s target areas are divided into five groups: stakeholder satisfaction, stakeholder contribution, strategy, processes and capabilities. The measurement system creation began by identifying stakeholders and defining their objectives. Based on the objectives are created success map. Measures are created based on the objectives and success map. Then is defined needed data for measures. In the final measurement system, there are total just over 40 measures. Each measure is defined specific target level and ownership. Number of measures is fairly large, but this is the first version of the measurement system, so the amount is acceptable.

Sales performance measurement and steering in a multinational company

The objective of the study is to find out how sales performance should be measured and how should sales be steered in a multinational company. The beginning of the study concentrates on the literature regarding sales, performance measurement, sales performance measurement, and sales steering. The empirical part of the study is a case study, in which the information was acquired from interviews with the key personnel of the company. The results of the interviews and the revealed problems were analyzed, and comparison for possible solutions was performed. When measuring sales performance, it is important to discover the specific needs and objectives for such a system. Specific needs should be highlighted in the design of the system. The system should be versatile and the structure of the system should be in line with the organizational structure. The role of the sales performance measurement system was seen to be important in helping sales steering. However, the importance of personal management and especially conversations were seen as really critical issue in the steering. Sales performance measurement could be based on the following perspectives: financial, market, customer, people, and future. That way the sales department could react to the environmental changes more rapidly.

Performance measurement and management in a collaborative network

This study concerns performance measurement and management in a collaborative network. Collaboration between companies has been increased in recent years due to the turbulent operating environment. The literature shows that there is a need for more comprehensive research on performance measurement in networks and the use of measurement information in their management. This study examines the development process and uses of a performance measurement system supporting performance management in a collaborative network. There are two main research questions: how to design a performance measurement system for a collaborative network and how to manage performance in a collaborative network. The work can be characterised as a qualitative single case study. The empirical data was collected in a Finnish collaborative network, which consists of a leading company and a reseller network. The work is based on five research articles applying various research methods. The research questions are examined at the network level and at the single network partner level. The study contributes to the earlier literature by producing new and deeper understanding of network-level performance measurement and management. A three-step process model is presented to support the performance measurement system design process. The process model has been tested in another collaborative network. The study also examines the factors affecting the process of designing the measurement system. The results show that a participatory development style, network culture, and outside facilitators have a positive effect on the design process. The study increases understanding of how to manage performance in a collaborative network and what kind of uses of performance information can be identified in a collaborative network. The results show that the performance measurement system is an applicable tool to manage the performance of a network. The results reveal that trust and openness increased during the utilisation of the performance measurement system, and operations became more transparent. The study also presents a management model that evaluates the maturity of performance management in a collaborative network. The model is a practical tool that helps to analyse the current stage of the performance management of a collaborative network and to develop it further.

Designing of Balanced Performance Measurement System to Purchasing Process

The performance measurement produces information about the operation of the business process. On the basis of this information performance of the company can be followed and improved. Balanced performance measurement system can monitor performance of several perspectives and business processes can be led according to company strategy. Major part of the costs of a company is originated from purchased goods or services are an output of the buying process emphasising the importance of a reliable performance measurement of purchasing process. In the study, theory of balanced performance measurement is orientated and framework of purchasing process performance measurement system is designed. The designed balanced performance measurement system of purchasing process is tested in case company paying attention to the available data and to other environmental enablers. The balanced purchasing performance measurement system is tested and improved during the test period and attention is paid to the definition and scaling of objectives. Found development initiatives are carried out especially in the scaling of indicators. Finally results of the study are evaluated, conclusions and additional research areas proposed.