Linking risk and performance management systems

Margaret Woods discusses lessons from the UK's too organizations on integrating risk and performance management.

Integrating risk management with performance management

This article argues that, post Enron, governance reforms around the world have served to raise the profile of risk management, and emphasise the need for a corporate wide approach to internal control that is overseen by the Board of Directors. In the US, this is most clearly demonstrated by the emergence of Enterprise Risk Management (ERM), defined as 'a process, effected by an entity's board of directors, management and other personnel, applied in strategy setting across the enterprise, designed to identify potential events that may affect the entity, and manage risk to be within its risk appetite, to provide reasonable assurance regarding the achievement of entity objectives.' (COSO, 2004, p.2). In practical terms, however, the introduction of an enterprise wide holistic risk management system poses a big challenge to all but the smallest of organisations. The financial crisis has clearly shown that enterprise wide risk management remains a dream rather than a reality for even the world's largest and once highly respected companies.

Performance management of event processing systems

This thesis is a study of performance management of Complex Event Processing (CEP) systems. Since CEP systems have distinct characteristics from other well-studied computer systems such as batch and online transaction processing systems and database-centric applications, these characteristics introduce new challenges and opportunities to the performance management for CEP systems. Methodologies used in benchmarking CEP systems in many performance studies focus on scaling the load injection, but not considering the impact of the functional capabilities of CEP systems. This thesis proposes the approach of evaluating the performance of CEP engines’ functional behaviours on events and develops a benchmark platform for CEP systems: CEPBen. The CEPBen benchmark platform is developed to explore the fundamental functional performance of event processing systems: filtering, transformation and event pattern detection. It is also designed to provide a flexible environment for exploring new metrics and influential factors for CEP systems and evaluating the performance of CEP systems. Studies on factors and new metrics are carried out using the CEPBen benchmark platform on Esper. Different measurement points of response time in performance management of CEP systems are discussed and response time of targeted event is proposed to be used as a metric for quality of service evaluation combining with the traditional response time in CEP systems. Maximum query load as a capacity indicator regarding to the complexity of queries and number of live objects in memory as a performance indicator regarding to the memory management are proposed in performance management of CEP systems. Query depth is studied as a performance factor that influences CEP system performance.

Handbook of research on strategic performance management and measurement using data envelopment analysis

Organizations can use the valuable tool of data envelopment analysis (DEA) to make informed decisions on developing successful strategies, setting specific goals, and identifying underperforming activities to improve the output or outcome of performance measurement. The Handbook of Research on Strategic Performance Management and Measurement Using Data Envelopment Analysis highlights the advantages of using DEA as a tool to improve business performance and identify sources of inefficiency in public and private organizations. These recently developed theories and applications of DEA will be useful for policymakers, managers, and practitioners in the areas of sustainable development of our society including environment, agriculture, finance, and higher education sectors. All rights reserved.

Performance management and high performance work practices in emerging markets

In this chapter, we discuss performance management systems (PMSs) and high performance work systems (HPWSs) in emerging economies. We start by discussing PMSs, with specific emphasis on PMSs in global organizations. We follow this up with an introduction of HPWSs, and then discuss PMSs and HPWSs in emerging economies. While the list of emerging economies keeps changing, and is rather long, as one might expect, in this chapter we have concentrated on five key emerging economies – China, India, Mexico, South Korea, and Turkey. Performance management is the process through which organizations set goals, determine standards, assign and evaluate work, coach and give feedback, and distribute rewards (Fletcher, 2001). In this connection, organizations all over the world face the challenge of how best to manage performance, including finding ways to motivate employees to sustain high levels of performance. In other words, organizations must develop and implement PMSs that are appropriate for their environment in such a way that high levels of performance can be achieved and sustained over time (DeNisi, Varma and Budhwar, 2008). While all organizations need to address these issues, the way a firm decides to go about addressing these issues is dependent on its location and context. In other words, differences in local norms, culture, law, and technology, make it critical that organizations develop and/or adapt techniques, policies and practices that are appropriate to the setting (see for example, Hofstede, 1993).

The complements towards developing a new risk management framework and Its applicability to the Nigerian power sector

The availability of regular supply has been identified as one of the major stimulants for the growth and development of any nation and is thus important for the economic well-being of a nation. The problems of the Nigerian power sector stems from a lot of factors culminating in her slow developmental growth and inability to meet the power demands of her citizens regardless of the abundance of human and natural resources prevalent in the nation. The research therefore had the main aim of investigating the importance and contributions of risk management to the success of projects specific to the power sector. To achieve this aim it was pertinent to examine the efficacy of risk management process in practice and elucidate the various risks typically associated with projects (Construction, Contractual, Political, Financial, Design, Human resource and Environmental risk factors) in the power sector as well as determine the current situation of risk management practice in Nigeria. To address this factors inhibiting the proficiency of the overarching and prevailing issue which have only been subject to limited in-depth academic research, a rigorous mixed research method was adopted (quantitative and qualitative data analysis). A review of the Nigeria power sector was also carried out as a precursor to the data collection stage. Using purposive sampling technique, respondents were identified and a questionnaire survey was administered. The research hypotheses were tested using inferential statistics (Pearson correlation, Chi-square test, t-test and ANOVA technique) and the findings revealed the need for the development of a new risk management implementation Framework. The proposed Framework was tested within a company project, for interpreting the dynamism and essential benefits of risk management with the aim of improving the project performances (time), reducing the level of fragmentation (quality) and improving profitability (cost) within the Nigerian power sector in order to bridge a gap between theory and practice. It was concluded that Nigeria’s poor risk management practices have prevented it from experiencing strong growth and development. The study however, concludes that the successful implementation of the developed risk management framework may help it to attain this status by enabling it to become more prepared and flexible, to face challenges that previously led to project failures, and thus contributing to its prosperity. The research study provides an original contribution theoretically, methodologically and practically which adds to the project risk management body of knowledge and to the Nigerian power sector.

Modelling the relationship between local logistics management decisions and overall supply chain performance:A research agenda

Supply chains are advocated widely as being the new units for commercial competition and developments have made the sharing of supply chain wide information increasingly common. Most organisations however still make operational decisions intended to maximise local organisational performance. With improved information sharing a holistic focus for operational decisions should now be possible. The development of a pan supply chain performance framework requires an examination of the conditions under which holistic-decisions provide benefits to either the individual enterprise or the complete supply chain. This paper presents the background and supporting methodology for a study of the impact of an overall supply chain performance metric framework upon local logistics decisions and the conditions under which such a framework would improve overall supply chain performance. The methodology concludes a simulation approach using a functionally extended Gensym's e-SCOR model, together with case based triangulation, to be optimum. Copyright © 2007 Inderscience Enterprises Ltd.

Managing people and performance:An evidence based framework applied to health service organizations

People and their performance are key to an organization's effectiveness. This review describes an evidence-based framework of the links between some key organizational influences and staff performance, health and well-being. This preliminary framework integrates management and psychological approaches, with the aim of assisting future explanation, prediction and organizational change. Health care is taken as the focus of this review, as there are concerns internationally about health care effectiveness. The framework considers empirical evidence for links between the following organizational levels: 1. Context (organizational culture and inter-group relations; resources, including staffing; physical environment) 2. People management (HRM practices and strategies; job design, workload and teamwork; employee involvement and control over work; leadership and support) 3. Psychological consequences for employees (health and stress; satisfaction and commitment; knowledge, skills and motivation) 4. Employee behaviour (absenteeism and turnover; task and contextual performance; errors and near misses) 5. Organizational performance; patient care. This review contributes to an evidence base for policies and practices of people management and performance management. Its usefulness will depend on future empirical research, using appropriate research designs, sufficient study power and measures that are reliable and valid.

A framework for assessing business-incubation input, process and output performance:proceedings of the RENT XXVII Conference, 20-22 November 2013, Vilnius, Lithuania

With business incubators deemed as a potent infrastructural element for entrepreneurship development, business incubation management practice and performance have received widespread attention. However, despite this surge of interest, scholars have questioned the extent to which business incubation delivers added value. Thus, there is a growing awareness among researchers, practitioners and policy makers of the need for more rigorous evaluation of the business incubation output performance. Aligned to this is an increasing demand for benchmarking business incubation input/process performance and highlighting best practice. This paper offers a business incubation assessment framework, which considers input/process and output performance domains with relevant indicators. This tool adds value on different levels. It has been developed in collaboration with practitioners and industry experts and therefore it would be relevant and useful to business incubation managers. Once a large enough database of completed questionnaires has been populated on an online platform managed by a coordinating mechanism, such as a business incubation membership association, business incubator managers can reflect on their practices by using this assessment framework to learn their relative position vis-à-vis their peers against each domain. This will enable them to align with best practice in this field. Beyond implications for business incubation management practice, this performance assessment framework would also be useful to researchers and policy makers concerned with business incubation management practice and impact. Future large-scale research could test for construct validity and reliability. Also, discriminant analysis could help link input and process indicators with output measures.

An online assessment and development tool for business incubators:optimising business-incubation management practice, performance and impact, Project Report

This project is focused on exchanging knowledge between ABS, UKBI and managers of business incubators in the UK. The project relates to exploitation of extant knowledge-base on assessing and improving business incubation management practice and performance and builds on two earlier studies. It addresses a pressing need for assessing and benchmarking business incubation input, process and outcome performance and highlighting best practice. The overarching aim of this project was to obtain proof-of-concept for a business incubation performance assessment and benchmarking online tool, fine-tune it and put it in use by nurturing a community of business incubation management practice, aligned by the resultant tool. The purpose was to offer an appropriate set of measures, in areas identified by relevant research on business incubation performance management and impact as critical, against which: 1.The input and process performance of business incubation management practice can be assessed and benchmarked within the auspices of a community of incubator managers concerned with best practice 2.The outcome performance and impact of business incubators can be assessed longitudinally. As such, the developed online assessment framework is geared towards the needs of researchers, policy makers and practitioners concerned with business incubation performance, added value and impact.

Managing healthcare quality using logical framework analysis

Purpose - The purpose of this paper is to develop an integrated quality management model that identifies problems, suggests solutions, develops a framework for implementation and helps to evaluate dynamically healthcare service performance. Design/methodology/approach - This study used the logical framework analysis (LFA) to improve the performance of healthcare service processes. LFA has three major steps - problems identification, solution derivation, and formation of a planning matrix for implementation. LFA has been applied in a case-study environment to three acute healthcare services (Operating Room utilisation, Accident and Emergency, and Intensive Care) in order to demonstrate its effectiveness. Findings - The paper finds that LFA is an effective method of quality management of hospital-based healthcare services. Research limitations/implications - This study shows LFA application in three service processes in one hospital. This very limited population sample needs to be extended. Practical implications - The proposed model can be implemented in hospital-based healthcare services in order to improve performance. It may also be applied to other services. Originality/value - Quality improvement in healthcare services is a complex and multi-dimensional task. Although various quality management tools are routinely deployed for identifying quality issues in healthcare delivery, they are not without flaws. There is an absence of an integrated approach, which can identify and analyse issues, provide solutions to resolve those issues, develop a project management framework to implement those solutions. This study introduces an integrated and uniform quality management tool for healthcare services. © Emerald Group Publishing Limited.

Integrated approach to healthcare quality management:a case study

Purpose - The purpose of the paper is to develop an integrated quality management model, which identifies problems, suggests solutions, develops a framework for implementation and helps evaluate performance of health care services dynamically. Design/methodology/approach - This paper uses logical framework analysis (LFA), a matrix approach to project planning for managing quality. This has been applied to three acute healthcare services (Operating room utilization, Accident and emergency, and Intensive care) in order to demonstrate its effectiveness. Findings - The paper finds that LFA is an effective method of quality management of hospital-based healthcare services. Research limitations/implications - This paper shows LFA application in three service processes in one hospital. However, ideally this is required to be tested in several hospitals and other services as well. Practical implications - In the paper the proposed model can be practised in hospital-based healthcare services for improving performance. Originality/value - The paper shows that quality improvement in healthcare services is a complex and multi-dimensional task. Although various quality management tools are routinely deployed for identifying quality issues in health care delivery and corrective measures are taken for superior performance, there is an absence of an integrated approach, which can identify and analyze issues, provide solutions to resolve those issues, develop a project management framework (planning, monitoring, and evaluating) to implement those solutions in order to improve process performance. This study introduces an integrated and uniform quality management tool. It integrates operations with organizational strategies. © Emerald Group Publishing Limited.

Establishing a framework for dynamic risk management in 'intelligent' aero-engine control

The behaviour of control functions in safety critical software systems is typically bounded to prevent the occurrence of known system level hazards. These bounds are typically derived through safety analyses and can be implemented through the use of necessary design features. However, the unpredictability of real world problems can result in changes in the operating context that may invalidate the behavioural bounds themselves, for example, unexpected hazardous operating contexts as a result of failures or degradation. For highly complex problems it may be infeasible to determine the precise desired behavioural bounds of a function that addresses or minimises risk for hazardous operation cases prior to deployment. This paper presents an overview of the safety challenges associated with such a problem and how such problems might be addressed. A self-management framework is proposed that performs on-line risk management. The features of the framework are shown in context of employing intelligent adaptive controllers operating within complex and highly dynamic problem domains such as Gas-Turbine Aero Engine control. Safety assurance arguments enabled by the framework necessary for certification are also outlined.

Real options and multinational investments : an empirical study of risk, performance and organisational awareness

DUE TO COPYRIGHT RESTRICTIONS ONLY AVAILABLE FOR CONSULTATION AT ASTON UNIVERSITY LIBRARY AND INFORMATION SERVICES WITH PRIOR ARRANGEMENT This thesis is a cross-disciplinary study of the empirical impact of real options theory in the fields of decision sciences and performance management. Borrowing from the economics, strategy and operations research literature, the research examines the risk and performance implications of real options in firms’ strategic investments and multinational operations. An emphasis is placed on the flexibility potential and competitive advantage of multinational corporations to explore the extent to which real options analysis can be classified as best practice in management research. Using a combination of qualitative and quantitative techniques the evidence suggests that, if real options are explored and exploited appropriately, real options management can result in superior performance for multinational companies. The qualitative findings give an overview of the practical advantages and disadvantages of real options and the statistical results reveal that firms which have developed a high awareness of their real options are, as predicted by the theory, able to reduce their downside risk and increase profits through flexibility, organisational slack and multinationality. Although real options awareness does not systematically guarantee higher returns from operations, supplementary findings indicate that firms with evidence of significant investments in the acquisition of real options knowledge tend to outperform competitors which are unaware of their real options. There are three contributions of this research. First, it extends the real options and capacity planning literature to path-dependent contingent-claims analysis to underline the benefits of average type options in capacity allocation. Second, it is thought to be the first to explicitly examine the performance effects of real options on a sample of firms which have developed partial capabilities in real options analysis suggesting that real options diffusion can be key to value creation. Third, it builds a new decision-aiding framework to facilitate the use of real options in projects appraisal and strategic planning.

Green supply chain performance measurement using the analytic hierarchy process:a comparative analysis of manufacturing organisations

The main purpose of this research is to develop and deploy an analytical framework for measuring the environmental performance of manufacturing supply chains. This work's theoretical bases combine and reconcile three major areas: supply chain management, environmental management and performance measurement. Researchers have suggested many empirical criteria for green supply chain (GSC) performance measurement and proposed both qualitative and quantitative frameworks. However, these are mainly operational in nature and specific to the focal company. This research develops an innovative GSC performance measurement framework by integrating supply chain processes (supplier relationship management, internal supply chain management and customer relationship management) with organisational decision levels (both strategic and operational). Environmental planning, environmental auditing, management commitment, environmental performance, economic performance and operational performance are the key level constructs. The proposed framework is then applied to three selected manufacturing organisations in the UK. Their GSC performance is measured and benchmarked by using the analytic hierarchy process (AHP), a multiple-attribute decision-making technique. The AHP-based framework offers an effective way to measure and benchmark organisations’ GSC performance. This study has both theoretical and practical implications. Theoretically it contributes holistic constructs for designing a GSC and managing it for sustainability; and practically it helps industry practitioners to measure and improve the environmental performance of their supply chain. © 2013 Copyright Taylor and Francis Group, LLC. CORRIGENDUM DOI 10.1080/09537287.2012.751186 In the article ‘Green supply chain performance measurement using the analytic hierarchy process: a comparative analysis of manufacturing organisations’ by Prasanta Kumar Dey and Walid Cheffi, Production Planning & Control, 10.1080/09537287.2012.666859, a third author is added which was not included in the paper as it originally appeared. The third author is Breno Nunes.