Question

Measuring and evaluating performance is important to managers. They need to explore how individual and performance measures and other measures can be combined to create a better tool for measuring past performance and driving the future achievement of strategic goals. The book lists a few different methods of performance measures, which include Lagging indicators, Leading indicators, Non-financial measures, Bench-marking, and Best practices. If you had a choice, pick one of these 5 measures, explain why you would use it over the others, and how you would implement it.

Answer 1

Bench-marking is the process of comparing the company's performance against the standard or those with the best practices in the field. Its goal is to find top-tier procedures, understand these methods, and incorporate, if not, innovate them into their own operations in order to enhance performance and gain strategic advantage. These data gathered would be both financial and non-financial in nature, and as compared to past and future performance indicators, would allow real-time comparison of processes within and outside the company. Internal bench-marking may done with other operations of similar nature inside the firm, or external with competitors of the same the field. It would be done by initially identifying which product or service would be studied, establishing its key performance indicators, scoping to whom it shall be bench-marked with, collecting and analyzing the data on which practices are exceptional, and finally, implementing the said procedures and their regular evaluation for comparison.