Difference between revisions of "Performance Measurement"
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| − | Performance | + | Performance measurement is a management discipline that focuses on quantifying the resources consumed and results achieved from a business process or operation. The objective is to create the highest possible value for the lowest possible cost and risk. |
| − | Often, this leads to the exact opposite | + | Often, this leads to the exact opposite outcome: |
*Performance measurement becomes an end in itself consuming inordinate amount of resources and taking away focus from results | *Performance measurement becomes an end in itself consuming inordinate amount of resources and taking away focus from results | ||
*Incorrect measurement leads to wrong decisions | *Incorrect measurement leads to wrong decisions | ||
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Performance measurement's promise is not realized because managers often: | Performance measurement's promise is not realized because managers often: | ||
| − | *Pick the wrong measures or | + | *Pick the wrong measures or metrics |
*Focus on the short term | *Focus on the short term | ||
*Rely on financial measures | *Rely on financial measures | ||
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===See Also=== | ===See Also=== | ||
| − | [[ | + | *[[Balanced Scorecard]] |
| − | [[ | + | *[[IT Investment (Information Technology Investment)]] |
| − | + | *[[Project Portfolio Management (PPM)]] | |
| − | [[ | ||
Revision as of 18:18, 10 December 2022
Performance measurement is a management discipline that focuses on quantifying the resources consumed and results achieved from a business process or operation. The objective is to create the highest possible value for the lowest possible cost and risk.
Often, this leads to the exact opposite outcome:
- Performance measurement becomes an end in itself consuming inordinate amount of resources and taking away focus from results
- Incorrect measurement leads to wrong decisions
- Accurate measurement leads to wrong decisions
Performance measurement's promise is not realized because managers often:
- Pick the wrong measures or metrics
- Focus on the short term
- Rely on financial measures
- Measure what is not measurable or does not lend itself to traditional metrics
- Prefer quantitative over qualitative measures