Performance scorecards

Performance scorecard Predicts how the overall design will perform against its expectations and functional requirements. Once implemented, this is a summary comparison of actual-to-planned performance of the innovation. 

Component scorecard Predicts the performance of key components that affect the overall performance scorecard elements. Once implemented, this summarizes the extent to which component quality levels fulfill design intent and expectations. 

In our example braking system, we use a number of descriptive statistics at the performance, component, and process levels. For example, at the performance-scorecard level (Exhibit 39.1), to gauge the performance of our new braking system, we measure the following variables, or performance indicators ... 

Key Performance Indicators (KPIs) in supply chain balanced scorecards and performance management are one example for analysis methods. Beamon (1998) and Chan (2003) distinguish qualitative performance measures such as customer satisfaction, on-time delivery, fill rate or flexibility as well as quantitative measures based on costs in distribution, manufacturing and inventory or warehousing. 

D. Norton and R. Kaplan, The balanced scorecard—measures that drive performance, Harvard Business Revue (Jan./Feb. 1992). 

Customer relations management Implements effective key account management Monitors and updates quality performance database (scorecard)... 

BP Chemicals can be quoted as a good example in the chemical industry for having implemented a set of cascading scorecards with leading indicators and lagging measures, taking both performance and health as well as different stakeholder interests into consideration. 

Park EJ, Huber DL. 2007. Balanced scorecards for performance management. J Nurs Adm 37 14. 

The degree of divisional versus regional responsibility and accountability. The balance of divisional versus regional control can vary from the extreme of complete independence for the country managers to a situation where they have very limited control over their operations. Balanced scorecards (or a simple set of joint key performance indicators) can help to build a reference system in which both the divisional and the regional units are held mutually accountable for achieving their joint targets. 

Organization. Top-performing chemical companies create many SBUs with P L responsibility, or at least with detailed scorecards tied to their performance. The goal is to have absolute clarity of accountability and full visibility of performance results. 

To capture the business opportunities, the procurement team then needs to build a holistic business plan. The business plan mentality is critical, since it will provide the organization with a clear proposal and basis for the decision to allocate necessary resources to the planned efforts. Organizations that have pursued such an approach have created the prerequisites for performance transparency and service-oriented behavior. Possible outcomes depending on the needs of the company and the capabilities developed within procurement can range from a strong procurement network with its own profit and loss statement and balanced scorecard to the creation of a market-oriented profit center unit. The business plan should be focused primarily on value creation rather than cost savings, and should consist of two distinct parts ... 

Key performance indicators (KPI) Do the savings also lead to improvements in other performance indicators (e.g., inventory costs, product quality, etc.) Which are indicators of behavioral change / c 2-3 indicators per team Value scorecards (suppliers, procurement)... 

There are three basic elements to entrepreneurship in chemical production (Fig. 12.6). The first - estabhshing entrepreneurial focus - means that performance targets have to be set which are driven by the capital markets in a participative process starting from the top - that is, at the business unit or divisional level -and which follow through a transparent value-driver tree in order to determine targets for the front line (see Section 12.2.1). The desired end product is a balanced scorecard for each operational unit with a clear Hnk to the overall profitability of the business unit... 

For any solution, a performance expectation such as "reliability" would likely be tracked with a metric called "mean time between failures." This metric, in turn, is included in your Design Scorecards (Technique 39) for that solution. 

Performance expectations are the Key Performance Indicators (KPIs) on which you ll focus your design and optimization efforts, and which you will track over time with your Design Scorecards (Technique 39) and/or Process Behavior Charts (Technique 52). 

For innovation, the key benefit of Design Scorecards is their ability to predict the final quality of a design and recognize gaps so it can be improved before it s implemented. Is there a risk that your design will go wrong How will you know if and when it does As well, you ll have to track your new innovation after it s implemented, making sure its performance record is visible to stakeholders so they can prevent malfunctions if possible, or at least react quickly to fix problems if they do occur. 

When assembling your scorecard for your new design, keep in mind how data will be collected and reported for your performance indicators. Actual, observed indicator values may be sourced from specific test runs, data collected from usage in the field, customer satisfaction records, call center logs, and so on. 

Build a scorecard for each critical process using data from capability studies (see Process Capability, Technique 37), past experience, manufacturing data, and estimates from similar processes. You can then use this data to predict the overall performance of each of the critical processes and subprocesses. 

Some of the more common performance measurement systems used to assess pharmaceutical outcomes include report cards, balanced scorecards, clinical value compasses, profiling, performance-based evaluation systems, and others. The goals of pharmaceutical performance measurement systems are to 1) compare treatment modalities fairly 2) recognize and promote good care 3) identify and eliminate substandard care and 4) improve the level of care overall.Because performance measures can include data over the course of treatment, the outcomes of alternative therapies and practices may be detected. The end goal of any performance measurement system should not be cost containment only improving patient outcomes must be a primary concern, keeping in mind the cost effectiveness of the therapy and sustainability of the system. 

A. Performance measiires The first step in establishing an effective maintenance basics program is to identify and establish performance measures. Most experienced managers have learned that you get what you measme. Successful pharmaceutical plants develop and implement a series of supportive key performance measures to track and manage improvement of maintenance/reliability. Examples are mean time between failure, maintenance cost per unit of output, percent planned and scheduled maintenance, preventive maintenance tasks completed, expense maintenance cost as a percentage of replacement asset value, etc. These indicators must be available to aU levels of an organization and shoiild be used to maximize individual and group contributions. It would be best if these indicators were part of the reliability-balanced scorecard. 

Usually the performance of a company is assessed by financial criteria. This may seem perfectly appropriate because the survival of a company depends on adequate profits. All other objectives (e.g., the quality of products and services) are pursu not for their own sake but rather in support of financial long-term success. Within the last decade, however, researchers and practitioners have come to the conclusion that because financial criteria relate to the past, they reflect only part of a comptmy s performance. The future performance and growth of a company depend equally on soft factors that are difficult to quantify, such as the quality of leadership or the qualification of the employees. The idea of integrating soft and hard factors is realized in the beilanced scorecard concept (Kaplan tmd Norton 1996), which is gaining increasing acceptance worldwide. 

The balanced scorecard a change in what performance means and how its is measured... 

A Changing View of Performance Itself The Balanced Scorecard... 

The forces of change have altered what performance itself means. Gone are the days when financial results were aU that mattered. In today s world, organizations must dehver a combination of financial and nonfinancial performance outcomes. Readers who do not understand the new scorecard of performance will fall into the three main traps of a financial-only approach to performance management ... 

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