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Performance Measures: A Key to Organizational Success

Performance Measures: A Key to Organizational Success By: Satgin Seraj

In order to succeed in today's complex, fast paced and competitive business environment, organizations need to utilize tools that help them gain and maintain a strong position in their industry. More specifically, management needs to utilize comprehensive tools that help them track and analyze projects, employees, processes, etc. There are many circumstances in which the aforementioned, as well as, other factors, do not function in the capacity or manner that is conducive to goal achievement and success. To remedy this situation and to increase the overall knowledge regarding an organization, management needs to utilize tools that better help them achieve their goals. An essential tool that can be utilized by management to assess an organization's performance is performance measurement.

The utilization of performance measures helps organizations enhance their operation's performance. They provide both qualitative and quantitative methods to track, analyze and characterize performance. In addition, performance measures provide management with the tools needed to track an organizations progress against its strategic plan and set goals. Moreover, this measurement technique provides management with a mechanism to manage its financial and non-financial, tangible and in-tangible aspects of their organization. It is vital for an organization's success and competitiveness for managers to actively monitor and control functions. Identifying key performance indicators and measures and comparing them against established target values for those indicators, provides comprehensive and analytical methods to measure organizational performance and help monitor and control functions.

Organizations succeed when their units,


support functions and employees work together in a manner that is conducive to goal achievement. Performance measures provide tools for management to align the organization's activities, including the above, to its strategy by monitoring performance. Thus, helping management better pin point and understand strengths and weaknesses within the organization. As a result, they are better equipped to address concerns and develop strategies to enhance strengths and remedy weaknesses. There are numerous types of performance measures that can be used. One example of a performance measure that can be used is benchmarking.

Benchmarking is an effective tool that can enhance organizational performance and its overall effectiveness and efficiency. It can help management evaluate factors that affect an organization's productivity in relation to the best practices regarding the same factor(s). More specifically, benchmarking helps management to have a point of reference for measurement of various aspects and factors concerning their organization, including employee performance, project success levels, etc.

Management cannot effectively govern and manage an organization in an information vacuum. In order to facilitate the development and maintenance of an efficient and effective organization, management needs to utilize tools that provide a balanced, comprehensive and analytical perspective on their organization's strengths and weaknesses. A fundamental tool that can be utilized to attain such a perspective is performance measurement, which includes benchmarking. On a final note, a balanced approach to performance planning, measurement and management is a key component to help an organization better achieve success and maintain a strong position in their industry.

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