Performance Management Blog

Archive for September, 2010

Measuring the well-being of children – Key National Indicators 2010

Tuesday, September 7th, 2010

A recent edition of the America’s Children: Key National Indicators of Well-Being report, published each year since 1997 by the Federal Interagency Forum on Child and Family Statistics, presents updated results with regards to the well-being of children and families living in the USA.

The report covers several children and youth well-being domains such as: family and social environment, economic circumstances, healthcare, physical environment and safety, behavior, education, and health. Its purpose is to provide statistical information on children and families in an easy-to-use format in order to stimulate discussion among data providers, policy makers and members of the public (The Federal Interagency Forum on Child and Family Statistics, 2010).

Children ages 0–17 covered by health insurance at some time during the year by type of health insurance, 1987–2008

Source: The Federal Interagency Forum on Child and Family Statistics (2010)

Children with health insurance (public or private) are more likely than children without insurance to have a regular and accessible source of health care.

The figure above indicates that in 2008, 90% of children had health insurance coverage at least some time during the year, while the number of children without coverage at any time during the year reached up to 7.3 million. The percentage of children with public health insurance increased with 2% since 2007, reaching up to 33% in 2008.

Among other statistically significant results within the report are:

The decrease in births to adolescents, from 22.2 per 1,000 girls ages 15–17 to 21.7 per 1,000
Eighth graders’ average mathematics scale score increased, from 281 to 283
The proportion of youth ages 16–19 neither enrolled in school nor working increased from 8% to 9%.

References:

The Federal Interagency Forum on Child and Family Statistics 2010, America’s Children In Brief: Key National Indicators of Well-Being, 2010, available at: http://www.childstats.gov/americaschildren/index.asp (accessed 06 September 2010)

Tags: America's Children, Health Insurance Coverage, Key National Indicators of well being, National Statistics, The Federal Interagency Forum on Child and Family Statistics
Posted in Government, KPI, Performance Measurement | No Comments »

The European Life Long Learning Index (ELLI) 2010

Monday, September 6th, 2010

A recent study „The European ELLI Index 2010 – Making Lifelong Learning Tangible!“ presents the results of the European Lifelong Learning Index for 2010 and compares Europe’s progress in lifelong learning. The European Lifelong Learning Index (ELLI) is used on annual basis to measure the performance of learning throughout different stages and learning environments (school, community, work, home life).

This index measures learning in four domains based on the UNESCO framework completed by Jaques Delors:

learning to know - formal education
learning to do – vocational learning
learning to live – learning for social cohesion
learning to be – learning as personal growth.

Source: ELLI (2010)

ELLI is a Composite Index that compiles 36 indicators that reflect learning perspectives. This measurement instrument combines indicators and statistics in order to measure, monitor and analyze trends at regional and international level. Some of the indicators presents learning activities, such as:

% Participation rate in formal and training courses
% Employees participating in vocational training
% Participation in active citizenship
% Participation in cultural activities etc.

Besides the country comparison, the study illustrates the ELLI concept and methodology, as well as how fundamental interrelations between lifelong learning, social and individual wellbeing are taken account for in the index (ELLI, 2010).

References:

ELLI 2010, The European ELLI Index 2010 – Making Lifelong Learning Tangible!, available at: http://www.deutscher-lernatlas.de/ (accessed 3 September 2010)

Tags: Composite Index, ELLI Index, Life Long Learning
Posted in Government, Index, Measure, Performance Management, Performance Measurement | No Comments »

10 Key Performance Indicators for 2010

Saturday, September 4th, 2010

smartKPIs.com Performance Architect update 35/2010

smartKPIs.com contains over 5,000 KPI examples from 14 functional areas and 24 industries. A question raised by many is: ‘If you are to pick a handful, which ones would stand out?’

I have selected below 10 KPI examples of what we consider to be smartKPIs: they are widely used and relevant, the superstars of KPIs. This is not to say any company should use them. Simply, a list of 10 KPI examples anyone should take note of:

% Net profit rate – A profitable business is a sustainable business. It is however important to have realistic expectations. Returns of over 30% may be speculative, while in some economies returns of under 5% are lower than interest rates.

$ Revenue – Growing revenue is an expression of having the right product/service mix, supported by the right team delivered at the right time. Converting opportunities in sales is the essence of a sustainable business.

% Profitable customers – getting the balance right is the basis for financial success. Although oftentimes it is difficult to track, it is ads a great deal of insight and informs decision making. Activity based costing is key to getting this indicator right.

# Net Promoter Score – having customers that are not only satisfied, but are actively endorsing a company/product/service. Recently is has become a favourite indicator of customer satisfaction, due to its simplicity and relevance.

% On-time delivery – an operational focused KPI with wide reaching implications. It can be used in a variety of industries and functional areas, as time is an important resource to anyone. Oftentimes it acts as a bottleneck as it is influenced by many indicators and it impacts a great deal of other indicators.

% Projects on time, on budget and according to specifications – getting the triangle right is difficult and priorities may vary from one project to another. It is however a useful base to start from. Can be customised as per the preference of project boards and project managers to cover only specific aspect of the triangle.

% Processes optimised – one key managerial responsibility is creating the right environment for the staff members to operate in. This includes using a management system that is well thought of and refined. Mapping and improving work processes is key to using a performance oriented architecture.

# Employee engagement – Some say money can’t buy it. It is that extra level of commitment that is induced by motivating purposes, inspiring leaders and working environments that facilitate happiness in the professional life.

# Proposed improvement ideas per employee – inspired by H.W. Heinrich’s work in the 1930s or “the Pyramid Theory” as some call it. They main results are visible at the top, but you need to monitor the base to ensure the right outcomes are achieved.

$ Investment in learning per employee – Not the ideal indicator of training impact, but a widely used substitute. It monitors both training spend and the wide allocation of funds to avoid serial trainees.

An issue with KPI examples is that names don’t tell the complete story. To find out more about each of these examples and thoroughly understand them a separate blog post would be required for each, complemented by a complete KPI documentation form. In the meantime, www.smartKPIs.com is available to further explore relevant and well documented KPI examples.

Stay smart! Enjoy smartKPIs.com!

Aurel Brudan
Performance Architect,
www.smartKPIs.com

Walker, Rob 1992, “Rank Xerox – Management Revolution”, Long Range Planning, Vol. 25, No. 1, pp. 9 to 21

Tags: Employee Engagement, Heinrich, ideas per employee, Net profit rate, Net Promoter Score, On-time delivery, Processes optimised, Profitable customers, Projects on budget, Pyramid Theory, Revenue, training spend per employee
Posted in KPI, Library of KPI examples, Measure, Performance Architect update, Performance Management, Performance Measurement, smartKPIs.com | No Comments »

Performance Management for Small and Medium Sized Enterprises (SMEs)

Friday, September 3rd, 2010

Small and medium-sized enterprises (SMEs) have particular characteristics (such as limited resources, strong personal influence of the owner-manager etc.) that make the management of their operations and strategy different from those of large corporations. Oftentimes strategy is not that well-articulated, processes are not that configured and there are not so many standards and management procedures.

Analyzing how performance management and measurement can add value in such a context, considering the resources it requires and the particularities of SMEs, can be extremely valuable for small business owners. However, literature and practice have rather a limited contribution to describing performance management in SMEs and evaluating the adequacy of practices in this context (Hudson, Smart & Bourne 2004). The limitation of resources in the case of SMEs determines that dimensions such as quality and timing are critical in order to attain high levels of productivity. Also, reliance on a limited number of customers determines that in order to keep their share of the market, SMEs deliver high levels of customer satisfaction and have be very flexible to changes in the market. From a financial point of view, profitability, costs analysis and revenues are crucial for both large and small businesses, but in the case of SMEs, they find it more difficult to accommodate to short-term fluctuations. Flatter organizational structures that usually characterize SMEs make that an employee has more job roles and sometimes more complex and demanding. Thus, motivation and training are vital to have well functioning human resources in SMEs.

Utturkar & Sengupta (2010) argue that in small and medium organizations, the time taken for mistakes to cause effects is far less than in large organizations, thus periodic appraisals are vital to avoid themAccording to them, the performance management system in SMEs should:

Make sense in the business context
Correlate to the organizational culture
Match the business and workforce’s level of maturity
Be process, not compliance focused

Source: Uttarkar & Sengupta (2010)

The main drawback of implementing performance management in SMEs comes from the resources and time it requires. However, to surmount these barriers, the approach to emplyying perfromance management principles in SMEs needs to be very resource effective and produce both short time and long time effects (i.e. short time focus is a common characteristic in SMEs, thus momentum and enthusiasm should be kept). It should also be flexible enough to accommodate repeated strategic changes. In other words, to keep the relevance of the performance measures, the process should be iterative so as to regularly surface the current strategy (Hudson, Smart & Bourne 2004).

References

Hudson, M, Smart, A & Bourne, M 2004, ‘Theory and practice in SME performance measurement systems,’ International Journal of Operations & Production Management, vol. 21, no. 8, pp. 1096 – 1115.

Uttarkar, S & Sengupta, M 2010, Performance Management for SMEs, available at: http://smejoinup.wordpress.com/2010/03/28/performance-management-for-smes/ (accessed 1 September 2010)

Tags: Mike Bourne, Performance Management for SMEs, SME Performance Management System, SMEs
Posted in Performance Management | No Comments »

Measuring performance in non-profit organisations

Thursday, September 2nd, 2010

A recent www.smartKPIs.com blog post, ‘Social and Financial Performance of Microfinance Institutions’, outlined that Microfinance Institutions (MFIs) are strongly associated with a social mission, therefore MFIs performance focuses both on social impact and financial outcomes (smartKPIs.com, 2010).

In turn, Non-profit organisations manage and measure performance using various KPIs in order to cover social impact performance, financial and grant performance, as well as effectiveness and other operational aspects. However, in comparison to MFIs, non-profit organisations use specific KPIs for their domain and less customer oriented indicators.

A newly published KPI in practice, The Global Fund to Fight AIDS, Tuberculosis and Malaria, presents a customized approach regarding performance management, by developing its own performance framework with annual KPIs for review.

Their performance framework is shaped as a pyramid, building from an assessment of the core functions of the Global Fund Secretariat at the base, through evaluation of grant performance and the effectiveness of Global Fund financing, to measuring the impact achieved on the three epidemics: AIDS, Tuberculosis and Malaria (The Global Fund, 2010).

Framework Overview

Source: The Global Fund (2010)

The performance framework implementation presents the following benefits:

differentiating the organizational performance of the Global Fund and the performance of the Secretariat’s internal operations
facilitating the assignment of responsibilities to different teams
offering a stable and comprehensive measurement framework over time
grouping KPIs into different areas of performance
aligning the reporting frequencies with the data availability and reporting systems (The Global Fund, 2010).

For additional information with regards to The Global Fund KPI in practice and for further examples of non-profit performance reports explore the Non-Profit / Non-governmental KPIs in practice section of smartkpis.com (smartKPIs.com 2010).

References:

The Global Fund 2010, Key Performance Indicators, available at: http://www.theglobalfund.org/en/performance/kpi/ (accessed 1 September 2010)

smartKPIs.com 2010, Social and Financial Performance of Microfinance Institutions, available at: http://www.smartkpis.com/blog/2010/06/02/social-and-financial-performance-of-microfinance-institutions/ (accessed 1 September 2010)

smartKPIs.com 2010, Non-Profit / Non-governmental KPIs in practice, available at: http://www.smartkpis.com/kpi_examples_in_practice/industries/non-profit-non-governmental/ (accessed 1 September 2010)

Tags: Microfinance Institutions, Non-Profit, Social Performance, The Global Fund
Posted in Case Study, KPIs in practice, Performance Management, Performance Measurement, smartKPIs.com | No Comments »

2010 winners of the Euromoney Awards for Excellence in Banking

Wednesday, September 1st, 2010

The most prestigious awards in the global banking industry – the Euromoney Awards for Excellence – have reached their 19^th edition, announcing the winners for the year 2010.

Credit Suisse was awarded the title of best global bank, considered by Euromoney the best-run bank in the world today, due to its successful execution on a new strategy and high returns on a rather low-risk business model (Euromoney 2010).

For the category best investment bank, the winner was Deutsche Bank, also appraised for its ability to produce superior results and provide value for the clients, while fundamentally renewing its core model, reducing risk and facing high staff turnover.

The title for the first banker of the year has been awarded to Vikram Pandit, the man who restructured Citigroup, restoring the bank to profitability.

As for the 2009 winner of the best global bank award, HSBC, the bank had another successful year in 2010, winning four awards (more than any other bank), among which the prestigious emerging markets bank of the year.

About Euromoney Awards for Excellence

The Awards for Excellence are released annually since 1992 by the most prestigious financial markets magazine, Euromoney.

To establish the winners for each category, banks are invited to submit their credentials which are analyzed by a committee of senior journalists from Euromoney, chaird by the editor, Clive Horwood. 25 global awards for banking and capital markets and best banks and securities houses are now incorporated (such as best global bank, best M&A house, banker of the year, regional award winners and country award winners by region).

Source: Euromoney (2010)

The methodology combines qualitative data with informed subjective judgments to award the financial institutions that bring the highest level of service and expertise to their customers.

Reference

Euromoney, Euromoney Awards for Excelence 2010, available at: http://www.euromoney.com/Article/2621461/Category/16/ChannelPage/3312/Euromoney-Awards-for-Excellence-2010.html (accessed 30 August 2010).

Tags: Banking, Best Global Bank, Best Investment Bank, Credit Suisee, Deutsche Bank, Euromoney Awards for Excellence 2010, Vilkram Pandit
Posted in Performance Measurement | No Comments »