The Performance Prism is a performance measurement framework that has evolved from the growing importance of stakeholder requirements. The Prism has a 5-facet approach to evaluating performance. 1. Stakeholder satisfaction: In addition to considering shareholders, customers, employees, and suppliers, the Prism also incorporates regulators and pressure groups – groups of stakeholders with growing power and significance in the current business scenario. 2. Strategies: Having identified the stakeholders, managers have to measure whether the company has strategies in place to deliver stakeholder satisfaction. 3.
Processes: It is equally important to evaluate whether the organization has processes aligned to achieve those strategies. 4. Capabilities: As processes can not work on their own, they need human resources, physical infrastructures, and technologies to come into effect. This facet measures the organization’s capabilities to operate and enhance the defined processes. 5. Stakeholder Contribution: This facet reflects the need to maximize contribution that stakeholders make to support the organization. For example, if customer satisfaction is an important objective then there should also be focus on profitability from customers in return.
One of the greatest advantages of the Performance Prism is that it can be used at any level of organization with each level having unique stakeholders. Similar to the Balanced Scorecard, this tool also gives a succinct overview of the whole organization as it combines comprehensive facets at one time (Neely 2002). 2. 2. Comparison of Performance Measurement Tools While the performance frameworks have been around for sometime and praised by their proponents, they are not easily implementable. This section discusses the adoption of these tools and general feedback from users of these frameworks..
According to (Neely, Kennerley & Martinez ), between 30 and 60% of large US firm have the early version of Balanced Scorecard. The study also suggests that firms that use the Balanced Scorecard perform better than those who do not use this tool. Nonetheless, applying Balanced Scorecard it a challenge in itself. In a study (Ahn 2001), shows that the difficulties with Balanced Scorecard can be categorize in two types: those associated with developing the Balanced Scorecard and those related to implementing it.
When develop a Balanced Scorecard the problem generally arise due to insufficient recommendations related to the details of Balanced Scorecard. Companies with multiple business units generally face this difficulty as they try to develop an integrated Balanced Scorecard. The companies try to develop a comprehensive framework that can encompass the complete business. Most of time there are not any sufficient links operational or strategic that can be used to develop counterbalancing metrics. Since the metrics are not readily know, the companies cannot synergize the goals of different departments, resulting in conflicting goals.
Developing these metrics can be a cumbersome task, that can only be managed through a project management approach that uses a gradual development of metrics and usage. In terms of implementation, Balanced Scorecard can be very time consuming and demoralizing for the teams. Most of the data gathering that is used for metrics is not readily available and additional work is required on top of the existing workload for the employees. Until the employees accept that this data will be useful, they create resistance that can lead to lack of information or worse, incorrect information.
Gradual implementation is usually considered a good approach to reduce this resistance. Another approach mentioned is to cut down other measures that are not related to the Balanced Scorecard, ensuring that the introduction of Balanced Scorecard is not considered an overhead. Performance Prism is a second generation of performance measurement frameworks. It has been successfully applied in many real-life scenarios. According to (Neely, Adams & Crowe 2001) the attraction of Performance prism is that it has inherent potential to align the five components.
This show interrelationship among these components and move adaptive. The companies who implemented this system also found it to be comprehensive, allowing the implementers to drill into detail and finally felt that the framework really addresses the stakeholders. Another advantage is that Performance prism can be used to build on top of an existing Balanced Scorecard. This in turn is also shortcoming for this system as it inherits all the shortcomings of developing and implementing a Balanced Scorecard.
(Neely 2002) advises that to overcome these hurdles, at times it is a good idea to use existing implementations as an example and conduct experiments before conducting the complete exercise. This usually helps the stakeholders understand the implications and help them realize the nature of question they need to ask the data they need to acquire to develop the metrics required. 2. 3. Performance Measurement in Telecommunications The telecommunications industry is one based on services. As all other industries in the world that require services this industry is also one that needs to focus on its customers.
All service industries are customer driven and this industry is no different from the rest. Telecommunication service industry around the world is facing significant challenges from competition, technological revamps at very short frequencies and never-ending customer demands. It is an industry that continuously changes and companies in this industry are only able to make profit by servicing their client’s needs. Today, the telecommunication industry is no longer technology centric, but it revolves more around customer relationship. Customer satisfaction and marketing intelligently are the name of the game.
Innovative promotional schemes and advanced technology are the primary drivers of business. Also, cutthroat competition and mammoth investments in the telecom industry churn away profit margins and make intelligent decision making critical. The telecommunication industry thus has some KPIs on which it focuses so as to service their customers well. These KPIs are meant to capture the performance of a company and reflect how well the company is serving its customer. We will look at the first try to understand why performance measurement is necessary in context of call centers and then look at the KPIs themselves.Sample Essay of PaperDon.com