Key Performance Indicators: Developing, Implementing, and Using Winning KPIs, 3rd Edition

Chapter 5Strategy and Its Relevance to Performance Measures

Overview

“What is the purpose of performance measurement? Is it to monitor the implementation of strategic initiatives or as I believe, to help the workforce focus on the critical success factors of the business, day-in and day-out? In this chapter the linkage between strategy, critical success factors and performance measures will be shown. The difference between mission, vision, values, and management principles will be clarified. The need for a concise strategy that is clear and can be easily communicated is emphasized. The difference between “business as usual” and “new business” initiatives is clarified.

Strategy is the way an organization intends to achieve its vision. In a competitive environment, your strategy will distinguish you from your competition. In the public sector, your strategy determines the way you can best marshal your resources to achieve desired outcomes.

An organization's strategy is related to performance measures through a series of linkages as shown in Exhibit 5.1.

Exhibit 5.1 Linkages between Strategy, Critical Success Factors, and Performance Measures

I have seen far too many strategic plans go nowhere quickly. I often mention that if you suffer from insomnia, read the first page of your organization's strategic plan and you will be asleep by the second page. Many organizations ...