Enterprise performance management. Corporate performance management. Business performance management.
We hear these words bandied about frequently, and you can’t peruse a business technology journal without encountering multiple advertisements touting performance management tools with apparently universal applications and benefits: “You need performance management, your organization needs performance management, and EVERYONE needs performance management,” they admonish.
Driven bleary-eyed by case studies and whitepapers proclaiming that performance management is your organization’s last and only hope, you feverishly agree, and pronounce that you and your organization do indeed need performance management! But before you can sign on the dotted line and acquire these amazing tools, a thought smacks against the inside of your noggin like a well-timed brick, and you shake yourself from your stupor.
“Wait a minute,” you mutter, shooing away the performance peddlers, “What the heck IS performance management, really? And how will its implementation and use REALLY affect my organization and me?”
Ah, I’m glad you asked, because we’re here to answer.
Performance: the execution or accomplishment of work, acts, feats, etc.; a particular action, deed, or proceeding.
Management: the act or manner of managing; handling, direction, or control; skill in managing; executive ability.
Let’s combine these definitions and define performance management like this:
Performance Management: The act or manner of managing, handling, directing, and controlling the execution or accomplishment of work, acts, or feats; skill in managing a particular action, deed, or proceeding.
That still sounds kind of vague, doesn’t it? It sounds like performance management is just, well, managing the performance of a particular entity to ensure that goals are met effectively and efficiently. And isn’t that what general business management has always strived toward? What is it about today’s environment that makes so many people talk about corporate performance management and enterprise performance management as if it is a new thing? And what does it mean to YOU?
While the ideas behind performance management have been around for a while, the technologies enabling it to become a sophisticated discipline are relatively new. In the 1970s, the father of performance management, Dr. Aubrey Daniels, coined the phrase “performance management” to describe the application of human behavior analysis to optimize organizational performance. As years passed, the practice of performance management has grown to encompass more than managing human assets. It now extends to managing all major assets such as money and technology to set, measure, and meet goals.
Essentially, performance management is a discipline that allows an organization to align various activities with its objectives. This requires gathering, tracking, analyzing and acting upon information and data that can change multiple times throughout the day or week. This is a practice that large organizations have been exercising for some time, and smaller organizations are increasingly adopting. In recent years, technological developments have made effective performance management systems attainable for more organizations, from vast enterprises to smaller emerging enterprises, and from commercial to public sector entities.
So now that we understand the history and purpose of performance management in today’s business environment, we can now summarize performance management systems like this:
Performance management systems are designed to create value for your organization through the intelligent collection, application, and analysis of data.
They help transform slow, expensive, and disconnected performance planning and management processes into dynamic, efficient, and connected experiences, serving finance, line-of-business, and IT professionals alike.
Performance management helps to create “analytics-driven” organizations.
In future blog posts, we’ll explain more about how performance management systems can help you solve big problems, what to look for when selecting the right system for you, and what strategies you need to implement throughout your process. So stay tuned.Questions? Contact Us!