Why performance management is failing to deliver

If delivering Performance Management applications was as simple as buying the software product and installing it, then everyone would be driving increased business value from operational data. Sadly it’s not, they are not.

The promise of Performance Management is an integrated and unified view of data across the organisation, automated and aggregated to meet the requirements of users, enabling operational excellence and delivering competitive advantage. Yet despite proven software and clear business benefit Performance Management is still in the “Early Adopter” phase within industry. So why are organisations investing in quick win solutions such as Planning, Budgeting and Forecasting applications, and risking operational effectiveness, rather than unifying these silos of information and mining their combined value?

The simple answer; “Cost, Value, Risk”. The investment required to deliver a Performance Management project is proportional to organisation size and thus unilaterally high. Effective project “Due Diligence” to reconcile a business requirement and an IT solution becomes intractable when project governance, project scope, operational engagement between the business & IT, process improvement, user adoption, data integration and data quality are all combined. The potential pitfalls mean an in-house solution carries too high a risk, and outsourcing carries too great a cost.

So how should organisations reconcile these difficulties and deliver successful projects? Firstly the software used should form around 25% of the project consideration, as such its selection should be based on requirements set out in a project roadmap, rather than a product predisposition.

Secondly Performance Management is a “Business Solution to a Business Problem”, and should be business-led, sponsored and governed. A thorough “Discover & Reveal” phase should set out challenges, solution, and benefits, against which project scope can be controlled. ROI modeling should ascertain the suitable balance between investment and benefit. A pilot model or phased approach mitigates the risk of biting off more than you can chew.

Engaging with a third party will also help leverage benefits and decrease Time to delivery, through ROI modeling expenditure can be justified and rationalised. Their industry expertise and subject based knowledge, along with value-added software, pre-developed solutions and integration platforms can mitigate risk, optimise ROI and bring unanticipated benefits.

To win in the current economic climate we all need to become “Data Driven Businesses”, effective at aligning “Strategic Goals and Process Improvement” by integrating“Thinking & Doing”. If these ideas resonate with your business experience, then visualmetrics is a viable business partner for your next Performance Management project.