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Measuring results
Chapter VII

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 Learning Competencies
a. To acquire a working knowledge on how to
evaluate their business, and how it is
progressing toward its goal.
b. To learn the whats, whys, and hows of
evaluating performance of the organization as a
whole and at the group and individual worker
level.
 COntrolling

“M” in the GEMS process stands for Measuring

Results.
- it allows the manager to detect deviations
from the plan in time to take corrective action.
This process compares actual activities with the
planned activities, actual results versus planned
results.
 Measuring results
Quantitative QUALITATIVE
measures MEASURES

This type of data

Quantitative
is collected
methods
VS through
emphasize
methods of
objective
observations.
measurements.
 Measuring results
Quantitative aspect

In the retailing business, it refers to the

increase or decrease of shoppers, as
well as how fast products are moving
out of the shelves.
 Measuring results
Qualitative aspect

It basically refers to customer satisfaction, thus

customer service is the primary interest.

Consumer complaints and feedback through

survey forms will help find out which specific part
of the service needs improvement.
 Balanced performance measures

As advocates of strategy management, Kaplan and

Norton recommend that we must do a fast but
comprehensive view of the business from our
perspectives:
 Balanced performance measures

o Customer Perspective – How do customer see us?

o Internal Organization (Process) Perspective –
What must we excel at?
o Innovation and Learning (People) Perspective –
Can we continue to improve and create value?
o Financial (Shareholder) Perspective – How do we
look to the shareholders (owners) ?
 Balanced Results

Management author, D. Ulrich expands the

strategy management concept of Kaplan
and Norton by defining results as follows:
 Balanced performance measures

o Achieving “Customer” results – refers

to “customer value” or benefits to
customers.
o Achieving “Organization” (Process)
results – focuses on structure or systems
and core competencies (technology).
 Balanced performance measures

o Achieving “People” results – considers

people as “human capital” where the Business
Manager must develop and invest to increase
employee capability.

o Achieving “Shareholder” (Owner) results-

is meeting the expectations of shareholders
and investors.
 Departmental Performance
Evaluation
 Measuring results must lead to performance evaluation
which should be linked to goal and executing plans.
 Managers will need to cascade the entire management
process from the top to the middle and lower levels of
management in the organization.
 Departmental Performance
Evaluation
 The process of measuring results and performance
evaluation should be cascaded down to the
departmental/unit level.
 Each department/unit head must determine their respective
performance by reviewing how they did in each of their
KRAs/KPIs in relation to: customer results, process results,
people results, and financial results.
 Individual performance evaluation

 The company’s overall success measures must

be translated to department/unit measures and
subsequently to individual performance
measures.

 The KRA/KPI approach may be employed to

key individual workers in the organization.
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