E P REnterprise Performance Reporting

A Fundamentally Better Way to do Business TM

The need for up-to-date information on the financial and non-financial performance continues to increase.  Accounting departments are expected to close the books in shorter time frames. Working faster or even smarter is no longer enough. 

Management and owners are expected to manage the business to the benefit of different, often conflicting, stakeholders.

Performance Reporting

Why Measure Performance?

Strategic Alignment of Objectives

Clear Responsibilities and Objectives

Effective Control

Optimized Resource Allocation

Anticipation of Trends

Problems with Most Measurement Systems Too much data that no one uses

Lack of relevant detail

Measures that drive the wrong performance and discourage teamwork

Incongruent goals across the organization

The Keys to Effective Measurement Less is More (K.I.S.S.)

Linkage to Vision, Values and Key Success Factors

Data must be available, consistent, complete, timely and reliable

Metrics should flow down to all levels

Metrics must be manageable

Measuring Financial Performance Financial reports must contain the data that managers

need to manage

Financial reports are useless if they aren’t read or acted upon

Timing is of the essence

Incorporating non-financial measures Link to long-term organizational strategies

Identify drivers of success

Better indicators of future financial performance

Non-financial measures are less susceptible to external noise

Need to understand causal links

Non Financial Measures Customer Satisfaction Quality Process Performance Supplier Performance Employee Satisfaction

EPR Enterprise Performance Reporting is:

A unified view of the organization Top-down in concept / Bottom-up in achievement Cost-Effective Focused on the fundamentals Incrementally implementable

EPR Achieves:

Lower operating costs Higher profitability Working together towards common goals Focus on goals and growth Everyone knows where the company is going Match between Accountability and responsibility

EPR Implemention

Select the Right Measurements Link to vision and strategy Establish Goals Translate Measurement into Action Communicate Performance

Selecting the Right Measurements Start with the Vision and Strategy

Categorize into Groups or Perspectives

Define objectives

Define meaningful metrics that will help to measure the performance against objectives

Understand Cause and Effect

Linking to Vision and Strategy Vision and Mission Statements should change the way a

company works

Define goals from the strategy

Define performance measures to understand performance against goals

Be careful of deceiving measures

Business Goals

Goals should include a measure

Avoid short-term goals inconsistent with strategy

Avoid inconsistent goals at different levels

Data Acquisition

Data must be accurate

It must be timely

It must be consistent

It must be cost-effectively collected

Using Performance Measures Effectively

Accountability must link to performance measures

Regularly review and analyze the measures

Use metrics for more than just keeping score

Communicate performance information

Establish priorities

Avoid the Pitfalls Keeping results at the top

Development process too long

Treating EPR as an IT project

Using EPR only for compensation

Conclusions Start with the Vision and Strategy to develop a balanced set of

relevant metrics and dimensions

Base business performance measurement on a unified view of the organization

Think Information, not Data

Select an application that will facilitate analysis, & promote communication

Follow measurement with action

EPR Enterprise Performance Reporting

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