Designing a Performance Measurement Systemperformance measurement system

Abstract

The present chapter discusses a core problem of quality management for organizations: establishing and maintaining a performance measurement system. Flowing from the mission and strategic planning of one organization, a performance measurement system is supposed to include the data to collect, analyze, report and, finally, use to make sound business decisions. The remainder of this chapter is divided into eight sections. Sections 5.1 and 5.2 present the basic characteristics of an integrated performance measurement system. Section 5.3 discusses some popular approaches to develop performance measurement systemsperformance measurement systemdevelopment: the Balanced ScorecardBalanced Scorecard, the Critical FewCritical Few, the Performance Dashboards, and the EFQMEuropean Foundation for Quality Management (EFQM) model. Description is supported by the use of practical examples. Sections 5.4, 5.5 and 5.6 discuss how to develop/synthesise indicators and maintain an effective performance measurement systemperformance measurement systemmaintaining. Sections 5.7 and 5.8 deal with the possible misuse of indicators and their impactimpact on organizations.