Using performance management tools at strategic level is like piloting an airplane, with all the main buttons showing different indications. Connecting and managing the knowledge of using the indicator buttons as instruments, allows the pilot to be in command of the airplane.
Some of the most important performance management tools implemented in the organisation at strategic level are:
Performance Scorecards represent repositories with Key Performance Indicators that allow visualization and analysis of strategic information. It displays periodic snapshots of performance associated with an organization’s strategic objectives and plans, indicating deviations and warnings to the managers.
Tableau de Bord
Represents a management system comprised of a set of indicators and the processes of their selection, documentation and interpretation. The overall perspective offered by all indicators measures the status of the business and the system model to be managed in order to achieve its objectives.
Key Performance Indicators (KPIs) are instruments used in performance management that monitor the performance of key result areas of business activities, which are absolutely critical to the success and growth of the business. The development and use of the KPIs should form the basis for the analysis of an organization’s current performance, its future requirements and the improving strategies required for ongoing success.
Performance evaluation / review / appraisal
Performance evaluations are strategic performance management instruments implemented with the purpose of assessing and measuring performance reached, in well defined frameworks, such as quarterly or annual reviews.
Strategy maps are tools usually used in implementing a system based on Balanced Scorecard. This instrument illustrates through a cause-and-effect relationship, a snapshot of the entire organisational strategy. When used in the context of Balanced Scorecard implementation, strategy maps present strategic objectives / critical success factors on four perspectives (financial, customers, processes, learning & growth), with a logical linkage among them.
Desired State in Evolution
This is an instrument that shows the desired state of the organisation's evolution, a snapshot of where it wants to be in an agreed period, from different perspectives: strategic objectives and goals achieved, internal capabilities and processes, organisational culture, structure and employees.
Vision statements are one of the most important strategic management and business performance management tools. They represent a much needed mental image of the future state, inspiring and motivating leaders and followers towards a common desideratum. In doing this, they facilitate alignment and decision making. While they vary in format and usage, vision statements generally represent a good balance between the efforts invested in development and the impact their usage has on results (smartKPIs.com, 2010).
Mission statements are an important strategic management and business performance management tool, helping with grounding organisations by clarifying their purpose or reason to exist and framing the context of their operations. One of the most comprehensive reviews of the topic by Stallworth Williams (2008) sustains that despite the challenges in the formulation and use of mission statements, they shouldn’t be considered fads, as they withstood the test of time and continue to matter (smartKPIs.com, 2010).
- smartKPIs.com (2010), Mission statements as strategic management tools – A brief history, available at: http://www.smartkpis.com/blog/2010/06/26/mission-statements-as-strategic-management-tools-%E2%80%93-a-brief-history/ (accessed 16 August 2010).
- smartKPIs.com (2010), Vision statements as strategic management tools – Historical overview, available at: http://www.smartkpis.com/blog/2010/07/03/vision-statements-as-strategic-management-tools-%E2%80%93-historical-overview/ (accessed 16 August 2010).
- Stallworth, W., L. (2008), The Mission Statement – A Corporate Reporting Tool With a Past, Present, Future, Journal of Business Communication, Vol. 45, No. 2, pp. 94-119.