It is precisely because of this practical role that performance management has been widely discussed and applied by enterprises in China in recent years. However, the implementation effect of performance management is mostly unsatisfactory, either giving up halfway or becoming a mere formality, and some even undermine the stability of the organization itself and play the opposite role.
In view of this, the author gives his own unique views on how to build an effective performance management information system with specific examples, and points out the mistakes that enterprises often make in building performance management systems.
Break the balance between information system and process
The performance management of enterprises depends on effective process management and auxiliary systems. Therefore, an appropriate process should be reasonable, cost-effective, flexible and transparent. In addition, technological processes related to processes should not only support business processes, but also improve their operational efficiency. When designing and implementing a performance management scheme, it is most important for managers not only to master the company's business processes and information systems, but also to deeply understand the relationship between them.
The performance management (BPM) process of an enterprise can be described by a set of functions. Usually, the performance management of enterprises is related to strategic objectives, and enterprises hope to effectively motivate employees through performance management to promote the realization of management objectives. In the actual management of an enterprise, if it cannot be measured, it cannot be managed. To achieve effective performance management, we must first design measurable indicators. The long-term strategic objectives of enterprises are usually described by some special target combinations and key control indicators. These key indicators can be embodied in the management and operation of enterprises through organizational structure design, and must be linked with the incentive system of enterprises.
However, performance management is often easier said than done. The performance management of many enterprises is doomed to failure from the beginning. They mistakenly believe that as long as the performance management information system is established, they can rest easy. In fact, a single system will not play any role. The complex performance management information system itself is a challenge for enterprises. Once an enterprise equates performance management with performance management information system, it will find itself in a rugged mountain, even with the best BPM diagram. If an enterprise can't clearly understand its current process, it can't talk about designing future processes, let alone expecting the support and promotion of performance management information system to new processes.
Document existing processes
It is usually a boring job to sort out the existing process, which may be one of the reasons why it has not been valued by enterprises. However, Sarbanes-Oxley Act (promulgated in 2002) is an American anti-commercial fraud act, which requires organizations to use documented financial policies and processes to improve auditability and generate financial reports more quickly. Section 404 came into effect in mid-2004, and many companies were forced to re-examine the old operation flow chart.
The problem is that these processes cannot be accurately analyzed. Many companies have a documented management process, but this process will make financial experts have different views on the company's current documentation process. This often leads to the inconsistency between what is required by the outside world and what actually exists. Some charts ignore some important procedures, systems or other special situations. If we rely on such charts, it will inevitably delay the progress of BPM projects or lead to system defects, or even both.
Of course, for enterprises, it is generally not to completely deny the existing process, but to design a new process to achieve their ideal situation. This can also be reflected from BPM product providers, who often describe themselves as providers of "performance management solutions". If these schemes are designed correctly and can be implemented well, they will bring great value to enterprises, but enterprises should understand that no BPM system can do everything. Enterprises must find their actual needs on the basis of a clear understanding of their own processes. If you can't clearly understand your own process and blindly pursue BPM system, it will not only bring disaster to the existing system, but also lead to major defects in the design of the new system, which will eventually lead enterprises to choose a system that is not suitable for them or spend a lot of money to buy back a suitable system.
From a specific process involving BPM, we can see the importance of the original process: enterprise financial reporting process, that is, the process of collecting, reporting and analyzing enterprise financial information and other operational information. This process consists of some important data streams: the record of the original source of data, the classification of data, and the ETL of data (that is, the extraction, transformation, storage and application of data). If you can't do the above process, the new system is in danger of being oversimplified. In addition, temporary and one-time information requirements and coordination should also be included in the flow chart.
How to determine the target process
Without a good understanding of the existing process, it is difficult to design a new process. It's like, if you don't know where you are, you don't know why you walked from here to there. More importantly, if we don't know the cost source of the existing process, we can't accurately estimate the return on investment of process reengineering and integration, which includes the cost of technical solutions, consulting services and internal efforts.
To determine the target process, we must first understand how technology makes the new process more effective. Nowadays, many BPM software and toolkits are very easy to obtain. However, what kind of process and technology to adopt depends on whether the software can effectively integrate the existing process and the original related infrastructure. The security and reliability of systems and data related to BPM must be considered.
Thirdly, taking the financial reporting system as an example, Sarbanes-Oxley Act stipulates the length of the financial cycle of an enterprise. But as the military training said, "it will be very dangerous to equate your expectations with your abilities." If the enterprise uses manpower to coordinate data flow, or the infrastructure and structure of the enterprise do not support highly centralized data processing, it is difficult for the enterprise to shorten the financial cycle through the network.
Design of BPM system
How to choose and design a new performance management system after determining the target process? Enterprises must break the balance between existing processes and systems. Of course, effective performance management is mainly about processes, but to design new processes to support the system with new technologies, all previous successes must be broken.
Usually, the choice of system and technology for designing a new system must start with the difficulties you face. For example, if the problem lies in the process itself, then it is necessary to find out where the problem lies and why it appears there. If the problem is related to the system, don't think that a new system can easily solve the problem. The new process will only play an effective role if it meets the special needs and matches the process well. If the system and process are not well combined, it will only make the problem worse. Enterprises can't just see the appearance of the problem, but must find out the root of the problem.
Going back to the financial report management system mentioned above, even if a new solution is adopted, it may not be able to solve the problem of long financial cycle. On the contrary, using multiple reporting systems instead of highly centralized financial systems may shorten the financial cycle of enterprises. At this time, enterprises will complain about the system problems and ignore the real reasons. The real reason may exist in the operation process, not after the information reaches the central processing, or the financial manager only uses his own system without making full use of the enterprise's information management system. These two problems cannot be solved by using new performance management tools or management software.
In recent years, performance management solutions have achieved great success. Many solution providers have also made great progress, such as Hyperion Solutions, Congnos and other companies have greatly expanded their product lines to meet the needs of various BPM systems. But for enterprises, strategy determines the process, and your actual process will determine the system you need. The most important thing to invest in BPM system is to know your existing process, and know the advantages and disadvantages of the technologies and solutions you can obtain.
The significance of a successful performance management system should be to enable all employees of the enterprise to reach the company's expected goals and work standards. For employees with good performance, let them have more room for development in order to pursue better performance or maintain current performance; For employees whose performance fails to meet the expected standards, the supervisor will interview the employees, and * * * will jointly formulate improvement plans and measures to enable the employees to reach the performance standards as soon as possible. Successful performance management information system is based on improving enterprise performance.