In order to succeed, a financial institution must embrace the need to change and use the tools provided to generate strong management accountability across the whole organisation. Results should affect rewards and managers must be empowered to achieve the results. Targets must be linked to the strategy and senior staff must demonstrate the culture in practice.
The balanced business scorecard demonstrates the fundamental change in management techniques that has been taking place in recent years. It requires the involvement of the managers with the vision of the organisation and its strategies and looks at the whole organisation - not just the financial perspective so loved by analysts and investors alike.
A balanced scorecard should facilitate strategic monitoring and control, as well as influence behaviour and motivate managers towards corporate objectives. It will provide information to assist the overall management of the organisation by linking all the processes in the value chain to provide an integrated picture of the performance of the organisation in relation to the vision.
It complements the traditional financial measures with operational measures on customer satisfaction, internal processes and the innovation and improvement activities that precede performance improvements. Not all information necessary to monitor performance can be provided internally and some must be provided externally (such as market share), or through internal and external surveys of customer perceptions and staff attitudes.
Performance management uses the full range of internal and external measures to motivate staff at all levels to demonstrate behaviour that will help the organisation to achieve its strategy. We can help you to review and enhance your existing performance management systems.