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Use Information to Focus Resources |
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Use data to plan overwhelming advantages. |
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Robert Nardelli, president of General Electric's power systems unit, asked his top 100 customers about their most critical needs and how GE could provide solutions. The answers prompted the company to drastically reduce its response time for providing parts. It also opened the opportunity to advise utilities on the nuances of expanding into foreign markets that were new to them but not to GE.
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At Ford's monthly strategy meetings, data is reviewed on the profitability and growth potential of Ford's broad line of car and truck models. This information on the customer's preferences is used to rapidly and surgically eliminate products that are no longer in demand. |
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When the Arizona Republic learned that readers didn't have time or patience to wade through long features, it added boxes summarizing the content. When subscribers to the Long Island Newsday complained they weren't getting their papers early enough, the operation was reengineered to provide 5:30 a.m. delivery.5 |
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In each of these examples, data links the customer's preferences to performance. Customer input is a vital component of an organization-wide performance measurement system. |
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Organizations that have added only customer input to their historic financial measurement system have not completed their system. Although the customer input adds another dimension, the financial measure only serves to keep score on what has happened. |
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The solution is to focus on defining and aligning performance in several key areas: financial, customer, employee, process, innovation, and learning. With achievement of the corporate strategy as the main objective, supportive objectives are established for each key performance area at every level of the organization. Then, a measurement system to track performance is cascaded so that everyone is aligned to achieve the desired results. This cascading measurement system, often called a balanced or synchronized scorecard, encourages the kind of performance that achieves results in areas critical to success. |
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