Many people believe that driving down durations of business processes is an improvement in itself. I.e. if it takes only three (3) days it is better than it takes five (5) days.
- It is alluring because it looks so intuitive and simple.
- It is possible to measure it.
- It is impossible to measure process durations in free cash of profitability. Or?
In such situations people tend to take the path of least resistance. Repeatedly throughout the history of performance management.
Though everybody knows as well:
“1. Performance indicators that measure activity rather than performance will provide less useful data and information overload”
Actually there is common sense about what it takes to make an effective performance indicator:
We have figured how to measure operational activities in free cash or profitability. Hence Trufa performance indicators:
can be linked to objectives (enterprise efficiency or effectiveness)
are actionable (because drivers are clearly identified)
are simple (it’s either cash or profit)
are credible (it can be looked up in the P&L or in the balance sheet)
are integrated (financial outcome can be translated into operational measures)
are measurable (that’s what Trufa is all about).
Do you want to take us up on this?