Frank Buytendijk Blog

So we need better performance management to deal with the current crisis, I argued in my previous posts, starting with better performance indicators (see my blog on the True Value Index). But we need better systems and management processes too.

Everyone still using spreadsheets for critical management processes such as planning and forecasting, and external reporting, has some serious problems. Spreadsheets may look simple and flexible when putting them together, but totally cannot deal with rapid and massive change in a coordinated manner. Spreadsheets are fine as a user interface, but bad as the basis for performance management.

The key to dealing with rapid and massive change in a coordinated manner is in a comprehensive EPM System. One of the airlines, using an EPM System, was able to replan its complete operation after 9/11 and stayed profitable that quarter, as well as the quarter after it and after it. While others were still planning when to hold an executive meeting, they had put the new plan in action already.

Management processes should be organized more like operational processes, such as order-to-cash and procure-to-pay. Tried, tested, efficient and reliable. So, after a quick run through of the design-to-decide process to set a new course, on the management level a plan-to-act process would lead to creating a new plan and taking that into action. Seamlessly integrated, the analyze-to-adust process would track progress according the plan, using the same indicators. And the record-to-report process should keep all stakeholders up to date with a single version of the truth.

Never heard of design-to-decide, plan-to-act, analyze-to-adjust and record-to-report? Check out Management Excellence: How Tomorrow’s Leaders Will Get Ahead and the Journal of Management Excellence.