PERFORMANCE MEASUREMENT

Performance measure selection

Performance measures are a critical tool that companies use to assess past performance, as well as identify emerging trends to improve the quality of ongoing decision-making.

Vivient helps clients choose meaningful measures that are aligned with business strategy, goals and company culture. The measures are identified through rigorous quantitative analysis, as well as a qualitative assessment of your strategy, culture and organization. 

Vivient helps clients think through important performance measurement considerations, including: 

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• To what extent should measures be identified for different levels within the organization (e.g., corporate, unit/department, team and individual levels)?

• What is the right mix of financial and non-financial performance measures?

• What is the appropriate level of performance-measure complexity for your organization?

• To what extent should performance measures be customized to enhance accuracy, provide the right incentives and minimize accounting distortions?

• How should performance measures be linked to variable compensation?

• Over what time horizon should performance be measured?

We have considerable experience helping companies implement value-based performance measures, such as economic profit (EP).  We work with management to tailor the value-based measure to your organization and set meaningful targets.  We also support implementation efforts with customized training and communication.

Performance scorecard design and implementation

Performance scorecards, such as the Balanced Scorecard, translate company strategy into a set of financial and non-financial goals and measures that provide a company's "vital signs."  By incorporating both leading and lagging indicators of performance, scorecards enable companies to assess past performance, as well as make mid-course corrections toward the achievement of future goals.  Vivient helps its clients develop scorecards that drive company strategy and provide the management team with a useful tool for tracking company progress toward the achievement of goals.  Vivient also supports scorecard implementation efforts by providing customized communications materials and training.  

Target-setting

Vivient believes that performance targets should be based on information from a variety of sources – not just the annual budget. Vivient’s approach to target-setting involves building a client-specific fact base that includes company financial goals, market and shareholder expectations, budgets and multi-year plans, past company performance, competitor performance and strategic objectives. We assimilate the information from different sources and work with the client to finalize meaningful targets. Our approach results in targets that are aggressive yet achievable.