Volume No. 63

Enterprise Performance Management – Getting Past the "Buzz"

Since I started writing about Enterprise Performance Management (EPM) a little over 10 years ago, we sought to escape the "flash in the pan" buzz of the next big "management THING." Our readers and clients had appeared to embrace EPM for what it was – the cornerstone of what the enterprise should be built upon . . . the foundation of a business . . . much like that of the Balanced Scorecard, taken to its logical end state.

That is until I opened the latest BI rag (whose name I will not mention because, after all, I do like writing for them :) ) and saw two new articles that essentially spoke about EPM synonymously with the plethora of scorecard and dashboard APPLICATIONS espoused by the likes of SAP, Oracle, and even some "bolt-on" solutions of the BI "boutiques."

OK – let's straighten this out once and for all – EPM is NOT an application, it is a business PROCESS. Not only is it A business process, it is (or should be) THE central business process of the enterprise. Sure, they are connected, but here's the real acid test. If you are an implementer of these systems or tools, ask yourself how much time you spent (or intend to spend) on the following activities as you implemented your so called EPM software:

1.   Affirming your strategy, and translating it into something your front line employees can easily understand.

2.   Refining your objectives and aligning your management team to them.

3.   Translating your key objectives into measureable and benchmarkable KPI's.

4.   Doing the requisite analysis (benchmaking, trending, analyzing, forecasting) targets for each of these KPI's.

5.   Linking your key initiatives to the KPI's they are designed to improve, and prioritizing (and de-prioritizing) them according to these linkages.

6.   Defining ownership and individual accountability for each KPI.

7.   Defining the reports and analysis needed by these individuals and workgroups to enable them to be successful.

8.   Linking appraisals and reward systems to the achievement of KPI's and business metrics.

9.   Defining and mapping the process required to MANAGE KPI achievement.

10. Training management and supervisors in the EPM PROCESS.

11. Shaping and reshaping culture by "walking the walk," and surrounding the EPM process with the required investments in change management (the people side of change).

12. Defining the best technology solution to enable all of the above.

13. Selecting and designing the technology solution.

14. Implementing said technology.

If the time, energy and resources you spend on #13 and #14 is more that 1/3 the resources spent on #'s 1-12, you've got a very "unbalanced" EPM solution in the works. Getting the EPM system to the point of real value add requires that degree of "footwork," and if your're not yet ready to make that investment, please don't waste your IT dollar.

While some linguistics experts may not agree with me technically, EPM is not a "thing," but a process – not a noun but an active VERB. It needs to be spoken about, and treated as one. Part of changing the culture is first recognizing when the above is not the case, and taking an active role in calling that out when you see it (or READ it!!!)

Author: Bob Champagne is a Vice President of Performance Management Solutions with UMS Group, Inc., a privately held international management consulting organization specializing in Performance Management tools, systems, and solutions. Included in UMS Group's product portfolio are a wide variety of performance tracking, reporting, and benchmarking solutions, as well as customized performance assessments and diagnostic services. UMS Group has consulted with hundreds of companies across numerous industries and geographies. Visit UMS Group at http://www.umsgroup.com or contact us directly at 973-335-3555.