Performance Improvement

% Performance Improvement  = Current (or Future) performance - Base performance / Base performance

Base Operating System

Inherent in strategic performance improvement is a measured base of operational performance consisting of key statistics collected across a base time period. These statistics or indicators are designed to best describe how well the business or operation is performing both in financial bottom line terms and in quality service delivery. Just as we go to the doctor who measures our heartrate, blood pressure, weight and some other indicators in order to track changes in our health, a corporation needs key performance indicators that measures and continuously measures its financial and operational health. This is what we refer to as a Base Operating system.

Without a Base Operating system, a company has no handle on how well they are doing or where performance improvement is necessary or possible. Without a proper Base Operting system companies resort to strategic planning based on controlling the bottom line through extensive budget planning without truly having the information of what really affects the bottom line and how to improve it while also improving quality and customer service.

Key Performance Indicators

Each business and each department inside of the business has key performance indicators. With the current onslaught of data or big data the problem is often too much information to keep track of. So how do you determine which information is the key to your measurement system and how should it be collected? Usually, this measure is described in a volume per hour and revenue per hour of labor. For example, a food service department may measure customer service as in the average waiting time from the order to the client receiving the order and the manager may measure efficiency as the number of people or place settings one waiter can handle at one time. The overall performance may be measured in terms of dollar food cost per customer, total department labor hours per customer and revenue per hour worked. These key indicators in each department and in the entire company when measured over time then allow comparison to average or best industry standards and allow for identifying areas of improvement possible.

Measuring Current Performance

System elements or pieces must be in place to continually measure performance. But these elements must first be defined and designed accurately.