Enterprise Performance Reporting System (EPRS) Software provides predictive scorecards that are integrated with the processes that created them. The benefits of this integration, as part of an Integrated Enterprise Excellence (IEE) business management system methodology, is described in a one-minute video:
Very Unhealthy Behaviors can be the Result of Traditional Scorecards and Performance Report-outs
The outputs from a system can be considered the Y’s from processes. Inputs or process steps are the X’s of this system. Mathematically this relationship is Y=f(X); i.e., Y is a function of the system’s X’s.
Leadership often sets performance goals (Y’s from a system) that are to be achieved at a particular point in time; e.g., end of next month or quarter. Management then may use traditional Balanced Scorecard Software or some other means to see how well Key Performance Indicators (KPIs) are performing at a selected point in time relative to previously established goals (which are often arbitrarily set).
This organizational management approach can be considered “management to the Y’s”. “Management to the Y’s” in an organization” can lead to very unhealthy behaviors. For one thing, people in business functions may feel that they need to “do something” to make the numbers appear better for them or their organization, which can often lead to playing games with the numbers. For example, to meet financial goals for a month or quarter, future orders may be pulled into a current time period to improve the numbers; i.e., robbing Peter to pay Paul.
A Dr. Lloyd S. Nelson quote in Edwards Deming book Out of the Crisis (1986) was: “If you can improve productivity, or sales, or quality, or anything else, by (e.g.,) five percent next year without a rational plan for improvement, then why were you not doing it last year?”
To address the point that Nelson was highlighting, one must give focus to the X’s in a system and what can be done to improve them so that the big picture benefits. When this is done through a rational plan from improvement, results will be seen in the system’s Y’s.
The following graphic includes four actual performance scorecard outputs for an organization. When asked in workshops what one might do relative to each of these four scorecard outputs, invariably the response is that the reporting is too confusing to make any sense. The comment is also made by workshop attendees that they have similar metric report-outs in their organization. Perhaps organizations often have a traditional-scorecard-reporting-methodology-elephant-in-the-room relative that no one is talking about.
The weakness in standard scorecard and dashboard solutions is that the performance metric displays only allow the most simple and common charting (bar charts, pie charts, and time series charts like one could see in Excel). Enterprise Resource Planning (ERP) systems are optimized for the input and output of data, not for statistical analysis or statistical charting. Traditional scorecard report-outs are not viewing the system from a Y=f(X) point of view!
The IEE system with EPRS software addresses these traditional Y=f(X) issues that are prevalent in traditional scorecards — and more!
Enterprise Performance Reporting System Software within the Integrated Enterprise Excellence Business Management System
An IEE value chain describes what an organization does and how it measures what is done. The Y=f(X) of an organization is basically described in an organizational value chain.
A pictorial representation for an organizational value chain is:
EPRS software provides clickable drill down access through the IEE value chain to what is done in an organization (i.e., its processes) via the rectangular boxes. The main functions of an organization are described by the rectangular boxes that are connected by arrows. Support functions are represented as boxes that are not connected by arrows.
Performance metrics are accessed by clicking oblong boxes. The EPRS software reports metrics from a process-output point of view. When a process is stable, a futuristic statement about its performance can be made. The predictive performance metric reporting techniques within the IEE system are called the 30,000-foot-level performance reporting. To illustrate how measurements that are important to customers can be included in an IEE value chain, performance metrics believed important to receivers of produced products/services are highlighted in yellow.
How to Determine where to Focus Improvement Efforts so the Big Picture Benefits?
Often organizations dedicate resources for making improvements; however, often these efforts are in silos. Businesses benefit when their focus is altered from silo thinking to a big-picture systems thinking focus.
What is needed is a methodology that removes obstacles for enhancing the Y’s in a business.
The 9-step IEE system addresses these business management system scorecard and big-picture improvement needs. Step 2 of this system includes the IEE value chain, which integrates operational (30,000-foot-level) and financial (satellite-level) metrics with their processes.
In the following Enterprise Improvement Plan (EIP), steps 4, 5, 6, and 7 of the 9-step IEE system are shown at the top figure. IEE Steps 6 addresses the determination of 30,000-foot-level metrics that are to be improved via process enhancement efforts (step 7) so the enterprise as a whole benefits.
IEE provides the structure for managing and improving organizational X’s so the big-picture benefits. The IEE system provides a structure for addressing Dr. Nelson’s earlier statement relative to traditional scorecard reporting and goal setting.
Enterprise Performance Reporting System Software Benefit: Its Leverage
The EPRS software leverages the power of Minitab® software to provide the analytical and graphical power needed in an effective scorecard. Using a series of specially coded Minitab® macros, the EPRS software will acquire data from an ERP system, corporate database, or excel files and generate 30,000-foot-level performance reports that are available for viewing with a web browser. The generation of each performance metric scorecard is automated in order to reduce the labor required to maintain up-to-date scorecards available in an organization’s network.
Performance reporting software, like the EPRS, is a tool that provides reports to the workforce and leadership. The selection of the performance metrics to be reported and how they are reported are also a very important requirements of creating an effective IEE business management system. The EPRS software has been created to be flexible in its ability to group and report subsets of performance metrics.
Following the Integrated Enterprise Excellence (IEE) system methods, created by Forrest Breyfogle, will lead an organization through a good process to identify the best performance metrics. The EPRS system allows the adoption of a value chain diagram (graphical interface) for grouping metrics based on their significance within the organization. This allows the creation of specialized scorecards based on the organizational demographics, such as manager, product line, location, or division/department within the organization.
Additional Information about Enterprise Performance Reporting System Software and IEE Business Management System
How to implement the above-described IEE system is described in our 5-book series:
For additional information about EPRS software, see:
- Enterprise Performance Reporting System Software Scorecard
- Enterprise Performance Reporting System Software Tour
- Enterprise Performance Reporting System Software Features
- Enterprise Performance Reporting System Software Specifications
- Enterprise Performance Reporting System Software Next Steps
Do you want to read more about using the EPRS to report performance metrics? Click here to download “Performance Reporting Using the 30,000-Foot-Level Method”
Would you like to read about the characteristics of a good performance metric? Click here to download “Good” Performance Metric Identification.
Contact Us to set up a time to discuss with Forrest Breyfogle how your organization might gain much from an Integrated Enterprise Excellence (IEE) Business Process Management System and its Enterprise Performance Reporting System Software Benefits.