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Enterprise Performance Management: The Australian State of The Art
Enterprise Performance Management: The Australian State of The Art
Enterprise Performance Management: The Australian State of The Art
Executive Summary
The field of enterprise performance management continues to grow exponentially. New
key performance indicators (KPIs) routinely emerge and are said to provide new
performance insights and a panacea to the problems of aligning behaviours with key
business drivers. Somewhat paradoxically, global research indicates a level of inertia in
enterprise performance management systems. While the problems of financial
measures are well known, evidence indicates their dominance in organisational
decision-making. Concurrently, more nonfinancial KPIs are being used, but their
proliferation is also their weakness, with executives left wondering which ones to focus
on and how they influence financial performance. As a result, many organisations
extract an insufficient return on measurement from their enterprise performance
management systems.
In Australia, there has been a dearth of evidence on practices in the field of enterprise
performance management. This report presents evidence on the state of the art in
Australian enterprise performance management. It is one part of a broader global study
across five countries: the United Kingdom, United States of America, Australia, Japan,
and China. The Australian study was led in Australia by Macquarie Graduate School of
Management and was conducted in conjunction with Oracle and Cranfield School of
Management.
Main Conclusions
Detailed Findings
70
% of respondents
60
50
40
30
20
10
0
Balanced
scorecard
Six
sigma
EFQM
Other
% reporting use
70
60
50
40
30
20
10
0
45
45
40
40
35
35
% of respondents
% of respondents
50
30
25
20
15
30
25
20
15
10
10
0
Strongly
disagree
Disagree
Neither
agree nor
disagree
Agree
Strongly
agree
Strongly
disagree
Disagree
Neither
agree nor
disagree
Agree
Strongly
agree
40
35
30
% of respondents
20
15
10
5
0
None
1 - 24%
25 - 49%
50 - 74%
75 - 99%
All
50
Operational decisions
% of respondents
40
30
20
10
0
Strongly
disagree
Disagree
Neither
agree nor
disagree
Agree
Strongly
agree
25
50
40
30
20
10
0
Strongly
disagree
Disagree
Neither
agree nor
disagree
Agree
Strongly
agree
70
% of respondents
60
Compensation/Rewarding
Strategic Decision Making
50
Financial Control
Strategic Planning
40
External Reporting
30
Validating Strategy
20
10
0
Primary reason for measurement
Assessing Outputs
Controlling Inputs
70
Controlling Behaviours
% of respondents
60
50
40
30
20
10
0
Strongly
disagree
Disagree
Neither
agree nor
disagree
Agree
Strongly
agree
90
% of respondents
80
70
60
50
40
30
20
10
0
% of respondents
Internal
benchmarking
External
benchmarking
Internal &
external
benchmarking
% of respondents
40
35
30
25
20
15
10
5
0
Strongly
disagree
Neither
agree nor
disagree
Agree
Strongly
agree
Disagree
Neither
agree nor
disagree
Agree
Strongly
agree
% of respondents
50
40
30
20
10
0
Strongly
disagree
Disagree
Neither
agree nor
disagree
Agree
Strongly
agree
% of respondents
Disagree
% of respondents
30
25
20
15
10
5
0
Strongly
disagree
Disagree
Neither
agree nor
disagree
Agree
Strongly
agree
% of respondents
60
50
40
30
20
10
0
None
Spreadsheet
ERP
software
Customised
software
EPM
software
% of respondents
60
50
40
30
20
10
0
In-house
Consultant-led
Collaborative
% of respondents
40
30
20
10
0
Indicators not
structured
Indicators
structured
Indicators linked
to strategic
objectives
Indicators linked
in cause effect
diagrams
50
45
40
% of respondents
35
30
25
20
15
10
0
None
Between
perspectives
Between
strategic objectives
Between
performance measures
% of respondents
20
15
10
5
0
Strongly
disagree
Disagree
Neither
agree nor
disagree
Agree
Strongly
agree
Complete
Partial
Incomplete
10
What to Do?
What should organisations do in response to the six challenges
outlined in this report?
11
25%
32%
28%
15%
100M - 250M
250M - 500M
500M - 1B
1B - 5B
10
% of respondents
15
20