Businesses are always seeking ways to improve their performance and operational capabilities while also trying to minimize the expenses and resource consumption and getting themselves ready to respond to a disruption or unprecedented situation. The only solution to that challenge is to improve the performance of the entire enterprise including both the human and non-human resources and keep a close eye on the performance all across the entire enterprise.In order to improve the performance a business needs to identify the hurdles and obstacles that are causing reduction in performance and poor resource management. For that businesses rely on Enterprise Performance Management or EPM which is a process and mechanism to closely monitor the performance of the entire organization and then identify the obstacles, challenges, problems and barriers which are preventing the business to achieve the higher performance and higher efficiency.
The enterprise performance management or EPM process is a very complex and sophisticated process which requires a robust framework and rapid data analysis that is why a dedicated Enterprise Performance Management Software is used to aid the performance management process. The enterprise performance management process enables the management to take timely actions and respond to a disruption in a rightful manner with agility. This help businesses to achieve their goals and objectives.
Introduction to Enterprise Performance Management (EPM)
The Enterprise Performance Management is not a modern day phenomenon, in fact even before adopting to computers and IT the enterprises and organizations were doing performance management via discussions, meetings, surveys, calls, etc. With the passage of time especially in past two decades the Enterprise Performance Management (EPM) software have evolved from a basic desktop application to a highly powerful framework with internet access and online connectivity. Here in Dubai and all around the UAE most of the time businesses often confuse the Enterprise Performance Management (EPM) with the Enterprise Resource Planning (ERP) solutions because most of the modern ERP systems comes with in-built data analytical and reporting modules that can provide some very basic features of the performance management. However, in order to outperform your competition and be ready to respond effectively and efficiently to internal and external disruptions, a dedicated Enterprise Performance Management (EPM) solution is absolutely necessary.
The world in general and the UAE in particular has become a very vibrant and dynamic business landscape these days. That is why a business needs a very flexible strategic approach and planning to achieve their goals and to effectively handle the disruptions. The disruption could be an internal factor such as a poor performing employee, a team member left in the middle of a project, lack of communication, any other problem that can slow the progress, or the disruption could be an external factor such as some products/services went viral, some flops, a competitor replaced your most valued product/service share in the market and so on. Such disruptions can deviate the business from its course which it sets to achieve its high-level goals and objectives. An enterprise performance management system not only keep a track on on-going progress but it also provide accurate projections and gather valuable data in real-time which increase the readiness of the management and enables them to make quick and informed decision.
Enterprise Performance Management (EPM) Offers Great Business Value
The measure of success of every business is the measurement of their progress towards their goals and objectives. Each successful business knows that very well that there are two major challenges that a business face during their journey to success. First is the disruption and the second is difficulties in aligning the human and non-human resource with their high-level organizational goals and objectives. An Enterprise Performance Management (EPM) can effectively solve these two problems. The key to obtain higher performance efficiency needed to achieve strategic and financial business goal is to make each individual employee and all business processes aligned with those goals. Everyone should know their required contribution towards the high-level goals, hence individual goals are set. The Enterprise Performance Management (EPM) system also highlight the areas of improvement in the business processes and is quite capable of detecting hurdles and obstacles your employee might be facing.
Furthermore the Enterprise Performance Management (EPM) system also increase and enhance the readiness and capabilities to respond to disruptions. Whether the disruption caused due to outside force, inside events, or due to the market changes the key to surviving it and staying ahead of the curve is the flexibility and agility. The Enterprise Performance Management (EPM) System helps businesses to fulfill their data gathering and reporting needs which can improve the performance of various internal processes such as Financial Close, Reconciliations, Strategic Plan Implementation, Profitability and Expense Management, Production Efficiency, and all other operational and administrative processes. On top of that an Enterprise Performance Management (EPM) software help improving employee performance all across the enterprise which automatically helps improving efficiency and performance of each business process and function.
Enterprise Performance Management (EPM) System (Software/Tools)
Enterprise Performance Management (EPM) is a very sophisticated and complex process. In the modern era of digitalization and IT integration there are simply too many data streams and processing them manually is almost impossible. That is why an automated and intuitive software or system is required which should be equipped with relevant tools and features to allow the management to effectively monitor and improve the performance of the entire business. The Enterprise Performance Management (EPM) software is an integrated tool which is linked with various other enterprise solutions and business tools to collect data and matrices. It is also connected to the central information center and it can provide two-way data synchronization and data sharing features. The software can be deployed both in cloud and in-premises data centers as well. Although business always struggle with taking this decision, but it is better to keep the Enterprise Performance Management (EPM) software online so the management and employees can also access it remotely and off-campus.
Here are key features of an Enterprise Performance Management (EPM) System:
- The user interface (UI) and user experience (UX) should be simple and easy-to-understand
- The personalization options should be available to customize user dashboard to let user arrange and add widgets and sections as per their priority and convenience
- The software should provide automation with configurable control panel to customize the operation
- Flexible integration features should be included to let the software synchronize and integrate with other business tools and systems
- Pre-built template should be added to aid the planning and strategy implementation process along with facility to add new templates
- Facility to set goals and objectives and ability to blend goals along with real-time monitoring for day-to-day task and along term evaluation
- Features for top-down approach to effectively implement strategic and planning tactics
- Customizable review cycle timings and scheduling features to allow management to decide who should conduct reviews, when the review should be conducted and frequency of the reviews
- Ability to allow management to implement SMART and 5As goals for both high-level and individual levels
- Dedicated module for managing one-on-one sessions and conduct feedbacks and surveys
- Administrative features for managers to plan and schedule session from their dashboard
- Features to allow downward, upward and peer to peer feedbacks
- User feedback facility to let employees provide feedback at any time
- Robust alerts and notification engine to automate the notification process along with facility to set priority and importance for each alert
- Configurable and automatic data sharing features along with facility to allow users to share selective data, feeds and reports
- Configurable reporting module to allow users to generate different types of reports
- In-built data processing and advanced analytical tools to simplify the reporting process
- Facility to do comparative analysis with historic analytical data
- Flexible infrastructure to support future upgrades, customization and scalability
These are some of the most important features a good Enterprise Performance Management (EPM) System should have. Businesses should also explore the customized software development possibilities rather than going for a commercial off-the-shelf solution (COTS). The customized solution allow business to easily customize the software as per their performance management methods and doesn’t require them to make any change in their ongoing business processes. It also provide easier integration and reduce the cost in the long term. The future upgrades and scalability is also relatively cheaper comparing to the commercial off-the-shelf solutions.
Enterprise Performance Management (EPM) Process
The Enterprise Performance Management (EPM) process is a not as that complicated, it is a simple process which starts with setting up and assigning goals and objectives to employees, keep track of their performance make adjustments and course correction during the performance management cycle and then on the bases of final evaluation execute reward and personal development schemes. Here is the Enterprise Performance Management (EPM) process’s steps:
- Step 1: Set up goals and communicate the high-level organizational and individual goals clearly to the employees
- Step 2: Continuously monitor employees, their KPIs and their goals and make course adjustments
- Step 3: Identify the challenges and area of improvements, take actions and provide training, mentoring, and guidance to the employees
- Step 4: Rate and Evaluate the employees and performance matrices, make sure the rating criteria is clearly communicated to the employees beforehand
- Step 5:The final step is to implement reward schemes and offer financial benefits and recognition to the employees, teams and departments if they performed well
For any performance management process the main objective is to keep your employees motivated, encourage them and make sure employees and all other resources are performing in the right direction with the maximum efficiency. This will help lifting-up each and every aspect of the business and will also keep your employees engaged and loyal to the business.
Enterprise Performance Management (EPM) Best Practices
The Enterprise Performance Management (EPM) is a cycle and it should keep going on all the time. There are no hard and fast rule for doing it in a particular way. Each business find different methods and techniques more effective than the others. Acquiring a top-notch Enterprise Performance Management (EPM) System or developing a customized solution is not enough, a business must have to be able to utilize the system correctly and that can only be done if certain aspects of the performance management should be done correctly.However, there are certain best practices that if done correctly could help businesses get maximum out of their performance management efforts:
Set Goals and Objectives
Setting up goals and objectives for a performance management process is the most crucial part. On the bases of these goals the objectives the managers will build strategies and make plans. If the goals and objectives are not clear and practical then it would have negative effect rather improving anything. There are two most commonly used frameworks to set goals and objectives:
- SMART: The smart goals are Specific, Measureable, Achievable, Realistic and Time Bound.
- 5As: The 5As are Assessable, Aspirational, Agile, Aligned and Accountable.
The SMART framework is one of the most widely used framework to set goals and objectives not only in Dubai, UAE but all around the world. Earlier the framework was designed for annual and bi-annual evaluation, but now a days businesses are using the same methods to evaluate and manage performance for a particular time-frame or a project as well. The 5As is a relatively new and a bit more modernized framework for setting up goals and objectives with less timeframe, usually from one to four months. This is the major difference between the two frameworks, however, some businesses are also using a blend of the two to evaluate for short term and long terms or from totally two different prospective.
Build a Strategy and Make a Plan
Once the goals are set the next step is to make a strategy and plan about how those goals can be and should be achieved. This is very important. Only communicating the high-level organizational goals and objectives to the individual employees along with their individual goals and objectives is not enough unless and until the manager also tell them how they can achieve these goals and what the business is expecting from them. That is why having a very comprehensive plan and a strategy is a key to achieve desirable results. The employees knows their job roles already, communicating what the business is expecting from them and how they should behave is very important. Most of the time businesses treat goals and objective in a similar fashion. However both are different, the major difference is the objectives are measureable and the goals aren’t.
For example if the goal is to become the market leader in providing maintenance service in Dubai, the objective would be to increase the sales by 20%, reduce customer churn rate by 40%, improve customer satisfaction by 15%, increase online leads by 30% and so on. In order to increase the sales by 20% the sales teams might have to put extra efforts, the manager should have to tell them where to put extra efforts and what to achieve and how. That is why the goals and objectives should be clearly communicated and each employee should know what their contribution would be in those high-level goals and objectives if they will achieve their individual goals. Hence the KPIs and other performance matrices should be set in accordance with the individual and high-level goals and objectives.
Setup Performance Matrices
Once the goals and respective objectives are defined, the next important thing is to setup appropriate performance matrices. The performance matrices will monitor the employee performance and the overall performance of the business. The performance matrices will also tell employees that what would be the measure of success and when the evaluation should be done, hence they can easily prioritize their tasks and efforts to achieve the required objectives within the given time frame. It is very crucial to keep monitoring the performance and progress continuously throughout the performance cycle, this will provide managers and employees a chance to keep improving their efforts. The managers can also immediately take actions to resolve problems and sort out challenges that employees are facing and they can also make course adjustments or iterations in the individual goals to make sure by the end of performance cycle the high-level organizational goals and objectives will be achieved.
Here are some popular performance matrices that can be implemented to make the performance management more effective, convenient and fruitful:
- Key Performance Indicators (KPIs):The key performance indicators or KPIs are set to measure the performance of the individual employee, teams, departments and the overall organization as well. They measures the quantifiable value of the performance and success.
- Key Responsibility Areas (KRAs): The key responsibility areas or KRAs are the matrices to measure the performance of individual employee or set of employee or teams and departments in terms of the output or value of work they have produced.
- Objective and Key Results (OKRs):The objective and key results or OKRs are the not a performance measuring tools, in fact the OKRs are the matrices used to measure the progress towards the high-level organizational goals and objectives.
- Balanced Score Cards (BSCs):The balance score cards or BSCs are not used to track performance in fact they are used to identify the areas of improvements. A BSC includes the data from current past cycles covering four major aspects, learning & growth, business processes, customers and financial data in a single report which could quickly provide essential information to the managers and help them making decisions and setting up strategies more effectively.
Continuous Feedback
Continuous feedback is vital for achieving both individual goals and the high-level organizational goals and objectives. It provides a deeper understanding and evaluation data for individual employees as well as it also provide performance data that can be used to evaluate and assess business processes and strategies. With the continuous feedback the manager can increase employee engagements, encourage them to perform better and help them overcoming the challenges they are facing. The data is also used to reevaluate the goals and objective to align the employees and resources with the high-level organizational goals and objectives. The one-on-one sessions, discussions and coaching is very important to boost employee efficiency and it also provide them a chance to get connected with the organization and let them evaluate themselves. Which also help improving employee efficiency.
Conclusion
It is extremely important for the long term success and growth that a business achieve its goals and objectives each year. The vision of a business dictates its goals and the goals drive the objectives and strategy. In order to be successful the business must have a mechanism in place to continuously monitor its performance and the performance of its employees. That is why business use Enterprise Performance Management (EPM). The Enterprise Performance Management (EPM) is not just a tool or a process in fact it is considered to be the core of any business’s strategy. The performance management increase employee engagements, help them develop and grow and provide necessary tools to the managers and the top management to improve their performance and working capabilities. RSI Concepts is a leading name in providing Enterprise Performance Management (EPM) System and Solutions in Dubai, UAE . If you need more help on the subject or if you want us to help you with your performance management needs, please feel free to contact us through our Contact Us page or leave a comment in the comment box below and we will get in touch with you soon.
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