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Casestudies
 

Casestudies

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    Casestudies Casestudies Presentation Transcript

    • BetterManagement Presents Achieving Performance Improvement: Case Studies in Performance Management Presented By: Tony C. Adkins SAS Visionary perspectives for management insights Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Meaningful Performance Management Meaningful Accurate Aligned Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Managing the business: Why should I be interested? Less than 10% of strategies effectively executed Confusion & politics • Inconsistent messages, no understanding of what creates value • Siloed operations, different agendas • Inefficient allocation of resources • Short term thinking/ tactics • Drowning in data, constant fire fighting Copyright © 2004, SAS Institute Inc. All rights reserved.
    • What is Performance Management? • IT Analysts • Commercial business • Public sector Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Commercial business Manage the limited resources How to achieve more profit Ideally aligned with corporate strategy Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Public sector The difference here is the lack of focus on “profit.” In a report outlining the PMA, President George W. Bush wrote: “Government should be results oriented – guided not only by process but guided performance. There comes a time when every program must be judged either a success or a failure. Where we find success, we should repeat it, share it, and make it the standard. And where we find failure, we must call it by its name. Government action that fails in its purpose must be reformed or ended.” Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Managing the business Resources resource drivers Performance Cost Drivers Activities Measures activity drivers Customers, Products, Services & Channels Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Managing the business Resources resource drivers Performance Cost Drivers Activities Measures activity drivers Customers, Products, Services & Channels Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Managing the business Resources resource drivers Strategy Performance Cost Drivers Activities Modeling Measures activity drivers Customers, Products, Services & Channels Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Managing the business Resources resource drivers Strategy Performance Cost Drivers Activities Modeling Measures activity drivers Customers, Products, Services & Channels Planning Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Managing the Budgeting business Resources resource drivers Strategy Performance Cost Drivers Activities Modeling Measures activity drivers Customers, Products, Services & Channels Planning Copyright © 2004, SAS Institute Inc. All rights reserved.
    • EXECUTION Managing the Budgeting business Resources resource drivers Strategy Performance Cost Drivers Activities Modeling Measures activity drivers Customers, Products, Services & Channels Planning Copyright © 2004, SAS Institute Inc. All rights reserved.
    • EXECUTION Managing the Budgeting Consolidation business Resources resource drivers Strategy Performance Cost Drivers Activities Modeling Measures activity drivers Customers, Products, Services & Channels Planning Copyright © 2004, SAS Institute Inc. All rights reserved.
    • EXECUTION Managing the Budgeting Consolidation business Resources resource drivers Scorecard/ Strategy Performance Dashboard + Cost Drivers Activities Modeling Measures Compliance activity drivers Customers, Products, Services & Channels Planning Copyright © 2004, SAS Institute Inc. All rights reserved.
    • EXECUTION Managing the Budgeting Consolidation exploration business Resources resource drivers Scorecard/ Strategy Performance Dashboard + Cost Drivers Activities Modeling Measures Compliance activity drivers Customers, Products, Services exploration & Channels Planning Copyright © 2004, SAS Institute Inc. All rights reserved.
    • EXECUTION Managing the Budgeting Consolidation exploration business Resources Human & IT Capital Manufacturing & Research resource drivers Scorecard/ Strategy Performance Dashboard + Cost Drivers Activities Modeling Measures Compliance activity drivers Process & Customers, Quality Improvement Products, Services exploration & Channels Economic & Market trends Supplier/ Customer Planning interactions, logistics & behaviors Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Managing the business: Where do I start? Understand how you consume information today Information Evolution Model Level 5: Innovate (effectiveness) Exploit Level 4: Optimize (efficiency) Level 3: Integrate (transparency) Level 2: Consolidate (silos of many) Gather Level 1: Operate (silos of one) Factors that influence results • People (Skills, ability, needs) • Process (Logical execution) • Culture (Values toward use of information) • Infrastructure (How systems support business needs) Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Information Revolution – Authors: Jim Davis, Gloria J. Miller, Allan Russell Copyright © 2004, SAS Institute Inc. All rights reserved.
    • A Brief look: Four Case Studies LubeOil HomeHealth Super Draft Armed Forces Copyright © 2004, SAS Institute Inc. All rights reserved.
    • LubeOil Copyright © 2004, SAS Institute Inc. All rights reserved.
    • LubeOil Copyright © 2004, SAS Institute Inc. All rights reserved.
    • LubeOil BENCHMARK TEMPLATE # 1 ABC Profit Value Chain Affiliate: Various Global Sort Criteria: Total Lube Business *All revenue/cost in USD/BBL Raw Acct Del Sales and Net Affiliate Volume (BBL) Realization Material GM LOBP Distribution GM Marketing Advertising Margin 6,202,039 150.5 85.7 64.8 11.1 45.1 21.8 6.2 17.1 8.6 Local Affiliate 1 1,025,109 162.2 94.6 67.6 17.5 16.6 33.6 19.7 6.1 7.8 Local Affiliate 2 832,344 166.6 81.7 20.5 11.5 49.6 22.9 5.9 20.7 84.9 Local Affiliate 3 489,227 135.9 92.2 43.7 9.7 25.7 4.0 12.2 8.3 9.6 Local Affiliate 4 368,164 188.9 105.8 83.1 72.2 21.1 7.9 2.9 1.7 49.3 Local Affiliate 5 91,373 87.5 30.8 4.9 71.7 14.2 10.8 219.8 132.3 96.7 Local Affiliate 6 154.8 87.8 67.0 10.9 11.3 44.8 21.5 5.9 17.4 Affiliate Weighted Average 487,164 193.0 113.0 80.0 28.0 4.0 48.0 38.0 14.0 -4.0 Regional grouping 38.2 -25.2 13.0 -17.1 7.3 3.2 -16.5 -8.1 -21.4 VARIANCE TO AVG Copyright © 2004, SAS Institute Inc. All rights reserved.
    • HomeHealth - Challenges Reduce cost • For reimbursement changes Maintain quality • Quality as defined by our customers Improve access • Provide services that focus on the needs & wants of our customers Copyright © 2004, SAS Institute Inc. All rights reserved.
    • HomeHealth Psych nursing visit is 3 times more costly than med-surg visit HMO visits cost 1.5 times more than Medicare visits Admission process costs $450/client PT travel is 2 times more expensive than RN travel Documentation costs $45 per visit Copyright © 2004, SAS Institute Inc. All rights reserved.
    • HomeHealth Activity “costing” can elicit fear and defensiveness Activity “management” may be more acceptable Education begins with staff interviews Sharing what makes work hard validates staff long-standing frustrations and involves them in the process Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Strategic Planning Focus strategic plan on areas that are most important to customers and/or high cost Obtain organizational commitment to objectives and tactical plans Copyright © 2004, SAS Institute Inc. All rights reserved.
    • SuperDraft - Challenges Define profit by each of SuperDraft’s more than 18,000 customers Create a sustainable ABC/M system Build and deploy an ABC/M system in six months Deliver results of major impact Copyright © 2004, SAS Institute Inc. All rights reserved.
    • SuperDraft Copyright © 2004, SAS Institute Inc. All rights reserved.
    • SuperDraft Copyright © 2004, SAS Institute Inc. All rights reserved.
    • DND - Canarus Create ABC models to support business planning Ensure the ABC models are fundamental part of the IME Create a scorecard driven system that could also be used for re-engineering, ASD, continuous improvement Tie the ABC models into the financial and managerial accounting system Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Integrated Management Environment BUSINESS PLANNING PROCESS BALANCED SCORECARD Operational Forces Key Strategies Output Input O CF/DND Command & Control U T Training Maximize Op Optimize Protect Personnel P Combat Capability Resource Use Environment U Support Materiel Capable Strengthen Provide Promote T Infrastructure Defence Team Support Awareness Mandated Programs Forces S $ Operational Forces Accountability View LFC LFWA LFCA SQFT LFAA 1 DIV CLFCSC LS Economy Efficiency Effectiveness ... ... Performance Measurement EIS ... ... ... ... ... Activity Based Management Risk Assessment Process View CF/DND S Dir C Mgmt F Gen F Emp Data Mart C&C Op Forces Trg Support M Prog Service Standards Fin Mat Training Standards Pers Pers Eqpt Org Safety Benchmarks C Trg Indiv Trg Plans Infra National Systems OVERSIGHT AND CONTROL FRAMEWORK Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Major Lessons Learned Highlight and ACT Link ABM to Performance Management Activity “costing” can elicit fear Can be complex “Pot of Gold at the End of the Rainbow” Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Questions? Tony Adkins Tony.Adkins@sas.com Copyright © 2004, SAS Institute Inc. All rights reserved.
    • Upcoming Webcasts Leadership Essentials for Balanced Scorecard Success: How to Get Everyone Involved in Running Your Business Balanced Scorecard Fundamentals Barriers and Benchmarks: Performance Improvement Benchmarking Survey Conclusions http://www.bettermanagement.com/seminars/seminarList.aspx?f=11 Sam Sheikh Sam.Sheikh@BetterManagement.com Copyright © 2004, SAS Institute Inc. All rights reserved.