The Harvard Business Review publishes in its October edition an article titled "The True Measures of Success". The author describes, how manager often are taken in by intuition mistakes with regard to success measurement parameters. They overestimate their power of judgement, bank on readily accessible data or retain to established processes. Thus, managers establish coherences between variables, which cannot be proved statistically. The connection between added value and the two most popular performance indicators - Earnings per Share (EPS) growth and Sales Growth - cannot be outlined neither theoratically nor empirically.
At REFLECT, we do now the following: In order to define significant ratings, it is not sufficient to rely only on the intuition of one or few persons. The critical measures of success, which have the most important whip with regard to added value, have to be analysed from as many different perspectives as possible. The question, you should ask yourself, is as follows: What makes us successful and which factors are the decisive success drivers? These factors are interconnected, that means they are subjected to interdependences. And they are dynamic: Strategy and aim change corresponding to market situations and therefore, the success drivers change as well. The regular analysis of these factors is an essential element of your Performance Management and in the end of your competitive advantage.