1. Performance Measurements by Salih Duffuaa Professor of Industrial Engineering and Operations Research

2. OutlineOutline Role of Performance MeasuresRole of Performance Measures Characteristics of Good MeasuresCharacteristics of Good Measures Approaches for developing measures in strategic planning.Approaches for developing measures in strategic planning. Implementation of measures. Implementation of measures.

3. Role of Performance Measures (PM) Assess current situation Assess current situation Launch Continuous improvement. Launch Continuous improvement. Strategic planning implementation. Strategic planning implementation.

4. Characteristic of PM Relevance: Include data that are essential to provide a basis for understanding the accomplishments of goals and objectives of the organization.Relevance: Include data that are essential to provide a basis for understanding the accomplishments of goals and objectives of the organization. Interpretability: Interpretability refers to the ease with which the intended audience can understand and use the information generated by the measure.Interpretability: Interpretability refers to the ease with which the intended audience can understand and use the information generated by the measure. Timeliness: Report in a timely manner so that it will be available to users before it loses its value in making decisions.Timeliness: Report in a timely manner so that it will be available to users before it loses its value in making decisions.

5. Characteristic of PM Reliability:. A measure is reliable if, when repeatedly applied to the same population, the same result is obtained a high proportion of time.Reliability:. A measure is reliable if, when repeatedly applied to the same population, the same result is obtained a high proportion of time. Validity:. Validity is the extent to which the measure accurately represents the quality being assessed.Validity:. Validity is the extent to which the measure accurately represents the quality being assessed.

6. Lake Suggested Outcome Based Approach It is essential to have a system by which to assess the University progress towards achieving its mission and vision. The process of developing such a system include: It is essential to have a system by which to assess the University progress towards achieving its mission and vision. The process of developing such a system include: Identify what outcomes are implied by the Identify what outcomes are implied by the mission, vision and value statements. mission, vision and value statements. Identify the key activities that support the Identify the key activities that support the outcomes? outcomes? What information is needed to assure that activities What information is needed to assure that activities and the outcomes are being completed and achieved and the outcomes are being completed and achieved

7. Balance Scored Cards Customer – Stakeholders Customer – Stakeholders Process. Process. Financial. Financial. People learning and development People learning and development

8. Objectives Based Measures Develop a set of measurable objectives if achieved will ensure the achievement of the mission and vision. Develop a set of measurable objectives if achieved will ensure the achievement of the mission and vision. For each objectives develop a set of measures that assist in checking whether the objectives is achieved. For each objectives develop a set of measures that assist in checking whether the objectives is achieved. Theses measures can be broken down in BSC framework ( Stakeholder- Financial- Process and Learning and growth). Theses measures can be broken down in BSC framework ( Stakeholder- Financial- Process and Learning and growth).

9. Strategic Factors Approach Strategic factors are those things that your organization or business units needs to get right in order to succeed with your key stakeholders, that is your customers, suppliers, employees, owners, and any other organization, business unit or individual that depend on for success. The stakeholders use these criteria to evaluate you. Strategic factors are those things that your organization or business units needs to get right in order to succeed with your key stakeholders, that is your customers, suppliers, employees, owners, and any other organization, business unit or individual that depend on for success. The stakeholders use these criteria to evaluate you.

10. Example of Strategic Factors Product quality Product quality Range of productsRange of products PricePrice ImageImage Customer service Customer service Accessibility Accessibility You develop the measures on strategic factors. You develop the measures on strategic factors.

11. What is a Balanced Scorecard?  A Process For managing and implementing strategy For managing and implementing strategy  A Framework That uses measurement to describe the strategy of an organization across four perspectives (Financial, Customer, Internal Processes, Infrastructure)  A Communication System That links strategic intent in the executive suite to each part of the organization responsible for implementation  A Measurement System That reports on strategic progress and the drivers of future performance

12.  Measurement is the language that gives clarity to vague concepts.  Measurement is used to communicate, not to control.  Strategy can be described as a series of cause and effect relationships "If we succeed, how will we look to our stakeholders?” The Strategy Financial Perspective "To achieve my vision, how must I look to my customers/ stakeholders?” Customer Perspective "To satisfy my customers, at which processes must I excel?” Internal Perspective "To achieve my vision, how must my organization learn and improve?” Organization Learning TRANSLATE THE STRATEGY TO OPERATIONAL TERMS

13. The Balanced Scorecard Adopted for a Government Organization The Mission of the organization is to fulfill Public Policy expectations “If we succeed, how will we look to our financial donors?” “To satisfy our customers, financial donors and mission, what business processes must we excel at?” “To achieve our mission, how must our people learn, communicate, and work together?” “To achieve our mission, how must we look to our customers?” Customer Perspective Budget / Financial Perspective Internal Perspective Learning & Growth Perspective Stakeholder Perspective Meeting the Expectations of Customers While Maintaining Financial Viability Constitutes Meeting Mission Objectives

14. MissionMission KFUPM is an institution of higher learning committed to: KFUPM is an institution of higher learning committed to: Preparing competent professionals in the areas of Science, Engineering, Environmental Design, and Business, empowered with knowledge, skills and values, to take leadership role in the development of the Kingdom.Preparing competent professionals in the areas of Science, Engineering, Environmental Design, and Business, empowered with knowledge, skills and values, to take leadership role in the development of the Kingdom. Conducting research that contributes to knowledge and sustainable development through innovative solutions to economic and technological problems.Conducting research that contributes to knowledge and sustainable development through innovative solutions to economic and technological problems. Providing a stimulating campus life for the welfare of its students, faculty and staff, and offering outstanding professional services and out-reach programs to the society at large.Providing a stimulating campus life for the welfare of its students, faculty and staff, and offering outstanding professional services and out-reach programs to the society at large.

15. To be a vibrant multicultural University of international repute focused on quality education and innovative research that prepares professionals and entrepreneurs to lead socio-economic and technological development in the region.To be a vibrant multicultural University of international repute focused on quality education and innovative research that prepares professionals and entrepreneurs to lead socio-economic and technological development in the region. VisionVision

16. These ten core values, within the Islamic principles, form the foundation upon which this institution builds its reputation and continuing success. These ten core values, within the Islamic principles, form the foundation upon which this institution builds its reputation and continuing success. CreativityCreativity We encourage and entertain creative ideas and solutions in teaching and learning and in research, placing it at the forefront of our focus and initiatives. ExcellenceExcellence We strive to excel in what we do by maximizing our skills and continuously improving our business processes to improve quality of our products and services. IntegrityIntegrity We attempt to adhere to ethical and professional code of conduct that encapsulates honesty, sincerity and trustworthiness. ValuesValues

17. FairnessFairness We deal fairly and humanely in all of our dealings, respecting justice and individual rights and freedom. DiversityDiversity We attract and develop students and employees of different nationalities seeking to promote cultural diversity through inclusion of a broad range of people and perspectives. ResponsivenessResponsiveness We are responsive to our stakeholders’ requisites and demands with a strong customer focus. Values Values

18. ValuesValues TeamworkTeamwork We aim to create value through teamwork in our business within and outside, treating one another with respect and to help students to share the spirit of teamwork in their academic progression. LeadershipLeadership We advocate leadership roles that uphold professionalism, responsibility and motivation. DisciplineDiscipline We focus on a disciplined behavior, interaction and approach to our professional work. TransparencyTransparency We deal in a transparent manner in matter of education, performance and progression of faculty, staff and students

19. MeasuresMeasures It is essential to have a system by which to assess the University progress towards achieving its mission and vision. The process of developing such a system include: Identify what outcomes are implied by the Identify what outcomes are implied by the mission, vision and value statements. mission, vision and value statements. Identify the key activities that support the Identify the key activities that support the outcomes? outcomes? What information is needed to assure that activities What information is needed to assure that activities and the outcomes are being completed and achieved. and the outcomes are being completed and achieved.

20. Outcomes Implied by Mission Competent professionals Competent professionals Empowered with knowledge, skills and valuesEmpowered with knowledge, skills and values leadership role in the development of the Kingdom. leadership role in the development of the Kingdom. Research that contributes to knowledgeResearch that contributes to knowledge Research contributes to sustainable developmentResearch contributes to sustainable development Innovative solutions to economic and technological problems.Innovative solutions to economic and technological problems. Stimulating campus life for the welfare of its students, faculty and staff Stimulating campus life for the welfare of its students, faculty and staff Outstanding professional services and Outstanding professional services and Outstanding out-reach programs to the society at large.Outstanding out-reach programs to the society at large.

21. Vision Implied outcomes A vibrant multicultural University A vibrant multicultural University International reputeInternational repute Quality education Quality education Innovative research Innovative research Professionals and entrepreneurs Professionals and entrepreneurs Leadership role of graduates.Leadership role of graduates.

22. Outcomes Implied by Values Creativity: Innovation Creativity: Innovation Excellence: High quality in teaching, research and service Excellence: High quality in teaching, research and service Integrity: high ethical standardIntegrity: high ethical standard Fairness: High motivation Fairness: High motivation Diversity: High performance, fairnessDiversity: High performance, fairness

23. Outcomes Implied by Values Responsiveness: Low cycle time in key processes Responsiveness: Low cycle time in key processes Teamwork: Collaboration, better quality Teamwork: Collaboration, better quality Leadership: Quality, new ideas.Leadership: Quality, new ideas. Discipline: Quality, high performanceDiscipline: Quality, high performance Transparency: Motivation, AchievementTransparency: Motivation, Achievement

24. Balanced Scorecard Approach Customer – Stakeholders Customer – Stakeholders Process. Process. Financial. Financial. People learning and development People learning and development

25. What is a Balanced Scorecard?  A Process For managing and implementing strategy For managing and implementing strategy  A Framework That uses measurement to describe the strategy of an organization across four perspectives (Financial, Customer, Internal Processes, Infrastructure)  A Communication System That links strategic intent in the executive suite to each part of the organization responsible for implementation  A Measurement System That reports on strategic progress and the drivers of future performance

26.  Measurement is the language that gives clarity to vague concepts.  Measurement is used to communicate, not to control.  Strategy can be described as a series of cause and effect relationships "If we succeed, how will we look to our stakeholders?” The Strategy Financial Perspective "To achieve my vision, how must I look to my customers/ stakeholders?” Customer Perspective "To satisfy my customers, at which processes must I excel?” Internal Perspective "To achieve my vision, how must my organization learn and improve?” Organization Learning TRANSLATE THE STRATEGY TO OPERATIONAL TERMS

27. The Balanced Scorecard Adopted for a Government Organization The Mission of the organization is to fulfill Public Policy expectations “If we succeed, how will we look to our financial donors?” “To satisfy our customers, financial donors and mission, what business processes must we excel at?” “To achieve our mission, how must our people learn, communicate, and work together?” “To achieve our mission, how must we look to our customers?” Customer Perspective Budget / Financial Perspective Internal Perspective Learning & Growth Perspective Stakeholder Perspective Meeting the Expectations of Customers While Maintaining Financial Viability Constitutes Meeting Mission Objectives

28. Measures Developed Customer/ Stakeholder Customer/ Stakeholder Quality of GraduateQuality of Graduate Teaching expenditureTeaching expenditure Image and reputationImage and reputation Leadership roleLeadership role EntrepreneurshipEntrepreneurship InnovationInnovation Project addressing National needs Project addressing National needs Client satisfaction rates Client satisfaction rates

29. Measures Developed Financial measures. Financial measures. Yearly external projects funds in SR. Yearly external projects funds in SR. Research expenditure per faculty. Research expenditure per faculty. cost per graduate. cost per graduate.

30. MeasuresMeasures Process measures Process measures Research projects approval cycle time. Research projects approval cycle time. Quality o students measured by median RAM1 Quality o students measured by median RAM1 score for the batch. score for the batch. Students success rate. Students success rate. Employment rates of graduate. Employment rates of graduate. Master student average graduation period. Master student average graduation period. Stakeholders satisfaction with services at KFUPM. Stakeholders satisfaction with services at KFUPM.

31. MeasuresMeasures People learning and development People learning and development Number of conferences per faculty member per year. Number of conferences per faculty member per year. Number of workshops or short course per staff. Number of workshops or short course per staff. % of faculty involved in externally funded projects % of faculty involved in externally funded projects % of graduate students involved in research projects.% of graduate students involved in research projects. % of faculty on sabbatical leave. % of faculty on sabbatical leave. % of faculty who goes on an international exchange yearly. % of faculty who goes on an international exchange yearly.

32. Strategic Plan Measures and Monitoring System Develop an automated performance measurement system. Develop an automated performance measurement system. Collect data and compute measures. Collect data and compute measures. Establish target and benchmarks. Establish target and benchmarks. Conduct periodic management review Conduct periodic management review If target met update targets If target met update targets If target not met modify action plans to meet targets If target not met modify action plans to meet targets Develop Flow chart Develop Flow chart

33. Automated Data Collection & Analysis Sys. Data Collection & Measures Calculation Update Target Action Plans Management Review Are You Meeting Target? Yes No Bench Mark Establish Target Strategic Plan Measures & Monitoring System

34. Strategic Objectives In order to achieve its vision and mission the University will pursue the following strategic objectives: Provide up to date current academic programs that meet international standards embed entrepreneurship and satisfy market needs.Provide up to date current academic programs that meet international standards embed entrepreneurship and satisfy market needs. Provide a student focused integrated educational experience that emphasize knowledge, skills and values. Provide a student focused integrated educational experience that emphasize knowledge, skills and values.

35. Strategic Objectives Build a strong, motivated and highly committed faculty community.Build a strong, motivated and highly committed faculty community. Attract, maintain and develop a qualified pool of undergraduate and graduate students.Attract, maintain and develop a qualified pool of undergraduate and graduate students. Provide a conducive research environment that will enable our faculty and graduate students to conduct research at the frontier of knowledge with emphasis on areas that serve and sustain the Kingdom economic development.Provide a conducive research environment that will enable our faculty and graduate students to conduct research at the frontier of knowledge with emphasis on areas that serve and sustain the Kingdom economic development.

36. Strategic Objectives Continuously build and modernize university infrastructure including computing facilities, library resources, laboratories.Continuously build and modernize university infrastructure including computing facilities, library resources, laboratories. Create and encourage strategic and value oriented partnership with industry, government, local/ international institutions and alumni.Create and encourage strategic and value oriented partnership with industry, government, local/ international institutions and alumni. Sustain a less –bureaucratic and transparent productive work culture that foster professionalism.Sustain a less –bureaucratic and transparent productive work culture that foster professionalism. Continuously improve our internal and external community servicesContinuously improve our internal and external community services

37. Strategic Objectives Establish stronger and continuous relationships with the University Alumni and capitalize on their potentials. Establish stronger and continuous relationships with the University Alumni and capitalize on their potentials. Continuously improve the quality of campus life both in facilities and activities. Continuously improve the quality of campus life both in facilities and activities. Establish a wider socio-cultural involvement with the external community and the public.Establish a wider socio-cultural involvement with the external community and the public.

38. MeasuresMeasures Define for each objective a set of measures using the context of BSC. Define for each objective a set of measures using the context of BSC. As an example for the following objective we will have: As an example for the following objective we will have: Objective: Provide a student focused integrated educational experience that emphasize knowledge, skills and values Objective: Provide a student focused integrated educational experience that emphasize knowledge, skills and values Customer: Quality of Graduates, Employment rates of graduate Customer: Quality of Graduates, Employment rates of graduate Process : Class size, Student faculty ratio, Teaching workshops attended by faculty. Process : Class size, Student faculty ratio, Teaching workshops attended by faculty.

39. MeasuresMeasures Financial: Cost per graduate Financial: Cost per graduate People learning and Development:. People learning and Development:. % of faculty on sabbatical leave % of faculty who go on an international exchange yearly % of faculty who go on an international exchange yearly