Question

Performance measurement is obviously important to organisations in their pursuit of their various goals and strategies. But CEOS are concerned with choosing the right measures for their organisation – particularly so, given the uncertainty of today’s business environment. What advice would you provide to a CEO about the best way to go about selecting the key measures for their business?

Answer 1

Choosing the right performance indicators for a business are very important and that needs to be an effective measure which will give the actual status of the organization. The world of business is very much dynamic and there is no way organizations can stick to a single measure because that may not be able to provide the exact status of organizations. Profit is a way to understand this but again profit may not reflect the future and for that the organization needs to be creative, unique and should be able to use its resources accordingly. It would be better for the organization if the measures used are dynamic and help organization understand Customer Satisfaction, Customer Retention, Customer Lifetime value, employee satisfaction, etc. I believe that these measures are the best to understand the actual performance of the organization at present and even in future.