Business Performance Measurement: Essential Concepts

Introduction

Enhancing the performance of a certain team in a specific business environment implies that the person acting as a change agent is capable of identifying every single variable in the corporate equation. Unless the crucial concepts are identified, creating an efficient team is hardly possible. Therefore, the definitions provided for the items below can be viewed as the foundation for becoming an efficient team leader and improving the performance rates successfully.

Stakeholders

As a rule, the concept of a stakeholder serves as the umbrella term for all people that are somehow related to a specific project or a certain company. In other words, the stakeholders of a company can be described as the people that are affected in some way by the decisions and choices made by the entrepreneurship. For instance, both customers of a specific company and the employees working for it can be deemed as the stakeholders of the entrepreneurship, as the changes in the company’s policy will affect both categories (Benbow, & Kubiak, 2009a).

CTQ factors

In the Six Sigma framework, CTQ, or Critical to Quality, are the quality parameters that define the product quality standards set in a particular organization. In addition, CTQ may also be viewed from the customer’s perspective. To be more accurate, CTQs are the quality standards that reflect the needs and expectations of the target customers. Therefore, CTQs serve as the tools for making sure that the product is important and valuable to the customer (Benbow, & Kubiak, 2009b).

Benchmarking

As a rule, the process of results assessment, especially when comparing the current results with the customer’s expectations, is referred to as benchmarking. The benchmarking stage is carried out at the beginning of the evaluation process and starts the audit. The significance of the subject matter is determined by the insight that the participants gain during the procedure: “Benchmarking is useful for driving breakthrough improvement over continuous improvement” (Benbow, & Kubiak, 2009c).

Balanced Scorecard

A Balanced Scorecard is a tool used for strategic planning, as well as the further management of the team’s performance. To be more accurate, the Balanced Scorecard allows measuring the results of a company’s performance based on the existing standards and, therefore, defining the outcomes as either valid or not (Benbow, & Kubiak, 2009d). A Balanced Scorecard is a perfect tool for identifying the direction in which a firm needs to evolve to meet the increasingly demanding needs of the target customers.

Cost of Quality

The concept of the Cost of Quality is typically rendered as the set of methods serving the purpose of defining the efficacy of a company in producing high-quality products (Benbow, & Kubiak, 2009e). In other words, the Cost of Quality should be interpreted as the framework that creates prerequisites for the company’s further evolution, its acquisition of new customers, and the success in increasing loyalty rates among the old ones.

Conclusion

Serving as the means for identifying the crucial variables in the performance enhancement formula, the concepts listed above need proper identification. The definitions for the items in question, therefore, should be viewed as the prerequisites for carrying out a successful analysis of a particular team, determining the problems that it has faced or may encounter in the future, and designing the strategy that will help avoid or confront these problems successfully.

Reference List

Benbow, T. M., & Kubiak, D. W. (2009a). Chapter 3. Impact on stakeholders. In The Certified Six Sigma Black Belt handbook (2nd ed.) (pp. 22-23). Milwaukee, WI: American Society for Quality.

Benbow, T. M., & Kubiak, D. W. (2009b). Chapter 4: Critical to x (CTx) requirements. In The Certified Six Sigma Black Belt handbook (2nd ed.) (pp. 24-25). Milwaukee, WI: American Society for Quality.

Benbow, T. M., & Kubiak, D. W. (2009c). Chapter 5: Benchmarking. In The Certified Six Sigma Black Belt handbook (2nd ed.) (pp. 26-27). Milwaukee, WI: American Society for Quality.

Benbow, T. M., & Kubiak, D. W. (2009d). Chapter 6: Business performance measures. In The Certified Six Sigma Black Belt handbook (2nd ed.) (pp. 28-31). Milwaukee, WI: American Society for Quality.

Benbow, T. M., & Kubiak, D. W. (2009e). Chapter 7: Financial measures. In The Certified Six Sigma Black Belt handbook (2nd ed.) (pp. 32-36). Milwaukee, WI: American Society for Quality.

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