Analysis is one of the critical stages in performance management.
Performance management is a methodology for improving organizational results to realize the organizational strategy. As we know, results are achieved through organizational performance; to improve them, we must correspondingly enhance organizational performance.
How do we improve organizational performance?
To provide an answer to this complex question, we must address three layers of action:
Monitoring: The ability to understand what is currently happening or what happened in the past in the organization, such as the sales volume of each product.
Analysis: The ability to understand why certain trends and specific results occur or occur in the organization, for example, why did the sales volume of product X decrease and not product Y?
Planning is the organization's ability to predict what will happen and outline courses of action to realize the optimal forecast. For example, introducing an additional product to the market can improve overall sales volume by 20%.
Let's focus on the central layer—the Analysis stage. The analysis stage is critical: it connects monitoring to planning and allows realistic, fact-based prediction.
As mentioned, the purpose of the analysis is to explain why the given occurrence happened in the organization. For example, why did sales volume decrease? Why did sales volume decrease specifically for the specific product?
Understanding the circumstances of the given organizational situation is critical for improving future performance. It will be difficult to learn if we don't understand where we went wrong.
The more positive side of the coin is understanding the need to clarify the circumstances for exceptional organizational performance. For example, employee productivity doubled in a certain quarter: proper analysis will help us understand why this happened—are employees worried about layoffs and therefore motivated to improve? Perhaps a manager who knew how to reward them through shows of appreciation motivated them to improve. After all, that same factor supporting added value could be harnessed for improved future planning.
After understanding the importance of the analysis stage, how can we improve it?
Bruno Aziza and Joey Fitts mention in their book "Drive Business Performance" three guiding principles that help companies realize benefits from analytical capability:
Organizational agility
Relevance
Efficiency
Organizational Agility
Critical for dealing with changing reality, which is so characteristic of the world we live in today. The evolving reality holds within its changing needs, opportunities, and threats. Globalization only intensifies the need to react quickly to change, progress, and survive. For this purpose, it is required:
The transition from analytical analysis by individual employees considered "experts" in their field to the knowledge of all employees in different business units
Analysis supporting the entire spectrum of organizational decision-making (strategic, tactical, and operational)
Support of web-based analytical software in organizational work processes (such as DSS - decision support systems)
Utilizing a set of tools that are easy to understand and cognitively process to support ongoing activity (integrated dashboard tools, for example)
Recognition of the value derived from a work environment embedded with personal software (like Excel) under limitations so that a situation of over-decentralization of work environments is not created.
Data Relevance
Information and knowledge are critical for decision-making and organizational performance.
Relevance facilitates focus, thereby helping employees avoid wasting valuable work time analyzing irrelevant reports and graphs. Employees need to be able to access content required for decision-making and routine tasks according to their roles.
To ensure relevance, it is recommended to use filters and, by default, offer access to information as limited as possible (to prevent "getting lost"). If the user requests to expand the scope of information they need, they can expand access to the knowledge base.
When necessary, graphs and reports can also be accompanied by recommendations for action, tips, and insights.
Efficiency
Reliable analytical analysis enables it at the level of performance and duration of routine task execution. Such analysis allows for a deeper understanding of information, more accurate identification of trends, and faster action.
Analytical analysis tools should be designed accordingly:
Allow multi-dimensional levels of detail and expansion (Drill): up and down, across, in-depth, from branch to branch, etc.
Allow quick access to the tree's root and the most basic data, regardless of the organization's amount of information and data.
Provide an accessible, simple, intuitive, interactive, and flexible response to the professional needs of the employee as much as possible.
As mentioned, knowing where you came from will help you decide where you are going.
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