Organizational performance index

The Organization Performance Index (OPI) is an integrated score that determines an organizations competitiveness. The scores are initially generated from weighted scoring of various areas of management which include Leadership and Management, Human resource focus, customer Orientation and Marketing, Financial Management, Innovation, Information and Knowledge Management and lastly Productivity and Quality. Metrics are used to come up with the weightings required in order to generate the required results.
OPI is as a result of Innovation from the Kenya Institute of Management (KIM). It was recently used by the Small and Medium Enterprises (SMEs) Participating in the KIM Annual Business Awards (KABA).
PROPOSED RESULTS INDICATORS FOR OPI DETERMINANTS
Introduction
Results are the overall net effect derived by application determinant in an organization. During evaluation, assessors will look for the following for a three year period for result determination:
1. Current levels: How does the results compare with past performance and target vis the industry benchmark (where applicable)
2. Trend: is it improving over time?
3. Rate of improvement: How fast?
4. Significance: How does it relate to key business drivers?
5. Cause and effect: Are the results due to purposive efforts to improve performance?
6. Competitive and Benchmark comparison: How does the organization perform relative to appropriate comparisons and/ or benchmark?
7. Improvement results: How widespread?
1. Leadership and Management (4 Indicators: Stakeholder Trust, Compliance, Innovation Implementation, and Performance Management)
• Stakeholder Trust: Level of stakeholder trust in the organizational leadership and governance
• Compliance: Level of ethical, regulatory and legal compliance
• Innovation Implementation: Degree and effectiveness of implemented innovations
• Performance management measures: financial, customer satisfaction and overall business results, continuous improvement,
2. Human Resources Development (4 indicators: Employee Welfare, Workplace, Recruitment, learning and development)
2a) Employee welfare
• Employee Satisfaction level (Index)
2b) Workplace performance and effectiveness
• Work environment satisfaction level (Index)
2c) Recruitment Process
• Employee satisfaction rate with recruiting process
• Employee retention level over five years period
• Percentage of new hire retention after a given period
• Recruitment source ratio: internal -v- external applicants
• Performance evaluation scores over a given period.
• Recruitment lead-time, job offer acceptance rate , and Percentage of new employee retention
• Percentage of employees receiving regular performance reviews
• Average response time for routine HR inquiries
• Job mobility: average time employees are in the same job or function.
2d) Learning and development
• Ratio of internal versus external training (hours or cost)
• Employee satisfaction with training and training return-on-investment (ROI)
• Percentage of Human Resources budget spent on training.
• Effectiveness of employee training
3. Customer Orientation and Marketing (4 Indicators: Customer Base /Satisfaction, Revenue per segment, Profitability per Segment, Debt Control and Retention)
• Customer Base /Satisfaction: New customers acquired, brand extension, and customer satisfaction levels (index)
• Revenue per Segment: Turnover (i.e., revenue) generated by segments of the customer population and
• Profitability per Segment: Profitability of customers by demographic segments and segmentation of customers by profitability.
• Debt Control and Retention: Outstanding balances held by segments of customers, collection of debts within customer relationships and customer retention/attrition levels.
4. Financial Management (3 Indicators: Financial Planning and Control Systems, Statutory and Regulatory Compliance, Revenue Growth (Top line), Profit Growth (Bottom line), and General Financial Health.
• Financial Planning and Control Systems: Financial Systems, Financial Policies, Financial Records, General Roles in Financial Control & Accountability (Board Roles, CEO Roles, Management Team Roles, and Staff Roles), and Systems/Policy Results.
• Statutory and Regulatory Compliance: Compliance Framework, Compliance Failure, Compliance Achievement and Compliance Follow up.
• Revenue Growth (Top line), Profit Growth (Bottom line), and General Financial Health: Financial Ratio Relationships, Financial Trends, General Financial Performance, Financial Efficiency, Financial Effectiveness and Financial Economy.
5. Innovation, Information Technology and Knowledge Management (4 Indicators: Direct Improved Sales, Optimal Resource Utilization, System Functionality/Productivity, and Satisfaction Levels)
• Direct Improved Sales/service delivery level : Share of improved sales attributed to technological product and process innovation
• Optimal Resource Utilization: Degree to which technological process innovation has influenced the use of factors of production (i.e. human capital, utilization of fixed capital, material and energy consumption).
• System Functionality/Productivity: Management information system functionality and productivity, website stability, web hits, access speed, site downtime, site click through, level of security breaches, data storage, Electronic Data Interchange (EDI), web position, quality of data, information overload, project success.
• Satisfaction Levels: Intranet and extranet service internal/external satisfaction levels.
6. Corporate Citizenship and Environment (4 Indicators: Resource Use, Operational Effectiveness/Efficiency, Community/Public Support, Alignment with Environmental Programme)
• Resource use: total energy used, water use and disposal level per unit of product manufactured, Level of energy saved due to environmental and efficiency improvements
• Operational effectiveness and efficiency: such as reduced emission levels, paper pages used per employee per month, waste stream reductions, by-product use and recycling, level of recycled operational hazardous/non-hazardous waste
• Community/Public Support: Level of support for key communities and public purposes
• Alignment with Environmental Programme: Level of Alignment, awareness and implementation for environmental programmes and avoidance of sanctions and/or adverse actions as a result of environmental requirements
7. Productivity and Quality (4 Indicators: Product/Quality Improvement, Process Improvement, Supply Chain Relationships and Satisfaction levels)
• Product/Quality Improvement: Product maturity /extension and continuous improvement and quality audits
• Process Improvement: Time, budget, specification, project success measures, maintenance costs, production measures such as lean flow charts, idle machines, duty-rosters, reduced / eliminated process delays, Overall Equipment Efficiency(85% indicate world class )
• Supply Chain Relationships: Supply chain indicators such as inventory reduction, inspections, improved electronic data exchange and reduction in supply management costs, Supplier, partner performance, and percentage outsourcing,
• Satisfaction levels: Internal and external (customer) product and quality service satisfaction levels

Main Menu

See Also

Main Menu