Key indicators for organizational performance measurement

Article history: Received January 20, 2014 Accepted 5 July 2014 Available online August 15 2014 Each organization for assessing the amount of utility and desirability of their activities, especially in complex and dynamic environments, requires determining and ranking the vital performance indicators. Indicators provide essential links among strategy, execution and ultimate value creation. The aim of this paper is to develop a framework, which identifies and prioritizes Key Performance Indicators (KPIs) that a company should focus on them to define and measure progress towards organizational objectives. For this purpose, an applied research was conducted in 2013 in an Iranian telecommunication company. We first determined the objectives of the company with respect to four perspectives of BSC (Balanced Scorecard) framework. Next, performance indicators were listed and paired wise comparisons were accomplished by company's high-ranked employees through standard Analytic Hierarchy Process (AHP) questionnaires. This helped us establish the weight of each indicator and to rank them, accordingly. © 2014 Growing Science Ltd. All rights reserved. Turnover intentions Key Performance Indicators (KPIs) BSC AHP Telecom Company

[1]  Arash Shahin,et al.  Prioritization of key performance indicators: An integration of analytical hierarchy process and goal setting , 2007 .

[2]  Charles P. Seeley Reengineering the corporation: a manifesto for business revolution [Book Review] , 2003, IEEE Engineering Management Review.

[3]  J. Dyer Remarks on the analytic hierarchy process , 1990 .

[4]  J. Barney Gaining and Sustaining Competitive Advantage , 1996 .

[5]  P. Savioz,et al.  Strategic forecast tool for SMEs: how the opportunity landscape interacts with business strategy to anticipate technological trends , 2002 .

[6]  R. Armacost,et al.  Using the analytic hierarchy process for bank management: Analysis of consumer bank selection decisions , 1989 .

[7]  David Parmenter,et al.  Key Performance Indicators: Developing, Implementing,and Using Winning KPIs , 2007 .

[8]  Noah P. Barsky,et al.  Utilizing the balanced scorecard for R&D performance measurement , 2004 .

[9]  A. Atkinson,et al.  A Stakeholder Approach to Strategic Performance Measurement , 1997 .

[10]  D. B. Smith,et al.  Managing For Value: Developing A Performance Measurement System Integrating Economic Value Added and The Balanced Scorecard In Strategic Planning , 2004, Journal of Business Strategies.

[11]  R. Kaplan,et al.  Using the balanced scorecard as a strategic management system , 1996 .

[12]  M. Sharma,et al.  An integrated BSC‐AHP approach for supply chain management evaluation , 2007 .

[13]  Patrick T. Harker,et al.  The Art and Science of Decision Making: The Analytic Hierarchy Process , 1989 .

[14]  Raja R. A. Issa,et al.  Management’s Perception of Key Performance Indicators for Construction , 2003 .

[15]  S. Sawang,et al.  Key performance indicators for innovation implementation : perception vs. actual usage , 2011 .

[16]  B. Chakravarthy Measuring strategic performance , 1986 .

[17]  T. Saaty,et al.  The Analytic Hierarchy Process , 1985 .

[18]  J. C. Thomas,et al.  Developing a Municipal Performance‐Measurement System: Reflections on the Atlanta Dashboard , 2005 .

[19]  T. Saaty An exposition of the AHP in reply to the paper “remarks on the analytic hierarchy process” , 1990 .

[20]  Evi I. Plomaritou,et al.  Key Performance Indicators (KPIs) and Shipping Companies Performance Evaluation: The Case of Greek Tanker Shipping Companies , 2012 .

[21]  Michael J. Provitera What Management Is: How It Works and Why It's Everyone's Business , 2003 .

[22]  Alexandre Veronese Bentes,et al.  Multidimensional assessment of organizational performance: Integrating BSC and AHP☆ , 2010 .

[23]  N. Venkatraman,et al.  On the Measurement of Business Performance in Strategy Research: A Comparison of Approaches , 2015 .

[24]  R. Kaplan,et al.  The balanced scorecard--measures that drive performance. , 2015, Harvard business review.

[25]  E. Forman,et al.  Aggregating individual judgments and priorities with the analytic hierarchy process , 1998, Eur. J. Oper. Res..

[26]  N. Ismail International Journal of Business and Management , 2013 .

[27]  Gopal K. Kanji,et al.  Kanji's Business Scorecard , 2001 .

[28]  Jan Bilderbeek,et al.  R&D Performance Measurement: More than Choosing a Set of Metrics , 1997 .

[29]  Xianhai Meng,et al.  Performance measurement models in facility management: a comparative study , 2011 .

[30]  Chi-Wei Lee,et al.  Understanding m-commerce payment systems through the analytic hierarchy process , 2004 .

[31]  Jose Dario Luis Delgado,et al.  Key Performance Indicators for QOS Assessment in TETRA Networks , 2014, ArXiv.

[32]  D. Larcker,et al.  Innovations in Performance Measurement: Trends and Research Implications , 1998 .

[33]  David P. Norton,et al.  The Balanced Scorecard , 1998 .

[34]  A. Voronin A method of multicriteria evaluation and optimization of hierarchical systems , 2007 .

[35]  Mladen Radujković,et al.  Leading, lagging and perceptive performance measures in the construction industry , 2010 .

[36]  E. Ziegel,et al.  The Balanced Scorecard , 1998 .

[37]  Andi Smart,et al.  Theory and practice in SME performance measurement systems , 2001 .

[38]  Margarita Išoraite ANALYSIS OF TRANSPORT PERFORMANCE INDICATORS , 2005 .

[39]  Peter Kawalek,et al.  Goal-based business process models: creation and evaluation , 1997, Bus. Process. Manag. J..