needs of the stakeholders are satis

needs of the stakeholders are satisfied. Therefore, the
second facet of the Prism asks: ``What are the strategies
we require to ensure the wants and needs of our
stakeholders are satisfied?''.
The third facet of the Performance Prism ± the
Processes facet ± asks the question: ``What are the
processes we have to put in place in order to allow our
strategies to be delivered?''. Here we are talking about
processes in the sense of the common generic business
processes, which underpin the vast majority of
organisations. These are: develop new products and
services, generate demand, fulfil demand, plan and
manage the enterprise. For each of these (normally
cross-functional) processes, it should be possible to
identify specific measures that allow management to
address particular questions associated with each one.
For example, it might be necessary for an operations
executive to ask: ``Are the organisation's fulfil demand
processes working efficiently and effectively?'' and ``If
not, how will I know which sub-components of it are the
cause of its inefficiency or ineffectiveness?'', and so on
through the other processes and their sub-sets.
The fourth facet of the Performance Prism, the
Capabilities facet, is perhaps the least widely understood.
As we have seen, capabilities are a relatively new but
important management concept. Capabilities are the
combination of people, practices, technology and
infrastructure that together enable execution of the
organisation's business processes (both now and in the
future). They are the fundamental building blocks of the
organisation's ability to compete. Without the right
people, practices, technology and infrastructure in place, it
is impossible to execute or improve the processes. The key
question associated with this facet becomes: ``What are the
capabilities we require to operate our processes?''. As soon
as this question has been answered, then it becomes
possible to identify measures that allow the organisation to
assess whether it has the required capabilities in place
now, or has plans to implement them, and whether they
are being sufficiently nurtured and protected.
The fifth and final facet of the Performance Prism is
the Stakeholder Contribution facet. This facet has been
included as a separate component since it recognises the
fact that not only do organisations have to deliver value
to their stakeholders, but also that organisations enter
into a relationship with their stakeholders which should
involve the stakeholders contributing to the
organisation. Take employees, for example. Employees
want from an organisation a safe, secure place to work.
They want a decent salary. They want recognition. They
might also want an opportunity to influence the
organisation. In return, the organisation itself wants its
employees to contribute to the business. It wants them
to offer ideas and suggestions, to develop expertise, to
turn up for work and to remain loyal to the business ±
training up replacement staff costs money. This
symbiotic relationship between the organisation and the
stakeholder is true for all classes of stakeholder ±
whether we are talking about suppliers, customers,
employees, alliances, investors, or the local community.
All other measurement frameworks we have researched
fail to recognise the reciprocal relationship between the
stakeholder and the organisation. It is a critical and
unique feature of the Performance Prism.
It should be noted that the Performance Prism is not
a prescriptive measurement framework. Instead, the
Performance Prism is a framework ± a tool ± which can
be used by management teams to influence their
thinking about what the key questions are that they want
to address when seeking to manage their business.
The Performance Prism experience
So far, we have explored the Performance Prism from a
theoretical perspective and explained its rationale,
highlighting some of the issues it was designed to
overcome. The question that remains, however, is how
does the Performance Prism work in practice and it is
this question that the case examples that follow set out to
address.
The DHL case
One of the first applications of the Performance Prism
took place at DHL International in the UK (DHL UK).
DHL is one of the world's most successful international
express courier companies. Sales in the UK for 1999
were in excess of £300 million, during which time the
business employed almost 4,000 people, across 50
locations. The board of DHL UK comprises a managing
director, a finance director, a commercial director, an
operations director, a business process director, an HR
director, an IT director and three area directors. The
team meet on a quarterly basis to review DHL's
performance and have recently used the Performance
Prism to establish what should be discussed at their
quarterly performance reviews.
Previously, DHL's UK board used to meet on a
monthly basis and review company performance data at
a detailed level. They would look at the UK's operation
in terms of its ability to achieve ``notional result'', DHL's
internal measure of profitability. They would also review
operations performance. The number of definitions of
operations performance is vast. Operations performance
can be reviewed in terms of packages shipped (volume of
packages), packages delivered on time, packages on time
to particular destinations, DHL's service quality
indicators, etc. There was growing frustration among
members of the board that on a monthly basis the group
would meet and review very detailed performance data,
yet rarely did the outcome of these reviews have a
significant impact across the entire business. A symptom
of this process was the fact that the same issues arose at
each monthly performance review.
The board began to explore the reasons for this and
decided that one of the most fundamental issues was
that the meetings structure and review process in DHL
was not right for a twenty-first century business.