Business Performance Management - working with tensions

Effective BPM is central to the success of all organisations. On the face of it, it sounds simple: determine the organisation’s strategy, implement it, measure progress and adapt accordingly. However, speak to any accountant in business and it becomes clear that in practice things are never so easy. Inevitably the conversation will include dealing with conflicting stakeholder needs, inaccurate data and information being ignored by decision makers.

Business Performance Management reports

With these challenges in mind, ICAEW has produced two reports that provide you with an opportunity to stand back and examine your own approach to performance management. While our first report looked at approaches and tensions, our second report, Business Performance Management Report 2—working with tensions, drills down into the tensions to provide practical advice on how to deal with them.

While there is no one size fits all approach, a framework can be a useful tool

To analyse business performance management, we set out its component parts in a framework against which you can map your current processes (see the BPM framework image). We hope that the framework will help you to clarify your thinking on BPM, map your current approach against our model and in doing so, identify areas of concern, and explain BPM to others in your organisation. However, in practice, it is where this framework interacts with real-world tensions, such as meeting multiple stakeholder needs, that an organisation needs to focus its energy. 

Working with tensions

Even if an organisation has considered the key elements of BPM and tailored them to its own circumstances, tensions will occur and need a response. During our conversations with members some tensions frequently cropped up. That is why we have focused on these tensions in our BPM2 report.

In the report we detail a number of ways to respond to the tensions. We also provide six case studies showing how BPM works in practice. BPM itself is an ongoing cycle, and an opportunity for continuous improvement. There is no perfect one-size-fits-all approach. It is about constantly aiming for a “good enough solution” through a process of trial and error. Such a demanding task calls for finance professionals with strong business knowledge who are able to exercise professional judgement. Indeed, it is in dealing with the tensions in BPM that finance professional demonstrate their mettle.

We welcome comments on the reports and in particular further case studies highlighting BPM tensions and practical ways of dealing with them. Please contact rick.payne@icaew.com with your thoughts.

• Download the full report
• Further information on ICAEW's Finance Direction programme

Further resources: BPM tensions case studies

• Informal controls and staff capabilities - transport company
• Focusing on your key success factors - direct sales kitchen company