Performance Measurements and Strategic Planning

Performance Measurements and Strategic Planning
Performance Measurements and Strategic Planning

Performance Measurements and Strategic Planning

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((The impact of performance measurement in strategic planning’, International Journal of Productivity and Performance Management)))

that is attached then answer the following questions:

1)Evaluate the finding that PM is one of the key success factors in strategic planning.

2)What effect do you think a) the size of the organisation and b) the rate of change have on the effectiveness of performance measurement?

3)Support your argument with evidence from the study and other real examples where possible.


1)The answer must raise appropriate critical questions.

2)Do include all your references, as per the Harvard Referencing System,

3)Please don’t use Wikipedia web site.
4) I need examples from peer reviewed articles or researches.

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Note: To prepare for this essay please read the required articles that is attached

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Performance Measurements and Strategic Planning

A company’s success depends highly on proper planning of organization activities, efficient and effective management as well as having a motivated team of employees. Therefore, corporate planning is paramount for ensuring that business activities are thriving, and organization is driven towards corporate sustainability.  Employees and other stakeholders should work together to ensure that the organization is effective in its organization activities. And hence enable an organization achieves the company’s goals and mission. This is possible through performance measurement to help the organization in evaluating individual employee and motivate the employees to perform optimally. However, the paper discusses the notion that performance measurement is important in strategic planning. Further, the article provides insights on the relationship between the company size and how the rate of change impact on the efficiency of PM.

Performance measurement can be defined as a process by which the management in conjunction with the employees work as a team to plan, monitor and review employee’s work goals, and the overall contribution of each and every employee to the organization(Sena Ferreira et al., 2012) . On the flipside, strategic planning refers to a set of processes performed in an organization to conceptualize multiple plans that can help an organization achieve its goal and provide organizational direction (In Osman et al., 2014).

Empirical studies establish that performance measurement and organization strategy should be aligned together to help an organization achieve its strategic goals. Be as it may, performance measurement is paramount in enhancing the efficiency of strategic planning (De Waal, 2013). Performance measurement provides critical data and controls that enhance the development and implementation of strategic planning. Performance measurement’s is used by the organization as a tool that helps to provide a sense of direction for the company by directing on the allocation of resources appropriately (Tapinos et al., 2015). Proper allocation helps an organization to utilize the scarce resources to produce optimum services and increase the company’s revenue (Taticchi, 2011). This feature also enables an organization to allocate the resources according to the strategic plans put developed to govern the organization.

Performance measurement is also an important tool to help an organization to communicate and assess the development of an organization towards achieving strategic goals. Evaluation of managerial performance through balanced scorecard and assessment of employees based on their job performance is important in ensuring that the organization is working towards achieving what is laid down in the strategic plan. Having a well laid out performance measurement program addresses individual employees and organization performance issues that are necessary to develop an effective and sustainable strategic plan.

Strategic planning is essentially a disciplined effort geared to produce fundamental actions based on sound decision that help to provide direction. Therefore, performance measurement plays the important role of raising individual performance to help foster the overall development of employees. This tendency complements strategic planning efforts to increase the overall company effectiveness.

Performance measurement has a key role of translating strategy into practical plans. Managers develop overarching metrics to help track organization activities through performance measurements. Such metrics translates to the larger goals of the organization. The individual department focuses on specific performance measurement metrics to help improve the departmental performance.  For instance, the marketing team is concerned more with the number of sales generated, qualified leads and the conversion rates within the sales department. The customer care department focuses on measuring performance relating to customer satisfaction. And finally, the operation department may focus on measuring performance based on quality fulfillment, delivery time, and number of orders filled. All these measurement metrics are geared towards achieving the overall strategic goals by translating strategy into action.

With increasing organization size the significance and strength of performance measurement decreases. According to Tapinos et al. (2005) influence of performance measurement is quite stronger in strategic planning for large organizations. Most performance management paradigms are designed to help address needs in large organizations compared to smaller organizations. Performance measurement is not as effective in small businesses as compared to the larger business organization. Smaller business organization lack proper reference to strategic planning, and their success depends much on entrepreneurial skills and strategies as compared to strategic planning.

Be as it may, small and medium enterprises lack effective and formal feedback system. Therefore, information gathered by performance management may not be effectively employed in strategic planning (Tapinos et al., 2005). Performance management and strategic planning are not linked effectively in a smaller organization as compared to larger organizations. On the flipside, performance measurement is more effective also in a larger organization because of its complexity in nature. Information is collected as feedback based on performance measurement. Large organizations require more information to help in coordinating activities and making decisions that are multilayered in nature between its complicated structures.

With respect to the rapidly changing environment, performance measurement influences strategic planning of organizations that operates in a rapidly changing environment more as compared to organizations in a slowly changing environment. Organizations operating in a competitive sector relies more on performance measurements to develop strategies to gain competitive advantage (Teeratansirikool et al., 2013). Organizations operating in the dynamic environment need to take a careful approach to the effective management of their investments. Performance measurement is imperative to help management develop strategic plans based on the judgment of organization ability through the performance of the employees compared to competitors.

Rapid changes in the business environment imply that organizations need to undergo strategic changes. Evidence shows that performance measurement provides a benchmark for developing strategic changes by providing constant feedback from the business environment. According to Tapinos et al(2005), performance measurement has a greater impact on effectiveness as compared to efficiency in organizations. This tendency is because of the potential challenges arising as a result of bureaucracy and slowing down of business activities (As cited Tapinos et al., 2005).

In conclusion, based on the discussion above, it is evident that performance measurements are paramount when it comes to development and strategic planning in an organization. Performance measurement’s complements strategic planning by providing information necessary and controls that are essential for developing and implementing strategic plans (Tapinos et al., 2015). The impact of performance measurement is greater in large companies as compared to small and medium enterprises. This trend is because of the nature of performance measurement’s paradigms and the nature of the larger organization to process and use feedback from their complex structure.  However, performance measurement is often critical in ensuring that strategic planning and implementation is a success.


Taticchi, P. (2010). Business performance measurement and management: New contents, themes and challenges. Berlin: Springer.

In Osman, I. H., In Anouze, A. L., & In Emrouznejad, A. (2014). Handbook of research on strategic performance management and measurement using data envelopment analysis.

Teeratansirikool, L., Siengthai, S., Badir, Y., & Charoenngam, C. (2013). Competitive strategies and firm performance: the mediating role of performance measurement. International Journal of Productivity and Performance Management62(2), 168-184.

De Waal, A. (2013). Strategic Performance Management: A managerial and behavioral approach. Palgrave Macmillan.

Sena Ferreira, P., Shamsuzzoha, A. H. M., Toscano, C., & Cunha, P. (2012). Framework for performance measurement and management in a collaborative business environment. International Journal of Productivity and Performance Management61(6), 672-690.

  1. Tapinos R.G. Dyson M. Meadows, (2005),”The impact of performance measurement in strategic planning”, International Journal of Productivity and Performance Management, Vol. 54 Iss 5/6 pp. 370 – 384. Retrieved form

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