Performance Measures & Responsibility – Essay Example

Performance measures are necessary as they serve as a benchmark against which the progress of each department can be measured. They are also necessary to judge the departments’ efficacy in the overall scheme of things and evaluate whether the cost incurred by the company on the particular department is worth it from a cost-benefit point of view. Performance measures of the people in the company also serve as milestones against which they can be assessed.
The responsibility of ensuring that performance measures are assigned to specific managers and supervisors is to ensure that these people keep a check on the progress on the department as well as the people staffing the departments in order to evaluate their usefulness to the company. Further, the employee pay and bonuses can be determined according to the progress on the performance measures and the supervisors and managers can help to evaluate the results against the goals.
The typical metrics for the purchasing departments would be the number of days the inventories are kept in stock and the time period for which the pending invoices are cleared. For instance, if the inventories are managed in a JIT or Just-In-Time manner, then it would be a measure of efficiency on the part of the purchasing department. For manufacturing departments, the metrics would be the number of units manufactured as well as quality measures like how many defects were found for a given sample of units. These measures can be also be accentuated with other measures.
The managers of supervisors when presented with adverse results must immediately take action to prevent the metrics from falling further and ensure that the performance of the departments is up to the mark. This can be done by introducing stricter measures as far as the working of the department is concerned.
Lawler, E.E. (1971) Pay and Organizational Effectiveness. A Psychological View. New York:
Miles, R.E. and Snow, C.C. (1978) Organizational Strategy, Strategy and Process. New York: