An Introduction to WebFOCUS Performance Management

By Bob Ferrante

You've possibly heard the abbreviations CPM and BPM. Maybe you're heard about them in connection with balanced scorecarding or read about them in a trade magazine.

So what is it? Will it affect you and your job? According to Gartner, Performance Management is "the methodologies, metrics, processes, and systems that monitor and manage the performance of an enterprise."

Performance Management (PM) allows companies to integrate high-level strategy down to the lowest level of the organization and provides a clear, easy-to-read communications tool, or scorecard, that enables employees in each part of the enterprise to see how their work integrates with the overall company strategy.

In a practical sense, PM implements a standardized enterprise reporting system with a well-laid-out development practice that sets a precise recipe on what elements of the business should be measured and what rules should be applied when evaluating these measurements.

Standard PM solutions allow for "perspectives," which divide the overall strategy into separate measuring compartments. Most typically there are four perspectives: financial, customer, internal process, and learning and growth. Although any enterprise is free to use more, or fewer, most follow the standard fairly strictly.

The practice of Performance Management is pretty well-defined. Your company needs to determine its strategy – this is usually done at the corporate management level. Strategy involves looking at the differences that make a difference in how the company generates value in the marketplace and codifying them.

Strategy development is iterative. You posit a strategy, then test it to see if it's correct and complete, and keep modifying it until all the steps in your value chain are brought to light.

Via a tool called Strategy Map, managers link company-wide objectives to the items being measured. Scorecards can also be cascaded from high-to-low levels in the company, lower level cards inheriting their view of the world from the higher-level cards.

Within each perspective, managers and executives set "objectives" for each measurable item that falls within the enterprise's Performance Management solution. Objectives typically impose "targets" (goals) for measures that are specific and time-based. Managers and other system users also can typically add subjective comments that help clarify variances from norms in measures and provide additional rationale and quality control for the information.

A very important step in the practice is Measure Acquisition. That means finding the source for the data to be used in measuring performance. PMF has a unique position here, different from any other solution – measure acquisition is built into the application!

To prepare a company's data for analysis and actionability in a Performance Management solution, it must be loaded into the framework's databases. Performance Management systems must be kept fed with fresh data; this is done through scheduled data feeds, which extract data from the enterprise's operational data stores, perform adjustments, enrichment and weighting.

What is Information Builders Doing About Performance Management?

Introducing a new product, of course! WebFOCUS Performance Management Framework (PMF) is a WebFOCUS application template that runs on a WebFOCUS server (Screen 1). It is a standard WebFOCUS application that takes advantage of many of WebFOCUS' features – tabular and financial reporting, user configuration, document distribution and security.

Screen 1

Role-based access: Functions in PMF are made available to various users via panels that display based on role – executives, managers, knowledge workers, administrators and strategists. Access to the application is controlled by a security logon page. Each ID is assigned with a specific role in the system, as well as the Performance Management practice. Roles control the functionality each user is permitted to have in PMF. The roles are as follows:

	Administrator: Sets up the measure loads from operational data in the enterprise, assigns users to roles, and enters other application-specific data for each site. Also responsible for ongoing maintenance of the solution.
	Strategist/author: Sets up the structure of the scorecard, specifies the measures to be used and links them to the scorecard.
	Executive: A system user who is allowed to view a scorecard, view and comment on his/her own measures and those of his/her staff, and to perform budgeting and forecasting functions.
	Manager: A system user who is allowed to view a scorecard, view and comment on his/her own measures and those of his/her staff, and also to perform budgeting functions.
	Worker: A system user who is allowed to view a scorecard and to view and comment on his/her own measures.

Today page: Each PMF user has a customizable Today page, which typically would show the company's operational scorecard cascaded at the user's management level. Each user's owner record controls what Today page displays for each user.

Fully comment-capable: Measures and objectives allow end users to add comments, to allow clear ad hoc explanations of variances from targets.

Planning, budgeting, and forecasting: PMF has the capability to plug in standard budgeting and forecasting applications. These include those produced by Information Builders (e.g., a budgeting work flow application implemented with the WebFOCUS Excel Connector) or external budgeting/forecasting system (e.g., Acumen). An XML-based API allows you to integrate any forecasting application with WebFOCUS PMF, to allow PMF data to be used in the forecasting tool, and to allow output of completed forecasts into PMF to create targets.

Customizability: Every aspect of WebFOCUS PMF is customizable by developers. All scorecards, screens and forms, the style sheet used, and even the underlying database are built with production WebFOCUS components, and you can use WebFOCUS capabilities to change, revise or extend any part of PMF. For more information, see the WebFOCUS Performance Management Customization Guide.

User-friendly scorecard setup: All work flow for adding, changing and deleting scorecards and scorecard data and input of strategies, objectives, measures, perspectives, and themes is done via user-friendly, Web-based forms.

Powerful analytics: WebFOCUS PMF fully integrates with WebFOCUS Visual Discovery, a robust set of data analysis tools that allow you to mine the rich information in the Performance Management Framework. Visual Discovery's interactive graphs let you drill in, slice and dice to discover what's causing problems, or to uncover opportunities.

Thin-client strategy map: Unlike many rival systems, WebFOCUS PMF comes with a built-in interactive strategy map. Based on industry-standard JavaScript, the strategy map has a live relationship to underlying scorecards and data and allows you to "save" your changes to the underlying scorecard, thus giving you an easy-to-use graphical method for updating your company's strategic flow.

Multidimensional data: WebFOCUS PMF has a built-in, cross platform OLAP database that can be installed and used on any RDBMS. The database permits assigning measures into relationships with standard dimension types (location, product, customer, time). Future versions will permit up to eight additional user-defined dimensions.

Loading data: WebFOCUS PMF's built-in dimension and measure loaders allow you to design your data loads and feeds for PMF using the flexible, powerful data extraction features built into WebFOCUS. Scheduling your loads and feeds is also an automated process.

Scorecard inheritance: WebFOCUS PMF lets you "cascade" your scorecards so that you can create a top-level scorecard for high-level management, then let your scorecards for other levels of the company hierarchy "inherit" one or more aspects of management's scorecard.

Standard analysis reports: WebFOCUS PMF comes prepackaged with a set of financial/user/ customer/location/time and trend reports that allow you to be instantly productive with the solution the day it is rolled out. Of course, WebFOCUS's powerful ad hoc reporting capability means you can also create any other reports you need.

You'll be hearing a lot more about this at the Summit 2004 User Conference in May in New Orleans, but remember, you heard it here first.