Sustainable Solutions for SCM

• Thirdly, the acceptance of the PMMS by the users [3] is ultimately important because only then the prerequisite for generating impact with the PMMS is fulfilled. Therefore, it has to be defined who the users are. Possible users could be the responsible top, middle or lower managers or other stakeholders such as staff that is gathering data or customers. All their concerns should be looked at. A major factor that is leading to a higher acceptance by users is that the users are actively involved in the process of creating the performance measurement system [17]. Only then they feel that they can actively influence the PMMS. Also giving feedback on the recorded data and the calculated KPIs as well as possible actions to be taken to ensure a high rate of acceptance might be taken into account. • Fourthly, an appropriate reporting or representation of the performance helps to create acceptance of users. Examples are graphical representations of the main KPIs on the shop floor. In the sense of the third aspect the implementation of a PMMS can be seen – as any change in an organisation – as a change process and thus should be supported by a change management process. An example can be seen in the change management process of Kotter’s eight-step approach [31]. Action orientation, usefulness and economy Ultimately the purpose of a PMMS should be to stimulate action and thus impact on the organisation it is used in or put simply to be useful [41]. This guideline is mentioned among the guidelines for the management process as it is based on the effect- mechanisms within the process and a reliable measuring process as well as the acceptance of the users. Only if the above mentioned guidelines are fulfilled to a satisfactory level is the PMMS able to induce change. A trap for PMMS is the creation of a data graveyard, which is neither read, observed nor taken into account when making decisions. Therefore, the economy of the system has to be discussed. In general, this requires that the cost of gathering information and generating the report should be in a favourable relation to the effect of the system [10]. This includes several aspects: firstly, the cost of gathering information should be kept as low as possible (see: availability of information). Secondly, a maximum number of reported performance elements should be observed (as many as necessary as few as possible). For performance measurement systems a number of maximum 20 KPIs can be viewed as a rule of thumb. Thirdly – and this is the link to action orientation – for each indicator and for the whole PMMS, the degree to which the indicators help to explain the cause-and-effect-mechanisms and measure the outcome for the focal organisation should be estimated. Indicators could be how critical for the long and short term success the indicators are. When regarding the size of an organisation, this means that usually bigger organisations can use more KPIs and more sophisticated tools because the expected contribution in terms of savings or expected sales is higher whereas smaller organisations might have to concentrate on single aspects and less detailed data. Another aspect that is especially linked to PMMS for supply chains is the fact that often the responsibility for the whole supply chain is often distributed over several organisational units if not even over several economically independent entities. Thus

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