Integrated vision, strategy, activities (VSA) management is the next generation of the “management by objectives (MBO)”.
VSA is the organisational vision and strategy alignment scheme to define log term vision, mid term strategy and short term critical activities.
This is realising every single member of organisation focusing on the critical activities derived from strategy and vision.
The future value proposition in the five year from now
Strategy to realise the vision defined. Strategy is three to four years major activities needed.
Critical activities which should be performed in the next one to two years in order to realise the vision. KPI would be needed to evaluate the critical activities(CSFs).
Improvement opportunities in the Traditional quantitative performance management(BSC、KPI)：
・Too focus on the quantitative management
Traditional balanced score card systems have been focusing on the complex quantitative metrics. It has been misleading the employees to focus on the metrics. It drives motivation without alignment. They should have been focus on the critical activities.
・Complicated updating procedures
BSC needs to be updated, when the organisation changed structure, strategy, business etc. The organisation needs to change the metrics, but the updating workloads are big.
・Performance based on the BSC
According to the research done by Marc Kodak, “The 67 companies in the S&P 500 that used revenue as a main driver of bonuses in 2002 to 2004 grew their sales about 7 percentage points faster than their peers over that period, but underperformed by 3.7 percentage points per year in total shareholder returns. Profitability is related to revenue, but the opposite is not necessarily true. Paying for, and getting, revenue or sales growth is a good example of motivation for managers without alignment with the shareholders.”
Improvement opportunities of the Traditional Management by Policy：
Many companies have vision, but these vision sates the way they are doing. The organisation needs to have clear vision which describes customer value proposition.
・Observation and Orientation
In the networked economy, the organisation needs to have a strong sense making capabilities, which observe market and technology trends and change and position themselves.
Goal setting, performance management, development and rewards：
The VSA needs to be applied based on the GPDR (Goal setting, performance management, development and rewards) system.
The VSA and GPDR systems have been implemented in the leading edge organisations and made big improvements in collaborations and performance.
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