Performance Measurement Systems: : How to measure improvements in a value stream

University essay from KTH/Industriell produktion

Author: Anna Hålén; Carin Gerok; [2014]

Keywords: ;

Abstract:

Increasing efficiency in organisations and processes during the latest years has made the competition among companies tougher. To increase the efficiency the organisations have to analyse their processes and by doing that, gaps and bottlenecks can be found. Value stream mapping is a common method used when organisations are analysing their processes. Furthermore, in order for organisations to maintain competitive performance measurement systems can be used. Balanced scorecard is a performance measurement system model commonly used for this purpose. Additionally to an extensive literature research a case study at AstraZeneca has been conducted to get valuable in-depth knowledge. AstraZeneca was chosen since they must continuously improve their organisation and internal processes in order to maintain the position of being one of the world’s leading biopharmaceutical companies. The internal artwork process has been examined and served as a base for answering the research question. The purpose of the master thesis is to deepen the knowledge about how performance measurement system can be used to increase the efficiency within organisations. By the purpose stated the main research question to be investigated is: How is performance measurement system used to improve the value stream of artwork in a pharmaceutical company? The master thesis resulted in important conclusions being made. To start with, in order to develop and improve the value stream of the artwork process, third-generation balanced scorecard is to be used. Gaps and bottlenecks within the artwork process occurred partly due to lack of communication between employees. The third-generation balanced scorecard stresses the fact of using a two-way communication to visualise the organisation’s strategy resulting in a more efficient process. The fact that using a performance measurement system is not a one-time effort but should be used continuously to experience performance is also an important conclusion being made. The empirical contributionfrom this master thesis is the fact that in order to ensure the two-way communication a person responsible for the entire process at an operational level is needed. This person, the owner of the process/the sponsor, will make sure that the process’ vision and goals align with the organisation’s overall strategy as well as facilitate and ensure a two-way communication. Moreover, the master thesis resulted in recommendations regarding how AstraZeneca should work to improve their artwork process. Due to confidential information these recommendations are shown to AstraZeneca only and is not included in the published master thesis.

Keywords: Performance management, performance measurement system, balanced scorecard, artwork, value stream, gap-analysis, bottleneck

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