1BackgroundOurclient,a$15billionlocalexchangecarrier,hasengagedAA&Co.toassistthemindevelopinganintegratedperformancemanagementprocessfortheirtelecommunicationsbusinessunits.Ourworkwillincludeidentifyingcriticalmeasuresforthetotaltelecommunicationsorganization,aswellasmeasuresfordefinedbusinessprocesses,specificallythemaintenanceprocess.Inourinitialdiscussionsaboutthisproject,theclientstressedtheneedformeasurestobe“linked”throughoutdifferentlevelsoftheorganization,aswellasprovidingameanstoassessprogresstowardachievingitskeystrategies.2TheCompanyhasdevelopedareportingsystemoveritshistorywhichincludesavarietyofmeasuresthattheyhavetraditionallytrackedtomeetregulatoryandmanagementinformationneeds.Topmanagementfeelsthattheyreceiveaninordinatenumberofmeasures,andareunabletodeterminethetruedriversofthebusiness.TheyhavevoicedconcernthatmiddleandlowermanagementspendtoomuchtimeaccumulatinganddevelopingmeasurementdatathatarenotrelevanttotheCompany’sbusinessstrategiesandmaynotbecriticaltothesuccessofthebusiness.Theorganizationcurrentlyhasanincentivecompensationplanbasedon“teammeasures”relatedtooverallachievementofReturnonInvestmentgoals.Background3November30,1994Mr.JohnSmithVicePresident-QualityAssuranceXYZTelephoneOperations1MainStreetChicago,IllinoisDearJohn:Thisletterconfirmsourunderstanding,basedonconversationswithyou,oftheassistancerequiredbyXYZTelephoneOperationsinthecreationofintegratedperformanceinformationforthetotalcompanyandthemaintenanceprocess.Thislettercoverstheworktobeperformedduringthefirsttwophasesoftheprocess--performanceinformationidentificationandbaselining.Ourassistanceforthefinaltwophasesofimplementationandintegrationoftheperformanceinformationwillbecoveredinaseparatejobarrangementletteratthecompletionofphase2.Thisletterdiscussestheprojectobjectives,scopeandstaffingforphases1and2.Theprojecttimingandestimatedcostisdiscussedforbothphasesinthelastsectionoftheletter.A.PhaseI--IdentificationofPerformanceInformationDuringthefirstphaseofourproject,wewillfacilitatefocusgroupdiscussionswithtopmanagement,keystakeholdersandprocessownersandmanagementofkeyfunctionswithinthemaintenanceprocess.Startingwithtopmanagement,wewillgainanunderstandingofthekeystrategies,currentperformanceinformation,theperceivedperformanceinformationneedsandthegoalswhichmanagementhasinrelationtothestrategies.Thesecondsetofmeetingswillfocusontheinternalstrategiesoftheprocessesandhowtheselinktotheoverallcompanygoals,thecurrentperformanceinformationandneededperformanceinformationfortheprocessandrelatedfunctions.JobArrangementLetter4Thedeliverablesthatwillbeprovidedtoyouatthecompletionofthisphaseofworkinclude:1.DraftBalancedScorecardofperformanceinformationwhichislinkedtocorporatestrategies.2.Lexiconofperformancemeasures.WeanticipatePhaseItobecompletedoverasixweekperiodbyastaffofthreeArthurAndersenconsultantsandtwoXYZmanagers.B.Phase2--BaseliningofPerformanceInformationAcontinuationofPhaseI,theprimaryobjectiveofPhase2istoassistinthevalidationoftheperformanceinformationidentifiedasbeingcriticaltothecompanyandlinkedtothestrategicobjectives.Alsoduringthisphase,wewouldbedevelopingthebaselinevaluesforthedefinedperformanceinformation.WewillbeutilizingavaluedrivermodeltoillustratethelinkagefromtheperformanceinformationatanoverallTelephoneOperationslevelthroughtheprocessestothefunctionallevels.Asweunderstan...
