Development of an extended enterprise performance measurement system

Abstract

This paper discusses the development of a performance measurement system specifically designed for the requirements of the extended enterprise, via two performance measurement frameworks: the structural extended enterprise balanced scorecard and the procedural framework for the selection and implementation of measures. The extended enterprise balanced scorecard offers a four-perspective framework, implemented at each node, that provides a generic structure for the management of performance measures in the extended enterprise; while the procedural framework operates at both the local and holistic levels, to provide a step-by-step generic process towards performance measure selection and implementation. When combined, the two frameworks produce the basic extended enterprise performance measurement (EEPM) system, which was subsequently tested at a first-tier supplier in the European automotive industry. The characteristics of the extended enterprise are taken as a given starting point, and the paper concludes by pointing out the need for extended enterprise performance management to balance the developments outlined here.

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