Paper Example on Key Processes Needed for DSM's KSF Link: Rationale Included

1. Using the stages from the performance management process, suggest the key processes that DSM needs to provide within its system in order to successfully link its key success factors (KSF). Provide a rationale for your suggestions.

Dutch State Mines (DSM) was state owned company which was found in 1902. The company has evolved to a commodity chemicals business company from a petrochemical company. Eventually, it is an established specialties company. The company is approximated at a net worth of $9billion and is actively involved in the health, nutrition as well as materials. In the early 90s, the company embraced a traditional strategic planning process which entailed planning along with budgeting cycles. However, changes in the technology and the market advancements due to time called for a revamp of the planning process. In this light, the company noted the low quality in the strategic development plan with unclear connection between strategy and the performance. Business Strategy Dialogue was therefore introduced to improve and enhance quality of the strategy development process. Therefore, the Corporate Strategy Dialogue was formed which proposed the improvement of the processes of the Corporate development. This came as part of initiative of the company stated as Vision 2005: Focus and Value.

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In this light, effective management process establishes the link between the strategies deployed by the organization and the targeted organizational goals with individual and team performances (Bloemhof, 2004). The team and individual performance enhance the effectiveness of the organization by promoting the profitability of the organization. Various fundamental processes can therefore be applied by DSM in the current system to facilitate proper connection of the organization's KSFs. The applicable processes include planning, execution, analysis of collected information, review of performance and renewal and contracting processes (iATS, 2016).

Planning aids in linking DSM's KSFs and it involves employees deciding on the progress of the processes. Therefore, small and achievable goals and objectives should be defined as well as decisions on the resources to be dedicated to particular objectives. (iATS, 2016) In addition, decision need to be made on the resources which are not essential can be abandoned. Execution involves putting in action the planned objectives. Therefore, by applying the observation and recording strategy, DSM can document the progress of the implementation process. Modification of the strategies or processes can also be effected to boost efficient operation of the processes. Analysis of the collected information aid in the preparation of information that can be distributed to employees based on the progress (iATS, 2016). This involves what is achieved and what is ineffectively handled. The information prepared gives room for evaluation of the performance of the organization with respect to the input of the employees (iATS, 2016). Performance review facilitates an effective evaluation of the performance of the organization based on the goals and objectives met. This provides information on which processes to improve and which to motivate. Renewal and re-contacting reflect on information on other processes to derive the information that provides an insight on setting realistic goals for reviews in the future.

Therefore, reflecting on DSM case study, it can be stated that the company has effectively applied the processes involved in performance management. The approach deployed by the company of business strategy development can be deemed successful based on the embracement of the planning process, implementation, analysis of the progress and reviewing of the success rate (iATS, 2016). The organization took into consideration the processes which were becoming outdated and reviewed and analyzed information with respect to the organization's goals and objectives. The analysis of the old and outdated strategies and the review of the processes took a few years with step by step facilitation of the process by the company. The process of implementation also took various stages over a period of six years ranging from the year 1994 to 2000. The assessment of the business structure was carried out at both macro and micro levels by ensuring the effectiveness of the new process in improving the organizational performance in diverse sections. In this light, all groups in the business took part in the Annual Strategic Review and presented a BSD implementation progress, reassessment and update on the major business risks along with analysis of the sensitivity of the process with the financial projections. (iATS, 2016)

2. Select three drivers and examine the central manner in which DSM management has aligned its business strategies to performance management.

The success of the strategic implementation of DSM is factored by effective alignment of performance management to the business strategies. Various drivers distinctively aid in distinguishing the alignments with diverse organizations. DSM had difficulties in translating vision and strategy into clear, understandable and comprehensive measures as well as goals. Therefore, in addressing alignment, DSM presented Vision 2005: Focus and Value under which the company targeted three business aspects to facilitate the alignment process (Bloemhof, 2004). The aspects included financial control accountability, development of guarantee for performance through the process of strategic business planning and introduction of financial operational metrics . The three aspects enable DSM to establish a measure for internal value creation that is easily incorporated into the group levels of the business as well as the lower levels (Bloemhof, 2004). The other challenge was marked by the rigidity in acceptance of the vision along with the strategy and the goals by the implementation team. However, the challenge was addressed by the creation of Strategic Value Contracts (SVCs) which initiated the strategy to all relevant parties in the organization. Incorporation of incentives toto boost employees' morale in deployment and development of the significant capabilities in achievement of organizational goals also contributed to the improvement of DSM. This followed an introduction of a small incentive of 20-30% in addition to the base salary. The compensation of the executive was associated with personal targets and the measures of financial performance (Bloemhof, 2004). In addition to the existent management option scheme, a personnel share scheme was introduced.

3. Critique or defend DSM's competitive advantage by using three of the six assessment points from the textbook. Justify your response.

The evaluation of an organization's management system performance is enhanced by assessment points that facilitate an in-depth evaluation of the systems. The assessment points help in the process of analyzing the baseline measure of the performance of the management behaviors and cite what needs to be emphasized during the training stage in the performance management system. In this case, DSM successfully gathered underlying information with regards to the current status and the needs of the organization in driving towards the new goals and objectives. DSM comprehensively studied the situation and exploited all the possible options applicable to the business over the forthcoming years. A new strategy approach was created by the company within nine months but used the same approach over a period of six years in different phases. The accountability of the employees was held by the use of the programs and policies which also promoted compliance with the business strategy (Bloemhof, 2004). The introduction of the new incentive associated with performance also promoted compliance to the strategy. The assessment of the training session implemented at the reaction and learning levels played a role in embracing of the new business strategy. However, at the reaction level, DSM could have embraced a more detailed training evaluation. The introduction of SVCs enabled DSM to overcome challenges related to new strategy implementation by fostering accountability in implementation and monitoring of BSD process.

References

Bloemhof, M. (2004). Strategy and performance management at DSM. Retrieved from http://content.xanedu.com/cases/insead/5165.pdf?ID=0.00951426716438064i

ATS, p. (2016). Five Stages of Performance management,Retrieved from http://home.iatspayments.com/industry-news/online-donations/five-stages-performance-management