Page 120 - Design for Environment A Guide to Sustainable Product Development

Performance Indicators and Metrics 99

to move beyond compliance and embrace corporate responsibility,
not just because of external pressures, but also because it is in the in -
terests of their owners and shareholders. In particular, environmental
sustainability has become a key factor in long-term competitiveness.
And for those companies that commit to sustainability principles and
wish to integrate them into their business practices, it is essential to
have an effective and credible performance measurement system. As
illustrated in Figure 7.1, there are three important facets of perfor-
mance measurement in the context of product life-cycle management:
1. Measuring continuous improvement in performance
over time
2. Communicating with customers and stakeholders about
product advantages
3. Benchmarking of performance among comparable
products and processes
Since measurement is an act of communication, companies should
strive for clarity in both the purpose and meaning of this communica-
tion. In selecting performance metrics for product development, they
should ask the following types of questions:
• Clarity of purpose—Who is the intended audience, and why
are we communicating with them? Are we providing infor-
mation to customers that will sway their purchase decision?
Are we reporting to external stakeholders in order to demon-
strate environmental leadership? Are we developing internal
insights to guide material, technology, or process selection? Or,
are we seeking to benchmark our performance with respect to
competing products or similar processes in other industries?
• Clarity of meaning—What do the selected performance in -
dicators and results signify to the audience? What is the
intended message? Are the results relevant to the interests of
the audience? Are the results expressed in transparent and

FIGURE 7.1 Facets
of performance
measurement.