Page 240 - Performance Leadership

Chapter 12 Performance Networks • 229

F igur e 12.4
Graphical Representation of Performance Prism

Regulator Legal, fair, Return, reward, Investors
safe, true figures, faith
Rules, reason, Capital, credit
clarity, advice risk, support
Profit, growth,
opinion, trust
Fast, right
cheap, easy
Suppliers/ Customer/
Partners Organization Supplier Consumer
Profit, growth, Profit, growth,
opinion, trust opinion, trust
Fast, right, Fast, right,
cheap, easy cheap, easy

Image, skills, Hands, hearts,
suppliers, support minds, voices
Job, fidelity, Purpose, care,
integrity, wealth skills, pay
Community Employees

regulators and investors supply the means to propel value creation,
thereby making it possible. Regulators ensure fair competition; the com-
munity provides a platform to work in, such as infrastructure; investors
supply the necessary capital to operate; and employees provide the
needed labor. With this view in mind, it is quite clear that none of the
stakeholders can be ignored, as each represents a vital component in
making the value chain flow smoothly. Traditional performance man-
agement usually aims at optimizing results for the shareholders. But if
you follow this visualization, it also is immediately clear that investors are
not the central stakeholder in a networked business model. Managing
customer-supplier relationships is central. Optimization for investors
alone will disrupt the reciprocity of good stakeholder relationships.
Reciprocity is even important within transactional relationships. Com-
panies need to track what is important for their stakeholders, to make
sure they are still on the right track. Failure to do so will lead to a reduced
level of stakeholder satisfaction and, where switching costs are relatively
low, to outright stakeholder defection. However, measuring what is
important to the stakeholder is done with a focus on optimizing one’s
own performance toward the stakeholder.