The profitability of an organisation is directly linked to the continual improvement of business performance. Many organisations have found a way to improve their performance through the establishment of performance measurement systems. The importance of such systems as well as individual performance measures is generally recognised in the literature and the industry. Traditionally, performance measures and indicators have been derived from cost accounting information, often based on outdated and arbitrary principles. These provide little motivation to support attempts to introduce process improvement and, in some cases, actually inhibit continuous improvement because they are unable to map process performance. Additionally, the adequacy of measures applicable to different aspects and processes of an organisation (such as the New Product Introduction process) does not appear to have been addressed.
Finally, vast amounts of work on performance measurement to date lead to monitoring performance and stimulate future action. Increasingly, however, managers are beginning to seek "predictive" measures. These measures should show what is going out of control, before too much damage has been done. The identification and/or development of "predictive performance measures" will prove of a great value to the research and practice of the performance measurement field.