Performance Measurement (DLMBPM01)

Course No.:


Course Title:

Performance Measurement

Hours Total:

150 h

Credit Points:


Course Type: Pflicht

Course Availability: WS, SS

Course Duration: 1 Semester

Admission Requirements:


Course Coordinator / Instructor:

See current list of tutors in the Learning Management System

References to Other Modules:

Please see module description

Course Description:

After specifying a company’s strategic goals, managers face the challenge to implement these strategies. Performance measurement and performance management support the implementation of strategy by using performance measures to address financial and non-financial/operational aspects. Consequently, students get to know the function of performance measurement and performance management as part of the overall management functions. Furthermore, they will acquire an understanding of various performance aspects (e.g. financial drivers measured by the economic value added, customer drivers measured and managed by customer lifetime value, process drivers measured and managed in the context of continuous improvement programs). Understanding financial performance measurement concepts is especially crucial before students go on to identify operational drivers.

Course Objectives and Outcome:

On successful completion of this course, students will be able to:

  • Describe the history of performance measurement theory and its influence of present-day understanding of performance measurement.
  • Report on a business’s financial performance using accounting calculations (such as return on equity, return on assets, return on investment, earnings per share, gross profit margin, etc.) and market-based calculations (such as price-to-earnings ratio, net present value, internal rate of return, etc.).
  • Explain the economic value added (EVA) model and calculate this metric using data from the company.
  • Identify, define, and track drivers of operational performance, specifically quality, dependability, speed, cost, and flexibility.
  • Derive performance metrics, such as customer satisfaction or sales forecast-to-plan performance, and link these with overall performance targets to create a performance measurement system.
  • Conduct a customer profitability analysis using activity-based costing and calculate customer lifetime value using company data.
  • Summarize strategies for benchmarking and measuring intellectual capital.
  • Measuring organizational performance using the following tools: Balanced Scorecard, the EFQM Excellence Model, the Performance Prism and the SMART Pyramid approach.
  • Evaluate the strengths and weaknesses of different performance measurement metrics and frameworks.

Teaching Methods:

A variety of learning materials are offered to students: depending on the course, these include printed and online course books, vodcasts, podcasts, online tutorials, case studies, and online knowledge tests. This range of learning materials is offered to students so they can study at a time, place, and pace that best suits their circumstances and individual learning style.

Course Content:

1 Performance Measurement as Part of the Overall Management Framework

1.1 Theories Before 1950

1.2 Theories After 1950

2 Measuring Financial Performance

2.1 Reviewing Traditional Models of Financial Performance Measurement

2.2 The Economic Value Added (EVA) Metric

3 Drivers of Operational Performance

3.1 The Five Operations Performance Objectives

3.2 Analysis of Performance Drivers

4 Customer Profitability Analysis, Lifetime Value, and Benchmarking

4.1 Profitability Analysis

4.2 Customer Lifetime Value

4.3 Benchmarking

5 Intellectual Capital Measurement and Management

5.1 Importance and Challenges of Intellectual Capital Measurement

5.2 Approaches of Managing and Measuring Intellectual Capital

6 Performance Measurement Concepts

6.1 Objectives of Performance Measurement Systems

6.2 The Balanced Scorecard

6.3 Performance Prism and SMART Pyramid

6.4 European Foundation for Quality Management (EFQM)

7 Common Characteristics of Different Concepts

7.1 Common Characteristics of Different Concepts

7.2 Pitfalls in Performance Measurement and Management


• Bible, L., Kerr, S., & Zanini, M. (2006). The balanced scorecard: Here and back. Management Accounting Quarterly, 7(4), 18–23.
• Hammer, M. (2004). Deep change: How operational innovation can transform your company. Harvard Business Review, 85(4), 85–93.
• Ittner, C. D., & Larcker, D. F. (2003). Coming up short on non-financial performance measurement. Harvard Business Review, 84(11), 88–95.
• Kaplan, R. S., & Norton, D. P. (2008). Mastering the management system. Harvard Business Review, 89(1), 63–77.
• Kumar, V., & Rajan, B. (2009). Profitable customer management: Measuring and maximizing customer lifetime value. Management Accounting Quarterly, 10(3), 1–18.
• Neely, A. (Ed.). (2007). Business performance measurement: Theory and practice (2nd ed.). Cambridge, MA: Cambridge University Press.
• Speckbacher, G., Bischof, J., & Pfeifer, T. (2003). A descriptive analysis on the implementation of balanced scorecards in German-speaking countries. Management Accounting Research, 14(4), 361–387.
• Simons, R. (2000). Performance measurement and control systems for implementing strategy: Text and Cases (International edition). Upper Saddle River, NJ: Prentice Hall.
• Young, D. S., & O’Byrne, S. F. (2001). EVA and value-based management: A practical guide to implementation. New York, NY: McGraw Hill.

Prerequisites to Qualify for Assessment:

• Depending on the course: Completion of online knowledge tests (approx. 15 minutes per unit, pass / not pass)
• Course evaluation


Exam, 90 min

Student Workload (in hours): 150

Self-study: 90
Self-testing: 30
Tutorials: 30