On ‘Value’ and ‘Performance’

This article reminds readers that the terms ‘value’ and ‘performance’ are used so routinely that we risk losing sight of their meanings, which results in a risk that Value Measurement and Performance Management become confused. A basic definition of value is provided—benefits minus costs—and discussed, making the point that tangible (rational) and intangible (emotional and social) issues must be taken into account. The work of Jean Baudrillard is referenced to help explain some of the complexity around buying value perceptions and decisions. A four-step process is outlined to help readers develop value assessments in a business context: (a) Value Hypotheses; (b) Sources of Value Flowcharts; (c) Value Word Equations; and (d) Value Models. An established means used by medics to evaluate pain is referenced to demonstrate the measurement of intangible factors. The information is then put into context with performance: What is Performance Management? And what does it mean for the multiple trade-offs that every business has to make every day? The article concludes with a summary and suggested action steps.