Efficient resource management is vital for organisational success. In today’s competitive landscape, simply managing resources isn’t enough — they must align with strategic goals. Integrated Performance Management (IPM) is a holistic framework that optimises resource allocation, drives performance and ensures sustainable growth by linking operations with strategy.
From siloed to strategic management
Traditional resource management often operates in silos, with budgets based on historical data or departmental entitlements. This reactive approach leads to inefficiencies and misaligned priorities.
IPM shifts this paradigm. It replaces static annual budgeting with dynamic, ongoing resource allocation driven by leadership and stakeholder collaboration. Strategic executive officers (SEOs) play a key role, ensuring budgets align with productivity measures, strategic targets and value creation.
The IPM maturity model
The IPM maturity model provides a structured framework for organisations to assess and improve their resource management practices. This model is particularly valuable for organisations transitioning from traditional, siloed resource management to a more integrated and strategic approach. The maturity model outlines four stages of development: traditional, evolving, advanced, and integrated. Each stage represents a progression in how resources are managed.
Traditional stage: Budgets are often based on prior-year amounts, with little consideration for strategic alignment. This approach can lead to inefficiencies, because resources may be allocated to areas that no longer contribute to the organisation’s strategic goals.
Evolving stage: Organisations begin to shift towards a more strategic approach to resource management. Budgets are driven by a goal-cascading process, where functional activities are reconciled with strategic objectives. However, functional primacy still prevails, and resource allocation may not fully align with strategic priorities.
Advanced stage: A balance between functional excellence and strategic priorities is achieved. Budget processes reflect an increased emphasis on value creation and innovation. Resource allocation is more dynamic, with a focus on initiatives that drive strategic outcomes. However, there is still room for improvement in terms of integrating resource management with strategic objectives.
Integrated stage: Resource management is fully integrated with strategic objectives. Operating and capital budgets are determined through continuous conversations with SEOs, based on productivity measures and targets. Resources are allocated where they will have the greatest impact on achieving strategic outcomes.
The initiative attributes table
One of the most powerful tools within the IPM framework is the initiative attributes table. This tool enables organisations to monitor and report on the progress of strategic initiatives, ensuring that resources are used effectively and that risks are managed proactively.
The table includes a range of attributes, such as the initiative’s name, narrative, values statement, strategic alignment, owner, and financial metrics (e.g., cost, revenue and ROI). By tracking these attributes, organisations can maintain transparency and accountability, while also facilitating better forecasting and risk management.
For instance, consider an organisation implementing a new financial software system. The initiative attributes table would help track not only the costs and revenue implications but also the risks associated with the project and the strategies in place to mitigate those risks. This structured approach ensures that resources are allocated optimally, risks are managed effectively and strategic goals are achieved.
Additionally, the table supports continuous performance commentary, providing a narrative that explains performance for each accounting period. This commentary is reviewed by initiative owners and other stakeholders, fostering a culture of accountability and continuous improvement.
Conclusion
IPM redefines resource management by aligning it with strategy. Through tools like the maturity model and initiative attributes table, organisations foster transparency, accountability and growth. In a dynamic business world, IPM unlocks resource potential, driving long-term success.
Integrated Performance Management resources:
AICPA & CIMA and World Business Council for Sustainable Development, Primer on Integrated Performance Management
Our Integrated Performance Management report and executive summary are available in five additional languages.