ABSTRACT

This chapter describes second step of the systematic improvement planning (SIP) pattern: clarifying improvement targets. After determining the status of the business, financial and measurable-quantitative operational improvement targets need to be set. The following types of questions should be answered in this step: What do we want to achieve, how should targets be distributed within the organization and by which data can we describe the targets. Targets should be: achievable, realistic, motivating, challenging, specific and integrative, defined in a timely manner and measurable. For example, a business financial target can be set by considering its low profitability against the competition and/or a business may need an ambitious Earnings Before Interest & Tax (EBIT) target by considering its status. Then, the business financial target should be converted into a total operational improvement target that then should be broken down into organizational units.