PERC is an operational improvement methodology designed to facilitate rapid and ongoing performance improvements across peer groups. Using commonly accepted performance metrics and market competition to drive process improvements, PERC endeavors to jump start innovation throughout all levels of an organization simultaneously.
PERC can be applied to individuals, teams, business units, companies, cities, countries, or any other organizational form, as long as there is a common degree of similarity between comparative units. The basic theory behind PERC relies on the following two fundamental principals:
- “Effective” performance operations can be analytically distinguished from “less effective” performance operations using reliable methods of unbiased statistical analysis that is acceptable to all and which can be regularly updated and monitored over time; and
- Everyone within an organization prefers playing for a “winning team” rather than a “losing team”.
The objective behind PERC is to improve performance throughout an organization, using both internal and external organizational indicators in a feedback loop that provides a way to monitor progress towards goals over time.
PERC can be viewed as having three phases in its application: (1) an Endorsement & Evaluation Phase; (2) an Analytical & Scoring Phase; and (3) a Feedback & Learning Phase.
PERC is performance oriented and does not try to reengineer existing business processes, but instead challenges managers to use a “report card mechanism” to make good decisions as to where efforts should be allocated. It also relies upon a natural preference for individuals to be evaluated with clear feedback and rewarded quickly and fairly for their efforts large and small.
PERC is distinct from other analytical performance methodologies such as Six Sigma or Process Reengineering that focus on just one specific process or output and/or attempt to replicate one single “best practice” among dozens of similar entities.
Just like Quality Assurance, PERC is free or a profit center if applied correctly. Proven in practice, PERC has a wide applicability and deserves to be a standard management practice for process improvements.
For more information regarding PERC read: (1) our 2010 submission to the WIPRO-Knowledge@Wharton Innovation Tournament; or (2) view the PERC Powerpoint Presentation that breaks down PERC into more detail and explains PERC as an eight-step process and how it can be readily implemented: