Advanced Performance Management · Non-financial performance measurement

Performance Prism and Other Performance Frameworks

Updated 11 October 2026 · Fact-checked

The Performance Prism is a stakeholder-based framework. It starts with what each stakeholder wants and contributes, then links strategies, processes and capabilities to those needs. Fitzgerald and Moon's Results and Determinants and Cross and Lynch's Performance Pyramid are other frameworks. You solve questions by applying the framework to the scenario.

Understand Performance Prism and Other Frameworks

Traditional measures look inward at profit. Modern frameworks ask a wider question: what must the organisation get right, for whom, and how will it know? The frameworks in this topic give you a structure to answer that.

The Performance Prism (Neely, Adams and Kennerley) has five facets. Think of it as a prism with five faces. Stakeholder satisfaction: who are the key stakeholders and what do they want? Stakeholder contribution: what does the organisation need from them, such as capital, loyalty, effort or supply? Strategies: what strategies deliver that satisfaction? Processes: what processes are needed to deliver the strategies? Capabilities: what people, practices, technology and infrastructure do the processes need?

The key idea is that stakeholder wants and contributions are two-way. A firm wants investors' capital, staff effort and customers' loyalty. In return, each wants something back: returns, rewards, good service. You design measures only after you have worked through the facets. Measures follow the strategy, not the other way round.

The Results and Determinants framework (Fitzgerald and Moon) was designed for service businesses. It splits measures into results and determinants. Results are financial performance and competitiveness. Determinants are quality of service, flexibility, resource utilisation and innovation. Determinants are the drivers; results are the outcomes. If results are poor, look at the determinants to find why.

Cross and Lynch's Performance Pyramid links corporate vision at the top to day-to-day operations at the bottom. It has four levels: corporate vision, business units (market and financial measures), business operating systems (customer satisfaction, flexibility, productivity), and departments and work centres (quality, delivery, cycle time, waste). Objectives flow down and measures flow up. It also separates external effectiveness from internal efficiency. Use it to show how operational measures connect to strategy.

Key rules to remember

Performance Prism facets: Stakeholder satisfaction → Strategies → Processes → Capabilities ← Stakeholder contribution; Five facets. Satisfaction and contribution are two-way. Start with stakeholders, not with financial targets.
Results and Determinants: Results = financial performance + competitiveness; Determinants = quality + flexibility + resource utilisation + innovation; Six dimensions in total. Determinants explain and drive the results.
Performance Pyramid levels: Vision → Business units → Business operating systems → Departments and work centres; Objectives flow down; measures flow up. Split measures into external (effectiveness) and internal (efficiency).

How to solve Performance Prism and Other Frameworks questions

Use this method whichever framework the requirement names, or when it asks you to choose one.

1Read the requirement. Note the verb: explain, apply, evaluate, recommend. Note who the answer is for.
2Name the framework in one line and give its structure. Do not write a textbook essay.
3Pull the scenario facts: the stakeholders, the strategy, the problem and the current measures.
4Work through each element of the framework in turn and apply it to those facts.
5Propose specific measures and say why each fits the strategy. Use numbers from the scenario where you can.
6Evaluate. Give at least one benefit and one limitation, such as data cost, vague guidance on weighting or too many measures.
7Conclude with a clear recommendation in the form asked for, for example a short memo.

Quickest way: Five-facet scan for stakeholder questions

When to use it: Use it when time is short and the question gives a list of stakeholders and a strategy.

List the two or three key stakeholders from the scenario.
For each, write one want and one contribution.
Link each want to a strategy and a process in the scenario.
Add one capability needed, such as skills or systems.
Give one measure per line, then close with one limitation.

Common mistakes in Performance Prism and Other Frameworks

Listing the five facets without applying them
Students memorise the model and think naming it earns the marks.
Fix: Spend most of your time on the scenario. Each facet needs a scenario fact and a measure.
Treating stakeholder contribution as the same as satisfaction
Both sound like stakeholder needs.
Fix: Satisfaction is what the stakeholder wants from you. Contribution is what you want from them. Write both.
Confusing results with determinants
Quality and flexibility feel like outcomes.
Fix: Results are financial performance and competitiveness. The other four are determinants, the drivers of results.
Putting only financial measures under stakeholder headings
Habit from ratio analysis.
Fix: Use customer, staff and supplier measures too, for example complaint rates, retention and on-time delivery.
Claiming the Prism or Pyramid is better than the Balanced Scorecard without reasons
Students assume newer means better.
Fix: Compare on stakeholder breadth, cause and effect links and simplicity. State the context in which each suits.
Ignoring limitations and implementation
Students stop once the measures are listed.
Fix: Add a short evaluation: cost, data availability, number of measures and the need for management buy-in.

Worked examples

Example 1

A regional private hospital group wants to use the Performance Prism. Its main stakeholders are patients, doctors and investors. Explain how the group would apply the Prism to patients and suggest two measures. (8 marks style)

Show the solution

Stakeholder satisfaction: patients want safe, timely and affordable care with clear communication.
Stakeholder contribution: the group wants fees, repeat use, referrals and honest feedback.
Strategy: build a reputation for fast, high-quality care to attract paying and insured patients.
Processes: efficient admission, diagnosis, treatment and discharge, with infection control.
Capabilities: skilled clinicians, reliable equipment and an integrated patient record system.
Measures: average waiting time from arrival to consultation (satisfaction and process); percentage of patients who would recommend the hospital (satisfaction and contribution).
Limitation: patient satisfaction is subjective and surveys cost money and may have low response.

Answer: Apply all five facets to patients: wants (safe, timely, affordable care), contributions (fees, loyalty, referrals, feedback), strategy (quality reputation), processes (admission to discharge) and capabilities (clinicians, equipment, systems). Two measures are average waiting time and the percentage of patients who would recommend the hospital. Note the limitation that survey data is subjective.

Example 2

A budget airline reports good profit and load factor but its customer complaints are rising. Using the Results and Determinants framework, explain what this suggests and recommend two determinant measures.

Show the solution

Results: profit and load factor are results, showing financial performance and perhaps competitiveness.
Rising complaints suggest a problem in determinants, especially quality of service.
Determinants are leading indicators. Poor quality may hit future results through lost customers.
Quality measure: complaints per 1,000 passengers, or baggage mishandling rate.
Flexibility or resource utilisation measure: on-time departure percentage, or aircraft turnaround time. Pushing turnaround too hard may harm quality, so balance the two.
Recommend tracking determinants alongside results and setting targets for each.

Answer: Current results look good but weak determinants, mainly service quality, may reduce future results. Add complaints per 1,000 passengers (quality) and on-time departure percentage (flexibility or utilisation). Review them with the results each period so problems show up early.

Exam tips

Always tie the framework to the scenario's stakeholders and strategy. Generic answers score poorly.
Learn the five Prism facets and the six Results and Determinants dimensions well enough to write them under pressure.
When asked to compare frameworks, use a clear criterion for each point, such as stakeholder focus, structure or practical use.
Include a limitation and a practical implementation point to earn evaluation and professional skills marks.
If the requirement is a memo or report, use that format and write to the named reader.

Practice questions from Non-financial performance measurement

Performance Prism and Other Frameworks: frequently asked questions

What are the five facets of the Performance Prism?

They are stakeholder satisfaction, strategies, processes, capabilities and stakeholder contribution. The model starts from what stakeholders want and need, then works through how the organisation delivers and what it needs back.

What is the difference between results and determinants?

Results are the outcomes: financial performance and competitiveness. Determinants are the drivers: quality of service, flexibility, resource utilisation and innovation. Weak determinants usually show up later as weak results.

How is the Performance Prism different from the Balanced Scorecard?

The Prism begins with a wide range of stakeholders and includes what the organisation needs from them. The Balanced Scorecard starts from four fixed perspectives. The Prism is broader but gives less fixed structure.

Do I need to know the Performance Pyramid for APM?

Yes, it is part of the frameworks you should be ready to apply. Know its four levels and the flow of objectives down and measures up.