The Terminology We Use
The core terminology we use in this programme is designed to be specific in their application so that they can be also used as tools to help our members through the iterative process.
As you will see in the next section, this precise terminology is augmented by the use of other specific tools such as Scenario Planning, the Balanced Scorecard and SIX SIGMA principles in our assessments.
The following are some of the key terminology we use in this programme and their applications:
1. What is a “Benchmark”?
A relevant strategic intent, performance or process indicator in a business that can provide a reference point for other similar businesses to validate their own performance relative to the same.
Some important characteristics:
- All benchmarks are relative
- All benchmarks evolve over time
- There is no one benchmark for any one activity
- Benchmarks are only comparative not determinant
2. What is an “(Indicative) Best Practice”?
A technique, method, process, activity, incentive or reward that has been proven to be the most effective in delivering a particular outcome to achieve a similar business objective.
As it is often difficult to determine “a single” best practice given the dynamic nature of business today, The Asian Banker uses the idea of an “indicative best practice”
Best practices are constantly modified by competition, technology and new methodologies and need to be updated constantly
3. “The Questions We Ask”
Users of our programme will discover that for every business line, activity or process we scrutinize, we design and constantly edit a standard set of basic questions specific to each area. The questions are designed to help our own researchers understand the elements and the key drivers of that business immediately. It is also designed for our members to contribute to additional questions that may be pertinent to develop a proper and accurate understanding of the areas. The “Questions We Ask” for each area are updated regularly based on feedback and a development of our own understanding of the important elements.
A sample “The Questions We Ask” template
4. “The Banks We Like”
For each area we study, we identify a set of players who we think demonstrate or approximate best practice either in their home market, in the region or globally.
Example of “The Banks We Like” template
5. Levels of Enquiry
We process our analytics for each business line or process at three levels:
- Macro-level Fundamentals
- Market-level Fundamentals
- Street-level Fundamentals
i. Macro-level Fundamentals
Macro-Level Fundamentals include our assessment of the universal themes for the area under study. We use Scenario Planning tools (see next section, under “Tools We Use”) to map the macro environment, including determining what are our own:
- Fundamental Beliefs – characteristics that we believe are fundamental to this business.
- Industry drivers – the drivers that would go into any process map of this area under study and defines it.
- Sign Posts and Red Flags that we need to be aware of as factors that can either affect this area positively or adversely in the near future, notwithstanding our base line assumptions.
ii. Market-level Fundamentals
Market Level fundamentals refer to factors that are specific to the markets in which the players operate and are not necessarily universal.
We use Strategic, Process or Performance Benchmarking tools (see next section, under “Tools We Use”) to map out hw the industry is playing out in the marketplace in which the institution or process being studied operates.
We also draw up a generic Business architecture templates for this business or process that typifies the players in this business or process.
iii. Street-Level Fundamentals
We use The Balanced Scorecard (see next section, under “Tools We Use”) to drill down to an acute understanding of how specific players operate in this area under study.
Other terminology we use
We also use terminology that is specific to the tool sets we use, such as Strategic Planning, the Balanced Scorecard and Six SIGMA, as explained in the next section.