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Return on Disability™
Measurable Results Means Accountable Leadership
In its challenge to manage the risk of its trading book, JP Morgan needed a simple, robust way to assess the potential to make(or lose) money. It boiled down billions of dollars in a diversified investment portfolio to one number, called Value At Risk. It gave managers a relative tool to assess business decisions.
Disability, especially in a business context, does not have robust relative measures for managers to benchmark progress against targets. Traditional measures like Return on Investment are fantastic for established businesses, but measure the past and assume full/healthy budgets. Innovation requires a different yard stick, based on Economic Value principles, that measure potential and opportunity cost. The yard stick must also be flexible, such that once the opportunity is accepted and budgets are allocated, it can revert to a more traditional regime that would make any accountant beam.
Integrated Process Solutions LLC(IPS) recognized that in order for profit seeking organizations to deploy capital in the business/disability space, progress from a low level must be measured through to the realization of long term objectives. Simply put, that’s how business works.
IPS has developed a proprietary measurement system that measures relative progress based on seven separate interfaces, in two stages, that benchmark to one number. The seven interfaces allow for the granularity required to identify strength, weakness, opportunity and threat. In plain English, breaking the mass into seven chunks makes it easier to assign projects/tasks to maintain accountability. It also makes progress assessment more manageable.
The two stages are consistent with the IPS belief that quick, easy wins are critical to long term success. During the initial period of learning and process development, the Innovation Stage, potential and perception is measured through Innovation Return on Disability™(IROD). By making assessment on progress to a firm specific goal, IROD signifies the point where a firm is ready to allocate capital to the business/disability space in a profitable manner.
Once capital is allocated, shifting to a measure of return on said capital is critical. Allocated Return on Disability™(AROD) follows a more traditional measurement path by heavily weighting the quantitative returns, while maintaining elements of the seven interfaces to keep to the path of innovation.
At the bottom of the page, an organization knows where it stands in the business/disability space with Return on Disability™(ROD). No more guessing from managers who think they know an opportunity and their firm’s position relative to that opportunity.
Do you know where you stand?