Financial leadership has increasingly become a central success factor of companies. Increasing volatility, uncertainty and complexity in the environment however demand a new leadership paradigm as well as contemporary financial management and control systems. Most management systems were developed during the industrial age, and are based on traditional leadership paradigms. The “command & control” principle, with its strong focus on pure financial control parameters, characterizes this approach. This principle, however, requires a stable environment. Since the industrial age, the business environment, organizations, and the society in general have changed drastically. Currently, we live in a VUCA world (volatility, uncertainty, complexity, ambiguity), which demands high agility and flexibility from the company and its employees. The advancing digitalization in practically all sectors and value creation processes is accelerating this trend further. Traditional financial management systems (EVA®, mid term planning, budgeting, incentive systems, etc.) in general foster bureaucracy and rigidity and do not consider behavioral aspects Increasingly they are seen as a barrier towards more agility.


With the SPMM – St. Gallen Performance Management Model we have developed a holistic model to align financial management with current leadership challenges, in order to support managers with the transformation of their financial leadership systems. This is the result of long-standing research and extensive practical experience, which converged at the chair of Controlling/Performance Management at the University of St. Gallen and the Hilti Lab for Integrated Performance Management under leadership of Prof. Dr. Klaus Möller and Franz Wirnsperger, former chief financial officer at Hilti, together with various practice partners. The model profited substantially from the experience of the successful management system transformation at Hilti, a global market leader in fastening technology with more than 23,000 employees.


In the meantime, we tested and further optimized the model in the context of various cycles of an innovation-action research at companies of different sizes and sectors. In addition, we surveyed management practices at more than 200 companies in Germany, Austria, and Switzerland. This allowed us to ascertain that companies which apply the SPMM practices are significantly more successful, not only financially, but also when applying a holistic performance assessment (i.e. if customer and employee evaluations are taken into consideration).


With the information on this page, we would like to make our experience available to interested parties and to encourage them to specifically develop their management system further. We welcome feedback and suggestions!