Measuring Business Excellence

Performance-driven behavior as the key to improved organizational performance : Table of Contents

André A. de Waal — Mon Mar 15 02:05:42 GMT 2010

Abstract:
Purpose – Recent research states that both the instrumental and the behavioral dimensions of performance management have equal influence on the performance of an organization. To test this statement, these dimensions have been operationalized in an analysis tool called the performance management analysis (PMA). This paper aims to discuss the results of research into the relation between the instrumental and the behavioral dimensions and organizational performance, using the PMA. Design/methodology/approach – The PMA questionnaire was developed to test the instrumental and behavioral dimensions of performance management. With the PMA an organization can score itself on both dimensions, to evaluate the degree of its result-orientation. The more attention an organization pays to elements belonging to a certain dimension, the higher it will score on that dimension. In addition the relative competitive performance of the organization is identified. This is done by asking the respondents to compare their organization's performance to that of its competitors or organizations with similar services. During the period January 2002-March 2006 data were obtained by distributing PMA questionnaires to work-experienced students of MBA courses taught by the author, participants of seminars conducted by the author, and workshops held by the author and colleagues at companies. In total 577 questionnaires of organizations in The Netherlands and the UK from a broad range of industries (both profit and non-profit), were collected. Findings – The research results show that paying equal attention to the instrumental and behavioral dimensions of performance management systems indeed results in higher competitive performance. Therefore, the research results provide a first indication of the importance of combining instrumental and behavioral dimensions to create a successful performance-driven organization that achieves sustained better results. Research limitations/implications – The respondents of the questionnaire may have scored their own company more favorably than an objective outsider would have done. It is also possible that there are other aspects of importance to performance-driven behavior, which have not been included in the research. Practical implications – This study identifies which instrumental and behavioral dimensions an organization has to focus on, and the extent of this focus, in order to achieve sustainable performance. Originality/value – An increasing number of profit and non-profit organizations are implementing new and alternative performance management systems in order to obtain better organizational results. Despite the increase in experience gained with this approach, there is still a lot to be learned about the factors that influence the everyday use of these systems and of the factors that influence performance-driven behavior. The research described in this paper provides evidence that paying equal attention to both instrumental and behavioral dimensions is paramount in order to create a successful performance-driven organization that achieves sustained better results. As these dimensions have until now not been identified as an integral set, this identification is the contribution to the literature.

Managing for performance in New Zealand's public service – a loosely coupled framework? : Table of Contents

Rodney Dormer, Derek Gill — Mon Mar 15 02:05:42 GMT 2010

Abstract:
Purpose – The purpose of this paper is to examine the institutional factors that impact on the integration of the formal model of performance management in New Zealand's public service and the model, or models, in use within different agencies and at different levels within those agencies. Design/methodology/approach – The research involved semi-structured interviews with managers within three agencies of New Zealand's central government as well as a review of their external accountability documents and internal management reports. These data were then interpreted in the context of new institutional sociology. In particular, the institutional carriers identified by Scott (2001) Scott were used to map the characteristics within each agency that support more or less integration, and common use, of performance measures. Findings – It is concluded that an integrated framework of performance objectives, that drops down from the Government's priorities, to Ministers' purchase of goods and services, to managers' objectives at each layer of the agency, does not always exist. Institutional arrangements that emphasise regulative controls are more likely to result in the decoupling of nationally defined frameworks from those used locally by operational managers. Conversely, institutional arrangements that emphasise culturally and cognitively based controls are more likely to support tight coupling of performance management frameworks and practices. Originality/value – While much has been written about public sector management and what has been referred to as “the New Zealand model”, this has largely been concerned with the management of the public sector as a whole. This research provides an empirical insight on management practices within individual public sector agencies.

Synthesizing management control frameworks : Table of Contents

Winnie O'Grady, Paul Rouse, Cathy Gunn — Mon Mar 15 02:05:42 GMT 2010

Abstract:
Purpose – The purpose of this paper is to investigate the holistic nature of control systems to understand how they operate across organizational levels and manage change. Design/methodology/approach – This paper takes an analytical approach using the viable system model (VSM) to assess the two main frameworks of control reported in the accounting literature. Findings – The VSM provides an elegant framework for management control systems with explicit consideration of: multiple levels of control, communication channels, interactions with the environment, and the mechanisms for attaining balance between stability and change. Practical implications – The evaluation of current management control systems produces specific suggestions for improving the levers of control framework Originality/value – The VSM has not previously been aligned with management control frameworks.

Managing without measuring: a study of an electricity distribution company : Table of Contents

M. Sobótka, K.W. Platts — Mon Mar 15 02:05:42 GMT 2010

Abstract:
Purpose – The purpose of this paper is to present an exception to the common belief “If you can't measure it, you can't manage it”. It aims to show how in certain situations particular practices, attitudes and cultures can remove the need for individual performance measurement. Design/methodology/approach – First, the paper identifies the usual roles of performance measurement in managing individual employees as described by control and motivation theorists. Second, it identifies a market-leading organisation where managers deliberately refuse to use their top-level performance measurement system to manage the performance of individual employees. A case study is carried out to test what non-measurement mechanisms fulfil the roles of individual performance measurement in this organisation. Findings – Building on situations observed at this company, a set of possible characteristics of companies that do not require formalised individual performance measurement systems in order to achieve high performance standards is put forward. Practical implications – Managers should not always assume that individual performance measurement is the only way to achieve excellent performance. This study shows that, by granting responsibilities and providing appropriate support, managers can channel workers' enhanced motivation towards meeting wider organisational goals. Originality/value – This work broadens the understanding of how excellent performance can be achieved. It shows that excellence can be achieved through practices based on shared values linked to motivation, trust, and a common sense of mission, without the need to install individual performance measurement systems based on cybernetic principles.

An engagement framework for managing the Crown's ownership interests in the New Zealand tertiary education sector : Table of Contents

Doug Galwey, Barry Ogilvie — Mon Mar 15 02:05:42 GMT 2010

Abstract:
Purpose – The purpose of this paper is to present the theoretical foundations and lessons learned in the development and implementation of an institutional engagement framework for monitoring and managing the Crown's ownership interests in the New Zealand tertiary education sector. Design/methodology/approach – The core analytics and tasks comprise financial stress testing, the Baldrige assessment approach and capability benchmarking, integrated into an overall risk management system using many of the elements of Robert Simons' “Levers of Control”. Findings – The approach has been useful in identifying institutions most at risk and requiring higher levels of direct engagement, including statutory management intervention by the Crown. Practical implications – It is considered there are ample performance measurement tools available and that ultimately success is through system design and management of the performance management process itself, with the capability of those undertaking the activity being as equally important as those whose capability is being assessed. Originality/value – This paper shares insights on framework design and deployment with fellow practitioners.

Internal performance management with UK higher education: an amorphous system? : Table of Contents

Martin Broad, Andrew Goddard — Mon Mar 15 02:05:42 GMT 2010

Abstract:
Purpose – The purpose of this paper is to provide insights into the internal performance management of UK universities. Design/methodology/approach – Semi-structured interviews were undertaken with numerous staff within each university, attendance at key meetings and reviews of documentation. Grounded Theory was adopted to analyse the information obtained to understand how the strategy and accounting interacted with performance systems in the universities studied. Findings – An amorphous, decoupled system was identified with poor feedback loops resulting in a lack of accountability and ownership of the system. Research limitations/implications – The research reported on the experiences of two universities through case study analysis. Further research is required to understand the extent to which the issues reported here are more widespread and the implications of such. Practical implications – The paper suggests that the challenge for policy makers/university management is to facilitate a change in the managerial weltanshauung to one where the environment is more conducive to performance management in a constructive manner Originality/value – The notion of managerial weltanshauung in universities is developed and discussed in relation to nurturing performance management. The paper will be of interest to university managers and policy makers.

Performance measurement and management: a literature review and a research agenda : Table of Contents

Paolo Taticchi, Flavio Tonelli, Luca Cagnazzo — Mon Mar 15 02:05:42 GMT 2010

Abstract:
Purpose – The purpose of this paper is to review the literature in the field of performance measurement and management (PMM) for small and medium enterprises (SMEs) and large companies and propose a research agenda for the future. Design/methodology/approach – This paper provides an update of Neely's work “The evolution of performance measurement research” The literature review has been carried out by using two different methodologies. Citation/co-citation analysis has been used to explore “performance measurement” (PM) literature, while a chronological review of main frameworks/models developed both for large and small companies is presented in order to highlight “PMM” literature. Findings – The paper analyzes the literature on the field and carries out the most cited works and the common characteristics of them based on the key words used. The results of the literature review reveal a certain maturity of the literature related to large companies and a significant lack of PMM literature for SMEs. Finally the paper argues the development and evolution of the research field that is now entering a phase of new directions. These new directions can be conceptualized in three ways – by context, by theme and by challenge. Research limitations/implications – The research presented in the paper is limited to work that is referred directly with performance measurement and management. Related research – such as literature on management control and accounting – has not been considered, even if future researches could include it. Originality/value – The paper extends Neely's work under two dimensions: the research field evolution from 2005 to 2008 and the investigation of the “performance management” dimension. The paper will be valuable to scholars working in the field of business performance measurement and management, interested in the literature evolution and in identifying future areas of research.

Beyond words: testing alignment among inter-organizational performance measures : Table of Contents

Maria Rey-Marston, Andy Neely — Mon Mar 15 02:05:42 GMT 2010

Abstract:
Purpose – This paper seeks to measure in a quantitative way the degree of alignment among a set of performance measures between two organizations. Design/methodology/approach – This paper extends Venkatraman's test of coalignment to assess the alignment of a set of performance measures governing a contractual inter-organizational relationship. The authors applied the test and present coefficients of misalignment across three sets of measures: those used by a service provider involved in the research, those used by customers contracting the services, and those documented in 11 contracts studied. Findings – Results confirmed a high degree of alignment between target and actual operational performance in the contracts. The alignment of customers' financial objectives and contracts' operational metrics was low. Calculations show poor alignment between the objectives of the provider and the contribution received from the contracts. Research limitations/implications – Some limitations of the conclusions include the small sample of contracts used in the calculations. Further research should include not only actual contracts, but also failed ones. Practical implications – It is possible that misaligned goals, represented in misaligned performance measures, lead to tensions in intra-firm relationships. If these tensions are not addressed properly the relationship could be unstable or terminated prematurely. This method of measuring alignment could detect early potential dangers in intra-firm relationships. Originality/value – This paper extends Venkatraman's test of coalignment to assess the alignment of a set of performance measures governing a contractual inter-organizational relationship. Management researchers and business professionals may use this methodology when exploring degrees of alignment of performance measures in intra-functional and inter-firm relationships.

Rediscovering performance management: systems, learning and integration : Table of Contents

Aurel Brudan — Mon Mar 15 02:05:42 GMT 2010

Abstract:
Purpose – This paper sets out to explore performance management as a discipline and propose an integrated performance management model. Design/methodology/approach – This conceptual paper aims to clarify what performance management is and how it emerged as a discipline by tracking its evolution at strategic, operational and individual levels. Structured as a review, it enables the rediscovery of performance management and the identification of several key dichotomies, brought together under an integrated performance management model. Findings – Three emerging approaches to performance management are presented as potential catalysts to accelerate the evolution of this discipline: systems thinking, learning and integration. An integrated performance management model is also proposed. Research limitations/implications – The paper draws on the consultancy and research experience of the author. The generated model is conceptual in essence and needs to be tested. Further research on the history of performance management as a discipline and the integration approach between organisational levels is needed. Practical implications – The paper makes suggestions for improving performance management governance – the introduction of the Performance Management Office. It also suggests a higher emphasis on learning and integration during the implementation and usage of performance management systems. Social implications – By outlining the importance of systems thinking in managing organisational performance, this paper highlights the need for encouraging its applicability and implementation through systemic thinking. A higher emphasis on including elements of systems thinking in educational curricula may be a possible step forward. Originality/value – The paper is relevant to both practitioners and academics, as it clarifies the existing body of knowledge and provides a platform for future research