Performance Based Management Handbook

Noted performance measurement expert, Mark Graham Brown, points out that:

• Measurement reduces emotionalism and encourages constructive problem solving. Measurement provides concrete data on which to make sound business decisions, thus reducing the urge to manage by “gut feeling” or intuition.

• Measurement increases one’s influence. Measurement identifies areas needing attention and enables positive influence in that area. Also, employees “perform to the measurement,” an example of how measurement influences employee performance.

• Improvement is impossible without measurement. If you don’t know where you are, then you can’t know where you’re going and you certainly can’t get to where you want to be. It’s akin to traveling in unknown territory without a compass or a map. You’re totally lost. (Ref:  The Performance Based Management Handbook, Vol. 2, Establishing An Integrated Performance Measurement System, P. 5)

“Successful organizations require the active participation and support of five broad stakeholder groups to achieve their objectives. These stakeholder groups are:

1. Customers

2. Owners

3. Employees

4. Suppliers

5. The broader community.

A strategy has to be developed to systematically understand what these stakeholders want and expect.

Depending on the stakeholder, however, different techniques or tools are used. For customers, organizations often use surveys or customer focus groups. For employees, surveys, focus groups or discussions are excellent tools.

Developing performance measurement information from stakeholders serves two purposes:

1. It evaluates whether tactical plans, such as customer satisfaction and employee commitment, are being met.

2. It provides a means of testing the presumed cause and effect relationships between performance measures and strategies. For example, does higher quality result in increased sales? (The cause and effect relationships are discussed in more detail in the section entitled Reconciling Gaps In The Strategic Plan.)”   (Ref:  The Performance Based Management Handbook, Vol. 2, Establishing An Integrated Performance Measurement System, P. 14)

 

Sample Management Performance Measures
 
Performance Management Handbook, City of American Canyon