Performance Measurement and Managerial Thinking Concept Map


Question Description

Please prepare a one-page concept map to illustrate relationships between essential concepts or ideas of the attached readings (5 articles attached about performance management) using PowerPoint, Word, Visio, or any other software. It can take any forms of charts, graphic organizers, flowcharts, or diagrams. I will attach some examples of the concept map later. I don't need just titles or chapter names, I need you to mention the key points and/or concepts of each articles and their relation with other articles.

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Performance-Based Management: Responding to the Challenges Author(s): Joseph S. Wholey Source: Public Productivity & Management Review, Vol. 22, No. 3 (Mar., 1999), pp. 288-307 Published by: Taylor & Francis, Ltd. Stable URL: Accessed: 10-01-2019 05:51 UTC JSTOR is a not-for-profit service that helps scholars, researchers, and students discover, use, and build upon a wide range of content in a trusted digital archive. We use information technology and tools to increase productivity and facilitate new forms of scholarship. For more information about JSTOR, please contact Your use of the JSTOR archive indicates your acceptance of the Terms & Conditions of Use, available at Taylor & Francis, Ltd. is collaborating with JSTOR to digitize, preserve and extend access to Public Productivity & Management Review This content downloaded from on Thu, 10 Jan 2019 05:51:04 UTC All use subject to PERFORMANCE-BASED MANAGEMENT Responding to the Challenges JOSEPH S. WHOLEY University of Southern California and U.S. General Accounting Office T hroughout the world, both in government and in the not-for-profit sector, leade and managers are grappling with closely related problems that include tight restric tions on resources, increasing demand for effective services, low levels of public tru and increasing demand for accountability (Organization for Economic Cooperation and Development, 1996; U.S. Congress, 1993). One solution that has been offered is performance-based management or managing for results, that is, the purposeful use of resources and information to achieve and demonstrate measurable progress toward agency and program goals. But what exactly is performance-based management? Is performance-based management useful enough to justify its cost? The theory is that managers will be able to develop a reasonable level of agreement on agency and program goals and strategies for achieving the goals and that managers will be able to develop performance measurement systems of sufficient quality to document performance and support decision making. Managers will then use performance information in systems for managing their agencies and programs, in accountability to key stakeholders and the public, to demonstrate effective or improved performance and to support resource allocation and other policy decision making. Although the theory underlying performance-based management may be fine, we have seen many fine theories over the years. The planning-programming-budgeting system, management by objectives, zero-base budgeting, and total quality management all had-and still have-their virtues. This article grapples with major challenges in performance-based management: * How can managers develop a reasonable level of agreement on goals and strategies for achieving the goals? * How can managers develop performance measurement systems of sufficient quality to document performance and support decision making? Author's Note: The views and opinions expressed by the author are his own and should not be construed to be the policy or position of the General Accounting Office. Public Productivity & Management Review, Vol. 22 No. 3, March 1999 288-307 C 1999 Sage Publications, Inc. 288 This content downloaded from on Thu, 10 Jan 2019 05:51:04 UTC All use subject to Wholey / PERFORMANCE-BASED MANAGEMENT 289 * How can managers use performance information in systems for managing agenc programs? In providing accountability to key stakeholders and the public? * How can managers use performance information to demonstrate effective or imp performance? To support resource allocation and other policy decision making? * What specific types of training do managers need? * What research should be done on performance-based management? Responding to excellent questions posed by Archibugi (1997), this article explo the specific content of performance-based management and suggests how manag can effectively implement performance-based management. Finally, the article out- lines required training and suggests research that should be done on performancebased management. What Is the Specific Content of Performance-Based Management? The key steps in performance-based management are (a) developing a reasonable level of agreement on missions, goals, and strategies for achieving the goals; (b) imple- menting performance measurement systems of sufficient quality to document performance and support decision making; and (c) using performance information as a basis for decision making at various organizational levels (U.S. General Accounting Office [GAO], 1996a, p. 8). DEFINING PERFORMANCE: MISSION, GOALS, AND STRATEGIES Performance is a term that may have many meanings. Radin (1997) questions th assumption that performance information is objective and suggests that concepts equity and equality may be submerged in performance-based management systems. Stoiber (1997) states that there are few value-neutral performance measures that will demonstrate unequivocally whether a program is a success or a failure. To implement effective performance-based management systems, managers first must achieve a reasonable level of agreement with senior officials and other key stakeholders on agency or program goals and on the resources, activities, and processes required to meet the goals. Public and not-for-profit agencies often can achieve such agreement through planning processes that include broad consultation with managers and staff, those who influence the allocation of needed resources, those who make other policy decisions affecting the agency or program, and other key stakeholders affected by or interested in agency or program activities. Sicotte and his colleagues (1998) offer a helpful framework for sorting through the various dimensions that may constitute performance. Sicotte et al. note that at one time or another, performance may focus not only on goal attainment but also on three other subsystems-production, culture and values maintenance, and environmental adaptation-as well as on relationships among the four subsystems. Performance may focus on inputs (e.g., dollars, staff, incoming workload, legal authority, political/bureaucratic support). It may focus on activities or processes that convert inputs to outputs and then to outcomes (e.g., the extent to which agency or pro- gram activities comply with applicable laws, regulations, guidelines, or process This content downloaded from on Thu, 10 Jan 2019 05:51:04 UTC All use subject to 290 PPMR / March 1999 standards). Performance may focus on the quantity of agency or program outputs, th is, products or services delivered to partners, clients, or the public. It may focus on e ciency or productivity, which relate output to input. In current performance-based management initiatives, performance often focuses on service quality and outcome that is, results achieved in individuals, organizations, or populations outside the agency or program (United Way of America, 1996; U.S. Congress, 1993; U.S. GAO, 1996a). Performance often will focus on intermediate outcomes such as client satisfaction or short-term changes in the behavior of individuals or organizations. It may focus on end outcomes such as environmental quality or health status. To meet concerns raised by Radin (1997) and others, the notion of agency or program performance may be extended to include important unintended outcomes of agency or program activities (e.g., corruption, "creaming," other failures to provide fair treatment, costs incurred by individuals or organizations as they respond to agency or program activities). Agencies can bring such unintended outcomes into a goal attainment framework by getting a reasonable level of agreement on goals that relate to minimizing" or "controlling" those unintended outcomes. Performance may focus on net impact, that is, what difference a program has made. Net impact can be "measured" through program evaluation studies that compare program outcomes to estimates of the outcomes that would have occurred in the absence of the program. Agencies should define performance broadly enough to cover the key performance dimensions-the inputs, activities, outputs, intermediate outcomes, and end outcomes-that are important to the primary intended users of performance information. Typically, managers and staff will tend to focus on inputs and outputs, over which they have more control, whereas many at policy levels will be interested in the relationship between inputs and outcomes. Advocacy groups may focus on unintended outcomes. Managers and staff can use logic models to help ensure that they have identified relevant elements of the program design, that is, key program inputs, activities, outputs, intermediate outcomes, end outcomes, assumed causal linkages, and key external fac- tors that could significantly affect performance (Wholey, 1994). IMPLEMENTING PERFORMANCE MEASUREMENT SYSTEMS OF SUFFICIENT QUALITY Once there is a reasonable level of agreement on the meaning of performance, m agers can obtain information on key aspects of agency or program performanc through performance measurement, that is, the periodic measurement of specific gram inputs, activities, outputs, intermediate outcomes, or end outcomes. Perf mance measurement includes both the collection and analysis of numerical data less formal assessment of agency or program performance such as narrative as ment of the extent of progress toward agency or program goals. Performance may be measured annually to improve accountability and support p icy decision making, or it may be measured more frequently to improve managem service delivery, and program effectiveness. Performance may be measured throu variety of means including use of agency and program records, use of the record other agencies, interviews, focus groups, surveys, and assessments by experts or This content downloaded from on Thu, 10 Jan 2019 05:51:04 UTC All use subject to Wholey / PERFORMANCE-BASED MANAGEMENT 291 trained observers. In difficult-to-measure programs or when net impact inform required, performance may be measured through more costly and less frequent pro- gram evaluation, which assesses how and to what extent programs achieve goals. Program evaluation can provide a more complete picture of program performance than the rough sketch that is obtainable through quarterly or annual performance measurement, or it can be used to identify and document more effective program approaches. Performance measurement systems should meet reasonable tests of validity, reliability, and timeliness (Hatry, 1997b; Hatry & Kopczynski, 1998, pp. 67, 85). As Lipsey (1993, 1998) notes, agencies should use performance measures that are sensi- tive to the changes that a program is designed to produce. After studying leading public sector organizations that were working to become more results oriented, the GAO identified characteristics common to successful hier- archies of performance indicators, noting that agencies "must balance their ideal performance measurement systems against real-world considerations such as the cost and effort involved in gathering and analyzing data" (U.S. GAO, 1996a, p. 24). Performance measures at each organizational level should demonstrate results, telling each organizational level how it is achieving its goals; be limited to the vital few perfor- mance indicators per goal; respond to multiple priorities; and link to offices that have the responsibility for making programs work. As agencies implement performance measurement systems, they should balance the costs of data collection against the need to ensure that the data are sufficiently complete, consistent, and accurate to document performance and support decision making at various organizational levels, in particular, that the data are sufficiently free of bias and other significant errors that would affect conclusions about the extent to which program goals have been achieved (U.S. GAO, 1996a, pp. 24-28). Performance measurement systems should not be too costly in terms of the management and staff time required to collect, analyze, and use performance information; the costs of any contracts for data collection and analysis; the burden imposed on reporting entities; political and bureaucratic costs; and other important negative conse- quences of performance measurement. Managers might be able to use existing records or sampling to limit the costs of performance measurement. Whether performance measurement is based on existing records or on new data collection, quality issues can arise in performance measurement systems. Samples may be unrepresentative or too small to yield reliable data, for example, and so performance data may present a biased or an unreliable picture of agency or program performance. United Way of America (1996) identifies such performance measurement issues, suggesting that attention should be given to response rates, planned observations that could not be completed, the possibility of errors in recording and transferring data, and the possibility that data analyses are done incorrectly (pp. 110, 114, 127; see also U.S. GAO, 1998c, p.41; H. P. Hatry, personal communication, February 1998). Although managers typically have more contextual information, both managers and policymakers need the assurance that agencies and programs have in place reason- able quality control processes that periodically review data collection procedures and test the validity and reliability of at least a sample of the data (Hatry, 1997b). Perfor- mance measurement systems should, therefore, be reviewed and updated periodically This content downloaded from on Thu, 10 Jan 2019 05:51:04 UTC All use subject to 292 PPMR / March 1999 (Auditor General of Canada, 1997, pp. 11-12; United Way of America, 1996, pp. 127-128; U.S. GAO, 1998c, pp. 40-42). The U.S. Department of Education has developed a broad strategy and specific approaches for strengthening the quality of performance data. The department's plan includes developing department-wide standards for performance measurement, train- ing employees in the application of the standards, standardizing definitions of key variables, coordinating data collection across different information systems, having managers attest to the reliability and validity of performance data or submit plans for data improvement, and using audits and evaluation studies to strengthen the quality of performance data (U.S. Department of Education, 1998, pp. 87-90). USING PERFORMANCE INFORMATION Performance information is intended to be useful to managers, policymakers other key stakeholders affected by or interested in the program. The primary performance information should be in systems for managing agencies and prog achieve effective performance in terms of "agreed-on" goals. Performance-b management practices include delegating authority and flexibility in return for accountability for results, creating incentives for improved program performance, redesigning central management systems to focus on performance, reallocating resources or redirecting program activities to improve performance, and developing partnerships designed to improve performance (see Table 1). MANAGING FOR RESULTS: CRITERIA CHARACTERIZING PERFORMANCE-BASED MANAGEMENT In summary, the prerequisites for performance-based management or manag results are agreed-on goals and strategies and performance measurement sys sufficient quality. Thus, performance-based management includes developin sonable level of agreement on goals and strategies for achieving goals and deve performance measurement systems that provide data that are sufficiently com accurate, and consistent to document performance and support decision makin agers may then use performance information in management systems direct achieving effective performance in terms of agency or program goals. Manage may use performance information in providing accountability to key stakehol the public, to demonstrate effective or improved performance, or to support allocation or other policy decision making (see Table 2). John Mayne and his colleagues in the Office of the Auditor General of Cana developed a related framework for assessing agency and program management used that framework in assessing the extent to which agencies and programs ar ing toward managing for results. This framework focuses on organizational cli and the extent to which there is agreement on expected results, measurement of r use of performance information to improve program performance, and effective reporting on performance (Auditor General of Canada, 1997, pp. 11-7 to 11-12). This content downloaded from on Thu, 10 Jan 2019 05:51:04 UTC All use subject to Wholey / PERFORMANCE-BASED MANAGEMENT 293 Table 1. Some Performance-Based Management Practices 1. Delegate greaterauthority andflexibility in returnforaccountabilityfor results (e.g., by simplifying the rules for budgeting, human resource management, or financial management). 2. Create intangible incentives for improved agency or program performance (e.g., performance agreements setting challenging but realistic performance goals for agencies or programs, quarterly or more frequent performance measurement and reporting, meetings focused on performance is- sues, publicity about relative performance levels or changes in performance, delegating greater authority and flexibility in human resources management or financial management to higher performing organizations). 3. Create financial incentives for improved agency or program performance (e.g., introducing competition among service providers, reallocating resources to higher performing or mostimproved service providers, linking employees' performance appraisal and pay with organizational performance). 4. Provide training and technical assistance to build expertise in strategic planning, performance measurement, and management use of performance information. 5. Redesign central management systems (e.g., budgeting, human resource management, information management, procurement, financial management) to focus on performance. 6. Incorporate goals, performance measures, and per,formance incentives into contracts and grant programs. 7. Reallocate resources to improve agency or program performance. 8. Redirect program activities to improve performance. 9. Develop partnerships designed to improve performance (e.g., partnerships among public agencies, partnerships among not-for-profit organizations, partnerships between public sector agencies and not-for-profit organizations or private firms). Source. Adapted from U.S. General Accounting Office (1996a, pp. 18-20, 38-46, 51). Implementing Performance-Based Management at the Federal Level The Government Performance and Results Act of 1993 (GPRA) is central to current performance-based management efforts at the federal level in the United States. In this statute, inspired by the growing use of performance measurement at the state and local levels and throughout the world, Congress prescribed consultation and planning to identify agency and program goals and annual reporting on performance. Contrary to efforts 30 years earlier under the planning-programming-budgeting system, current performance-based management efforts are grounded in statute and are focused on agencies and programs that are the responsibility of senior managers and specific con- gressional committees. The required planning and performance measurement, and th ...
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Concept Map
Why is it necessary to
measure performance?
➢ It helps in attaining

➢ Determining how an

What is performance-based management?
➢ Also known as managing for results
➢ Resources are used with the
express intention of achieving and
demonstrating progress towards
the goals of the agency in a
measurable way (Wholey, 2019)

Steps to implementing performance-based
➢ Agreeing on the goals missions and
the strategies to be employed
➢ Having a measurement system for
performance to aid in decision
➢ Performance information serving as
the basis for decision making
(Wholey, 2019)

What are these goals?
➢ Motivation
➢ Promotion
➢ Celebrating
➢ Learning
➢ Improving
➢ Evaluation
➢ Controlling
➢ Budgeting

Reasons for performance measurement in the public
➢ To show accountability to citizens
➢ Performance monitoring
➢ Improve civil liability (Ammons, 2002)
➢ Recognize exceptional areas and work on
weak areas (Behn, 2003)

What are the metrics that should be used?
➢ Performance cannot be measured
using a single metric
➢ There should be metrics for each of
the managerial goals (Behn, 2003)

How has the government measured

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Carnegie Mellon University

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