Academic journal article Public Administration Quarterly

Performance Metrics: Avoiding the Pitfalls

Academic journal article Public Administration Quarterly

Performance Metrics: Avoiding the Pitfalls

Article excerpt

ABSTRACT

This article discusses the method often used to select a work group's goals and measures, including brainstorming, nominal group technique, and multivoting. It describes the pitfalls in selecting and ranking output measures and emphasizes the necessity for considering possible interactions when selecting multiple goals and measures. Although all measures usually are given identical weights, which in certain situations may be optimum, in most cases some measures should weigh more heavily than others.

INTRODUCTION

Economic analysis usually assumes the existence of a profit motive. The effect of this motive is cited in introductory economics courses as one of the key strengths of free markets in that the generation of normalize profits in a competitive environment usually produces the most efficient allocation of resources. This analysis is difficult to translate to a not-for-profit or governmental business situation, however where the power of profits is not applicable. This article explores using other measures in situations where profit measures are not applicable.

Within government, performance measurement has been a hot topic recently. Both Congress and the President have required managers to measure organizational efficiency and effectiveness as one way to improve program performance. Early attempts to measure performance were made as early as the 1930s and again in the 1970s under the Productivity Improvement Council and received renewed attention with the publication of Vice President Gore's Report of the National Performance Review, passage of the Government Performance and Results Act of 1993, and the office of Management and Budget's implementation of the Chief Financial Officer Act of 1990. Each of these initiatives stresses the need for improved performance measures. For example, Executive Order 12852, Setting Customer Service Standards, requires surveying customers to improve product or service quality. With all of this interest, the body of literature on performance measures is becoming quite large.

The American Society for Public Administration (1992) found that the "use of performance measurement is still the exception rather than the norm in American government organizations ... [T]here is great potential to improve performance, accountability, and reporting, and by integrating systemic performance measurement, monitoring, and reporting, and by integrating performance information into regular policy and management processes."

Nyhan and Marlowe (1995) trace the focus on measurement techniques to improve the production of workers to Taylor (1911) and others following his work. They also cite the pioneering work of the New York Bureau of Municipal Research early in this century and note that, with the general decline in productivity growth in the 1970s, performance measurement became of great concern in all levels of government.

The use of various types of measurement is an often-explored issue. These types are usually divided into five classes: inputs, process, outputs, outcomes, and impacts. Behn (1995:319) illustrates several of these, using the example of a public-health program designed to assist expectant mothers: o Input measures include the number of public-health clinics providing this service, the number of public-health nurses working in these clinics, and the dollars spent on the program.

o Output measures include the number of women who participated in the program, the number of visits these women made to the clinics, and the prenatal instructions that they followed.

o Outcome measures include the number of healthy (and unhealthy) babies born to women who participated in the program.

o Impact measures include the difference between the number of healthy babies born to women who participated in the program and the number of healthy babies who would have been born to these women had they not participated in the program. …

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