Organizational Culture: Its Importance in Performance Measurement
Grifel, Stuart S., Public Management
Local governments define the success of their performance measurement systems in different ways. For some local governments, success means developing a few measures and reporting them annually within the budget. For other local governments, success means that performance measurement is an integral part of the organization's management and budgetary decision-making systems.
Uses of the Data
There are three levels of uses for performance measurement data. The first level, accountability reporting by the local government to the public that it serves, is an important use of such data. Recent literature, however, recognizes the fact that merely collecting and reporting data is not enough, and that a system's value over time will be defined in terms of management and improvement of operations, the second level.
A performance measurement system can generate a great deal of information, but to justify its cost, the information must be used. Collecting and reporting alone become a meaningless exercise over time, with the result that the measurement system eventually falls into disuse and fades away. The difficulty that many local governments face is not in developing appropriate and reliable program performance measures but in integrating them into the management and operational decision-making systems of the organization.
Level three, using measurement data for budgetary decision making and allocation of resources, is especially difficult Few jurisdictions have been able to make this linkage successfully. Often, they have used performance measurement data to manage resources at the program level and for financial reporting, but not to exert a substantial influence on the allocation of resources. It is not easy to design systems that appropriately link the measurable goals and objectives of programs with their results and then link the results to budgeting and financial reporting.
Performance measurement should be used as a management tool before the attempt is made to use it as a budgeting or evaluation tool. Management should be comfortable with using performance measurement to augment the normal decision-making process before using it for other purposes.
Implementing a performance measurement system means change for an organization. The change can be as limited as merely presenting data annually in the budget document or as pervasive as affecting every aspect of an organization's management, budget, and reward system.
Moving beyond a system that reports measurement data only for accountability purposes calls for an organizational environment that accepts change. For change to occur in an organization, managers must create or seek favorable conditions for it. Creating this climate will require that the organization first build an awareness that change is needed and then gain the support of the people who must implement and cooperate with the change.
A System to Fit the Local Government Situation
Government managers need to assess all aspects of their local situation that may affect the success of a performance measurement system. Performance measurement and other improvement approaches develop differently in different communities, depending on the conditions and problems in the community, the level of interest of its elected officials and managers, the abilities of the staff, and the resources available for improvements (Epstein 1984).
What works, for example, in Sunnyvale, California, with a history steeped in information technology, may not work in your organization's environment. Managers will need to assess their own local situations and tailor systems that will allow them some level of success. If you take the time to assess your local circumstances, you can develop strategies to minimize organizational weaknesses and maximize organizational strengths.
Building a successful system is an incremental and long-term process. …