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Opinion for March 6, 2000: What is Performance Management
 | Believe it of not, it is simply good, hard nosed management, and it has been around
since the first time human beings started to work in organizations. What is
happening now is that governmental reform has been taken up again. This (GPRA,
budget cuts, waste mongering, and reinvention) is another in a
long series of governmental management reform movements. Let's explore what this
means for managers and analysts. |
| The core of performance management as currently defined is the measurement of what is to
be done - the maxim "what is measured will be done" is the
epitome of current governmental management thought. There is much to support this
emphasis. It helps to focus on what is important, and allows managers to marshal
resources around clearly defined objectives. And if what is being measured is the
"right thing," then making progress towards these measures can be the basis for
explaining and defending programs against the politically fashionable attack of the
moment. |
| Much has been written about performance management. There is an extensive
literature and guidance available on the Internet, from governmental and private sources.
Much effort has been put into making guidance available. Many of these are
available through the links page for performance management.
But none of this is new. [You can readily trace the current focus to
the Planning, Programming, and Budgeting System, or PPBS, of the 1960's (and still
continued in the military establishment) and the Management by Objectives, or MBO, of the
Nixon Administration. I will not trace further at this time.] |
| Performance management boils down to focus. It is
institutionalized focus rather than the personalized focus that a leader or manager can
bring to the task. This is the reason for defining measures - what is measured will
get done because everybody involved has to focus on what it takes to achieve what is
measured, or to show a desired change in what is measured.
 | A corollary, of course, is that what is not measured is not worth
doing, and should get no management focus. Which leads to the next problem: If
what you are doing is valuable, you have to have it measured by your superiors.
(It is not sufficient to measure it yourself for yourself.) |
| But this runs into the natural tendency to consider everything important and therefore
worthy of measurement, which in turn runs into the problem of how to efficiently focus and
communicate. After all, who can focus on a large number of measures or things to do?
No one. Measures must be few in number if they are to be the focus of
managerial attention. This is where hard-nosed management has to come into play -
by making choices based on rational systems. |
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| The characteristics of good performance measures (among others, outcome-focused, few in
number, measurable, and sensitive to change over time) are derived from the need to
communicate and manage in human institutions - there is limited capacity to comprehend and
to pay attention. Communication must be efficient and precise. (Click to read more about communication and the budget process.) |
| In large and complicated programs (such as the Federal government's) there are many
things being done to achieve objectives. Some of these things are directly related
to achieving objectives, others are indirectly related, and yet others are probably
irrelevant. In many cases, these things are done by organizations that are very
large by themselves. The complications and complexities, however, must be reduced to
a relatively small number of measurable objectives, which may require contributions from
more than one of these large organizations. Developing appropriate measures and
integrating organizational activities is a difficult management challenge. GAO's
work on "best practices" related to performance management is aimed at
addressing this problem (click for a summary of GAO's
recommendations). Many of these recommendations can only be implemented
"top down," by an agency leadership that can, and wants to, do
the organizational and managerial heavy lifting involved in integrating programs. |
| If you happen to be at the lower hierarchical levels when this "heavy lifting"
is being engaged in, you obviously run the risk of being smothered and forgotten.
This is not good for you, nor is it good for the agency leadership engaged in
changing things - you may in fact be a key element in a key product. The solution is
to have a system that methodically examines, analyzes, and aggregates smaller elements of
work to form larger entities which in turn are the measurable performance indicators.
The key in such a system is careful identification of what is to be aggregated, and
a system of management that recognizes the need to have measurable performance at
different levels of the organization, with a clear methodology to aggregate
the various units of work to the whole that is displayed to the external world.
(The agencies that receive high scores in the various rankings of strategic and
performance plans have these systems in place, and manage them well. Those
which do not get poor ratings.) Having such rational
systems in place is the responsibility of the managers
responsible for integrating agency activities - this is how they are expected to
earn their keep. |
| I am sure that by now many of you are wondering if I come from some land of budgeting
and planning fantasy. For most places, it does not work this way, you say. I
agree. So what does this mean for most program and budget analysts, who have no
control over what a "top down" system delivers to their desks? What do you
do when the "top" is delivering a system that does not meet these criteria?
This will be a topic for another day - it is related to self-defense. |
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