Evolution of performance management systems?

Hi David,

A useful article on this topic is: TOWARDS A DEFINITION OFA BUSINESS PERFORMANCE MEASUREMENT SYSTEM, published in the International Journal of Operations and Production Management, 2007, Vol.27(8), pp.784-801 by a collective of researchers: 
Franco-Santos, Monica, Kennerley, Mike, Micheli, Pietro, Martinez, Veronica, Mason, Steve, Marr, Bernard, Gray, Dina and Neely, Andy. The article contains about 17 definitions selected from academic literature published between 1990 and 2003 and a set of key characteristics of a Business Performance Management System.

Another useful resource is a research brief from 2006: MANAGEMENT CONTROL SYSTEMS AND STRATEGY: WHAT’S BEEN HAPPENING? by Basil TUCKER∗, Helen THORNE and Bruce GURD from the International Graduate School of Business, University of South Australia, Adelaide, Australia. It might be available on the website of the university. If not, try contacting Professor Bruce Gurd for a copy as I am not sure if it was published in a journal.

A third recommended article is: "How New Top Managers Use Control Systems as Levers of Strategic Renewal", Author(s): Robert Simons, Strategic Management Journal, Vol. 15, No. 3 (Mar., 1994), pp. 169-189

For a brief analysis of the topic see also: Performance Management Systems overview, a research brief available which proposes several examples.

Regards,

Aurel Brudan

As there's no accepted definition of "performance management systems", there's no simple answer to your question. "Performance management system" in an organisation could mean anything from employee appraisals to deploying a Balanced Scorecard across the entire company in an attempt to improve strategy execution.  You also need to distinguish between methodologies and the systems that support them. I very often see performance management methodologies adopted by executive management in response to the latest "fad" fall out of favour because they are not fully embedded in the ERP and reporting systems inside an organization. They are often replaced by another "fad".

I think the key reasons I have seen for changes in performance management methodologies tend to be either "fashion" related (what's the latest HBR research saying) or related to changes in executive management (the new CEO says we will do it this way). Very few organizations are able to effectively link their performance management methodology with their technology systems. Those that do tend to stick with a consistent approach and gradually adapt it over time.  One organization I worked with has been using a very effective performance management system (methodology based on the balanced scorecard tightly coupled with their operational, ERP, budgeting and reporting systems) for about 5 years. The PM system was introduced by a new CEO and the company has been very successful since implementing this system. This is gradually evolving and being refined as they learn more about what drives their business performance. 

Hello David Whyte,

I think most people use performance measurement at organization level, spcifically for profit-oriented. I came to know it is also a growing interest among those NGOs, I meant, political organization. Are you aware of this concept, 'future events exchange'?