B.A.C. Groen

Enabling performance measurement in a small professional service firm.

Purpose - The purpose of this paper is to show why developing an enabling performance measurement system (PMS) can be useful to small professional service firms (PSFs) and how small PSFs can develop such an enabling PMS. Design/methodology/approach - The authors used a process-consultation type of action research design; they developed an enabling PMS in close cooperation with the employees of a small PSF. The effects of this intervention were assessed by means of document analysis, participant observation, and individual/group interviews. Findings - The enabling PMS development process helped the firm deal with three challenges common to small PSFs: it increased employees’ understanding about how to apply the firms strategy; it led to greater knowledge exchange among employees; and it enabled them to create new knowledge. Research implications/limitations - The research results suggest the type of intervention used for developing an enabling PMS – that has already been shown to be effective in large firms – may also be useful for small PSFs. Similarities and differences with the intervention in large firms are discussed. Practical implications - Small PSFs may benefit from the approach described herein: to develop a PMS in a participatory manner. It is especially useful if interested in better alignment of operations with strategy and/or to better explicate tacit and create new firm-relevant knowledge. Originality/value - This is the first paper about developing an enabling PMS in a small PSF.

Enabling employees through co-development of performance measures

Various studies have demonstrated that involving employees in the development of performance measures can lead to improved employee performance. Yet to date it is unclear how such performance improvement comes about. In order to enable companies to improve the performance of their employees, this dissertation examines how employee participation in developing performance measures can lead to better employee job performance. Two explanatory models are developed and tested in three different studies: one action study in a beverage manufacturing company and two survey studies among employees and their managers in various jobs, organizations and industries. These models demonstrate that both the participating employees and their managers perceive the co-developed performance measures to be of better quality. Based on the theory of planned behavior, the first two studies suggest that high-quality performance measures enable employees to perform better, mainly because they increase employees’ own sense of control to perform well. In addition—taking both the agency and self-determination theory into account—the third study suggests that employee job performance can be increased if managers use high-quality performance measures for evaluation purposes, rather than for explicit, monetary or nonmonetary type of rewards. Implications of the studies for management research and practice are discussed and a research agenda is given. Relevance for organizations This dissertation illustrates the dos and don’ts for improving employee job performance through co-developing performance measures together with employees. It includes a detailed description of how to design such a co-development project.