Monica Franco-Santos

Towards a definition of a business performance measurement system

Purpose – Scholars in the field of performance measurement tend to use the term business performance measurement (BPM) systems without explaining exactly what they mean by it. This lack of clarity creates confusion and comparability issues, and makes it difficult for researchers to build on one an each others work. The purpose of this paper is to identify the key characteristics of a BPM system, by reviewing the different definitions of a BPM system that exist in the literature. This work aims to open a debate on what are the necessary and sufficient conditions of a BPM system. It is also hoped that a greater level of clarity in the performance measurement research arena will be encouraged.Design/methodology/approach – The performance measurement literature is reviewed using a systematic approach.Findings – Based on this research, a set of conditions of a BPM system has been proposed from which researchers can choose those which are necessary and sufficient conditions for their studies.Research limitatio...

Managing through measures: a study of impact on performance

Purpose – This study investigates the use of performance measures and how performance measurement impacts performance.Design/methodology/approach – This study was conducted through multiple case studies in a single organisation. Comparisons are made between performance measurement practices in comparable high and average‐performing business units.Findings – The findings suggest that current research into the impact of performance measurement on performance may be too simplistic in its approach as much of the research relies on studying the physical and formal systems used, ignoring the types of factors found to be important in this study.Research limitations/implications – Being based on a single organisation, the wider applicability of the specific findings from this study should be questioned. However, if, as we suggest, the interactive nature of the use of the measurement system is important, future research will need to find ways of observing, measuring and quantifying this interactivity to allow a ri...

An examination of the literature relating to issues affecting how companies manage through measures

In the last decade, organizations have devoted enormous time and effort to the development of business performance measurement (BPM) systems. Many articles have been written on how to design and implement these types of systems. However, few studies have addressed the issue of why some organizations are better able to ‘manage through measures’ than others. In other words, why do some organizations struggle to ensure that action follows measurement, whilst others systematically use their metrics to inform their decision-making processes, and their subsequent actions? This paper aims to contribute to a more complete understanding of the use of BPM systems by reviewing the performance measurement literature developed in the management arena. It differs from previous examinations of performance measurement and management control systems in that it uses a broader scope and follows a new method of literature review applied to management research, namely, systematic review. The paper focuses on the thematic analysis of the review only. The insights extracted from the literature are articulated and presented in a management framework. In addition, the paper identifies different gaps in the literature that require further research.

Generating organisational performance

Purpose – This paper aims to advance the current debates on the effect of performance measurement (PM) in the operations management domain. In order to accomplish that, it investigates the contribution of business PM and human resource management (HRM) practices to business performance. Design/methodology/approach – The paper is based on ten case studies conducted across both manufacturing and service organisations capturing evidence from both the human resource function and line management. Findings – In the PM and HRM literatures, there is a debate about the contribution these practices make to the overall performance of the organisation. In particular, the results from the PM literature are inconclusive. This paper argues that performance is a result of employee engagement and that the PM system is a communication and guiding mechanism, which if implemented well and used appropriately, can channel the efforts of employees striving to perform. Originality/value – This paper contradicts the performance d...

Executive pay and performance measurement practices in the UK

The use of performance measurement systems and the balanced scorecard has been on the increase, and there is now a trend amongst practitioners and academics to prescribe that rewards should be linked to the measurement system. However, little research has been done in this area. This paper reports the results of a recent survey of executive reward practices in large companies based in the UK. Senior HR professionals and reward specialists were approached to provide details of performance measurement and reward practices in their own organizations, and to give their opinions on the benefits of such an approach.

Performance management and well-being: a close look at the changing nature of the UK higher education workplace

Abstract The relationship between HRM and well-being has received a significant amount of research attention; however, results are still contested. Our study addresses this phenomenon in the Higher Education sector. We specifically investigate the association between performance management and the perceived well-being of academic staff. Our research finds that the application of a directive performance management approach, underpinned by agency theory ideas as evidenced by a high reliance on performance measures and targets, is negatively related to academics’ well-being (i.e. the more it is used, the worse people feel). In contrast, an enabling performance management approach, based on the learnings of stewardship theory, emphasising staff involvement, communication and development, is positively related to academics’ well-being. We also find the positive relationship between enabling practices and well-being is mediated by how academics experience their work (i.e. their perceptions of job demands, job control and management support). These results indicate that current trends to intensify the use of directive performance management can have consequences on the energy and health of academics, which may influence their motivation and willingness to stay in the profession. This research suggests that an enabling approach to managing performance in this context, may have more positive effects.

Modelling the impact of performance management practices on firm performance: interaction with human resource management practices

Abstract The paper draws on resource orchestration theory to investigate whether and how performance management (PM) practices interact with human resource management (HRM) practices in organisations as well as how this interaction affects firm performance. The proposed theoretical model was tested through a survey of 192 UK firms using Partial Least Squares approach for structural equations modelling. The findings show that the effect of PM practices on firm performance is better explained when the interaction between these practices and other organisational practices is considered. In particular, we examine the extent to which the interaction between PM practices and commitment-based HRM practices affects performance. We find that when HRM practices and PM practices are misaligned, their effect on performance can be negative. This is the first paper in the PM literature that establishes the relationship between PM and HRM practices in organisations and demonstrates the effect of this relationship on firm performance.

Governance and Well-being in Academia: Negative Consequences of Applying an Agency Theory Logic in Higher Education

This study examines the relationship between alternative university governance practices and staff well-being. Specifically, it investigates how people in academic and professional services roles are managed and how various governance mechanisms such as the use of performance measures and targets influence their sense of vitality and stress. Drawing from agency theory and stewardship theory research, the authors expected universities to align their governance practices to the nature of their employment roles to enhance well-being. Based on data collected in the UK, the authors find that, for some academic roles, there is a misalignment between the responsibilities and job demands and the way institutions govern people in such roles, which is shown to affect their well-being. These results suggest that well-being responses to governance mechanisms change, depending on the role an employee performs and the position he or she occupies. Interestingly, these data suggest that the governance and well-being experiences of academic leaders are more closely aligned with those of professional service leaders than with those of academics without leadership positions. Taking these data together, this investigation notes several shortcomings in the internal governance practices of higher-education institutions that can have unexpected consequences and require close attention and further research.

Performance measurement and management : a system of systems perspective

Despite changes in tools and practices, the conceptual foundations of performance measurement and management (PMM) are still predominantly rooted in control systems research. While PMM approaches have delivered significant organisational benefits, including creating alignment, supporting monitoring and control, and enabling prediction and optimisation of resource allocation, this paper argues that this paradigm is not capable of responding to increasingly complex and highly uncertain organisational environments. Drawing on ideas emerging in the literature on systems engineering and complex systems, we propose a novel perspective that considers PMM from a ‘system of systems’ (SoS) point of view, whose essential characteristics are autonomy, belonging, connectivity, diversity and emergence. After identifying the assumptions underpinning existing PMM approaches, we outline a SoS-based paradigm to PMM and conclude by articulating the main implications for the practice of PMM and setting out a research agenda.

The Impact of Sales Performance Goals on Behaviors: Enhancing or Compromising Sustainable Performance?

Performance goals or quotas, also termed targets, are extensively used by sales organizations despite the fact that their impact on behavior and sustainable performance is questioned in the literature. Performance goals define a ‘desired’, ‘promised’, ‘minimum’ or ‘aspirational’ level of performance, for example, to attain 10 percent more of profits, usually within a specified time period. About 95 percent of Fortune 500 companies use performance goals in their sales compensation schemes (Joseph and Kalwani, 1998). Zoltners et al. (2008) estimate that sales compensation in the US economy totals about