Several studies highlight that the use of performance information allows organisations to improve performance and enhance accountability (Folz et al., 2009; Julnes, 2006; Kopczynski & Lombardo, 1999; Moynihan, 2009; Poister, Pasha, et al., 2013; Van Dooren et al., 2010). Previous studies have also listed the specific use of performance information, such as: to develop strategy; to plan and set targets; to allocates resources; to draw up program priorities; to establish milestones; to provide feedback; to review; to improve the management of program operations; to change the work processes; to set new or revisit existing performance goals; to reward government employees and develop and manage contracts (ANAO, 1996; GAO, 2008). Hatry (2006) also promoted the use of performance information for: delegating greater authority and flexibility; creating non-financial incentives for improved program performance; creating financial incentives for effective organisational performance; and providing training and technical assistance.
While there is an extensive number of studies on the use of performance information, little is known about how it is used in implementing programs and activities. The existing studies predominantly address its use in planning (ANAO, 2002; GAO, 2008) and evaluation processes. Few studies examine how performance information is used in the implementation stage. Three purposes of performance information use in the implementation stage have been highlighted by Behn (2003): to motivate staff, to learn, and to celebrate. However, studies do not give detailed explanations as to how the information is used.
This section compares and contrasts the use of performance information in the implementation stage of the management cycle in the three offices. The discussion addresses RQ1 and RQ2: which information the managers used; and how the information was used.
5.4.1 Which information did managers use? (RQ1)
The individual cases presented all used KPIs and output indicators. The alignment of the use of performance information with the four BSC perspectives in the implementation stage (refer to the red line in Figure 5-1) is similar to that in the planning stage, as discussed in Chapter 4. Table 5-1 compares and contrasts the use of performance information in the three offices aligned with the four BSC perspectives. The shaded areas in the table indicate the use of performance information in the
three offices for each perspective of the BSC. This table also lays a foundation for examining the actual use of performance information in the three offices against the framework for the use of performance information in the implementation stage (refer to Figure 5-1).
Table 5-1: Summary of the use of KPIs and output indicators in the three offices Performance
information
Customer Internal business process Learning and growth Financial Others KPIs ALPHA BETA GAMMA Output ALPHA BETA GAMMA
It is clear from Table 5-1 that the three offices used KPIs in the implementation stage of the management cycle. As already stated, the KPIs used in this stage are similar to those utilized in the planning stage. In the planning stage, ALPHA’s and BETA’s KPIs aligned with the four perspectives of the BSC (customer, internal business process, learning and growth, and financial), while BOTM’s KPIs only aligned with three BSC perspectives (customer, learning and growth, and financial). In the implementation stage of the management cycle, the three offices consistently used these KPIs. Further discussion on how the KPIs are used by the managers of the three offices is presented in Section 5.4.2.
The three offices also used output indicators in the implementation stage to execute their strategic plans. Programs and activities approved in the budget documents were carried out in this stage. In general, the three offices’ output indicators addressed the four perspectives of the BSC in the planning stage, as discussed in Chapter 4. However, GAMMA did not develop KPIs relating to the learning and growth perspective, despite the office designing programs for improving the capacity and discipline of its employees. GAMMA also created activities along with their output indicators to run these programs (refer to Section 4.4.1. in Chapter 4). However, in 2014, GAMMA did not receive a budget allocation for implementing these programs and, as a result, failed to execute programs and activities contained in its strategic plan. The inability of GAMMA to complete the activities indicates that output indicators for the activities related to improving the capacity of employees were not used by the managers. Further discussion on how the managers used output indicators is presented in Section 5.4.2.
In the implementation stage of the management cycle, the three offices not only used the KPIs and output indicators as presented in their planning documents (referred to in this study as formal performance information), they also used informal performance information This included media coverage, information from the internet and the mayor, and observations from staff and managers. Table 5-2 summarises and compares the use of informal performance information in the three offices. Five types of informal performance information were used by the managers in the three offices in the implementation stage.
Table 5-2: The use of informal performance information in the implementation stage
Source of Information ALPHA BETA GAMMA
Media coverage N/A
The media coverage influences the visitor's decision to come to the city so managers need to cooperate with the media
N/A
Internet Citizen complaints Social media N/A
Staff observations
Staff oversight of the dirty spots in the city
N/A
Staff observation on collecting data regarding the price of commodities Staff observation for
maintaining the trucks
Managers’ observations
The Secretary conducts observations for attendance Information gathered from monitoring is necessary to strengthen tourism businesses Information gathered from monitoring is required to strengthen small and medium enterprises Mayor’s/Regent’s
communication The use of WhatsApp to provide prompt responses
Face-to-face weekly meeting
It is clear from Table 5-2 that the three offices used different types of informal performance information. Even within the same local government, different types of informal performance information were used. Media coverage was used extensively by BETA’s manager, while ALPHA and GAMMA did not consider its importance in the implementation of their plans. Also, the internet provided information for ALPHA’s and BETA’s managers in delivering their day-to-day services, while GAMMA’s managers did not take this into account in executing their programs and activities. Staff observation was used by ALPHA, but not by BETA, despite them both being working units of LGA. GAMMA’s manager also reaped the benefits of using staff observations.
All three offices used information generated by observations during programs and activities in the implementation stage. The other type of informal performance information used in common was communication with the Mayor/Regent. The Mayor’s establishment of a WhatsApp group for communicating with the working unit heads in LGA provided useful information for ALPHA’s and
BETA’s managers to improve their service delivery. The LGB Regent also actively conducted ‘coffee morning’ meetings with working unit heads every Monday, producing useful information that the unit heads would pass on to managers.
A comparison on the use of performance information in the three offices suggests that KPIs, output indicators, and informal performance information were used in the implementation stage of the management cycle. However, the level of alignment of the formal performance information (KPIs and output indicators) with the four BSC perspectives differed (refer to Table 5-1). ALPHA’s and BETA’s managers used KPIs and output indicators aligned with the four perspectives, while GAMMA’s managers aligned theirs with only three perspectives. The three offices also used different types of informal performance information.