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Performance management system effectiveness in Australian local government

Performance management system effectiveness in Australian local government Purpose – The purpose of this paper is to examine the association between three organizational factors (the use of multi‐dimensional performance measures, link to rewards, and training) and three organizational culture dimensions (innovation, outcome orientation, and teamwork) with the effectiveness of performance management systems (PMSs). Design/methodology/approach – Data were collected by survey questionnaire from a random sample of 450 Australian local governments. Findings – The performance management systems of Australian local councils are only moderately effective in relation to performance related outcomes, and less effective in relation to the achievement of staff related outcomes. The results indicate a significant relationship between the use of multidimensional performance measures, link of performance to rewards, training and two organizational culture factors (team work/respect for people and outcome orientation) with the effectiveness of PMSs. Different factors were found to influence the effectiveness of PMSs for large and small sized councils. Practical implications – The findings imply that there is a need for the managers of local government councils to improve the effectiveness of their PMS. Originality/value – The study provides an initial empirical examination of the effectiveness of performance management systems and the influential factors in the Australian local government context. The study assists local government managers in effectively managing their employees and operations. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Pacific Accounting Review Emerald Publishing

Performance management system effectiveness in Australian local government

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Publisher
Emerald Publishing
Copyright
Copyright © 2012 Emerald Group Publishing Limited. All rights reserved.
ISSN
0114-0582
DOI
10.1108/01140581211258461
Publisher site
See Article on Publisher Site

Abstract

Purpose – The purpose of this paper is to examine the association between three organizational factors (the use of multi‐dimensional performance measures, link to rewards, and training) and three organizational culture dimensions (innovation, outcome orientation, and teamwork) with the effectiveness of performance management systems (PMSs). Design/methodology/approach – Data were collected by survey questionnaire from a random sample of 450 Australian local governments. Findings – The performance management systems of Australian local councils are only moderately effective in relation to performance related outcomes, and less effective in relation to the achievement of staff related outcomes. The results indicate a significant relationship between the use of multidimensional performance measures, link of performance to rewards, training and two organizational culture factors (team work/respect for people and outcome orientation) with the effectiveness of PMSs. Different factors were found to influence the effectiveness of PMSs for large and small sized councils. Practical implications – The findings imply that there is a need for the managers of local government councils to improve the effectiveness of their PMS. Originality/value – The study provides an initial empirical examination of the effectiveness of performance management systems and the influential factors in the Australian local government context. The study assists local government managers in effectively managing their employees and operations.

Journal

Pacific Accounting Review – Emerald Publishing

Published: Sep 7, 2012

Keywords: Performance management system; Multi‐dimensional performance measures; Local government; Culture dimensions; Organizational dimensions; Performance management; Australia

References

  • Population Size and Local Authority Performance
    Andrews, R.; Boyne, G.; Chen, A.; Martin, S.
  • External constraints on local service standards: the case of comprehensive performance assessment in English local government
    Andrews, R.; Boyne, G.; Law, J.; Walker, R.
  • Performance Management Handbook
    Armstrong, M.; Baron, A.
  • Management Accounting
    Atkinson, A.A.; Banker, R.D.; Kaplan, R.S.; Young, S.M.
  • Performance Measurement as a Tool for Modernising Government
    Audit Commission
  • Performance measures for councils
    Australian Government Productivity Commission