Designing better performance measurement systems in universities using the business model canvas

This paper starts by critically reviewing the way in which universities design their measures of performance. We argue that the “one size fits all” performance measurement approach adopted by so many universities is not appropriate when departments have very different operating models. The paper proposes using “business model design” to enable university departments and centres to design and develop their own “sustainability model”, which in turn may help them develop more appropriate performance measurement systems. Using the lens of business model design may help universities to recognise their diversity and allow them to use performance measures more strategicall

Contemporary performance measurement systems: A review of their consequences and a framework for research

The main purpose of this paper is to develop a conceptual framework for understanding the literature on the consequences of contemporary performance measurement (CPM) systems and the theories that explain these consequences. The framework is based on an in-depth review of 76 empirical studies published in high-quality academic journals in the areas of accounting, operations, and strategy. The framework classifies the consequences of CPM into three categories: people's behaviour, organizational capabilities, and performance consequences. This paper discusses our current knowledge on the impact of CPM, highlighting inconsistencies and gaps as well as providing direction for future research

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

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

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

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

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

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

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 performanc

Reviewing and theorizing the unintended consequences of performance management systems

Different design choices in the controls used to manage performance often lead to a range of unintended consequences, which have profound effects on individuals and organizations. This paper presents a mixed review (both systematic and eclectic) of the literature on the unintended consequences of performance management systems and develops a typology to explain how and why they occur. It finds that the most salient unintended consequences of directive performance management systems are gaming, information manipulation, selective attention, illusion of control and relationships transformation. It argues that these consequences exist due to limiting factors such as ignorance, error, short-term concerns, fundamental values, self-fulfilling forecasts and changes in social relationships. The emerging typology-based theory suggests that the choice of control mechanisms is based on two key assumptions concerning goal-alignment and goal uncertainty that relate back to ideas in agency theory and stewardship theory. It concludes that, in the design of performance management systems, the more the ‘assumed’ reality about the state of goal-alignment and goal-uncertainty diverges from the ‘real’ state of affairs, the more the resultant system is likely to create perverse unintended consequences, leading to poor organisational outcomes

The performance impact of using measurement diversity in executives’ annual incentive systems

The purpose of this research is twofold. Firstly, it examines the relationship between the use of financial and non-financial performance measures in executives’ annual incentive systems and firm performance. Secondly, it looks at the extent to which this relationship is influenced by five different organisational contingencies (business risk, ownership structure, organisational culture, the quality of the performance measures used in executives’ annual incentives and the effectiveness of the executives’ reward system). Agency theory and contingency theory are used to develop the theoretical framework that underpins this study. The research design is based on survey and archival data from 132 private and publicly quoted organisations based in the UK. Data is studied using multivariate analysis, in particular, multiple regression analysis with main and interaction effects. Contrary to expectations, the study finds that the relationship between the use of financial and non-financial performance measures in executives’ annual incentives and economic firm performance (measured by return on assets and sales annual growth) is negative rather than positive. However, this relationship is not universalistic. Results suggest that when organisations operate in high or low business risk environments or when organisations have clan or adhocracy cultural values the use of multi-criteria performance measures in executives’ annual incentives is beneficial as it facilitates the achievement of business goals. Results also suggest that ownership structure, the quality of performance measures and the effectiveness of executives’ reward systems are organisational contingencies that do not influence the performance impact of using multi-criteria performance measures in executives’ annual incentive systems. This thesis contributes to the management literature; in particular, to the literature that looks at the use of non-financial performance measures in management control systems. It contributes to agency-based research by providing empirical evidence that refutes some of its premises regarding the use of multi-criteria performance measures in incentive systems. This thesis also contributes to contingency-based research as it supports the notion that there is no universally appropriate management control system –in this case, the executive incentive system– which applies equally to all organisations in all circumstances.EThOS - Electronic Theses Online ServiceGBUnited Kingdo

Revisiting benefits design approaches: the strategic value of identity-based benefits

When designing benefit offerings, organizations often frame the task as a trade-off: should we follow the market (do what others do) or should we rather focus on our employees’ preferences (let them choose)? In this paper, we contend that framing the problem as a dichotomy underplays the strategic role of benefits and ignores alternative approaches that could be more meaningful and effective. In the past, using benefits to communicate strategic intentions has proven a challenge. Based on recent research applying anthropomorphism ideas to organizations, we suggest an additional approach, which considers an organization’s identity in designing benefit offerings. With stakeholders increasingly expecting companies to position themselves as distinct players within a complex societal and environmental context, the concept of identity-based benefits presents itself as a powerful tool for sensemaking about “who the organization is” and for creating a fruitful connection between the organization and its stakeholders