Applying System Dynamics Modeling To Foster a Causeand- Effect Perspective in Dealing with Behavioral Distortions Associated with a City’s Performance Measurement Programs (original) (raw)
Related papers
2013
This paper aims to show how applying the system dynamics methodology to performance management can provide public sector organizations a powerful modeling perspective to prevent, detect and counteract behavioral distortions associated to performance measurement. A dynamic performance management approach is able to support performance management system designers to outline and implement a consistent set of measures that can allow public sector decision makers to pursue sustainable organizational learning and development. This perspective implies a major shift from a static to a dynamic picture of organizational processes and results. This means framing delays between causes and effects, feedback loops, and trade-offs in time and space associated with alternative scenarios. It also means understanding how different policy levers impact the accumulation and depletion of strategic resources over time, and determining how performance drivers affect end-results. An application of this perspective is outlined, in relation to crime control policies at Municipal level. Concerning this, unintended behavioral consequences generated by the implementation of the Compstat program (at the New York Police Department) on reward and performance management systems are framed through the ‘lenses’ of dynamic performance management.
Improving Public Sector Performance and Fostering Accountability through System Dynamics Modelling
The 2nd Summer School in Improving Public Sector Performance and Fostering Accountability through System Dynamics Modelling: a Strategic Planning & Control Perspective is an elective course offered by the University of Palermo (Italy). It also is part of the curriculum of our International Ph.D. program in “Model Based Public Planning, Policy Design and Management,” which is jointly run with the Universities of Bergen (Norway) and Nijmegen (Holland). The Summer School follows the successful experience of last year’s Summer School, when we hosted 21 participants in Ustica (a flourishing island located 60 kms North of Palermo) from different parts of the world (Brazil, Egypt, Holland, Mozambique, Norway, Poland, Venezuela, and Italy) on the topic of “Model Based Public Planning, Policy Design, and Management: a System Dynamics approach.” This year the Summer School will focus a different—though related—subject. We aim to cover the topic of public sector performance, framing this subject around the viewpoints of different public sector industries. Examples and peculiarities of System Dynamics applications to specific industries (Health Care, Public Utilities, Energy, Housing, Public Works, Social Services, etc.) will be provided, and participants will be involved in working with teams to apply System Dynamics modelling to their own research fields. The School also will focus on research issues and research methodologies in Planning & Control and Modelling & Decision-Making in the Public Sector. The Summer School will be held at the “Addaura Hotel” (http://www.addaura.it/engl/) which is located 150 meters from the sea in the beautiful gulf of Mondello (Palermo).
While some scholars have suggested that the forces of New Public Management are now in decline (Hughes, 2003), a clear success story of this reform is the use of performance measurement in the public sector for tracking the outputs and outcomes of service delivery. In fact, research has demonstrated that well-managed performance measurement systems are critical for accurately and systematically demonstrating operational accountability in governmental organizations (Rivenbark, 2007). However, we must be cautious in how we think about the use of performance measurement systems because of their two distinct parts as described by de Lancer Jules and Holzer (2001). The first part involves adoption, where public officials develop performance measures, track them over time, and report them on a periodic basis. The second part involves implementation, where public officials actually use performance information to make policy and process changes for improving service delivery. The problem is that success is clearly more associated with adoption rather than implementation. Ammons and Rivenbark (2008) addressed this issue by studying the patterns of implementation from fourteen municipalities associated with the North Carolina Benchmarking Project. While the authors concluded that the record of these municipalities actually using performance data remains modest, certain factors did emerge that promoted the move from adoption to implementation of performance measurement systems. They included the focus on the higher-order measures of efficiency and effectiveness, the willingness to benchmark against other organizations, and the need to imbed performance measures within other management systems. A more recent study also suggests that managerial involvement in the Government Performance and Results Act (GPRA) of 1993 and the Program Assessment Tool (PART) has produced relatively few aspects of performance information use in federal agencies (Moynihan and Lavertu, 2012). This research, however, identified a number of organizational factors that increase the likelihood of using performance data, including leadership commitment to results (Behn, 1991; Kotter and Heskett, 1992; Moynihan and Ingraham, 2004), learning routines led by supervisors, and the ability to link measures to actions. One possible avenue to enhance performance management in the public sector—which is the term used for the implementation of performance measurement as described by de Lancer Jules and Holzer (2001)—is the application of system dynamics, where modeling organizational systems and using simulation techniques are used for understanding the behavior of complex systems. This line of inquiry builds on the research of Ghaffarzadegan, Lyneis, and Richardson (2011), where small system dynamics models were used to enhance public policy, decision-making. The advantage of using this approach is placing performance measures into the broader context of the system, responding to the reality that even simple policy and process changes to impact specific outputs and outcomes are not likely to be that “simple” in organizations (Bianchi, Winch, and Tomaselli, 2008). There also is another possible advantage to the approach. Rather than looking for factors that promote data use, system dynamics may give insights to factors that prevent data use. The purpose of this paper is to demonstrate how system dynamics can be used to enrich performance management in local government, focusing specifically on how the development of conceptual and simulation system dynamic models can foster a common shared view of the relevant system among stakeholders to overcome factors that limit data use. We begin this paper by describing the background of a residential refuse collection program in a North Carolina municipality, including how specific performance measures were used to make changes in service delivery. After discussing the methodology of using system dynamics to enhance performance management, we present our case on how key drivers can be used to foster a shared view of the residential refuse collection system for supporting policy and process changes. In other words, our goal is to show how a systems approach can help public officials move from performance adoption to performance implementation. We conclude this paper by identifying several possibilities of how system dynamics can be used to improve the quality of performance management in local government
Towards a dynamic feedback framework for public sector performance management
… System Dynamics & …, 1999
The paper discusses a joint research program by CSC(Aust) and the Australian Defence Force Academy which seeks to bring to the area of Public Sector corporate performance management an holistic approach using soft systems and systems dynamics and drawing upon Kaplan and Norton's Balanced Scorecard (BSC). The implementation and understanding of the BSC has drawn too heavily upon the accounting discipline and its backward looking information sources, despite Kaplan and Norton's emphasis on forward indicators. Practitioners find implementation very difficult across all industry sectors. We suggest that this emerges from an inappropriate strategic management framework as well as technology support issues which mean that reporting and maintenance are labour intensive. More fundamentally, the BSC is essentially a static representation of a complex dynamic system, and it ignores the requirement for business rules for acting on its output.
Dynamic Feedback Framework for Public Sector Performance Management
The paper discusses a joint research program by CSC(Aust) and the Australian Defence Force Academy which seeks to bring to the area of Public Sector corporate performance management an holistic approach using soft systems and systems dynamics and drawing upon Kaplan and Norton’s Balanced Scorecard (BSC). The implementation and understanding of the BSC has drawn too heavily upon the accounting discipline and its backward looking information sources, despite Kaplan and Norton’s emphasis on forward indicators. Practitioners find implementation very difficult across all industry sectors. We suggest that this emerges from an inappropriate strategic management framework as well as technology support issues which mean that reporting and maintenance are labour intensive. More fundamentally, the BSC is essentially a static representation of a complex dynamic system, and it ignores the requirement for business rules for acting on its output. ___________________________________________
A systems perspective of performance management in public sector organisations
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Incentives and their dynamics in public sector performance management systems
Journal of Policy Analysis and Management, 2010
We use the principal-agent model as a focal theoretical frame for synthesizing what we know both theoretically and empirically about the design and dynamics of the implementation of performance management systems in the public sector. In this context, we review the growing body of evidence about how performance measurement and incentive systems function in practice and how individuals and organizations respond and adapt to them over time, drawing primarily on examples from performance measurement systems in public education and social welfare programs. We also describe a dynamic framework for performance measurement systems that takes into account strategic behavior of individuals over time, learning about production functions and individual responses, accountability pressures, and the use of information about the relationship of measured performance to value-added. Implications are discussed and recommendations derived for improving public sector performance measurement systems.
Fragmentation and pillarization of the public sector is one of the results arising from the implementation of New Public Management reform. A multi-level governance structure carries the risk of generating ‘wicked’ problems directly affecting the performance of organizations providing public services. The focus of this paper is to examine how such a governance structure could impose several constraints on the management of public agencies. The analysis has been conducted through a Dynamic Performance Management approach, which combines the traditional Planning and Control tools with System Dynamics modelling. An Italian case study has been provided as a basis for discussion.
PERFORMANCE MANAGEMENT IN POLICE ORGANIZATIONS
The central purpose of this study is to examine the implementation of a popular performance based management model known as Compstat in large police organization called Newark Police Department. The main question is if this model has improved the performance of this organization. This model has been implemented by numerous police organizations in the United States over the last decade. Data were collected in this case study through in-depth interviews, observation of the Compstat meetings and analysis of the documents, and analyzed using grounded theory. The study revealed that this model certainly improved the performance of the NPD. Accountability and responsibility, flexibility, performance measurement that leads to careerism and competition can be seen as new management values that emerged in Compstat era. Performance orientation became an inevitable part of police management. Two basic mechanisms in Compstat, assessment with tangible indicators and follow up, changed the evaluation of success and failure in the management. The findings suggest designing differently the structure and setting of the Compstat meetings in a way to spur brain storming and promote a learning environment.
The use of performance measurement systems in the public sector: Effects on performance
We study the use of performance measurement systems in the public sector. We hypothesize that the way in which these systems are being used affects organizational performance, and that these performance effects depend on contractibility. Contractibility encompasses clarity of goals, the ability to select undistorted performance metrics, and the degree to which managers know and control the transformation process. We expect that public sector organizations that use their performance measurement systems in ways that match the characteristics of their activities outperform those that fail to achieve such fit. We test our hypotheses using survey data from 101 public sector organizations. Our findings indicate that contractibility moderates the relationship between the incentive-oriented use of the performance measurement system and performance. Using the performance measurement system for incentive purposes negatively influences organizational performance, but this effect is less severe when contractibility is high. We also find that an exploratory use of the performance measurement system tends to enhance performance; this positive effect is independent of the level of contractibility. The effectiveness of the introduction of performance measurement systems in public sector organizations thus depends both on contractibility and on how the system is being used by managers. These findings have important implications, both for practice and for public policy.