Balancing Measures: Best Practices in Performance Management

In its August 1999 report, Balancing Measures: Best Practices in Performance Management, the National Partnership for Reinventing Government (NPR) convincingly argues for using a balanced measures approach to managing organizational performance. Through lessons learned, best practices, and examples, the report presents overwhelming evidence that public as well as private sector organizations benefit from using a balanced set of measures. This report provides Federal managers with ideas and suggestions for improving organizational performance using balanced measures.

Balanced Organizational Measures

The report explains that balancing measures is a strategic management system for achieving long-term goals. Organizations using a "family of measures" to create this balance consider the perspectives of their customers, stakeholders, and employees while achieving a specific mission or result. Best practices for using balanced measures include:

• establishing a results-oriented set of measures that balances business goals, customer needs and satisfaction, and employee involvement, development, and satisfaction with working conditions;
• establishing accountability at all levels of the organization, through leading by example, cascading accountability, and keeping everyone informed;
• collecting, using and analyzing performance data, which includes providing feedback;
• connecting performance management efforts to the organization's business plan and budget; and
• sharing the leadership role, which strengthens the continuity of the performance management process despite changes in top management.

Using a Balanced Measures Approach Affects Employee Performance Management

Many of the best practices of balancing organizational measures cited by NPR's report significantly affect employee performance management methods and processes, including:

• Cascading Accountability. NPR describes organizations that use performance agreements with agency heads, who then cascade those objectives to subordinate managers. These agencies then cascade accountability to each employee, using their performance plans to document goals and objectives. Achieving organizational goals is a team effort and everyone in the organization must be held responsible for their part of the work. (For more information about how to cascade organizational goals to employee performance plans, look at our publication A Handbook for Measuring Employee Performance: Aligning Employee Performance Plans with Organizational Goals, which you can download from our web pages.
• Involving Employees. Involving employees in the planning process makes them feel part of a team, creates buy-in, and improves communication. Where bargaining units exist, including unions in the planning process ensures that accountability is cascaded to every level of employee within the organization.
• Keeping Employees Informed. NPR reports that the organizations successfully using balanced measures make a concerted effort to ensure constant communication with employees about organizational performance. In addition to using the Internet on a regular basis, they rely on newsletters, emails, reports, staff meetings, and other tools and methods to communicate organizational performance data to employees.
• Rewarding Employees. When organizations hold employees accountable through established expectations, they should reward individuals who exceed those expectations. Ways of recognizing employees, in addition to granting cash awards, include: giving non-monetary recognition; granting time-off awards; reallocating discretionary funds to high performers for training and new equipment; and recognizing team performance.