Effectiveness of performance management systems in state agencies: Performance measurement, organizational culture and learning

Most state governments have implemented performance management systems that incorporate some or all elements of a typical system, specifically strategic planning, performance measures, reporting, budgeting and evaluation. These systems are attempts to enhance government efficiency and effectiveness according to the principles of New Public Management. Despite mixed evidence of success, pressure on practitioners for use of these systems is growing, particularly from the federal government, governance entities, external funding sources and professional associations. By surveying state agency leaders across the nation, this research tests a model of performance measurement effectiveness.;This study attempts to advance theory and practice by assessing factors both internal and external to a state agency that may positively impact the managerial effectiveness of a performance measurement system. This study adds knowledge to the literature by testing a middle-range theory of the effectiveness of performance measurement based on a nation-wide survey of leaders of selected state government agencies. While certain variables have direct impact on performance measurement effectiveness, other effects are indirect; this empirical study helps to better understand these mechanisms. The study adds to the body of knowledge in the literature by incorporating organizational culture into management reform in state government and demonstrates that certain elements for success can be common among different types of agencies. Given the traditional rule bound culture of government, a better understanding of the role of innovation, along with the characteristics of innovation, in achieving performance management effectiveness can be useful. The role of organizational learning is explored. The importance of organizational support, technical training and stakeholder participation in state government are reinforced in the results of this study. Sophisticated and creative approaches to management and learning are needed to maximize the effectiveness of these systems; these successes may be most likely to be achieved in the long-run.