Impact of Performance Measurement and Management Systems
Management Services › Vol. 54 Nbr. 3, October 2010
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Summary
The second part on the Impact of Performance Measurement and Management Systems is presented. The external effects of performance management systems (PMS) -- really, downstream impacts -- are reflected in customers' satisfaction, company reputation, plus regulators' and local councils' satisfaction. The researchers' analysis shows that PMS improved EDF Energy customers' perception. Despite some other researchers' findings, their research shows that it is extremely difficult to isolate the financial impact of PMS from other concurrent management initiatives. At the strategic level, some of EDF Energy's senior managers found that PMS can be somewhat mechanistic. At the tactical level too, the performance review process of PMS can be quite monotonous. Their analysis identified seven factors that influence the PMS effects on EDF Energy's performance. They are: 1. corporate principles and values, 2. local leadership, 3. top management commitment, 4. maturity of PMS, 5. underpinning performance management reviews, 6. accuracy of measures, and 7. involvement of employees in the solutions of operational problems.
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Impact of Performance Measurement and Management Systems
The external effects of performance management systems (PMS) - really, downstream impacts - are reflected in customers' satisfaction, company reputation, plus regulators' and local councils' satisfaction. (Figure 1 below) Our analysis shows that PMS improved EDF Energy customers' perception. Months after the PMS implementation, service trends show that customers notice the difference in service delivery. In some areas, complaint letters decreased and commendatory letters increased. Consequently, PMS has improved EDF Energy's reputation and image among institutions and competitors.
For example, take the comment from a DTI manager that: "The DTI regards EDF Energy as a company which has moved on from the traditional way energy companies operate to a business focused on service performance."Despite some ot...See the full content of this document
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