 RESEARCH AT CRANFIELD SCHOOL OF MANAGEMENT
RESEARCH SUMMARY
EXPLAINING THE EFFECTS OF PERFORMANCE MEASUREMENT ON PERFORMANCE AN ORGANIZATIONAL ROUTINES PERSPECTIVE
Dr Andrey Pavlov
Centre for Business Performance
consist
of planning,
measurement,
feedback
The article valuably points to a way in which
the effect
of performance
measurement
rewards
can be madeand
more
visible.with the latter two triggered by
Performance measurement clearly has a
powerful impact on organizations but its effect
is far from predictable and is poorly
understood. The problem to be solved is
discovering the contents and mechanisms of
the “black box” that sits between performance
measurement and its outcome. For Pavlov
and Bourne this “black box” contains multiple
organizational processes that deliver
performance. In this theoretical article the
authors explore the literature on Management
Control Systems, Management Accounting
and Organizational Routines to understand
how the impact of performance measurement
on performance can be understood by looking
at changes in organizational routines.
Management Control Systems go back to the
early twentieth century management idea that
control is essential to operational efficiency.
Building control over the way work is
performed and standardising the processes for
delivering it becomes the essence of
operational management supported by
performance measurement. The systems
consist of planning, measurement, feedback
and rewards with the latter two triggered by
action. Performance measurement is used to
provide information on past performance and
communicate the direction of future
performance. For Management Accounting a
process of measurement, reflection and action
is engendered for identifying the drivers of
performance.
The ‘Organizational Routines’ perspective
sees organizations as a complex set of
processes. The routines determine what the
organization is. Routines have arguably
evolved in response to performance feedback.
If performance is unsatisfactory the routine is
likely to change which means that routines are
sensitive to environmental impact. Routines
are both patterns of behaviour and mental
models in that routines change as people
reflect on what they are doing and then use
that reflection to change the way they act. The
organizational routines perspective is
invaluable for examining the effect of
performance measurement because changes
RESEARCH AT CRANFIELD SCHOOL OF MANAGEMENT
to routines provide the visible manifestation of
its impact. In other words routines reveal the
contents of the “black box” and what is learned
from organizational performance brings
change to routines.
This works in three ways. Firstly, when
performance falls below the target level,
performance measurement triggers a change
in routine. Secondly, in feeding forward
performance information it provides guidance
on the shape of future performance. In other
words measures focus attention on what
needs to change. Thirdly, it intensifies the
process of changes to routines as it drives the
iterations between thinking and acting.
WATCH THE VIDEO INTERVIEW
http://tinyurl.com/amfpmrq
The article valuably points to a way in which
the effect of performance measurement can
be made more visible. To gain a better
understanding of the relationship between
routines and performance measurement future
research could examine in more detail the
impact of performance measurement on both
the cognitive and behavioural aspects of
routines.
Pavlov, A. & Bourne, M. 2011, ‘Explaining
the effects of performance measurement on
performance - an organizational routines
perspective’,
International
Journal paper
of
For
further details
on this research
Operations
andandrey.pavolv@cranfield.ac.uk
Production Management,
please
contact:
vol. 31, no. 1, pp 101-122.
Management Theme: Business
Performance Management
MANAGEMENT THEMES AT CRANFIELD SCHOOL OF MANAGEMENT
 Business Economics and Finance
 Business Performance Management
 Corporate Responsibility and Sustainability
 Entrepreneurship and Business Growth
 General Management
 Information Systems
 Innovation and Operations Management
 Leadership
 Managing People and Global Careers
 Marketing, Sales and Client Relationships
 Programme and Project Management
 Strategy, Complexity and Change Management
 Supply Chain and Logistics Management