ESTABLISHING A PERFORMANCE-BASED MANAGEMENT PROGRAM
Jeffrey A. Long
Manager, Quality Support Systems
UT-Battelle, LLC
Oak Ridge National Laboratory
Oak Ridge, TN 37831-6052
What is Performance-Based Management?
Performance-based management is a systematic approach to performance improvement
through an ongoing process of establishing strategic performance objectives; measuring
performance; collecting, analyzing, reviewing, and reporting performance data; and using
that data to drive performance improvement.
Why should you establish a Performance-Based Management program?
 Performance-based management improves the management and delivery of products
and services.
 Performance-based management improves communications internally among
employees, as well as externally between the organization and its customers and
stakeholders.
 Performance-based management helps justify programs and their costs.
 Performance-based management demonstrates the accountability of stewardship of
taxpayer resources.
 Performance-based management is mandated for government agencies by the
Government Performance and Results Act (GPRA) of 1993 and is central to other
legislation and Administration initiatives. Contractor planning should align with the
GPRA-based planning framework.
Establishing a Performance-Based Management program at ORNL
ORNL is a multiprogram science and technology laboratory managed for the U.S.
Department of Energy by UT-Battelle, LLC. Scientists and engineers at ORNL conduct
basic and applied research and development to create scientific knowledge and
technological solutions that strengthen the nation's leadership in key areas of science;
increase the availability of clean, abundant energy; restore and protect the environment;
and contribute to national security.
ORNL also performs other work for the Department of Energy, including isotope
production, information management, and technical program management, and provides
research and technical assistance to other organizations.
In April of 2000, ORNL management began the process of establishing a performancebased management program in cooperation with its DOE customer. Performance-based
management at ORNL is a management system – part of a set of systems that define the
highest level operating and business processes in the Laboratory. The PerformanceBased Management System (PBMS) defines the inputs, outputs, processes, roles,
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responsibilities, authorities, and accountabilities for all aspects of performance-based
management at ORNL.
PBMS is implemented at ORNL utilizing four key processes and their deployment
mechanisms, which are somewhat similar to the Shewart PDCA Cycle (Plan-Do-CheckAct).
1. Performance Planning
- Determine Objectives
and Indicators ( POI’s )
2. Assessment - Monitor
Performance against
POI’s
4. Feedback - Implement
Improvements
3. Evaluation - Evaluate
Performance against target
expectations
PBMS Key Processes and Deployment Mechanisms
1. Determining Performance Objectives and Indicators (Performance Planning)
The first process of PBMS is the development of performance objectives and indicators
(POIs), those items management wishes to measure because they are important for the
success of the enterprise. Critical outcomes are identified by Laboratory management to
focus the efforts of all staff members toward achievement of the strategic plan set forth in
the Laboratory Agenda which is based on flowdown of initiatives through the DOE
strategic planning process and the ORNL Institutional Plan. During the annual business
planning cycle the DOE and Laboratory directorates and divisions determine supporting
performance objectives that represent near term results contributing to the achievement of
those critical outcomes and other objectives deemed necessary to measure overall
performance of the Laboratory missions. Indicators are developed for the performance
objectives as a means of determining the degree of success in achieving those objectives.
After agreement has been reached, the critical outcomes, performance objectives and
indicators are documented in the Laboratory Performance Evaluation Plan (PEP) which
disseminates that information to ORNL's staff. Other line organization and management
system performance objectives are documented in self-assessment plans. Flowdown of
the POI's to each staff member through Results Plan Objectives in the Performance
Assessment and Development System (PADS) enables them to understand their role in
achieving the Laboratory Critical Outcomes.
2. Monitoring Performance Against POIs (Assessment)
The second process of PBMS is measuring the degree of success that organizations are
achieving in performing activities directed toward achieving the Laboratory's
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performance objectives. This measurement is accomplished using an integrated
assessment process which includes line organization self-assessments, management
system self assessments, science and technology reviews, internal assessments conducted
by the Office of Independent Oversight, and internal audits conducted by the Office of
Audit and Management Advisory Services. Together these elements generate information
on scientific, business, and operational performance for Laboratory management, staff,
customers, stakeholders, and regulators. The key to accomplishing the measurement is an
integrated assessment program with primary emphasis on self-assessment at the division
and directorate levels. Self-assessment plans are developed at the beginning of each fiscal
year by each organization and management system using a “balanced scorecard”
approach as defined in guidance provided by the ORNL self-assessment procedure to
ensure that important aspects of performance are monitored. The Self-Assessment
program ensures assessment in a wide variety of business activities such as customer
focus, financial, business processes, and organizational effectiveness, as well as
operational discipline. These organizational plans are collated as part of the Laboratorylevel Self-Assessment Plan which also includes copies of the annual internal audit and
independent oversight assessment schedules. Planned assessment activities are reviewed
with appropriate internal and external customers and stakeholders. The ESH&Q Director
ensures that the Laboratory-level Self-Assessment Plan is made available for DOE-ORO
review. DOE and external regulators and customers also perform assessments.
Information generated by these various types of assessments is used by ORNL's
organizations to measure their progress toward achieving performance objectives related
to their activities.
3. Evaluating Performance (Evaluation)
The third process of PBMS is evaluation of the information obtained from the
assessments performed as a part of the overall integrated assessment program (e.g., self
assessments, independent oversight assessments, internal audits, technical review of
science and technology activities, etc.), which provide input to the development of an
overall summary of the Laboratory's performance. During the evaluation process, data
from assessment activities at all levels of Laboratory activity are reviewed including
those programs set in place to discover existing problems. These programs include, but
are not limited to, occurrence reporting, Price-Anderson Amendments Act (P-AAA)
Noncompliance Reporting, Nonconformance Reporting, Radiological Event Reporting,
Accident/Incident Reporting, OSHA Inspections, and Environmental Noncompliance
Reporting. They offer Laboratory personnel and management opportunities to find and to
fix operational problems at lower levels, to look for common areas of concern across the
Laboratory, and to provide feedback to both internal and external customers and
stakeholders. All of this information is compiled in a management level presentation
(qualitative and quantitative) on a periodic basis with an annual evaluation provided to
DOE. Each presentation describes how objectives are met as evidenced by the
performance indicator's progress toward selected targets. Special emphasis is placed on
the identified Critical Outcomes. Level 1 managers are responsible for ensuring that
performance against Critical Outcome objectives is measured and reported.
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Annually, the evaluation process generates a Laboratory-level summary document (the
Laboratory Self-Evaluation Report) that is utilized by management and DOE-ORO to
determine overall performance. This document also describes the Laboratory's key
improvement opportunities as summarized from the self-assessments, technical review of
science and technology activities, independent oversight, internal audit and external
assessment results.
4. Implementing Improvements (Feedback)
The final process in the PBMS is to identify and implement key improvement
opportunities that the evaluation processes identified and to share key lessons learned
with others, both within the Laboratory and across the DOE complex. Quality
improvement processes are utilized to determine the root cause of problems and
corrective actions are implemented to mitigate or to prevent recurrence. Data analysis and
trending programs exist to identify lower level precursor data that may indicate more
serious emerging issues. Laboratory-level improvement areas are disseminated to all
levels of Laboratory staff through lessons learned and other feedback mechanisms for
mid-course corrections and to be considered for inclusion into the overall Laboratory
Agenda during the next planning cycle. PBMS is also recognized as an important aspect
of the Integrated Safety Management process as a feedback and improvement tool.
Where we are
ORNL is still in the first year of the implementation of our formal performance-based
management program. Feedback from our senior management and our DOE customer
has been positive. A few lessons have been learned to date:
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Senior Management (from the very top) support and commitment is crucial. Our
Laboratory Director and his senior staff have supported the performance-based
management process from the beginning.
Communicate, Communicate, Communicate! As with any new concept or program,
management and staff need to understand the purpose and the value of performancebased management.
Educate, Educate, Educate! Ensure that management and staff at all levels
understand the processes and responsibilities for implementing the performancebased management program. At ORNL, we began with senior management-level
briefings, worked our way down to division-level management briefings, and now
conduct a two-hour awareness training class for Laboratory staff.
Document the process as soon as possible. Because of the timetable established for
implementation of our new program, the procedural documentation supporting the
PBMS was not available to Laboratory staff before the process was initiated. This
resulted in inconsistent planning – especially regarding divisional self-assessment
planning.
Accept small victories and movement toward the ultimate goals. Some of the ORNL
organizations have been slow to embrace the PBMS but all are engaged and
beginning to see the value of effective performance-based management.
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