Performance
Measurement and
Organizational
Effectiveness
Presented by Larry W. Maholland
ICMA Center for Performance Measurement
2005 Forum
April 26. 2005
Formal
Organizational
Structure
Citizens
Mayor and City Council
City Administrator
Departments
Police
Fire
Public Works
Community Development
Economic Development
Finance
Human Resources
Information Systems
Welcome to St. Charles!
 Population
32,000
 35 miles west of Chicago
 Settled in 1834
 365 full-time equivalent employees
 Budget = $150 million
Our Strategic
Framework
Strategic Framework
Information
Sources
(Current
Reality)
Core Values
~ Core Values ~ Core
Citywide
Values ~ Core Values ~ Core
Goals
Values ~ Core Values ~ Core Values
~ Core Values ~ Core Values ~ Core
Values ~ Core Values ~ Core Values ~
Resources
Objectives
Core Values ~ Core Values ~ Core
Values ~
Core Values ~ Core Values ~ Core Values ~
Core Values ~ Core Values ~ Core Values ~
Core Values ~ Core Values ~ Core Values ~
Core Values ~ Core Values ~ Core Values ~
Core Strategies
Values ~ Core Values ~ Core Values
~ Core
Values ~ CorePerformance
Values ~ Core
and
Values
~ Core ValuesTargets
~ Core
Action
Plans
Values ~ Core Values ~
Core Values
Mission
Vision
Information Sources (Current Reality)
 Customer
Information
Sources
(Current
Reality)
See Handout
Surveys
 Comparisons and Trends
 Performance Measures
 Focus Groups
 Business Calls & City Hall
Housecalls
 Listen & Learn
 Tuesdays Over Easy
Vision
 An
ideal picture of the future
 Integrates the past with the
future
 Created by the community
Vision
See Handout
Structured Meandering
Core Values
~ Core Values ~ Core
Citywide
Values ~ Core Values ~ Core
Goals
Values ~ Core Values ~ Core Values
~ Core Values ~ Core Values ~ Core
Values ~ Core Values ~ Core Values ~
Resources
Objectives
Core Values ~ Core Values ~ Core
Values ~
Core Values ~ Core Values ~ Core Values ~
Core Values ~ Core Values ~ Core Values ~
Core Values ~ Core Values ~ Core Values ~
Core Values ~ Core Values ~ Core Values ~
Core Strategies
Values ~ Core Values ~ Core Values
~ Core
Values ~ CorePerformance
Values ~ Core
and
Values
~ Core ValuesTargets
~ Core
Action
Plans
Values ~ Core Values ~
Core Values
Mission
See Handout
Formalizing the
Philosophy
Guiding Principles to Formalize the
Philosophy
 Devote
the necessary time
 Involve employees from all levels
 Significant changes and programs
 Use outcome and efficiency performance
targets
Steps to Formalize the Philosophy
 Step
1: Why Are We Doing This?
 Step 2: Environmental Scan
 Step 3: Information Review
 Step 4: Vision, Mission and Values
 Step 5 & 6 – Intradepartmental Analysis &
Interdepartmental Communication
See Handout
Steps to Formalize the Philosophy
(cont.)
 Step
7 -- Council Retreat
 Step 8 – Review Key Initiatives (citywide goals)
 Step 9 – Develop Objectives, Strategies,
Performance Targets and Action Plan
 Step 10 – Present Plan
 Step 11 – Process Evaluation
See Handout
Converting Theory
Into Practice
Introducing the Concept
 Why
is it called a Business Plan?
 Why citywide goals?
 Is an objective qualitative and a goal
quantitative, or is it the other way around?
Deployment
 Learning
together
 How many to involve
 How far to go
 Persistence
Institutionalization
 The
look of the document
 Business Plan presentations
 Broad Distribution
 Discuss with new hires
 Included in budget
Personalizing Posters
 Listen
and Learn
 Staff meetings
 Council Update
 Business Plan process review
St. Charles’ View of
Performance
Measurement
“A team without a scoreboard is not
playing the game; it is only practicing.”
Tom Malone, President, Miliken & Co.
City of St. Charles Vision Statement
“We will preserve our unique character as a
dynamic, prosperous city, maintaining the small
town charm, the natural beauty of the Fox
Valley, and the quality schools, parks and
services that make St. Charles distinct. Our
historic downtown is the heart of the
community, and keeping it healthy and vibrant is
essential. Building on our heritage, we will
balance nature and development…”
“How Do We
Know?”
Reasons to Use Performance Measures
•What gets measured, gets done
•You can’t tell success from failure
•If you can’t see success, you can’t learn from it
•If you can’t see success, you can’t reward it
•If you can’t see failure, you can’t correct it
•If you can demonstrate results, you can win
public support
Source: NWMC --“Performance Measurement Consortium:
Technical Committee Report” Sept. 1998
Reasons to Use Performance
Measures (con’t)
•Planning/budgeting
•Operational improvement
•Program evaluation
•Reallocation of resources
•Accountability
•Directing operations
•Contract monitoring
Source: ICMA -- “Accountability for Performance Measurement and Monitoring
Local Government” Edited by David N. Ammons, 1995
Balancing the Critical Factors for Success
Developed by: Robert S. Kaplan & David P. Norton
Factors That Influence Success
Factors for Success
Perspective
Strong financial position
Financial
+
+
+
Satisfied and loyal
customers
Customer
Responsive and predictable
internal processes
Operations
Motivated and skilled
employees
Learning and Growth
=
High quality products and
services
Result of attention to
perspectives
Perspectives Important to Success
Financial
Short-term
Customer
“There is a saying in the United
States that customer is king. But
in
customer …
is God.”
ItJapan
is thetheworkers
who hold
~Tak Kimoto, Sumitronics Inc.
Employee
Operations
a
company’s information and
knowledge about its research,
Long-term
its products, its customers, and
its corporate experience of
what works and what
“If there is a way to do it better …
doesn’t.” ~Leon Martel
find it.”
~Thomas A. Edison
Drivers Provide Indication of Future Success
Driven by short-term measures that lead to
successful outcomes
 Drivers link cause to the effect
 Drivers are leading indicators
 Outcomes are lagging indicators
Customers Drive the Other Perspectives
Quantitative
Customer Data
Priorities Survey
Bus. Retention
Survey
Employee Survey
Follow-up Surveys
Available output,
outcome and
efficiency
measures
Operations
Learning &
Growth
Financial
Business Plan
Qualitative
Customer
Information
Focus Groups
“Business Calls”
“City Hall
Housecalls”
“Tuesdays Over
Easy”
“Listen and Learn”
Budget Plan
St. Charles’ Strategy
In Action
St. Charles’ Strategy in Action
 Customer
– Site visits and surveys
 Learning and Growth – Service Essentials TM
Letter to Mayor:
 Internal Business Processes – Service
“An
unhappy
customer
will
“When
we first
considered
standards
share
their
moving
to experience
St. Charles , with
we
 Financial -- $140,000 per year
expressed
20concern
others.”over the
 Intangible
city’s reputation
of being
~Bob
Moran, President,
 Successful
business
difficult
toConsulting
work with on
Moran
construction
projects…”
 Human
capital
St. Charles’ Strategy in Action
“…I can say with all honesty that the
interaction we experienced with every
city department was professional,
courteous and respectful of our needs
and time constraints…the many staff
members we worked with left me with
the impression that St. Charles was a
community that would welcome our
business and work with us to achieve our
goals.”
Programs That Support City’s
Philosophy
Process Improvement Teams
 Wellness
 Accounts Payable
 Health Insurance
 Retiree Insurance
 Supervisory & Leadership Training (SMILE)
 Performance Unbundling
 Emergency Preparedness
 Hiring Process
 Mobile Communications
 Permit Tracking
Programs That Support City’s
Philosophy (cont.)
 Service
Essentials training
 Grapevine
 Pre-application & Pre-submittal meetings
 Council Update
 Records management
 Emotional Intelligence coaching
 Council agenda summaries
 Staff meetings
The “Bottom Line”
Is Results
“How would you describe St. Charles
as a place to live?”
2000
2001
2002
2003
2004
Excellent/Good
93.2%
95.3%
94.6%
94.4%
93.5%
Fair
2.6%
3.9%
3.5%
3.5%
3.5%
Poor/Very Poor
0.0%
0.0%
0.7%
0.2%
0.6%
“Overall, how would you rate St.
Charles as a place to do business?”
1998
2000
2002
2004*
Excellent/Good
80.4%
87.5%
92.7%
88.4%
Fair
14.3%
8.0%
4.9%
10.5%
Poor/Very Poor
5.4%
1.8%
0.0%
1.1%
*Low response rate
“How would you rate the
responsiveness of St. Charles’ city
employees?”
2000
2002
2004*
Very Responsive &
Responsive
42.6%
68.0%
61.1%
Average
23.2%
14.6%
10.5%
Unresponsive & Very
Unresponsive
3.6%
0%
3.2%
*Low response rate
Employee Training
75
27,500
70
25,000
65
22,500
60
20,000
55
17,500
50
15,000
FY 2000 FY 2001 FY 2002 FY 2003 FY 2004
Per Empl. Training Hrs.
Total Empl. Training Hrs
“I understand the City’s mission and
goals.”
5.25
5.20
5.15
5.20
1 = Strongly disagree
7 = Strongly agree
5.10
5.10
5.06
5.05
5.00
4.95
4.91
4.90
4.85
4.80
4.75
1998
2000
2002
Weighted Avg.
2004
“I am proud to work for the City.”
7.50
7.00
6.50
6.00
1 = Strongly disagree
2 = Strongly agree
6.00
5.74
5.74
5.88
2000
2002
2004
5.50
5.00
4.50
4.00
3.50
3.00
1998
Weighted Avg.
Providing budgetary/financial information
in an easy-to-read and understandable
format
Satisfaction
3.50
3.00
3.00
2.49
2.50
2.34
2.43
2002
2004
2.00
1.50
1.00
0.50
0.00
1998
2000
Weighted Avg.
Conclusions
 Create
a vision
 Assess current reality
 Commit to experimentation and learning
 Measure performance
Questions?
Group Activity
Each table will create a vision, mission,
objectives, core values and performance
targets for my retirement party.
Group Activity -- Example
Plan your next vacation
Vision
Sunshine and 80 degrees near the water with great
restaurants and a casual atmosphere.
Mission
Relax and get recharged
Objectives
Enjoy the recreational opportunities (e.g. sailing &
fishing)
Return relaxed and reenergized
Core values
Have fun
Appreciate the diversity in food and people
Live healthy
•
•
•
•
•
•
•
Group Activity -- Example
Performance targets
Blood pressure will drop by 10% upon
return
Read at least 3 “pleasure” books
Gain no more than 5 pounds
Survey of work group before and after you
return, “On a scale of 1-Lousy to 5extremely happy, rate your mood.” The
score should be Improved from a 2.5 to 3.5.
•
•
•
•
Larry W. Maholland
City of St. Charles
2 East Main Street
St. Charles, IL 60174
lmaholland@stcharlesil.gov
630-377-4425