Driving innovation though performance evaluation

Abstract

Since the past two decades there has been an increased activity in development of performance management systems aimed at various organisational levels, covering a multitude of dimensions. Since the focus of performance management is on enabling actionable learning aimed at business improvement, these systems should lead to innovation in management processes. In contemporary organizations, the pervasiveness of information and communication technologies underscores the importance of measuring their performance to drive a culture of continuous improvement. It is particularly relevant for asset managing engineering organisations, which are increasingly becoming information technology intensive by utilising a multitude of operational and administrative technologies to execute their business. Performance management of information technologies utilised in asset lifecycle management, therefore, should not only be aimed at reporting on the fit of existing asset management processes with the these technologies, but also on how to enhance the effectiveness of asset lifecycle management strategies enabled by various technologies. Therefore, it is important to assess the impact of performance management systems on business improvement, so as to enable assessment and establish credibility of the performance management system itself. However, literature is relatively silent on this issue. The lack of empirical research on this important issue has been attributed to the relatively immature theoretical nature of the field of performance management. This paper develops a theoretical framework for performance management research to guide empirical examination of the impact of performance management systems on business and management process innovation.