Performance‐driven behavior as the key to improved organizational performance

Abstract

Purpose

Recent research states that both the instrumental and the behavioral dimensions of performance management have equal influence on the performance of an organization. To test this statement, these dimensions have been operationalized in an analysis tool called the performance management analysis (PMA). This paper aims to discuss the results of research into the relation between the instrumental and the behavioral dimensions and organizational performance, using the PMA.

Design/methodology/approach

The PMA questionnaire was developed to test the instrumental and behavioral dimensions of performance management. With the PMA an organization can score itself on both dimensions, to evaluate the degree of its result‐orientation. The more attention an organization pays to elements belonging to a certain dimension, the higher it will score on that dimension. In addition the relative competitive performance of the organization is identified. This is done by asking the respondents to compare their organization's performance to that of its competitors or organizations with similar services. During the period January 2002‐March 2006 data were obtained by distributing PMA questionnaires to work‐experienced students of MBA courses taught by the author, participants of seminars conducted by the author, and workshops held by the author and colleagues at companies. In total 577 questionnaires of organizations in The Netherlands and the UK from a broad range of industries (both profit and non‐profit), were collected.

Findings

The research results show that paying equal attention to the instrumental and behavioral dimensions of performance management systems indeed results in higher competitive performance. Therefore, the research results provide a first indication of the importance of combining instrumental and behavioral dimensions to create a successful performance‐driven organization that achieves sustained better results.

Research limitations/implications

The respondents of the questionnaire may have scored their own company more favorably than an objective outsider would have done. It is also possible that there are other aspects of importance to performance‐driven behavior, which have not been included in the research.

Practical implications

This study identifies which instrumental and behavioral dimensions an organization has to focus on, and the extent of this focus, in order to achieve sustainable performance.

Originality/value

An increasing number of profit and non‐profit organizations are implementing new and alternative performance management systems in order to obtain better organizational results. Despite the increase in experience gained with this approach, there is still a lot to be learned about the factors that influence the everyday use of these systems and of the factors that influence performance‐driven behavior. The research described in this paper provides evidence that paying equal attention to both instrumental and behavioral dimensions is paramount in order to create a successful performance‐driven organization that achieves sustained better results. As these dimensions have until now not been identified as an integral set, this identification is the contribution to the literature.

Citation

de Waal, A.A. (2010), "Performance‐driven behavior as the key to improved organizational performance", Measuring Business Excellence, Vol. 14 No. 1, pp. 79-95. https://doi.org/10.1108/13683041011027472