Research by: Gerald L. Barkdoll, DPA


The State of Iowa has been designing, installing, using and refining a state wide performance management system for the past four years. This system was established through the convergence of a number of forces including response to public criticism of accounting practices in the early 1990s, broad based interest in performance based management, initiatives by state career employees, the leadership of Governor Terry E. Branstad, and the active support of the legislature. These forces, combined with successes reported successes some other states led to a legislatively mandated, performance-based, management process that is central to the management of state agencies and aggressively involves a wide variety of stakeholders. (Legislation passed in 1993)

The Process Design

Career employees challenged the process each year, and alter it to meet changing needs and refine it to improve its usefulness. It is still considered a "work in progress" because of the amount of process and content change. The process has now evolved through four annual cycles with the final two cycles encompassing virtually every organizational unit of the state government. The process reaches from strategic planning activities through annual planning involving teams of department representatives to the development of the budget.

The mix of performance measures has changed as goals have been achieved or priorities have been adjusted to meet stakeholder expectations. The largest remaining challenge is full integration with the results orientation with the existing line item budget system which does not lend itself to measuring results of investments. Until full integration occurs, there will in effect be two budgeting processes running in parallel.

Central to the success of the Iowa performance management system is the Council on Human Investment (CHI). The CHI was established by law and was initially chaired by the Lieutenant Governor. It includes four legislative representatives as well as private citizens who have been nominated by the governor and confirmed by the senate. Senior managers from the executive branch also participate in council meetings. The CHI functions as the central focal point for performance management. On an annual basis it receives and analyzes the results of a statistically valid statewide telephone survey of individual citizens. Focus groups, citizen commissions, and town hall meetings augment the design of the survey and the results received from the surveys. This data, performance during the past year, emerging issues, and other relevant factors are considered by the CHI as they develop and ratify long term measurable goals related to overarching issues such as healthy families, economic development, and workforce development. These goals in turn become the umbrella concepts for the State's operating units as they develop their annual plans and address resource needs. The CHI meets monthly QUARTERLY TO review progress made toward the established goals.

Performance Measurement and Management

A wide variety of measures and sources are being used by the CHI as well as the organizational units. Strategic direction, employee feedback, benchmarks, and goals are typically addressed annually unless circumstances require an intermediate reconsideration. Customer satisfaction is ALSO addressed REGULARLY. Financial, productivity, and performance measures are addressed on a monthly basis. Some indicators such as internal processes are addressed on an ad hoc basis.

Performance measures are critical to the management of the State’s activities and they encompass a variety of employee, customer, and other perspectives. The annual planning process and the monthly review of performance however tend to group individual measures by programmatic perspectives. These programmatic perspectives include six topics such as Education, Accountable Government, and Public Safety and Crime. It is important to note that these programmatic perspectives cut across organizational boundaries and require state agencies to work cooperatively in both the development and the achievement of goals. The goals are in turn operationalized by the development of performance measures in each agency. Each of the 20 State agencies have developed and use from 5 to 10 measures of performance.

Central to the success of the performance management system are the State's employees. Previous management initiatives including TQM and reengineering provided an opportunity for state employees to develop the knowledge, skills and experience now needed to FURTHER IMPROVE performance and accomplish established goals. The educational and developmental needs of employees and organizations are assessed annually on the basis of the goals and initiatives established during the planning process. The achievement of goals is now widely recognized and applauded and the development of an incentive system for employees is now under consideration.

Lessons Learned

The experience of designing, installing and subsequently refining the Iowa performance management system has produced a number of insights and learnings.

  1. To be effective the performance management system must be part of the day to day activities of managers throughout the organization. It can not be the property of a particular staff, strata or programmatic subset in the organization.

  2. A performance based management system consists of a set of activities spread over time and encompassing a variety of organizations and individuals. All of these activities must be aligned so they are mutually supportive.

  3. The quantity, diversity, and consistency of the communication needed to design, install and operate a successful performance management system is almost impossible to imagine at the start of the process. Initial estimates of the effort and energy going into communication will prove to be only a fraction of what is actually required.

  4. The budgeting process is likely to prove the most difficult process to integrate with a performance management system. This is true at least in part because of the roles and responsibilities that have been established, practiced, and proven over a long period of time.

  5. A change strategy is critical to the successful creation and implementation of efforts to manage for results.

IOWA Contact:
Mary Noss Reavely
Department of Management
Council for Human Investment
Jim Chrisinger

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