Performance in Complex, Hierarchical Government Organizations: What Can We Learn from a Comparative Study of Defense Organizations?

Abstract

Performance management, a management model with a long history (Van Dooren, 2008), has been used internationally to promote better government (OECD, 1996) and has been shown to be difficult to adopt (Laegreid et al., 2006) and more difficult to implement. Adoption of performance-based management systems (PBMSs) has been more successful than implementation (De Lancer Julnes and Holzer, 2001). Over the last thirty years, government practice has at its foundation New Public Management (NPM), which promotes managing for results in public sectors worldwide (OECD, 2005). The U.S. and Italian governments embraced this NPM tenet and introduced PBMSs in parts of or entire organizations. We assess the adoption and use of performance management practices in these hierarchical and complex public organizations, in particular how and to what extent the Italian Army (IA) and the U.S. Navy Surface Warfare Enterprise (SWE) implemented PBMSs. By analyzing the cases, we find that both organizations have encountered some benefits and difficulties in implementation. We address these critical factors and contribute to the literature and to practical use of performance management in government organizations by demonstrating some key factors of hierarchical, complex government organizations that enable or hamper successful implementation and use of a PBMS.