How performance measurement influences stakeholders in not-for-profit organizations

Abstract

Purpose: This paper examines the influences of performance measurement (PM) on not-forprofit organizations' stakeholders by studying how PM practices interact with understandings of legitimate performance goals. This study invokes institutional logics theory to explain interactions between PM and stakeholders.Design/methodology/approach: An in-depth case study is conducted in a large not-for-profit organization in the United Kingdom. Managers, employees, and external partners are interviewed and observed, and performance-related documents analyzed.Findings: Both stakeholders and PM practices are found to have dominant institutional logics that portray certain goals as legitimate. PM practices can reinforce, reconcile or inhibit stakeholders' understandings and propensity to act towards goals, depending on the extent to which practices share the dominant logic of the stakeholders they interact with. Research implications/limitations:A theoretical framework is proposed for how PM practices firstly interact with stakeholders at a cognitive level and secondly influence action. This research is based on a single case study, which limits generalizability of findings; however, results may be transferable to other environments where PM is aimed at balancing competing stakeholder objectives and organizational priorities.

Performance Measurement and Management Systems: A Perspective from Complexity Theory

“…According to command and control theory, organizations are established on the basis of hierarchical relationships with a clear flow of authority, to allow their entities to achieve economic performance and goals (Rizzo et al 1970). Furthermore, in another study, Beer and Micheli (2017) gave a contribution on how performance management influences the attention and actions at an individual micro level, which also reveals social controls at an individual level. From a theoretical perspective, if organizations do not control behavioural factors such as empowerment, autonomy, trust, communication and training, role complexity could develop.…”

“…The teleological property specifies goals (Jääskeläinen and Laihonen 2013), objectives (Haponava and Al Jibouri 2009;Mol and Beeres 2005) and managerial practices (Angelis and Jordahl 2015). Stakeholder goals (Beer and Micheli 2017).…”

Advancing Performance Measurement Theory by Focusing on Subjects: Lessons from the Measurement of Social Value

“…Beer and Micheli 2017;Bourne et al 2013;Smith and Bititci 2017). Beer and Micheli 2017;Bourne et al 2013;Smith and Bititci 2017).…”

“…Others have succeeded in reinforcing positive behaviours aligned to each respective goal by allocating measures that are distinctively social or financial (as recognized by language used and on what they focus attention on (i.e. service users or revenues)) to relevant stakeholders responsible for specific activities (Beer and Micheli 2017). However, further research is required to understand how these different forms of measurement may complement and extend each other in the pursuit of sustainable organizational strategies.…”

“…In recent studies, the implications of the social aspects of different PMM practices were found to be significant in relation to how people experience their work and relationships (e.g. Beer and Micheli 2017;Bourne et al 2013;Smith and Bititci 2017). In future research, ethnographies witnessing responses to different PMM methods, phenomenological diaries or journals of frontline employees and/or service users, observations of the utilization of a variety of PMM mechanisms, or focus groups of particular stakeholders could be useful in comparing newer methods of PMM that include (forms of) the practices of 'caring for the self'.…”