Performance Measurement in the Public Sector

Performance measures are being actively developed in Canada at both the federal and provincial government levels to improve the performance of the public sector and to achieve greater accountability.1 One important source of friction in discussions of performance measurement in the public sector is that closely related terms are used in different ways. Reviewing the types of measures and issues related to their production and use can help avoid misunderstandings. Another reason for calling attention to the spectrum of different types of performance measures is that choices made about how information is to be collected and stored for one particular set of measures can inadvertently facilitate or impede the later development of other measures. When information is to be produced at public expense, it is important for careful consideration to be given to cost-effective auxiliary uses that might be made of the information. We begin by providing a nontechnical overview of the different types of performance measures and some of their uses.2 Next we discuss how these relate to, and can build on, a number of long established private and public sector functions. Formal performance measurement practices have evolved and been used more in a private than in a public sector context.3 Many of these practices require adaptive adjustment if they are to be successfully used in public sector applications. We call attention to some of these needed adaptations. Finally, the article summarizes our main conclusions. A Full Spectrum of Performance Measures Phase of Production One way of classifying performance measures is by the phase of production that they pertain to (i.e. input, throughput, output, and outcomes performance measures). Inputs are all the elements brought in from outside a production situation and used in a particular production process or in the multi-purpose ongoing activities of a productive unit. For example, for a welfare program, those applying for welfare are an input. The hours worked of the welfare workers who process welfare applications are an input. Purchased education and job-finding services made available by the welfare program to selected participants are a program input. Hence, possible input performance measures include the number of those applying for welfare, the number of hours of labour expended by program personnel on taking and processing applications for welfare assistance, and the number of spaces in education and job finding programs that are arranged for and made available by the welfare program to those eligible to receive this help. Throughputs are flow through a production process or program or organizational unit per unit of time and possibly also per unit of some input factor or standardized by some aspect of the external circumstances. From a phase of production perspective, throughputs can be thought of as intermediate products. The welfare applications that are processed each month or year are a welfare program throughput. Likewise, the cases reviewed in a month or a year of