Implementing Performance Measurement Systems in Local Governments: Moving from the “How” to the “Why”

Abstract

This paper examines how Performance Measurement Systems (PMSs) are implemented in local governments where the initial context is defined by equivalent external pressures and professional expertise, in order to address the question of “why” PMS implementation patterns differ from one setting to another. The study explored the reasons behind these different patterns in a context where local governments responsible for providing a local service implemented a PMS with the direct support of professional experts, and thereby it contributes to the extant literature in the field of PMS implementation. In order to achieve this purpose, the investigation analyzed three local governments (municipalities) that were required to implement a PMS because of external legislation requirements rather than by choice and is based upon a participatory case study approach involving interviews, observations and secondary data sources. Research was conducted through the theoretical lens of Old Institutional Economics to identify three PMS implementation patterns, here called formal compliance, shared vision and technical oligarchy. The role played by three factors, power, communication and an inclination to learn, is discussed in the results, as these three factors in particular may help to explain the heterogeneity in the implementation patterns observed.