How legislators view productivity

Legislators and chief executives might adopt the same point of view. Those dimensions they can control through their power to enact and implement laws might receive the highest priority for performance measurement. Because chief executives and legislators have more control over some decisions than do program managers, they would probably include performance dimensions different from the managers'. Allocating resources among programs is one policy decision that might make cost-effectiveness information more important to legislators and chief executives than to managers.

The competitive edge of modern-day business emerges from creation or discovery of a performance management. A system that increases efficiency, decreases cost or enhances quality confers immediate competitive advantage on its creator and sets a standard for the rest of the industry to follow. But once disseminated across the field of competition, it becomes the standard. Now a new, yet more innovative, high performance system must be discovered that once more creates competitive advantage for its inventors.

As public-sector productivity gets increasing national attention, state and local governments seek more ways of improving their performance. Performance measurement systems may be helpful tools for improving both productivity and accountability. This paper identifies issues that governments should consider before implementing a performance measurement system.