Performance Management in the Public Sector: The State of Art


This chapter reviews the rich literature on performance management in the public sector in order to identify the problems related to such mechanisms and present the research questions explored in this book. We describe what performance management is and how it came to be part of the New Public Management (NPM) movement. The need for performance-based policy and management emerged because the raison d’etre of the traditional public sector ceased to exist. While historically most people believed that the motivation of all players in the public domain was to serve the public interest, over time it became evident that the various players had different motivations and interests as well as different sources of power and information (Horn 1995; Johnsen 2005; Wood 2010). This insight has gradually evolved into the understanding that public organizations and administrators should have clear goals and performance targets translated into performance indicators and accompanied by a set of incentive schemes to motivate them to meet the goals and targets (Heinrich and Marschke 2010; Moynihan 2008; Pollitt and Bouckaert 2010). These are the core characteristics of performance management systems that we will discuss further in the chapter.

Throughout the chapter we show that most researchers adopt an approach of inductive reasoning that concentrates on specific case studies where generalizations may be limited. More general analyses compare different cases, usually using qualitative research methods, in order to © The Author(s) 2017

S. Mizrahi, Public Policy and Performance Management in Democratic Systems, DOI 10.1007/978-3-319-52350-7_2

generalize their findings more broadly (Pollitt and Bouckaert 2010). However, only rarely do studies use deductive reasoning that attempts to derive general insights based on formal theoretical modeling. Our goal is to remedy this gap in the literature. Moreover, in this chapter we describe the micro-level approach that dominates the field. In subsequent chapters, we will demonstrate how a macro-level approach that analyzes the complex setting in which performance management systems operate deepens our understanding of the problems and possible solutions (Arnaboldi et al. 2015).

Hence, the literature review will (1) describe the current research in the field, (2) identify the methodological gaps that limit generalizations, (3) help frame the main research questions in the field, and (4) provide a rich empirical setting that exemplifies the theoretical insights developed in this book.

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