What is the Foundation for a Performance Measurement System?

Lessons Learned Handbook:

DOE-HDBK-7502-95

4. Management Assessment: Without measurements there is no way to be

certain we are meeting value-added objectives or that we are being effective

and efficient. The basic concept of performance measurement involves (1)

planning and meeting established operating goals/standards; (2) detecting

departures from planned levels of performance; and (3) restoring performance

to the planned levels or achieving new levels of performance.

What is the Foundation for a Performance Measurement

System?

Successful performance measurement systems adhere to the following principles:

1. Not measuring too much. Measuring only what is important: things that impact

customer satisfaction.

2. Focusing on customer needs: We should ask our customers if they think this is

what we should be measuring.

3. Involving employees (workers) in design and implementation of the

measurement system: Gives them a sense of ownership and improves quality

of the measurement system.

The basic feedback loop shown in Figure 4 presents a systematic series of steps for

maintaining conformance to goals/standards by communicating performance data back

to the responsible worker and/or decision maker to take appropriate action(s).

The message of the feedback loop is that to achieve the goal or standard, those

responsible for managing the critical activity(s) must always be in a position to know

(a) what is to be done; (b) what is being done; (c) when to take corrective action; and

(d) when to change the goal or standard.

The basic elements of the feedback loop and their interrelationships are:

1. The Sensor evaluates actual performance.

2. The Sensor reports this performance to a Responsible Worker.

3. The Responsible Worker also receives information on the goal or standard.

4. The Responsible Worker compares actual performance to the goal. If the

difference warrants action, the worker reports to a Responsible Decision Maker.

5. The Responsible Decision Maker verifies variance, determines if corrective

action is necessary, and, when required, makes the changes needed to bring

performance back into line with the goals.

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