preview

Performance Management System Case Study

Better Essays

Performance management systems (PMS) framework acts as a research tool in depicting the structure and operation of PMS of an organization in a more holistic way (Otley, 2009). It was developed based on Otley’s (1999) performance management framework and Simon’s (1995) levers of control framework. Performance management framework proposed by Otley emphasizes five central issues which he contends are necessary to be taken into consideration as part of the process in developing the PMS structure. The five central issues relate to the key organizational objectives, strategies and plans for the accomplishment of the organizational objectives, target-setting, rewards systems and finally the information feedback loops (Otley, 1999). Simon’s levers of control framework act as an instrument for the execution and control of business strategies. It comprises four key concepts including core values, risks to be avoided, critical performance variables and strategies uncertainties which are controlled by certain systems. As shown in the figure below, these four key concepts are controlled by beliefs system, boundary system, diagnostic control system and interactive control system respectively (Simon, 1995). Refer to figure 1.1 below. PMS framework elaborates Otley’s five issues of the performance management …show more content…

What mechanisms, processes and networks are used to convey the organization’s overarching purposes and objectives to it members? Vision and mission are important in which they determine the direction and pathway the organization wants to take to ensure the viability and success of the organization. Vision and mission convey the crucial messages throughout the organization so that everyone can carry out the tasks in order to accomplish organizational goals. They are part of the beliefs system in Simon’s levers of control

Get Access