Issues in developing a performance criteria system for an organization

Abstract

It is important for every organization to identify and develop a performance criteria system which is the basis for effective management planning and control. An integral part of every evaluation system deals with decisions concerned with the choice of criteria to be evaluated, establishing standards for those criteria, and the desired measurement frequency. The paper discusses the issues mentioned above with an emphasis on operational performance criteria such as time per unit and percent of defects. Research results concerning the evaluation of three different techniques for assigning relative importance of performance criteria are presented. Results show superiority of one technique over the other two. Methodological issues and implementation examples taken from service organizations are presented and discussed.

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