Proof Positive

For the past few years, we've written about performance measurement as though the benefits of this tool have been proven beyond all doubt. So it came as something of a jolt to us, not long ago, when we discovered that there's a cadre of academics who continue to believe that managing for results is a mixture of fad and bad strategy. They argue that it's a private-sector import aimed at creating some kind of bottom line for cities and states. They also maintain that administrators and politicians want to use performance measures to undermine the role of bureaucrats. Perhaps the biggest complaint is that it's very difficult to demonstrate, scientifically, that managing for results really works.

Of course, we understand the dangers in proving a theory by citing a handful of good anecdotes. We've long scoffed at journalists who use one example to prove a phenomenon, two to claim it's a trend and three to call it an epidemic.

Coincidentally, as we were mulling this over, we had a chat with Carolyn Lane, budget officer in Louisiana. Just a few years ago, she expressed dismay at how long it was taking for managing-for-results systems to provide a real payoff. She told us then that Louisiana was moving toward a managing-for-results environment "one funeral at a time."

Listen to her now: "We have had a sea change on the use of performance information. Managing for results is working here."

Louisiana started down its current path in 1989. At that time, the effort was centered in the executive branch, under reform-oriented Governor Buddy Roemer. When Governor Edwin Edwards succeeded Roemer, no one dismantled the apparatus for gathering performance measures. But no one paid any attention to them, either. Following the 1995 election, a change of leadership in the legislature and the governor's office breathed new life into the effort. In 1997, the legislature mandated performance-based budgeting and created specific requirements for strategic planning and performance accountability, setting the groundwork for creating both incentives and disincentives based on agency performance.

Okay, so now there are lots of systems in place throughout the state. But what's the proof that it's not all just a tale of sound and fury, signifying nothing?

We checked in with Elise Read, analyst for Louisiana's House Committee on Appropriations. She told us that performance standards are now included in the appropriations bill and that legislators are paying attention. "It gives them context," she says. "It puts down on paper for the record what the agency wants to accomplish. And everybody can see it. There is no fuzziness about what the expectations are."

That clarity has led to changes. For example, the Governor's Office of Women's Services is a small Louisiana agency that had been steadily adding training programs for women. That sure sounds like a mom-and- apple-pie kind of mission (it may even have trained some moms to bake apple pies). But when there was a focus on the office's results, it turned out that the state was spending more than $85,000 for every woman who got a job. The agency has now been "downsized" and given a more restrained mission as an advocacy group for women.

Another example comes from the Department of Public Safety, where data showed that a surprising number of checks it received were bouncing. A subsequent statewide audit revealed that several other agencies were dealing with bounced-check problems. Once the state could see that several agencies were having a similar difficulty, it quickly made changes in the system to deal with the problem statewide. "And the problem got better," says Read, noting that the solution came from the reading of "an indicator deep in the management and finance portion of the agency."

This doesn't mean that everyone within Louisiana agencies has become a true believer in the efficacy of performance measures. Putting together all the data on a quarterly basis is a pain in the neck. And if an agency doesn't do a good job, it can find itself in serious trouble. When the legislature was displeased with the quality of the data from the Bridge Trust Program in the Department of Transportation and Development, the House appropriations committee separated the bridge and ferry operations from each other. That limited managerial flexibility to move money around between bridges and ferries, and saddled both with more oversight and control.

Like every other government, it's possible--even likely--that Louisiana is using some measures that will lead to bad budgeting or policy. We certainly can't prove that it isn't. But that doesn't mean that performance measurement is a bad thing. It just means that dumb performance measurement is a bad thing. And we'll take our chances that as time goes on, and cities, counties and states have more experience with this tool, there will be more and more smart uses of measures. For now, that certainly seems worth the risk.