When it comes to performance monitoring, early planning is essential to set yourself up for success. In this blog, we discuss the benefits of performance monitoring, and some key early steps entities should undertake to support meaningful ongoing monitoring.
Shifting your mindset to see the benefits of performance monitoring
Our first blog in this series, The challenge of performance monitoring and reporting, highlighted that since 2015–16, the most common recommendation we made was for entities to improve their performance monitoring and reporting practices. It’s an area entities struggle to get right and is often an afterthought. But why?
Entities need to shift their mindset from performance monitoring being a compliance exercise. They need to lose the fear that it may highlight areas that are not working and instead focus on the benefits. Whether you are an organisational leader, or someone delivering a project, performance monitoring will provide valuable insights and intelligence to ensure you achieve your overall goals.
Some of the key benefits include:
- identifying any areas not working as intended early on – this gives you the opportunity to change your approach to ensure success, rather than finding mistakes when it’s too late
- enabling more effective and informed decision making at all levels – this provides you with timely, accurate, and relevant information to help with decisions
- giving confidence and visibility to management, governance groups, and boards around how key areas are performing
- confirming work being undertaken is on the right track – sometimes it’s important to have confidence that things are working as intended!
To gain these benefits, it is important to have the right organisational culture and tone at the top. Staff throughout an organisation need the freedom to be transparent and shine the light on performance without fear of repercussions. Leaders need to embrace the value of data and information in driving continuous improvement. This leads to a greater chance of success.
How to get started: planning for success
What should entities monitor and measure?
When you break it down, all organisations – both government and non-government – exist for a purpose. So how do organisations know whether they are achieving that purpose? Performance monitoring helps gather evidence to answer that question.
But what needs to be monitored and measured? This is a matter for each organisation to determine. It should logically be informed by organisational strategy – ask, what are the priorities, and what needs to be done to achieve desired objectives? This may include key programs, projects, plans, and strategies. All of which are put in place to achieve overall objectives, otherwise, why would they be done? Accordingly, you should undertake monitoring to determine whether these areas are meeting their intended objectives and desired outcomes.
For simplicity, we have focused this blog on how you may approach monitoring performance and outcomes at the strategy or program level. However, there should be a clear alignment in how this is done across all areas to enable whole-of-organisation performance monitoring overall. An organisation should have a clear line of vision to ensure performance monitoring can be rolled up to the highest level.
Output versus outcome – what’s the difference?
Before we get into determining what to measure and monitor, it is important to understand and differentiate outputs versus outcomes. Outputs refer to the results or delivery of a specific activity or initiative, whereas outcomes refer to the impact and value that outputs create. Outputs support the achievement of outcomes.
Understanding this distinction is important in designing what you will monitor (performance indicators) and how. We regularly see performance monitoring that predominantly focuses on outputs. The issue with this is outputs rarely tell the story about whether the right outcome was achieved. That is not to say that outputs don’t matter – they do. But you need the right balance of performance indicators to measure actual performance.
For example, an entity may measure the success of an education program by the number of people it delivered a course to. This is important, as it measures outreach; however, it gives no insights as to whether attendees left the course with the desired learning and understanding. Our audit Managing invasive species (Report 1: 2023–24) highlights the difference between measuring outputs and outcomes. We found that one department reported on the number of biosecurity incidents responded to, rather than the outcome of the response (that is, did the response actually address the incident?). While another department measured how many pest programs it delivered, but it didn’t know what benefits or improvements it was achieving from them.
This is why it’s important that entities effectively plan the right suite of measures. As a starting point, focus should begin with outcomes. Why have we designed this program or strategy? What are we hoping to achieve by putting it in place? This sets you up with the right mindset to assess overall performance.
What performance indicators should entities measure?
When we think about outputs and outcomes in terms of performance indicators, common terminology is quantitative and qualitative measures.
- Outputs are often quantitative and are typically easier to measure as they are numerical. Examples may include the total number of services delivered, or the average cost or time taken to deliver a service against a target.
- Outcomes are typically more qualitative in nature, with measurement far more subjective and, at times, challenging. But that doesn’t mean you shouldn’t do it. They may be measured, for example, through surveys and interviews, case studies, or research.
When determining what indicators paint the right picture of performance, be sure to consider a balance of indicators that tell the story overall. The Queensland Government’s Performance Management Framework - Better Practice Guide provides useful examples and information to assist entities in coming up with specific measures.
Tip: If you are struggling to determine what to measure and how, this may indicate that your objectives or desired outcomes need greater clarity. We often see strategies with vague or undefined objectives, which makes it very difficult to develop the right performance measures. This supports the value in thinking about measurement upfront – it not only enables ongoing monitoring, but can help ensure clear goals are set.
But what should entities measure indicators against?
Indicators alone won’t tell the whole story – entities need to set targets to assess against. Failure to do this at the start will result in an inability to effectively measure performance in the future! Targets should be specific, measurable, achievable, time bound, and reportable.
You should also be focusing on the actual data and evidence you will need to capture. This is critical to monitoring and assessing your performance. Even the best indicators will mean nothing if you can’t accurately collect the data to measure those indicators. Map it out early, identify barriers, and assign responsibilities for collecting data and information if needed.
Investing in this work upfront may seem like a lot, but it really does form an important part of overall success. Keep an eye out for further articles in our blog series on performance management, where we explore the key areas of performance reporting.
- QAO Fact sheet: Measuring service performance
- Managing invasive species (Report 1: 2023–24)
- Health outcomes for First nations people (Report 14: 2022–23)
- Managing workforce agility in the Queensland public sector (Report 6: 2022–23)
- Improving grants management (Report 2: 2022–23)
- Improving access to specialist outpatient services (Report 8: 2021–22)
- Monitoring and reporting performance (Report 18: 2013–14)
- Follow-up: Monitoring and reporting performance (Report 3: 2015–16)
- Queensland Government: Performance Management Framework - Better Practice Guide.