ORGANIZATIONAL DRIVERS OF PERFORMANCE INFORMATION USE: THE PERSPECTIVE OF POLISH LOCAL GOVERNMENTS.

• Author: Lewandowski, Mateusz

1. Introduction

   The New Public Management reforms fostered the implementation of performance management systems all around the world, also in Central-Eastern European countries. The main product of such systems is performance information (PI), provided in order to facilitate public managers and policymakers in decision-making, resource allocation, etc. (Van Dooren, Bouckaert and Halligan, 2015). Although for the last 40 years profound knowledge on public sector performance management has been gathered (Pollitt, 2018), its practical application and use often remained an 'Achilles heel' of public administration (Bouckaert and Peters, 2002; Moynihan and Pandey, 2010; Cepiku et al., 2017), also in CEE countries (Nemec, 2010; Fundacja Rozwoju Demokracji Lokalnej, 2013).

   A substantial amount of research has focused on the following main areas of performance information use: the conditions affecting the process of its adoption; the implementation of performance measurement systems (Niven, 2003); the factors influencing the use of performance information (De Lancer-Julnes and Holzer, 2001); the assessment of performance in municipalities; the effects of this use (Beeri, Uster and Vigoda-Gadot, 2018); and its misuse and dysfunctional use (Bouckaert and Balk, 1991). This study focuses on the drivers and antecedents of the use of performance information. Within this vein, various factors have been tested since De Lancer-Julnes and Holzer (2001) published their seminal paper outlining a theory of utilization of performance information, which revealed the impact of rational and cultural factors on performance information use. More recently, Kroll (2015), on the basis of a thorough review of empirical investigations, provided a list of individual, organizational, and environmental factors, classified according to the strength of the impact on the use of PI. Simultaneously, he advocated studying indirect effects of independent factors on PI use in order to reach 'a better (stepwise) understanding of the mechanisms behind direct effects' (Kroll, 2015, p. 477). One way to follow this direction is to verify direct relations between known drivers of the use of performance information.

   In accordance with the indicated research gap, this paper focuses on organizational drivers of performance information use because it is more difficult and risky to implement performance management in post-communist countries (Nemec, Merickova and Ochrana, 2008). By building on the Information Systems theory, this study contributes to the Performance Information Utilization theory by proposing decoupling the major and most influential organizational driver of performance information use, and by testing the relations between these decoupled components, namely the quality and usefulness of performance information, and organizational capabilities consisting of other important organizational drivers of PI use indicated by Kroll (2015). Considering that most empirical studies on the antecedents of the use of performance information have been conducted in the USA and Germany, this paper contributes to the debate not only by providing a more in-depth understanding of the relations between the organizational drivers of PI use, but also by embracing the neglected political context of Central Eastern European countries.

   This article is structured as follows. First, the results of a literature review on the organizational drivers of performance information use are reported in order to complement Kroll's (2015) findings and get the most up-to-date knowledge in this field. Second, two theories of information systems and information quality are used to develop a theoretical framework of the relations between the most important organizational drivers of PI use. Then, the methodology section describes the sample, measures, and procedures. Next, the results are presented and discussed. Finally, some conclusions and implications for practice are drawn.

2. Organizational drivers of performance information use

   The use of performance information was scrutinized from various perspectives. De Lancer-Julnes and Holzer (2001) distinguished as two separate stages the adoption and the implementation of performance information. The adoption phase pertains to the development of outputs, outcomes, and efficiency measures. In turn, the implementation phase denotes the actual use of performance measures in management and in reporting (De Lancer-Julnes and Holzer, 2001, p. 695). Other studies outlined over forty different practical applications (e.g., allocation of resources, organizational development), encapsulated in several main types of use, for example steering and control, learning, and giving account (Behn, 2003; Van Dooren, Bouckaert and Halligan, 2015). Although such an understanding of performance information utilization has been widely recognized (Heinrich, 1999; Moynihan and Pandey, 2010; Kroll and Moynihan, 2015), it is not the only one. For example, Dooren (2005) speaks about supply (production) and demand (use) of performance information, defined as 'having performance measurement tools' and 'doing performance measurement', respectively (Van Dooren, 2005, p. 369). Empirical evidence supports this distinction because performance information is not always incorporated in decision-making, reporting or organizational learning, even though it is collected and provided with a well-designed performance measurement system (Angiola and Bianchi, 2015; Cepiku et al., 2017).

   Public sector performance management literature has identified various organizational factors affecting the use of performance information. In general, the use of performance information is contingent on the design of the performance management system (Heinrich, 1999). This view was extended in the seminal paper of De Lancer-Julnes and Holzer (2001), who identified different technical/rational and political/cultural factors influencing the adoption and implementation (use) of PI. For the adoption phase of PI utilization, organizational capabilities were defined as organizational readiness to deploy and sustain a performance management system (Van Dooren, Bouckaert and Halligan, 2015). In practice, specific sets of organizational requirements needed to implement a particular system were defined, like the Balanced Scorecard (Niven, 2003) or executive control (INTOSAI, 2004; European Commission, 2007; COSO, 2013). However, De Lancer-Julnes and Holzer's (2001) study showed that resources, goal orientation, information, and internal requirements are important factors affecting the implementation of PI if the adoption phase is excluded from the model. When the adoption phase is included, only the resources and information remained statistically significant. The use of performance information requires dedicated staff and organizational structure, data collection, access to 'how-to' information, and monetary incentives (De Lancer-Julnes and Holzer, 2001). On the contrary, Kroll and Vogel (2014)argued that public managers driven by a public service motivation and working under transformational supervisors are more likely to use PI. Van Dooren (2005), in turn, found that the measurability of output, the size of organizations, and the goal affect the way in which performance measurements are defined and gathered. Usually, bigger organizations have more resources with which to implement information systems and put greater demands on such performance information. A lower ability to measure output, as in diplomacy or cultural services, might naturally hinder PI use, while goal orientation should enhance it (Van Dooren, 2005).

   A recent systematic literature review of empirical investigations of the antecedents and drivers of performance information use revealed the most important organizational drivers, such as measurement system maturity, leadership support, support capacity, innovative culture, and goal orientation/clarity (Kroll, 2015). As promising organizational drivers, the same study identified learning forums and routines, attitudes toward performance measures, prosocial motivation, and networking behavior (Kroll, 2015). The latest studies, summarized in Table 1, enrich the picture drawn by Kroll (2015).

   In particular, these papers help to describe better the variety of contexts of PI use, confirm some previously known drivers of PI use, and indicate some new ones. Henderson and Bromberg (2015) found that longer relationships with an agency are related negatively and significantly to performance information use, although the magnitude of the effect was small. If an agency is socially embedded and demonstrates a continual history of service provision, the municipal officials have less need to rely on performance measures when assessing such an agency (Henderson and Bromberg, 2015). Moynihan's (2015) study revealed that positive comments from public employees about performance can alter the budget allocation for a program, and resource allocations are lower due to goal ambiguity and disconfirmation of expectations created by performance targets. Lee and...