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A New Approach to Performance Measurement and Goal Setting

Author

Listed:
  • Bruce H. Andrews

    (School of Business, University of Southern Maine, 96 Falmouth Street, Portland, Maine 04104-9300)

  • John J. Carpentier

    (Hannaford Brothers Company, 145 Pleasant Hill Road, Scarborough, Maine 04074)

  • Tracy L. Gowen

    (University of Maine School of Law, 96 Falmouth Street, Portland, Maine 04104-9300)

Abstract

To support their continuous improvement programs, we developed and implemented a performance-measurement and goal-setting system for the six regional water utility operating companies that are all managed by one holding company. The performance-measurement and goal-setting stages both have two sample-based methodological components: (1) estimation of past and future cumulative distribution functions (c.d.f.s) of the key performance metric for a population of operating companies in the industry, and (2) regression analysis of the same metric for comparing period-to-period changes (both past and projected) in the performance of individual operating companies. This system has allowed the holding company to better evaluate and plan for its own performance in relation to that of its peers and to establish credible, individualized goals for its six regional companies based on estimates of their inherent capability.

Suggested Citation

  • Bruce H. Andrews & John J. Carpentier & Tracy L. Gowen, 2001. "A New Approach to Performance Measurement and Goal Setting," Interfaces, INFORMS, vol. 31(3), pages 44-54, June.
    • Handle: RePEc:inm:orinte:v:31:y:2001:i:3:p:44-54
    DOI: 10.1287/inte.31.3.44.9629
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    References listed on IDEAS

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    1. Charnes, A. & Cooper, W. W. & Rhodes, E., 1978. "Measuring the efficiency of decision making units," European Journal of Operational Research, Elsevier, vol. 2(6), pages 429-444, November.
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    Cited by:

    1. Anja Heinicke, 2018. "Performance measurement systems in small and medium-sized enterprises and family firms: a systematic literature review," Journal of Management Control: Zeitschrift für Planung und Unternehmenssteuerung, Springer, vol. 28(4), pages 457-502, February.
    2. Grafton, Jennifer & Lillis, Anne M. & Widener, Sally K., 2010. "The role of performance measurement and evaluation in building organizational capabilities and performance," Accounting, Organizations and Society, Elsevier, vol. 35(7), pages 689-706, October.

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