A Framework for Assessing Incentives in Results‐Based Management

Abstract

Many governmental results-based management systems have not produced the expected positive effects. This article analyzes the reasons for this common disappointment by looking at three components of results-based management-results-specific information, capacities, and incentives-and concludes that incentives are often the least developed. It then synthesizes a simple framework for evaluating the efficacy of results-oriented incentives. To be successful, results-specific incentives must be tailored to fit four program characteristics: timeliness, political environment, clarity of the cause-and-effect chain, and tightness of focus. This framework suggests that some systems put too exclusive an emphasis on budgetary incentives and could be strengthened by emphasizing personnel-system rewards, especially those that look beyond business models.Governments throughout the United States have recently implemented similar major management reforms. The single new approach has been given many names, such as strategic management, performance-based management, results-based management, outcome management, and New Public Management. In this article, we will call all such approaches, somewhat arbitrarily, results-based management. We will also adopt the common convention that results is a synonym for outcomes, and that an outcome is any agency-produced effect on individuals who do not work for that agency.Although they have different names, almost all of the results-based management approaches share some core components. When compared to traditional systems, results-based management systems generally put a greater emphasis on strategic planning; on performance measurement, especially the measurement of program outcomes; on customer satisfaction as one of the desired outcomes; on results-oriented objectives, including both long-range and shorter-range goals; on delivering many of those outcomes through cross-functional teams and empowered front-line employees; and on the use of business-like process-improvement tools 1 (Osborne and Plastrik 1997; U.S. Commerce Department 2004a, 2004b).Besides sharing many core system components, agencies with results-based systems also share the belief that their new systems will make their organizations more outcome oriented, proactive, and agile, leading to greater overall effectiveness.

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