Performance Indicators

Performance indicators are a convenient way of monitoring the effectiveness and efficiency of an organisation. These can be used to assess the effectiveness of policy, because they measure impacts, outcomes, outputs and inputs relating to decisions. They help to quantify the degree to which objectives have been achieved, and to identify any constraints that are impeding the achievement of objectives. They help to answer questions such as:

• Is the organisation doing the right things?
• Is the organisation doing things, right?
• What things done by others significantly affect the organisation?

Difference between Performance Indicators and Operational Statistics

Operational statistics are used by the organisation to oversee and manage all aspects of its operations. The statistics are mainly for internal use although, in the case of government departments, some may be made available publicly through their inclusion in annual statistical abstracts published by government.

Performance indicators relate to the impacts and perceptions by the customers of the organisation. As such, they are targeted externally. Indicators consist typically of a few selected operational statistics that characterise performance in a way that customers can relate to and understand.

Benefits of Performance Indicators’ Publications

Progressive organisations and agencies have become more aware, open and responsive to customers’ expressed needs, and publish their performance indicators for public scrutiny. The benefits of publishing performance indicators have been found to be that entities:

• Focus more clearly on their mission, and are not side-tracked onto unproductive tasks
• Have an incentive through external pressure to achieve objectives
• Increase the effectiveness and efficiency of their operations, resulting in better value for money

Use of Performance Indicators

• To assess the adequacy of government and managerial policies and the effectiveness of programmes in achieving their objectives; for the road sub-sector, these might be reduction in accidents, improving the road network, reducing the cost of road travel etc.
• To identify critical needs for investment or policy change, by type of investment or region, to determine priorities, and to identify key factors influencing performance
• To provide inputs to managerial decisions such as levels of investment, maintenance expenditures and standards, allocation between regions, and where to focus efforts on policies such as road safety
• To give early warning of undesirable trends and potential future problems
• Incentives for improvements in the effectiveness and efficiency of organisations or agencies, and which could be used a basis of a performance contract between government and the entity
• To enable comparative studies to be made within the sub sector between sub sectors and sectors, geographic regions, or other countries
• Incorporating performance measurement into the design of any programme of activity forces greater consideration of critical assumptions that underlie the relationship and causal paths in the programme. Thus, performance indicators help to clarify the objectives and the logic of the programme
• To help to inform resources allocations decisions if they are used to direct resources to the most successful activities and, thereby, promotes the most efficient use of resources
• To measure progress against indicators may points towards future performance, providing feedback that can be used for planning, identifying areas that need improvement, and suggesting what can be done
• To measure what a programme of activities has achieved relative to its objectives, not just what it has completed; thus, they promote accountability
• To demonstrate results to satisfy an external audience. Performance data can be used to communicate the value of a programme or project to elected officials and the public
• To generate data against which to measure other projects or programmes. They provide a way to improve programmes by learning from success, identifying good performers, and learning from their experience to improve the performance of others
• To measure customer and beneficiary satisfaction, and thereby assess whether and how the programme is improving their lives

Presentation of Performance Indicators

 Since performance indicators are designed for a non-technical audience, the format of their presentation needs to be appropriate. An example is given below:

• Road lighting: The percentage of street lights not working as planned – 1.2%
• Maintaining roads and pavements: The percentage of potholes repaired within 24 hours – 83%
• Pedestrian crossings: The percentage of pedestrian crossing with facilities for disabled people – 49%

Conclusion

The trend for scrutiny and accountability, and the need for stronger justification of investment has rendered the traditional output-related measures of road programme performance inadequate. Public administrations are faced with measuring and publicising their plans and their performance. The historical demands on efficiency to deliver services to the public at minimum cost are still valid. But output measures respond to this need only partially. Road administrations now tend to be evaluated additionally in terms of outcomes and a range of consequences of their activities to meet goals set by a political oversight body.

Performance indicators play a central role in road network management. They help to generate objectives that, augmented by policy guidance from government, politicians and civil society, are reflected in performance indicators for the road system. These objectives are translated, again with policy guidance, into a road programme whose key inputs and processes are evaluated with performance indicators. The delivery of the road programme outputs and processes are monitored with the assistance of performance indicators. Finally, the outcomes of road programme, the programme performance, are analysed with the help of performance indicators. These outcomes co-evolve with influence from outside the road transport sector and have complex consequences for society. The consequences, in turn, stimulate new goals to be achieved with the network management cycle.

Examples of performance indicators in the context of safety on motorways/trunk roads

• Percentage of motorists travelling within speed limit by road type
• Percentage of motorcycles correctly using standard helmet
• Percentage of motorists using child restraint system
• Percentage of motorists using seat belts
• Percentage of motorists using handheld mobiles during driving
• Percentage of vehicles with daytime running lights
• Percentage of vehicles violating posted speed limit
• Percentage of cyclists using helmets
• Percentage of motorists doing drink/drug driving
• Percentage of convictions for drink/drug driving
• Percentage of motorcycles correctly using standard helmets
• Percentage of motorists well conversant of SMART Motorway operation
• Percentage reduction in accidents caused by tail gating
• Percentage reduction in accidents caused by lane changing
• Percentage reduction in the use of mobiles during driving
• Percentage reduction in accidents involving young and inexperienced drivers
• Percentage reduction in side-swipes accidents
• Percentage reduction in rear end collisions
• Percentage reduction in accidents involving only one vehicle
• Percentage reduction in accidents caused by mechanical failure of vehicles
• Percentage reduction in accidents due to drink/drug driving
• Percentage reduction in accidents due to severe weather conditions e.g. heavy snow etc.
• Proportion of patients treated by ambulance staff within 15 minutes
• Percentage reduction of deaths or injuries of pedestrians and cyclists on trunk roads

Examples of key performance indicators commonly used in the construction industry for performance evaluation of consultants/contractors

• Cost predictability
• Time predictability
• Defects
• Product satisfaction
• Service satisfaction
• Health and Safety/Accidents

The scoring criteria for the above performance indicators (usually ranging between 1 & 10) is defined by the clients in detail and agreed upon by the consultants/contractors.

A couple of more examples of key performance indicators are as follows:

• CPI* (Cost Performance Indicator) = budgeted cost of work performed/actual cost of work performed.
• SPI* (Schedule Performance Indicator) = budgeted cost of work performed/budgeted cost of work scheduled

(*In each case a value greater than 1 is good news and a value less than 1 means that some attention is needed)