The appropriate use of performance measurement in non‐production activity

Abstract

Notes limitations to measuring the performance of design activity in particular, and non‐production activities in general. First, validity and reliability in specific measures are strongly negatively correlated, making it hard to achieve both. Second, outcome measures are jointly determined by engineering design and other activities to varying degrees, and this problem of shared outcomes is only partly reduced by measuring at higher levels of aggregation. Third, there is no definite stopping rule for engineering design activity, yet unambiguous outcome measures rely on the existence of such a rule. Fourth, outcomes attributable to engineering design can sometimes only be measured a long time after completion of the activity, making them ineffective for most managerial purposes. There are also considerable problems in properly accounting for environmental variables. However, the use of performance measures have some benefits, e.g. correcting wrong inferences among engineering managers. Results point to the appropriate use of performance measurement in engineering design for raising questions and detecting discrepancies in performance at aggregate levels. They suggest that using measurement is inappropriate for managerial control, for attributing results to engineers or the environment, and for concluding problem solving activities.