Performance Management case study 3: PDCA in a non-profit organization
Improving children's quality of life in developing countries is today a priority of thousands of non-for-profit organizations. It is a difficult journey, influenced by many macro and microeconomic, political, social, cultural and religious factors. Many such efforts are structured in programs and projects. Monitoring not only their implementation, but also their impact is a requirement not only for tracking if they make a difference, but also for attracting new funding and other resources for future programs. Overall, many non-profit programs employ robust performance management systems to support the achievement of their purpose. Designing and using such systems is not as straightforward as it may seem.
A non-profit organization.
The organization operates in both urban and rural regions, implementing programs and projects targeting specific health and early childhood development issues.
Improve the health and education of children in at risk communities in developing countries.
A performance management system is in place, linking objectives, performance indicators and initiatives.
To monitor the achievement of this objective a set of performance measures can be established, targeting some of the specific issues to be addressed. For example:
% Incidents of anemia
# Average scores on language and communication skills for toddlers
# Average scores for vocabulary tests
The organization is following the standard Deming cycle applied in a performance management context: Plan-Do-Check-Act (PDCA). Each year it formulates a plan of activities, specifying objectives, performance indicators and projects to be implemented. It monitors results every six months, when following an analysis of these results, review meetings take place. They generally result in a recalibration of initiatives and sometimes new ones are established. Several programs and projects are running at any time, aimed at raising awareness in the community of health and educational issues. Additional projects targeted specific issues such as improving the economic situation of the families in the community, better equipping the kindergarten / primary school and training the educators.
Some success was reflected by the reduction of the incidents of anemia and improvement in the scores.
However, after a while, the performance reports started to reflect a stabilization of results and no further improvements were achieved.
* What changes to the existing portfolio of projects and programs should the organization make to improve results?
* How should the organization alter the Performance Management System in use to facilitate better results?
* What approach to stakeholder management should the organization take to facilitate sustainable changes in the community?
Last edited by Aurel Brudan; 06-17-2010 at 08:15 AM.
Using the traditional Plan - Do - Check - Act (PDCA) approach, the Check and Act phases would resume to gathering performance results data, reviewing it and taking actions to improve results. Generally the initiatives established as a result of this process would aim at doing more of the same thing. Improve efficiency or increase the volume of efforts.
However, a subtle change, that might appear superficial and technical to some, might mean more that it seems. Replacing Check with Study, shifts the emphasis from control and fixing the existing approach to learning and finding new ways to address the issue. For many years performance management has been associated with checking, inspecting, and controlling conformance. Performance Management for learning is a more balanced, mature approach to improvement.
In the case analyzed above, a review of the literature in the field and the latest research in the area of children health and development would reveal that the solution to the stagnation in achieving results might come from a surprising new direction. Under the title “Housing, Health, and Happiness” a new study published by the American Economic Journal: Economic Policy reveals that “replacing dirt floors with cement floors interrupts the transmission of parasitic infestations and should therefore reduce the incidence of both diarrhea and anemia. The reduction in anemia is expected to have positive effects on cognitive development” (Cattaneo et al, 2009).
The study, commissioned by the Mexican government, reveals the following results achieved during the experiment conducted in Mexico (UCBerkeleyNews, 2009):
* 20.1% reduction in incidents of anemia
* 30.2 percent higher score on the McArthur test (language and communication skills for toddlers ages 12 to 30 months)
* 9% improvement in the scores obtained in the PPVT test (vocabulary tests for children ages 36 to 71 months)
When limiting themselves to checking the data and doing more of the same thing, organizations do not create the suitable conditions for leaning and integrating new ideas. Expanding the scope of inquiry from current approaches to researching new ones and investigating what happens in the field they operate in around the world, the improvement process benefits from using a more robust view on performance management, that emphasize the role of the study component.
In the case described above, reviewing recent research in the issue of health and early childhood development reveals a potential new approach that might just be the solution sought after. Setting up a new initiative that aims at replacing dirt floors with cement promises to a positive impact on the health and cognitive development of young children in the targeted community.
Study puts initiatives management in a new light.
Cattaneo, Matias D., Sebastian Galiani, Paul J. Gertler, Sebastian Martinez, and Rocio Titiunik. 2009. "Housing, Health, and Happiness" American Economic Journal: Economic Policy, 1(1): 75–105. Note: a working paper version of the article is available at: http://www.stanford.edu/group/siepr/...df/SCID367.pdf
UCBerkeleyNews, 2009, “Inexpensive flooring change improves child health in urban slums” available at: http://berkeley.edu/news/media/relea...0_floors.shtml, accessed 05 June 2010.
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