- Email: [email protected]
Developing a performance management framework for a national sport organisation
Sport Management Review 18 (2015) 308–316
Contents lists available at ScienceDirect
Sport Management Review journal homepage: www.elsevier.com/locate/smr
Developing a performance management framework for a national sport organisation Ian O’Boyle * School of Management, City West Campus, University of South Australia, Adelaide, SA 5001, Australia
A R T I C L E I N F O
A B S T R A C T
Article history: Received 4 April 2014 Received in revised form 24 June 2014 Accepted 30 June 2014 Available online 31 July 2014
Organisational performance has become an imperative management function within the non-profit sport context as increased pressure is placed on these organisations to provide a quality service to stakeholders in an accountable and transparent manner. The case presented here examines the issue of developing and implementing a robust performance management tool that can potentially help national sport organisation managers with the multitude of performance challenges now facing these organisations. The theoretical underpinnings of a performance management tool are presented followed by background information to a fictional national sport organisation (Racquetball Australia) and views from the CEO of the organisation in relation to the topic of performance management. The case is written from a fictional perspective so that instructors may adapt the case to suit the geographical context in which the class is taking place. ß 2014 Sport Management Association of Australia and New Zealand. Published by Elsevier Ltd. All rights reserved.
Keywords: Performance management National Sport Organisation Balanced Scorecard
Teaching note 1. Introduction The issue of organisational performance has become an important topic in sport management as the level of public investment in non-profit sport organisations, such as national sport organisations, state sport organisations and similar bodies, has grown to such a level that transparent and accountable measures and systems are called for to monitor such investment. This has not gone unnoticed within the academic world with a number of studies affording attention to this important area (Bayle & Madella, 2002; Bayle & Robinson, 2007; Misener & Doherty, 2009; O’Boyle & Hassan, 2014; Winand, Zintz, Bayle, & Robinson, 2010; Winand, Rihoux, Robinson, & Zintz, 2012). Various government agencies, including the Australian Sport Commission and Sport NZ, are also emphasising the importance of this area with their partner organisations to ensure a good return on the allocation of funding that partner organisations receive. Within the non-profit environment in general, developments such as the McKinsey Capacity Self-Assessment Tool (McKinsey & Company, 2014) and the Organisational Development Tool (Sport NZ, 2014) have been important tools in the practice of performance management adapted to the non-profit sport sector. Likewise in a European context, the Sports Policy Factors Leading to International Sporting Success (SPLISS) project and industry reports from Deloitte and Touche (2003) have provided further evidence of the need for these organisations to develop their management competencies. Industry reports like those mentioned here,
* Tel.: +61 8 830 25159. E-mail addresses: ian.o’[email protected], [email protected] http://dx.doi.org/10.1016/j.smr.2014.06.006 1441-3523/ß 2014 Sport Management Association of Australia and New Zealand. Published by Elsevier Ltd. All rights reserved.
I. O’Boyle / Sport Management Review 18 (2015) 308–316
309
and the SPLISS project in particular, have been an invaluable resource for comparing performance within various organisations and nations, and have provided theoretical models as to how sport organisations may increase their performance through effective policy making and analysis of some key performance indicators. In addition, the professional ethos that has taken hold of the sport industry and the increasing pressure being placed on these organisations from sponsors, government, members and other stakeholders requires adequate systems and processes in place to respond to these demands (Slack, 1985). This traditionally volunteer-led industry has resulted in many non-profit sport organisations lacking the capability and expertise to implement such systems (Cuskelly, Hoye, & Auld, 2006; O’Boyle, 2014). But, given the rise of professionalism and the growth of revenue within the sport industry, we are now seeing these organisations aligning with traditional business practices in terms of organisational performance management (O’Boyle, 2012). The following case highlights the efforts of Racquetball Australia, a fictional national sport organisation, to introduce an organisation-wide performance management system that reflects the strategic imperatives of the organisation and aligns performance reporting with those imperatives. The fundamental dimensions of performance that impact upon the organisation should be addressed and the measures that most appropriately capture the organisation’s true performance must be examined. This fictional case is representative of the non-profit sporting environment that operates in Australasia and most European countries and as such, the case can be adapted to suit a variety of contextual environments. This case study will allow students to: Evaluate the operating environment of a non-profit sport organisation, both internally and externally. Examine if organisation-wide performance management tools such as the Balanced Scorecard are applicable within nonprofit sport organisations. Critically examine the various performance management frameworks available for use by a non-profit sport organisation. Analyse fundamental areas of performance for a non-profit sport organisation. Understand different measures that can indicate if performance targets are being met.
2. Delivery The case is most appropriate for courses relating to sport management, sport governance, sport finance, benchmarking and a range of other sport focussed deliveries. In addition, the case is also relevant to traditional business courses such as organisational theory and organisational behaviour and may provide unique insights into the challenges that non-profit sport organisations face compared to their traditional business counterparts. 2.1. Student activity After students are presented with the case study material, they could be separated into groups to form a ‘committee or board’ within the organisation as the body responsible for developing and implementing a new performance management system. Following group discussion, they could be asked to present their proposal for a new performance management system either orally or in writing to the instructor or class as a whole. Alternatively, students could address the case on an individual basis (as a consultant) and present their proposal for a new performance management system in a similar manner. Taking into account the case study material, the templates for a performance management tool as discussed below, and the unique operating environment of the non-profit sport industry, two example tasks may be: i. Choose one of the performance management templates (Balanced Scorecard, Performance Prism or Organisational Development Tool) described below and apply it to Racquetball Australia. ii. Based on the operating environment of Racquetball Australia and the information supplied regarding performance management tools, develop what you perceive to be a suitable performance management template taking ideas from each existing tool and incorporate appropriate measures for each performance dimension you identify. 2.2. Case resources
The Balanced Scorecard The Performance Prism Sport NZ: Organisational Development Tool Performance Management in Action: The NZRU ‘Scoreboard’
References Bayle, E., & Madella, A. (2002). Development of a taxonomy of performance for national sport organizations. European Journal of Sport Science, 2(2), 1–21. Bayle, E., & Robinson, L. (2007a). A framework for understanding the performance of national governing bodies of sport. European Sport Management Quarterly, 7, 240–268.
310
I. O’Boyle / Sport Management Review 18 (2015) 308–316
Cuskelly, G., Hoye, R., & Auld, C. (2006). Working with volunteers in sport: Theory and practice. London: Routledge. Deloitte, & Touche (2003). Investing in change: High level review of the modernisation programme for governing bodies of sport. London, UK: Deloitte & Touche. Mckinsey & Company (2014). Organizational capacity assessment tool. Retrieved from: https://mckinseyonsociety.com/ocat/ Misener, K., & Doherty, A. (2009). A case study of organizational capacity in community sport. Journal of Sport Management, 23(4), 457–482. O’Boyle, I. (2012a). The Identification and management of fundamental performance dimensions in national level non-profit sport management. University of Ulster (Ph.D. thesis). O’Boyle, I. (2014). Determining best practice in performance monitoring and evaluation of sport coaches: Lessons from the traditional business environment. International Journal of Sports Science and Coaching, 9(1), 233–246. O’Boyle, I., & Hassan, D. (2014). Performance management and measurement in national level non-profit sport organisations. European Sport Management Quarterly. http://dx.doi.org/10.1080/16184742.2014.898677 Slack, T. (1985). The bureaucratization of a voluntary sport organization. International Review for the Sociology of Sport, 20(3), 145–164. Sport NZ (2014a). Organisational development tool. Retrieved from: http://www.sportnz.org.nz/en-nz/our-partners/Developing-Capabilities/OrganisationalDevelopment-Tool/ Winand, M., Zintz, T., Bayle, E., & Robinson, L. (2010). Organizational performance of Olympic sport governing bodies: Dealing with measurement and priorities. Managing Leisure, 15(4), 279–307. Winand, M., Rihoux, B., Robinson, L., & Zintz, T. (2012). Pathways to high performance: A qualitative comparative analysis of sport governing bodies. Nonprofit and Voluntary Sector Quarterly, 42(4), 739–762.
I. O’Boyle / Sport Management Review 18 (2015) 308–316
311
Developing a performance management framework for a national sport organisation Case study
1. Introduction Managing organisational performance is a fundamental requirement for any successful non-profit sport organisation (Bayle & Robinson, 2007). It is an integral component of an organisation’s ability to deliver a quality service to its stakeholders, including those at club, regional, national and international levels (O’Boyle, 2012). However, if an organisation fails to manage performance in an effective manner, the end result could potentially be catastrophic in terms of its long term sustainability and its ability to service stakeholders. Mismanagement and underperformance may also lead to intervention from state bodies such as the Australian Sport Commission in Australia, Sport NZ in New Zealand and equivalent organisations in other countries that often have a vested interest in the performance of these organisations as a result of taxpayer funding allocations. 2. Performance management tools Performance management has been used as a broad term to describe many different facets of an organisation’s performance (Bourne, Franco, & Wilkes, 2003; Neely, 2005; O’Boyle, 2012; O’Boyle & Hassan, 2013). Specific tools such as the Balanced Scorecard have been developed and implemented within the traditional business environment to address the issues of organisational-wide performance management by identifying core dimensions of performance within all types of organisations. These practices have been proven to be effective for organisations operating outside of the sport sector but the applicability of these tools within non-profit sport organisations is undetermined. The Balanced Scorecard, designed by Kaplan and Norton (1992). And its derivatives are the most utilised performance management tools in the wider business environment and have also been adopted by other organisations outside of the for-profit sector. Their use and applicability within non-profit sport organisations is as of yet unknown and students should identify whether or not they have relevance within the non-profit sporting environment. 2.1. The Balanced Scorecard Kaplan and Norton (1992) developed this performance management tool, which has been used as an effective strategic planning and management tool by many organisations and across varied industries. It has provided senior management and boards with an effective way of monitoring actions and processes undertaken by employees and allowed them to keep a record of these actions and consequences in an efficient and defined manner. The Balanced Scorecard is the most widely used of the various performance management tools that have become available and although initially only adopted in mostly western countries, it has now spread throughout the global business environment. Since 2000, use of the Balanced Scorecard and its derivatives, such as the Performance Prism (Neely, Adams, & Kennerley, 2002), have become commonplace in organisations throughout the world. Kurtzman (1997) claims that almost 70% of companies responding to a questionnaire were measuring organisational performance in a way that was extremely similar to that of the Balanced Scorecard. This method of performance management has been implemented by government institutions, small businesses and corporations; but as mentioned, there is no evidence to suggest that it has been adopted by non-profit sport organisations. Standardised Balanced Scorecards (working off a common template) are easily accessible for organisations and can have a potentially positive impact on many organisations. However, using one organisation’s Balanced Scorecard and attempting to apply it to another organisation can prove problematic and research has suggested that one of the major benefits of the Scorecard lies within the design process itself (Kurtzman, 1997). The unique aspect of the Balanced Scorecard, which was seen as a radically new development in the measurement initiatives adopted by organisations, was that it combined financial and non-financial aspects of organisations to give a more detailed view of how the organisation was actually performing within its operating environment. In addition, utility and clarity were further enhanced as Kaplan and Norton suggested measures that should be condensed and grouped together so they could be easily displayed within a simple four box model (Kaplan & Norton, 1992, 1993). It became clear that the selection of measures, relating to both the filtering and clustering process, were the integral activities that management must address in the implementation of this system. The measures that were to be selected, according to Kaplan and Norton, should be synonymous with issues and initiatives that were relevant within the organisation’s strategic plan. A simple process of requiring information concerning attitudinal issues would determine which measures should be associated with each perspective (Kaplan & Norton, 1992).
312
I. O’Boyle / Sport Management Review 18 (2015) 308–316
As noted above, Kaplan and Norton’s (1992) initial design was laid out as a simple ‘four box’ model that could help organisations ensure they were getting the best results out of the resources available to them. The model suggested that financial measures should not be the only perspective analysed. They proposed three additional perspectives to represent the major concerns within an organisation: Internal Business Process, Learning and Growth, and the Customer. Research surrounding the Balanced Scorecard is vast and some authors have suggested the renaming of these perspectives as well as the addition of further perspectives to the model. This may have particular importance for the adoption of the tool within non-profit sport organisations as these entities often have comparatively different performance dimensions to those operating within a traditional profit-driven business environment. These arguments have become apparent as a result of recognition that dissimilar but equivalent perspectives would potentially give rise to a different set of measures. A crucial element of the adoption of this model is that users have confidence around the aspects chosen to be measured and that they are relevant; otherwise, results achieved may be regarded as insignificant. In the current case, the specific operating environment, strategic imperatives and key performance challenges facing the national sporting organisations require examination to ensure that the most relevant dimensions of performance and associated goals and measures are selected for inclusion with the Balanced Scorecard. 2.2. The performance prism The model developed by Neely et al. (2002) attempts to distinguish itself from other similar models, such as the Balanced Scorecard, by offering a unique perspective on a measuring system that can ultimately be adopted as a way of operating within an industry, rather than just as a performance measure. The Balanced Scorecard (Kaplan & Norton, 1992) only outlines four different aspects of an organisation to be measured: finance; customers; internal processes; and innovation and learning. As a result, Neely et al. (2002) suggest it ignores the crucial role that the various stakeholders of an organisation have in determining the success or failure of its strategic objectives. Other models such as the Business Excellence model (EFQM, 2005) combine outcomes that can be easily measured with business enablers. Similarly, models such as Shareholder Value Frameworks (Srivastava, Shervani, & Fahey, 1998) incorporate the overall cost of capital into their models but still fail to acknowledge performance issues relating to stakeholders. In addition, Kaplan and Bruns’ (1987) model relating to ‘activity based costing’ and Feigenbaum’s (1991) ‘cost of quality’ model focus on aspects that do not necessarily add value to the organisation. The major limitation of these models is that they do not analyse the importance of stakeholders in relation to performance – a performance dimension that appears to be of significant importance for non-profit sport organisations. The designers of this model use the word ‘Prism’ in its title to establish a connection between performance management and the fact that a prism is a device that refracts light. A prism can reveal the ‘‘hidden elements behind something as apparently simple as white light’’ (Neely et al., 2002, p. 4). It illustrates the hidden complexities behind the issues of performance management that can affect an organisation. The authors argue that previous performance management models have failed to address all areas of performance within an organisation. They further argue that while each of these frameworks has provided a unique perspective on performance, they do not analyse organisational performance as an entire entity. In contrast, they suggest that the Performance Prism attempts to establish five different fundamental questions for management to draw upon in order to assess the true scope of the organisation’s performance management issues: 1. 2. 3. 4. 5.
Stakeholder Satisfaction: What are the wants and needs of our stakeholders? Stakeholder Contribution: What can our stakeholders provide to us? Strategies: Which strategies are best to implement in order to satisfy stakeholder demands? Processes: Which processes should be adopted to satisfy stakeholder demands? Capabilities: What practices, people, technology and infrastructure is required so processes and strategies can be fully implemented?
2.3. Sport NZ: Organisational Development Tool The Organisational Development Tool (ODT) is a software application unique to Sport NZ which was developed based on Malcolm Baldrige’s (2005) performance management criteria. This tool is a comprehensive ‘‘one-off application’’ as opposed to an on-going performance management process to measure overall organisational effectiveness. The ODT analyses areas as diverse as culture, values, strategy, finances and human resources. Specifically, the ODT examines various aspects of the organisation related to six different areas: leadership; planning; customer focus; sport delivery; people management; and sport management (Sport NZ, 2014). It is a self-assessment tool that has the ability to generate recommendations and can be applied to organisations as large as national sport organisations or as small as community based sport clubs. The ODT provides in depth analysis relating to a number of areas of organisational effectiveness but it is not without limitations. Performance dimensions such as individual employee performance are not assessed within its scope (O’Boyle, 2013; O’Boyle & Cummins, 2013) and, in line with other performance management frameworks, it requires substantial investment of both time and cost to conduct the review. Sport NZ uses the tool to assess the performance of various sport bodies within the New Zealand sport industry (Sport NZ, 2014). Although not a sufficient replacement for an on-going robust performance management process and perhaps lacking the inclusion of some performance dimensions, the creation of such a tool by Sport
I. O’Boyle / Sport Management Review 18 (2015) 308–316
313
NZ is a positive indication that non-profit sport organisations are beginning to understand the importance of combining the various facets of their operations to create a transparent, accountable and ultimately high performing organisation (O’Boyle & Hassan, 2013). 3. National Sport Organisation: Racquetball Australia Racquetball Australia is the national sport organisation responsible for governing and developing racquetball within Australia. The organisation is responsible for organising and managing all levels of the sport within Australia and for producing representatives for the Australian national team to compete at international events. The organisation has a high performance centre located in the Australian Capital Territory and runs various initiatives to promote and encourage the game at the grassroots level through its various affiliated bodies. Two years ago, the organisation launched a national development programme with the aim of getting more individuals involved in the sport and retaining those individuals who already participate through playing, coaching, officiating or volunteering. This initiative focussed on all levels and demographics within Australia and programmes were designed at both school and club levels in order to attract new participants from various age groups. Initiatives at the school level in particular were seen as being of major importance in order to establish an interest with young participants and encourage parents and teachers to become involved in coaching and volunteer roles, which indeed, may lay the foundations for further initiatives at high school and club levels. In addition, the organisation implemented a player and coach pathways system at the same time in order to provide clear direction and opportunities for aspiring players and coaches within the sport. Racquetball Australia has invested heavily in the development of the sport throughout Australia and the ability to do this has come from a diverse income mix consisting of government funding, commercial sponsorship, member levies and philanthropic grants. When the organisation hosts an international test match it must absorb all expenses of the event including the expenses of the touring team. Commercial sponsorship in particular has been an important revenue stream for the organisation and it wishes to place a large emphasis on ensuring that sponsors are satisfied with their return on investment and their relationship with Racquetball Australia in order to secure long term deals moving forward. 3.1. The strategic plan Racquetball Australia’s strategic plan, entitled ‘‘Strive for Greatness,’’ was designed in order to facilitate the growth and success of the game at the domestic level and at major international events. The plan has a focus on advancing the sport through higher levels of on-court performance including improving results of national team players, while also focusing on the development of off-court performance through increasing revenue streams, organisational performance, and improving governance structures within the sport as a whole in Australia. The vision and objectives for the organisation require success and improvement in all areas of the game from community through to elite levels. The four year strategic plan is broken down into annual operational plans with specific objectives to be achieved within that timeframe. The organisation developed the current strategic plan through a strategic framework of linking the vision of the organisation to its purpose; much like the principles behind the Balanced Scorecard (Kaplan & Norton, 1992). The key imperatives for Racquetball Australia are addressed in the following subsections. 3.1.1. Culture of Excellence Racquetball Australia wishes to establish a culture of excellence relating to playing performances and the internal performance of the organisation itself. The organisation acknowledges that if it is to achieve such a culture of excellence, it will require substantial improvements in all areas of on-court performance from the community level of the sport through to representative national teams. Racquetball Australia proposes to create such a culture through: reviewing lines of accountability and values; promoting behaviour that facilitates the implementation of a culture of excellence; working harder to improve communication with all stakeholders; creating a working environment where performance is robustly scrutinised; and attracting and retaining high calibre personnel within the organisation both at board and management levels. 3.1.2. National teams Racquetball Australia believes that, in order for the organisation to have the ability to stimulate growth, attract sponsorship and increase other revenue streams, the success of the men’s and women’s representative national teams is paramount. The high performance programme that operates within the organisation is strategically structured to facilitate the success of the national teams at international competitions. There are a number of issues that the organisation must focus on in order to foster this development of high performance at the international level. 3.1.3. Player and coach development Racquetball Australia wants to have structures in place that can identify suitable players who have the potential to compete at the elite level. Player development pathways and the appropriate services and facilities will be available to prospective elite players. A strategic alliance with the sport’s Players Association is required in order to keep lines of communication open between the two parties.
314
I. O’Boyle / Sport Management Review 18 (2015) 308–316
Likewise for coaches, it is important that identification and development systems are in place in order to grow the number of elite level coaches within Australia. Implementing a robust coaching review mechanism to establish accountability and provide coaches with the opportunity to identify areas of improvement is required. 3.1.4. Elite services The organisation wants to recruit and retain high calibre individuals capable of managing the needs of an elite level national team. The delivery of world class sport science services to players and coaches is also a crucial element of success in any contemporary national sport organisation. The organisation must also ensure that all equipment, playing and practice facilities are of a standard suitable to an elite level national team. 3.1.5. Stakeholders As a result of the implementation of an independent board (where there is no regional representation), it is essential that the organisation develops and improves clear lines of communication between the organisation and its various stakeholders. These stakeholders include members via regional associations, clubs, schools, sponsors and the general public. It is crucial that the goals and objectives of affiliated entities are aligned with the overall aims of the organisation as laid out in the strategic plan. These organisations are the catalyst for Racquetball Australia achieving or failing in its strategic direction. In order to successfully grow and develop the sport, the organisation must also ensure there are good lines of communication between a number of other entities such as supporters, the International Governing Body, the government agency for sport, and volunteers. 3.1.6. Sustainable growth In order to sustain an adequate level of growth in the game, Racquetball Australia will recruit new players, coaches, officials and volunteers, and focus on retention strategies of those individuals and groups who are already involved within the sport at various levels. In order to facilitate an effective recruitment and retention strategy, it is imperative for the organisation to understand the needs and expectations of the various groups involved. Increasing participation levels is a major area of concern and suitable structures to promote and attract new participants to the game should be in place, particularly at the ‘grass roots’ level. A particular demographic that the organisation must focus on is female participants as currently they are underrepresented within the sport. Finally, volunteers must not be undervalued at any level within the game and they should be provided with adequate training and resources to grow the game at the club and school level. 3.1.7. Commercial aspects of the sport Racquetball Australia wants to explore new revenue streams that can provide the organisation with the capability to achieve strategic goals. The management of existing commercial revenue streams such as sponsorship arrangements, member levies and government funding must be constantly evaluated and assessed to ensure stakeholder satisfaction and to provide security for financial health within the organisation. In order to attract additional revenue streams, particularly from commercial sponsors, it is important that the organisation generates a public image that upholds and promotes the values of sport, acts as a transparent entity, communicates effectively with stakeholders and has the ability to deliver entertaining and successful sporting events. These activities should be underpinned by appropriate governance structures, high calibre management and board members, and ultimately, a robust performance management system. 4. Developing a performance management framework: views of the CEO This section describes the need for a performance management framework to be developed within Racquetball Australia. This is required in order to reflect the priorities of the Strategic Plan set out above and to help the organisation achieve these objectives. This section also includes the views of the (hypothetical) Chief Executive officer (CEO) of Racquetball Australia who was interviewed in relation to the development of a performance management framework within the sport. The establishment of an organisational wide performance management system is a practice that Racquetball Australia knows it must introduce to improve overall results and outputs and to increase organisational performance as a whole. At present, a formal performance management system does not exist within the organisation but the CEO believes the implementation of such a practice could provide real benefits in relation to managing performance objectives and its accountability function to government, sponsors, members and other stakeholders. As non-profit sport organisations become more professional in their approach, commentators believe the industry should move to a situation in which nonprofit sport organisations are appraised as commercial entities (Chappelet & Bayle, 2005). The CEO states that, ‘‘using sustainable systems and processes is critical and has to be led by a capable management team and supported by a skilled board.’’ The board of Racquetball Australia has been appointed following an independent national recruitment campaign to ensure that the organisation has high calibre individuals with business acumen running the organisation. However, an ongoing performance management practice has not yet been implemented. The CEO goes on to claim that it is, ‘‘important to have a formalised system as a number of departments have to be aligned and there is a strong accountability function to government, which invests heavily in the sport.’’ Currently, performance management within Racquetball Australia is
I. O’Boyle / Sport Management Review 18 (2015) 308–316
315
limited to a traffic light system of whether or not objectives have been achieved (green), ongoing (amber), or not achieved (red). The CEO claims that, ‘‘an organisation-wide performance management tool does not currently exist within the organisation.’’ He concedes that, ‘‘it is a crucial area for improvement.’’ He adds a possible reason as to why such a practice does not currently operate in the organisation: ‘‘performance management can be seen as a frustrating timewaster that takes people away from their main roles and responsibilities.’’ However, he goes on to add that, ‘‘it is the role of the board, CEO and senior management to stress the importance of such a practice and convey that performance management can ultimately help the organisation operate more effectively and achieve objectives far more efficiently than if there were no such practice in place.’’ Pulakos (2009) describes how some organisations find it difficult to fully engage with suitable performance management approaches and suggests an individualised system must be adopted to suit each organisation. A performance management system that is seen to be a timewaster by staff is clearly of little benefit to the organisation and such a system should be reevaluated to ensure it serves a real purpose for the organisation (Pulakos, 2009). It may take some time and ongoing adjustment to establish a system that truly meets the needs of an organisation, such as Racquetball Australia, that may have multiple objectives operating within variable timeframes. The CEO confirms this synopsis by stating that, ‘‘there is a wide range of size and capability within sport organisations; not one model suits all.’’ The modern non-profit sport organisation is a multi-faceted entity with often complex governance structures and various stakeholders who can make it difficult to implement an effective performance management approach (Pulakos, 2009; Yeh & Taylor, 2008). The CEO suggests that one of the major functions of the national sport organisation is to have the ability to measure its own performance but also to measure the performance of its partner organisations (state bodies and regional affiliates). He states that partner organisations are, ‘‘currently required to submit strategic plans and must report against those plans as a condition of funding; but more should be done to ensure a good return on investment of public finances.’’ While Racquetball Australia must convey to its own staff that the implementation of an appropriate performance management practice is not a time waster, it must do the same for its partner organisations and perhaps make this a condition of funding. However, as the CEO points out, ‘‘Racquetball Australia must not be seen as a bureaucracy, but instead, highly flexible and relevant to the affiliated bodies.’’ The overall success of Racquetball Australia’s objectives is largely dependent on the capability and willingness of its partner organisations to align their resources and strategic direction with those of the organisation. Alarmingly, the CEO makes the statement: ‘‘ultimately our partner organisations will create direction for themselves. Hopefully, it is in line with our direction.’’ Ideally, this would not be the case within the sport, and partner organisations would be held more accountable for the funding they receive and a common robust performance management process would be implemented within racquetball to ensure key alignment of objectives, resources and efforts across the entire sport. This situation would also address the prevalent issue of Racquetball Australia’s inability to obtain reliable information (data) relating to various programmes and initiatives from its partner organisations as described by the CEO. 5. Summary The CEO suggests that, ‘‘commercial organisations with a product to sell put a large emphasis on performance reporting and data analysis; it is time for sport organisations to do the same.’’ He believes that in order to do this, the organisation must communicate expectations in a clear, accurate and transparent manner as, ‘‘improving partner organisations’ respective ability to perform is crucial.’’ He acknowledges that, ‘‘the sector is not good at monitoring and evaluating performance,’’ but claims that the organisation will invest heavily in this area and the impending implementation of, ‘‘robust performance management practices will provide better investment.’’ He summarises by stating: ‘‘the closer our sport gets to adopting commercial and professional approaches to performance management, the more effective and efficient we will become.’’ References Bayle, E., & Robinson, L. (2007b). A framework for understanding the performance of national governing bodies of sport. European Sport Management Quarterly, 7, 240–268. Bourne, M., Franco, M., & Wilkes, J. (2003). Corporate performance management. Measuring Business Excellence, 7(3), 15–21. Chappelet, J., & Bayle, E. (2005). Strategic and performance management of Olympic sport organisations. Champaign: Human Kinetics. European Foundation for Quality Management (2005). The EFQM framework for knowledge management. European Foundation for Quality Management. Brussels: Author. Feigenbaum, A. V. (1991). Total quality control (3rd ed.). New York: McGraw-Hill. Kaplan, R. S., & Bruns, W. (1987). Accounting and management: A field study perspective. Boston: Harvard Business School Press, Print. Kaplan, R. S., & Norton, D. P. (1992, January). The balanced scorecard: Measures that drive performance. Harvard Business Review, 71–80. Kaplan, R. S., & Norton, D. P. (1993, September). Putting the balanced scorecard to work. Harvard Business Review, 2–16. Kurtzman, J. (1997, February). Is your company off course? Now you can find out why. Fortune, 128–130. Malcolm Baldrige National Quality Award (2005). Criteria for performance excellence. Gaithersburg, USA: National Institute of Standards and Technology. Neely, A. (2005). The evolution of performance measurement research: Developments in the last decade and a research agenda for the next. International Journal of Operations & Production Management, 25(12), 1264–1277. Neely, A., Adams, C., & Kennerley, M. (2002). The performance prism. Financial Times. Prentice Hall. O’Boyle, I. (2012b). Performance management in sport. In S. Leberman, C. Collins, & L. Trenberth (Eds.), Sport business management in New Zealand and Australia (pp. 363–377). Melbourne: Cengage Learning. O’Boyle, I. (2013). Individual performance management: A review of current practices. Asia-Pacific Management and Business Application, 2(1), 1–22.
316
I. O’Boyle / Sport Management Review 18 (2015) 308–316
O’Boyle, I., & Cummins, P. (2013). Examining theories of individual performance management. Training & Management Development Methods, 27(5), 3.69–3.78. O’Boyle, I., & Hassan, D. (2013). Organizational performance management: Examining the practical utility of the performance prism. The Organizational Development Journal, 31(3), 51–58. Pulakos, E. D. (2009). Performance management: A new approach for driving business results. Chichester, West Sussex, UK: Wiley-Blackwell, Print. Sport NZ (2014b). Organisational development tool. Retrieved from: http://www.sportnz.org.nz/en-nz/our-partners/Developing-Capabilities/OrganisationalDevelopment-Tool/ Srivastava, R. K., Shervani, T. A., & Fahey, L. (1998). Market-based assets and shareholder value: A framework for analysis. Journal of Marketing, 62, 2–18. Yeh, C., & Taylor, T. L. (2008). Issues of governance in sport organisations: A question of board size, structure and roles. World Leisure Journal, 50(1), 33–45.
Contents lists available at ScienceDirect
Sport Management Review journal homepage: www.elsevier.com/locate/smr
Developing a performance management framework for a national sport organisation Ian O’Boyle * School of Management, City West Campus, University of South Australia, Adelaide, SA 5001, Australia
A R T I C L E I N F O
A B S T R A C T
Article history: Received 4 April 2014 Received in revised form 24 June 2014 Accepted 30 June 2014 Available online 31 July 2014
Organisational performance has become an imperative management function within the non-profit sport context as increased pressure is placed on these organisations to provide a quality service to stakeholders in an accountable and transparent manner. The case presented here examines the issue of developing and implementing a robust performance management tool that can potentially help national sport organisation managers with the multitude of performance challenges now facing these organisations. The theoretical underpinnings of a performance management tool are presented followed by background information to a fictional national sport organisation (Racquetball Australia) and views from the CEO of the organisation in relation to the topic of performance management. The case is written from a fictional perspective so that instructors may adapt the case to suit the geographical context in which the class is taking place. ß 2014 Sport Management Association of Australia and New Zealand. Published by Elsevier Ltd. All rights reserved.
Keywords: Performance management National Sport Organisation Balanced Scorecard
Teaching note 1. Introduction The issue of organisational performance has become an important topic in sport management as the level of public investment in non-profit sport organisations, such as national sport organisations, state sport organisations and similar bodies, has grown to such a level that transparent and accountable measures and systems are called for to monitor such investment. This has not gone unnoticed within the academic world with a number of studies affording attention to this important area (Bayle & Madella, 2002; Bayle & Robinson, 2007; Misener & Doherty, 2009; O’Boyle & Hassan, 2014; Winand, Zintz, Bayle, & Robinson, 2010; Winand, Rihoux, Robinson, & Zintz, 2012). Various government agencies, including the Australian Sport Commission and Sport NZ, are also emphasising the importance of this area with their partner organisations to ensure a good return on the allocation of funding that partner organisations receive. Within the non-profit environment in general, developments such as the McKinsey Capacity Self-Assessment Tool (McKinsey & Company, 2014) and the Organisational Development Tool (Sport NZ, 2014) have been important tools in the practice of performance management adapted to the non-profit sport sector. Likewise in a European context, the Sports Policy Factors Leading to International Sporting Success (SPLISS) project and industry reports from Deloitte and Touche (2003) have provided further evidence of the need for these organisations to develop their management competencies. Industry reports like those mentioned here,
* Tel.: +61 8 830 25159. E-mail addresses: ian.o’[email protected], [email protected] http://dx.doi.org/10.1016/j.smr.2014.06.006 1441-3523/ß 2014 Sport Management Association of Australia and New Zealand. Published by Elsevier Ltd. All rights reserved.
I. O’Boyle / Sport Management Review 18 (2015) 308–316
309
and the SPLISS project in particular, have been an invaluable resource for comparing performance within various organisations and nations, and have provided theoretical models as to how sport organisations may increase their performance through effective policy making and analysis of some key performance indicators. In addition, the professional ethos that has taken hold of the sport industry and the increasing pressure being placed on these organisations from sponsors, government, members and other stakeholders requires adequate systems and processes in place to respond to these demands (Slack, 1985). This traditionally volunteer-led industry has resulted in many non-profit sport organisations lacking the capability and expertise to implement such systems (Cuskelly, Hoye, & Auld, 2006; O’Boyle, 2014). But, given the rise of professionalism and the growth of revenue within the sport industry, we are now seeing these organisations aligning with traditional business practices in terms of organisational performance management (O’Boyle, 2012). The following case highlights the efforts of Racquetball Australia, a fictional national sport organisation, to introduce an organisation-wide performance management system that reflects the strategic imperatives of the organisation and aligns performance reporting with those imperatives. The fundamental dimensions of performance that impact upon the organisation should be addressed and the measures that most appropriately capture the organisation’s true performance must be examined. This fictional case is representative of the non-profit sporting environment that operates in Australasia and most European countries and as such, the case can be adapted to suit a variety of contextual environments. This case study will allow students to: Evaluate the operating environment of a non-profit sport organisation, both internally and externally. Examine if organisation-wide performance management tools such as the Balanced Scorecard are applicable within nonprofit sport organisations. Critically examine the various performance management frameworks available for use by a non-profit sport organisation. Analyse fundamental areas of performance for a non-profit sport organisation. Understand different measures that can indicate if performance targets are being met.
2. Delivery The case is most appropriate for courses relating to sport management, sport governance, sport finance, benchmarking and a range of other sport focussed deliveries. In addition, the case is also relevant to traditional business courses such as organisational theory and organisational behaviour and may provide unique insights into the challenges that non-profit sport organisations face compared to their traditional business counterparts. 2.1. Student activity After students are presented with the case study material, they could be separated into groups to form a ‘committee or board’ within the organisation as the body responsible for developing and implementing a new performance management system. Following group discussion, they could be asked to present their proposal for a new performance management system either orally or in writing to the instructor or class as a whole. Alternatively, students could address the case on an individual basis (as a consultant) and present their proposal for a new performance management system in a similar manner. Taking into account the case study material, the templates for a performance management tool as discussed below, and the unique operating environment of the non-profit sport industry, two example tasks may be: i. Choose one of the performance management templates (Balanced Scorecard, Performance Prism or Organisational Development Tool) described below and apply it to Racquetball Australia. ii. Based on the operating environment of Racquetball Australia and the information supplied regarding performance management tools, develop what you perceive to be a suitable performance management template taking ideas from each existing tool and incorporate appropriate measures for each performance dimension you identify. 2.2. Case resources
The Balanced Scorecard The Performance Prism Sport NZ: Organisational Development Tool Performance Management in Action: The NZRU ‘Scoreboard’
References Bayle, E., & Madella, A. (2002). Development of a taxonomy of performance for national sport organizations. European Journal of Sport Science, 2(2), 1–21. Bayle, E., & Robinson, L. (2007a). A framework for understanding the performance of national governing bodies of sport. European Sport Management Quarterly, 7, 240–268.
310
I. O’Boyle / Sport Management Review 18 (2015) 308–316
Cuskelly, G., Hoye, R., & Auld, C. (2006). Working with volunteers in sport: Theory and practice. London: Routledge. Deloitte, & Touche (2003). Investing in change: High level review of the modernisation programme for governing bodies of sport. London, UK: Deloitte & Touche. Mckinsey & Company (2014). Organizational capacity assessment tool. Retrieved from: https://mckinseyonsociety.com/ocat/ Misener, K., & Doherty, A. (2009). A case study of organizational capacity in community sport. Journal of Sport Management, 23(4), 457–482. O’Boyle, I. (2012a). The Identification and management of fundamental performance dimensions in national level non-profit sport management. University of Ulster (Ph.D. thesis). O’Boyle, I. (2014). Determining best practice in performance monitoring and evaluation of sport coaches: Lessons from the traditional business environment. International Journal of Sports Science and Coaching, 9(1), 233–246. O’Boyle, I., & Hassan, D. (2014). Performance management and measurement in national level non-profit sport organisations. European Sport Management Quarterly. http://dx.doi.org/10.1080/16184742.2014.898677 Slack, T. (1985). The bureaucratization of a voluntary sport organization. International Review for the Sociology of Sport, 20(3), 145–164. Sport NZ (2014a). Organisational development tool. Retrieved from: http://www.sportnz.org.nz/en-nz/our-partners/Developing-Capabilities/OrganisationalDevelopment-Tool/ Winand, M., Zintz, T., Bayle, E., & Robinson, L. (2010). Organizational performance of Olympic sport governing bodies: Dealing with measurement and priorities. Managing Leisure, 15(4), 279–307. Winand, M., Rihoux, B., Robinson, L., & Zintz, T. (2012). Pathways to high performance: A qualitative comparative analysis of sport governing bodies. Nonprofit and Voluntary Sector Quarterly, 42(4), 739–762.
I. O’Boyle / Sport Management Review 18 (2015) 308–316
311
Developing a performance management framework for a national sport organisation Case study
1. Introduction Managing organisational performance is a fundamental requirement for any successful non-profit sport organisation (Bayle & Robinson, 2007). It is an integral component of an organisation’s ability to deliver a quality service to its stakeholders, including those at club, regional, national and international levels (O’Boyle, 2012). However, if an organisation fails to manage performance in an effective manner, the end result could potentially be catastrophic in terms of its long term sustainability and its ability to service stakeholders. Mismanagement and underperformance may also lead to intervention from state bodies such as the Australian Sport Commission in Australia, Sport NZ in New Zealand and equivalent organisations in other countries that often have a vested interest in the performance of these organisations as a result of taxpayer funding allocations. 2. Performance management tools Performance management has been used as a broad term to describe many different facets of an organisation’s performance (Bourne, Franco, & Wilkes, 2003; Neely, 2005; O’Boyle, 2012; O’Boyle & Hassan, 2013). Specific tools such as the Balanced Scorecard have been developed and implemented within the traditional business environment to address the issues of organisational-wide performance management by identifying core dimensions of performance within all types of organisations. These practices have been proven to be effective for organisations operating outside of the sport sector but the applicability of these tools within non-profit sport organisations is undetermined. The Balanced Scorecard, designed by Kaplan and Norton (1992). And its derivatives are the most utilised performance management tools in the wider business environment and have also been adopted by other organisations outside of the for-profit sector. Their use and applicability within non-profit sport organisations is as of yet unknown and students should identify whether or not they have relevance within the non-profit sporting environment. 2.1. The Balanced Scorecard Kaplan and Norton (1992) developed this performance management tool, which has been used as an effective strategic planning and management tool by many organisations and across varied industries. It has provided senior management and boards with an effective way of monitoring actions and processes undertaken by employees and allowed them to keep a record of these actions and consequences in an efficient and defined manner. The Balanced Scorecard is the most widely used of the various performance management tools that have become available and although initially only adopted in mostly western countries, it has now spread throughout the global business environment. Since 2000, use of the Balanced Scorecard and its derivatives, such as the Performance Prism (Neely, Adams, & Kennerley, 2002), have become commonplace in organisations throughout the world. Kurtzman (1997) claims that almost 70% of companies responding to a questionnaire were measuring organisational performance in a way that was extremely similar to that of the Balanced Scorecard. This method of performance management has been implemented by government institutions, small businesses and corporations; but as mentioned, there is no evidence to suggest that it has been adopted by non-profit sport organisations. Standardised Balanced Scorecards (working off a common template) are easily accessible for organisations and can have a potentially positive impact on many organisations. However, using one organisation’s Balanced Scorecard and attempting to apply it to another organisation can prove problematic and research has suggested that one of the major benefits of the Scorecard lies within the design process itself (Kurtzman, 1997). The unique aspect of the Balanced Scorecard, which was seen as a radically new development in the measurement initiatives adopted by organisations, was that it combined financial and non-financial aspects of organisations to give a more detailed view of how the organisation was actually performing within its operating environment. In addition, utility and clarity were further enhanced as Kaplan and Norton suggested measures that should be condensed and grouped together so they could be easily displayed within a simple four box model (Kaplan & Norton, 1992, 1993). It became clear that the selection of measures, relating to both the filtering and clustering process, were the integral activities that management must address in the implementation of this system. The measures that were to be selected, according to Kaplan and Norton, should be synonymous with issues and initiatives that were relevant within the organisation’s strategic plan. A simple process of requiring information concerning attitudinal issues would determine which measures should be associated with each perspective (Kaplan & Norton, 1992).
312
I. O’Boyle / Sport Management Review 18 (2015) 308–316
As noted above, Kaplan and Norton’s (1992) initial design was laid out as a simple ‘four box’ model that could help organisations ensure they were getting the best results out of the resources available to them. The model suggested that financial measures should not be the only perspective analysed. They proposed three additional perspectives to represent the major concerns within an organisation: Internal Business Process, Learning and Growth, and the Customer. Research surrounding the Balanced Scorecard is vast and some authors have suggested the renaming of these perspectives as well as the addition of further perspectives to the model. This may have particular importance for the adoption of the tool within non-profit sport organisations as these entities often have comparatively different performance dimensions to those operating within a traditional profit-driven business environment. These arguments have become apparent as a result of recognition that dissimilar but equivalent perspectives would potentially give rise to a different set of measures. A crucial element of the adoption of this model is that users have confidence around the aspects chosen to be measured and that they are relevant; otherwise, results achieved may be regarded as insignificant. In the current case, the specific operating environment, strategic imperatives and key performance challenges facing the national sporting organisations require examination to ensure that the most relevant dimensions of performance and associated goals and measures are selected for inclusion with the Balanced Scorecard. 2.2. The performance prism The model developed by Neely et al. (2002) attempts to distinguish itself from other similar models, such as the Balanced Scorecard, by offering a unique perspective on a measuring system that can ultimately be adopted as a way of operating within an industry, rather than just as a performance measure. The Balanced Scorecard (Kaplan & Norton, 1992) only outlines four different aspects of an organisation to be measured: finance; customers; internal processes; and innovation and learning. As a result, Neely et al. (2002) suggest it ignores the crucial role that the various stakeholders of an organisation have in determining the success or failure of its strategic objectives. Other models such as the Business Excellence model (EFQM, 2005) combine outcomes that can be easily measured with business enablers. Similarly, models such as Shareholder Value Frameworks (Srivastava, Shervani, & Fahey, 1998) incorporate the overall cost of capital into their models but still fail to acknowledge performance issues relating to stakeholders. In addition, Kaplan and Bruns’ (1987) model relating to ‘activity based costing’ and Feigenbaum’s (1991) ‘cost of quality’ model focus on aspects that do not necessarily add value to the organisation. The major limitation of these models is that they do not analyse the importance of stakeholders in relation to performance – a performance dimension that appears to be of significant importance for non-profit sport organisations. The designers of this model use the word ‘Prism’ in its title to establish a connection between performance management and the fact that a prism is a device that refracts light. A prism can reveal the ‘‘hidden elements behind something as apparently simple as white light’’ (Neely et al., 2002, p. 4). It illustrates the hidden complexities behind the issues of performance management that can affect an organisation. The authors argue that previous performance management models have failed to address all areas of performance within an organisation. They further argue that while each of these frameworks has provided a unique perspective on performance, they do not analyse organisational performance as an entire entity. In contrast, they suggest that the Performance Prism attempts to establish five different fundamental questions for management to draw upon in order to assess the true scope of the organisation’s performance management issues: 1. 2. 3. 4. 5.
Stakeholder Satisfaction: What are the wants and needs of our stakeholders? Stakeholder Contribution: What can our stakeholders provide to us? Strategies: Which strategies are best to implement in order to satisfy stakeholder demands? Processes: Which processes should be adopted to satisfy stakeholder demands? Capabilities: What practices, people, technology and infrastructure is required so processes and strategies can be fully implemented?
2.3. Sport NZ: Organisational Development Tool The Organisational Development Tool (ODT) is a software application unique to Sport NZ which was developed based on Malcolm Baldrige’s (2005) performance management criteria. This tool is a comprehensive ‘‘one-off application’’ as opposed to an on-going performance management process to measure overall organisational effectiveness. The ODT analyses areas as diverse as culture, values, strategy, finances and human resources. Specifically, the ODT examines various aspects of the organisation related to six different areas: leadership; planning; customer focus; sport delivery; people management; and sport management (Sport NZ, 2014). It is a self-assessment tool that has the ability to generate recommendations and can be applied to organisations as large as national sport organisations or as small as community based sport clubs. The ODT provides in depth analysis relating to a number of areas of organisational effectiveness but it is not without limitations. Performance dimensions such as individual employee performance are not assessed within its scope (O’Boyle, 2013; O’Boyle & Cummins, 2013) and, in line with other performance management frameworks, it requires substantial investment of both time and cost to conduct the review. Sport NZ uses the tool to assess the performance of various sport bodies within the New Zealand sport industry (Sport NZ, 2014). Although not a sufficient replacement for an on-going robust performance management process and perhaps lacking the inclusion of some performance dimensions, the creation of such a tool by Sport
I. O’Boyle / Sport Management Review 18 (2015) 308–316
313
NZ is a positive indication that non-profit sport organisations are beginning to understand the importance of combining the various facets of their operations to create a transparent, accountable and ultimately high performing organisation (O’Boyle & Hassan, 2013). 3. National Sport Organisation: Racquetball Australia Racquetball Australia is the national sport organisation responsible for governing and developing racquetball within Australia. The organisation is responsible for organising and managing all levels of the sport within Australia and for producing representatives for the Australian national team to compete at international events. The organisation has a high performance centre located in the Australian Capital Territory and runs various initiatives to promote and encourage the game at the grassroots level through its various affiliated bodies. Two years ago, the organisation launched a national development programme with the aim of getting more individuals involved in the sport and retaining those individuals who already participate through playing, coaching, officiating or volunteering. This initiative focussed on all levels and demographics within Australia and programmes were designed at both school and club levels in order to attract new participants from various age groups. Initiatives at the school level in particular were seen as being of major importance in order to establish an interest with young participants and encourage parents and teachers to become involved in coaching and volunteer roles, which indeed, may lay the foundations for further initiatives at high school and club levels. In addition, the organisation implemented a player and coach pathways system at the same time in order to provide clear direction and opportunities for aspiring players and coaches within the sport. Racquetball Australia has invested heavily in the development of the sport throughout Australia and the ability to do this has come from a diverse income mix consisting of government funding, commercial sponsorship, member levies and philanthropic grants. When the organisation hosts an international test match it must absorb all expenses of the event including the expenses of the touring team. Commercial sponsorship in particular has been an important revenue stream for the organisation and it wishes to place a large emphasis on ensuring that sponsors are satisfied with their return on investment and their relationship with Racquetball Australia in order to secure long term deals moving forward. 3.1. The strategic plan Racquetball Australia’s strategic plan, entitled ‘‘Strive for Greatness,’’ was designed in order to facilitate the growth and success of the game at the domestic level and at major international events. The plan has a focus on advancing the sport through higher levels of on-court performance including improving results of national team players, while also focusing on the development of off-court performance through increasing revenue streams, organisational performance, and improving governance structures within the sport as a whole in Australia. The vision and objectives for the organisation require success and improvement in all areas of the game from community through to elite levels. The four year strategic plan is broken down into annual operational plans with specific objectives to be achieved within that timeframe. The organisation developed the current strategic plan through a strategic framework of linking the vision of the organisation to its purpose; much like the principles behind the Balanced Scorecard (Kaplan & Norton, 1992). The key imperatives for Racquetball Australia are addressed in the following subsections. 3.1.1. Culture of Excellence Racquetball Australia wishes to establish a culture of excellence relating to playing performances and the internal performance of the organisation itself. The organisation acknowledges that if it is to achieve such a culture of excellence, it will require substantial improvements in all areas of on-court performance from the community level of the sport through to representative national teams. Racquetball Australia proposes to create such a culture through: reviewing lines of accountability and values; promoting behaviour that facilitates the implementation of a culture of excellence; working harder to improve communication with all stakeholders; creating a working environment where performance is robustly scrutinised; and attracting and retaining high calibre personnel within the organisation both at board and management levels. 3.1.2. National teams Racquetball Australia believes that, in order for the organisation to have the ability to stimulate growth, attract sponsorship and increase other revenue streams, the success of the men’s and women’s representative national teams is paramount. The high performance programme that operates within the organisation is strategically structured to facilitate the success of the national teams at international competitions. There are a number of issues that the organisation must focus on in order to foster this development of high performance at the international level. 3.1.3. Player and coach development Racquetball Australia wants to have structures in place that can identify suitable players who have the potential to compete at the elite level. Player development pathways and the appropriate services and facilities will be available to prospective elite players. A strategic alliance with the sport’s Players Association is required in order to keep lines of communication open between the two parties.
314
I. O’Boyle / Sport Management Review 18 (2015) 308–316
Likewise for coaches, it is important that identification and development systems are in place in order to grow the number of elite level coaches within Australia. Implementing a robust coaching review mechanism to establish accountability and provide coaches with the opportunity to identify areas of improvement is required. 3.1.4. Elite services The organisation wants to recruit and retain high calibre individuals capable of managing the needs of an elite level national team. The delivery of world class sport science services to players and coaches is also a crucial element of success in any contemporary national sport organisation. The organisation must also ensure that all equipment, playing and practice facilities are of a standard suitable to an elite level national team. 3.1.5. Stakeholders As a result of the implementation of an independent board (where there is no regional representation), it is essential that the organisation develops and improves clear lines of communication between the organisation and its various stakeholders. These stakeholders include members via regional associations, clubs, schools, sponsors and the general public. It is crucial that the goals and objectives of affiliated entities are aligned with the overall aims of the organisation as laid out in the strategic plan. These organisations are the catalyst for Racquetball Australia achieving or failing in its strategic direction. In order to successfully grow and develop the sport, the organisation must also ensure there are good lines of communication between a number of other entities such as supporters, the International Governing Body, the government agency for sport, and volunteers. 3.1.6. Sustainable growth In order to sustain an adequate level of growth in the game, Racquetball Australia will recruit new players, coaches, officials and volunteers, and focus on retention strategies of those individuals and groups who are already involved within the sport at various levels. In order to facilitate an effective recruitment and retention strategy, it is imperative for the organisation to understand the needs and expectations of the various groups involved. Increasing participation levels is a major area of concern and suitable structures to promote and attract new participants to the game should be in place, particularly at the ‘grass roots’ level. A particular demographic that the organisation must focus on is female participants as currently they are underrepresented within the sport. Finally, volunteers must not be undervalued at any level within the game and they should be provided with adequate training and resources to grow the game at the club and school level. 3.1.7. Commercial aspects of the sport Racquetball Australia wants to explore new revenue streams that can provide the organisation with the capability to achieve strategic goals. The management of existing commercial revenue streams such as sponsorship arrangements, member levies and government funding must be constantly evaluated and assessed to ensure stakeholder satisfaction and to provide security for financial health within the organisation. In order to attract additional revenue streams, particularly from commercial sponsors, it is important that the organisation generates a public image that upholds and promotes the values of sport, acts as a transparent entity, communicates effectively with stakeholders and has the ability to deliver entertaining and successful sporting events. These activities should be underpinned by appropriate governance structures, high calibre management and board members, and ultimately, a robust performance management system. 4. Developing a performance management framework: views of the CEO This section describes the need for a performance management framework to be developed within Racquetball Australia. This is required in order to reflect the priorities of the Strategic Plan set out above and to help the organisation achieve these objectives. This section also includes the views of the (hypothetical) Chief Executive officer (CEO) of Racquetball Australia who was interviewed in relation to the development of a performance management framework within the sport. The establishment of an organisational wide performance management system is a practice that Racquetball Australia knows it must introduce to improve overall results and outputs and to increase organisational performance as a whole. At present, a formal performance management system does not exist within the organisation but the CEO believes the implementation of such a practice could provide real benefits in relation to managing performance objectives and its accountability function to government, sponsors, members and other stakeholders. As non-profit sport organisations become more professional in their approach, commentators believe the industry should move to a situation in which nonprofit sport organisations are appraised as commercial entities (Chappelet & Bayle, 2005). The CEO states that, ‘‘using sustainable systems and processes is critical and has to be led by a capable management team and supported by a skilled board.’’ The board of Racquetball Australia has been appointed following an independent national recruitment campaign to ensure that the organisation has high calibre individuals with business acumen running the organisation. However, an ongoing performance management practice has not yet been implemented. The CEO goes on to claim that it is, ‘‘important to have a formalised system as a number of departments have to be aligned and there is a strong accountability function to government, which invests heavily in the sport.’’ Currently, performance management within Racquetball Australia is
I. O’Boyle / Sport Management Review 18 (2015) 308–316
315
limited to a traffic light system of whether or not objectives have been achieved (green), ongoing (amber), or not achieved (red). The CEO claims that, ‘‘an organisation-wide performance management tool does not currently exist within the organisation.’’ He concedes that, ‘‘it is a crucial area for improvement.’’ He adds a possible reason as to why such a practice does not currently operate in the organisation: ‘‘performance management can be seen as a frustrating timewaster that takes people away from their main roles and responsibilities.’’ However, he goes on to add that, ‘‘it is the role of the board, CEO and senior management to stress the importance of such a practice and convey that performance management can ultimately help the organisation operate more effectively and achieve objectives far more efficiently than if there were no such practice in place.’’ Pulakos (2009) describes how some organisations find it difficult to fully engage with suitable performance management approaches and suggests an individualised system must be adopted to suit each organisation. A performance management system that is seen to be a timewaster by staff is clearly of little benefit to the organisation and such a system should be reevaluated to ensure it serves a real purpose for the organisation (Pulakos, 2009). It may take some time and ongoing adjustment to establish a system that truly meets the needs of an organisation, such as Racquetball Australia, that may have multiple objectives operating within variable timeframes. The CEO confirms this synopsis by stating that, ‘‘there is a wide range of size and capability within sport organisations; not one model suits all.’’ The modern non-profit sport organisation is a multi-faceted entity with often complex governance structures and various stakeholders who can make it difficult to implement an effective performance management approach (Pulakos, 2009; Yeh & Taylor, 2008). The CEO suggests that one of the major functions of the national sport organisation is to have the ability to measure its own performance but also to measure the performance of its partner organisations (state bodies and regional affiliates). He states that partner organisations are, ‘‘currently required to submit strategic plans and must report against those plans as a condition of funding; but more should be done to ensure a good return on investment of public finances.’’ While Racquetball Australia must convey to its own staff that the implementation of an appropriate performance management practice is not a time waster, it must do the same for its partner organisations and perhaps make this a condition of funding. However, as the CEO points out, ‘‘Racquetball Australia must not be seen as a bureaucracy, but instead, highly flexible and relevant to the affiliated bodies.’’ The overall success of Racquetball Australia’s objectives is largely dependent on the capability and willingness of its partner organisations to align their resources and strategic direction with those of the organisation. Alarmingly, the CEO makes the statement: ‘‘ultimately our partner organisations will create direction for themselves. Hopefully, it is in line with our direction.’’ Ideally, this would not be the case within the sport, and partner organisations would be held more accountable for the funding they receive and a common robust performance management process would be implemented within racquetball to ensure key alignment of objectives, resources and efforts across the entire sport. This situation would also address the prevalent issue of Racquetball Australia’s inability to obtain reliable information (data) relating to various programmes and initiatives from its partner organisations as described by the CEO. 5. Summary The CEO suggests that, ‘‘commercial organisations with a product to sell put a large emphasis on performance reporting and data analysis; it is time for sport organisations to do the same.’’ He believes that in order to do this, the organisation must communicate expectations in a clear, accurate and transparent manner as, ‘‘improving partner organisations’ respective ability to perform is crucial.’’ He acknowledges that, ‘‘the sector is not good at monitoring and evaluating performance,’’ but claims that the organisation will invest heavily in this area and the impending implementation of, ‘‘robust performance management practices will provide better investment.’’ He summarises by stating: ‘‘the closer our sport gets to adopting commercial and professional approaches to performance management, the more effective and efficient we will become.’’ References Bayle, E., & Robinson, L. (2007b). A framework for understanding the performance of national governing bodies of sport. European Sport Management Quarterly, 7, 240–268. Bourne, M., Franco, M., & Wilkes, J. (2003). Corporate performance management. Measuring Business Excellence, 7(3), 15–21. Chappelet, J., & Bayle, E. (2005). Strategic and performance management of Olympic sport organisations. Champaign: Human Kinetics. European Foundation for Quality Management (2005). The EFQM framework for knowledge management. European Foundation for Quality Management. Brussels: Author. Feigenbaum, A. V. (1991). Total quality control (3rd ed.). New York: McGraw-Hill. Kaplan, R. S., & Bruns, W. (1987). Accounting and management: A field study perspective. Boston: Harvard Business School Press, Print. Kaplan, R. S., & Norton, D. P. (1992, January). The balanced scorecard: Measures that drive performance. Harvard Business Review, 71–80. Kaplan, R. S., & Norton, D. P. (1993, September). Putting the balanced scorecard to work. Harvard Business Review, 2–16. Kurtzman, J. (1997, February). Is your company off course? Now you can find out why. Fortune, 128–130. Malcolm Baldrige National Quality Award (2005). Criteria for performance excellence. Gaithersburg, USA: National Institute of Standards and Technology. Neely, A. (2005). The evolution of performance measurement research: Developments in the last decade and a research agenda for the next. International Journal of Operations & Production Management, 25(12), 1264–1277. Neely, A., Adams, C., & Kennerley, M. (2002). The performance prism. Financial Times. Prentice Hall. O’Boyle, I. (2012b). Performance management in sport. In S. Leberman, C. Collins, & L. Trenberth (Eds.), Sport business management in New Zealand and Australia (pp. 363–377). Melbourne: Cengage Learning. O’Boyle, I. (2013). Individual performance management: A review of current practices. Asia-Pacific Management and Business Application, 2(1), 1–22.
316
I. O’Boyle / Sport Management Review 18 (2015) 308–316
O’Boyle, I., & Cummins, P. (2013). Examining theories of individual performance management. Training & Management Development Methods, 27(5), 3.69–3.78. O’Boyle, I., & Hassan, D. (2013). Organizational performance management: Examining the practical utility of the performance prism. The Organizational Development Journal, 31(3), 51–58. Pulakos, E. D. (2009). Performance management: A new approach for driving business results. Chichester, West Sussex, UK: Wiley-Blackwell, Print. Sport NZ (2014b). Organisational development tool. Retrieved from: http://www.sportnz.org.nz/en-nz/our-partners/Developing-Capabilities/OrganisationalDevelopment-Tool/ Srivastava, R. K., Shervani, T. A., & Fahey, L. (1998). Market-based assets and shareholder value: A framework for analysis. Journal of Marketing, 62, 2–18. Yeh, C., & Taylor, T. L. (2008). Issues of governance in sport organisations: A question of board size, structure and roles. World Leisure Journal, 50(1), 33–45.