May 2007

Inside this issue:

• Welcome to Performance Matters
• Professional Managers Run the "Best Cities to Live"
• Using Performance Measurement: Coral Springs, Florida

Welcome to Performance Matters 

In today's accountability-driven environment, performance management is more important than ever. In good times or challenging ones, an effective system of performance management is an essential decision-making tool for any organization.

For this reason, I'm pleased to present you with this inaugural issue of Performance Matters , a new monthly e-newsletter from ICMA that shares the best from research and the real world to help you measure—and manage—your organization's performance better every day. Inside you'll see:

• How Fort Collins, Colorado, ascended to the top of Money magazine's "Best Places to Live" list—measuring and managing performance all the way
• Coral Springs, Florida's bid for the prestigious Baldrige Award—using data collected through ICMA's Center for Performance Measurement (among other sources)
• Ways that you can incorporate—or better utilize—performance measurement in your organization's management plan.

I hope you find Performance Matters useful. We'd love to hear what you think-and feature what you're doing, exploring, researching in the field of performance management. Share your comments and story ideas with the editorial team at khasbargen@icma.org .

Sincerely,

Robert J. O'Neill, Jr.
Executive Director, ICMA

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Professional Managers at the Helm of Money Magazine's Best Cities to Live

In August 2006, Money magazine presented its annual lists of the Best Cities to Live.

Of the ninety small cities listed, 64 are run by professional local government managers and administrators. Among the top ten big cities, seven employ professional managers or administrators. Professional local government managers and administrators are senior-level executives appointed by a community's governing body to oversee and ensure the smooth and efficient day-to-day operations of their local government.

Is it a coincidence that 70 percent of Money's best large communities and more than 70 percent of the best small communities employ professional managers? ICMA's executive director, Bob O'Neill, doesn't think so:

"All our research and experience suggests that one of the clearest predictors of success and performance in state and local government is the quality of individuals who work in those organizations, and that professional leaders and managers matter."

The Money article seems to back up this assertion.

Another interesting commonality among the communities at the top of Money's lists is that, in addition to being professionally managed, a significant number also participate in ICMA's Center for Performance Measurement-a unit within ICMA that assists local governments with measuring and improving the delivery of municipal services. Could it be that purposefully monitoring of service-delivery performance also contributes to livability?

#1 small city: Fort Collins, Colorado

Money magazine listed Fort collins as the #1 small city to live in. 

Beginning with the 2006-07 city budget cycle, the city of Fort Collins adopted the "Budgeting for Outcomes" (BFO) process for developing its biennial budget.  At the core, BFO is about identifying the results that citizens want and need, and then strategically allocating city funds to achieve those results. 

As part of the BFO process, city staff developed a long list of performance measurements to use in assessing annual progress toward clearly established goals.  The purpose of collecting the data is to monitor the effectiveness of city programs in achieving the results and to close the feedback loop.  Instead of continuing to fund existing programs from year to year without examining their effectiveness, departments are pushed to demonstrate their success in achieving goals before they can renew their programs.  If a program can demonstrate success, its funding can be better ensured.  If programs cannot show measurable success, the city works to identify better, more cost effective ways to provide citizens what they need from the municipal government.

Many departments have been successful in implementing performance measurement programs.  The city's water utility manages its daily operations based on data it collects on water quality, efficiency, and service delivery.  Water production manager Kevin Gertig recently told the city's executive leadership team that his personal motto is, "In God we trust. Everyone else bring data."  He is a leader in their organization for identifying meaningful data that truly describes the effectiveness of their programs and the quality of their product.

As the city begins its second round of BFO, departments will be asked to examine their success in providing results, and to demonstrate their performance with the data that they have been collecting over the past 18 months.  The city manager can then evaluate which programs to recommend continuing to fund in the coming budget years, which may need additional funding to achieve the desired results and if unsuccessful programs may be considered for reductions or other changes.

In 2007, the city also agreed to participate in the ICMA Center for Performance Measurement's Colorado Consortium.  As an additional dimension to their overall performance measurement program, city manager Darin Atteberry looks forward to having data available for comparing the effectiveness of city programs with those of other neighboring communities. 

"Though it's important to know how we're doing this year compared to last year, it's also important to our citizens to know how we're doing compared to other cities along the Front Range [of Colorado]," says Atteberry. "Are they getting a good value for their tax dollars?  Or are we just 'gold plated' as some have suggested?  I don't believe we're 'gold plated,' and we need to be able to prove it.  I also want to demonstrate to our citizens the cost of quality-earning a place as Money Magazine's 'Number One Place to Live' doesn't happen without investing in the results citizen want."

#1 big city: Colorado Springs, Colorado

Money magazine listed Colorado Springs, Colo. as the #1 big city to live in.   

Colorado Springs has employed a professional manager since 1920 and has participated in ICMA's Center for Performance Measurement since 1998.  Colorado Springs officials say that participating in the Center for Performance Measurement allows them to "compare their performance with that of other entities of similar size or characteristics and gives them the information needed to benchmark their performance against those jurisdictions to determine if there are steps they can take to improve the efficiency or quality of the of the services provided." 

Performance measures are well integrated into Colorado Springs' strategic plan and are used to track the city's progress toward achieving each of the plan's objectives.  Through the use of performance measure data, the city council is able to assess empirically the return on investment into a service.  City manager Lorne Kramer asserts that the "use of performance measures in our guiding document, the Strategic Action Plan, has been invaluable in achieving our city's vision of being the community of choice for living, working and leisure.  Measuring our city's performance gives us the information to provide more effective and efficient municipal services as well as improve accountability and trust in government."

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Using Performance Measurement: Coral Springs, Florida and the Baldrige National Quality Award

Jurisdiction: Coral Springs, Fla.

Population: 132,722

Square Miles: 24

Form of government: Council-manager

Indicator: The Baldrige National Quality Award

Established in the 1980's, the Baldrige National Quality Program seeks to "enhance the competitiveness, quality, and productivity of U.S. organizations for the benefit of all residents" through application of its rigorous "Criteria for Performance Excellence." The program also invites organizations using the criteria to apply for the annual Malcolm Baldrige National Quality Awards that recognize service delivery and business process excellence in several sectors. Details about the criteria and award process can be found at quality.nist.gov .

Previously open only to business, healthcare, and education organizations, in 2006, Baldrige initiated a pilot program under which governments and nonprofit organizations were invited to apply for performance feedback, but not actual awards. The city of Coral Springs elected to participate in this pilot and used Center for Performance Measurement data as evidence of high service delivery performance in its application.

In 2007, local governments will be permitted to apply for full award recognition from Baldrige, and Coral Springs plans pursue that opportunity, again using CPM data to support its application.

In addition to gathering evidence for Baldrige, Coral Springs also looks at its own trend data regularly and compares its performance to other CPM jurisdictions. If the analysis reveals another jurisdiction that is performing better than Coral Springs on a particular indicator, city staff will contact that other jurisdiction and ask about the specific metric and how the high performance was achieved. Coral Springs finds that this research provides some of the best pay-off from its CPM participation.

Does your jurisdiction have a similar example of how performance measurement has helped achieve recognition, answer a question, or find a new way of doing business in your local government? Please contact Kira Hasbargen at khasbargen@icma.org or 202-962-3606.

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