Indicators in Action : Development, Use and Consequences

Sammanfattning: The increased attention to performance measurements is evident in both private and public sector organizations and among both academics and practitioners. Although there is a strong belief in the possibilities of using measurements for managing organizations, both academics and practitioners have questioned measurements potential. This thesis takes part in debating the potentiality of performance measurements by attending to the development, use and consequences of non-financial indicators that are considered a specific form of performance measurements.When investigating the development of indicators, it became evident that several of the new indicators developed proved to be reformulations of non-financial measurements already used within the organizations before the development work. What had changed was primarily the meaning ascribed to the measurements. As a consequence of this ‘re-cycling’ of measurements, it is concluded that the meaning given to specific non-financial indicators change over time. The present investigation also reveals that three shifting rationales are informing the development of indicators. This finding contributes with insights into the construction of indicators and how the link between indicators and action are conceived and established in a development process.A main finding of the investigation concerns how indicators are used. In contrast to previous studies, the results show that indicators can have a negative impact on performance unless the indicators are used in a sophisticated way. Based on these results it is argued that it is insufficient to attend solely to if indicators are used, i.e. greater attention needs to be paid to the question of how they are used. The investigation also presents evidence suggesting that the often used adage “what gets measured gets managed” needs to be revised. It is argued that measuring is not a means to activate the organization per se. Rather, measurements support those issues that are already mobilized within the organization.In conclusion, this investigation suggests that the potentiality of indicators depends on the meaning ascribed to indicators, how indicators are assumed to link to action, how indicators are used and how indicators are related to other organizational activities.