Implementing a component approach to productivity measurement in a large public service organisation

Productivity measurement efforts in the public sector are complicated by two fundamental issues: 1) the role of qualitative factors in service provision; 2) the underdevelopment of measurement culture. This paper describes and implements a new approach for measuring productivity of large public service organisations. The qualitative multiple case study utilises data obtained through interviews and action research studies. It presents the main experiences from a large and intense research and development project carried out in the City of Helsinki, Finland during 2007 to 2010. The contribution of the paper relates to two issues. First, it presents a new measurement approach. The main idea is to first develop appropriate component measures for the operative level, after which the results can be aggregated for the purposes of decision-making at upper organisational levels. Second, the study illustrates factors that facilitated the success of implementing a new measurement and management control system.