Performance Governance

Performance Governance is the process by which a governing body sets and measures outcomes using a suite of performance indicators furnished by a network of third party service providers.

What is Performance Governance?

Performance Governance is a process, led by a governing body charged with stewardship of a network of third-party service providers. The governing body’s main goal is to ensure optimal outcomes for its constituents from this network. It does this by achieving inclusive and responsive collaboration with these arms-length organizations, in highly accountable, transparent ways.

Governance of Complex Networks

A network of third parties may be populated by hundreds or thousands of organizations, and this population shifts constantly through additions, closures and mergers. Having access to their internal workings is neither available nor desirable, since such third parties operate with myriad management systems and levels of sophistication. The relationship between governing bodies and arms-length organizations is based on suasion rather than direct control.

Establishing Key Performance Indicators

Successful Performance Governance (PG) is grounded in the governing body leading the establishment of a suite of Key Performance Indicators (KPIs). KPI development depends upon many independent organizations within the network developing realistic indicators collaboratively and consensually. Third party organizations generate KPIs that measure how successfully they deliver their outcomes and furnish accountability to their governing body.

Performance Governance Evolves

The Performance Governance process blends these indicators with additional supporting data and qualitative information from participating organizations. A suite of indicators for Performance Governance typically evolves over time, because their values are continuously fed back to the governing body, used to optimize processes, then re-assessed, forming a feedback loop for continuous improvement of governance.