1.

1 Summary of the Journal

Performance measurement in the public sector organizations aims at ensuring three primary
functions, accountability, allocation, and learning. According to Baird (1998); Hatry, (1999)
performance measurement assists manager to evaluate the performance of individuals, activities,
projects, and sectors and hence helped to make people and organization accountable for their
performance. In addition, performance measurement is also helpful not only in the budget
process and efficient allocation of public sectors’ resources to those activities which contribute
most to the accomplishment of strategic objectives but also in bringing early signal of the areas
that need adjustment and improvement, thus allowing people to learn from their success and
failure (Baird 1998). Through performance evaluation, people reduce arbitrary judgment and
scrutinize performance that helped to improve the quality and reduce cost of government
activities performed (Hatry, 1999).
As part of its wider public sector modernization and reform agenda, in 1999, the Tanzanian
government introduced strategies such as Performance Management System (PMS) to public
sectors including government’s institutions for planning, implementation, monitoring, and
evaluation and reporting in the public services of Tanzania. The system aimed to provide quality
public service to the public, improve performance of public service institutions, improve
accountability and responsiveness, ensure effective and efficient use of public resources and
provide standards for providing comparisons and benchmarking within the public service
institutions in Tanzania as well as other public service institutions across the world for
continuous improvement. This has now resulted in a statutory duty of continuous performance
improvement that has been placed on local authorities.
The ideas of Performance Management System (PMS) also strongly influence the activities of
local governments as well as central governments (URT, 2004). In particular, financial constraint
in local government requires continuous efforts for improving performance in producing public
services and managing local government (Worthington and Dollery 2002). One of the most
meaningful PMS movements or efforts for improving government performance is performance
measurement. Difference approaches have been used to measure the performance but the uses of
its information is questionable.

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 Assessment of uses of Performance Measurement Information in the Tanzanian Public
Sector
A Case of National Housing Corporation
1.2 Statement of Problem

Performance measurement techniques have become integral part of the tools that are useful in
managing public sector. The use of performance measurement systems is frequently
recommended for facilitating strategy implementation and enhancing organizational performance
(Davis and Albright, 2004). Today, performance measurement comprises the use of financial as
well as non-financial performance measures that are linked to the organization‘s performance
strategy. It has been argued that performance measurement can help organizations to promote
transparency, provide a means of rewarding performance, and promote learning between and
within organizations. Tanzania has undertaken many NPM-inspired reforms and indeed
performance management constitutes the core of Tanzania‘s public service reform programme
(PSRP). The PSRP has been implemented in Tanzania in order to improve public service
delivery and policy management.
Indeed, every public organization is required to introduce performance management system
(PMS) so as to improve the efficiency and effectiveness of its service delivery and to ensure that
value for money is achieve. Most public organization in Tanzania are now struggling to
introduce new management reforms that would enable them to focus on achieving specific
performance results with possibly limited resources . The national housing corporation is among
the many public organizations that are implementing new performance management approach
that include performance measurement and it would be of great interest to see whether this
policy reform has been effectively implemented. It is important to recognize that in both public
and private sector, measuring organizational performance has been a complex exercise that
demands both resources and organizational commitment. It is thus important to explore and
understand to what extent NHC has gone beyond policy rhetoric by implementing performance
measurement agenda as part of its performance management reform.

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Our aim is to contribute to our understanding of how performance measurement approach works
in practice in Tanzania.
1.3 Research Objectives
i. To examine the existence of Performance measurement methods at NHC
ii. To determine the uses of performance measures information in practice of NHC
iii. To assess the challenges facing performance measurement methods used at NHC
1.4 Research Questions
i. Is there a performance measurement system at NHC?
ii. How performance measurement information is used in practice at NHC and by whom and
for what purpose?
iii. What are the challenges facing performance measurement methods used at NHC?

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 CHAPTER TWO
LITERATURE REVIEW
2.1 Introduction
This chapter investigates the existing literature, focusing on theoretical and empirical review of
performance measurement. Publications in the literature reviewed so far have taken an interest in
the performance of concepts such as the methods of Performance Measurement and Rationale for
measurement of Performance
2.2 Theoretical review
Salaman says there are two theories underlying the concept of performance management: The
goal setting theory and Expectancy theory
The Goal Setting Theory
Goal setting theory had been proposed by Edwin Locke in the year 1968. This theory suggests
that the individual goals established by an employee play an important role in motivating him for
superior performance. This is because the employees keep following their goals. If these goals
are not achieved, they either improve their performance or modify the goals and make them more
realistic. In case the performance improves it will result in achievement of the performance
management system aims (Salaman et al, 2005).
Expectancy theory
Expectancy theory had been proposed by Victor Vroom in 1964. This theory is based on the
hypothesis that individuals adjust their behavior in the organization on the basis of anticipated
satisfaction of valued goals set by them. The individuals modify their behavior in such a way
which is most likely to lead them to attain these goals. This theory underlies the concept of

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performance management as it is believed that performance is influenced by the expectations
concerning future events (Salaman et al, 2005).
2.2 Empirical Review

The previous extant review of literature revealed that much of the research that has been
developed on performance within a public sector context has tended to concentrate on
developing organisational models of performance (Downs and Larkey, 20066; Carter, et al.,
2002). However, little work has focused on developing individual models of performance,
particularly in the complexity of the public sector. Although most human resource management
scholars (Bretz, et al., 1992; Latham and Wexley, 1993; Latham, et al., 1993; Randell, 1994;
Bernardin, et al., 1995) and other organisational researchers (Waldman, 1994; Cardy, 1998;
Wilkinson, et al., 1998; Longenecker and Fink, 1999;
Koopmans et. al, 2013) have advocated that employee performance is a key mechanism in
achieving organisational effectiveness, there are hardly any meta-analysis studies that link
determinants of the appraisal system to satisfaction with employee performance.
Thus, the longstanding problem in measuring individual employee performance continues. The
changing trends and nature of work, the work environment and sectors, the different types of
performance evaluation measures, the format of rating scales and the use of performance
information are just some of the key main challenges in performance management that need to
be addressed. Whether individual performance is viewed as a dependent or independent variable,
this issue needs extensive study because individual performance is important for organisational
goal attainment and productivity.
Definition of Key Terms
Performance
Brumback (1988, p.387) who pointed out that:-
“Performance means both behaviours and results. Behaviours emanate from the performer and
transform performance from abstraction to action. Not just the instruments for results, behaviours
and also outcomes in their own right the product of mental and physical effort applied to tasks –
and can be judged apart from results”
Performance Management

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According to Bititci, Carrie & McDevitt, (2007) define performance management as a “process
by which the company manages its performance in line with its corporate and functional
strategies and objectives”.
Performance Measurement
A performance measure is defined by Neely et al. (2005) as: “a metric used to quantify the
efficiency and/or effectiveness of an action”.

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