ABSTRACT
Apart from beneficial effects, performance measurement also has perverse effects. The chances are that the perverse effects will force out the beneficial effects in the long term. If performance measurement perverts in the long term, the inevitable question is whether and how performance measurement can be designed without these perverse effects occurring to an excessive degree. In this chapter I shall first answer this question. I shall indicate what criteria a system of performance measurement must, in my view, satisfy. These criteria are described in Section 2 and may be helpful in designing a system of performance measurement; this is why I shall refer to them as ‘design principles’ in the rest of this book. In Section 3, I will enter further into the difference between products and processes, which is vitally important for lively performance measurement. In Section 4, I shall indicate that process measurement, like product measurement, may produce perverse effects. I shall conclude in Section 5 with a linguistic digression about ideograms.
