Results-based management (RBM) is a model that primarily focuses on performance and the achievement of specific goals, rather than immediate savings in time and money. In this article, we explore the key concepts for successfully implementing this business model.

Brief history of results-based management

The concept of results-based management first emerged in 1964, with the publication of Peter Drucker's book, "Managing for Results". In this work, the author explains the notion of efficiency vs effectiveness and the importance of focusing on effectiveness to optimize business.

Efficiency is the ability to accomplish a task while wasting as little time and money as possible and minimizing effort and skills during its execution. Effectiveness is the level of success in producing a desired result.

For example, an efficiency metric could be the ratio between the total cost of maintenance and the cost of replacing a piece of equipment. The time dedicated to repairs in comparison with preventive maintenance, is an efficiency metric to reduce work interruptions and expenses related to emergency maintenance.

Results-based management is a management strategy or method used by an organization to ensure that its processes, products, and services contribute to the achievement of clearly defined results.

What does results-based management consist of?

A results-based management model revolves around decision-making based on clearly specified facts, data, and metrics. It integrates the following aspects:

  • Strategies
  • People
  • Means available (resources)
  • Processes and measurement tools to improve decision-making
  • Transparency
  • Accountability

This management system focuses on:

  • Achieving outcomes
  • Implementing performance metrics
  • Learning
  • Adapting
  • Reporting on results, including outcomes and performance

It is more than just a set of tools; it is a management approach and a way of working that looks beyond activities and outputs to focus on the actual results and outcomes of projects and programs.

The winning conditions for switching to a results-based management system

The most effective performance metric framework focuses on the outcomes of programs, rather than on inputs and activities, as is the case in traditional management. The implementation of this method requires long-term commitment. As a result, it needs to be planned meticulously.

In its summary of lessons learned from the implementation of results-based management in various international organizations, the Office of the Auditor General of Canada explains its findings in detail.

According to this document, the winning conditions for successful implementation observed on a global scale are as described below.

The organizational factors

Following is a summary of the main organizational factors mentioned in the report by the Office of the Auditor General of Canada.

  • The model must be personalized to correspond with the specific circumstances and needs of the stakeholders involved.
  • The implementation of a results-based management system is a long-term project that requires patience, perseverance, and ongoing commitment.
  • The system must be linked to the organization's strategic framework, particularly in terms of practices, objectives, business plans, and budgets.
  • The organization needs to provide the necessary financial and human resources, requiring commitment from the C-suite.
  • Its success requires harmonized management systems to support the systematic collection, recording, analysis, and communication of performance-related data.
  • Success hinges on the choice of project control center and performance metrics.
  • Carrying out pilot projects allows the system to be tested in order to detect and resolve problems before company-wide deployment.

The human factors

Like any major initiative, human factors are just as important as the above-mentioned factors in supporting implementation.

  • Success depends on creating a results-oriented performance management culture.
  • The vision and objectives of implementation must be clearly defined and communicated to the entire organization as well as to external partners. Employees need to know the purpose of performance metrics and their value. They need to understand their role in the new system and the place of performance data in the organization's decision-making process.
  • The organization should operationalize the concept of accountability for all stakeholders.
  • The project should be able to count on the leadership, participation, and engagement of the C-suite, particularly in terms of overcoming resistance to change.
  • Managers should foster a sense of ownership and promote commitment at all levels of the organization. Technology is used to improve processes, and not to replace relationships and human involvement.
  • Education and training are essential for the project to succeed.

The principle behind the results-based management model means first defining the objective or desired result, and then setting out the path to achieve this. Precise metrics and measurements are used to monitor progress toward success and to make any necessary adjustments along the way. If organized well, this system optimizes the organization's actual effectiveness and involves the collaboration of all stakeholders concerned.