An empirical study on performance management : A case study of national Iranian oil Production Distribution Company

Article history: Received March 22, 2012 Received in Revised form June, 15, 2012 Accepted 18 July 2012 Available online July 28 2012 The primary goal of creating a culture of performance management is to improve processes based on the responsibility of individuals and groups for the continuous improvement of business processes, and to contribute to their skills. In this paper, we discuss all related issues and indentify the most important aspects and components of performance management. The proposed study of this paper is to find out which performance management works best for national Iranian oil products distribution company (NIOPDC). The proposed study uses analytical hierarchy process to prioritize all important factors based on pair-wise comparison. We use geometric mean to find the average of comparisons and all computations are performed using Expert Choice software package. In summary, stakeholders (0.262) are the most important components of our survey followed by employee management (0.247), social responsibility (0.190) comes in the third position and quality of services (0.166) and internal process (0.134) are two less important factors in this survey. © 2012 Growing Science Ltd. All rights reserved.


Introduction
During the past few years, there have been tremendous efforts on having efficient methods for measuring and improving quality of organizations.Many of these methods focus on more than just financial figures and they have looked inside the organization by investigating different items such as people, processes, customers, etc. (Hooks & Farry, 2000;Westcott, 2005;Ueltschy et al., 2007).SERVQUAL has been considered as one of the most important one (Parasuraman et al., 1985(Parasuraman et al., , 1991)).According to SERVQUAL model, customers evaluate quality of service through five aspects including tangibles, reliability, responsibility, assurance, empathy.
The BSC breaks through the traditional limitations of finance, examining an organization's performance from the four main perspectives of finance, customer, internal business process, and learning and growth.It emphasizes both aspects of the financial and non-financial, long-term and short-term strategies, and emphasizes internal and external business measures (Kaplan & Norton, 1992, 1996a, 1996b).The EFQM excellence model is another technique, which is based on nine criteria where five of these are 'enablers' and four are 'results'.The Enabler criteria cover what an organization does while the results criteria cover organizational achievements (Hakes, 2007).Ueltschy et al. (2007) performed a comprehensive review on different methods reveal some of the common and uncommon features of these models described as follows, In this paper, we present an empirical study in a major producer in Iran by looking into all five perspectives including internal processes, customer satisfaction, stakeholders, service quality and social responsibility.The organization of this paper presents details of the proposed model as well as the necessary questions of the survey in section 2 and section 3 explains details of our results.The paper ends with concluding remarks to summarize the contribution of the paper.

The proposed model
The proposed study of this paper is to find out which performance management works best for national Iranian oil products distribution company (NIOPDC) and what would be the components of this proposed model.This could lead us to consider the following questions, 1.What are the dimensions of performance management and their priorities in the National Iranian Oil Products Distribution Company?
2. How performance management components and operational parameters are determined and evaluated?
3. What are the priorities of management performance indicators in the National Iranian Oil Products Distribution?
In this study, qualitative and quantitative approach are used.Explanatory model for the design and exploration of the interview as a qualitative method and the Delphi method as a quantitative method are used.The purpose of this descriptive study, in terms of cross-sectional and time of data collection method is a combination of qualitative and quantitative methods.In this study, two groups of internal and external experts for gathering the necessary data are used.The first step of judgment sampling was used to determine the panel members.Next, using a sampling chain and assigning an initial panel board, surveyed people were requested to choose panel members.Therefore, we have chosen two groups of expert people including 30 people from inside and 15 members from outside organization.In this survey, Delphi questionnaire was designed based on a conceptual model using exploratory interviews and reviews of the theoretical basis and then the resulted questionnaire was distributed among the experts.The members were requested about the questionnaire and the suitability of components and indicators obtained.Experts expressed their opinions on a Likert scale from 1 to 7 where 1 means the lowest suitability and 7 means the highest rate of suitability.The second round of Delphi questionnaire was redesigned based on the feedbacks received.In third round of Delphi survey, all attributes with relative rating of more than five were gathered and they were summarized in a separate questionnaire.The proposed study used analytical hierarchy process to prioritize all important factors based on pair-wise comparison.We have also used geometric mean to find the average of comparisons and all computations have been performed using Expert Choice software package.

The results
In this section, we present details of our survey on ranking for different criteria influencing management of this oil-based company including internal processes, stakeholders, employee management, service quality and social responsibility.

Internal process
Internal process is the first main component of our proposed study and it includes four sub criteria including organizational value creation, increase in customer satisfaction, improved operating performance and acting as a good citizen in terms of environment.To reach these components we have subdivided each category into more details categories and the results are presented in Table 1.

Table 1
Internal process components and their relative importance As we can observe from the results of Table 1, acting as a good citizen in terms of environmental issues (0.345) plays the most important role while organizational value creation plays the least important (0.198) role.

Stakeholders
Stakeholders is the second main component of our proposed study and it includes four sub criteria including Identifying and anticipating customer needs and expectations, Identifying and anticipating the needs and expectations of managers and employees, Identifying and anticipating the needs and expectations of government and identifying and anticipating the needs and expectations of society.To reach these components we have subdivided each category into more details categories and the results are presented in Table 2.Among components of stakeholders, identifying and anticipating customer needs and expectations (0.297) comes as the first priority followed by anticipating the needs and expectations of society (0.293).The other two attributes in this category, identifying and anticipating the needs and expectations of managers and employees (0.207) and identifying and anticipating the needs and expectations of government (0.207), maintain the same rates of importance.

Employee management
Employee management is the third main component of our proposed study.It includes four sub criteria including empowering employees, employee participation, employee satisfaction and employee motivation.To reach these components we have subdivided each category into more detailed categories and the results are presented in Table 3. Employee management has four components and in terms of their priorities employee satisfaction (0.333) and motivation (0.333) are equally more important than employee empowering (0.167) and participation (0.167).

Table 3
Employee management components and their relative importance

Quality of services
Quality of services is the fourth main component of our proposed study and it includes four sub criteria including tangibles, reliability, responsiveness, assurance and empathy.To reach these components we have subdivided each category into more details categories and the results are presented in Table 4.

Table 4
Quality of services components and their relative importance In terms of quality of services, assurance comes as the most important item, while tangibles (0.175) and empathy (0.198) represent the least important factors.

Social responsibility
Social responsibility is the last main component of our proposed study and it includes four sub criteria including enhance social conditions, customer service and community organizations, organizations involvement in solving social problems and allocation of resources to environmental protection.To reach these components we have subdivided each category into more details categories and the results are presented in Table 5.In terms of social responsibility, customer service and community organizations (0.290) maintains the most important impact followed by enhance social condition (0.246) and allocation of resources to environmental protection (0.246).

Discussion and conclusion
The main goal of creating a culture of performance management is to improve processes based on the responsibility of individuals and groups for the continuous improvement of business processes, and to contribute to their skills.In this paper, we have discussed all related issues and decided to indentify the most important aspects and components of performance management.
In summary, stakeholders (0.262) are the most important components of our survey followed by employee management (0.247), social responsibility (0.190) comes in the third position and quality of services (0.166) and internal process (0.134) are two less important factors in this survey.Among components of stakeholders, identifying and anticipating customer needs and expectations (0.297) comes as the first priority followed by anticipating the needs and expectations of society (0.293).The other two attributes in this category, identifying and anticipating the needs and expectations of managers and employees (0.207) and identifying and anticipating the needs and expectations of government (0.207), maintain the same rates of importance.Employee management has four components and in terms of their priorities employee satisfaction (0.333) and motivation (0.333) are equally more important than employee empowering (0.167) and participation (0.167).In terms of quality of services, assurance comes as the most important item, while tangibles (0.175) and empathy (0.198) represent the least important factors.In terms of internal processes, As we can observe from the results of Table 1, acting as a good citizen in terms of environmental issues (0.345) plays the most important role while organizational value creation plays the least important (0.198) role.In terms of social responsibility, customer service and community organizations (0.290) maintains the most important impact followed by enhance social condition (0.246) and allocation of resources to environmental protection (0.246).

Table 2
Stakeholders components and their relative importance

Table 5
Social responsibility components and their relative importance