A Review of the Role of Contractibility in Performance Measurement System (Case Study: Mashhad Municipality)

Introduction In the research we hypothesize that the way in which performance measurement systems are being used affects organizational performance, and that these performance effects depend on contractibility. The findings have important implications, both for practice and for public policy. Hypotheses research hypotheses developed as follows: H1. contractibility has a positive and significant effect on performance. H2. The incentive-oriented use of performance measurement systems has a significant effect on performance. H3. The contractibility has a significant effect on incentive-oriented use. H4. The exploratory use of performance measurement systems has a significant effect on performance. H5. The contractibility has a significant effect on the exploratory use of performance measurement systems. Methods To test the hypotheses, we using survey data from public sector organizations in the Mashhad Municipality. We sought to identify a model for investigating the relationships between the use of performance measurement systems. Consequently, the structural equations and AMOS software have been used. Results The results showed that contractibility does not affect on the organizational performance. also, we find that Contractibility does positive effect on the exploratory use and incentive performance of the performance measurement system. Conclusion The purpose of this research is to measurement the use of performance measurement systems and detection the type of use of the performance measurement system in public sector. Results recommends that organizations design a system that will provide the best feedback to continuously improve in organization.