Literature Review on Performance Management Based on Malcolm

Baldrige National Quality Award

Jonathan Pratama 29116346

MM6024 Corporate Performance Management

Master of Business Administration

School of Business and Management, Institut Teknologi Bandung, Bandung

jonathan.pratama@sbm-itb.ac.id

Abstract – This paper studies different paper about Malcolm Baldrige National
Quality Award. There are different situation of MBNQA usage in performance
management. The studies was conducted in form of literature review. There are
public sector, education, business, and spiritual leadership as the object of study.

Keywords: Malcolm Baldrige, performance management, literature review, study.

1. Introduction

Malcolm Baldrige National Quality Award (MBNQA) is an award that was

established in 1987 to promote quality awareness, understand the requirements for
quality excellence, and share information about successful quality strategies and its
benefit. MBNQA is useful to become reference point for performance management
in a certain organization. The MBNQA score will determined the performance of
organization compared to its peers. MBNQA can help organization to improve
overall effectiveness, capabilities, and result. If organization can improve their
effectiveness, then it can deliver more values to its customers. The MBNQA result
can also be useful to facilitate communication and sharing best practice information
between organization, since they shares the same format. MBNQA can become a
base when developing strategies for organization. There are seven Baldrige
perspectives:

 For business:
1. Leadership
2. Strategic Planning
3. Customer and Market Focus
4. Measurement, Analysis, and Knowledge Management
5. Human Resource Focus
6. Process Management
7. Business Results
 For education:
1. Leadership
2. Strategic Planning
 3. Student, Stakeholder, and Market Focus
4. Measurement, Analysis, and Knowledge Management
5. Faculty and Staff Focus
6. Process Management
7. Organizational Performance Results
 For health care:
1. Leadership
2. Strategic Planning
3. Focus on Patients, Other Customers, and Markets
4. Measurement, Analysis, and Knowledge Management
5. Staff Focus
6. Process Management
7. Organizational Performance Results

2. Method of Comparison

The purpose of this study is to compare the implementation of Malcolm Baldrige

National Quality Award (MBNQA) in performance management for different type
of organization. All the comparison on this study was based on literature review
from five different papers.

2.1 The Aspect of Performance Measurement in Public Aspect

The measurement in public organization is a very relevant issue. Public sector

organization different from business organization. Business organization main goal
is to gain profit, which is different from public sector organization that is non-profit
making. The main goal for public organization is to satisfy public needs. Public
sector organization must be able to use the available resource effectively and
efficiently. Public sector has public goods, which are not under competition. Public
sector are also managing and using State resources, so they are responsible to public
interest when using the resources. Performance in public sector is related to the
political decisions by the government. It is deeply related to public satisfaction on
the administrative.

There are five functions characteristic to the organization in public sector. Which
consists of distribution, regulation, redistribution, creation of institutions, and
provision of public services[1]. Function of distribution means the distribution of
budget from tax payers into public goods. The function of regulation is to maintain
order in public. It also can helps to solve market’s problem such as, distribution of
goods, monopoly. Then the function of redistribution means provision of goods to
the society, such as social needs, educational, health, security, and cultural which
funded by public sector. Creation of institutions can be in form of establishment in
new institutions or reorganization of current institutions to provide better public
services. Last is provision of public services, this covers the provision of goods to the
society.

All functions of public sector organization are related to one another and oriented to
satisfy public needs. Therefore it depends on the capacity of public sector
organization to plan, organize, and make decision effectively. Not only that, public
sector organization also need to be able to implement the decision that they made
that can provide satisfaction to public. The satisfaction of public needs become the
index of performance from public sector organization. So the relation between
provider and users of public services become the measurement of performance.

2.2 Performance Measurement Using Malcolm Baldrige Education Criteria for

Performance Excellence 2013-2014 on Industrial Engineering of President
University

President University located in Cikarang and has 14 study programs. They have
concerns to do continuous improvement. The institution using self-evaluation
method through performance measurement using Malcolm Baldrige Education
Criteria for Performance Excellence (MBECfPE). Performance measurement is
important to evaluate, control, focus, motivate, promote, implement, learning, and
improve overall performance[2]. Result of the measurement is utilized to give
feedback to performance achievement and strategic planning.

Malcolm Baldrige Education for Performance Excellence has been used by at least
100 organization across the world. MBECfPE capture current situation in an
organization by using seven criteria: leadership, strategic planning, customer focus,
measurement, analysis and knowledge management, human resource focus,
operation focus, and results. Advantage of MBECfPE is that the result can be used to
best practice sharing, and the award winner become the model organization that can
be benchmarked by other organizations.

Weakness of this MBECfPE is that this system is too focused on result and not give
much attention to the techniques and capabilities. This is why Balance Score Card is
more advantageous for this part, where it will be more consistent across different
division and give more attention to the strategy implementation in every part of the
organization. For shareholder, Balance Score Card can give more information on
how the organization performance as a whole is doing compared to MBECfPE.

2.3 Strategies to Implement the Baldrige Criteria for Performance Excellence

The purpose of this case study in this paper was to explore strategies that executive
business leaders use after adopted the Baldrige Performance Excellence Program.
Organization use various ways of performance management systems to create
sustainability of the organization. One of the model is Malcolm Baldrige National
Quality Award (MBNQA). The result of this MBNQA was Baldrige Criteria for
Performance Excellence to enhance organizational performance. Identification of
appropriate implementation of strategy based on this criteria could enable future
increase of successful organization that follow this criteria.

Business leaders must continue to improve the performance of their business to

remain relevant and competitive in market. One of the main components of high-
performance work system is reward and punishment. This performance
management system create connection between organization’s vision, mission, goals,
and objectives to its target community. Performance management system serve as
the foundation for the organization to exist. Commitment of all employee to the
objectives and participation as a team member are essential to organization
performance[3].

One of the aspect of performance excellence models is focus on continuous process

improvement and provide value[3]. There is a need of alignment in the management
to stimulate the coordination, knowledge sharing, and productivity to increase
performance of the organization. Another aspect is continuous improvement that
includes incremental change to improve process, product, and service. The success
of a project depends on the quality of its process that been utilized in the project
plan. Human resource also plays an important part in the overall success of
performance management. Harnessing and aligning the human capital to the vision,
,mission, goals, and objectives of organization is necessary for a firm to be successful.

Goal alignment allows employees to understand their role in the organization

strategy, and promotes the activities that needed for the strategy to be successful.
Leaders also can choose different approach of leadership that depends on differing
employees and work-related needs [3]. The interconnections between organizational
alignment and employee engagement are important to make sure the strategy can be
implemented successfully and effectively.

2.4 Malcolm Baldrige National Quality Award (MBNQA) Dimensions in Greek

Tertiary Education System

Malcolm Baldrige National Quality Award Model are widely used as channels of
Total Quality Management (TQM)[4]. MBNQA has evolved from just recognizing
and promoting performance management practices into comprehensive framework
model used for improvements and benchmarking. Malcolm Baldrige Award
promotes the belief of quality improvement increase competitiveness, understanding
the need for excellence, and quality of products or services are depending on the
implementation of quality strategies. MBNQA is used in the primary, secondary,
and tertiary education in Greece. This highlighting the dimensions quality assurance
of the Greek tertiary educational system.

Pre-service teachers from ASPETE (School of Pedagogical and Technological

Education), Thessaloniki, Greece, are analyzed using MBNQA criteria. 123 pre-
service teachers participated in the study. The strong point and weakness situation
in result was able to be analyzed. The result will be a learning process to become
basis of continuous improvement and provide suitable framework for quality
management.

2.5 Spiritual Leadership as a Model for Performance Excellence: a Study of

Baldrige Award Recipients

Issues regarding workplace spirituality and spiritual leadership has become

attention of organizational science[5]. The research was to test the relationship
between spiritual leadership model and key organizational outcomes in a sample of
Baldrige Performance Excellence Program recipients. Baldrige Performance
Excellence framework is an approach to organizational performance management
that results in delivery of value to the customers, improvement of organizational
effectiveness and capabilities, and organizational, personal learning, with leadership
as the primary driver of performance results.

Spiritual refers to the quest of feeling interconnectedness with all things in the
universe[5]. Spirituality is often viewed as personal, that can reside in groups and
organizations. Essential to spiritual leadership are creating vision where leaders and
followers experienced a calling that their lives have purpose and meaning, and
establishing an organizational culture based in values of altruistic love with sense of
membership, belonging, and feel appreciated. Altruistic love in spiritual leadership
is defined as a sense of harmony and appreciation of both self and others.

Individual leader characteristics that has purpose and meaning, humble and
confident, and integrity believes to have influence to extent the organization
supports to the inner life of its employees. Teamwork that aligned and consistently
reinforced with the behavior of leaders who valued their people often resulted in
organization culture that based in caring and support. Altruism toward colleagues
can improve unit productivity. So the research purposed was to measure the
correlation between spiritual leadership to the performance of the actual
organization in samples.

3. Findings and Conclusion

From the first paper, The Aspect of Performance Measurement in Public Sector
Organization, the result of the study was to analyze the possibility to apply the
complex combination of performance measurement method on the core decisions of
public sector organization. The MBNQA model is easy to be implanted to any
organization because it is simple. This model is mainly focuses on the customer
satisfaction, make it more suitable for public sector organization. But the MBNQA is
not enough for performance management. It needs BSC (Balance Score Card) to
better analyze the organization internal processes. MBNQA is focused in the
effectiveness and result of organization management not on the quality of goods and
services. So it can be tools to improve the overall organization’s performance but
cannot eliminate daily problems in internal process since it too focused on results.

From the second paper, Performance Measurement using Malcolm Baldrige

Education Criteria for Performance Excellence (MBECfPE) on Industrial Engineering
of President University, the result of the study is the score of MBECfPE on Industrial
Engineering study program. They scored 65.29% in leadership, 76.42% in strategic
planning, 74.43% in customer focus, 69.49% in measurement analysis and knowledge
management, workforce focus 70.92%, operation focus 67.58%, and finally results
57.28%. The lowest score was from senior leadership with score 59.93%. So the
priority of improvement should be on senior leadership in the industrial engineering
study program.

From the third paper, Strategies to Implement the Baldrige Criteria for Performance
Excellence, the result was to explore strategies that executive business leaders use to
implement the Baldrige Performance Excellence Program. Business leaders
embedded the Baldrige Criteria for performance excellence into the native work
models, process, and verbiage rather than undertook total organizational change.
This highlighting the incremental improvement in native system that focus on the
people. Business leaders used robust strategy deployment system with
accountability for action plans to spread the Baldrige Performance Excellence.
Business leader did not specifically create new strategic goals but they alignes the
natives goals to suit the business model of Baldrige Criteria for Performance
Excellence. This means that corporate strategy should not be changed dramatically
in short time, but should be improved incrementally to align the framework model.

From the fourth paper, Malcolm Baldrige National Quality Award Dimensions in
Greek Tertiary Education, MBNQA model actually strengthen the previous study
results in providing a suitable framework for quality management. The leadership
criterion is the most essential condition to achieve excellence. Effective leadership
forms educational excellence performances at university.

From the fifth paper, Spiritual Leadership as a Model for Performance Excellence: a
Study of Baldrige Award Recipients, the result was explaining about the relationship
between spiritual leadership and performance excellence. The study suggests that
spiritual leadership comprise the values, attitudes, and behaviors required to
motivate oneself and others that resulted in higher level of organizational
commitment, productivity, and life satisfaction. This elevating the importance of
spiritual leadership as model in leadership criteria in the Baldrige Performance
Excellence Model that need further research.

Conclusion

Paper Title Result

1 The Aspect of Performance MBNQA can be tools to improve the
 Measurement in PublicSector overall public organization’s
Organization performance but cannot eliminate
daily problems in internal process
since it too focused on results
2 Performance Measurement using The priority of improvement should
Malcolm Baldrige Education Criteria be on senior leadership in the
for Performance Excellence industrial engineering study
(MBECfPE) on Industrial program
Engineering of President University
3 Strategies to Implement the Baldrige Corporate strategy should not be
Criteria for Performance Excellence changed dramatically in short time,
but should be improved
incrementally to align the framework
model
4 Malcolm Baldrige National Quality Effective leadership forms
Award Dimensions in Greek educational excellence performances
Tertiary Education at university
5 Spiritual Leadership as a Model for The study suggests that spiritual
Performance Excellence: a Study of leadership comprise the values,
Baldrige Award Recipients attitudes, and behaviors required to
motivate oneself and others that
resulted in higher level of
organizational commitment,
productivity, and life satisfaction

4. Limitation and Future Research

There are limitations in the writing of this paper. There are some different
perspective that cannot be compared directly. The aspect of literature review also
have different type of study and different focus. So for future research it is better to
search more similar type of paper so it can be compared directly.

5. References
Ingrida Balaboinene, G. V. (2015). The Aspects of Performance Measurement in Public Sector
Organization. Procedia Social and Behavioral Sciences .

Remi Renita, A. L. (2016). Penilaian Kinerja Dengan Menggunakan Malcolm Baldrige Education
Criteria for Performance Excellence 2013-2014 pada Program Studi Teknik Industri President
University.

Nathan Allan Lawrence, M. S. (2017). Strategies to Implement the Baldrige Criteria for Performance
Excellence. Techmind Research.
Anastasiadis Lazaros, A. S. (2016). Malcolm Baldrige National Quality Award Dimensions in Greek
Tertiary Education System. Knowlege E.

Louis W. Fry, J. R. (2016). Spiritual Leadership as a Model for Performance Excellence: a Study of
Baldrige Award Recipients. Journal of Management, Spirituality, and Religion .