Enhancing the governance of local areas through Dynamic Performance Management

This doctoral dissertation applies the findings of explanatory studies in the field of Dynamic performance management (DPM) to the public sector. Purpose. This work aims to show how DPM may support decision-makers in outlining sustainable policies for local areas. The study investigates local areas as meta-organizations. Design. The research takes a relativist perspective and investigates social phenomena through a deductive-inductive approach where qualitative research strategies assume a descriptive account in accordance with management science and System Dynamics (SD) tradition. The systematic review of the evolution of management models of public sector organizations sets the ground for arguing the need of DPM to implement public governance in local areas. The weaknesses of a linear approach to performance management underpin this emergence. Two studies support the conclusions of the thesis: i) a descriptive research frames the sources of the image of the “Taormina-Etna tourism district”. The case study discusses what factors drive the local area image. An explanatory analysis further advances the DPM chart into an SD model, which unfolds the effect of the image on tourism presence. ii) An action research uses an SD-based interactive learning environment (ILE) to foster learning of decision-makers in tourism destinations. Findings. The outcome-based DPM frames the sources of the image of a local area by identifying the linkages between output and outcomes, and simulations explain that advertisement campaigns lock system’s performance into better-before-worse dynamics, while addressing structural contextual issues seems to be a sustainable worse-before-better policy. The action research corroborates that SD-based ILEs enable policy-makers to: i) review their mental models, ii) understand strategies’ interdependence, iii) perceive time delays between decision and results; and iv) link short-term with long-term sustainable policies. Implications. The research demonstrates that DPM enhance the governance of a local area, and supports policy-makers in designing and assessing sustainable policies. Causal analysis and simulations allow decision-makers to revise and question their mental models by focusing on the factors affecting performance. Originality. This work mixes a monographic profile of a doctoral thesis with a paper-based dissertation. A theoretical basis is provided by two initial chapters of literature review. This analysis sustains the findings and implications from the field analysis developed into four core chapters. A concluding section remarks theorethical, methodological, and practical findings. The work is multidisciplinary: it is focused on local government issues, it investigates tourism destinations as meta-organizations, it uses a simulation-based methodology to understand performance dynamics, to assess policy’s sustainability, and to foster a learning oriented perspective to planning.