Searching for a strategic fit

Performance management (PM) has become the dominant approach to federal management reform. In compliance with government requirements, federal agencies have been implementing a variety of PM activities, but with quite different levels of success. Based on the notion of strategic fit-i.e., that a strategy can work for an organization only when it fits well with the organization's external and internal environments-this study examined the conditions that can affect the implementation of PM within federal agencies. The analysis included two major groups of factors-external political environments (structural insulation, influences from external political authorities) and managerial capacity (strategic planning capacity, analytical capacity). Data collected from 103 federal agencies provide general support for the importance of these factors in PM implementation. Implications of the findings for PM in government organizations, and for the broader issue of administrative reform, are discussed.