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Keywords:

  • performance management system;
  • interactive use of control;
  • satisfaction;
  • process innovation;
  • healthcare organizations

SUMMARY

This paper shows how the use of performance management systems affects managers' perception of satisfaction, the effectiveness of the control system and the performance related to process innovation. An exploratory empirical research has been conducted on 85 managers operating in Italian healthcare organizations. Empirical findings put forward that the interactive—as opposed to diagnostic—use of performance management systems enhances managerial satisfaction with the control system and managerial perception of effectiveness. The present study then showed that it is not the control itself that is an obstacle to innovation in organizations in general (and in health organizations in particular) but the diagnostic use of the control mechanisms, which impedes the interaction between the control personnel and those subject to the control. Finally, this paper addresses managerial implications and further research avenues. Copyright © 2013 John Wiley & Sons, Ltd.