The National Academies

NCHRP 08-70 [Final]

Target-Setting Methods and Data Management To Support Performance-Based Resource Allocation by Transportation Agencies

  Project Data
Funds: $800,000
Included $100,000 of FY2011 funds
Research Agency: Cambridge Systematics, Inc.
Principal Investigator: Randall Halvorson, Erik Cempel
Effective Date: 1/24/2008
Completion Date: 6/30/2011

Transportation agencies at all levels of government are embracing performance measurement to guide their resource allocation decisions for operations, asset management, capital investment, planning, and policy development. While there is extensive and growing literature on defining and applying performance measures, little attention has been given to specific methods for setting performance targets within the context of their efforts to achieve multiple objectives and interact with multiple decisionmakers and stakeholder groups. Setting targets generally entails balancing among competing objectives and dealing with political implications. Unless performance targets are set with sound and defensible bases, and with the concurrence of key decisionmakers and stakeholders, the effectiveness of performance measurement as a management tool to improve agency efficiency and accountability is compromised. 
NCHRP Report 551: Performance Measures and Targets for Transportation Asset Management, outlined basic steps for setting targets, but the methods described were limited primarily to asset preservation. This project was undertaken to develop a more comprehensive set of methods to establish performance targets to guide resource allocation decisions in all aspects of transportation agency management, from planning and policy development to project implementation and operations. 
The objectives of this research were to (1) describe a comprehensive framework and set of methods (a) to analyze opportunities to improve the multiple-objective performance of transportation systems within the context of broader societal goals and (b) to set specific performance targets to guide agency policies, plans, and programs; (2) detail the factors that influence target setting and the success of performance-based resource allocation systems and explain how agencies may successfully design, implement, and use such systems; and (3) analyze the data and information needs, data acquisition and management systems, and institutional relationships required to support successful performance-based resource allocation systems. 

The project was initially defined in three phases.  Phase 1 reviewed the state of practice, describing the key elements of a performance-based resource-allocation process and the tools and data-management systems and institutional relationships needed to support these elements. The review included organizations that use performance-based resource allocation and examples of their methods for setting performance targets, monitoring performance, and communicating with decisionmakers, partnering agencies, and other stakeholders. Phase 2 characterized performance target-setting process and methods, including the role of forecasting; data availability, precision, and reliability; agency experience with benefit-cost analysis and other analysis methods; and stakeholders’ expectations and perceptions.  The research team developed guidance for how agencies might most effectively set up and use target-based performance management.  Phase 3 focused specifically on the data management systems and institutional relationships needed to support performance-based resource allocation. The contractor's final report covering work through Phase 3 was published as NCHRP Report 666 and supplementary Web-Only Document 154
Following this initial work, an extension of the research considered how risk analysis and data management practices may best be used by transportation agencies specifically to support effective performance-target setting.  NCHRP Report 706 presents advice and case studies in the form of primers on risk analysis and data management practices for performance-target setting. 

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