A recent study commissioned by the OECD concludes that while the focus of performance management in today’s public sector is rightly on delivering results, particularly service quality, governments in the 80 or so democratic regimes around the world do not appear to be meeting citizen expectations.
Paul Thomas, in a review of government performance management regimes in Canada, New Zealand, the U.S. and the U.K., has argued that while there are undoubtedly positive benefits accruing from the use of performance management practices, by and large, they have not delivered as much as expected. Thomas argues that performance management practices, while often sound in theory, are difficult to implement with any degree of real impact within the public sector environment.
What are the barriers to implementation? While we won’t offer solutions per se, we will raise a few questions about why implementation seems difficult, and invite readers to respond with their own thoughts or, indeed, with examples of good implementation of performance management practices.
It might be useful to clarify the term “performance management” (PM) and its relationship to performance measurement. For our purposes, PM refers to a cycle of managerial activities that includes planning (setting objectives), measuring results, and using these measurements to reflect on the accomplishment of objectives, explore performance problems or opportunities and make changes to improve both operational and strategic outcomes. Performance measures therefore contribute to PM; they are not an end in and of themselves.
The PM cycle can occur at the organizational level – also referred to in popular literature as corporate PM, business PM or government PM – and at the individual level where we often refer to goal setting, performance feedback and performance appraisals. The cycles are obviously linked because organizational performance is always dependent on individual performance. When we speak of implementation, therefore, we speak of implementing the full cycle at both levels.
Many who comment on the success of PM practices in the public sector would argue, as Thomas has, that implementation is poor. In reality, most public sector jurisdictions have created quite detailed frameworks and models for planning and measuring. The problem occurs at the third stage in the cycle: the use of performance measures to improve program delivery.
Indeed, a quick review of almost any public sector regime in democratic countries will uncover a multitude of frameworks and models for identifying strategic outcomes, creating and reporting measures of performance and conducting program evaluations and other forms of audits to explore value being created by program offerings of departments and agencies.
The problem, then, is not so much that implementation is poor; rather, it is incomplete – there is an awful lot of planning, measuring and reporting going on, but whether the information from these measurements are used to actually improve program delivery is open to question.
For example, a recent survey of 117 deputy ministers and chief administrative officers in Canada revealed that only 17 percent used performance measures to make key decisions. The survey also captured data from 500 or so of IPAC’s members, which was only slightly better: 23 percent indicated that performance measures contributed to decision-making in their organizations.
Similarly, in a case study of two large public sector organizations in the U.K., Zoe Radner and Mary McGuire found that managers made little use of performance information no matter how good the data appeared to be. The reason given was information overload – most managers had too many other reports to prepare, review, sign-off and submit to spend time truly digesting the information contained in any one.
The case is similar for program evaluation. A recent survey and multi-case study by one of the authors on the use of program evaluation results in the Canadian federal public service found that government sector evaluators and users report a lower capacity to use evaluation results and findings than those in the non-profit sector. This may be due to the lack of an organizational learning culture, the credibility and timeliness of evaluation results and the lack of ownership by program managers of evaluation results.
Finally, in a recent survey of 80 public sector organizations, the top three barriers to implementation of performance management practices included organizational culture, lack of integration between the strategic and operational layers in the organization, and lack of integration among the various performance measurement tools being used.
These findings support the earlier assertion that although government organizations have made significant investments in performance measurement, very little is done with these results to enhance continuous learning and to improve program delivery.
So what are the potential barriers to the effective implementation? Figure 1 illustrates three key barriers as identified by various researchers and practitioners: lack of integration among various layers in the organization; organizational culture; and the political environment in which most public sector organizations operate.
1. Lack of integration
Figure 1 depicts a typical organization comprising three layers. The strategic layer is concerned with establishing strategic outcomes, securing resources and reporting on results at a departmental level. The programs layer has a PM cycle of its own, as does the resource management layer. Quite often, each layer has to respond to different stakeholders with different plans and different performance reports. This causes a fair degree of internal work. Therefore, many larger organizations turn over the planning and reporting functions to specialized corporate services groups for the purposes of keeping pace with the sheer number of reports being demanded by stakeholders.
Indeed, Ian Clark and Harry Swain have argued that the planning and reporting cycle occurring at strategic layers are somewhat surreal in that they are intended to respond to central agency requirements more so than to improve program delivery. This lack of integration leads to the generation of a multitude of planning and reporting documents resulting in the information overload referred to earlier; it also means that so many different versions of performance measures are being created that it is difficult to know which are “real.” It is easy to see how this state of affairs would discourage managers from relying on performance information to make critical program delivery decisions.
2. Organizational culture
Research suggests that organizational cultures that encourage achievement and accountability within a climate of trust and mutual support are best suited for the introduction of PM practices. Yet, most observers who comment on public sector PM would argue that while there is an emerging focus on achievement, especially as it relates to quality service delivery, the notion of accountability is still not well developed. Furthermore, the level of trust needed for frank and open discussion of performance results, both good and bad, is often not present.
3. Political issues
Within a public sector environment, politics are obviously at play. In most Westminster-type systems, the notion of ministerial responsibility is a given, therefore all actions within the bureaucracy are closely scrutinized. Thomas argues that this political nature of the public sector mitigates against the effective use of PM because a PM cycle is intended to be rational, objective and forward-looking while the political aspect is more thea