There are many arguments that has arose over the last twenty years or so for performance management in the Public Sector. According to Talbot (2007) a wide range of arguments have been put forward for placing a greater focus on performance. The first argument is performance as accountability and transparency. Citizens need to be given information on what government money is being spent on and what results are being achieved. The UK is now one of the most open and transparent country’s in the world (Sir Time Berners-Lee 2015) ensuring their promise to have all information available for public view as some citizens view this as a democratic right. An example of this would include publishing school inspections results in the UK.
A further argument which relates to accountability is performance as user choice. Publishing comparative Performance information allows citizens to make more informed decisions especially if they have a choice in which service to utilise for example it can help parents to select which school they send their child. This can also help improve services where there are no other options available as it can put pressure on low performing cases to improve their services. ‘In its most developed form the policy of user choice has been linked to resource distribution’ (Talbot 2007).
Another beneficial argument for performance is performance as Customer Service. Public organisations should be making clear statements about the level of service they intend to supply, in terms of timeliness, accessibility and quality and then publish reports to the public on what they have achieved. Now that modern citizens have more access to information they have higher expectations on what can be delivered. The ‘Charter Mark’ was introduced in 1991 under former Prime Minister John Major as a means of demonstrating a national standard for excellence in customer service in UK public sector organisations as the public sector had been highly criticised for their poor customer service. In 2008, the Charter Mark was replaced by the Customer Service Excellence Standard which gave public sector organisation recognition of excellence in service delivery standards and this reward can be revoked if the customer service within the organisation is not maintained at a high standard. Queen’s university has achieved this Customer Service Excellence Accreditation.
Perhaps the longest running argument to produce performance information (but not necessarily its publication) is a managerial one (Downs and Larkey 1986). As public organisations have no ‘bottom line’ other measures of success (or failure) must be identified. The main purpose is to improve the efficiency of public organisations which are otherwise free from incentives. Therefore, if programmes and/or policies are not working, the government needs to understand why and make changes to them. It is stressed that ‘performance and performance targets is principally about outputs not outcomes’ (Talbot 2007).
Another argument for Performance Information is performance as results, effectiveness and having a bigger focus on ‘what works’. This suggests that the government may have lost sight of the outcomes they wish to achieve and is more focused on the inputs. The focus is on what has been variously called “outcome based governance” or “outcome based budgeting” (Molen, Rooyen et al. 2001).
Performance as resource allocation is closely related to the above argument. It is argued by many scholars that it is necessary to understand the utility of resources allocated to any specific policy area. Therefore, it Performance Information is essential for decision making about resource allocation (Talbot 2007). This has been highly developed, at least rhetorically, in systems such as the UK’s Government Performance and Results Act (Mihm 1995; General Accounting Office (USA) 1997a and b; Forsythe 2000).
The final and most recent argument is Performance Information creating public value. This argues that public services have more a positive role in creating value which could not be made in the private sector (Talbot 2007). Public services are not just simply about addressing ‘market failure’. In the UK the public sector has a long history of positive attitudes and achievements in adding value through issues such as equity, equality and building social capital. Each of these arguments above for performance shows that it has been beneficial and has had a massive positive impact on the public sector within the UK.
Arguments against ‘Performance’
In Performance information, it can be argued, it is only able to give an incomplete picture of public activities. It is very hard to collect all the data needed opening a degree of distortion and exclusion and what is not measured may be of value to another stakeholder.
A result of the above argument is that there is a tendency for performance measurement systems to become ever too complexed. The more resources the more complex it can get causing an information overload. Collecting all these resources can also be very costly and unworkable. Leading to another argument against performance as the costs of producing performance information, especially in complex areas, can easily become prohibitive. Time is money and it take an extensive amount of time to capture performance information and this valuable time could be used elsewhere for example it could be argued that instead of an NHS doctor filling out numerous amount of forms and collecting data he could instead be carrying out more operations on critically ill patients.
Performance Information also faces the attribution problem which is usually discussed in relation to outcomes. Questions need to be answered such as have the outputs of public services resulted in the desired outcomes and, if so, can these be attributed to the outputs? Performance measurement is inevitably about trying to put quantitative values onto many aspects of public services which are extremely difficult to quantify. Quantity and quality is very important however, the longer-term impact can’t always be captured and may be just as important. Leading to the problem that ‘many aspects of “good” performance is not easily measured (Talbot 2007).
Where performance measures are forced and lead to rewards or sanctions it is argued that information is more at risk of being manipulated and dishonest. Another consequence of offering rewards and sanctions may result in distorted behaviour in which performance is not optimised. This can also lead to individuals using all their resources in one specific area just to meet their set goals and targets, neglecting areas which are equally important to the organisation.
As performance measurement has to be sustained and consistent over long periods of time to be effective it is hard to maintain this sustainability and consistency. Likewise a recent argument has emerged about performance targets which suggests that there is empirical evidence to support the notion that the effectiveness of performance measurement deteriorates over time, undermining the very possibility of long-term stability in performance measurement (Talbot 2007).
Another argument, first espoused by Charles Lindblom, is that public systems are dominated by politics which inevitably leads to instability, incrementalism, muddling through, messy compromises and value judgements which fatally undermine all attempts at rational decision making (Van, Dooren, Wouter, et al. 2015).
Performance Management Traps
So, we have saw that Performance management provides interesting possibilities for enhancing public sector management and policy making (Bouckaert and Halligan 2008). However, there are numerous traps in performance management put forward by Van Dooren et al 2015, for example the lack of interest by politicians/citizens can have a big impact as publishing information that has no public value needlessly uses a lot of money and resources. This also means that key vital data can go unacknowledged by the public as there is no motivation put behind it. Furthermore, being vague and not informing employees what the overall goal is for the organisation is another trap as people can easily lose focus or misunderstand what the aim is. Strategic management is seen to be weak within the public sector. Selecting indicators without any setting any targets or goals just because it is easy to collect the data is another trap as it does not show the bigger picture and can lease the information collected incomplete. Window dressing and gaming is seen as another trap in performance for example politician’s issuing a report saying they’ve achieved more than they actually have can then manipulate citizens. Finally, the use and non-use of data is another drawback as it costs a lot of money to capture data and sometimes at the end it the data collected has no real tangible use and can’t help shape any policies going forward.
How Successful has Performance Management Been
There have been at least three decades of attempts to improve the performance of the public sector. It is really difficult to actually make a judgement of how beneficial performance management has actually been because the reality is we don’t have what would have happened in its absence. Looking at the results, without attributing improvements to performance management efforts. Hood and Dixon (2015), analysed the costs of running government from 1979-2013. They found that gross running costs increased in all departments, despite a reduction in civil service numbers. From 1987-88 to 2003-04 the pay bill costs of civil departments rose 19% while the non-pay bill portion of the gross running costs of the same departments more than doubled. The non-pay bill component included consultancy fees and costs of public finance initiatives and outsourcing contracts and, of course, such costs included the pay of those working for outsourcing companies. Hood and Dixon’s (2015) assessment is clear: the search for reduced head-count in the civil service, achieved mostly by outsourcing and the use of consultants, dramatically increased the running costs of the civil service.
In conclusion with regard to the processes within the public sector, John Manzoni, the CEO of the civil service, said: ‘For a system that delivers so much, we don’t yet have a well-developed performance management culture…the Civil Service needs mechanisms which performance manage outcomes and which at the same time reinforce and clarify accountability’. Regarding the future of performance management Van Dooren suggests that better implementation may resolve some of the issues, however, ‘another option is to fundamentally rethink the blueprint of performance management in order to better fit with complex environments’ (Van Dooren et al. 2010, p. 175). The author’s make three recommendations: performance management needs to be agile; close to the action; and political. Performance management has been based on the idea of the ‘principal-agent’ problem. The System was designed to be continuous from a series of high-level goals, through organisational targets to individual targets for public sector workers (Norman Flynn 2012).
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