The use of performance management in government is growing, and the momentum is getting stronger. That's one of the findings in two recent reports, one from Accenture, the other from IBM. At the same time, however, both studies point to problems and inconsistencies in how performance management is applied in the public sector.
"Managing Current and Future Performance: Striving to Create Public Value," published by Accenture's Institute for Public Service Value, found widespread adoption of basic performance management techniques, based on a survey of 300 senior-level executives at all levels of government in nine different countries. However, there remains "great confusion and inconsistencies in the definition of outcomes."
For example, only 25 percent of the respondents "gave examples of a genuine outcome target, such as crime reduction or improved health status." Far more common were examples that were outputs, such as conviction rates in courts or waiting time for emergency responses, while others related to quality of service standards.
In countries where adoption of performance management ranked high, a large majority (74 percent) said performance management "helped improve organizational performance." But barriers to better performance have created challenges, according to the report. Government executives mentioned problems with accounting for outcomes that are shared across multiple departments, the pressures of electoral cycles and the difficulty of securing employees with the right skills.
Despite the growth in performance management practices, the public sector still tends to use it as a way to "report accomplishments (or failures) rather than shape future efforts to improve organizational performance." It also struggles "to align performance objectives with budgets and to develop the flexibility to respond mid-cycle to deviations from expected performance results."
In the fall 2007 issue of The Business of Government, published by IBM Global Business Services, several articles focus on the challenges faced by the federal government in performance management. They also report that a worldwide movement toward performance management in the public sector is under way.
Unlike the Accenture report, which focuses on performance management systems and their value, IBM probes the issue from the perspective of a human capital practice. The articles focus on the challenges faced by the federal government when it comes to enhancing its performance management programs, which have been met with much skepticism from federal employees.
The articles provide some insight into how to design and implement performance management, emphasizing the "cultural shifts that are needed to successfully implement PM reform, including the roles and responsibilities of managers and employees necessary to change the way employees are managed."
Two key factors for success: a high degree of transparency and communication between managers and employees. While the reports focus on the federal government, the broader lessons learned can apply just as well to state and local government.