In the National Business Intelligence (BI) Survey, the public sector achieves the lowest score of all the sectors. It is interesting then to know what the business sector is really doing differently from the public sector. Where are the opportunities for improvement within the context of government, education and health care? And how much room for improvement is there actually, given the legal frameworks and regulations? Or are these not really an obstacle?
1. Encourage performance orientation
There are few incentives for Performance Management in the public sector. To the question, ‘does the organization encourage performance orientation?’ 55% of respondents in the public sector answer ‘no/not enough’. In the business sector that is only 13%.
2. Make pay partly related to performance
In the business sector it is much more common for pay to be partly performance related. A difference of 58% over the public sector was recorded. Only in 15% of cases does performance in the public sector provide a basis for some form of reward, in which case it is mainly the (top) managers that are rewarded.
3. Give your employees a system to help them develop their customer-focus
Systems to support customer focus (CRM) are only sparsely used in the public sector. When asked ‘how does your organization implement customer focus’, only 15% of public institutions answer with ‘customer relationship management regardless of the channel’. In the business sector, CRM is already fairly well established (50%). The public sector has chosen to focus on customer treatment. This distinguishes them in a positive sense from the business sector. This cultural characteristic can stand out even more strongly when it can be supported by a CRM system. After all, this would allow one to understand and help the customers better and the treatment of customers to become more meaningful.
4. Update management information more often
Information is updated daily or in real-time much more often in the business sector. This can be explained by the fact that the number of transactions being processed there every day is much bigger, sometimes up to hundreds of thousands and even millions. Yet in an organization in the public sector there is still an average of a thousand to ten thousand transactions being processed per day. By managing on the basis of monthly reporting, the public sector often lags behind the facts. Making timely adjustments is much easier when management information is updated more frequently. It is however important to ensure that managers and employees can do something with that management information.
5. Regularly adjust standards and targets
Figures without targets and standards do not mean much. At most, we can observe a developing trend. Setting standards for performance indicators is a good start, although these should also be reviewed periodically, based on the most recent internal and external developments. Standards and targets in the public sector are hardly ever evaluated and adjusted; this was only reported in 18% of cases, compared to 45% in the business sector. A good example is the standard regarding the digitalization of the services. This standard has existed for about seven years and is only being adjusted to the current benchmarks and latest developments in dribs and drabs.
6. Talk to each other about the results and discuss performance
It is not the figures themselves that are important, it is being able to talk about them with each other. In the public sector, ‘not enough’ (55%) people discuss the results, in the business sector this figure is 27%. Having a dialogue about the figures that includes both positive and the negative performances is essential to achieve better cooperation and more flexible management. The motto should be ‘hard on the facts and gentle on the people’, as it should be in any ‘Plan, Do, Check, Act’ cycle.
7. Personalize dashboards and reports, based on roles
Many reports and dashboards within the public sector are still built around organizational disciplines such as finance, human resources, business operations, procurement, etc. Users must then often filter out the information relevant to them from a well-stocked arsenal of reports. A frequently heard saying in this context is that one can’t see the wood for the trees. Nowadays, it is inevitable to have a customer- and process- oriented organization. This means that the organization is, as it were, tilted, and the focus of the discipline (department) shifts to the overall process running through all the departments. Comprehensive reports and an associated dashboard tailored to the role and the person should be a part of this. All the relevant information from multiple disciplines on one screen. The business sector applies comprehensive reports much more frequently (62%) than the public sector (39%).
8. Present your services as clearly as possible
It is not entirely illogical that the public sector, and especially the Government, has an unclear structure to its product portfolio. The services are in fact very diverse and the range of products is often very large. The difference with the business sector is 23%. The public sector would be able to score much better if its products and services were organized according to target groups, and within those to life events such as moving house, marriage or starting a business. This requires a shift in the organization and the design of a front office.
9. Provide external partners with access to relevant management information more frequently
There is a hive of activity in the public sector when it comes to the digitalization of processes and electronic services. It seems that this sector has discovered the possibilities of using Business Intelligence to share relevant management information with participants, citizens, companies and clients. In 42% of cases information is shared with suppliers or customers, or both. Yet there is still a difference with the business sector of 22%, which shares information in a structured way with business partners in 64% of the cases. The brainpower of the organization can then be greatly increased: the organization is no longer managed only by managers, but also by employees at all levels, customers, suppliers and shareholders. More information in the Business Intelligence book ‘The intelligent organization’.
Technology is not an obstacle
If we go through these nine points, we see that some points are of a mainly technical nature, such as CRM, role-based reports and updating information more frequently. These areas for improvement are relatively easy to solve. Naturally it requires a (substantial) investment, but the technology is not an obstacle and a great deal can be done with it nowadays. Other points have an important cultural component, and particularly there the public sector would be able to make a significant gains if the (political) will were there. There are no legal obstacles in principle, even when it comes to performance-related remuneration as is shown by the research carried out by Prof. Karin Sanders MSc. “The question of whether performance remuneration for civil servants is possible can therefore be answered with a resounding ‘yes’. Much more important than the question of whether performance remuneration can be introduced for civil servants is in what form that will have to happen.” Initially it is about creating a performance oriented culture, and making the need to do so clear.
In the business sector, this need is often much clearer because there are (large) commercial interests at stake. The objectives are also often much clearer in the business sector, for example, making more profit or turnover. This is more difficult in a public organization, although they are certainly there.
Developing a philosophy and translating that into KPIs
The challenge is to develop a philosophy and vision in a public organization and translate it into the workplace through workshops, KPIs and objectives that can be made operational. A vision that does justice to the exalted duties of the Government, healthcare and education, namely to be of service to citizens and businesses, patients and students, in an as efficient and as effective manner as possible. And the latter can also help us to ensure that we as ‘Netherlands Ltd’ remain competitive.
Interested in the research and how we can help you excel at these 9 points? Please contact Leo Kerklaan, author of ‘The cockpit of the organization’.