Public management

Posted: October 23rd, 2013

Public Management

Introduction

Irrespective of the fact that performance measurement as a management technique dates back to the 19^th century, it is within the past pair of decades that performance management within the public sector has undergone intense reinvigoration especially in the context of enumerating outcomes and awarding results. Nonetheless, the main aspects responsible for the intense focus on performance management comprise various demands. These demands contain the need for responsibility regarding governing entities and the public, and the emerging obligation among managers and organizations in focusing on outcomes and enhancing performance. As such, numerous stakeholders exude significant interest in the utilization of performance measures in order to determine, manage and possibly improve decision-making, performance and responsibility among public organizations.

In the contemporary managerial context, the notion of performance management comprises modern changes in public management. Such deviations from existing performance management presuppose an improvement in transparency and answerability, installation of long-term permanence and ensuring positive results through better execution of organizational strategies. Therefore, the importance of performance management within public organizations is crucial. However, the challenges encompassing the execution of performance management based on modern managerial reforms poses considerable implications that relay intense pressure on the need for public organizations to exude considerable performance. As such, regardless of the assertion that performance management provides a description of the performance among public organizations, it is also evident that performance management is not a panacea for solving the issues, problems as well as the challenges that encounter organizations within the public sector.

Performance Management in the Public Sector

One of the considerable issues facing public management involves the improvement of performance management within the public sector. Nonetheless, understanding performance management requires an accurate delineation of performance measures. According to Hughes (2012), performance measures comprise unprejudiced and quantitative indicators responsible for enumerating various elements of public performance. Consequently, performance measurement is the procedure of defining, monitoring and utilizing performance measures in order to determine organizational performance on a standard basis. Disparate types of performance instruments concentrate on tracking specific performance dimensions such as functioning efficiency, output, and effectiveness, quality of the service offered, customer contentment and cost efficiency. As such, performance measurement comprises the process involved in delineating, observing and utilizing such measures. Therefore, such key performance measures form the basis of performance management systems, which establish the drivers of performance and the outcome measures within the public sector organizations.

As such, performance management refers to the processes involved in the administration of the work of employees and units of organization in order to capitalize on their efficiency and augment organizational performance. The most beneficial approaches towards performance management comprise Management By Objectives and Results (MBOR)-type structures, which focus openly on employees and managers due to New Public Management Reforms. The notion of performance management arises from the need to induce effective function of public organizations and agencies. As such, in addressing effective function among public organizations, it is vital for employees, plans, organizational units and managers to guide their tasks towards reaching targets and achieving objectives that are constant with higher-status aims and goals, preferences of the top management, strategic proposals and the organization’s mission (Aulich, Halligan & Nutley, 2001). Essentially, performance management provides the basis for the completion of such objectives and tasks by assessing the comparative performance of the current strategies, monitoring progress and assessing outcomes and taking apposite summarized actions aligned with general organizational goals.

Usually, organizations within the public sector utilize performance management systems based on an MBOR perspective. MBOR systems are prevalent within the public sector based on the association to personnel evaluation procedures. Based on this relationship, MBOR systems typically function in yearly cycles. Furthermore, the performance management system focuses on the clarification of organizational prospects for the performance of individuals, motivation and the effective attainment of the specified objectives. Nonetheless, the application of performance management is impossible without the inclusion of performance monitoring structures. Performance monitoring involves tracking the main sets of performance instruments over a certain period in order to measure process and assess the outcomes arising from public programs and obligations (Ferlie, Lynn & Pollitt, 2005). Particularly, performance management schemes constitute performance management, which focus on guiding and managing organizational entities through explanation of anticipations and the appraisal of outcomes based on agreed rational measures.

Nonetheless, the main goals encompassing performance management in the public sector involve the objectives inherent to the measurement of performance. Typically, the objectives of performance measurement induce improvement in transparency and answerability, instillation of long-term permanence and ensuring positive results through better execution of organizational strategies. Specifically, improving answerability and transparency involves understanding the uniqueness of the public sector specifically in its desire to exude transparency to its stakeholders. Nonetheless, the challenge encompassing this objective stems from the organizational cultures, configurations and processes, which complicate the attainment of accountability and transparency. The instillation of long-term permanence derives its challenges from the devised turnover of voted officials and full administrations. Consequently, the need to execute better strategies summarizes the need for an effective performance management system that will endorse the management of strategy execution in public organizations.

Nevertheless, the notion of performance management in the public sector is a dynamic factor based on the deduction of novel and contemporary managerial reforms. These reforms outline the main objective of the performance management. Consequently, the aim surrounding performance management involves aligning the ambitions of stakeholders as well as the organizational culture with the dynamic temperament of open services and the resources accessible for effective delivery. Furthermore, the reforms regarding performance management seek to ensure the alignment and optimization of resources among firms, collaboration and answerability as well as strategic budgeting and planning (Eliassen & Sitter, 2008; Hughes, 2012).

Inherently, such managerial reforms focus on ensuring that performance management in the public sector integrates individuals, processes, proficiency and infrastructure, which will permit public organizations to make considerable strides in amplifying their particular performance, in the business environment. However, the challenges arising from such modern managerial reforms with respect to performance management imply the difficult and convoluted path that lies ahead regarding the implementation of new performance management styles and systems in public sector organizations.

Contemporary Managerial Reforms & Performance Management

Irrespective of the multiple techniques utilized for performance management in different countries, contemporary managerial reforms encompassing this notion comprise common implications associated with the novel form of performance management. This new type of performance management described as the New Public Management (NPM) arose from the need to define the responsibility and nature of the public sector as well as public administration. As such, NPM arose from the conjecture of public choice and a sequence of continuing reforms within Western governments. Consequently, the internationalization of New Public Management through developing and developed countries implies a common delineation for the concept, which involves attempting to conduct the implementation of management ideas from the private sector into the public sector (Haynes, 2003; McCourt, 2001). Kettl (2000) recognized productivity, service acclimatization, decentralization and answerability as the internationalization and revolution of public management.

Similarly, Ferlie, Lynn & Pollitt (2005) provided a typology of NPM representations such as economizing, the drive for effectiveness and excellence and acclimatization of public service. Furthermore, the change in NPM under a managerial context receives considerable evidence from the inculcation of various other concepts that were invisible in conventional public management. Tenets such as novel and explicit performance standards and measures, However, NPM does not solely comprise managerial and service provision innovations. It also constitutes a collection of thoughts regarding a person’s nature and the state’s responsibility within its society. According to Lane (2000), the tenets of NPM arise from an agenda of privatization, marketization, and liberalism. As such, the change in managerial reforms to include NPM concepts poses a considerable change in the conduction of performance management within the public sector. Therefore, the main impact arising from the adoption of NPM managerial reforms is the incorporation of Management By Objectives and Results (MBOR)-type performance management in public sector organizations.

The MBOR-type performance management structure comprises three constituents. The first constituent of the system includes the formulation of lucid goals and aims. Managers should embark on the creation of stable, constant and apparent objectives as well as offer subordinate entities freedom and prudence in routine obligations. The second element involves reporting performance and outcomes using an effective organization of key performance indicators by government entities and organizational units. Lastly, managers should utilize the reports to award fair performance and execute ramifications for poor performance. Hence, the main postulation regarding MBOR performance management is that the system will amplify efficiency without evoking an undesirable effect on other objectives and values (Pollitt, 2003). The creation of MBOR-type performance management structure outlines that goals and objectives within the public sector are unequivocal. The structure also surmises that the performance measures possess a simplistic definition and that measuring the results and outcomes is relatively simple.

Furthermore, the extent to which NPM managerial reforms influence performance management within the public sector gains significant illustration from the alterations and modifications in measuring performance within public organizations. Since NPM managerial reforms support the MBOR-type management system, the manner in which performance undergoes measurement in the public sector possesses considerable disparities with conventional performance management. Performance measures with respect to MBOR-type performance management support outcome orientation. This is because such performance measures focus on the duties and obligations of managers and their respective employees. Consequently, the measures influence managers and employees to work collaboratively in order to attain the set goals and objectives for the respective organization. Moreover, the data arising from the performance measures poses a considerable influence on the people’s decisions and choices, mannerisms, targets and performance.

In addition, MBOR performance management systems considerably subject intense scrutiny to managers. This factor is considerably new in public management based on the assertion that managers within the public sector accounted less for the dismal performance of their respective organizations. Furthermore, it is evident that managers in the public sector always resist the thought of being individually answerable for real results since they possess diminutive control over such dynamics. Nonetheless, MBOR systems usually utilize measures of productivity as well as instantaneous outcome measures, together with key quality markers which managers possess power over (Poister, 2003). Furthermore, MBO performance management systems support project orientation. They possess an array of initiatives and measures that usually alter over a certain period. This also presents an extensive change in performance management in the public sector based on the realization that public organizations, as much as private sector, also acknowledge the dynamics of the business environment.

Therefore, the changes established by the NPM managerial reforms receive depiction from the changes evident within performance management in the public sector. The extent to which change in managerial reforms goes is evident in the fragmentation and disintegration within state political and administrative systems, which possess a considerable impact on performance management. Hence, the change in such systems necessitates the innovation of MBOR performance management systems that involve the private sector practices into public firms.

Challenges in Performance Measurement in Public Organizations

Irrespective of the considerable advantages that performance measurement relays to the public sector, various challenges still underline the enumeration of performance in the public sector organizations. Furthermore, such challenges produce significant implications regarding measuring the performance of public sector organizations:

Irrelevance and Futility of Information

Usually, information arising from the conduction of performance measurement only gains usage if it is useful to the managers and respective decision-makers. Additionally, most performance measures do not produce relevant information since they are inconsistent in providing results that are of insignificant concern to managers. The implication arising from this challenge delves primarily on decision-making and strategic planning in organizations within the public sector. If the information produced from conducting performance measurement is insufficient, then it is impossible for the manager, who usually assumes the decisional role to make fair and conclusive decisions based on the information provided. Regarding strategic planning, if the performance measures within a particular public firm prove to be inconsistent with the strategic agenda, then such measures are likely to affect strategic planning since they seem untrue and unrealistic to the manager.

Unauthenticated Performance Measurement

The level to which the information arising from performance measurement proves meaningful relies considerably on the respective performance management system. This is a challenge in measuring performance within public organizations based on the assertion that a meaningless performance management system is unable to provide credible information. Furthermore, the performance measures used within the respective system determine the importance of the performance measurement system. The implication arising from this challenge focuses on its effect on stakeholders. A broad array of stakeholders possesses interests in performance measurement structures. As such, the professed authenticity of such a system depends significantly on the degree to which stakeholders invest in it. Therefore, if the information arising from the performance measurement deems insufficient, then stakeholders will fail to invest in the system, which in turn will lose reliability. Consequently, the system will prove inefficient in the demonstration of responsibility or improvement of performance.

Prejudice in Measuring Performance

Measuring performance in organizations within the public sector leads to the production of information that may exude bias and be in use to the injury of others. This usually takes place where the performance measures in use possess imbalance, which enable them to concentrate significantly on particular performance criteria to the disadvantage of others. This poses an undesirable implication based on the displacement of goals among managers and workers. Due to such imbalance, managers and workers are more likely to concentrate on performing exceptionally in insignificant measures and in the event, ignore significant goals since they are absent from the measures. This creates the displacement of goals and as such, leads to poor overall performance.

Misuse of Performance Data

Another challenge encompassing the measurement of performance in public organizations involves the abuse of performance information. Data arising from enumerating performance and indicating average or poor performance provides a platform to inflict penalties on managers and faculty unfairly. Generally, performance information influences selective rewarding among workers and managers. This results into a sub-optimal organizational culture based on negative relationships within the workplace. Because of this implication, the productivity of the organization reduces and further affects the needs of the stakeholders. Furthermore, long-term implications from such a challenge will desensitize the organizational workforce on the need to measure performance since such information may be in use against them.

Conclusion

Performance measurement is a crucial task within both private and public sectors. Regarding the private sector, the considerable performance of organizations within this sector illustrates the use of performance management mechanisms that allowed managers to formulate strategies. Nonetheless, with the introduction of New Public Management managerial reforms within the public sector, performance management within the sector assumes a novel nature based on the adoption of Management By Objectives and Results (MBOR) systems such that operations within the private sector similarly depict those within the public sector.

References

Aulich, C., Halligan, J. & Nutley, S. (2001). Reforming public sector management. In C. Aulich, J. Halligan, J. & S. Nutley (Eds.), Australian handbook of public sector management (pp.11-19). Sydney: Allen & Unwin.

Eliassen, K. A. and Sitter, N. (2008). Understanding public management. Los Angeles: Sage Publications.

Ferlie, E., Lynn, L. E., & Pollitt, C. (2005). The Oxford handbook of public management. Oxford: Oxford University Press.

Haynes, P. (2003). Managing complexity in the public services. Maidenhead: Open University Press.

Hughes, O. (2012). Public management and administration. Basingstoke: Palgrave.

Kettl, D. F. (2000). The global public management revolution: A report on the transformation of governance. Washington: Brookings Institution Press.

Lane, J. (2000). New public management: An introduction. London: Routledge.

McCourt, W. (2001). The internationalization of new public management. In W. McCourt & M. Minogue (Eds.), The internationalization of public management: Reinventing the Third World state (pp. 1-19). Edward Elgar: Cheltenham.

Poister, H. T. (2003). Measuring performance in public and non-profit organizations. San Francisco: Jossey Bass.

Pollitt, C. (2003). The essential public manager. Buckingham: Open University Press.