Implementing Big, Bold Goals (Part 2)
This is the second in a series of blogs that outline a path that I proposed at a UN-sponsored meeting in Switzerland this past April.
From Vision to Implementation: A Framework for Action Based on Key Lessons of International Experience. While the UN’s Sustainable Development Goals (SDGs) may represent a new vision for the global community, the challenge of implementing desirable ideas is an old one. Most management experts now agree that good ideas and good intentions do not self-implement. Experience has also shown that it is not enough to merely have good people or well-meaning policy makers. (Watch the video of President Obama speaking about SDGs at the UN General Assembly.)
The literature on New Public Management offers following insights on improving implementation of public policies, in general:
What Are the Determinants of Effective Implementation? As depicted in Figure 1 below, 80 % effectiveness and of implementation depends on quality of performance management systems and 20 % on quality of people working within the system. This 80:20 principle is attributed to management guru Peter Drucker.
Within the people category, 80 % of the impact on implementation is attributable to quality of leadership responsible for performance management.
For effective implementation, therefore, all one needs is a ‘good’ performance management system and ‘good’ leadership. Indeed, creating a good performance management system for effective implementation of public policies, programs and projects is one of the main responsibilities of nation’s leadership. They need to not only create an effective performance management system but also nurture it to ensure its growth and development.
Figure 1: Determinants of Implementation Effectiveness
Accountability for Implementation Trickles Down in an Organization. Experience shows that accountability for implementation ‘trickles down’ and never ‘trickles up.’ Thus an effective performance management system must begin by holding the top echelons of government hierarchy accountable for implementation and results.
Effective Implementation Requires a Multi-dimensional Approach. To improve performance of any organisation we need a multidimensional effort. Experts believe that the following four systems are necessary for improving performance of any organisation: (a) Performance Information System, (b) Performance Monitoring System, (c) Evaluation System, and (d) Performance Incentive System.
- A performance information system ensures that appropriate information, in a useful format, is available in a timely manner to stakeholders.
- A performance monitoring system allows the responsible managers in the organization to manage their journey towards the desired results. Hence, a monitoring system is a complement to an evaluation system.
- A performance evaluation system is meant to convert, distil and arrange this information in a format that allows stakeholders to assess the true effectiveness of the organisation.
Finally, no matter how sophisticated the information system, how accurate the evaluation system, and how robust the monitoring system, performance of any organisation can improve in a sustainable manner only if it has a performance incentive system.
- A performance incentive system links the performance of the organisation to the welfare of its employees.
That is, performance or lack thereof must have consequences for people to care about improving it. A well-designed incentive system allows the employees to achieve organisational objectives in their own self-interest.
Performance Agreements are an Effective Tool for Improving Implementation. After extensive review of the NPM literature, the Second Administrative Reform Commission set up by the Government of India argued that Performance Agreement is the most common accountability mechanism in most countries that have reformed their public administration systems. This has been done in many forms - from explicit contracts to less formal negotiated agreements to more generally applicable principles. At the core of such agreements are the objectives to be achieved, the resources provided to achieve them, the accountability and control measures, and the autonomy and flexibilities that the civil servants will be given.
In New Zealand, for example, the Public Finance Act of 1989 provided for a performance agreement to be signed between the chief executive and the concerned minister every year. The performance agreement describes the key result areas that require the personal attention of the chief executive. The expected results are expressed in verifiable terms, and include output-related tasks. The chief executive’s performance is assessed every year with reference to the performance agreement.
The New Zealand system provides for bonuses to be earned for good performance and removal for poor performance. The assessment is done by a third party - the State Services Commission. Due consideration is given to the views of the departmental Minister. A written performance appraisal is prepared. The chief executive concerned is given an opportunity to comment, and his/her comments form part of the appraisal.
Similar policies are being used in most OECD countries. The other leading examples of this policy come from USA. In the USA, the US Congress passed a law in 1993 called the Government Performance and Results Act. Section 4 of this law requires each agency of the US Government to prepare an Annual Performance Plan, very similar to performance agreements used elsewhere. In the UK, this policy was called Public Service Agreement. In developing countries, the best examples come from India, Bhutan, Malaysia and Kenya.