MANAGING INCREASING DEMANDS FOR PUBLIC SERVICES AMIDST THE SHRINKING PUBLIC RESOURCES PRESENTATION TO MPUMALANGA PROVINCIAL SMS SUMMIT 26 NOVEMBER 2014

Presentation Outline

        Background Building a Capable and Developmental State Addressing NDP Challenges Management Practices Multi-factor Productivity Management and Measurement within the Public Service Dimensions of Productivity Management   Service Delivery Quality Service Delivery Quantity Factors influencing Productivity Measurement    Leadership and Management Practices Change Management Knowledge Management Concluding Remarks 2

There are many performance output challenges…

Background

 Emphasis on Public Service Productivity.

“The DPSA must ensure a productive public service where staff are motivated, supported, focussed and working effectively.

” efficiently and Minister Collins Centurion, 4 June 20-14 Chabane, Transforming the Public Service into an effective service delivery machinery

4

Rationale



We need a closer look at our Productivity because …..

 The Public Service is a (1)

major provider employer (and services

; and (3) ;

user)

(2)

of consumer of public tax resources

.

 Changes in productivity of the Public Service can thus have a significant impact on

ECOMONIC GROWTH

and the lives of citizens

Building a Capable State ito the NDP

 Unevenness in capacity that leads to uneven performance in local, provincial and national government.  This is caused by a complex set of factors, including tensions in the political-administrative interface, instability of the

administrative leadership

, skills deficits, the erosion of accountability and authority, poor organisational design and low staff morale. 6

Building a Capable State ito the NDP

 The SA Public Service has to respond to the impact of the changing global economy whilst still improving efficiencies and effectiveness of public administration service delivery.  It has to look inwardly into the impacts of post 1994 New Public Management (NPM) on the rising costs in running public administration without necessarily yielding tangible results 7

Impact of PS Reforms since 1994

  The drive to marketise the PS service under the pretext of modernising processes and systems, has yielded a less than ideal situation. Most government department’s operations are run in less than an efficient and desirable manner (MPAT).  The SA Public Service has to respond to the impact of the changing global economy whilst still improving efficiencies and effectiveness of public administration service delivery. 8

Impact of PS Reforms since 1994

 It has to look inwardly into the impacts of post 1994 New Public Management (NPM) on the rising costs in running public administration without necessarily yielding the desired tangible results.

 The increasing spending in government has to be curbed if we want to see economic growth  The spiralling wage bill is of concern to government as highlighted in the recent MTBPS 9

SA as a Developmental State

  South Africa has positioned itself as a developmental state defined as a condition “when the state possesses the vision, leadership and capacity to bring about a positive transformation of society within a condensed period of time ” (Fritz and Menocal Menocal, 2007) A considerable body of opinion suggests that the developmental state is not only possible, but indispensable to developing countries (Leftwich Leftwich, 2000; Bagchi Bagchi, 2000) 10

Challenges raised in NDP

 The weaknesses in capacity and performance are most serious in historically disadvantaged areas, where state intervention is most needed to improve people’s quality of life.

11

Addressing NDP Challenges on Capability

 A much more focused regulatory and policy shift in how we do business as government needs to be institutionlaised in order to address the factors contributing to the burgeoning wage bill; ICT wastage spend; bloated corporate support functions; inappropriate organisational structures; procurement wastage, etc. 12

Addressing NDP Challenges on Capability

 Efficiencies within the National Treasury directives have only focussed on savings on small ticket items in Public Administration like travel and entertainment and ‘nice to haves’ symbolic policy statements  A formal collaborative effort between ALL departments needs to earnestly to look at measures of Productivity in order to ensure management and operational practices are efficient and effective.

13

Addressing NDP Challenges on Capability

 Substantial elimnation of wastage by improving efficiencies and effectiveness of government is the key driver to achieving savings which can be used to fund other pressing needs within the PS. This will entail reviewing all institutional, functional and fiscal frameworks and the conditions for coherent support to these reform initiatives.

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Addressing NDP Challenges on Capability

 All functions carried out be government should be

measured

against the five compulsory performance objectives which are a standard for Productivity measure (i) Quality within set norms and standards; (ii) Speed of Delivery/ Timeliness and Predictability ; (iii) Dependability/ Flexibility/Durability and within a Utilitarian value to citizen; (iv) Quantity within set norms and standards and (v) Cost Benefit within Economies of Scale.

15

GENERIC DEFINITION OF PRODUCTIVITY

Productivity is the relationship between the output and input which indicates whether the activities of an organisation are efficient and effective

.

16



Evolution of Public Service Productivity in the

Traditionally there has been a greater emphasis on public service performance rather than productivity.

 There was a straight jacketed ‘

scientific

’ approach to

work study

which resulted in a positivistic orientation rather than a constructivist focus.

You can have any colour, as long as it's black  Neglect of public service productivity management started due to historical application of work-study techniques with strong

Taylorist

(industrial efficiency/ cost control) and

Fordist

(standardised mass measure.

production) orientation to

Transforming the Public Service into an effective service delivery machinery

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Evolution of Public Service Productivity in the

 

New Public Management (NPM)

paradigm dominated public administration reform

1999),

but this

(from

“

managerialism

” failed to translate into increased productivity and only borrowed very costly private sector practices which bloated the PS wage bill.

Productivity within the South African public service is undermined by the absence of an overarching framework with generally accepted measurable factors which are appropriate for the PS.

Transforming the Public Service into an effective service delivery machinery

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FACTORS INFLUENCING PRODUCTIVITY

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Multi-factors impacting on Productivity

PUBLIC SERVICE PRODUCTIVITY Cost and Time taken to deliver Service Resource Availability (human and financial

)

Service Quantity Capacity of Facility/Current Output Quantity Citizen Expectations and Satisfaction Leadership Performance Employee Competence and Capability Working Environment Operations Management Systems & Processes Reliability, Responsiveness, Durability and Utilitarian Value of service Service Quality Management Practices Norms and Service Standards applicable

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Key Service Productivity Drivers

 Measuring what matters  Building leadership and management capability  Creating productive workplace cultures  Encouraging innovation and the use of technology  Continuous Organisational Learning  Investing in people and transfer of skills  Organising work efficiently- appropriate work measurement techniques  Networking and collaborating 21

LEADERSHIP

  “Leadership by example plays a strong role in creating a positive and productive workplace culture, and inspiring others to pursue those opportunities which have been identified. Leadership depth is important.” Balance between Contribution and Growth  i.e. 40 hours Contribution + 5 hours Personal Growth

Theory in Use

is how employees in an organisation ‘reinforce’ or ‘ discard’ patterns of understanding and doing things based on the evidence based policies, processes and practices and construction, testing and restructuring of a certain kind of new knowledge driven by the type and nature of leadership which influences the culture.

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LEADERSHIP

  Events driven as cross-sectional control points instead of being process driven longitudinally The Productivity of a manager determines the parameters of sub ordinate’s productivity, as there are direct; group and cross-functional relationships in operational practice.

e.g. Education; HOD of a Government Department  Management Practices in Operations are directly linked to productivity  Consequence Management and the ability for follow through action impacts on productivity 23

MANAGEMENT PRACTICES

 Operations Management is directly linked to productivity:  Mapped Business Processes;   Standard Operating Procedures (SOPs) and Protocols; Service Standards;  Service Delivery Models;  Unit costing for goods and services;  Service Charters;  Service Delivery Models and  Service Delivery Improvement Plans 24

MANAGEMENT STRATEGIES FOR EFFICIENCIES Modernisation , Reform and Transformation Actions Performance Actions ICT Efficiencies Actions Appropriate Service Delivery Models Design Operational and Business Process Efficiencies Actions Physical Infrastructure and Asset Management Actions Human Resources Actions

CHANGE MANAGEMENT PROCESS

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Strategic Change Focus

 Context- Where and Why (Internal and External environment needs)  Process- How (Implementation)  Content-What (Objectives, Purpose and Goals)  Interrelated factors:  Environmental Assessment  Human and Physical Resources  Leading Change from Management  Linking Strategic and Operational Change  Coherence- consistent (clear goals) and consonant 27

WHAT IS PRODUCTIVITY MANAGEMENT?

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QUANTITY vs QUALITY

 

Quantity

Each citizen or customer usually only receives ONE product or service unit e.g. One ID book or One house or One frontline engagement to pay an account

Quality

The recipient of the One unit of goods or a service, judges the value of that One item/encounter to determine the quality of service through that experience hence influencing the perception of productivity

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SERVICES PRODUCTIVITY

 

Quality

is so closely entwined with more measurable outcomes in service provision that it becomes very difficult to isolate any one influence on productivity. The intangibility of

service satisfaction

, and therefore the importance of psychological outcomes (e.g. standard being met ) in the process of quality creation, represent major challenges in measuring and understanding service sector productivity in general.

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HOWEVER…..SERVICE PRODUCTIVITY

Service = Quality and Quantity of the Output Productivity Quality and Quantity of the Input

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PRODUCTIVITY Measurement

Multifactor Productivity

:

Multifactor = Output from the Operation Productivity ALL Inputs to the Operation

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PS EXAMPLE LABOUR PRODUCTIVITY

 A health clinic has 5 nurses attending to 250 patients per week. The clinic’s weekly wage costs are R150 000 and its overheads are R100 000 weekly. What is the clinic’s single factor labour productivity and its multifactor productivity ?

Labour Productivity = 250 Patients = 50 patients/nurse/week 5 days Labour Productivity= 250 Patients = 1.25 patients/labour working hour/per nurse (5days x40hrs) Multifactor Productivity= R250 000 Weekly Costs = R1000 per patient per week 250 patients This means that if the 5 nurses attended to 300 patients at R250 000 per week, Labour Productivity would increase and unit costs reduced 33

MEASURING SERVICE PRODUCTIVITY

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MEASURING TOTAL SERVICE PRODUCTIVITY



Labour Productivity

 Relationship between GDP and cost of salaries  

Performance Productivity

 Measuring whether the outputs and outcomes have been met in the specified time with the most efficient resource utilisation  E.g. In a 40 hr week you work 8 hours a day and complete certain phases of your projects way before schedule. You are able to do more than planned

Operational Productivity

 The operating environment has a direct impact on how you are able to perform i.e. ergonomics; physical location and layout; functional resource allocation e.g. a doctor at a hospital 35

Measuring and Managing Public Service Productivity:



OPTION A:

Output/Input Approach

(OUTPUT) Output Indicators (2013) (INPUT) Budget (2013)

Number of output indicators in Departmental APP Number of output indicators in Departmental APP achieved

Output ratio (Deliverables)

150 110 Total Annual Budget

0.73 (73%) Input ratio (Budget)

R800 000 000 Total Annual Expenditure R650 000 000

0.81 (81%)

Measuring and Managing Public Service Productivity

Macro Level Productivity Calculation:

Output ratio ∆ Output Input ratio ∆ Input

P.

∆ P.

2013 0.73

0.81

0.9 (90%) 2014

0.46

-0.28

0.82

+0.1

0.6 (60%)

-0.3 (-30%)

2015

0.5

0.72

0.7 (70%)

+0.1 (+10%)

Measuring and Managing Public Service Productivity



Interpretation of Productivity Scores

High Productivity

Medium Productivity Average Productivity Low Productivity Unproductive

81-100%

70-80% 50-70% 35-49% 0-34%

Measuring and Managing Public Service Productivity



Assumptions: Output/Input

Assumptions If false, recommendation

Alignment between Strategic Plans, Annual Performance Plans (APPs) and financial reports Citizen feedback is included the implementation of APPs to ensure that service delivery is meeting the needs of citizens Mechanisms are in place to monitor and measure the quality of delivery consistent with the expectations of citizens Strengthen capacity to: -better institutional align and manage planning; -incorporate citizen inputs into planning -measure and manage service quality

Measuring and Managing Public Service Productivity



OPTION B:

Matrix Approach 

Quantity

and

Quality

measures are critical in measuring public service productivity.

 There must be detailed information on the

multiple factors

affecting both service

quality

and

quantity

, thus productivity.

Matrix Approach

 Step 1: Determine the weight for each sub- factor

Sub-factor

Labour Operational Performance

Total Weighting

20% 40% 40%

100%

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Matrix Approach



Assumptions: Matrix Approach

Assumptions

The environment, operational systems and processes are in place that enable and support officials to optimise the use of resources (inputs) at their disposal.

Productivity can be improved by better management (better allocation of resources).

The emphasis is largely on people (officials and citizens).

If false, recommendation

The creation of a conducive including measures to fill vacancies, effectiveness.

environment improve infrastructure quality, and the implementation of set norms and standards for operational efficiency and

Discussions

• Share perspectives on productivity measurement & management in the Public Service generally.

• Make inputs on proposed measures.

the

THANK YOU

Access: Offering integrated service delivery Openness and Transparency: Creating a culture of collaboration Consultation: Listening to customer problems Redress: Apologizing when necessary Courtesy: Service with a smile Service standards: Anticipating customer needs Information: Going beyond the call of duty Value for money: Delivering solutions 44