Performance Management in Government

(Challenges, Possible Solutions and Lessons of International Experience)

Dr. Prajapati Trivedi

Secretary, Performance Management
Cabinet Secretariat
 Presentation Outline
• Perceptions about Government Performance

• Explanations about Government Performance

• Meaning of Government Performance

• How to Improve Government Performance

• International Best Practice and Options

• Lessons of Experience – Summing Up

 Perceptions about
Performance of Government Agencies

Government
Government Agencies
Agencies have
have not
not delivered
delivered
what
what was
was expected
expected from
from them
them
 Presentation Outline

Perceptions about Government Performance

• Explanations about Government Performance

• Meaning of Government Performance

• How to Improve Government Performance

• International Best Practice and Options

• Lessons of Experience – Summing Up

 Problems of Government
Agencies - I
PARLIAMENT
FINANCE MINISTRY
POLITICAL NON-POLITICAL
PLANNING MINISTRY
ADMINISTRATIVE MINISTRY EQUITY EFFICIENCY

MULTIPLE MULTIPLE
PRINCIPALS GOALS

FUZZY GOALS &

OBJECTIVES
Problem of Government Agencies
-II

“NOT ME”Syndrome
People

Public Enterprise Parliament

Government
 Symptom:
Performance Deficit Vs. Financial Deficit

Performance Deficit

Poor Performance Low Credibility

Financial Deficit
Lower Funding
 Presentation Outline

Perceptions about Government Performance

Performance
Explanations about Government

• How to Improve Government Performance

Determinants of Performance

20 %

80 %
 People

80 % 20 %
R
E
Leader S
T

Determinants of Performance
Determinants of Performance

People
20%

Sys tem
People
System
80%
Determinants of Performance
People

80 % 20 %
Leader Rest
16% 4%
Sys tem
Leader
Res t
System
80%
What can be done to solve the problem?

Government
Government Agencies
Agencies have
have not
not delivered
delivered
what
what was
was expected
expected from
from them
them

Reduce
Reduce Quantity
Quantity of
of Increase
Increase Quality
Quality of
of
Government
Government Government
Government

Privatization Traditional Trickle-down Direct

Approach Approach
Civil Service Reforms
 Increasing Quality of Government

Trickle Down Direct

Approach Approach

Performance Agreement Client Charter

Quality Mark
E-Government
Enabling E-Procurement
Environment
ISO 9000
Peer Reviews
Knowledge Management
 Sample
Performance
Agreement
From
USA
Performance
Agreement

between
The President of USA
William Jefferson Clinton
and

The Secretary of Energy

Hazel O’Leary
 Sample
Performance
Agreement
From
New Zealand
 Sample
Performance
Agreement
From
Malaysia
 Sample
Performance
Agreement
 Sample
Performance
Agreement
 Problems of Government
Agencies - I
PARLIAMENT
FINANCE MINISTRY
POLITICAL NON-POLITICAL
PLANNING MINISTRY
ADMINISTRATIVE MINISTRY EQUITY EFFICIENCY

MULTIPLE MULTIPLE
PRINCIPALS GOALS

FUZZY GOALS &

OBJECTIVES

A SOLUTION

Performance Agreement
 Problems of Government
Agencies - II

“NOT ME”Syndrome
People

Public Enterprise Parliament

Government

A SOLUTION

Performance Agreement S
Why the Focus on Performance ?
• First general point
– The power of performance management is now
widely recognized.
The Power of Performance Measurement

• What Gets Measured Gets Done

• If you Don’t Measure Results,You Can’t Tell
Success from Failure
• If You Can’t See Success, You Can’t Reward It
• If You Can’t Reward Success, You are Probably
Rewarding Failure
• If You Can’t See Success, You Can’t Learn From
It
• If You Can’t Recognize Failure, You Can’t
Correct It
• If You Can Demonstrate Results, You Can Win
Public Support
 Presentation Outline

Perceptions about Government Performance

Performance
Explanations about Government

How to Improve Government Performance

• Meaning of Government Performance
Meaning of Performance
 What is meant by the term:
PERFORMANCE OF GOVERNMENT AGENCIES?

• Ex-post versus Ex-ante Performance

• Managerial versus Agency Performance

• Partial versus Comprehensive Performance

s
 Ex-post versus Ex-ante
Performance Evaluation

Ex-ante Performance Evaluation is:

• based on comparison of achievements against agreed
targets
• typically involves a formal agreement
• most common in professionally run organizations
 Ex-post versus Ex-ante
Performance Evaluation
Ex-post Performance Evaluation is:
• based on selection of criteria by the evaluator at
the end of the year

• typically undertaken by researchers

• useful for future projects

• more comprehensive
 Ex-post versus Ex-ante
Performance Evaluation
Ex-ante Performance Evaluation is: Ex-post Performance Evaluation is:
• based on comparison • based on selection of
of achievements criteria
criteria by
by the
the
evaluator
evaluator at
at the
the end
end of
of
against agreed targets
the
the year
year
• typically involves a • typically undertaken
formal agreement • typically undertaken
by researchers
• most common in by researchers
• useful for future
professionally run • useful
projectsfor future
organizations • projects
more comprehensive
• more comprehensive
 What is meant by the term:
PERFORMANCE OF GOVERNMENT AGENCIES?

• Ex-post versus Ex-ante Performance

• Managerial versus Agency Performance

• Partial versus Comprehensive Performance

 Managerial versus Agency
Performance Evaluation

Agency Performance Evaluation is:

• based on observed performance of the agency
 Managerial versus Agency
Performance Evaluation
Managerial Performance Evaluation is:
• calculated by adjusting agency performance for
factors beyond the control of the management
(government officials):
 Managerial versus Agency
Performance Evaluation
Managerial Performance Evaluation is:
• calculated by adjusting agency performance for
factors beyond the control of the management
(government officials):

Agency Managerial Exogenous

+
Performance = Performance - Factors
 Managerial versus Agency
Performance Evaluation
An Heuristic Illustration

Change in Change in Exogenous

+
Agency
Performance
= Managerial
Performance - Factors

- 100,000 +75,000 -175,000

+
Hospital
Beds
= Hospital
Beds - Hospital
Beds

Impact of Budgetary Cuts

 What is meant by the term:
PERFORMANCE OF GOVERNMENT AGENCIES?

• Ex-post versus Ex-ante Performance

• Managerial versus Agency Performance

• Partial versus Comprehensive Performance

 Partial versus Comprehensive
Performance Evaluation

• Partial Performance Evaluation is:

– based on selected aspects (or activities) of the agency

• Comprehensive Performance Evaluation is:

– based on all activities of agency
 A Taxonomy of
Performance Evaluation Approaches
Managerial Agency
Performance Performance
Performance

Cell # 1
Ex-ante

Performance Cell # 2
Agreements
Performance

Cell # 3 Cell # 4
Ex-post

Impact Studies
Best Practice Methodology
 A SOLUTION!
PERFORMANCE MANAGEMENT SYSTEM

Performance Performance Performan

Information Evaluation ce
System System Incentive
System

Criteria Institutional
(“How” to Arrangements
Evaluate) (“Who” Should
Evaluate)
 Performance Evaluation System

BEGINNING END OF
OF YEAR YEAR

Step 1 Step 2 Step 3 Step 4

Criteria Criteria Criteria Performan
Selection Weight Value ce
Selection Selection Evaluation
(Composit
e Score)
“FAIR” to “FAIR” to Negotiat
Officials country ed s
“FREELY”
 Example
Step 1
Criteria / Weight Target / Criteria Values
Success Indicators
Excellent Very Good Fair Poor
Good

100% 90% 80% 70% 60%

1 % Increase in number of primary .50 30 25 20 10 5

health care centers

2 % Increase in number of people .30 20 18 16 14 12

with access to a primary health
center within 20 KMs

3 Number of hospitals with ISO .20 500 450 400 300 250
9000 certification by December
31, 2009
 Performance Evaluation System

BEGINNING END OF
OF YEAR YEAR

Step 1 Step 2 Step 3 Step 4

Criteria Criteria Criteria Performan
Selection Weight Value ce
Selection Selection Evaluation
(Composit
e Score)
“FAIR” to “FAIR” to Negotiat
Officials country ed
“FREELY”
 Example
Step 1 Step 2
Criteria / Weight Target / Criteria Values
Success Indicators
Excellent Very Good Fair Poor
Good

100% 90% 80% 70% 60%

1 % Increase in number of primary .50 30 25 20 10 5

health care centers

2 % Increase in number of people .30 20 18 16 14 12

with access to a primary health
center within 20 KMs

3 Number of hospitals with ISO .20 500 450 400 300 250
9000 certification by December
31, 2009
 Performance Evaluation System

BEGINNING END OF
OF YEAR YEAR

Step 1 Step 2 Step 3 Step 4

Criteria Criteria Criteria Performan
Selection Weight Value ce
Selection Selection Evaluation
(Composit
e Score)
“FAIR” to “FAIR” to Negotiat
Officials country ed
“FREELY”
 Example
Step 1 Step 2 Step 3
Criteria / Weight Target / Criteria Values
Success Indicators
Excellent Very Good Fair Poor
Good

100% 90% 80% 70% 60%

1 % Increase in number of primary .50 30 25 20 10 5

health care centers

2 % Increase in number of people .30 20 18 16 14 12

with access to a primary health
center within 20 KMs

3 Number of hospitals with ISO .20 500 450 400 300 250
9000 certification by December
31, 2009
 Performance Evaluation System

BEGINNING END OF
OF YEAR YEAR

Step 1 Step 2 Step 3 Step 4

Criteria Criteria Criteria Performan
Selection Weight Value ce
Selection Selection Evaluation
(Composit
e Score)
“FAIR” to “FAIR” to Negotiat
Officials country ed
“FREELY”
 Example
Step 1 Step 2 Step 3 Step 4
Criteria / Weight Target / Criteria Values Achievement Raw Weighted
Success Indicators Score Raw Score

Excellent Very Good Fair Poor

Good

100% 90% 80% 70% 60%

1 % Increase in number of .50 30 25 20 10 5 15 75% 37.5%

primary health care centers

2 % Increase in number of .30 20 18 16 14 12 18 90% 27%

people with access to a primary
health center within 20 KMs

3 Number of hospitals with ISO .20 500 450 400 300 250 600 100% 20%
9000 certification by December
31, 2009

Composite Score 84.5%

 Importance of Composite Score
• It is a key concept:
– Any evaluation system without it is
incomplete

• It allows a rigorous link between the

evaluation system and an incentive
system

• It makes benchmark competition

between government agencies
possible
 Ranking of Government Agencies

RANK Government agency COMPOSITE PERFORMANCE

INDEX

1 Ministry of Health 1.13 Excellent

Excellent Poor
2 Ministry of Water 1.21 Excellent
  

3 Ministry of Housing and 1.55 Very Good

Public Works 1 2 3 4 5

4 Ministry for Railways 2.15 Very Good

5 Ministry for Civil 2.86 Good Legend

Aviation
Performance Rating
6 Ministry for Electricity 3.33 Good
Score
7 Ministry for Education 3.46 Good 1-1.50 Excellent

8 Ministry for Tourism 4.20 Average 1.51-2.50 Very Good

Ministry for Small 4.43 Average 2.51-3.50 Good
9
Industries
3.51-4.50 Average
10 Ministry for Energy and 4.66 Poor
Minerals 4.51-5.00 Poor
 Last Two Points
• Accountability for results trickles down

• Nature does not like vacuum

– If we don’t do it, someone else will do it for us

www.performance.org
For comments and further dialogue please contact:

Dr. Prajapati Trivedi

Secretary, Performance Management
Cabinet Secretariat

prajapati.trivedi@nic.in