Incentives to deliver
| by Peter Bebb 07 Nov 2007 Topic: Business, Public sector accounting |
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What gets public servants out of bed in the morning? Is it the prospect of improving public services, the colleagues they will work with or the need to earn a living? In the first of a two-part article, Peter Bebb looks at motivational theory and suggests some ways in which public sector morale and productivity could be improvedNew research shows how business performance is driven by workers' state of mind - and how managers, if they are not careful, can drive both down. Teresa Amabile and Steven Kramer's new research, based on more than 12,000 diary entries logged by knowledge workers over three years, reveals the dramatic impact of employees' inner work lives - their perceptions, emotions and motivation levels - on several dimensions of performance. Research into the psychology of the workplaceThink about your own most recent day at the office, and try to recall it in some detail. What would hidden observers have been able to learn had they been watching you go through that day? They might have read e-mails you composed, looked over the numbers you put into spreadsheets, reviewed the reports you prepared. They would have noted your interactions, in formal meetings or corridor encounters, with colleagues, subordinates and superiors, and listened in on a presentation you delivered. They would have heard your end of various telephone conversations, perhaps with customers, suppliers or consultants. Maybe they would have watched you sitting quietly for a while, looking off into space, jotting down a few notes. But would these observers really understand your inner work life that day? Of course not. In having those conversations and writing those reports, you were not only dealing with the task at hand. As events unfolded, you were also forming and adjusting perceptions about the people you work with, the organisation you are part of, the work you do, and even yourself. You were experiencing emotions, maybe mild states of satisfaction or irritation, maybe intense feelings of pride or frustration. And these perceptions and emotions were intertwining to affect your work motivation from moment to moment - with consequences for your performance that day. People experience a constant stream of emotions, perceptions and motivations as they react to and make sense of the events of the workday. As people arrive at their workplaces they do not leave their hearts and minds at the door. Unfortunately, because inner work life is seldom openly expressed in modern organisations, it is all too easy for managers to pretend that private thoughts and feelings do not matter. This is what the researchers mean by inner work life: the dynamic interplay among personal perceptions, ranging from immediate impressions to more fully developed theories about what is happening and what it means; emotions, whether sharply defined reactions (such as elation over a particular success or anger over a particular obstacle) or more general feeling states, like good and bad moods; and motivation - your grasp of what needs to be done and your drive to do it at any given moment. Inner work life is crucial to a person's experience of the workday, but for the most part is imperceptible to others. Indeed, it goes largely unexamined even by the individual experiencing it. People perform better when they are positive about their work. This comes about 'when they see their organisations and leaders as collaborative, co-operative, open to new ideas, able to evaluate and develop new ideas fairly, clearly focused on an innovative vision, and willing to reward creative work'. The most important factor in satisfaction, and therefore motivation, is knowing that one is productive in one's work. This takes clear and connected goals and feedback on progress. Next in importance is being treated decently as human beings. The value created by knowledge workers in particular is heavily influenced by the emotions swirling around in knowledge workers' heads. This will not be news to those of us who have seen productivity plummet when we encountered stress, depression or low self-esteem. Peter Drucker, in a 2002 Harvard Business Review article entitled 'They're Not Employees, They're People', wrote: 'Knowledge workers are not labour. They are capital. And what is decisive in the performance of capital is not what capital costs. What's critical is the productivity of capital.' Disincentives to deliver in the public sectorWhat currently prevents people from delivering in the public sector? Measuring the wrong things is a powerful disincentive to delivering the right things. The traditional way of measuring public service performance is through outputs. You can easily measure what you put into a system (inputs), what happens within the system (processes) and what comes out at the other end (outputs). For public services, however, the results that politicians, managers and citizens actually experience, such as changes in health or public safety, are more subjective and therefore less easy to measure by existing accounting methods. In education, for example, an output may be the number of children passing a particular examination. Yet parents and teachers may consider this to be an insufficient way of measuring success in education. They may wish to look beyond an ability to be examined to the outcomes of future employability and the appropriate social skills. The Comprehensive Spending Reviews, as the name implies, are about money rather than outcomes or services, and constitute a disincentive to focus on what needs to be delivered. The objectives in the Public Service Agreements (PSA) are often generic and about outputs or processes rather than outcomes. For example, the Ministry of Defence's (MoD) first PSA objective is 'achieve success in the military tasks we undertake at home and abroad'. Tasks are processes, not outcomes; and success is undefined and so unmeasurable. The PSA therefore creates a 'mission impossible' situation for the MoD, which in turn creates confusion and a disincentive to deliver. The targets in the PSA provide no indication of whether the desired result is likely to be achieved. For example, the Department for Environment, Food and Rural Affairs (DEFRA) will know whether it has achieved its target 'to reduce greenhouse gas emissions to 12.5% below 1990 levels in line with our Kyoto commitment, and move towards a 20% reduction in carbon dioxide emissions below 1990 levels by 2010, through measures including energy efficiency and renewables' only when it has reached its target. There is no predictor measure to tell DEFRA whether it is likely to achieve the target. The consequence of the absence of predictor measures is that people do not know whether they are on track, and so they can become demotivated. RelationshipsAn even more effective way of predicting whether an outcome is likely to be achieved is the explicit identification of the causal relationships between the desired outcome and the activities and resources required to deliver it. Then, if a prime cause is failing, it can be corrected in time to secure delivery of the outcome. However, there is no such analysis in the PSA, and the trajectories produced by the Prime Minister's Delivery Unit mislead because the past is not a cause of the future. Consequently, people only find out whether things are going wrong when they have gone wrong. Not being able to predict the consequences of your actions is a disincentive to taking action. Absence of an understanding of causality encourages people to manage symptoms rather than causes, and so make no real progress towards delivery because the symptoms recur. This inability to make progress is demotivating and becomes a further disincentive to delivery. Status, power, recognition and reward are currently independent of the delivery of outcomes, which creates a disincentive to focus on their delivery. Current approaches to public service improvement start with what exists and look for ways to improve it. This assumes that the existing organisation, processes and systems are valid, and inhibits thinking about radically better ways of delivering public services. The Transformational Government strategy, the Varney report, the Gershon review and the NHS National Programme for IT assume that IT will deliver better public services. However, history shows that IT enables change but does not bring it about; and the assumption that it does runs counter to the workplace research we quoted, diminishes the role of people, and builds a barrier to the delivery of transformational government. The Modernising Government white paper of March 1999 observed that 'some parts of the public service are as efficient, dynamic and effective as anything in the private sector. But other parts are not. There are numerous reasons for this, and some are common to many governments around the world:
Reference Peter Bebb is owner and director of Perendie, authors of Business Alignment. He has over 30 years' experience in corporate and business alignment, and is currently facilitating ACCA's use of business alignment. He can be contacted at peter.bebb@perendie.com | |