Q: What is important in measuring public services performance?
A: Measuring performance in public sector organizations has many benefits. It allows managers to set up mechanisms to evaluate, control, budget, motivate, promote, celebrate, and improve their strategic decision-making.
The core use and benefit of setting up performance measurement systems in public sector organizations are: Prognosis, Diagnosis, Motivation, Legitimation, and Learning and Improvement.
In layman’s terms, public sector key performance indicators (KPIs) serve two important purposes: 1. Report important information to citizens. 2. Provide information that directly describes the government’s activities.
Therefore, without understanding and evaluating KPIs, governments cannot fulfill their commitment to responsible spending and transparency, and the public cannot verify if the required services are being adequately performed.
In most organizational structures, KPIs have two notable attributes: 1. They determine what is important to the success of the organization. 2. They indicate the expected level of performance by attaching a target to each metric.
Last but not least, how do we identify the most meaningful public sector KPIs?
Identify the key value drivers (research studies). This refers to identifying all stakeholders categories properly (internal and external) and conducting a stakeholders analysis to reveal what aspects are of interest. What matters most for citizens in terms of public transportation? Is it the arrival on time? The frequency of arrivals? How about the employees–what do they think is critical for the operations? What data is needed for optimizing processes and adjusting working flows to deliver the best customer experience?
Choose a balanced set of KPIs (efficiency versus effectiveness, process versus impact measurement, quality versus quantity). KPIs should be used in context and in correlation. For this reason, a successful scorecard or dashboard looks into performance from various perspectives.
Balance between simple and complex measurements. While many KPIs that capture impact may be survey-based and require significant resources for data collection and reporting, some KPIs can be tracked in real-life with the help of digitalization and enable proactive management.
Solid background in working with process and performance management.
Former consultant for the public sector – Ministry of Community Development – UAE
Former business excellence and process reengineer at Zain telecom – Jordan
Passion for knowledge sharing and supporting the growth and improvement of organizations and individuals.
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This feature was first published in the Ask Our Experts section of Performance Magazine Issue No. 24, 2023—Public Sector Edition. It offers deep dives and practical insights into the public sector’s performance in the post-pandemic era. To download the free digital copy, visit the TKI Marketplace. You can also purchase an additional printed copy via Amazon.
In today’s dynamic business landscape, enhancing employee performance is crucial for sustained success. To build high-performing teams, it’s important to establish the right framework and processes for performance measurement, including the selection and deployment of tools like key performance indicators (KPIs). But how can organizations successfully unlock employee potential through performance measurement?
Here is how renowned company Adobe transformed its employee performance strategies to obtain outstanding outcomes.
Case Study: Adobe
Adobe’s transformation journey is a testament to the potential of strategic performance measurement and KPIs. Adobe has faced issues with its yearly performance evaluation process. These were:
Employees were frustrated with annual performance reviews as they found the process cumbersome and bureaucratic.
The process created barriers to teamwork since the experience of being rated and stack-ranked for compensation left many employees feeling undervalued.
Adobe estimated that a total of 80,000 hours of its managers’ time was required each year to conduct all of the reviews, the equivalent of nearly 40 full-time employees working year-round.
Adobe realized that it should not wait until the end of year to share feedback. So, the company made a surprising change that improved employee engagement and transformed the company culture.
Employee-centric approach: Adobe’s departure from traditional performance reviews towards a more frequent and less formal “check-in” process demonstrates its commitment to an employee-centric approach. These regular discussions—done at least once a quarter—provide a platform for managers and employees to engage in meaningful conversations about expectations, growth, and development. This shift reflects Adobe’s recognition that empowering employees with continuous feedback and opportunities for improvement is more effective in driving performance excellence than the conventional annual review model.
Setting clear, measurable goals: The new strategy adopted by Adobe focused on providing its staff with specific, measurable goals. Employees could clearly understand what was expected of them and how their performance would be assessed because these goals were cascaded down from the organizational and departmental goals and aligned with each other. Companies that have aligned goals tend to outperform organizations that lack a direct connection between top company priorities and employees’ individual aims.
Real-time performance insights: Adobe enabled its managers to give employees real-time insight into their performance by integrating technology. Adobe launched a digitally-enabled check-in, providing all employees and managers with a web-based destination to document their goals, development, and growth. Individual goals are documented in a centralized place, reviewed regularly, and can be updated in real-time by managers and employees alike. All of this made it possible for timely feedback and course correction, ensuring employees stayed on track with their objectives and KPIs year-round.
The results of the transformation were spectacular and resonated with employees—employee attrition dropped by 30% while involuntary departures rose by 50%. This change allowed managers to give more timely and useful feedback while empowering employees to take responsibility for their own advancement. The employees thus felt engaged, valued, and aligned with the company’s goals.
What are the key takeaways from Adobe’s case? Performance measurement best practices should always include the following:
Alignment with organizational goals: A strong performance measurement approach starts by matching team objectives and individual objectives with the organization’s overarching mission. Employee performance becomes a key factor in the organization’s success when they are aware of how their work supports corporate objectives.
Keeping qualitative and quantitative metrics in balance: Effective performance measurement goes beyond simply counting numbers, as it needs a comprehensive understanding of an employee’s contributions and their influence on the expansion of the business. This is made possible by incorporating qualitative elements like engagement, collaboration, and innovation.
Continuous feedback and growth: Many businesses are using continuous feedback loops instead of the traditional annual reviews. Periodic performance reviews and regular check-ins encourage ongoing conversations between managers and employees, facilitate growth discussions, and identify areas that need improvement.
In conclusion, the modern business landscape demands a strategic approach to unlocking employee potential. Performance measurement and KPIs are not just tools but pathways to aligning individual aspirations with organizational goals, combining qualitative and quantitative insights for a thorough understanding of employee contributions, and motivating continual improvement through timely feedback. By adopting best practices and an employee-centric approach, businesses may begin on a journey that empowers their staff, inspires innovation, and drives them to sustainable success in the dynamic global marketplace.
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This article is written byMuhammad Ali Moustafa isa Business Management Consultant at The KPI Institute. He is a Certified KPI Professional (C-KPI) and Certified Performance Management Systems Audit Professional (C-PA). He has diverse professional experience in which he had the opportunity to work on advisory projects with different organizations, ranging from startups to multinationals.
Designing and implementing a Performance Management System (PMS) based on performance measurement tools such as key performance indicators (KPIs) is a thorough step-by-step process. It requires effective management of all the phases of the implementation process and proper allocation of responsibilities to all the stakeholders involved. With this, the KPI implementation project plan lays emphasis on conducting KPI selection workshops.
Whether or not the PMS within your organization is comprehensive, KPIs can be measured across organizational layers: Corporate/Organizational, Divisional, Departmental, or Individual/Employee levels in accordance with the organizational context. For these performance indicators to be measured in standardized tools, such as a balanced scorecard, they need to be selected, and such selection should occur during dedicated meetings.
Such meetings require the attendance of specifically allocated stakeholders to provide constructive insights and foster a corporate community culture based on continuous improvement. As a line of practice, the participants of these workshops hold positions, such as department heads, strategists, performance analysts, members of the performance management office, and allocated members of the Board, all based on their availability. Note that other members could attend the workshops as per company practice. Attendance at these important meetings requires an invitation, though.
The invitation is a crucial, pre-workshop phase, as it sets the tone, pace, and mindset of the delegates who will join the event. Such invitation is generally in the form of an email with quite some content and attached materials. The email aims to provide contextualization and reasoning behind the request to certain members of the organization to attend the workshops. It is a request that comes from the Strategy Office or the Performance Management Office or whoever oversees the Performance Management practices in the organization, at least two to three weeks in advance of the date of the event.
What should be included in the KPI selection workshops invitation?
Brief introduction about the upcoming workshop;
Logistical information such as date, time, and location of the event;
Detailed KPI selection workshop agenda;
Reading materials and corporate documentation attached
What are the key documents to be attached to mentally prepare our participants and make this workshop a success?
As a line of practice, it is recommended to share educational materials, prepared by the Performance Management Office, related to KPI selection, KPI Alignment practices, and Performance Measurement and Management tools. The delegates, whether or not they are practitioners in the field, are invited to go through the materials;
Strategic and Performance Management tools linked to previous performance cycles, such as Corporate Strategy Plan, Organizational Scorecards, Dashboards, and Portfolio of Initiatives, must be included.
In certain organizational contexts, a written note from top management and C-Suites may be added in order to highlight one factor: The involvement and support of top management in the design and implementation of the framework. This note could be very beneficial buy-in wise as well.
Setting the right tone and mindset in preparation for the workshop is very much advised. The delegates, especially after the workshops occur, will act as champions in disseminating knowledge and replicating the KPI best practices in their respective departments. Furthermore, it will support the ultimate purpose of securing the much-required buy-in from middle managers and employees across departments towards the PMS design.
If you would like to learn more about KPI selection practices and the follow-up activities to the KPI selection workshops, we kindly invite you to sign up for The KPI Institute’s Certified KPI Professional and Practitioner training course. It will lead you through all the phases of the KPI implementation project plan.
A well-functioning KPI measurement framework is more important then ever. In the fast-changing post-COVID-19 environment, organizations without a well-designed performance management system are not able to collect data-driven and real-time feedback, which is more important than ever because organizations need to make quick decisions as they respond to new challenges.
Organizations with no formal KPI measurement framework in place might consider implementing KPIs, and thisprocessstarts with a KPI implementation project plan.
The importance of a KPI implementation project plan
A KPI implementation project plan provides a structure for the implementation of an organization’s performance management system. Once the project plan is set, all types of activities would have a clear deadline and designated responsibilities.
Because a KPI implementation plan lays out all pertinent details, it promotes effective communication among the stakeholders of the project and reduces the impact of the project implementation gaps. Some of these gaps are the lack of buy-in from key stakeholders, unrealistic deliverables, and the inefficient assessment of organizational resources.
A good plan also serves as a compass for employees and other stakeholders in uncertain times because it guides stakeholders/employees towards reaching the strategic objectives of the organization.
Project planstages
The most common elements of a KPI implementation project plan are key activities, deadline, responsibility, status, and comments.
A KPI implementation project plan must be aligned to the organizational strategy and objectives. Before the implementation starts, a meeting with the stakeholders of the project should be organized to discuss their expectations and make sure that everybody is on the same page. After the plan is developed by the project team incoordination withthe project manager, the resource assessment of the project needs to be created. Then, another meeting withall employees is necessary in order to share the vision and benefits of such a project and delineatethe first tasks to be finalized.
The second phase is the actual implementation of the performance management system. Start with proper training for the stakeholders to establish a common languageand to avoid any misunderstanding. The appropriate KPIs should be selectedin a KPI selection workshop. Then, they should bedocumented using a pre-defined, standardized template. Moreover, the data should be gathered and reported by the data custodians. The report should be presented with good visuals that are easy to interpret. Thiswill help ensure a clear and effective decision-making process.
During the post implementation assessment phase, aperformance review meeting should be conducted to gather feedback from internal stakeholders and analyze the situation and the progress of the result. It is also important to evaluate the possible corrective actions to be addressed in the performance management system.
KPI implementation project plan example:
Conclusion
In order to arrive at the benefits of a well-functioning KPI management system, companies need to understand how to efficiently implement it and to ensure that all employees have a clear picture of the whole system.
The value of Big Data has found its way to the core of many organizations.NewVantage Partners’ 2021 executive survey showed that 99.0% of the companies they surveyed are investing in data initiatives while 96.0% attest that Big Data and AI efforts were generating results.
However, working with Big Data is not easy for all companies. The survey revealed that 92.2% of leading companies consider culture (people, process, organization, and change management) as the top reason why becoming a data-driven organization remains challenging.
Organizations should recognize that integrating Big Data into performance management would allow them to further improve their performance , make strategic decisions, and achieve higher efficiency in many areas of business.
How does that happen? First, it is important to know what Big Data is and what it is not.
Big Data is not about having a higher volume of data. IBM defines Big Data as “a way of harvesting raw data from multiple, disparate data sources, storing the data for use by analytics programs, and using the raw data to derive value (meaning) from the data in a whole new way.”
Mayer-Schönberger and Cukier, authors of “Big Data: A Revolution That Will Transform How We Live, Work, and Think,” wrote that Big Data can generate new insights and develop new forms of value in a manner that changes how people live.
The reason is that Big Data can reveal trends and patterns. In an ever-changing business landscape, organizations working with Big Data would allow them to make decisions based on facts. This echoes what Geoffrey Moore, a famous American organizational theorist & author of “Crossing the Chasm,” was quoted saying: “Without big data analytics, companies are blind and deaf, wandering out onto the web like deer on a freeway.”
Big Data’s Role in Performance Management and Measurement
The value of Big Data lies in improving the performance and processes of an organization.
For instance, Big Data can provide insights into customer preferences. Understanding customer preferences and using them as a basis for strategies can lead to increased sales. With better forecasting, Big Data can guide companies in determining where they need to invest. A manufacturing company would be able to accurately identify the equipment that needs replacing. Moreover, the automation of high-level business processes can make organizations more effective and efficient.
In the conference paper, “Is Big Data the Next Big Thing in Performance Measurement Systems?” the authors concluded that the presence of a variety of data could expand the horizons of PMSs due to the application of different kinds of metrics. The applications of Big Data in PMS are in planning, controlling, and improving business performance as well as in strategic planning, controlling operations, and processes improvement.
The authors found the reasons for using Big Data and PMSs similar, and they revolve around decision-making and action-taking. “PMS supports decision-making [by] providing meaningful and appropriate data [developed] through a series of activities, such as analyzing and interpreting data from past actions to influence the future performance.”
Big Data in Action
The success ofNetflix, a streaming service company, is attributed to their usage of Big Data. For content development, their objective is to determine what their audience would want to watch next. To analyze the behavior and preferences of their over 140 million subscribers, Netflix used metrics, such as “What day you watch content,” “Searches on the platform,” “User location data,” “When you leave content,” “The ratings given by the users,” and even “Browsing and scrolling behavior.”
Netflix also uses Big Data in addressing challenges in production planning, such as determining shoot locations and arranging a shoot schedule. With prediction models, Netflix can minimize their efforts and reduce their expenses.
Xerox, the world’s largest provider of digital document solutions, once faced a problem with its workforce and needed to cut employee training costs and lower the premature attrition of its employee pool. With the help of Big Data, the company executed a predictive recruiting program in order to assess and filter applicants. Big Data and Big Data analytics helped them recruit people who have more technical skills and are more likely to stay longer with them. This means lower cost of training. The reduced attrition successfully helped the enhancement of Xerox’s bottom line.
Big data is a new source of competitive edge for any organization as it permits them to provide faster and more intelligent decisions, makes information more transparent, generates unprecedented insights into market situations and customer behavior, and optimizes business performance.
If you would like to discover new knowledge and the practical application of best practices used in analyzing statistical data, sign up for The KPI Institute’s Data Analysis Certification.
