THE LATEST EDITION

November 2018
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Governments plans for public sector reform

At the heart of the Government’s plans for public sector reform is the need to reduce costs, and improve the accountability and quality of the services it delivers. In April, Chancellor Alastair Darling announced plans to make £9 billion in efficiency cuts each year by 2013, in addition to the £5 billion announced in the pre-Budget report in November 2008.

Many public sector organisations have responded already by making redundancies. Around 7,000 jobs have been lost in local authorities, for example. Managers have a huge challenge ahead- they need to maintain the skills, talent and performance of their workforce, and at the same time, increase efficiency and productivity in the face of toughfinancial constraints.

We all know that efficiency is a measure of resources expended relative to the outputs produced by them, and improved efficiency requires a reduction in the running costs of services over time. But to achieve efficiencies, public sector organisations must have greater administrative flexibility.

Given the complexity of measuring efficiency and quality, many approaches assess work processes or institutional arrangements that are reasonably thought to contribute to efficiency and service quality. While various tools have been developed to measure specific services,
organisations now need to set criteria that capture key elements of
performance in relation to:

Financial management
Human resources management
Information technology management
Capital management
Managing for results

Key indicators are essential in the following four areas: record management, internal audit, performance appraisal, and project evaluation. And within those four areas, three intermediate dimensions of performance are needed: “results focus,” accountability and employee
morale.

Managers in the public sector have their work cut out establishing these new measures of performance and evaluation processes, while ensuring they are focused on results. Other potential challenges overburdened managers may face include the need to redistribute job roles, delegate additional responsibilities, achieve more with fewer resources and, in
many cases, make difficult decisions about redundancies.

One simple, effective and often overlooked approach to saving money and improving employee performance is to address gaps in employees’ knowledge and skills. However, the main difficulty for many managers in tackling underperformance is that they lack up-to-date and accurate information concerning the skills, competence and confidence of their employees. Without this, it is difficult for them to understand how to best utilise their staff, reassign roles or address knowledge gaps.

One solution is to introduce customised knowledge development programmes based on individual employee assessments. Such assessments will provide mangers with vital insight into the skills, competence on the job and confidence of their staff. Assessments should be carried out regularly, as most employees move through various jobs and ranks during their
career. Without regular testing, managers cannot be certain employees understand their changing roles or if they require further coaching, mentoring or training.

Such assessments highlight the strengths, weaknesses and knowledge gaps of individuals immediately, and the results provide managers with the information they need to identify the most appropriate intervention to address any knowledge gaps.

With this information, individually tailored employee training and development programmes can be introduced to address an employee’s specific needs. This approach tailors learning and development spending and reduces the need for -one size fits all- programmes which can be
expensive and ineffective.

An organisation’s top performers can also be identified. These are the ‘go-to’ people in the department who are a consistent and reliable resource for other employees. Identifying these individuals will help managers improve efficiency and productivity in several ways. When faced
with difficult expense reduction decisions, assessment programmes help to determine objectively the capability of all employees. They also identify which employees have the potential to deliver training to their peers or are able to coach and mentor others. When faced with the need to cut services, managers will know which individuals have the potential
to be re-deployed elsewhere.

If all government departments were to identify and address employee skills and knowledge gaps, overall efficiency would improve significantly. Last year, a report from the industry analyst firm IDC, entitled -Counting the Cost of Employee Misunderstanding, showed that
one in four employees do not understand certain aspects of their job role and that major knowledge gaps remain unaddressed in many organisations. A misunderstanding can range from misinterpreting a policy, process or job function, to a combination of all three. These
kinds of misunderstandings are inevitable, but they can also be incredibly costly – the report estimates that UK and U.S. businesses lose £18.7 bn a year as a result of employee misunderstandings and also suffer damaged relationships with key customers and clients.

With mounting pressure to reduce costs, now is the time for public sector organisations to tackle employee underperformance, and for managers to take the lead on it. Assessments can be the first step in objectively identifying the interventions needed to help improve efficiency and morale at many levels within government.

Cognisco is a global provider of intelligent knowledge development and assessment solutions. The company works in over 150 countries in 70 different languages with its international headquarters in the UK.

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