Public Administration is beginning to take an Interest in its Output

An audit cannot be a direct guarantee of quality. It can only be indirect, by optimising conditions

[12.4.2005, TREND / Zuzana Horníková and Ján Záborský]

  
The British Ministry of Defence is the third largest defence branch in the world. Its annual budget is around 25 billion pounds and it has over three hundred thousand employees. Eight years ago, it began thinking about whether it is at all capable of precisely defining the required output of its work and naming what enables it to be carried out successfully; whether it works in unison to meet its targets or whether employees are able to identify to what extent they influence the work of others. “Do we have our own strategy which meaningfully links all the partial activities and actions together?” the British Defence branch asked itself.
From questioning, it continued to making a decision that it must be in control of its performance. And improve as fast as possible change management and risk management. They went to seek advice in the private sector, too.
Since 2000, it has used the well-known Balance Scorecard system to define its goals and measure how far they are being met. The executive director of the S&K Management Systems consulting company, Renáta Kiselicová, mentions this story as an example of how even a strong state institution can successfully take on board procedures from the private sphere, and thus improve its performance as a result.
Even Slovak public administration organisations – ministries, institutions, local government – are gradually beginning to ask the same questions as the British Ministry of Defence. The pressure is on from several sides for them to begin to focus on performance; and no longer only from more and more demanding citizens and businessmen who come into contact with them.
They are also partially forced into this situation by the Ministry of Finance via legislation which is gradually introducing programme budgeting into the regular circuit of approving the state budget, i.e. budget preparation according to measurable goals. From this year, it is forcing state administration and local government not only to think in terms of January to December, thanks to the obligation of budgeting for several years.
To start with, over-employment
S&K carries out process audits at several Slovak ministries. They too are aware that they have room for improvement. Their identification of the problem usually begins with the simple discovery that they are probably suffering from over-employment to a greater or lesser extent. They carry on by saying they want to solve the problem, but don’t know how.
Last but not least, they are fed up of hearing all the time of how a process audit helped the finance department and answering the question of when they are going to do something similar themselves. So they call in specialists who straighten up their process, organisational structure and relations.
As a reminder, the finance department sacked 250 people and shut down 44 sections after the process audit two years ago. It removed comical vicious circles, where bureaucrat A worked for bureaucrat B, he worked for bureaucrat C whose superior was bureaucrat A. The money saved was used to provide better financial rewards to employees. After rationalisation, their salaries rose to an average of 28 thousand crowns per month. And the results measured from their work, the analytic output of the Ministry of Finance are at present at the highest quality in all the state administration.
Audit as a prerequisite
Is then an audit, whether it be an organisational, personnel or IT audit, the right way to improve the quality of public administration output? “An audit can influence the quality of the process which produces the output. It is in this intermediate way that it also influences the quality of this output” describes Pavol Boroš, managing partner at S&K.
So an audit does not influence whether the employees have really demonstrated all the conditions, knowledge and abilities necessary to carry out their work in a truly high quality way in optimised conditions. A causal relation between an audit and bureaucrats’ better quality output does not exist, even though the probability of better work results is significantly increased.
Mr. Boroš explains this in more detail with regard to preparing the state budget. The audit shows how to optimise work, how many people should take part and for how long. Thus prerequisites are created for the budget to be prepared in an efficient way and without pointless waste of public resources. But this does not automatically have to mean that it will really be of quality.
Consulting companies are able to designate not the only the processes, but also all the organisation’s partners and their mutual relations. The tax office ordered S&K’s services for this reason. Consultants advised it to stop perceiving taxpayers as its main clients.
“We see them more as service providers. The client of the tax offices should above all be the state,” thinks R. Kiselicová. She justifies this by stating that adhering too much to the taxpayer as client is to the detriment of the efficiency of the office’s services. There are many offices in S&K’s opinion. Even more so when it is possible to submit tax declarations in electronic form, thus lowering the frequency of contact between citizens and the offices.
CAF provides feedback
At approximately the same time as the Ministry of Finance went through an audit, the Office for State Service began to implement the project of Common Assessment Framework, known under the abbreviation CAF. Both activities follow a similar goal: to help public and state institutions render their activities more efficient and of higher quality. They both use different methods; according to P. Boroš, they do not exclude each other, but rather complement each other.
CAF is a method which allows the organisation to assess itself continuously. It follows nine areas, identifies their strong and weak point and suggests points to be improved. After a repeated assessment, the progress is written in the report.
Then it is checked by an external assessor. CAF is a simplified versions of the EFQM model of excellence. The European Union is strongly promoting it, and the Slovak government has also taken it seriously.
With this decision, Slovakia is one of the few European countries which has defined the gradual implementation of the CAF model in public administration as an obligation. This year, twelve institutions decided to take it on, the first being the local government represented by the Town Hall in Martin and the Office of the Žilina self-governing region.
At the moment, the Ministry of the Economy is the furthest ahead in its use. It presents itself at international conferences as a positive example from Slovakia. However, in its opinion, it is still too early to affirm that clear benefits are being felt not only by employees, but also by citizens.
Pick up the telephone in the meantime
“If CAF, and EFQM, are done well, they measure the organisation in terms of given criteria. They provide quality feedback on what needs to be improved,” P. Boroš assesses the benefits of these systems. When the organisation repeats the assessment after a certain time lapse, it realises where it has progressed in the meantime – if it is improving or not.
In his opinion, the problems arrive in the intervals between individual assessments. At this time, the deficiencies discovered must be worked on. This means not only finding them, but knowing what to do with them, and above all how to carry out these steps in practice. This is where, according to P. Boroš, CAF and EFQM run out of steam. On the other hand, it’s the right time to pick up the phone and order an audit.
What can the public office find out, for example, after a call to S&K’s consultants? How to optimise the number of employees and thus eliminate centres of low productivity and efficiency. How to unburden bureaucrats who have too much work, and then don’t have the time to look for possibilities of improvement. By analysing the processes, the consultants recommend how to organise work effectively. “This has a direct influence on the quality of the output of each employee,” stresses P. Boroš.
CAF, EFQM and audits will only be successful, according to him, when the organisation’s leadership also accepts them at full value. If it is prepared to carry out painful changes, the institution may improve. If the institution or ministry does not have such people at its head, the time and investments spent on CAF or EFQM are a pointless waste of energy.
Photo – Miro Nôta