Government's administrative silos have spawned two parallel worlds centered on performance that exist independent of each other. One world focuses on strategy, priority goals, metrics and evidence-based decision-making. The other focuses on working with managers and employees to improve their performance. Both are valid and essential, and both look to the same end results. Each has its own experts, literature, jargon and conferences. But surprisingly, they rarely interact.
That does not benefit good government. Neither group can realize its potential value without the other.
In the business world, the two bodies of knowledge are blended, viewed simply as elements of management. Measurement is basic; new metrics are produced daily at all levels. Goal-setting is the basis for planning and for progress discussions throughout the year. That process cascades to each level of management. At year-end, performance relative to goals is the basis, along with company financial results, for determining incentive awards. The awards reinforce individual accountability. This has been standard practice in the private sector for decades.
That's not the way it usually works in the public sector. In an article published in 2015 that focused on performance management in local government, David Ammons of the University of North Carolina School of Government described performance measurement as a tool that, by itself, is rarely used to improve workforce performance. Performance management, on the other hand, "is not a tool, it is an act -- an act of management," Ammons wrote.
Ammons' article should be read by everyone relying on metrics to plan and monitor performance in government. He goes on to list some of the "key rules" governing performance management: "Goals must be clear; performance measures must be relevant, actionable, and used for management purposes, not just for reporting; and executives must engage in responsible oversight while granting decision making authority to program managers and supervisors."
My experience in the private sector, along with my loyalty to the "people world" of human resources, give me a somewhat different understanding of what's needed for effective performance management.
First, the goal should be to delegate decision-making authority not just to managers and supervisors but all the way down to the level where the work is actually done. In a healthy work environment, employees at all levels can be trusted to make job-related decisions; for the most part, they want to make their employer successful. That is a message from all of the rankings of "best places to work" and discussions of employee engagement.
Second, accountability has to have consequences. That is central to why companies link year-end incentive awards to goal achievement. Outstanding performance should be rewarded (although cash is not the only option); poor performers need to be warned that their shortcomings will at some point affect their job security.
And third, the use of metrics and goals works best when employees are involved in defining goals. It's the commitment and the autonomy to work at achieving goals that explains high performance. As the research shows, delegation, trust and agility are important at every level. Increasingly companies operate with teams that meet with a manager only occasionally. For most day-to-day actions, the workers are self-managed. Metrics are used to monitor their progress.
The problems with government's use of metrics are illustrated by the experience of a major federal agency, one with operations across the country. A headquarters office has the responsibility for developing the metrics, and it has developed a long list relevant to national and local performance. At year-end, the results are linked to salary increases. On paper it appears to be consistent with good practice.
However, it's gone off the rails. The list of metrics applicable to each job is long: The combination of national and local measures exceeds 20. (Keep in mind that the rule for goal-setting is never more than five or six; as the number grows, each receives reduced attention.) The goals are better understood as standards dictated by the head office; employees are not involved. Headquarters insists on centralized, top-down control, ignoring local operational differences. Employees are too far removed from national performance to believe they have any impact. There is also a shared belief that year-end results are manipulated to limit the incentive payouts.
Employee morale could not be lower. As with far too many government agencies, employees retire as soon as they are eligible. And while It cannot be measured, there are employees who "retire on the job."
Government can do better, and some jurisdictions are. Tennessee's transformation of its civil-service system, as explored in a Governing article, included an overhaul of its performance evaluation system that goes a long way toward bridging the divide between metrics and management. The state now has performance outcomes for every job that follow the acronym "S.M.A.R.T." -- specific, measurable, achievable, relevant and time-sensitive.
Here is how the state's human resources commissioner, Rebecca R. Hunter, describes its progress: "Each Executive Branch employee has a performance plan with S.M.A.R.T. work outcomes that are cascaded from and aligned with the Governor's key priorities and the department's strategic and operational goals." The commissioner is a member of the governor's cabinet, and her experience as a CPA gives her credibility in performance discussions.
Keep in mind that this is led not by the budget office or outside consultants, but from HR. Investing in getting performance management right pays off.