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26 April 2009

NEWS FOCUS ON KPI: SETTING MEANINGFUL TERGETS KEY TO MAKING IT WORK

NST
26/4/2009




The men and women of the civil service will ultimately determine whether a ruling party’s policies succeed or fail.


Key performance indicators are metrics designed to evaluate how well an organisation performs in meeting its stated goals. Launching his '1Malaysia, People First, Performance Now' agenda, Prime Minister Datuk Seri Najib Razak announced that KPIs would be instituted for Cabinet-level positions as well as the civil service they command. YONG HUEY JIUN and SHERIDAN MAHAVERA examine the promise and potential pitfalls of KPIs in that context.

PRIME Minister Datuk Seri Najib Razak's ambitious agenda to measure the performance of cabinet ministers with key performance indicators (KPIs) will require adaptability, resoluteness, a focused strategy and a steely determination to see it through.

The idea was greeted with "cautious optimism" at best, and cynicism at worst.

The Prime Minister's Department, appointed to oversee the formulation of these KPIs, is expected to face a series of challenges from the start.

Omar Mustapha, managing partner of consulting firm Ethos & Co, notes that "in business, it is pretty straightforward: as your stakeholders are the shareholders of the company, we can assume that shareholders are interested in the long-term financial success of the company".

But it's different with governments: "We need to start by understanding what is important for the country as well as the rakyat.

"Overall, this should be about making Malaysia a competitive and prosperous country that provides the rakyat with a high quality living environment, i.e. safe from crime, good healthcare access, etc.

"Various documents -- Vision 2020, the National Mission statement -- should be the guide for understanding national aspirations."

The government's KPIs, he says, "need to measure those metrics that have the most leverage in terms of impacting the identified national aspirations".

If, for example, the objective is to provide the rakyat with a quality living environment, what constitutes "quality" to the rakyat?

"It may be about improving public safety, better transport infrastructure, more affordable housing, better healthcare or cleaner environment."

The outcome KPI, therefore, must apply to the minister and government agencies concerned with this particular objective.

Omar cautions that there must not be too many KPIs, with a balance between near- and long-term goals, and between what is important for national competitiveness and what the rakyat wants. Getting the KPIs right, he warns, depends on setting meaningful targets.

"The worst thing that can happen is that the government publishes data that show that they have met their targets, but the rakyat knows this is incongruent with what is actually being experienced on the ground."

Critical to success, he says, is ensuring substance over form.

Omar itemises six criteria in this regard:

- Selecting KPIs that really matter;

- Setting targets for each KPI that is tied to national aspirations, as opposed to what is comfortable for the ministry to achieve;

- Supporting the KPIs with clear action plans;

- Ensuring integrity in performance reporting;

- Having clear consequences for non-performance; and,

- Developing clear communication and buy-in.

"Generally, you start from the top and then cascade down.

"This is the only way to have KPIs that are truly strategic and focused on key priorities."

He recommends that top management itself, i.e. ministers, deputies and secretaries-general, be involved in KPI development.

"The prime minister must be personally engaged in this process to ensure focus and attention is given to the priorities that truly matter, to how the government as a whole, will be measured and evaluated by the rakyat at the next general election."


At the mercy of civil servants

BELOW are true stories in dealing with the civil service.

* An Immigration Department officer openly contradicts official policy by refusing re-entry to a foreign maid because she had gone home during a 2004 amnesty for foreign workers.
When her employer tells the officer that the home minister had publicly guaranteed that workers like her could come back to work in Malaysia, the officer replies: "What the minister said is one thing but I have not received any new directives, so we will continue with the old policy."

* An illiterate man from Taiping tries to apply for a birth certificate and is shoved to Ipoh and Putrajaya, only to be told that he has to go back to get a sworn statement from his village head.
The man seeks help from his member of parliament, who tried in vain to get the document in time for the general election. The MP is then blamed for being inept.

* A man turns up at the Housing and Local Government Ministry's headquarters with a bag of garbage, dumps it in the foyer and stomps off.
He tells the shocked security guards that he is disgusted with not being able to get garbage collection services despite numerous complaints to the ministry.

In all these cases, asks former deputy minister in the Prime Minister's Department Datuk M. Kayveas, who do you think gets blamed at the end of the day?

"The Barisan Nasional, even though we as ministers and deputies tried our best to make dealing with the government as people-friendly as possible."

The relationship between the civil service and political appointees such as ministers is complex.

So, when it comes to instituting KPIs on ministers and deputy ministers, Kayveas bluntly says it misses the point.

"A minister and his deputies' performance are very much dependent on the senior government officers and the civil servants below them.

"A minister can come up with brilliant ideas but if the implementers under him refuse to cooperate, those ideas will only remain as ideas.

"So how do you fairly rate a minister's performance? What kind of measures do you use that takes all this into consideration?"

And implementers can throw up a thousand and one barriers if they want to hamstring a minister.

Relating his experience, Kayveas tells of how a plan could not get off the ground quickly because the officer in charge was away on course.

When the officer returned, months were spent on getting a proper working paper drawn up.

More months passed before the necessary approvals were received.

"By the time we could really move ahead with it, the general election was already called."

The number one reason why great ideas do not get translated into working policies is because there is a yawning chasm in motivation and incentive between political appointees and civil servants.

Political appointees have to do their best because they can get dropped from the cabinet, they go through the mother of all assessments -- the general election.

In contrast, civil servants jobs are for the most part secure and effectively free of public scrutiny and appraisal.

This, Kayveas says, has turned the civil service's senior managers -- directors and secretaries-general -- into an exclusive cabal.

"There is a common saying among them: 'A minister comes and goes every five years but we stay forever.'

"There are brilliant officers but they are not given a chance to shine.

"They are often sidelined by either their superiors whose positions are threatened, or by their colleagues who fear that their performance would reflect badly on them."

In his opinion, the only way to ensure that the machinery performs is to replace directors and secretaries-general with elected politicians.

"At present, the elected party does not run the government. We allow civil servants to run it but it is the politician who has to face the people when there is a fire, a flood or when someone cannot get documents."

A KPI for political appointees may help the prime minister choose his cabinet, but it has little impact on the common folk who have to deal with the government every day.

Another set of KPI for the civil service's senior managers would also be pointless. Kayveas cites an example of how even the most derelict and scandalous officers are shielded from action by the "cabal".

"If you want improvement in how the government functions, put the politicians in charge."

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