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Mr. Maurice McTigue is a former New Zealand Cabinet Minister and an international authority on performance management. Currently, Mr. McTigue is a Distinguished Visiting Scholar at the Mercatus Center, George Mason University. We had the opportunity to interview Mr. McTigue and he shared with us some valuable insights about results-based management, including lessons learned.
Results-based management or managing for results, means that managers keep the focus of all the organization's activities on the intended outcomes of the work. It is very similar to what the Government Performance and Results Act is requiring of U.S. Federal agencies.
Agencies must examine why they exist in the first place. What was the original reason for establishing the agency? Is it still delivering what it was originally supposed to deliver? Is the agency's purpose still appropriate? Is it meeting its customer needs? Finding out the answers to these questions is the first step to results-based management.
In New Zealand, I was the Minister of an agency that serviced welfare recipients. When I first took office, I found the agency focusing its efforts on case processing activities, such as determining an applicant's eligibility for welfare, ensuring that the correct amount was paid to recipients, and recovering overpayments. When we switched to managing for results, we began by asking ourselves why the Government had gotten into welfare payments in the first place. We found that the original reason for the agency's existence had been to help dependent people get their lives back together so that they could be independent citizens. So that's what we channeled our efforts towards - helping people become independent.
Foremost, our performance improved. We had a 300 percent increase in the number of people who became independent of welfare. But that wasn't the only benefit. We found that employee morale also increased significantly. Previously, our employees had been concerned only with determining welfare eligibility - a very narrow focus to the job. With the switch to managing for results, employees increased their span of involvement. Instead of looking only at case work and money paid out, employees spent time developing a rapport with the welfare recipient, analyzing needs, and accessing additional resources for the recipient, such as psychological help, educational resources, and health care expertise. Employees gained a sense of accomplishment as recipients were helped and this increased their job satisfaction. Employees became much more interested in the job and their performance improved.
Four main lessons learned come to mind. First, be sure to establish a clear vision for the organization. Have clear goals that everyone can understand. Also, get everyone's buy-in on the goals. When employees have a clear vision and understandable goals, morale increases significantly, people are enthusiastic about their jobs, and performance leaps ahead. About 70-80 percent of the New Zealand Government's employees are working under performance contracts that clarify organizational and individual goals.
Second, find a way to help employees see that they are being successful, and when they're successful, recognize them for it with awards. Begin by measuring their day-to-day work and give them performance feedback. Devise a way they can get automatic feedback. Results-focused work provides intrinsic rewards, and people with clear goals will go along for quite awhile without recognition. But eventually, they need and expect to be recognized for their efforts.
Third, clear out the barriers and constraints that hold people back from doing what they need to do to reach their goals. Managers should facilitate the ability of front-line employees to achieve desired results. Are work processes cumbersome? Do employees have the necessary skills and resources? Also, is the measurement system measuring the right things and is it being used the right way? Upper-level managers shouldn't be worrying about process measures; those belong to front-line supervisors. The measurement system also shouldn't be used by managers to punish employees for errors.
Finally, communicate performance levels and goal achievements to employees, the public and other stakeholders, such as Congress. Keep everyone informed about how and what the organization is doing. Internally, communicate from the top down, the bottom up, and sideways across the organization. Externally, develop relationships with the legislature and the public. This creates more buy-in from everyone and allows performance improvement.
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