Transforming the Public Service
How could a business CEO proceed in tackling New Zealand's public service that has been likened to a poorly managed company?
NZ Greens co-leader, Chl?e Swarbrick claims: “A country is not a company, and a Prime Minister is not a CEO.” This is a glib appeal to the uninformed.
Businesses strive for efficient operations, clear metrics, and eliminating waste and redundancy. Applied well, this will make government services more streamlined and cost-effective. CEOs are used to being held accountable for performance by a board and shareholders, so this level of accountability incentivises better governance and policy outcomes. Businesses also focus on pragmatic solutions over partisan ideological stances. This leads to more collaborative, results-oriented policymaking.
Chl?e may argue a company's motive is profits, while a government must balance many societal interests beyond just economic outputs. However, companies don't solely focus on profits to the exclusion of all other interests. Successful companies balance the interests of various stakeholders, including employees, in order to sustain their operations and maintain a productive workforce.
Dr Oliver Hartwich, Executive Director of The New Zealand Initiative, recently wrote: “New Zealand’s public service is like a poorly managed company that fails to produce decent results and has forgotten what good looks like. It is not as if New Zealand’s governments had not spent enough over the years. It is rather that they had done so senselessly, without regard for outcomes.”
When the critics describe your organisation as a “poorly managed company that fails to produce decent results and has forgotten what good looks like,” it's a wakeup call that radical changes are needed. This is the brutal assessment recently levelled at New Zealand's public service after years of perceived underperformance and misaligned spending priorities.
So, how would a business CEO tasked with tackling the issues Hartwich describes, approach the problem?
A CEO brought in to drive a turnaround, would approach this challenge by drawing upon the same fundamental principles that govern successful transformations in the private sector. While the public sector's motivations may differ from pure profit-maximisation, the underlying disciplines around process excellence, performance management, capability building, and governance rigour still apply.
The first priority would be to accurately diagnose the root causes behind this long-standing underperformance. This would involve a thorough, objective and data-driven organisational review by engaging external experts and management consultants. Every major agency, department and core process would be put under the microscope to map out structures, roles, decision rights and reporting lines to identify overlaps, bottlenecks, and bureaucratic inefficiencies. Operational metrics like cost per transaction, lead times, employee productivity etc. would need to be benchmarked against relevant public/private sector peers.
Historical spending patterns across various programmes and initiatives should be analysed vis-a-vis actual outcomes achieved to gauge spending effectiveness. Workforce skills inventories and identify critical future capabilities gaps that need addressing e.g. digital literacy, data/analytics prowess etc. must be assessed, and wide-ranging stakeholder consultations to understand citizen pain points and service delivery issues should be conducted.
Armed with this analysis, the path forward would start by redefining a strategic direction through a collaborative process with ministers, senior public servants, and key stakeholder groups. This would involve establishing a compelling vision and roadmap. A CEO would codify a clear and inspiring vision for a world-class, citizen-centric public service characterised by operational excellence, agility, and innovation. Supporting this vision would be a set of ambitious yet achievable strategic goals covering crucial imperatives like service quality, cost efficiency, public trust, and outcomes orientation. For instance, targets could range from reducing application processing times, to boosting citizen satisfaction scores, to improving transparency through open data initiatives.
To translate this high-level strategy into tangible results, these organisational goals would be broken down into granular objectives and Key Performance Indicators (KPIs) at the agency, team, and individual employee levels. Robust reporting tools and qualitative/quantitative dashboards would be implemented for continuous monitoring of progress against these metrics. Without clear line-of-sight on how everyday activities roll up into broader outcomes, even the best-intentioned efforts can lose focus.
With this foundation of a well-defined transformation roadmap backed by transparent KPIs in place, the heavy lifting would then involve concerted initiatives around process redesign, capability building and governance restructuring.
Utilising continuous improvement methodologies like Massey University’s Lean Six Sigma, existing processes across all major citizen-facing and back-office operations would be comprehensively re-engineered and streamlined. Non-value-added activities would be eliminated, whilst leveraging digitisation, workflow automation and next-generation cloud platforms to significantly boost productivity and speed of service delivery. Functions exhibiting high degrees of similarity would be consolidated into centralised shared services centres of excellence to optimise resources and achieve scale economies.
In parallel, technology modernisation programs would be initiated to undertake comprehensive upgrades for cumbersome legacy IT systems. This could involve strategic partnerships and innovation challenges with leading private sector technology firms. With analytics and machine learning models implemented to improve demand forecasting, digital integration of transactional processes and rule-based automations for routine tasks, the public service's responsiveness and decision-making speeds could be drastically enhanced.
Technology alone would not be enough to drive the shifts required. A major capacity building initiative around developing the critical skills, mindsets, and ways of working for the public workforce of the future would be essential. An audit of existing human capital capabilities would inform the design of extensive training curricula and accreditation pathways for building core public sector competencies around areas like data/digital literacy, agile project management, human-centred design thinking and futures foresight.
This could be complemented by overhauls in recruitment practices to attract top talent from diverse industry backgrounds beyond just the traditional public sector feeder pools. Cross-pollination of experiences and perspectives from private/nonprofit sectors could be invaluable for infusing innovation. Existing performance management and incentive structures would be modernised to retain high performers and foster an empowering culture centred on continuous learning, intelligent risk-taking and bold experimentation. Tangible improvements to employee workstreams, work environments and engagement levels would be crucial to reversing the “forgotten what good looks like” mentality.
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Underpinning all these measures would need to be comprehensive change management programmes involving extensive consultations, communications, and hands-on coaching. Carefully sequenced transition roadmaps and dedicated teams would be vital for ensuring all changes take root and stick.
Lastly, no organisational transformation can succeed in the long run without addressing the governance foundations. This would necessitate a thorough review and overhaul of the underlying legislative frameworks, funding structures and decision rights protocols that may inadvertently hamper institutional agility and accountability.
Governance models that foster innovation and public-private collaboration would be evaluated through greater use of independent delivery agencies, commissioning private/non-profit vendors for appropriate services, and leveraging alternative financing models like social impact bonds. More authority would be delegated to frontline teams through robust devolution of operational decision rights to those closest to citizens.
Public engagement and transparency would be prioritised through regular publishing of performance data, outcomes reporting and structured mediums for feedback. Regular formal programme reviews would be mandated, whilst agency funding and leadership incentives would be more tightly aligned with progress made against critical citizen priorities.
Finally, the role of central oversight and coordination entities in ensuring cohesive cross-agency alignment would be strengthened. This could include developing dedicated centres of expertise in areas like digital strategy, workforce planning and future foresight. Along with strong political leadership committed to sustained implementation, this approach would promote both organisational responsiveness and synergy towards common nationwide objectives.
Tackling an institutional turnaround of this scale would require courageous transformational leadership underpinned by rigorous programme management and robust governance reforms. It's not a quick fix by any means. However, by embracing a holistic strategy encompassing process optimisation, capability upgrades, technological modernisation and empowering governance models, the coalition government can absolutely aspire to rebuild the public service as a shining exemplar of excellence, agility, and citizen-first orientation. The future public service that New Zealanders deserve is well within reach, through vision, accountability, and disciplined execution at all levels of the organisation.
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