PIF Fact Sheet 3: How does the Performance Improvement Framework fit with the other business improvement tools?
When Iain Rennie became the State Services Commissioner in July 2008 he was concerned that the State Services was not taking ownership of its own performance. He noted that there were plenty of reports from external agencies and lobby groups, which were often critical. He felt that many of them did not recognise the real strength of the public service. Equally, he wanted to move the culture of the public service towards a performance improvement culture. In short, he wanted organisations public servants worked in to be better.
In 2009, he and the then Chief Executive of the Department of the Prime Minister and Cabinet, now Sir Maarten Wevers, travelled to the United Kingdom to meet with the Cabinet Secretary of the British Civil Service. The origins of the Performance Improvement Framework (PIF) are in those discussions with the then Cabinet Secretary, and now Right Honourable, Lord Gus O'Donnell. On their return to New Zealand, Iain and Sir Maarten commissioned a team from across the State Services to take the best of the United Kingdom's Capability Review Programme and the best of the organisational improvement models from the New Zealand private sector, as well as methodologies from other jurisdictions, and adapt them to the New Zealand public management system.
Three years on PIF is still emergent but continuously improving. For those who are unfamiliar with the offering, it is not an audit, nor an investigation or an accreditation process. Nor is it a report card or business process engineering. Rather, it is a review of an agency's fitness-for-purpose; specifically, a review of the current state of an agency and how well placed that agency is to deal with the issues that confront it in the near future. It also includes a response from the agency itself that proposes areas where it will do the most work to make itself fit-for-purpose and fit-for-the-future.
The method of enquiry is qualitative, using a combination of desk-top analysis, as well as probing but respectful one-on-one interviews, and focus groups. It has the advantage of integrating publically available performance information, internal management information and the analytical grunt of the State Services Commission, the Treasury and the Department of the Prime Minister and Cabinet. Finally, it relies on a robust peer review method. In summary, it is an integrated, deep, fast and independent - as well as published - review of State Services agencies.
The diagram below offers an insight into how PIF works with other business improvement tools. The diagram reflects the guidance provided by the Ministry of Business, Innovation and Employment. (A larger image of this diagram can be viewed in the PDF version of this Fact Sheet, attached above.)
What findings are emerging?
We do a number of things really well. We are responsive to Ministers. We are good at delivering against government priorities. We work well with a number of external stakeholders and we are good around the probity of our financial management system. These are all good characteristics of the New Zealand public management system.
Where do we need to do better?
So far the Reviews have a very common theme. They show the need for us as a system, ie, the wider State Services, to get better at working together. We also need to take a longer-term view to what we do; this means anticipating the issues that the State Services need to deliver on for New Zealanders in the future. For some agencies, it is clear they can do better at managing and developing their people.
What are the benefits of PIF Reviews to central agencies?
The central agencies get a good picture of what is good about the New Zealand public management system and what needs to improve. Central agency officials would frequently get asked ‘who is good at financial management?’ or ‘who is good at setting strategy?’ Up until now there has been no way they could point to the areas of demonstrable and evidential strength. Now they can. Before PIF everyone had their own anecdotes about what needed to be done better. For central agency officials PIF gives a system-wide diagnosis about what is good and where the system can improve.
What is the benefit for Ministers?
Ministers get assurance that the agencies they are responsible for are constantly looking for ways to improve how they do business and deliver value for the taxpayers’ investment in them. Ministers also get independent assurance, as the PIF Reviews are undertaken by external expert parties.
What about the public?
The public is able to see that the State Services are ‘on the move’ and are serious about the services it delivers and how these are delivered. The public can see that the State Services are continuously seeking to improve and are transparent about that journey.
What do you see as the future direction?
PIF will continuously be reviewed. Every time we do a Review we learn something and we seek to build that into our own continuous improvement process. With the advent, for example, of the Better Public Services programme, we are seeking to shift the bar in respect of standards of performance. From our point of view, Better Public Services and PIF examine the same drivers. Where PIF is all about jobs we do, and improving the workplaces for public servants so they can do their jobs better, Better Public Services is also about improving what we do on behalf of, and for, New Zealanders.
Performance Improvement Framework: Continuous improvement
The PIF already has a number of dimensions to it. Agencies conduct Self-reviews where they rate themselves against the Agency Model. For many this is a precursor to a PIF Review. An agency that is formally reviewed will also undertake a Follow-up Review, usually 12-18 months later, which reviews the progress the agency has made since the PIF Review.
In addition, ten PIF Elements will be upgraded between now and the end of March 2013. As part of this guidance release, three PIF Elements are upgraded. Those elements are Asset Management and Financial Management, as well as Efficiency.
Successful agencies need their finance functions to look beyond the traditional core functions to use their financial acumen and insight to drive new value and higher levels of business transformation and performance. A close reading of the current upgrades place more weighting on the use of financial management information and advice for operational and strategic purposes and on the proactive role the finance function needs to play in decisions around creating value for money and leading strategic financial management disciplines in the agency.
Performance Improvement Framework: Crown entities
We have already started rolling out PIF to the Crown entity sector. Both the New Zealand Transport Agency and New Zealand Trade and Enterprise have been reviewed. Over the next two or three years, as we complete Reviews for the core public service, we are increasingly wanting to focus on the wider Crown entity sector.
For more information
A new guidance series was released in April 2013. It reflects developments in the suite of Performance Improvement Framework products and services. As with any good performance improvement tool, PIF will continue to improve to meet the needs of Ministers, the public, chief executives, senior leaders and agencies in the wider State Services. To contact the PIF team email: email@example.com.