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Skip to main content Skip to main navigation menu Skip to site footer. Keywords: public value, measurement, framework, comparison. Abstract Fair methodology for public performance measurement is at present one of the most important issues, especially in terms of providing high quality services for citizens in an economic way.

Department of Organisation and Management Method ul.

Assumptions for a Combination of Public Value and Performance Management

How to Cite. In every country, the determination of what is a public service and of what kinds of organizations provide it is, of course, ultimately a political one. The model has been further modified based on valuable input from many in academia and public service. Past as Prologue A great many theories, stretching back nearly a half century, have been devoted to measuring and improving public performance and defining public value.

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Yet the lack of agreed standards for defining and achieving value in the public sector is one of the key missing links in the public service value chain. What, after all, comprises high performance in a social services agency, for example, and from whose vantage point can one rate such performance? Social outcomes tend to be harder to define and achieve than outputs, and many public service organizations primarily measure outputs.

Our approach attempts to build upon the leading theories in the fields of public management and public value and to introduce a practical methodology that public managers can use to put many of these theories of public value into practice. The Public Service Value Model is designed to produce results that can be interpreted by various public service stakeholders, including taxpayers and legislators, who are interested in improving their ability to judge how cost-effectively tax revenues are being spent.

It is not intended to be an allor-nothing methodology to replace previous approaches to performance management, such as the Balanced Scorecard or government performance assessments, but rather to be complementary to existing performance management frameworks. The Public Service Value Model adapts the principles of commercial shareholder value analysis to a public service context, using citizens, the taxpayers and public service recipients as the primary stakeholder.

An outcome is an end result, not to be confused with outputs, that are specific products or services delivered.

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Broadly speaking, a public service organization generates public value when it delivers a set of social and economic outcomes that are aligned to citizen priorities in a cost-effective manner. By increasing either outcomes or cost-effectiveness, an organization creates value. By increasing one at the expense of the other, an organization makes a trade-off between the two fundamental means of creating value. A decrease in both levers represents a clear reduction in public value.

One of the reporting tools of the Public Service Value Model is a matrix that can enable managers to plot outcomes against costeffectiveness. The methodology can be used to help public service organizations review their performance and identify practical steps to achieve their performance goals. The model does not focus on inputs such as the number of nurses, teachers or police officers in service. While the Public Service Value methodology can help identify specific areas of low or high performance through its analysis, it cannot tell us why an organization or sector is doing well or poorly.

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To understand what is driving performance, we need to conduct a deeper analysis of public service value and investigate what factors are underpinning or contributing to fluctuations in performance. The real strength of the Public Service Value Model is in its demonstration of whether an organization is doing better or worse than in other years, and whether its performance in a given year is better than the average performance over a specified period of time. But, further research and analysis is required to understand the underlying value drivers.

Contrary to many public sector performance measurement approaches that remain vague or imprecise on relating outcomes and expenditures, the Public Service Value Model brings these two key components together to help public managers solve their most pressing problems. That is the new thing that the Public Service Value Model brings to the table. The Public Service Value Model provided a unique structured approach and the focus we needed to get this effort done.

The first three chapters, of particular interest to generalists and newcomers to the field, address the need for public value and the historical trends that have shaped the pursuit of value in the Americas, Europe and, more recently, Asia. The final chapter addresses the importance of focusing on innovation to drive value creation in the public sector. In the Appendix, we have outlined the calculations and related details of the Public Service Value methodology.

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The Public Service Value Model is not intended to be a backdoor means of evaluating public performance and managers. This is not an audit of an organization or its managers. We plan to contribute to that in further research and study. In the meantime, we offer the Public Service Value methodology as a set of tools and techniques to help public service managers link action to outcome as they plot their journey to high performance. Thanks to all of our Accenture colleagues who helped us over the past three years with the development of the Public Service Value Model and with the creation of this book.

Particularly in times of crisis, taxpayers question the value their governments are delivering to them. The increasing use of the Internet has further raised the bar on the level of service expected by the public. Some governments employ selective contracting out and privatization to raise productivity. Elliott Hibbs must have felt as if he were caught in the jaws of a giant vise.

Meanwhile, stakeholders ranging from legislators to taxpayers were demanding continued high levels of processing, enforcement and taxpayer assistance services without adequate resources to deliver those services. In 1 2 Unlocking Public Value addition, the prior administration had taken resources from enforcement and moved them to the service delivery side of the agency to meet the demands for swift refund processing, adversely impacting the effectiveness of the department, particularly in collecting unpaid taxes.

As part of the new administration and to combat what appeared to be a serious decline in agency function and capabilities, Hibbs presented a plan to the legislature to restore department resources to levels by improving processing while increasing aggressive collection of delinquent taxes.

Caught in this dilemma, Hibbs agreed to pilot the Public Service Value methodology as a way of allocating resources to areas that would create the most value for Arizona taxpayers. Along with other public managers around the world at that time, Hibbs was facing a public sector squeeze. He needed to find a way to create value with scarce resources. Public Service Value Approach Like Director Hibbs, readers wrestling with the challenges of delivering value in the public sector may find Figure 1.

It can be used to frame discussions with public managers about choices and trade-offs available to increase outcomes, or end results of The Public Sector Squeeze 3 programs, as cost-effectively as possible. The Public Service Value Model is a framework that public managers can use to set priorities between several goals and objectives. By our definition, highperformance governments are those that increase public value— they are able to efficiently produce more or improved outcomes for the public monies spent.

The Public Service Value approach has been developed over the past few years with the help of dozens of government organizations and academic experts.

Unlocking Public Value - E-bok - Cole Martin Cole, Parston Greg Parston () | Bokus

Public service organizations can plot their performance on the Public Service Value Model diagram see Figure 1. For example, if an organization moves to the upper right-hand quadrant, it is succeeding in increasing outcomes and cost-effectiveness at the same time. On the other hand, if a public service organization increases outcomes but is not costeffective, it will move toward the upper left-hand quadrant. An organization that manages its costs, but sees a reduction in outcomes, will move toward the lower right-hand quadrant.

In these last two cases, when done deliberately, organizations are making explicit trade-offs between focusing on improved outcomes and increasing cost-efficiency in order to, in effect, maintain public value. Lastly, if an organization heads into the lower left-hand Value Turnaround In , Hibbs applied the Public Service Value Model to his agency to better determine whether, and how, his agency was adding value on a cost-effective basis. Using available revenue agency data, the model uncovered some eye-opening results. The model also graphically illustrated, using directional arrows to track annual department performance, that the steps taken beginning in early were creating value see Figure 1.

While it still had a long way to go, the Department was achieving more of its strategic outcomes on a more cost-effective basis. How those outcomes were derived and tracked will be discussed in detail in Chapter Four. The Public Service Value approach to helping public managers define and increase value in the public sector was inspired by the principles of Shareholder Value Analysis, which is commonly used to understand the performance of companies.

For the Public Service Value 6 Unlocking Public Value Public Service Our definition of public service is meant to be inclusive to encompass all organizations that are engaged in delivering services to the public that are, at least in part, paid for using taxpayer money. Public service organizations therefore include government agencies, nonprofit organizations and private sector companies that provide services that have traditionally been delivered primarily by governments.

The determination of what is a public service is ultimately a political determination by governments. Model, we substitute private sector shareholders with taxpayers, citizens, public service recipients and legislators. How does one tell if public service programs are adding value?

The pressure on budgets in most countries is unlikely to lessen significantly in the years ahead. One significant factor driving this fiscal crunch in most of Europe particularly in France and Germany , Japan and the United States is the rapid aging of the population and the demands that population is putting on the social security and health care systems in these countries. By , according to the Congressional Budget Office, the cost of these programs is projected to consume about 15 percent of GDP, and by they could equal about 19 percent of GDP.

States continue to shoulder heavy Medicaid-related health care costs. With few exceptions, many states also were unprepared for the fiscal downturn at the beginning of the new millennium.

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Some either borrowed heavily by issuing debt, engaged in budgetary maneuvering by underfunding pension or other long-term obligations to help cover shortterm operating deficits, or both, to ride out the storm. Great Expectations It might seem logical for stakeholders to reduce their expectations of government when confronted with such obvious budget squeezes. However, quite the opposite reaction often seems to be the case. Interest in improving public sector performance comes from all angles, including taxpayers, public service recipients, the media, nongovernmental organizations and legislators.

Public managers, already interested in finding new and improved ways to deliver public services, are reaffirmed in their efforts. In , twelve years after co-authoring the influential Reinventing Government, David Osborne published another important contribution to the debate on public value, The Price of Government, with co-author Peter Hutchinson.

Osborne and Hutchinson have tracked spending at the federal level, as well as at state and local levels, in the United States for the past several decades. They demonstrated that since the early s federal revenues all taxes, fees and charges , as a percentage of aggregate personal income, trended within a fairly narrow range, averaging slightly more than 20 percent. At the state and local levels, the cost of government during this same period stayed within even narrower ranges of 7 to 8 percent for state, and 6 percent for local.

If taxes trend too low, citizens complain about inadequate services and social inequities. If they trend too high, taxpayers and politicians start pounding the table for tax cuts. They are in effect pressing for more value each year for the money they pay. In this respect, government is challenged by the same forces that constrain any other provider of goods and services. They only point out that the sole precedent for such a dramatic repricing of government in the United States was triggered by a world war hard on the heels of a global depression.

It occurred in the s when federal taxes increased dramatically to pay for World War II. Once the U. The aftermath of a crisis is one of the periods during which citizen and legislative stakeholders stand back and reappraise the value they are receiving from public service organizations. Under such circumstances, stakeholders are more likely to look at how public service organizations performed, or failed to perform, in response to the crisis. A good deal of public debate following the hurricane centered on the federal funding of levee maintenance and improvements in New Orleans.

Questions were raised. If more money had been spent on the levee construction to make them able to withstand a more severe hurricane like Katrina, rather than a lesser storm as constructed, there may have been a different outcome. The consequences of resource allocation decisions are brought home to stakeholders at such times.