By Ian Elliott, Queen Margaret University
George Osborne’s populist attack on public sector salaries made for just the headlines he wanted. He promised to end “automatic progression pay” in the civil service by 2015-16, and to work towards ending it in the education system, the NHS, the prison service and police service.
The issue is a good deal more complex than the easy headlines make it out to be, however. Pay reform will be very tough to implement, and its too early to tell if the political will exists to see it through.
The text of the Spending Round 2013 report can help interpret what has been announced in the House of Commons. It is inevitably more cautious than the headline writers. But in between the nuanced language of the report and the sensational headlines, we can get a sense of what actually lies ahead for public servants.
The government has only committed to make a plan, not to end pay progression immediately. These plans will undoubtedly take some time to complete and are likely to come under review with the election of a new government, of whatever party, in 2015.
Teachers and workers from the health, prison and police services, are likely to see little change in their progression pay any time soon. It’s clear that some reforms will be taken forward, or are already underway, but there is no clear timescale for implementation.
Many of these workers have not received “automatic progression pay” in many years anyway. For some, progression pay may already be linked to performance. For others, it has been frozen for some time. For the minority who do still receive progression pay purely as a result of time in post there is likely to be a move towards linking progression pay to satisfactory performance. But again, something tells me this won’t happen tomorrow.
Even if the government were being more forceful, there are some real implementation issues involved. Progression pay is typically a contractual obligation, and changing the terms and conditions for public service workers would therefore mean renegotiating all these contracts. Given that there are more than 200 separate bargaining units in the civil service, each with their own pay structures and their own terms and conditions of employment, politicians are likely to avoid this task in the run-up to a general election.
It is important to remember that what is at play here is politics. Whatever happens regarding progression pay in the public sector, the chancellor has set out his stall for the upcoming election campaign. There is an apparent political desire to play to the galleries in stating that “some public sector employees see annual pay rises of 7%”, referring to progression pay as “antiquated” (though it is being retained in the armed services) and drawing distinctions between public and private sector pay.
Again, pay realities are very different for many public sector workers. For example, three quarters of council workers currently earn less than £21,000. Almost two thirds of civil servants earn less than £25,000. Yes, average pay in the public sector is higher than in the private sector. But it is also true that a significant number of low-paid jobs in the public sector have been privatised over the last 20 years. Those who are left are disproportionately employed in professional roles such as doctors, nurses and teachers.
These same professional workers face the challenge of continuing to deliver vital public services such as healthcare and policing with fewer staff and less resources. Additional cuts risk affecting stress levels as well as morale, productivity, recruitment and retention. Nurses, teachers and carers are already among the most stressed workers according to the Health and Safety Executive.
At a time when public services are facing such significant change and uncertainty, the biggest challenge for employers will be to find new ways to attract, train and retain skilled public service workers in the future. Cutting progressive pay, or even talking about planning to, won’t help.
Ian Elliott does not work for, consult to, own shares in or receive funding from any company or organisation that would benefit from this article, and has no relevant affiliations.
I was recently asked by a student to provide a brief account of the advantages and disadvantages of applying lean management systems in the delivery of public services. This is my quick attempt at a brief answer!
First of all, what is Lean Management? This is actually a rather difficult question as terms such as continuous flow manufacture; stockless production; lean manufacturing; Lean thinking; Toyota production system and systems thinking have all become associated to a greater or lesser extent with ‘Lean Management’. However, for me, this short advert for Honda (a key proponent of lean management) encapsulates the essence of lean management:
First of all I think there is a lot to be said for a Lean Management way of thinking. Within public services perhaps the key text in this area is John Seddon’s Systems Thinking in the Public Sector. Now, there are probably some who would automatically switch off at the very mention of Lean Management. It could be dismissed as ‘just another management fad’. But actually there is something to it and it is worth considering the positive aspects of Lean.
In my view, Lean is predominately about creating a learning organisation with empowered and autonomous workers. This is encapsulated in Mr Ohno, the Toyota executive who has been credited with the development of lean management, refused to have any of the lean management approach written down as then it would become crystallised and difficult to change – and would then stifle innovation. For Mr Ohno it was important that lean management continuously change and development. Consequently one should always be wary of any text or consultant who claims to be prescribing a lean approach (NB: that’s not to say that some books or consultants may have interesting things to say on the subject).
Nonetheless, there are some basic principles which can help with understanding a lean management way of thinking. The main focus of lean is on finding efficiencies in production through the elimination of all waste. Importantly the definition of waste is very broad in this area and has nothing to do with bins or recycling. Waste, in a lean management perspective, is any activity that does not directly contribute to satisfying customer needs. That is a quite radical way of thinking. Take a moment to consider the tasks you perform in an average week and ask yourself how many directly contribute to the satisfaction of your ‘customers’?
This is a useful way of thinking. So, for example, how is attendance at any one particular meeting going to directly enhance your customer’s satisfaction? Also, how does your organisation reward attendance at meetings vs delivery at the front line? However, this line of thinking when applied indiscriminately can be completely inappropriate; for example, empty hospital beds could be viewed as waste under this approach. Overall though there are undoubtedly many things that all businesses and organisations do that do not directly serve the needs of customers. As such this is a valuable mind-set to have.
It is workers at the front line of operations who are best placed to identify areas of waste and so the Toyota approach to lean management was to empower workers to identify areas of waste and to take responsibility for the inspection and quality control of their own work. A key argument being that failure, in the form of defective goods, represents a form of waste. Therefore a lean approach requires a commitment to ‘zero defects’.
In the public services John Seddon argues for the abolition of the Audit Commission, stating,
People’s work should not be inspected; people should be their own inspector.
Seddon (2008: 63-64).
However, this seems like a rather unrealistic goal within public services, even where the current UK Government may be working towards abolishing the Audit Commission there will always be a need for auditing and scrutiny of public services – hence the development of a new auditing regime. This is due to the demand (what John Seddon would describe as ‘failure demand’ for accountability in public services when things go wrong). This is heightened by the extent to which public services are often dealing with life-or-death situations with highly vulnerable groups. As the case of Mid-Staffordshire NHS Trust shows, where failure does occur in public services it is important that lessons are learned and there is some accountability for the mistakes that have happened.
At this point it would be wrong to conclude that Lean is something that can only work within a manufacturing setting. As this article from the Harvard Business Review illustrates there is some relevance to the service sector. However, public services, which have their own distinct challenges, have particular characteristics that make a lean approach more difficult to achieve.
To some extent a lean management way of thinking is important in public services today. Public services are increasingly expected to be responsive to ‘customer’ needs and continuous improvement (and efficiency savings) have become an accepted part of how we plan and deliver our public services. However, we are still accountable to the public and therefore good governance mechanisms are key. To an extent, when things go wrong in public services, we (the public) tend to fall back on bureaucracy – what policies and procedures were in place?; how was the service audited and inspected?; where does accountability lie?
There are in fact some positive aspects of bureaucracy which are important not to forget. As the former Cabinet Secretary, Sir Gus O’Donnell, has put it,
In this country you can renew your car tax if you can prove you own the vehicle, it is roadworthy and it is insured. In other parts of the world all it takes is knowing which palms to grease. Bureaucratic systems are colour-blind, gender-neutral and they don’t care what you sound like. That brings fairness in a way more discretionary systems can never match.
Sir Gus O’Donnell, ‘There is no shame in being a bureaucrat’, Financial Times, 2013.
Finally, what I have found in speaking to those who have experienced the ‘implementation’ of lean management in public services is that there is a fairly piecemeal approach. Those aspects that are seen to deliver cost savings are pushed through with some gusto whilst aspects of empowering and developing staff (where investment may be required) are quietly forgotten. Yet the successful delivery of a lean management approach is totally dependent on a committed and empowered workforce. It is, in many respects (as highlighted by John Seddon) the very opposite of a traditional command and control form of management. So as soon as someone tells you to implement lean management – and dictates how it is to be done – you should consider what they are actually meaning.
There is lots more I could say on this topic but I was trying to keep this short so I’ll leave it for now. If you have any further questions please use the comments box below.
In a previous post I highlighted some of the challenges that are inherent in managing public services due to the nature of being ‘public’. However, there are also challenges that come with managing a ‘service’. These challenges apply across private and public services, and whether delivered by public, private or Third sectors.
These issues are quite important to recognise for all managers given the continuing rise of the service sector across the world. In fact services account for 62.9% of global GDP.
The key characteristics of services are intangible, heterogeneous, inseparable, and perishable as defined by Zeithaml, Parasuraman and Berry 1990 (although some, notably Lovelock and Gummesson, 2004, have questioned this classification).
Services are largely intangible. They are about having an experience. Of course there are some physical characteristics associated with most services, such as the quality of chairs in a fine dining restaurant, but what makes services unique from goods is the extent to which perceptions of service quality are impacted by environmental factors and customer-provider interactions. These intangible factors are very difficult to control or manage.
Take, for example, a business offering guided bus tours of the Scottish highlands. There are a number of physical features of this service such as the comfort of the seats on the bus. But ultimately much of the service experience will be influenced by factors entirely outside of the control of the business – weather, the interaction with staff, the behaviour of other customers on the bus (to name but a few). These intangible factors make service interactions very unpredictable and difficult to control.
The fact that services are intangible also means that they are not easily stored for future use. So if there is excess capacity this cannot be stored to be sold at another time. In other words, services are perishable.
Take, for example, a street performer. If they do not attract a significant audience for their performance that equates to lost income. They cannot get that time back. Hence the pressure within many services to get ‘bums on seats’. Consequently, pricing is key – particularly with services that have high fixed costs and a fixed capacity such as with cinemas, restaurants and bus tour companies.
Inseparability of production and consumption
Most services are produced at the same time as they are consumed. So the street performance will be consumed at the same time as it is ‘produced’. This means that quality control is much more difficult than with goods. It also places significant pressure of service staff to always ‘perform’ at a consistent level. This requirement of service workers to perform is best described by the Hochschild (1983) concept of emotional labour. Numerous studies have shown that the strain of constantly having to perform can lead to stress-related illnesses. This blogpost by Flip Chart Fairy Tales highlights a number of other reasons why people in service occupations tend to have more sickness absence that in other occupations.
As an example of the inseparability of production and consumption take transplant surgery. The medical staff must perform consistently under the most extreme pressure with every single patient. Mistakes can cost lives and, unlike with manufacturing, are often not easily rectified. Yet quality inspection and control can only happen at the same time that the ‘customer’ is receiving the service. Furthermore the speed of service delivery is critical. Under these circumstances it is truly impressive what our health workers do on a daily basis. Hence those who use a service, such as the NHS are likely to be more satisfied with the service than those who do not as outlined in this Ipsos Mori report.
The intangibility and the fact that production and consumption take place at the same time means that the service provided may be slightly different every time. This has significant advantages in terms of customisation and innovation. But it is also costly and can lead to dissatisfaction if a minimum service level is not met.
So a service experience, like a rock concert, may be different every time. Take for example Bruce Springstein’s recent Hyde Park gig where he sung the song, Take Em As They Come, especially for one of his fans in the crowd. The flexibility of many services allows for this sort of innovation and customisation. However, this may be experienced by different people in different ways – even at the same time. The need for some control is also highlighted by the fact that the same Hyde Park gig ran over time to such an extent the organisers were forced to turn off the speakers in order to comply with the terms of their licence.
Nonetheless, the more a service is standardised (which improves efficiency) the less personalisation can be achieved (potentially affecting effectiveness). Imagine if a barber gave every customer the same hair cut. It might be very cheap and efficient but would almost certainly affect customer satisfaction. Given the increasing focus on efficiency over effectiveness it is perhaps not surprising that public attitudes towards the NHS are falling.
These factors, when taken together, mean that services are very difficult to manage. When you include the publicness of public services, as well as the complex problems many such services have to deal with, it is perhaps not surprising that they are not always perfectly efficient. Indeed it has been pointed out on this excellent set of posts by Flip Chart Fairy Tales (Part 1; Part 2) just how difficult efficiency gains are in service industries.
This is not to say that we shouldn’t even try to create efficiencies – but it might help to start with realistic expectations.
Hochschild, A. (1983) The Managed Heart: Commercialization of Human Feeling. California: University of California Press.
Lovelock, C. and Gummesson, E. (2004) “Whither services marketing?”, Journal of Services Research, Vol. 7 No.1, pp.20-41.
Zeithaml, V.A., Parasuraman, A. and Berry, L.L. (1990) Delivering Quality Service. New York: Free Press.
NB: This was originally posted in 2012. As of September 2018 I no longer work at Queen Margaret University. As such some of the links on the below post may no longer work. For information about my current post please go to the about me section of this website.
Focus and purpose
Queen Margaret University has recently developed the first ever Postgraduate Certificate in Public Services Governance. This is due to commence in September 2012. But what is Public Services Governance?
In later posts I want to look at the question of why public services rather than, say, public sector governance. But right now I am going to look at the question of governance.
Why governance and not administration or management? And what does this mean for the philosophy and content of our programme?
The purpose of this blogpost is to outline how our Public Services Governance programme differs from the more commonplace Masters in Public Administration (MPA) or Public Management courses.
Definitions of Public Governance
One of the challenges in developing a programme in Public Services Governance is that there are a number of differing definitions and even a number of different labels such as Public Governance / Responsive Governance / Network Governance / Public Services Governance. I’m not going to try to provide a comprehensive overview of Public Governance within this blogpost. There are many excellent academic texts, some of which are listed at the end of this post, that are worth reading for a more comprehensive understanding of the subject.
In terms of policy the term started to gain prominence in the 1990’s within a number of World Bank reports (1989; 1992; 1994). In this context the term was used to refer to the importance of good governance in international development. The World Bank defined the term as “the manner in which power is exercised in the management of a country’s economic and social resources for development” (World Bank, 1992). What is interesting here is that the term is not specific to government or the public sector but involves all those with a role to play in international development.
From Public Management to Public Governance
The term public management, or New Public Management (NPM), is now a familiar term across academia and the public services. This term came to prominence within academia and policy-circles in the 1980’s and 1990’s. This period saw the fall of the Berlin Wall, publication of Francis Fukuyama’s (1989) End of History thesis, and the rise of a neo-liberal consensus across many western States. It was within this context that New Public Management emerged as a set of management tools (largely borrowed from the private sector) to improve efficiencies. Typically this consisted of:
(OECD, 1993 as cited by Bovaird and Löffler, 2003: 17)
In education this led to the development of many public sector specific MBA’s (Masters in Business Administration) and MPA’s (Masters in Public Administration – though perhaps not so much in the UK.
Invariably these degree programmes consist of a number of generic management subjects such as human resource management and strategic management with some public sector examples tagged on. I certainly wouldn’t downplay the value of many of these degrees. But at Queen Margaret University we wanted to offer something distinctive which reflected the most recent debates in public service development and delivery.
Rationale for Public Services Governance programme
There are three key factors which have contributed to the design of our public services governance programme:
Elke Löffler summed up the rationale for a distinct public governance programme when she stated,
‘public agencies no longer only have to be good at getting their internal management systems right – financial management, human resource management, ICT and performance management – but they also have to manage their most important external stakeholders as well’ (Löffler in Bovaird and Löffler, 2003: 163).
This is not to say that NPM is no longer relevant. I share Bovaird’s view that the realms of public management and public governance are separate but interconnected (2003: 11). Nonetheless, in line with Osborne (2010), I do think public governance is worthy of study in its own right. It was this belief that led to the development of our Postgraduate Certificate in Public Services Governance – the first ever postgraduate course with a focus on public governance.
Programme Aim and Contents
Within our programme the key aim is to enable learners to:
Modules are focused on themes and issues within public services governance – rather than focusing on managerial functions. Modules include:
More to follow on these modules in later blog posts. In the meantime you can read about the rationale for inclusion of Engendering Policy and Practice.
UPDATE (Posted 04/02/2016)
Since first publishing this blog we have successfully delivered the PgCert Public Services Governance to many students. We have worked with Academi Wales to offer the programme to public service officials from across Wales (more on that here).
Subsequently it has become clear that there is significant demand from an international audience for Masters level programmes with a governance focus. Much of this experience has informed our development of the new Master of Public Administration (MPA) programme. For more on this programme see ‘What is an MPA‘; the course leaflet; and some further resources via FindaMasters.com.
Some Useful References:
Bovaird, T. and Löffler, E. (eds) (2003) Public Management and Governance. Routledge: London.
Fukuyama, F. (1989) ‘End of History?’, National Interest, No 16, pp. 3–18.
Osborne, S. (ed) (2010) The New Public Governance. Routledge: London.
Pierre, J. and Peters, B.G. (2000) Governance, Politics and the State. MacMillan Press: Hampshire.
Rhodes, R.A.W. (1997) Understanding Governance. Open University Press: Buckingham.
Stoker, G. (2004) Transforming Local Governance. Palgrave: Hampshire.
World Bank (1989) Sub-Saharan Africa: From Crisis to Sustainable Development. World Bank: Washington, DC.
World Bank (1992) Governance and Development. World Bank: Washington, DC.
World Bank (1994) Governance: The World Bank Experience. World Bank: Washington, DC.