Results Based Strategies & Plans in NZ’s Public Sector

Relevance to ADB & yourselves?

1. Not about a road map2. Not about poverty reduction (in your setting)

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Sector Results: Why Bother?

Quantity Quality Coverage

Input

Output

Outcome

REDUCINGPOVERTY (EFFECTIVE

MANAGEMENT)

EFFICIENT MANAGEMENT

Evolution of Governance

BASIC GOVERNANCE

APPROPRIATENESS OF EXPENDITURE

ECONOMY & EFFICIENCY

EFFECTIVENESS & VALUE-FOR-MONEY

· “Knowing what money is spent on”· Sustaining leadership, institutions & systems that give

confidence money will be spent responsibly· Focussing on aggregate fiscal responsibility & outputs

· “Interventions that could meet major needs get funded”· Ensuring money is at least focussed on priorities & real needs· Logical checks confirm intervention mix & targeting matches

needs, & is at least capable of producing the results sought

· “Better manufacturers & technologies get funded”· Trying to maximise capacity to benefit citizens, by funding

quality outputs produced at low cost (may be wrong output)· Measuring / benchmarking input & output costs

· “Most valuable products get funded”· Trying to maximise benefit to citizens, by funding outputs

that can be shown to work & (ideally) are cost-effective· Defining expected results, & showing outputs deliver them· Comparing results of unlike outputs

NZ:

1980s ?

1990s ?

Now

Advice to Leaders & Managers

• Leaders must create demand• Staff must support their work• Evidence trumps opinion every

time (Risk: culture trumps evidence)

• Focus: ‘big’ strategies / interventns • Prioritise, & be pragmatic• Set yourself a challenge

• Organise information & analytic outputs to support ‘big’ decisions & reshape ‘road map’ over time

POLICY &OPERATIONAL

MANAGERS

PLANNERS &BUSINESSANALYSTS

STRATEGIC &OPERATIONAL

PRIORITIES

MINISTERS &SENIOR

MANAGEMNT

PERFORMNCE

MONITORINGEVALUATION

EVALUATIONPLAN

SYNTHESIS ANDRECOMMENDATIONS

Why Bother with Strategy?

• Strategy matters• Some strategies matter more than others• Strategy is the starting point for deriving

appropriate action (not the ‘sum of current actions’)

• Poor structure & evidence base caused us to review strategy design as part of MfR

• Priorities should be evidence based, not discipline based (so beware of some economists!)

Background to NZ’s Strategy Primer

1. Many strategies – priority & links unclear

2. Poorly specified outcomes, results

3. Based on uncertain needs & demand

4. Lacked specificity on actions, timing & cost

5. Limited monitoring of results

6. Few groups with clear mandate to learn from experience & redraft the strategy

Strategy Design & Review

1. Focus on big, tractable issues that dominate the area 2. Target significant change for the poor (evidence of

major need(s); measurable results; tangible goals) 3. Use evidence to justify the big interventions (e.g. of

need, impact and cost-effectiveness) 4. Be clear about what must happen, & when. Plans that:

– Show how major results will be demonstrated– Specify delivery and performance measurement outputs– How major constraints and risks will be managed

5. Lay out clear governance, assessment & feedback processes to adjust the plan

(Further information on each area is on the rear page of the ‘Strategy Primer’)

Proving Strategies & Major Interventions Work

Major ‘Community’ Outcomes (Indicators) Are Improving

First Major Intervention

Second Major Intervention

Other Major Interventions?

MAJOR INTERVENTIONS ‘WELL MANAGED & WORKING WELL’

Reduce Social Cost of Death & Serious Injury from Road Accidents

Improve Roads

(e.g. engineering)

Ends:

Means: Improve Vehicle Mix(standards & testing)

Improve Driving

(licences & enforcement)

MajorInter-ventions:

Dangerous corners

Intersections

Road surfaces

Ease of overtaking

Speed control

Breath testing

Young drivers

Use of seat belts

Import standards

Yearly test standards

Spot checks, helmets, etc

Incentives (e.g. taxes)

Analysis: “Show aggregate results”; “Follow the money”

Funding Major Interventions

Pre-conditions of funding:

1. Address needs that remain relevant (what, where, who?) 2. Ends (outcomes, goals) & means (outputs, coverage) map to #13. Systems to validate performance vs. clear specification

Ongoing funding:

4. Efficient (& cost-effective)5. Meet quantity & quality standards6. Reach & positively influence groups with needs 7. Reduce needs (improve outcomes) used to justify funding

MfDR thus provides ‘funding tests’ & learning opportunities

Basket of measures linking services to user expectations

Inputs

Outputs

Outcomes

Efficiency

Value-for-Money

Effectiveness

PRODUCTIVITY MODEL

Quantity

Quality

Coverage

Near TermResults

IntermediateOutcomes

End Outcomes

Funding

Resources

Economy

AllocativeEfficiency

Equity

Access

LOGIC MODEL

Major Strategies & InterventionsMajor Strategies & Interventions

Policy … Design … Planning for Feedback … then Action

Plan(where do we want to go?)

Measures(how will we know when

we get there?)

Do(to implement the plan)

Report(did we reach our goal?)

The Policy Management Cycle: After Heather Daynard, Prospect Management Enterprises Inc, Canada

Crucial Roles of Senior Managers & Aspirants (2)

• Provide & promote leadership• Demonstrate performance by simplest means• Assess & promote staff based on MfDR

contributions & competencies• Delegate, in return for accountability for delivery• Eliminate activities with weaker value-add• Establish ‘systems’ required to support MfDR

Making Space for MfDR

Input Far less rules-based

Process Scope for negotiation

Product Attributes Strong focus (no savings?)

Systems (Integration) Strong focus (but not a major effort after they have been set up)

Results Focus Strong focus (effort reduces if robust systems in place)

“Accountability, in return for Freedom to Manage”

RESOURCES

Leadership Roles Crucial (1)

• Ensure strategies, CSPs, portfolios, sector plans, etc clarify what needs (outcomes) are targeted for whom, how & why. Ensure strategies, plans, reports & other products work from outcomes (ends) to actions (means).

• Deliver monitoring systems as well as outputs. Summarise key results in time to support leadership decisions on strategy, priorities, output, etc

• Adapt strategies & plans in response to new information

• Focus judgements on contributions to poverty reduction

Inducing Change

Key Principles & Learnings in Main-streaming MfDR

3.00 pm

Organisation & CultureAccentuating the Positive

Accept responsibility for achieving outcomes Renew intellectual capacity & agency creativity Integrated set of initiatives – backed by evidence

(add new initiatives to build on momentum / gains)

Analytical rigour / honesty, not mgmt. paraphernalia

Reduce real complexity to ‘workable dimensions’ Active risk-taking, not passive risk avoidance Build sector-wide knowledge, people, teams

After Tony Bliss, LTSA (NZ) & World Bank

Roles of Senior Management

Accentuating the Positive

Strong leadership - Ambitious vision & targetsManage outcome-output links within limits of

performance. System change to surpass limits (Shifting leadership, system, production & measurement frontiers)

Fund portfolio of investment & near-term outputsBack evidence, esp. vs. conventional wisdomManage productive multi-agency partnerships,

coordinated at senior levels (often CEO to CEO)

Tony Bliss, World Bank

Directors Powerful & Influential• LT & MTS• Policies, subsidiary strategies• Cross country comparisons & priority setting• CSPs, priority setting & monitoring• Sector direction & strategy• Delivering & monitoring portfolios & projects

• Appointment, assessment & promotion• Allocative decision-making (planning & budgeting)

• Project design, approval, management & review• Roles, delegation, accountability vs. freedom to manage • Incentives (rewards, risks, punishments) • Nimble, flexible, responsible, accountable

Making WavesMaking Waves

COMMUNITY OUTCOMES

ORGANISATIONAL OUTCOMES

REGIONAL OUTCOMES

TEAM OUTCOMES

CASELOAD OUTCOMES

CLIENTOUTCOME

(Influencing Actions)

Will MfDR Go Away?No. It will evolve.

WHY? Your Mission

Your ManagersYour Shareholders

10:00 am

Self Assessing Our Progress in MfDR

A tool to help organisations consider their progress in results-based management and identify their

capability development objectives

Goals for an MDB Tool[1] Boards, leaders and managers will be

better able to identify: – where and how well we are managing, and

embedding & practising results-based management at lower levels

– what needs to be done to gain further progress in MfDR

– what our development priorities are

[2] Communicate expectations to our staff

The Tool (1)

• Self-assessment: not accountability mechanism• Results subjective: not comparable across units • Designed to be flexible, adaptable & applicable

at agency, department, division, unit levels • Use iteratively to gauge progress & set goals • KISS: Cannot be all encompassing (e.g. change

management not covered in NZ version)

Likely Structure

• Simple introduction

• Focus on a small number of questions on key dimensions of performance (MfDR)

• Keep questions simple, short, generic• Describe stages of development (scale)

• Overview (pulling the self-assessment together)

• Must cover key aspects of MfDR …

• Directors have helped us identify priorities for the ADB, and added new messages

• Feedback will be used to build MDB tool

• Will evolve on the basis of later feedback from directors & other senior managers

• Learn from others

Tool for the ADB

Assessment Components(NZ Tool)

1. Clarity about ends & means (strategy & plan)

2. Capability required (planning, delivery, learning)

3. Assessing progress in implementation

Big Question for the ADB & MDBs: What bits of the model must be protected, & how must it be adapted.

You will be asked for your opinions shortly …