236 – Organisation design in local government

1000 words (9 minutes reading time)                                      by Colin Weatherby

I am intrigued by the thinking behind council organisational restructures. It seems that every new CEO feels the need to redesign the organisation to make it work better. Are they successful? The question on my mind is, how can a restructure make the organisation perform better?

I recently came across a useful publication on the topic that has been provided by the Victorian Public Sector Commission. It is entitled ‘Organisational Design’  and is part of the Leading Public Organisations’ series. The intention is to provide ‘prompts, thought starters, practical ideas, and reminders for leaders and managers working in Victorian public sector organisations’.

There were certainly some useful reminders. In the first section on ‘the basic concepts’, the reminder is that organisational design is a consequence of the organisation’s goals, the work it needs to undertake, how that work is divided up (and how the bits are then connected, especially information flows), and how the work will be authorised and governed. The design is communicated through formal documents (e.g. the organisation chart, position descriptions, instruments of delegation) and informally through workplace practices (i.e. ‘the way things are done around here’). The design is also dynamic and changes in response to formal decisions (e.g. work allocation) and evolutions in practice (i.e. the workarounds that develop over time). Some useful reminders.

For public organisations, the authors have picked out some special considerations related to predetermined decisions outside the control of the organisation’s leaders. For example, the boundaries of a public organisation is often determined by legislation. For example, councils have a defined municipal district and set of roles specified in legislation. Councils in Australia must deliver the policies of the State and Federal government and comply with their decisions. Legislation also requires councils to be the local provider of State services, such as town planning and building controls, domestic animal management, public health and road management. These can be real constraints on a council trying to design their organisation to best meet local needs and priorities.

The impact of external factors is significant. I know of one rural council that has determined their total annual budget is required just to provide the services legislated by the State government, without any of the other services local people have decided they would like (e.g. libraries, sports facilities and better parks). This highlights the problem being created by rate capping in Victoria. Councils are being reduced to the local branch of the State government.

There is also some useful advice. In the section dealing with ‘when to redesign’, the compelling reasons for redesign are listed as changes in the external environment, an externally imposed restructure (e.g. municipal amalgamation), change in organisational strategy, failure to deliver results, or a compelling opportunity to improve. The less compelling reasons the authors have identified (a diplomatic way to describe them) are interesting.

They start with a new leader redesigning to make their mark or create an organisation that they are more comfortable leading (i.e. recreate an organisation that they are confident to lead).  Then they describe leaders wanting to make the organisation design appear more logical on paper or balance workloads. Both are less important than responding to strategy and the best way to do the work. The last two reasons relate to key staff member performance, either good and bad, and restructuring to accommodate them. We have all seen restructures for these reasons.

This image has an empty alt attribute; its file name is organisation-design-messages-image.png

I will close with a summary of their last eleven sections (it is worth looking up and reading). This is where the authors provide advice on how to redesign an organisation. A couple of key pieces of advice that stand out include:

  • Start with strategywhat will/won’t the organisation do in order to meet the needs and expectations of stakeholders and make the best use of available resources.
  • Treat redesign as a project – have a clear scope, distinct tasks, defined accountabilities, a timeline, achievable milestones, and adequate resources.
  • Document the design – the organisation chart shows the formal reporting relationships and accountabilities, and it needs to be accompanied by documents describing the relationships with external stakeholders, how information will flow, and the ‘operating and care instructions’ for the new design (e.g. accountabilities, delegations, governance and decision making, activity process maps, and position descriptions/role relationships).
  • Test the new design – are the legislative requirements of the organisation being met? (e.g. use the RACI model – Responsible, Accountable, Consulted, Informed). Are community and customer needs being met (i.e. How many touchpoints are there? Are the channels adequate? How easy is it for the customer?). Is the organisation being effective and efficient (i.e. review end to end processes – How many people are involved in delivering a service? How many hand-offs are required? How many IT systems are being used? Is there a continuous improvement process in place?). Does the design work with culture? (i.e. Does it support and promote a constructive culture? Does it damage existing aspects of culture? What values and behaviours are likely to emerge as a result of the design?). Finally, how does it manage risk? (i.e. Are gatekeepers in the right roles? Who will be the first person to know when there is failure?).
  • Ensure the authority structure works – Are decisions being made at the correct level? (i.e. Does the decision maker have the requisite knowledge and information required? Is the impact of their decisions on the organisation at the level expected?). Where decisions are made in an organisation is one of the clearest insights into the informal organisational design.
  • Make sure the parts are connected – dividing an organisation into component parts can be relatively easy but ensuring they work together can be difficult. Are the formal and informal connections effective?

For those contemplating a new organisation design, or even trying to understand how the one they are currently in works, this is a very useful guide. Keep it handy.

235 – My experience of management thinking in local government – Part 3: The frustrating years.

1000 words (9 minutes reading time)                                                        by Lancing Farrell

management experience pt 3

This is the last post on my experience of management thinking in local government. Writing about it makes it seem like a long haul. With hindsight, there have been lots of interesting ideas, many with potential value to improve services, but few with any practical method to make them useful. And less with a way to implement them across a diverse organisation like a council.

Sometime around 2017 I went back to seriously read more of John Seddon’s writing about the Vanguard Method. At this time, Vanguard had a launch for their Australian office in Melbourne, and I went along. Several Australian organisations, public and private, talked about their experience using the Vanguard Method. I wanted to know more. In 2018 I had the opportunity to fly to London and attend a masterclass on digital transformation being held by Vanguard. I met John Seddon and other senior staff from Vanguard. I also spoke with people from local government in the UK who had experience with the Vanguard Method.

This was fortuitous in the development of my thinking. After three decades I had arrived at an understanding of local government and the way it works that made me think systems thinking was the best way to improve the performance of services. The Vanguard Method provides a way to implement systems thinking that has been tested and proven in local government. It provides the method lacking in Public Value. It works with the culture prevalent at many councils.

Amongst the various counter-intuitive truths that John Seddon describes, the idea that you don’t change culture by setting out to change it, or reduce costs be setting out to cut them, had started to really resonate with me. It is an ‘obliquity’ problem. Like happiness, the harder you try to achieve it, the less likely you are. It comes from doing something else.

This doesn’t mean that I don’t respect the thinking of reductionist management writers I have studied. For example, I am sure that Henry Mintzberg, Peter Drucker and Gary Hamel understand the problems they write about. However, their advice doesn’t help you to act on the system. Likewise, Nigel Slack and his colleagues have lots of useful ways of understanding operational problems and helpful tools to work on solving them, but not an approach to improving the whole system.

Systems thinking makes a lot of sense in a local government environment. Our customers, the citizens in the community see what we do as interconnected. They see the system, or at least the need for one. They interact with every part of what we do. And they force us to integrate what we are doing, even when we don’t want to. They don’t want to hear us say ‘I’m sorry, but that is another department’ or ‘its not us, its the contractor’.

Alistair Mant makes the contrast between systems thinking and reductionist management crystal clear in his comparison of bicycle and frog systems – reductionists see systems (to the extent that they see a system) as being like a bicycle that can be taken apart and each component improved separately, and the bicycle reassembled to work better than ever. Thinkers like John Seddon and Russel Ackoff see systems as being like Mant’s ‘frog’ systems – the components are not so easily disassembled and improved without affecting the whole, and the reassembled frog probably won’t perform as well as it did before disassembly!

I mentioned earlier that I would come back to Peter Drucker. In 1973 he wrote an article entitled Managing the Public Service Institution. It is worth reading.

Drucker looks at why public service organisations are less efficient than business enterprises. He reaffirms public services as the ‘load-bearing members of the main structure’ of modern society, providing services that are essential to society. Despite this importance, he says the performance of public service organisations is unimpressive.

They have large budgets and require ‘ever-growing subsidies’ but are providing poorer service. Citizens are complaining about ‘bureaucracy and mismanagement’ in the institutions that are supposed to serve them.

Drucker saw public service organisations as reacting to criticism by becoming more management conscious and adopting the concepts of business management. He saw it as a sign that they realised they were not being managed, but it did not mean that they understood the problems in managing themselves.

This remains an important point. Councils tend to adopt management ideas from elsewhere (as discussed in these posts). No proven and accepted local government management model has emerged.

Drucker went on to identify examples of public service organisations that were performing well and he looked at what made them different. In doing so, he compared the public service to a business enterprise and noted that the challenges are similar in making work productive, the managers have similar work, and top management is structured similarly. What he saw as different was the purpose. The public sector has a different purpose to a business enterprise.

“The service organisation has performance trouble precisely because it is not a business. What being ‘businesslike’ usually means in a service institution is little more than control of cost. What characterises a business, however, is focus on results – return on capital, share of market, and so on.”

Drucker finishes the paper by listing what he saw as the requirements for public service success:

  • Ask ‘what is our business and what should it be?’
  • Set clear objectives and goals derived from their definition of function and mission.
  • Get managers who do their job systematically and who focus purposefully on performance and emphasis the right results.
  • Think through priorities and to select targets, set standards of accomplishment, set deadlines, and make people accountable for results.
  • Define measurements of performance and use them to provide feedback on efforts.
  • Audit objectives and results to identify those objectives that are obsolete or have proven unattainable, performance that is unsatisfactory, and activities that are unproductive.

I have spent a bit of time talking about this Drucker article to show that not a lot has changed.

The criticisms of local government are the same today. Stephen Goldsmith in his books (The Responsive City comes to mind) dissects in detail the lack of trust in government, growing bureaucratisation of services, and the need to be more responsive to citizens (he describes the ‘Amazoning’ of services and ‘retail government’). And local government is responding to those criticisms in the same way – searching for yet another business management idea to implement that might do the trick.

Now we have lots of new ideas – smart cities, big data, customer apps, nudging, etc. Few of the management ideas that are taken up are ever really evaluated (another point well made by Goldsmith). CEOs introduce them and then move on. Most do not work easily in local government, as I have tried to show in describing my experience at several councils across 30 years.

The challenge today, as I see it, is to work out a way to address the list of requirements put forward by Drucker, and for that way to be focused on citizens. That way is more likely to be effective because it responds uniquely to the management challenges of the council, it works with organisational and community culture, it is quick to implement, and it is proven to be effective across the range of services offered by the council.

My challenge to anyone wanting to knock systems thinking or the use of a method like the Vanguard Method is to ask – if not this, then what?

234 – My experience of management thinking in local government – Part 2: The wasted years.

1200 words (10 minutes reading time)                                                      by Lancing Farrell

management experience pt 2

This second post continues my management journey back into local government. This time into the wasted years – time spent trying different management ideas without success.

Some 10 years later I re-entered local government in a management role. Now we had new management ideas, some even described to me as ‘fads’. In the time I had been out of the sector, the idea of management had gained more currency. I came across Evidenced-Based Decision Making, although as some colleagues pointed out, in practice it was more commonly ‘decision-based evidence making’.

Evidence-based management is an emerging movement to explicitly use the current, best evidence in management and decision-making. It is part of the larger movement towards evidence-based practices.

I found a very interesting sounding book at this time called The Knowing Doing Gap by Jeffrey Pfeffer and Robert Sutton. The title seemed to say it all – how can organisations put their knowledge into action and be more successful? I would like to say this book changed my life, but unfortunately it didn’t. Before I could read it thoroughly, I lent it to a colleague who never returned it. That closed a knowing doing gap for me – don’t lend other people your new books!

I found that Employee Surveys had now become common place. Councils were now being managed by CEOs who ‘took the temperature’ of organisational culture and then developed plans to improve it. I was never too clear on the connection between culture scores and value for customers or the community.

Employee surveys are tools used by organizational leadership to gain feedback on and measure employee engagement, employee morale, and performance.

These surveys tended to show very little change from one survey to the next, even over a decade. It suggested to me that it wasn’t helping (or relevant) but we still did it. Once I looked at a book produced by one of the big culture survey firms and I noticed that our organisational culture resembled the culture of every industry they surveyed in Australia (except industries with lots of international firms). The differences between industries were at the margins. It seems Australian culture dominates in all Australian workplaces.

After a while, I started working at a council that was implementing the Australian Business Excellence Framework (ABEF). As someone who by now was quite interested in what local government thought was good, or even better, excellent management, this seemed like a useful idea. There were lots of other councils using it (some were Gold medallists) and it was an idea developed in the private sector, which had appeal to me after returning from working in my own business. So, I joined the strategy and planning group. The CEO had decided ABEF implementation would start with that category.


The EBEF framework and categories.

I found this interesting because I would have started with Leadership, simply because of its potential to effect change and improvement. Since then I have learned that you can start with any of the seven categories. My question today would be why not start with the customer?  In this time I was able to travel and meet with officers at award winning Australian councils and spent hours studying organisational strategy.

Examining how councuil strategy and planning works only highlighted for me the dysfunction in council strategy development, with various types of plans in a hierarchy (you guessed it, a triangle) with different plans or strategies created at different times and in different ways. None of it was connected in the way the triangle suggested, and, in a surprise to everyone, the group worked out that one of the key plans linking political and organisational actions, didn’t actually exist except in the triangle picture used by the CEO to explain how it worked.

The Australian Business Excellence Framework (ABEF) is an integrated leadership and management system that describes the elements essential to organisations sustaining high levels of performance. It can be used to assess and improve any aspect of an organisation, including leadership, strategy and planning, people, information and knowledge, safety, service delivery, product quality and bottom-line results.

I then discovered Lean and found that it was the new version of TQM or BPR. It seemed to embody similar thinking ideas. I never bought a book on Lean but I started working at a council with a Lean practitioner. He (and many others) spent a lot of time analysing services that weren’t working. Hours were spent collecting data and mapping processes. Days trying to understand what the data was saying and where change might make it better. In the end, while chnages were made, the problems remained unsolved.

My involvement with cross-organisational business processes led me to Karen Martin’s book The Outstanding Organisation, and then her next book Value Stream Mapping. It seemed simple, we just had to learn to understand services as a value stream and then articulate and deliver the value proposition!

A value stream depicts the stakeholders initiating and involved in the value stream, the stages that create specific value items, and the value proposition derived from the value stream. The value stream is depicted as an end-to-end collection of value-adding activities that create an overall result for a customer, stakeholder, or end-user.

Around this time there seemed to be a ‘wave’ of people-based change programs. Leading Teams and The Colloquium are examples. CEOs were clearly searching for ways to act on culture and improve survey results. No doubt these programs were useful, but building people skills wasn’t making the difference CEOs expected. I participated in one of these programs and learned a lot. It was extremely useful to me as a person responsible for managing other people. However, it didn’t help me or my organisation to produce better services.

As an aside to my management journey, in 1995 I had discovered Public Value (yes, I bought Mark Moore’s book Creating Public Value) and the idea appealed to me enormously. Of course, council services are intended to produce the value agreed by people in the community, after all, they are the ones who are paying. In 2013 I bought Mark Moore’s second book (Recognising Public Value) where he illustrates the creation of public value using case studies and describes a way of measuring it (the Public Value Scorecard (PVS)). There is no arguing with the logic of Moore’s strategic triangle, but I couldn’t work out how to use it. Even the PVS was a lagging measure – you would only know if you had succeeded or failed, when you had either succeeded or failed.

I will mention one last management fad that swept local government here recently – User-Centred Design (UCD – there always seems to be an acronym). The council I was working at made a commitment to ‘customer first’ and commenced the analysis and re-design of services using the UCD methodology. We developed personas, customer apps, online forms. It really should have been called ‘digital first’. The problem that emerged was lack of integration between these new and easier ways for customers to deal with us and the actual service delivery systems. It had become easier for customers to make their needs known to us, and to place a demand on one of our service systems, but we were just as slow to respond, and just as likely to fail to satisfy their need.

The upshot of all my thinking and doing was a level of dissatisfaction with the way things are and a determination to find a way to deliver better services. I felt a compulsion to do this as rate capping was reducing our revenues and making it harder to make ends meet. A better way was needed.

Another pattern had emerged – I was now interested both in services as a cross-organisational process, and how you help an organisation to change and improve services.

It was at this time that I recalled some earlier reading I had done on systems thinking and the application of systems thinking in organisations. It started with Alistair Mant and his excellent book, Intelligent Leadership, that I had purchased in the late 90s. I also bought and read David Wastell’s book Managers as Designers in the Public Sector, and through that book came across John Seddon’s book, also from the Triarchy Press stable, on Systems Thinking in the Public Sector. The idea that systems thinking could provide a solution to service improvement became clear in my mind.

I also became convinced that Command and Control thinking (a term used by John Seddon) was a barrier to service improvement. Councils are highly siloed organisations. We like functional specialisation. Each discipline focuses on their work and excelling at what they do. Hierarchy is critical for decision making and it is often the only way that the silos become linked. Senior management have the ‘umbrella’ jobs that integrate work across silos, or at least that is where it can and must happen in a Command and Control hierarchy.

I started looking for more information about systems thinking. At some stage I came across David Stroh’s book Systems Thinking for Social Change. By then I was hooked. There had to be a way of applying systems thinking to improve local government performance in delivering services that provides public value. The challenge was to find a method to do it. The ideas were interesting and well-articulated, but how do you use them to do the work differently?

By now I had begun blogging to communicate with others experiencing the same frustrations as me. It helped me to learn.

233 – My experience of management thinking in local government – Part 1: The formative years.

1000 words  (9 minutes reading time)                                      by Lancing Farrell

management experience pt 1

I was talking to a colleague recently, and I was asked about the management thinkers that have influenced me. It started me thinking back to my early days as a manager in my mid-20s and later when I completed a MBA in my mid-30s. And the lessons I had from starting and then managing my own business for a decade. Many management thinkers influenced me, and, equally, so did my opportunities to practice different ways of managing. This is quite a long essay, so I have split it into three parts.

I recall that before I was a manager, I had an interest in management. I wasn’t too sure what it was but I had read The Peter Principle as a student, and I knew that management was important in organisations if they were to be effective. For some reason I also remember that someone at the council where I started working was talking about Value Management. Now I know that they had obviously been to a course. Then I got a job as a manager. Continue reading

232 – Coronavirus and local government – Financial Impact

1400 words  (reading time 11 minutes)                                                          by Lancing Farrell

Coronavirus financial impact

The focus of local governments has been on employee protection, service continuity, managing disruptions to cash flow and supply chains, and trying to understand the new risks emerging with Coronavirus. It is a whole new operating environment. This post explores some of the financial and operational impacts of the Coronavirus.

Physical distancing has reduced the capacity of facilities by half or more, making appointments and providing concierges has increased staffing requirements at facilities, and there is demand to retain new services like ‘click and collect’ and tele-services introduced in response to the Coronavirus, at the same time as regular services resume.

This is all happening as revenue is impacted by loss of fees and charges, additional expenses in relief packages offered to businesses, and citizens seeking deferral of rates because of financial hardship. Some councils are planning not to index their rates, which is a revenue reduction next financial year and every year thereafter.

At the same time, councils in Victoria are expected to maintain the employment of all staff without financial support from the Federal or State government. Councils adding to unemployment will not help and they need to work out how to live within their means.

What have councils been doing and what do they need to consider doing? Continue reading

231 – A New City O/S – Stephen Goldsmith and Neil Kleiman.

875 words (4 minutes reading time)                                                               by Lancing Farrell

distributed network

I have also been reading Goldsmith and Klein’s bookA New City O/S. It is a very interesting treatise on a potential future model for local government, particularly the argument for distributed governance. As Colin Weatherby has described, it is a researched and expert work.

I found the concept of distributed governance quite interesting. In some ways, all councils already operate using a version of this model for some services. Typically, this would be in community services where the council, State and not-for-profit organisations often combine to provide a facility, grant funding, and the actual delivery of the service. I think it would be a big challenge for many councils to adopt distributed governance across all services because of the loss of control. Continue reading

230 – A way to show performance is determined by the system.

600 words (3 minutes reading time)                                                         Colin Weatherby

95 - 5 Vanguard

Source: Vanguard video ‘Tactics for helping people learn about the 95:5 principle, Part 1′

There have been several posts about performance appraisal and the ineffectiveness of systems designed to improve the performance of individuals. This posts picks up on the key theme of those posts – i.e. a person is not totally responsible for their performance in a system of work and managers need skills in understanding and improving the system.

This has been a compelling idea in my thinking and my work. Despite the many criticisms and problems encountered with people and their work in local government, I have met very few people who come to work to do a bad job. Many years of watching people work and talking to them about their work had led me to conclude that it was the way they were asked to do the work and the tools they were given that created most of the problems. I just didn’t know how to describe it.

Then I read Peter Scholtes’ book ‘The Leaders Handbook: making things happen, getting things done’, and his quote from Edwards W. Deming struck a chord with me:

“The fact is that the system that people work in and the interaction with people may account for 90 or 95 percent of performance.”

Continue reading

229 – Coronavirus and local government – time for a new O/S?

800 words (4 minutes reading time)                                                           by Colin Weatherby

A new city operating system cover Goldsmith

This is the first in a series of posts requested to discuss the Coronavirus and local government services.

I recently read ‘A New City O/S – The Power of Open, Collaborative and Distributed Governance‘ by Stephen Goldsmith and Neil Kleiman. Some time ago I read ‘A Responsive City‘ by Stephen Goldsmith and this latest book takes Goldsmith’s thinking about cities and their governance to a new level. As a former Mayor (Indianapolis), deputy Mayor (New York) and the current Daniel Paul Professor of the Practice of Government at Harvard’s Kennedy School, Stephen Goldsmith is well credentialled to discuss local government.

It is timely to read Goldsmith and Kleiman’s book as local government services adapt to the Coronavirus, react to ensure the safety of staff and the community, seek to understand emerging service demands, and start to look ahead at recovery and the best way to deliver services post-Coronavirus. Continue reading

228 – Frog or bike. Does it matter?

1720 words (6 minutes reading time)                                                                Lancing Farrell

thinking frog

Colin Weatherby and Tim Whistler have made some interesting points in their contributions to the discussion about the Vanguard Method. Clearly, Colin’s colleague has had some success in using it and has been able to identify unique features of the Vanguard Method. In contrast, Tim has raised some legitimate concerns, especially from a local government perspective. I have spent some time thinking about both points of view and reading some of the material mentioned. Here are my thoughts for what they are worth.

Services are complicated and the interactions between the parts, especially when people are involved, is important. Experience says that changing one part of a system does often have unintended consequences elsewhere. Continue reading

227 – Frogs or bikes – I’d love to see that.

600 words (3 minutes reading time)                                                                   Tim Whistler

frog on road

I read Colin Weatherby’s post on the Vanguard Method and systems thinking with some interest. There have been a number of posts on systems thinking on this blog. It is not a new idea. I am intrigued by what makes the Vanguard Method any different to other applications of systems thinking. I am also interested in how it relates to concepts like public value. How does the Vanguard Method achieve better or different results?

As previously posted, I have some interest in the Vanguard Method. I suppose, I am sceptical about the likelihood of any method being taken up in local government if it relies on ‘counter-intuitive’ truths and if there is no detailed plan to say what will be achieved and when. It is always hard to justify expenditure of public funds without a written plan with measurable outcomes – even if everyone suspects the plan is ill-founded or optimistic. If you aim for the stars, if you fail you will at least land on the moon. A plan gives you something to measure the effort against and hold people accountable. After all, isn’t public accountability the aim?

Continue reading