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.

I remember soon afterwards being told about Management by Objectives (MBO). A colleague had completed an assignment as part of his degree, which looked at the application of MBO in local government. He obviously thought I should be applying theory in my work, and I was attracted to the idea of putting more structure around my management. Thanks to Wikipedia, I have refreshed my memory about MBO, an idea developed by the management thinker Peter Drucker:

Management by objectives is the process of defining specific objectives within an organisation that management can convey to organisation members, then deciding how to achieve each objective in sequence.

At the time I even bought a copy of The Practice of Management (written in 1954) and read it from cover to cover. My exposure to MBO reinforced my view that management needs structure and focus, but not much changed in what I could do. At that time (early 1990s) the idea that the council would say what it was intending to do and then systematically plan to do it, was novel. Mostly, we just did the same thing this week that we did last week, and this year what we did last year. Nobody questioned it.

Some of us thought we could do better. I was one of the first university-educated managers and I had been exposed to international lecturers with new ideas to Australia. I wanted to do things differently and better. My next foray into management ideas was Total Quality Management (TQM), which has been attributed to the management thinker W. Edwards Deming. I led a pilot program at the council where I was working. Thanks again to Wikipedia:

Total quality management consists of organisation-wide efforts to “install and make permanent a climate where employees continuously improve their ability to provide on demand products and services that customers will find of particular value”.

Again, I bought a book, this time on TQM (long ago given away). Practicing applying TQM as a pilot showed me the difficulty of leading change in local government, especially from an operational area. The resistance was instant from internal support services (their nose was out of joint because they weren’t deciding how the council would improve) and it died a natural death. Along the way though, our Quality Circles using ‘PDCA’ (plan, do, check, act) had identified lots of opportunities for improvement. We made some good changes.

Then, someone lent me a copy of Henry Mintzberg’s book Rise and Fall of Strategic Planning, which, as it turns out, influenced me strongly. It helped me to see that the way we understand and deal with work today is the basis for improving it in the future, and that writing detailed plans, even if they are based on knowledge of the work, doesn’t work because strategy emerges while you are doing the work. It was a bit like John Lennon and his saying that ‘life is what happens while you are making plans’.

The next management idea to come along in local government was Business Process Reengineering (BPR). Championed by Michael Hammer, it suggested that understanding the work as a process and redesigning work flows would make services better. I bought this book as well. Wikipedia has helped me out with the essence of what he was saying:

Business process re-engineering is a business management strategy focusing on the analysis and design of workflows and business processes within an organisation to help organisations fundamentally rethink how they do their work in order to improve customer service, cut operational costs, and become world-class competitors.

Around this time reforms of local government had started in the UK and there was talk of them happening where I was working in Victoria. Sure enough, the reforms arrived in Victoria with the election of a conservative State government. We got municipal amalgamations, forced rate reductions (20%!), and Compulsory Competitive Tendering. Whilst most people working in the sector would have agreed change was needed, with the benefit of hindsight, the baby clearly went out with the bathwater. It was a time of huge redundancies, cutbacks and chaos.

I left local government and started my own business (and a Master of Business Administration (MBA)). I had decided that after getting a job as a manager, and clearly having some aptitude, that I would be even better with some education. I have found this not to be a common view in local government in Victoria.

Nonetheless, the MBA introduced me to a (what seemed to me) revolutionary field of management research, thinking and writing – operations management. I had discovered the thinking that tied together MBO, TQM and BPR. For a while it changed the way I thought about everything I did. Ideas like the operational typology and performance objectives became fundamental to my thinking. I designed services around these ideas in my business.

For the benefit of completeness, yes, I did buy the book. Operations Management 2nd Ed by Nigel Slack and his colleagues became my new bible. Again, Wikipedia has helped me with a definition:

Operations management is an area of management concerned with designing and controlling the process of production and redesigning business operations in the production of goods or services.

I loved the idea that operations were designed and that they could be controlled to produce more reliable products and services. I discovered that everything else I had experienced or studied, was really just a subset of operations management, even the emerging field (at least in local government) of Project Management.

A pattern was emerging – I found value in ways of understanding services as processes and engaging workers in improving them. Interestingly, around this time I found an article Peter Drucker had written in the 1970s about public sector management. It challenged my thinking about what I was seeing and learning. I will come back to it in Part 3.

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

208 – Improving service operations. Implement with motivational interviewing.

Posted by Colin Weatherby                                                                               500 words

innovation diffusion

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Earlier posts have described how to improve service operations by developing a service action plan and redesigning services. This post looks at how to implement a redesigned service. You may have noticed that not everyone is excited by the prospect of change.

Having said that, some people like change. Others could be frustrated by the current situation. These people could be innovators or early adopters who will readily accept the need to change. The Rogers Innovation Diffusion Curve shows the rate at which a new idea spreads through a group.   In any group contemplating change you are likely to have people from each of the groups identified on the curve. Some are going to accept the change more easily than others.

A colleague recently taught me a useful way to help all groups, including the laggards, to engage with new ideas. It was demonstrated by Gregory Bayne of Total Leader and Coach Solutions, Australia.  It is designed to overcome resistance to change and is based on motivational interviewing techniques. Continue reading

205 – ‘We don’t need to be clever – just less stupid’, The Age 23 February 2016.

Posted by Colin Weatherby                                                                         700 words

Dont need to be clever just less stupid image

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I read this article and though it was fortunate that the writer, author and polymath Satyajit Das, hadn’t been dealing with his council. No doubt a greater attempt would have been made to feign ‘one stop’ service but if it was anything but a simple matter, he would have come across the same dysfunction. His acuity is evident in his analysis.

Das’s dealings with his bank highlighted how the quest for efficiency and lower costs has achieved the opposite result. This is a recurring theme in the writings of John Seddon about the public sector. Das lists six sources of ‘unproductive and inefficient’ failures that he believes are now common in many organisations.

  1. Tasks have been fragmented across different locations and the simplest activity is now complicated.
  2. There is no continuity. ‘One person is not accountable for the complete activity. Workers lack any idea of how what they are doing, or not doing, affects the whole process overall’.
  3. Staff lack the skills and knowledge required.
  4. Performance measurement has lowered, rather than improved, performance. Staff actions detract from results instead of helping achieve them.
  5. Leadership is lacking in ‘domain knowledge’ (i.e. valid knowledge in a particular area).
  6. There is a tendency to see history as old and irrelevant. The latest technological wizardry is the best solution to any problem. Valuable lessons from the past are routinely ignored.

There have been a number of posts on these very topics. Continue reading

202 – Essay No. 6 – Local government and public value.

Posted by Lancing Farrell                                                                                              6500 words

bureacracy

Value is often mentioned in local government when talking about services, particularly ‘best value’. However, there is often inadequate understanding about the different types of value, the difference between private and public value, and how value is actually created and managed by an organisation. Sometimes there is the assumption that because we have been busy, that we must have created something worthwhile.

This essay brings together ideas from several earlier posts and is constructed around four hypotheses:

  1. That there are different types of value created by organisations and for local government public value is the most important.
  2. Public value is the primary value that must be understood and delivered if councils are to deliver what is expected by the community.
  3. Value-led management is a way of managing that could transform local government and make it more responsive and effective in serving the community.
  4. There are simple and effective tools that can be used to improve value creation in local government.

Hypothesis 1: There are different types of value and public value is the most important for local government.

Private value

In a metaphorical sense the value that you add is what you ‘bring to the party’. This is determined by what other people think you have contributed and by thinking about what the party would have been like if you hadn’t arrived.

There are different types of value and it is worth briefly considering the difference between private value and public value. Public value is the collective view of the public or community about what they regard as valuable, especially with regard to the use of public money and authority. Moore describes this as occurring along a spectrum from value that is obtained from public services that is essentially private value, similar to the concept of customer value, to public value that reflects the aggregate value expectations of citizens.

Moore degrees of publicness

At the private value end of the spectrum, the focus is on the individual service recipient and delivering value that satisfies their expectations.   At the public value end of the continuum, the focus is on achieving the social outcomes sought by the community or public. Continue reading

200 – Using a local government service catalogue.

Posted by Colin Weatherby                                                                                                                         700 words

menu

Some time ago I discussed how to create a local government service catalogue. The process was simple and effective in describing services in customers’ terms and linking services to cost centres in the budget and those responsible for the cost centres. You might ask, what else needs to be done? Well, for the service catalogue to be really useful it needs to be linked to the organisational planning processes. Here’s how that can be done.

To begin, it is a good idea to test the service catalogue with the community. I have heard of a council using it to lead discussion with ‘peoples’ panels’ about the services delivered, how rates can best be spent, and whether or not the council should seek an exemption from the municipal rate cap being imposed in Victoria. If the community can relate to the services described in the catalogue and understand what they involve, it is likely that you have got the catalogue right. It doesn’t mean that it can’t be further improved, but it is a good start.

The next step is to link the service catalogue to the traditional ‘business unit by business unit’ planning that occurs in local government. Continue reading

194 – Essay No. 4 – Local government and customer service.

Posted by Lancing Farrell                                                                              4500 words

basil fawlty

Customer service is, and should be, a major concern for local government. After all, councils are service organisations. Sometimes there is confusion about exactly what customer service means, how it relates to public service delivery, and what aspects of service are most important to get right in local government.

This essay focuses on three hypotheses:

  1. That ‘customers’ in local government are different to the customers described in most customer service literature and encountered by most service organisations.
  2. There are six main opportunities for local government to improve service to customers.
  3. There are simple tools available that can assist councils in getting service delivery and customer service right.

Continue reading

189 – Essay No. 2 – Local government, effectiveness and efficiency.

Posted by Lancing Farrell                                                                              3300 words

false economy cartoon

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People in local government regularly discuss effectiveness and efficiency. Often this happens in relation to pressure on revenues, such as rate capping. Most of the discussion centres on efficiency rather than effectiveness, and opportunities to stop delivering those services that are seen as ‘cost shifting’ from other government. The efficiency discussion is often not well informed. Frequently it focuses on inputs while ignoring outcomes and public value. Any savings are usually equated with cost cutting, not creating the same value at lower cost.

Australian researcher and writer Christopher Stone has published several papers on ‘false economies’. Each addresses a different aspect of productivity and efficiency in the public sector.

“Everyone has the right to know that money is not being wasted; that it is being spent as efficiently as is possible.” Christopher Stone, Decoding Efficiency, April 2013.

So, what is efficiency and how does it differ from effectiveness? Continue reading

171 – A series: Managers as designers in local government. Part 3.

Posted by Lancing Farrell                                                                              500 words

design and thinking

This is the third post in a series of four. It addresses some of the challenges to design-thinking.  Jon Kolko has identified several.

His first challenge is accepting that you will be dealing with more ambiguity.

“It is difficult if not impossible to understand how much value will be delivered through a better experience or to calculate the return on investment in creativity.”

He says that ambiguity doesn’t fit well with organisations that value ‘repeatable, predictable operational efficiency’. This will be an issue for councils seeking to use design-thinking. For councils, there is an expectation that value will be created through efficient use of resources without any waste. The strong risk aversion of local government reinforces elimination of uncertainty, or at least pretending it has been eliminated. Embracing a culture or experimentation, customer value creation and risk taking will be very challenging. Continue reading

169 – A series: Managers as designers in local government. Part 2.

Posted by Lancing Farrell                                                                              800 words

rapid prototyping

This is the second post in a series of four. It discusses the second and third principles of design-thinking.

Models can be used to examine complex problems. In this context, the ‘model’ is an artefact of the design process that is used to ‘explore, define and communicate’. Typically this will include diagrams and sketches instead of (or in addition to) the spreadsheets and specifications usually used to analyse and resolve problems. According to Kolko, they ‘add a fluid dimensions to the exploration of complexity, allowing for non-linear thought when tackling non-linear problems”.

There are a number of local government services that routinely use models or design artefacts in their work. Continue reading