On KPI's and Governmental Organizations

Photo at blog from webmaster - 08/11/2010 - 15:14

This week I got a question from a reader regarding KPI's for a CIO at a Department of Defense. He wanted to know whether we could present KPI's to be fully accountable by the CIO. Now my Results2Match partner, Hans van Nes, once responded to a similar question of a reader: KPI's for a not-for-profit environment.

Why Are Governmental Organizations So Unspecific: Human Nature Prefers Power Play!

In his answer Hans van Nes observes that for private not-for-profit institution there exists a trend to define and measure KPI's. However, for public organizations this is not the case. At least not in the Netherlands. And I think that this is a generic observation, having worked in some 20 plus other countries.

Now why is this? With public organizations the involvement of the 'client', which is the public, with the organization is much smaller than with private organizations. This implies that the influence of power play is larger. The public is far away, and the organization carefully takes care to keep this distance. For a member of this organization something likewise applies. They want to remain as independent as possible, so they can make clear what their exact contribution is, or rather, shall be. Ignore the past as best as you can by subtle letting know your predecessor did his best, but… this is, of course, not enough. Therefore, in their opinion it is best to make sure that all KPI's are incomparable, and cannot be integrated. Hence, there will be no Key Business Requirement (KBR) that describes (one of the) goals of the organization.

Reasonable Requirements (Intellectually!)

The reader is concerned with 2 issues:

  1. CIO should be able to influence a large part of the outcome
    of the KPI.
    Conversely, the value of the KPI can be attributed largely to the CIO.
  2. Clear line-of-sight contribution to the KBR.
    The results of the CIO should be in line with the rest of the organization.

Both are very credible business requirements. Unfortunately, they are not in line with human nature. Only the strongest leaders can work with this sort of statement.

The relevance depends on how the CEO (or Governor, director, mayor, prime minister, Secretary of State) sees his organization. You can implement anything you want, and you can get anything to work like a charm.

If the CEO sees his executive team as a complete unit, being able to establish a serious and reliable way of working, then there should be one set of KPI's, applicable to all: All benefit, and all suffer. All use the same set of KBR's, and base their actions upon that.

If the CEO wants to deal with one person at the time, each with own set of KPI's, then the outcome will be highly political and the dependencies between executive members very small: They will be very accountable, but will the public benefit? The contribution to KBR's will be very vague.

More special is the case of the CIO: Is it a strategic role, ICT enabling the business operation, or is it an operational role. There seems to be no reason for the last role being a member of the executive committee. He can be very accountable for efficiency. Unfortunately an effective ICT is definitely not the same as an efficient ICT.

The Army Example

The readers question regards a CIO of the Department of Defense. In the Netherlands the power of any military employee is much larger than any civilian. And the CIO here is a civilian. He has no authority, what so ever. So, there all sorts of KPI's in place, but that does not reflect the reality: Measuring an effective ICT.

I have been doing quite some work for the Shape Technical Center (part of the North Atlantic Treaty Organization - NATO). But I never considered my work to be taken seriously. In the Netherlands I can quote a very interesting example on ICT. It is said that a general bought SAP. The CIO was successful to reduce the SAP contract with 80% (in words: Eighty percent!) with the help of an independent consultant (Yes, a business relation of Results2Match. By coincidence, do you have an ICT contract you want to have chaecked on a No Cure, No Pay basis?). In this process the CIO did not get much cooperation from any military official.

Ever compared the information systems between land, sea and air-force? And did you find any common system? Or 2 police forces? The same there. It seems that the rule is: Make things as incomparable as you can, and you will survive and being remembered a real champion.

I guess that is life.

We are interested in your opinion. It is very important to us. What do you think? How do KPI's work in your situation? Let us hear from you!

Do you want to implement your ideas on KPi's? Do you want a Quick Scan on your KPI implementation? Or an assesssment of your KPI process? Contact Hans Lodder now!

Or do you want your employees to be able to manage the KPI process of your organization? Let Hans Lodder


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