times Changing Civil service reform. Defining the problems, how to change and who is responsible

Changing times Civil service reform. Defining the problems, how to change and who is responsible. The UK civil service is in the spotlight as never...
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Civil service reform. Defining the problems, how to change and who is responsible.

The UK civil service is in the spotlight as never before. It stands accused of blocking change, both in major areas of national policy and to its own workforce reform programme. Permanent Secretaries and other senior civil servants surely recognise the risks, to the inherited view of the role of the service and to their own jobs. But to make any progress, they need to define what the problems are, how to change and who is responsible. Politicians too, need to take accountability for their critical role in leading system reform. This paper clarifies these issues and poses questions for those involved in leading fundamental change >>

Contents What is wrong?

2

How to change

4

Options for change

5

Government practice in other countries

6

Who is accountable for change?

10

2 Civil service reform

What is wrong? There are clear themes running through successive capability reviews, reinforced by the main staff survey and picked up in the Civil Service Reform Plan1. Taken together, these themes indicate that: n

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The civil service has to become less inward-looking and siloed: integrated thinking and cross departmental working are essential. The leadership, communication and management of change has to improve. Officials need much greater capability in, and accountability for, operational implementation (rather than just the formulation of policy and legislation). Among the mechanisms for change, the management of individual and collective performance must be far sharper – including the management of poor performance. Behaviours also have to adapt, from slow and cautious to innovative and fast paced.

These themes have been present in criticisms of the civil service for many years, and it is it reasonable to ask why so little has changed. Is there no desire to change, or do those in charge not know how? It is perhaps a combination of both – barriers to external challenge and reform will inevitably exist in a career structure that largely grows

its own leaders, and we know that civil service staff’s own feedback suggests a lack of change leadership capability. However, in the nature of this debate, fuelled by publicly available data and by political comment, less is said about other problems which are shared with or directly the responsibility of ministers.

1 http://www.civilservice.gov.uk/about/improving/capability;

http://www.civilservice.gov.uk/about/improving/employee-engagement-in-the-civil-service/people-survey-2012; http://www.civilservice.gov.uk/reform ©2013 Hay Group. All rights reserved

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Structures, roles and relationships at the top of government departments are not always effective or clear. Given the importance of these in setting the tone for the organisation2, there are bound to be problems about direction, consistency of leadership and performance. Areas of concern include the relationship between and respective roles of ministers and senior civil servants; the size and composition of departmental boards; the use of non-executives; and the role of special advisers and their relationship to the core department. The lack of a clear, well founded and planned direction, which is defended and carried through. It will understandably be said that flexibility and responsiveness to circumstances are vital in a democracy but this is not an excuse for the current disconnect between the setting of direction (in departmental business plans for example) and the communication of that strategy into a compelling story. No organisation – including the government and its departments – can succeed without

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all employees knowing where they are headed and what is expected of them. A fundamental, largely unspoken and unresolved debate about what the civil service is for. It could, for example, simply provide an efficient and welloiled machine for implementing political promises. But what if those promises are ill considered or impracticable? Isn’t there a role for independent argument, challenge and rigour? Yet it is not clear that ministers want these things. And from recent policy reversals and implementation difficulties, it could appear that the civil service is supporting and blocking in the wrong ways and in the wrong places.

These concerns are not unique to the UK and some – the difficulty of joining up diverse areas of government in the interests of the public, the force of events and 24 hour news pulling government away from long term plans to short term expediency – are a struggle everywhere. Nonetheless, these are not insuperable problems, and there are useful lessons to be learned from other organisations and other countries.

There is a fundamental, largely unspoken and unresolved debate about what the civil service is for. It could, for example, simply provide an efficient and well-oiled machine for implementing political promises. 2 ‘Senior Leadership Teams: what it takes to make them great’, by Wageman, Nunes, Burruss, and Hackman

(Harvard Business School Publishing, 2008)

4 Civil service reform

How to change A number of ingredients are required to make change effective in the unique context of the civil service. Given the challenges outlined, replicating standard change management approaches would be naïve. A mature approach would include the following. First, there has to be a clear, agreed and well communicated vision and direction – not just about government policy but also about the role and development of the civil service and of each department. The Reform Plan provides a starting point, but the test will only be met when the vast majority of staff can answer the question: what does this mean for me, my skills, role and career? Second, the leadership group – including ministers and executive board members – has to champion the intended changes and speak about them in the same way, sustaining a coherent story about what is required and why. This is not easy given the structures and governance arrangements at the top, and it may call for a level of personal commitment and visible leadership with which policy-trained civil servants are unfamiliar. Unfortunately, leadership and managing change is the second lowest scoring engagement item in the 2012 Civil Service People Survey (after pay and benefits), and is half the level of private sector norms. Third, discussion, communication and leadership have to create sufficient momentum for change to seem desirable or a necessity for most people. This is about winning hearts and minds through engaging leadership behaviours, characterised by leading from the front and communicating with clarity, conviction and enthusiasm. Well publicised disagreements between ministers, civil servants and the wider departmental family do little to create clarity and engagement for staff.

Fourth, there must be practical steps for ensuring and reinforcing change. Improved performance management falls into this category, and like other aspects of reform this has to be role-modelled from the top. Many other practical ingredients will concern the future workforce – how big will it be, what will it concentrate on (and leave to others), how will the necessary expertise and operational understanding be created? There may be useful examples from local government, where some major authorities have redefined what they are and how they will work, and drawn conclusions about the shape of the workforce. Fifth, the civil service and individual departments must measure progress. The work undertaken to date on open data and transparency is welcome and should help make accountability clearer for all. However, failure to progress in vital areas has to have clear consequences and people have to be held to account more in future than they seem to have been so far through the capability reviews. In fact all of these ingredients boil down to the requirement for a fundamental shift in senior leadership behaviour, whether collectively or at an individual level. The Civil Service’s new competency framework3 supports the Reform Plan and successfully defines the future behaviours that will differentiate successful civil service leaders. But, like all well researched plans, the model will deliver no value unless it is intrinsically and consistently embedded into the workforce practices of departments, and unless senior leaders are both developed – and held to account – for championing the new way. The challenge now, as has often been the case in civil service reform, is not the concept, but the delivery of it.

3 http://resources.civilservice.gov.uk/wp-content/uploads/2011/05/Civil-Service-Competency-Framework-Jan2013.pdf

©2013 Hay Group. All rights reserved

Options for change A number of proposals are already in the system, but it is not clear that they add up to a comprehensive and fully considered reform programme. One example is the idea of outsourcing policy development. Certainly there are many more experts on a given subject outside the civil service than within it, and greater use of and partnership with think tanks, universities and other sources of innovation could prove extremely valuable. However, it could also denude the service still further, sucking out the remaining sense of competence and value and leaving a demoralised rump. A common complaint amongst civil servants is that external stakeholders (and even ministers) do not always understand the intricacies of parliamentary process. It will be important to get the balance right. Another example is the suggestion that the civil service will move away from the predominant model of lifelong careers, offering shorter periods of employment to use fresh knowledge and skills before people move on to work in other sectors. This is a move which major companies were making 15-20 years ago, and its benefits are well understood. But if graduate recruits move on after ten years, the only way to obtain high level talent to replace them is to pay a market rate, which the civil service does not, and could not afford, and which would not at the

moment be backed by ministers. Again, there is a risk of a downward spiral of capability, morale and performance. It could be argued that instead of shortening civil service careers, we should keep them the same length but more varied. A total government view of career management could be taken, including local councils, the NHS, education and police – ensuring that no-one could reach the top of the service without multiple operational as well as policy placements, and a secondment to the private sector. Of course, this is a long term approach to the workforce, so it would have to sit alongside other, more immediate measures. It is also important to map out the broad territory of reform. Put simply, the civil service can work to change the people it has, or it can get some different people. In between, of course, it can mix the old with the new. Many civil servants will recognise Macaulay’s famous plea for electoral change in 1831: ‘reform that you may preserve’. They will also understand that it applies to them, right now.

6 Civil service reform

Government practice in other countries It is hard to inject pace along the path of incremental change, but one way is to draw on experience from elsewhere. Ministers and senior civil servants have already been looking at government practice in other countries which might help advance the UK reform process.

Strategy and planning in New Zealand The country’s Better Public Services programme, overseen by the State Services Commission, sets a small number of critical priorities for government as a whole and identifies ten specific results for the government to achieve. A high-level performance

management process supports the programme and cuts across departmental structures. Better Public Services promotes clarity of purpose and of public communication, and encourages inter-agency collaboration to implement change4.

4 Details are on the website: http://www.ssc.govt.nz/better-public-services

©2013 Hay Group. All rights reserved

Talent management in Singapore The Singapore government takes a highly effective system-wide approach to strategic workforce planning, albeit on a smaller scale to the UK. There, the civil service is seen as an elite profession with salaries set to attract both graduates and experienced professionals from major professions and industry. Common

assessment criteria help to smooth and simplify the process of entering the service, while variable bonuses reward high performance. This approach is supported by the flexible Administrative Service workforce, (elite core) who are heavily invested in and rotate between departments.

Experience in Canada The Government of Canada has adopted a whole-of-government framework for reporting to Parliament on progress made across the country. The framework maps the financial and non-financial contributions of departments, agencies, and Crown corporations against sixteen common outcomes within four spending areas – Economic, Social, International, and Government Affairs. All funded departments and agencies align their programmes and report their performance against the

Radical change is also a possibility – drawing on the US system, for example. The current group of senior civil servants should not underestimate the level of

outcome areas, and organisations and individuals are held to account for delivery through a combination of contingent funding and more widespread variable performancerelated pay. In addition, when the government changes in Canada junior ministers stay in their jobs, offering valuable continuity to a department’s work. This goes some way towards mitigating against reduced activity in the run-up to an election.

frustration from politicians, lack of respect from staff and sense of incompetence from the public, and how these three could combine to sweep them away.

8 Civil service reform

Politicians cannot escape their own role in the reform process. It is not enough for them to insist others change; they need to change in many ways themselves.

©2013 Hay Group. All rights reserved

Who is accountable for change? Clearly defined accountability is key; without it, nothing will change. The view that top civil servants are solely responsible must be challenged. Certainly, executive leaders have to drive any internal reform programme, and it is a puzzle to many that this hasn’t happened. However, politicians cannot escape their own role in the reform process. It is not enough for them to insist others change; they need to change in many ways themselves. A combination of clear – even cross party – political will and the right support for those who are not equipped to lead a reform programme will be a start. Take for example the requirement for clear, well founded plans which ministers stick to and civil servants implement for them. This calls for high levels of

resilience and self restraint on the part of political leaders. It might also argue for a shorter list of major commitments: make fewer changes, but make them well. Equally, there have to be clear roles and relationships at the top. This includes selecting the right special advisers and ensuring that their place in policy formulation and departmental operation is fully understood. There is a question about the UK tradition of using special adviser posts as career development for future MPs; it would be simpler and cleaner if they brought recognised expertise and experience.

10 Civil service reform

In summary, there are a number of questions those leading change need to ask themselves: 1 Is there a clear and shared understanding of the purpose of the department or agency and its staff, and how they deliver value to the public and to the government? 2 What more could they do to communicate this story and to build momentum for change? 3 Is there clarity of accountability amongst political leaders, non-executives, executives and advisers? Can staff see this accountability and understand their role in delivery? 4 Do all these groups and individuals see that change is now imperative, and if a reform programme cannot be made to work with the current people, new people may be needed? 5 Are there practical steps to make change a reality and is progress being monitored at senior level – so that this becomes a real priority and will be pushed through to implementation?

These are testing times for leading civil servants and for ministers. There is a ‘new normal’ – where substantial and ongoing change is likely for the foreseeable future. There is little doubt that the civil service will look fundamentally different by the end of

the next CSR period. Permanent Secretaries and their executive boards have to embrace and lead change in a way they have not done before, but they need help from ministers to do so. Getting there will be uncomfortable, but they have to work together to succeed.

For more information, please contact: Peter Smith Director e [email protected] t 0207 856 7178

Jody Goldsworthy Associate director e [email protected] t 0207 856 7528

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