Challenges in Using Performance Information to Improve Management


1
Challenges in Using Performance Information to
Improve Management

• Drummond Kahn City of Portland
• Jim Chrisinger State of Iowa
• Association of Government Accountants Performance
  Management Conference
• Schaumburg Illinois October 2006

2
The City of Roses -- Portland
3
The Hawkeye State -- Iowa
4
Challenges and Need to Use Information

• Well describe challenges to governments
  effective use of performance measurement
  information.
• No matter how good measurement information is it
  needs to be used!

5
Performance Info Only Works When Used

• Performance reports are like parachutes.
• They function only when open!
• Governments and the public appreciate performance
  reporting and its key to governance but has to
  be used.

6
Techniques and Tools Use What Works

• Wed like to discuss an overture and set of
  concerns as well as a toolkit of solutions to
  consider in your jurisdiction.
• Use what works for your organization in your
  situation.

7
Our Overture

• Conferences like this and books articles and
  basic public opinion are getting the idea that
  performance measurement is critical.
• BUT measurers are often the first cut in budget
  reduction (they are not line employees).
• BUT government and decision-makers may not use or
  internalize the results.

8
Todays Sponsor

• Performance Measurement Performance Use and
  four challenges
• Todays presentation is brought to you by the
  number 4 and the letter P

9
Portlands Audit Services Division

• NALGA Member follows Yellow Book
• Audit Services is a Division in the Office of the
  City Auditor
• 10.5 Full-time Equivalent employees
• All audit staff hold graduate degrees
  professional certification or both
• Recent AGA/Sloan Foundation Awards for Excellence
  in SEA Reporting (2005 and 2006)
• Recent Knighton Gold Medal
• www.portlandonline.com/auditor/auditservices

10
State of Iowas Dept. of Management

• The State of Iowas budget and management hub
  closely connected to the Office of the Governor
• Innovation in American Government and Council of
  State Government Innovations Awards for Charter
  Agencies
• Implementing Iowas Accountable Government Act
  and Purchasing Results Budgeting
• 26 FTEs

11
Top Four Challenges

• The biggest challenges to using performance
  measurement to improve management are
• Absence of an executive champion to support and
  encourage measurement in your organization (or
  alternately the departure of someone who had
  acted as a champion for measures).
• Insistence of government to use traditional
  budget exercises (cuts and add-backs) rather than
  basing budget changes on performance information.

12
Top Four Challenges (Continued)

• Lack of integration between the budget and the
  performance information
• (Potentially) Disconnect between the folks who
  prepare the measurement information and the folks
  who manage.
• Remember measurement information is for
  performance management holistically not just for
  the budget process.
• Viewing measurement as a once-a-year effort
  rather than an ongoing process.

13
Top Four Challenges (Continued)

• To summarize performance management will
  probably fail if
• It lacks an executive champion
• It occurs in an environment that does not use or
  appreciate it (and persists in traditional budget
  exercises) or integrate measurement with
  management
• Its led by employees not connected with or
  responsible for overall management
• Its a once-a-year exercise.

14
The Executive Champion

• It takes leadership to coach successes in any
  organization.
• Informed leaders use the tools at their disposal
  to study and make changes.
• Remember the Plan Do Review effort TQM MFR
  MBO

15
The Two Percent Solution

• Some jurisdictions base next years plans and
  budgets on what happened last year (plus or minus
  two percent).
• Enhanced management might consider other issues
  like how much of that service is needed!

16
Two Ships Passing in the Night

• If upper management does not use and act on
  measurement information its missing a chance at
  great success.
• If measurers lose or temper their advocacy for
  governance based on measures they miss a chance
  too.

17
All The Time Not Once A Year

• Brigadoon was the story about the Scottish
  village that appeared only once each century.
• Measure regularly!
• Make sure management uses the information
  regularly and not episodically.

18
But Its Not All Doom and Gloom!

• Measurement by itself can provide a critical
  public accountability and lens into government
  operations.
• Measurement helps transparency and
  accountability.
• Management may act on information later.

19
Opportunities and SolutionsAn Example
20
A Different Deal
CHARTER AGENCIES
21
TRADITIONAL DEAL

• If you . . .
• Obey the rules and
• Make no mistakes
• Then we will . . .
• Keep funding you (sort of)

22
CHARTER AGENCY DEAL

• If you . . .
• Agree to be accountable for measurable results
  for Iowans and
• Contribute to the budget fix
• Then we will . . .
• Give you more authority and autonomy and subject
  you to less bureaucracy

23
The old bureaucratic deal holds agencies
accountable for
The new reinvented deal holds agencies
accountable for
24
Department of Human Services Results

• Child Welfare stays in shelter care have been
  reduced by 20 or 10 days.
• 33 more low-income children now have access to
  health care coverage via the hawk-i program (July
  1 2003 to Dec. 31 2005).
• Preferred Drug List for Medicaid prescription
  drugs saved 1.7 million in the first quarter.
  (January-March 2005)
• Increased the number of eligible Iowans receiving
  food and nutrition benefits by 69000 (44
  increase) in the last 2 ½ years.
• Increased Title IV-E eligibility (for child
  welfare services) from 28 in June 2003 to over
  45 in March 2006.

25
Department of Natural Resources Results

• Reduced turnaround time for air quality
  construction permits from 62 to 6 days and
  eliminated a backlog of 600 in six months
• Reduced turnaround time for wastewater
  construction permits from 28 months to 4.5 months
• Reduced the time for landfill permits from 187 to
  30 days
• Reduced the time for a corrective action
  decisions on leaking underground storage tanks
  from 1124 days to 90 days(All the above
  reductions were accomplished without sacrificing
  environmental standards or quality)
• In FY04 Pollution Prevention Interns helped Iowa
  companies save more than 2.2 million through the
  adoption of environmental efficiencies. Savings
  in FY05 reached 4.1 million.

26
Iowa Veterans Home Results

• Reduced by 40 the number of residents who have
  moderate to severe pain. 9 now experience this
  pain compared to 15.5 in FY03.
• The Iowa Veterans Home compares itself to other
  long-term care facilities in Iowa using 32
  Quality Indicators. We started FY04 with 55 of
  those measures exceeding the performance of other
  facilities. The most recent performance (end of
  FY06) shows the Veterans Home exceeding others in
  66 of those measures.
• The Iowa Veterans Home has improved their
  admissions process. In FY04 69 of admissions
  were completed within 30 days. That rate has now
  increased to 90

27
Department of Corrections Results

• More probationers are successfully completing
  their probation periods we reduced the failure
  rate by 17.
• Effective services to inmates provided by
  Corrections have resulted in an increase in
  recommendations for release to the Parole Board
  by 5 over the comparable period a year ago.
• Overall inmate labor experience (in hours) on
  community service projects is up 7 through the
  first three quarters of FY06. The increase for
  women inmates was 24.
• Provided good work experiences for 50 more women
  inmates than before Charter Agencies while
  reducing operating costs by 700000 per year.
  Women inmate work experiences are also increasing
  because Corrections and Administrative Services
  are partnering in printing meaning that new
  printing work will be done at Mitchellville.

28
Department of Revenue Results

• Improved the rate of income tax returns filed
  electronically from 55 to 67
• Improved the rate of individual income tax
  refunds issued within 45 days from 75 to 94

29
Alcoholic Beverages Division Results

• Increased alcoholic beverages-related General
  Fund revenue by 9.7 million in FY04 through
  variable wholesale pricing increasing investment
  in supplier-discounted products and decreasing
  operating expenses.
• For FY05 the figure was 11.6 million.

30
Achievement of the annual 15 million target for
savings/entrepreneurial revenues

• FY04 actual 22 million
• FY05 actual 20 million
• FY06 estimated 40 million

31
Bureaucracy Busting

• Stand in the shoes authority (for HR GS IT)
• Waive administrative rules
• Authority to retain funds
• Exemption from FTE caps

• Exemption from across-the-board budget cuts
• Authority to purchase tickets directly
• Exemption from seeking Executive Council approval

32
Responsible use of Charter Agency authority and
flexibilities to improve service and make better
use of resources. Examples

• Replaced a wrecked care in a matter of days
  instead of 15 months (independent purchasing
  authority)
• Reduced turnaround times on personnel actions
  from months to days (independent personnel
  authority)
• Corrections saved 200000 by developing a new
  pharmaceutical bidding process and renegotiating
  drug costs (independent purchasing authority).
  More savings are being achieved by increasing the
  number of telemedicine visits from 313 in FY03 to
  468 in FY04

33
Continued

• DNR saved 38281 per year by bringing contracted
  work back in DHS converted five contracted
  positions to FTEs and saved 210000 per year (no
  FTE cap)
• Saved money on air tickets e.g. Des Moines-San
  Antonio for 444 instead of 656 (independent
  purchasing authority).
• Eliminated the M-40 form speeding intern hiring
  from 10 days to one day (independent personnel
  authority)

34
Continued

• DHS and Vets Home waived administrative rules to
  correct personnel systems errorsin one case
  to provide compensation already earned and in the
  other to recognize an employee who took on extra
  work and saved her department 18000
  (independent personnel authority)

35
Halo Effect
36
To learn more http//charter.iowa.gov
37
Thank You For Attending!

• Please call or e-mail if you have questions!
• Drummond Kahn
• Director of Audit Services City of Portland
• [phone]
• drummond_at_ci.portland.or.us
• Jim Chrisinger
• Department of Management State of Iowa
• [phone]
• jim.chrisinger_at_iowa.gov