Human Resource Management Modernisation in OECD Countries

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Human Resource Management Modernisation in OECD
Countries Achievements and Challenges
Public Governance and Territorial Development
Directorate, OECD
Oscar Huerta Melchor OECD, Administrator
Tunis, Tunisia, 14- 15 February, 2008
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Main focus
1. HRM in the context of Public Sector
Modernisation.
2. Delegation of Responsibility in HRM.
3. The Individualisation of HRM.
4. Managing Senior Civil Servants.
5. Future challenges in HRM.
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1. HRM in the context of Public Sector
Modernisation

• Government has a larger role than 20 years ago
  but of a different nature.

• Continuous pressure on public expenditure.

• Hard and sometimes unpopular political choices
  are needed.

Lessons learnt after two decades of reform

• Policy formulation and managing change are
  interdependent.

• A managing change strategy is central to any
  reform in the public service.

• Modernisation depends on the context of each
  nation.

• Reform is continuous and producing change
  requires time and political commitment.

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2. Delegation of Responsibility in HRM

• Peoples values have changed.

• Delegation of authority to managers is an
  alternative to handle societal changes.

• Delegation of HRM means to empower and enable
  public managers to adapt their HRM systems to the
  business needs of the organisation.

• Some functions have been delegated in OECD
  countries

• Delegation of manpower planning.

• Delegation of recruitment functions.

• Delegation of staff training and development.

• The liberty to motivate employees.

• Delegation of working arrangements.

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Delegation in HRM varies across OECD countries.
No single model or standard.
For example recruitment

• Belgium

All recruitment for permanent employment is
handled by a federal selection organisation.
A central recruitment body can authorize
departments and agencies to handle their own
recruitments under certain guidelines.

• Ireland

Recruitments are the responsibility of individual
departments and agencies but observing the
recruitment procedures set out by an independent
body.

• United Kingdom

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• Delegation of HRM has impacted central HRM
  bodies, but they still play a significant role in
  policy formulation.

• In most OECD countries central HRM bodies still

• Retain legal responsibility in reforming HRM
  policies.
• Introduce new HRM policies and processing
  HRM-related laws.
• Determine the pay level of civil servants.
• Conduct negotiation with trade unions.
• Play a key role in managing and developing the
  senior civil service system.

Two remarks

• Delegation of HRM authority is never total.

• Delegating authority may need to be accompanied
  by a strengthening of certain central functions
  to maintain policy coherence.

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3. The Individualisation of HRM
Refers to

• The management of employees as individuals and
  not only as part of a collective entity.

• A different treatment of staff according to the
  changing needs of organisations and depending on
  their performance.

Two points of reference

• Organisational and individual performance
  management.

• Performance-related pay schemes.

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A. Organisational and individual performance
management

• Performance-oriented management has produced a
  cultural revolution in the public service.

• The introduction of a performance-oriented
  culture must be preceded by a caveat on

Transparency
Clear promotions mechanisms
Trust in management

• Performance in the public sector involves what it
  is done and how it is done.

• Strong link among

Managerial development
Performance management
Delegation of HRM
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Lessons on performance management

• Performance management should be based on
  strategic goals and the business plans of the
  organisation

• A systematic assessment of employees performance
  is crucial.

• Dialogue should prevail.

• Good performance should be rewarded and poor
  performance addressed.

• Team performance is generally more relevant to
  meet the public sectors goals than the
  individual itself.

• Public sector managers should be trained in
  performance management and assessments.

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• Performance-related pay schemes

No single model of PRP across OECD member
countries.
Common trends in the OECD countries

• PRP policies cover the management level and
  increasingly many other different categories of
  staff.

• Increase in the use of collective or group
  performance schemes, at the team/unit or
  organisational level.

• Long-running standardised PRP schemes have
  evolved into more decentralised systems
  facilitating delegation of managerial functions.

Only Denmark, Finland, Korea, New Zealand,
Switzerland, and the United Kingdom have
formalised PRP policy schemes.
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4. Managing Senior Civil Servants
Senior civil service aims at giving a clear sense
of direction to policy formulation and improve
performance and effective delivery of services.
Four main trends of reform

• Strong emphasis on developing leaders.

• Management of top officials as a distinct group.

• Position-based countries put emphasis on early
  identification of leaders and the creation of
  pools for future leaders.

• Career-oriented countries use reforms as a
  priority for cultural change towards more
  flexibility and individual accountability for
  performance.

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Senior managers are responsible for

• the proper and appropriate implementation of
  legal instruments and political strategies

• the coherence, efficiency and appropriateness of
  government activities.

The main challenge is the balance
Senior Managers
As politically neutral stewards of the government
As the responsive servants of the elected
government
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5. Future Challenges in HRM in OECD Countries

• Modern government demands more knowledge and
  skills but faces difficulties in attracting and
  keeping high-quality staff.

• Key public problems are interconnected but there
  is a growing fragmentation and individualisation
  of public service responsibilities, incentives
  and capacities.

• How to attract and motivate senior executives who
  meet the high performance demands of a modern
  ministry, while keeping them in a wider
  cross-government culture bound by the public
  interest.

• The management of cultural change in the public
  sector.

• The development and maintenance of a sufficient
  managerial capacity and competence.

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Lets not forget that
Reforms are context dependent.
There are no recipes to reform.
One of the most difficult challenges is to create
a results-based culture within organisations and
government. To achieve change is necessary

• Obtain and maintain the support of managers and
  employees.

• Obtain and maintain the support of politicians.

• Realistic expectations are needed.
• What can be achieved by this reform?
• How long will it take?

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Oscar Huerta Melchor Public Governance and
Territorial Development Directorate Budgeting and
Public Expenditures Division oscar.huertamelchor_at_o
ecd.org