Hall

Accountability, or the lack thereof, is often used as one of the reasons for underperformance in the public sector. Air Jamaica's constant missing of budget and disposal targets, thousands of illiterates coming out of schools, and tax revenues well under budget are typical examples where no one is held accountable despite everyone agreeing that there was significant underperformance.

Of course, there is also significant underperformance in the private sector, but the requirement and nature of accountability in the private sector is expected to identify swiftly and force measures to correct the underperformance.

As we strive to require accountability in the public sector, it is important to understand the underpinnings of accountability in the private sector and to ask what, if anything, can be transferred to the public sector. No matter the mission or vision statement, the critical performance criterion for a private company is profitability. Private companies know that a continued failure to make a profit will mean closure or sale.The managers of the company, and indeed all employees, understand this requirement and know that when their company fails to generate profit, they will lose their jobs. Managers and employees understand and accept the need for accountability and, therefore, appreciate the need for measurable targets relevant to the area of operation for which they are held accountable.

other important goals

All understand that the company has other important goals, such as worker welfare, sound environmental practices or community development. The critical outcome, however, is profit. The making of profit is the reason for all the inputs, and it is the making of profit that allows the fulfilment of some of the other goals.

The point is that there is an overarching goal that impacts all the other goals, and consequently, all goals are set and varied in relation to the key goal of profitability. The monthly management reports very quickly show up underperformance and the officer or department to be held accountable is identified. Accountability, therefore, occurs primarily at the relatively autonomous business-unit level - parent company, subsidiary, division or department - and extends through managers to the CEO and the board.

Government companies producing goods and services should be subjected to the same yardstick as their private counterparts. In many instances where the monthly information report shows up poor performance, the response is to inject more funds. Lack of profit should not mean more investment unless it can be genuinely justified, and consistent failure to generate profit should never be accepted.

As we think about introducing and enforcing accountability in the public sector, we are immediately confronted with the lack of a clear, easily measurable overarching goal. With no measurable, accepted overarching goal and differing sub-goals, it is not always clear in the public sector who is accountable and for what. Sometimes I suspect, as reported in The Gleaner of October 29, that an input to achieve a goal, sending out 10,000 assessment letters to people not on the tax roll, is confused with good performance, which is the actual collecting of the $7 billion in unpaid taxes. Responsible officers must never be allowed to see success in terms of achieving an input.

Dismissal or removal of the underperformer is the ultimate penalty for underperformance. In the private sector, the authority for dismissal is clear and swift, but with an appeal process. Most severance decisions are made within the framework of the business unit. In the public sector, the decision centres for severance or even significant disciplinary action are often quite removed from the actual workplace.

At the workplace in the public sector, authority and responsibility are often blurred and the disciplinary process of the underperformer is beset by a complex appeal framework. Consider, for example, the removal of a teacher for underperformance. The process begins at the department head level and winds its way through principal, school board and Ministry of Education, with stops along the way for participation by the Jamaica Teachers' Association, the parent-teacher association and the general community. In principle, one can argue that this is a justifiable process as job security should never be taken lightly.

What makes the process almost impossible to navigate is the lack of clear, measurable performance targets that all accept, and the non-existence of an overarching goal against which underperformance can always be judged.

In the private sector, the top of the stream is particularly vulnerable for consistent underperformance of the overarching goal of profitability. With no overarching goal, and no specific downstream goals for the school, the top of the stream blames the system, and the downstream manager or teacher blames underperformance on the quality of students at intake and societal problems, such as crime, gangs and poverty. That is why after years of schooling, we can produce large numbers of illiterates and no one is held responsible.

underperforming schools

It is, however, particular schools and not the school system that produces illiterates, and it is the relevant staff in the underperforming schools that must be held accountable. It is obvious that we cannot have one-size-fits-all measures of performance. The performance criteria should be first of all school-based and agreed to by board and teachers, with some oversight from the ministry. The board, teachers, parents and students must know and accept the measurable goals. Some goals can even be specific to grade or class.

The teacher/staff evaluation process would be objective and the action triggered by underperformance should be understood by all. There would be no wholesale condemnation of the teaching profession as the focus would be on the underperformer whose underperformance derives from standards set in a process in which he or she participated.

A system that penalises underperformance must at the very least also reward consistent outstanding performance. Here again, assessment is not simple. In the case of underperformance, we would not expect dismissal to be the outcome from the first identification of underperformance, and equally so, we would not expect substantial reward for a single score of outstanding performance.

I have used the teacher model as an example of how accountability could be made to work in the public sector because it is topical and because, in a strange way, it is one of the easiest to conceptualise. I do, however, believe that the model has universal validity. The performance goals should be agreed by the employees and governance entity at the level of the relatively autonomous governing unit - school, hospital, police station, department. Where possible, the administrative or regulatory personnel who work in the civil service should have goals that are tied to those of the autonomous governing unit. The critical appraisal goals must be clear and measurable.

This does not mean that qualitative goals are unimportant and should not form part of a broader appraisal process. It does mean that where possible, the measurable goals should seek to embody the qualitative goals, but, above all, the qualitative goal should not be used as an excuse to explain away poor performance of the measurable goal.

It is distinctly possible that some activities of central government may not lend themselves to measurable goals and, if so, the most objective qualitative goals will have to be used. I do, however, believe that in most cases, relevant measurable goals that capture the essence of the activity can be identified, for example, operating within budget, number of cases handled, quantum of tax collected, etc.

Three other guidelines that emerge from the private-sector comparison is first the recognition that underperformance need not be the fault of an employee. The business or activity may, for a host of reasons, be unsustainable. For the private sector, no matter the reason, a consistent failure to generate a profit means reorganisation and/or closure of some kind.

prone to failure

Similarly continual failure, in the public sector to meet measurable targets calls for reorganisation or closure. New ventures, as the experience of the business world can testify, are prone to failure. New ventures in government should be subjected to careful and timely assessment to ensure that they are achieving their goals. Early closure or reorganisation is always better than sustained periods of under performance.

Second, clear, measurable goals allow for objective frequent assessments comparable to monthly reviews of performance against budget. The presenter of the report to a board or other body should be the officer with responsibility for the performance.

Third, the decision makers that rule on underperformance must not be far distant from the autonomous unit. Principals, commissioners of police, divisional heads, and hospital managers must be held accountable by the relevant board. The principals, commissioners and managers in turn, must be able to make their key managers and operators accountable, with the disciplinary outcome largely within their control.

The plea to develop measurable standards of performance is not rocket science. It is not intended to be a substitute for important qualitative and moral standards. These must be maintained with the measurable outcome defined to embrace the readings of our moral compass.

Dr Marshall Hall is a businessman and former CEO of the Jamaica Producers Group. Feedback may be sent to columns@gleanerjm.com.

Dwight Nelson (right), former minister without portfolio in the Ministry of Finance and the Public Service, watches closely as members of the Jamaica Teachers' Association do their calculations during a crucial salary-related meeting in October 2008. From left are: Dr Dorothy Raymond, senior secretary, JTA; Ena Barclay, immediate past president; Doran Dixon, president; and Michael Stewart, president-elect. Principals and teachers must be held accountable by their boards for their performance. - FILE