Tuesday, April 29, 2008

Pay panel report: Change in work practices required

The introduction of performance related incentive scheme (PRIS) in the Sixth Central Pay Commission(CPC) Report is to be welcomed. However, its implementation presents challenges that need careful consideration. Moving from an annual bonus system, which is more gratia than a reward for performance, to a strictly monitored system of measuring performance has less to do with policy changes and more with changes in the mindset of employees across hierarchies.

The pay commission report has covered almost all aspects of introducing such a scheme from using SMART goals, developing an objective score card based performance management system, leveraging ICT and MIS and a focus on building the corpus through internal savings resulting from process improvement. However, the aspect that will need most attention is the on-the-ground implementation of a system that is not only easily understood and acceptable but supported by other related initiatives that guarantee its success and sustainability.

A change in work practices will be required. Building a system which discourages inefficient use of time and rewards high productivity, would need to be supported by adequate communication of what constitutes performance. Overtime, for example, is more a norm than an exception — a component of compensation that proves highly lucrative for most employees. On the one hand internal communication, messages, workshops that demonstrate the benefits of productivity need to be introduced. On the other, strong and smart planning processes needs to be put in place to drive a culture that appreciates work life balance, encourages achievement of more in less time and looks down on inefficient practices such as regular use of overtime.

'Measurable indicators' relevant to job holders would need to be defined. While performance for the government employees goes beyond profit to include social goals, the challenge is to determine the extent to which the achievement of these goals is controlled by the employee being measured and rewarded. For example, how can a reduction of crime rate or reduction in infant mortality rate be attributed to the performance of an individual?

A further exercise of cascading these end outcomes to actual measurable goals within the purview of the individual employed is necessary to make the measurable indicators relevant. The stated performance objectives at the macro level need to be broken down and contextualised to the actual job at hand for an individual employee, to ensure performance can be predicted and controlled.

While this can be easily achieved for roles primarily into execution, there are roles at the higher echelons that focus on work like policy making. What parameters would be used to define the outcomes of these roles and how would they be measured? Another dimension would be those working in functions like quality, finance, personnel and administration, where outcomes may not be easily seen. The key challenge anticipated in these jobs is in identifying 'measurable indicators'.

And then there is the voice of the citizen. Measurement of performance of government officials who serve citizens cannot be limited to internal parameters only. Mechanisms to capture public feedback need to be introduced and relevant inputs need to be considered in measuring performance. The CPC report does propound the multiple assessor concept and makes a reference to the Sevottam model. However, since most of this feedback would be based on perception, the challenge would be to define the parameters to make them measurable.

The existing performance measurement system (or the lack of it) revolves around confidential reports (CRs) that are used mostly for career growth programmes – and not for measuring performance. If these CRs are to be replaced by balanced score card-based PMS having SMART goals, adequate sensitisation and training of all involved in the process is necessary. More often than not a well-developed system does not meet its objectives because the end users are unable to leverage its benefits. The goal setting activity, for example, cannot be top down. It needs to be mutually decided in an open discussion, include realistic and achievable goals, accepted by all involved with mid course corrections to ensure that individuals are not demotivated with excessively stretched goals or given too soft targets.  

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