Terry Moran: five changes we need in public sector HR

By Terry Moran

Thursday August 21, 2014

1. Merit principal in selection and promotion

My first change would be to create a renewed respect for the merit principle in selecting and promoting people for jobs as the basis for staffing public service departments and agencies.

Through the use of the merit principle we have built a quality workforce committed to treating citizens according to the law in a fair, honest and apolitical way. I am speaking here of the merit principle as it is applied to scores, if not hundreds of occupations in the public service. These are the occupations which lack a strong professional college or association to define standards for them.

Nepotism and cronyism promotes the opposite and puts at risk whether individual citizens and businesses will be properly dealt with under the law and the regulatory environment derived from it.

It is the professional, indeed ethical, requirements set for public sector employees which define their unique advantage in most areas of service delivery over people in the private sector.

Australians expect to be fairly treated and it is the public services which were designed and built to ensure it. Thus to neglect the merit principle as the basis for a professional and ethical public service is to ensure that the public services become residualised over time with the delivery role outsourced to whoever comes through a procurement process at the cheapest price. Typically these processes overlook the very requirement around which the public services were built.

Now the merit principle in the public service goes right back to the Northcote Trevelyan report over 150 years ago, which established the modern civil service in Britain and was the basis for all state and Commonwealth public services. And that sense that selection and promotion should be based on the best person for the job has been at the heart of the UK and Australian public services ever since.

“I think there’s a danger that the problem of improper appointments may be beginning to go further …”

Of course, that has still led to some pretty unconscionable decisions — not least of which is the fact that for a long time merit really meant the best man for the job. But in principle, it is hard to imagine a better summary of merit than the best person for the job and the modern sector has tried to stay true to that idea.

But I worry that there are strains starting to show in that fidelity. Research from Adam Graycar at the Australian National University released last year showed that hiring friends or family for public service jobs was the most observed form of corruption reported by a group of 850 senior public servants. Twenty-five per cent of the group reported seeing that happening in their own department. So this is not just a sense of people grumbling about bad behaviour on someone else’s patch.

I think there’s a danger that the problem of improper appointments may be beginning to go further — and into the world of political patronage. This is very dangerous space for our sector to be in.

The legislative and executive arms of government depend very heavily on trust. New South Wales has shown pretty clearly what happens when public trust in the legislative branch of government starts to erode.

2. Improve capability within the sector

My second change would be to deepen the breadth of capabilities in the sector. There is always a tension between the need for generalists and specialists — but my sense is that currently we have gone too far towards the generalists.

As far as I can see, the long-term future for public sector governance is in service delivery and accountability processes moving closer to the local level. As that happens, what you can think of as the “head offices” of public sector departments and agencies in Canberra are going to become far less involved in service delivery decisions — and far more focused on the six core areas of ministerial responsibility:

  • Policy;
  • Strategy;
  • Budgets;
  • Appointments;
  • Performance of the system, and;
  • Engagement with the community.

But the harder news is that we are going to need more people with very specialised skills to work in these fields — as well as lots of people good at the sophisticated approaches to management in service delivery which are now available.

3. Improve diversity

My third change would be to prioritise building the diversity of background and experience of people in our sector. The sector has come a long way in getting better gender representation — but there is still a way to go in making sure that we make the most of our talent pool — particularly at the most senior levels.

I think that there is also a good argument that we could do more to reflect Australia’s ethnic diversity. About 15% of the Australian population speaks a language other than English at home and an even higher percentage of the population are from a non-English speaking background. The latest figures from the Commonwealth’s State Of The Service report found that NESB representation in the APS was at about 5.5%.

Now there are always problems about the degree to which people are prepared to self-identify in these types of surveys, but my guess is that we are still not really that representative — particularly in terms of our representation of Asian and other newly arrived communities.

“I think there’s also a lack of diversity in the work backgrounds of our sector.”

I think there’s also a lack of diversity in the work backgrounds of our sector. For example, fewer of our sector seem to have a background in the private and not-for-profit sectors. The risk in that deficit is that it means that we tend not to be good at understanding the needs of industry and community groups — and where those needs align with national needs.

The result is that we tend to default to the standard economics line that comes out of treasuries around the country, which is that a well-framed market will fix any problem. But the commercial universe is poorly reflected in government policy development. Sophisticated industry policy processes that will help to support Australian businesses in becoming more competitive suffer as a result.

And it was very heartening to see the recent proposal from the Business Council of Australia for 20 of Australia’s leading companies to offer highly structured secondments for senior public servants to work in the private sector. It’s a very good sign that one of our leading business groups is reaching out to government in this way.

More broadly, I think you could also argue that many of the capabilities that are expected in the private sector are lacking in the public sector. By this I mean things like the evidence-based approaches applied to the complex problems experienced by large organisations and top-end specialist skills in areas like:

  • Commercial strategy;
  • Business planning;
  • Project management;
  • Capability development, and;
  • Accountability systems.

4. Shake up performance management

My fourth change would be to radically shake up our performance management processes.

There really is a strong attitude amongst some public sector leaders that “performance management is not my job and it gets in the way of my real job”. I always found that attitude baffling because I could very clearly see it paying huge dividends — for the organisation led, for the political leaders I served and personally for me as a leader. I worry that some of my colleagues don’t see that link.

My sense is that some performance management processes still seem to use a performance appraisal system that is based on a personal qualities and
characteristics framework, which is pretty antiquated in 2014.

A far better approach would be to use a mixture of assessing people or teams on the results they deliver — which is tricky because there are some areas where outcomes are hard to measure, but at the very least it could be based on some outputs from the budgets, and a 360 degree feedback model measuring what peers, superiors, stakeholder and subordinates perceive to be your performance and contribution to your organisation.

Whatever mix people chose to use I think it needs to be short, well designed and structured against internal values. Systems which are task specific without focussing on generic characteristics or qualities are to be preferred.

Of course this only works if there is top-level attention paid to it — because it has to count for something or it falls into disrepute. And to be honest I think that more public sector leaders should demonstrate commitment in this area and make the results count.

5. Public servants should speak out

My final change would be to give public sector employees a bit more latitude to get engaged in discussion. I think we are far too nervous about this as a sector. If people’s views of public servants are shaped only by the scripts of the Working Dog crew and the satire in Utopia then we are really are in a mess.

Yes, we need some broad guidelines about social media engagement and protecting processes that are important for good government, but I think we have become far too cautious.

For example, if you go onto a New Zealand government website you’ll be able to see:

The public sector sky hasn’t fallen in on New Zealand for doing that — and indeed I think most governance theory says that in most cases the more transparent your policy process is, the better the results that you will get.

Now, of course, in a sector as big and complex as ours it’s hard to make fast and long-last lasting changes. But I think we do need to inject a sense of urgency into the debate about public sector reform.

To get leverage, we can use the argument that these sorts of changes are going to be needed if we want to continue to have a relatively low-cost high-delivery public sector. We can also use the current fiscal environment and argue that these changes are part of a getting greater efficiencies and effectiveness.

This is an edited speech delivered by Terry Moran to the Australian Human Resources Institute Public Sector HR conference in Melbourne on August 19.

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