Delivering Results: Implementing Performance Management in Massachusetts

1. Delivering Results: Implementing Performance Management in Massachusetts Strategy Formulation February 14, 2012

2. Why are governments turning to Performance Management? Because: In these difficult times, “we must stretch every taxpayer dollar”. - Governor Deval Patrick: FY 2012 Budget Presentation • To do that, we need solid data for: • Choosing between budget alternatives • Creating lasting efficiencies • Making government work better

3. Why are governments turning to Performance Management? Because: We need to do more . . . with less • To do that, we need to know: • What’s going wrong and what’s going right • Where exactly problems lie, and how to fix them • Who should be held accountable

4. Why are governments turning to Performance Management? Because: Citizens are demanding transparency and accountability • To achieve that, we need: • New avenues for civic engagement • Easily accessed information about how government is performing and who is responsible

5. Performance Management is a tool that can address these needs Performance Management uses objective data instead of supposition to: • Spotlight, in real time, problems that need to be fixed • Identify goals and strategies to fix those problems • Make tough budget choices, and allocate scarce resources in a more cost effective manner • Inform the legislature and public on government performance

6. A better way to lead and manage By focusing on outcomes, Performance Management identifies problems so that corrective actions can be taken Standard Approach Performance Management Performance management provides solid data on RESULTS – feedback to managers to inform their decisions and make improvements over time The standard government management approach forces managers to make theirbest guessabout what actions they should take

7. Patrick Administration vision for performance management Vision • To make Massachusetts a national leader in results-driven management, government transparency, and performance-based budgeting. Goals • Achieve improved performance, lasting efficiencies and greater transparency by: • Implementing performance management across all Secretariats down to the program level; • Linking to the budget to enable performance-based program budgeting; and • Making the information transparent and available to the public • Achieve and sustain a data-driven approach making government better

8. The initiative will extend the breadth and depth of performance management Establish Commonwealth-wide Performance Management Across All Secretariats And Agencies Down To the Program Level

9. Performance Management Approaches: “Stat” Many cities have adopted a “stat” approach such as Baltimore CitiStat: • Programs and Policies are evaluated • Areas needing improvement are identified • Specific metrics are analyzed • Management meetings focus on these areas • Bi-Monthly meetings are held with Mayor

10. Performance Management Approaches: GPRA The Federal PM approach is the Government Performance and Results Act (GPRA), updated by President Obama in 2010. GPRA requires: • Strategic Plans for Cabinet Offices and Agencies • Annual Performance Plans • Performance Reports • Quarterly reviews (at least) • Cross-Agency Federal Priority Goals • Change Management including training, Agency Performance Officers, etc.

11. Performance Management Approaches: State The Federal Government primarily develops policies and programs. Cities primarily deliver services States must do both

12. Implementation Plan Detail • Required Implementation Steps • Vision • Guiding Principles • Goals • Supporting Goals • Strategies • Measures of Success

13. Implementation Plan Detail • Required Implementation Steps • Cascade Throughout An Agency • Analyze data and feed it back to managers • Ensure managers use the information to correct problems and/or revise strategies to improve performance

14. Implementation Plan Detail • Required Implementation Steps • Connect measures to budget and other strategic processes • Make useful, accessible and understandable performance and budget information available to the public • Revisit organization’s performance management process and measures periodically to continuously improve effectiveness

15. How does it work? - Performance Management Process - • Goals, strategies and measures are developed

16. How does it work? - Performance Management Process - • Goals, strategies and measures are developed

17. How does it work? - Performance Management Process - • Goals, strategies and measures are developed • And cascaded to subsidiary levels Goals Info Strategy Measures Analysis Administrative /Executive “Actionable Information” Goals Info Strategy Measures Analysis Managerial “Actionable Information” Goals Info Strategy Measures Analysis Program

18. How does it work? - Performance Management Process - • Goals, strategies and measures are developed • And cascaded to subsidiary levels • Actionable performance information is rolled up, connected to budget and other strategic processes “Actionable Information” “Actionable Information” Goals Info Strategy Measures Analysis Administrative /Executive “Actionable Information” “Actionable Information” Goals Info Strategy Measures Analysis “Actionable Information” Managerial “Actionable Information” Goals Info Strategy Measures Analysis Program

19. How does it work? - Performance Management Process - • Goals, strategies and measures are developed • And cascaded to subsidiary levels • Actionable performance information is rolled up, connected to budget and other strategic processes • Information is made available to the public in clear, accessible and useful ways “Actionable Information” “Actionable Information” Goals Info Strategy Measures Analysis Administrative /Executive “Actionable Information” “Actionable Information” Goals Info Strategy Measures Analysis “Actionable Information” Managerial “Actionable Information” Goals Info Strategy Measures Analysis Program

20. Cultural Change Management is the key to long term implementation success • Change Management is the most demanding, complex and time consuming implementation task - and the most critical to success Culture Must Be Addressed Culture Must Be Addressed • “Simply superimposing a performance management process onto a traditionally • managed organization … is not likely to make any difference. To make real improvements, organizational culture must also be addressed.” • - National Performance Management Advisory Commission

21. Cultural Change Management is complex and time consuming , but It is the key to sustainable performance improvement over time. Elements of Cultural Change Management • Committed Leadership • Extensive Communication • Adequate Training • Engagement and Involvement • Recognition and Celebration of Success • Use Results to Manage

22. Other key success factors • Adequate Resources • Dedicated Personnel • Interoperable Technology • Transition and Succession Planning

23. Collins Center Maturity Model identifies where implementations stall These stalled initiatives can be grouped into a five stage maturity model as depicted below Performance Improvement Performance Management Maturity Model Transform Stage 5 Assimilate Most efforts stall here with little improvement Stage 4 Integrate Stage 3 Analyze and Manage Stage 2 Measure Stage 1 Stages of Performance Management Development

24. Those stalled at Stage 1 report some performance data But . . . • Data is without context and not analyzed • Data is not used to manage • Measures are not aligned with goals and strategy • Results are not linked to budget and other processes • It is not part of organizational culture • It is not sustainable over time • Little or no improvement is achieved Performance Improvement Transform Stage 5 Assimilate Stage 4 Integrate Stage 3 Analyze and Manage Stage 2 Measure Stage 1 Stages of Performance Management Development

25. Those stalled at Stage 2 analyze data and use it to manage But . . . • Measures are not aligned with goals and strategy • Results are not linked to budget and other processes • It is not part of organizational culture • It is not sustainable over time • Little or no improvement is achieved Performance Improvement Transform Stage 5 Assimilate Stage 4 Integrate Stage 3 Analyze and Manage Stage 2 Measure Stage 1 Stages of Performance Management Development

26. Those stalled at Stage 3 integrate measures with strategy, goals and budget But . . . Performance Improvement • It is not part of organizational culture • It is not sustainable over time • Only temporary, one time improvements are achieved Transform Stage 5 Assimilate Stage 4 Integrate Stage 3 Analyze and Manage Stage 2 Measure Stage 1 Stages of Performance Management Development

27. Stage 4: performance management is assimilated into culture & routines So that . . . • Performance is measured • Data is analyzed and used to manage • Measures are aligned with goals and strategy • Results are linked to budget and other processes • It is part of organizational culture • Performance improves and is sustainable Performance Improvement Transform Stage 5 Assimilate Stage 4 Integrate Stage 3 Analyze and Manage Stage 2 Measure Stage 1 Stages of Performance Management Development

28. Those that reach Stage 5 relentlessly work to continuously improve So that . . . • The agency is transformed to a continuously improving high performance driven organization Performance Improvement Transform Stage 5 Assimilate Stage 4 Integrate Stage 3 Analyze and Manage Stage 2 Measure Stage 1 Stages of Performance Management Development

29. Success is not easy, but it’s worth it Results Benefits Aligns all efforts with Governors goals Changed strategic direction Creates greater ability to monitor, manage and fix problems Improved Performance Creates greater accountability transparency, communication, and public engagement Increased Public Trust in Government Better Government Optimizes limited resources; improvements at reduced cost Cost Savings and Lasting Efficiencies