Features: February 3rd, 2006

Efficiency is Top of the Political Agenda

By Richard Neale

Every aspect of public service is under the performance spotlight, from the speed with which the police respond to a crime to the number of dustbins emptied each day by a refuse truck. For the past five years, local authorities have been working under a Best Value regime which requires them to make continuous improvements in economy, efficiency and effectiveness. Establishing key performance indicators (KPIs) is an important first step to improving performance.

The Home Office, for example, has introduced a system of Baseline Assessments for gauging how well each police force is doing and the Assessments cover a range of core policing activities including:

  • tackling crimes such as burglary,

  • providing a reassuring presence on the streets and

  • handling calls from the public.

The grades are based on quantitative information, supplemented by qualitative judgements & knowledge of the context within which each force is working.

Collaboration is also an important aspect of performance management, from agreeing targets to sharing information and acting on it.

Business Intelligence Dashboards

In many public sector organisations, business intelligence software is playing a key role in successful performance management initiatives because it allows managers fast & easy access to up-to-date information and gives them a comprehensive view of what is happening in their area of responsibility.

The information that business intelligence provides aids decision making and helps executives monitor & manage performance. Although business intelligence solutions were originally adopted by commercial organisations, in many cases public sector organisations’ use of business intelligence is ahead of their commercial counterparts.

Increasingly, public sector managers are using business intelligence dashboards – visual displays that provide up-to-date KPI status reports – and scorecards to track performance and budgets. They enable them to define strategy as a series of metrics and set thresholds that trigger alerts when they are exceeded. For example, Britain’s second largest city is leading local government in its use of business intelligence to devolve power to district level.

When Birmingham City Council decided to move local services responsibility from a centralised model to 11 districts managed locally by District Directors, it identified the need to provide the Directors with fast & flexible performance management information.

However, existing centrally run operational systems were ill-equipped to support the new structure, because the original specification did not envisage the need encompass that particular requirement and the then available technology / software probably couldn’t have coped with it.

To address this challenge, Birmingham City Council opted to develop a business intelligence system using software from Business Objects.

The resulting system, called INFORM:

  • aggregates data from existing systems

  • delivers reports through a web portal to all the managers involved in running the local services and

  • uses Dashboards to provide users with alerts when performance target thresholds are not being met.

Providing information to both central and local managers in this way enables them to effectively monitor & manage budgets, spending and performance targets. More importantly it enables them to react quickly if performance dips.

So far, information monitored includes:

  • human resources,

  • finance,

  • waste & fleet management,

  • neighbourhood offices and

  • libraries

Birmingham City Council plans to continue to expand this to cover all core activities.

John Hunt, Head of Local Services and Housing IT at Birmingham City Council, said:

“Timely access to performance information is hugely valuable. We expect INFORM to play a key role

in driving service improvement in Birmingham”.

The same principles apply to other public sector organisations such as the Staffordshire Police Force. Using BI technology, over 1,700 employees now have access to crime incidence and detection reports that previously took up to four weeks to deliver. It highlights a problem area and then alerts senior staff, thus enabling them to ensure police officers are available in the right locations at peak crime times and to take the appropriate action for tackling specific crimes. In addition, Staffordshire can easily provide reports, covering over 20 key performance indicators, to the Home Office.

Human resource monitoring

One area where business intelligence systems have been particularly successful for public sector organisations is in human resources. With the help of tighter procedures for logging information such as sick leave and shift patterns, managers can now use business intelligence to effectively monitor this data to match skills & availability more closely to demand and introduce new procedures for managing absences.

With the use of ‘Bank’ and agency staff being very much an issue, especially as Acute Hospital Trusts and Primary Care Trusts are struggling to minimise overspend, this facility has to become a ‘must have’ requirement for their information systems.

The Way Forward

Business intelligence software is helping the public sector meet the targets set by politicians and gives a fresh meaning to the old saying: “If you can’t measure it, you can’t manage it”.

But the reality is that most organisations are not ‘greenfield’ sites as far as their data & knowledge base is concerned. Systems have evolved over the years to meet specific requirements using individual departmental budgets and, while one can work towards fully integrated systems, the reality (for an interim period at least) is that data is collected via a variety of systems throughout the organisation.

(NB. The Bathwick report found 80% of the data comes from other parts of an organisation to that of the one trying to collate it).

Data quality is a big issue, as by definition, individual systems have different standards for collection & maintenance. Some may update on a real time basis, while others may only be updated at fixed or infrequent intervals (some never update, thus possibly breaching one of the main principles of the Data Protection Act 1998 and breaking the law).

Again referring to the Bathwick report, just 3% of respondents were confident that all their data is both accurate and up-to-date.

Even when one has established the validity of the data sources, the issue is one of finding & implementing data integration software that will handle everything from old mainframes to newer systems.

Five Steps to Painless Performance Management Vision workshop

Don’t make the mistake though of thinking that Business Intelligence software is an ‘out-of-the-box’ solution, as one must never forget the old computer mantra – ‘Rubbish in, rubbish out’.

Choosing a system and sorting out the validity of your data is only the first step of many.

Step 1 – Getting together those involved

As part of the process of involving the future users of the system and gaining the support of senior management, one needs to hold workshops / meetings to define & prioritise business targets & key performance indicators (KPIs).

This could be achieved by holding a series of initial meetings or interviews to establish both the existing targets for managers and those that need to be defined to enable them to improve their areas within the organisation.

Not forgetting that the workshops should also identify targets already set by outside regulators.

Time at this stage is rarely wasted as the simple act of discussion helps to secure the support & enthusiasm of the projects participants, without which the project is doomed to failure or, at best, to only partial achievement of its full potential.

Step 2 – Verify and validate each target

Bring together the heads of each discipline to verify that each target and KPI will deliver the organisational improvements required to meet their objectives. If there is a phased delivery programme, KPI priorities may need to be reassessed for each phase of the solution.

In case you doubt the importance of this process, let’s just refer back to the Bathwick report again:

  • 77% said that there are too many Key Performance Indicators (KPIs), and

  • 58% aren’t sure which of them are important.

  • 60% say that reporting requirements change quite regularly, and

  • 70% that they have trouble keeping up with the changes.

To misquote an old saying: ‘Information systems imposed from without are doomed to end in the waste bin’.

Step 3 – Identify business owners

Assign business owners to manage the KPIs and ensure they evolve in line with business requirements.

They must work closely with IT to align information delivery with technology capabilities.

Unless individuals have a defined role in ‘owning & managing’ the collection process, analysis and use of the data being collected, things will tend to ‘drift’ over time and the system will fall into disuse & disrepute.

Remember the only certainty is that requirements will change!

Again from the Bathwick report

  • 63% say that they produce a large number of reports that are not needed any more.

  • 69.4% of respondents stated that the things on which they need to report change quite regularly

Step 4 – Technical review

Undertake a technical review to define the data required to monitor performance against KPIs. This will include establishing the whereabouts of the data that is needed to create targets for each KPI and a framework for accessing the right data within the required delivery timescales.

This will be no easy task as Bathwick found two-thirds admitted that it would take a long time to trace reported data back to source, if its quality were to be questioned.

Step 5 – Verify the solution with business leaders

It is vital to check with the business managers who set the requirements, that the implementation meets their priorities and timescales. Once this is achieved, the project team can proceed to a pilot programme.

Remember that it is extremely rare with new IT systems that:

  • Everything goes to plan

  • The software works without any error messages coming up

  • The users have highlighted every essential functionality requirement at the         specification stage

  • Data transfers between systems work perfectly without a degree of ‘tweaking’

Just as a harbour pilot helps big oil tankers to navigate safely into harbour without running aground, thus pilot programmes enable IT projects to throw up glitches without the denial of service to clients.

A proper pilot programme will pay dividends by identifying problems before they can impact on existing service delivery.

Information Accountability

Business intelligence systems should ideally be based on data warehouses that aggregate information from operational systems, effectively linking databases and providing one consistent view of information that can be made available across an organisation.

Often the introduction of business intelligence acts as a catalyst to improve the quality of data and to restructure the management processes in an organisation. This vastly improves the accuracy and availability of information, a big help in monitoring historical trends to ensure that targets are met.

You need to have an integrated system that provides one version of the truth to enable you to see how you are performing and which allows you to drill down to the detailed data so that you can find out where and when things happened. Only then will you be able to answer all the questions you might have relating to day-to-day management and to the irregular and one-off requests required to review policies and plan strategies.

 Click Here to receive a free copy of ‘Reporting Efficiencies in the Public Sector’, prepared for Business Objects by the Bathwick Group.

Further information

Please contact Richard Neale, Public Sector Marketing Manager for Business Objects

richard.neale@businessobjects.com or Tel.: 0800 195 3334

Or visit www.uk.businessobjects.com