For public sector organisations looking to improve efficiency, start with the data

By Peter Horne

We are living an Information Age in which data is abundant. As many leading organisations have discovered, data allows executives to use hard evidence to make smarter choices, complementing experience and expertise.

Despite our data-driven environment, the public sector has not kept pace with developments. The suboptimal use of public data across the sector has received most attention, but Whitehall departments also lack sufficient data on their own organisations to guide effective decision-making.

A recent survey of attendees at Civil Service Live reinforced this idea, with illuminating results. Half said they did not know how effective their organisation was, over 40 per cent had experienced problems knowing who in their organisation was doing what, and over a third said they needed to reduce spending.[1]

These responses suggest that government agencies are struggling to understand how parts of their organisation are performing.

The need for action is made urgent by the demands of stakeholders: ministers want bodies for which they are accountable to be transparent, organisational leaders want a richer understanding of their resourcing arrangements, and civil servants want to improve efficiency.

The imperative to identify and correct inefficiency is great.

Benchmarking provides a strong basis for performance and savings

To overcome this problem, it is not enough merely to look at the performance of our own organisation. Instead, we need to find robust comparisons with other, similar organisations.

That is why there is a valuable role for benchmarking across the sector, which can be used to improve performance and increase savings. The impact of benchmarking is premised on three ideas:

• Ignorance is not bliss. All organisations know they have areas to improve, but few know what they are. Understanding where to improve is the first step.
• Outward comparison enables inward improvement. Benchmarking helps organisations track their performance compared to their peers. They can understand where their strengths and weaknesses lie, highlighting specific development areas.
• Knowledge breeds efficiency. Knowledge allows institutions to address their gaps with focus. A targeted approach minimises effort and resources while maximising improvement.

Benchmarking is not new. Indeed, over 25 years ago, Dr Sylvie Trosa and Suzanne Williams outlined[2] that there are three ways that organisations can use benchmarked results to drive improvement:

• Standards benchmarking. This involves setting an expected quantity, quality or efficiency of outputs, based on sector best practice. High performance standards motivate staff and encourage leaders to conduct regular KPI checks.
• Results benchmarking. While government lacks the competition of the private sector, results benchmarking can simulate a similar environment. Visibility of similar providers’ performance incentivises organisations to make the improvements required to be competitive with their peers.
• Process benchmarking. Governing bodies can use process benchmarking to understand where variations in performance lie, with the aim of understanding best practice and incorporating it across the sector.

Used consistently across a sector, benchmarking not only helps individual organisations improve, but also supports sector-wide development. However, the public sector has failed to exploit the benefit of benchmarking.

CiviForum offers granular and consistent comparisons

To help government organisations improve performance, we have developed CiviForum – a sector-wide benchmarking tool for government departments and agencies.

CiviForum offers an integrated and user-friendly system that allows rapid data collection and delivery of insightful, actionable data based on comparisons with similar organisations.

This data helps government departments and agencies understand the relative efficiency of different functions and where they can save costs.

CiviForum uses highly granular data, allowing organisations to build a detailed picture of the cost and efficiency of each function and service area. Our consistent activity framework and normalising of data allows us to compare organisations on a like-for-like basis.

Many insights can be derived from CiviForum benchmarks, including:

• The true achievable savings to be gained by rethinking the service model for professional services. One organisation, for example, reduced its operating cost by 39 per cent by redesigning the service model for transactional administrative activities.
• Where interventions are needed to improve service effectiveness. The benchmarking data shows no correlation between cost and quality, so the key to improving services is not simply to spend more on them, it is to focus on the service attributes that matter most for users. For instance, one organisation halved its spend on its IT helpdesk but increased staff satisfaction ratings through focusing on the two most important attributes: responsiveness and competence of support staff.
• Whether the right resourcing model is in place for key services, such as the right balance between generalist and specialist staff. Our evidence suggests that high levels of generalist staff indicate inefficient role and organisational design.

The data behind each function allow the user to highlight where their organisation is over- or underperforming. By uncovering specific and achievable efficiency opportunities, true investment profiles and service delivery model choices, CiviForum empowers users to improve their performance and increase savings.

CiviForum can free up as much as 25 per cent of administrative budget

For more than a decade we have worked with universities to use benchmarking to improve performance. Working with us over time, organisations have seen savings of 15-25 per cent across administrative operations. CiviForum offers public sector leaders the clarity and insight they need to make critical decisions within months. This might mean building shared service capability, delivering new operating models, or automating frontline services. CiviForum helps organisations to focus on what matters most.

As budgets tighten and user expectations grow, government organisations will need to intensify their efforts to improve efficiency. Without data as a guide, government leaders run a high risk that their efforts will be misplaced, and the outcomes disappoint. It is a risk that few can afford to take.

Find out more about CiviForum on the Nous website.

Get in touch to discuss how we can help you use the CiviForum database to optimise the operations of your public sector organisation.

Connect with Peter Horne on LinkedIn.

Prepared with input from Abigail Dempster.

Published on 11 August 2022.

[1] n=69

[2] Trosa, S., and Williams, S. (1996). “Benchmarking in Public Sector Performance Management”. OECD. PUMA Public Management, Occasional Papers. No. 9