Benchmarking : What is it?

Dr. Clive GracePresentation to the

Local Government and Regeneration Committee in relation to Strand 2 of its Inquiry into

Public Services Reform

Scottish Parliament 10th September 2012

Benchmarking What it is & why it matters Varieties & Scope Purposes Issues Theories of Change and Improvement Politics, Politicians, and Benchmarking An arrow not a silver bullet Be systematic but not one ‘system’

What it is and why local performance matters

Comparison of services against an external standard

Matters because: Cost and scale of services Vertical fiscal imbalance Public aversion to ‘postcode lottery’ Local representation and service delivery without (much) local

taxation

What is benchmarked? Services Corporate capacity Inputs, outputs, or outcomes How are the benchmarks set? Financial benchmarks for economy Productivity benchmarks for efficiency Innovation benchmarks for excellence Who does it? Self regulation Sector led regulation External agency

Taxonomy of Benchmarking

Variety and Scope Benchmarking is ubiquitous Service cost and technical comparison (APSE, CIPFA, WAO

Benchmarking Clubs) Statutory performance indicators Whole authority & Whole area assessments Excellence schemes Peer review and challenge ‘Communities of practice’ Improvement Plans? Outcome Agreements? BVA1 and 2?

Purposes

EconomyEfficiencyEffectivenessExcellence....

....Evasion?

....Austerity?

Issues Definitions and units for comparison (Very little comparison of public services between

England, Scotland and Wales) Data validity and consistency Time series Authoritative interpretation Action in response Context of Public Service Reform approach and

operating ‘Theory of Improvement’

Theories of change and improvementExample:Aim Drive from ‘Awful to Adequate’Funding Large real terms increasesFocus Corporate capacity and national standardsMethod Balanced scorecardMotivation External stimulus, naming and shaming,

terror and targets

Alternatives: self actuated improvement; consumer/user pressure; political accountability; etc

Example: PSR Approach and Theory of Improvement

Best Value PIs 200+ indicators for all frontline and corporate services 287 pages of guidance Set centrally after consultation Operated by the Audit Commission Superseded in 2006 by a more outcome focussed

national indicator set

CPA – single and upper tier

Comprehensive Area Assessment

Joint inspectorate assessment for each area Individual ‘use of resources’ judgements for councils,

police, health, fire and rescue authorities Local performance against the national indicator set Risk assessment linked to local area agreements

Peer reviewAim Improvement from withinFunding Getting tighter (£20,000 per review)Focus EFQM model with 12 criteria (incl. corporate

effectiveness)Method Mixed review teamsMotivation Support and ownership

Risk regulatory regimes

Control components

Information gathering

Standard setting

Behaviour modification

Context Type of risk

Public attitudes

Organised interests

Content Size

Structure

Style

Politics, Politicians, and Benchmarking

A marriage made in both heaven and hell? Critical political accountability.... ...problematic political time horizons and

public opinion drivers Great benchmarking requires tremendous

political self-discipline

An arrow not a silver bullet

Benchmarking is one arrow in the quiver, and not THE answer....

...it is best applied from the ‘improvement end of the telescope’...

....in the context of a thought through policy of Public Service Reform and Improvement...

...and (ideally) a fair degree of political consensus... ...and the support of key stakeholders

Be systematic but do not impose one ‘system’

Working out and carefully designing the benchmarking approach does not guarantee success...

...but not doing so guarantees failure Not ‘one benchmarking system fits all’.... ....different services in different situations call for

different benchmarking solutions

10TH SEPTEMBER 2012

clivegrace@hotmail.com