SECTION TWO: SPECIFIC MATTERS
- Origins and Their Continuing Effect
- Funding
- Maori Issues
- Key Performance Indicators
- Student Loans
D. KEY PERFORMANCE INDICATORS
9.1 There is a discussion in Annex L on the department's performance arrangements, including details on the key performance indicators and their links to the purchase agreement. This passage is intended to provide further comment on a matter which many have raised with the Review Team.
9.2 The department's key performance indicators (KPIs) generate considerable feeling, amongst staff, purchase and monitoring agencies through to beneficiary advocacy groups. DWI uses the indicators to focus staff attention on achieving Government's outcomes and to assist in individual, centre, regional and organisational performance management. KPIs also play a part in determining performance bonuses.
9.3 This emphasis and reliance on KPIs means it is imperative that they are an accurate reflection of the organisation's total operation, they are fair, transparent and achievable and able to reflect changes in the Government's priorities.
9.4 Staff have expressed concern about the strong focus on KPIs in their day to day working lives. There is a view that KPIs do not necessarily reflect the entirety of their workload and that individualising some performance measures makes staff responsible for achieving outcomes outside of their control. At the same time, staff do not deny the need for some form of personal performance measures or for site/regional performance targets.
9.5 The monitoring organisations have expressed concern about KPIs at a number of levels. There are unresolved debates about the feasibility of measuring quality employment outcomes, which are contentious internationally. Competing demands about what to measure place the organisation in a difficult position. The department has a wide range of responsibilities. If all tasks are to be measured, this begs the question of the number of performance indicators necessary to provide assurance and the subsequent compliance cost to the department.
9.6 The purpose of performance indicators in any form is to drive desired behaviours. An issue raised by both performance monitoring organisations and other stakeholders such as beneficiary advocacy groups is whether the current KPIs are designed to do this. Concerns are expressed about whether the indicators are driving the right behaviours or possibly skewing behaviour towards "undesirable" responses. This is exacerbated by the link to performance pay.
9.7 In terms of encouraging the "right behaviours" including high levels of performance distinctions need to be drawn between the organisation as a whole, the separate business units, regions, service centres and individual staff. At the highest level KPIs should indeed be "key" as those limited number of indicators which are the most important signals of performance. They are unlikely to be the same as those at the frontline and indeed a definition of "right behaviour" at that level might show that team indicators, as well as individual ones, could be preferable. The KPIs could be redesigned to ensure the right results are being obtained, and to include indicators that are material to the organisation's performance and more meaningful to staff.
9.8 There is a need to get the right balance for the Crown in terms of assurance about achieving performance in crucial areas and managing risk, balanced against the potential for high compliance costs. KPIs are not the only means of measuring the department's performance - the purchase agreement, the chief executive's performance agreement and the State Services Commission's departmental performance assessment provide other streams of performance advice.
9.9 At present organisational KPIs are not published externally. Publishing KPIs would eliminate misconceptions held in the community about rewards given for not granting beneficiaries their full entitlements. This is unfair to staff, who are measured on benefit accuracy and turnaround, amongst others, and are not encouraged by performance indicators, or any other means, to deny people their proper assistance.
