Chapter SevenWhat results have been delivered?

The State of the NSW Public Sector Report 2016 has focused on the role of leadership in the sector. Leaders play a key role in linking future strategic workforce needs with current planning and action.

This report has found that in 2016, employees have expressed the importance of leaders in their organisation for driving major cultural shifts in customer and collaboration, and supporting employee engagement. However, employees feel that leaders need to improve their two-way communication, management of change and their ability to inspire a vision and a purpose.

Focus groups with human resource leads and directors/deputy secretaries in operational and service delivery roles have tested these employee perceptions and looked for causes, reasons and sought other evidence for the changes and improvements required.

Customer satisfaction data has been analysed, to establish whether the changes to processes and the way people work across the sector have contributed to better outcomes. While there have been significant improvements in customer satisfaction for both businesses and consumers, customer expectations have also increased.

Figure 7.1: Reform focus continuum

 Figure 7.1: Reform focus continuum

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  • This graphic shows a spectrum of agency focus, from significant agency focus, to an implemented focus, to a developing focus.
  • Where an area has been a significant focus for the sector, benefits have been achieved. These benefits are discussed in the table following.
  • Where practices are at an early stage of development, having been implemented, progress has been made with more underway. This progess is discussed in the table following.
  • Where the sector has reported its focus is still developing or yet to realise full implementation, then benefits are still to be realised. The developing focus is discussed in the table following.

This Chapter assesses the progress and achievements of the sector since government sector reform was introduced. It examines the link between the agency’s awareness of its organisational capability and its maturity in key workforce and operational practices, all of which are drivers of employee engagement. It also considers what change and other lessons can be used to shape the next wave of work to enable leaders and their workforces to achieve better outcomes.

The reforms are starting to have an effect

Where an area has been a significant focus for the sector, an agency’s workforce and operational practices are concomitantly more mature and outcomes are stronger. For other areas, however, where progress is still in the early stages or is still developing, agency practices are less mature.

It remains important, however, to recognise the milestones achieved so far, and also identify where early success could realise significant benefit and value with focused attention. Leaders will continue to play a critical role in driving the form this attention takes.

Benefits achieved

A significant focus on the areas of customer, collaboration, engagement and values can be seen in the outcomes achieved.

Customer/service delivery focus
  • 67% of agencies on or above customer satisfaction targets.
  • 81% of agencies meeting or exceeding service delivery key performance indicators.
  • Consumer customer satisfaction: 7.5 out of 10 (up from 7.3).
  • Business customer satisfaction: 7.5 out of 10 (up from 7.2).
  • Employees believe their agencies can match services with customer needs and provide high- quality services.
  • Service delivery reported as a top-five strength for agencies.
Collaboration focus
  • Many examples across the sector that show a greater openness to partnering with the private and not-for-profit sector to deliver services. Significant changes in the human services space, showing the impact of senior leadership.
  • 77% of agencies report mature practices for identifying and acting on opportunities for collaboration.
  • Sector-wide collaboration to build graduate recruitment, with every cluster participating, number of applications doubled and number of places quadrupled.
  • Collaboration reported as a top-five strength for agencies
Values and engagement
  • Employee Engagement Index increased to 65% through period of reform and change.
  • Employee engagement with work is high, with 76% of employees motivated to contribute more than what is normally required at work.
  • Government Sector Core Values framework aligned across the sector.
  • Customers rate honesty and integrity of employees as strengths.
  • Improvements in customer ratings for accountability and openness and transparency in government services, but relative results for these indicate an opportunity for improvement.
  • Ethical conduct reported as a top-five strength for agencies.

Progress made

Practices still at an early stage of development are showing signs of progress, but agencies have identified capability gaps that must be addressed before outcomes can be achieved.

Leadership capability
  • Injection of new leaders that anecdotally places at 30–40% of new executives.
  • Reduction in public service senior executive numbers by 11%.
  • Next stage of reform to align career development and other workforce management practices due to commence with Health, Transport and Police services.
  • Leadership Academy for high-potential leaders commenced.
  • Working towards a diverse and inclusive leadership, and broader workforce.
  • Employee perceptions of two-way communication, change management and ability to inspire vision and purpose indicate progress still emerging.
  • Agencies have reported leadership capability as a top five strength, but also a focus priority.
Innovation focus
  • Online satisfaction: 7.7 for consumers and business (up from 7.5/7.4 respectively) — higher than face-to-face channels.
  • Stronger community interaction and public participation in social media up 61% in 2014–15.
  • 68% of agencies self-reporting maturity in use of customer insights to evolve offering and ensure effective service delivery.
  • 74% of agencies self-reporting maturity in using customer insights to design service processes.
  • Progress in digital transformation and technology to provide seamless, efficient services, but emerging capability gap.
Performance management
  • 80% of agencies reporting managerial capability now developing to improve quality of conversations.
  • Employees:
    • 62% have a current plan
    • 71% feel they can talk openly with a manager about the quality of work required
    • 59% have received useful feedback on work
    • 44% feel their manager deals appropriately with poorly performing employees.
  • Agencies have reported that embedding performance management practices is a top-five focus priority.

Benefits to be realised

Where the sector has reported its focus is still developing or yet to realise full implementation, enough progress has not yet been made to gauge the full effect of the reform.

Capability-based recruitment and frameworks
  • Recruitment decision time is down from 94 days to 61, but still high.
  • Line manager scepticism regarding understanding and application of elements of capability assessment.
  • Capability Framework has supported recruitment since 2013. Potential remains to use it to increase data available to apply in other areas such as workforce planning, mobility and succession planning.
  • 49% of agencies are mature in using assignment to role provisions to move senior executives to different roles, and 54% use temporary assignments for development/organisational needs for senior executives.
  • Little demonstrated evidence of sector-wide mobility, but sector has identified as an area for improvement.
  • Employee perceptions:
    • 60% of employees feel their manager would support their move to another role
    • 53% of employees feel their manager would support their move to another organisation.
    • 41% of employees wish to work in another NSW public sector agency.
  • Talent pools set up but sometimes poorly accessed/understood.
Talent management
  • 34% of agencies have a mature talent management strategy, although still a build priority.
  • 57% of agencies have defined processes for identifying high-performer/high-potential executives, 44% of agencies have processes for next layer down of senior employees.
  • 42% of agencies identify adequate development opportunities within their agency as a key talent management challenge.

Where further focus could drive progress

When analysed further, the data discussed in this report shows a strong link between some agencies’ understanding of their future organisational needs and/or undertaking long-term workforce planning, and their maturity in operational practices such as innovation, cross-entity collaboration, customer service and change management.

Leadership quality is particularly influential in the analysis. Mature agencies excel in twice as many leadership-specific practices compared with those still developing. These practices emphasise the importance of having skilled people management that is both recognised and rewarded. The impact of leaders can also be seen on the maturity of workforce practices to manage high-potential and high- performing employees, applying performance management data to other workforce management areas, and action on Aboriginal employment diversity practices.

Agencies with a developed organisational capability awareness also demonstrated higher levels of maturity in a range of other workforce management practices, such as employee development and recruitment.

Agencies will need to consider further improvement in the areas that drive engagement. Sector-wide, these are innovation, cross-entity collaboration, customer service optimisation, change management and recruitment, although some clusters had other unique drivers. While customer service and collaboration rated strongly for the employees and agencies surveyed this year, the other areas are all identified as opportunities for growth.

Based on the data discussed so far, and framed around the key reform areas enacted though the GSE legislation, further focus in some areas could lead to stronger outcomes across the sector. These considerations for change are outlined on the next page.

Reform factor Considerations for change
  • A stronger succession pipeline of home-grown talent would result if the sector were to improve the skills and capability of its middle managers. This could be achieved via further maturity in talent management/review practices to identify capability in next layer down, combined with an understanding of critical roles.
  • The sector could grow middle-manager and leader capability effectively more generally, regardless of agency size, if it were to focus on developing strategies that included exposure and experience opportunities, and improved mobility practices as part of that mix.
  • Better service delivery outcomes and end-to-end customer satisfaction in seeing things from customers’ perspectives could result if the sector can mature from feeding data insights into process design to co- designing those processes with key stakeholders.
  • The sector may gain more traction and engagement with stakeholders (particularly employees) in an important transformational process if change management leadership capability were enhanced.
  • Higher employee engagement and better outcomes in service delivery could result if the sector were to examine the extent to which organisational structures support innovation.
Capability development
  • The sector could be more effectively structured to meet strategic goals if the sector understood its business- critical roles, incorporated technical know-how and selected the most appropriate capabilities from the Capability Framework.
  • A mindset shift towards the use of collaboration as a go-to operational process model that facilitates better service outcomes could result if the sector were to focus on building, rewarding and recognising collaboration capability further.
  • More effective leveraging of workforce skill to drive better organisational performance outcomes can result if the sector can better align workforce planning and capability development cycles with strategy development and corporate/business planning.
  • The sector will gain the full benefit of data-driven succession planning, mobility and workforce planning if it can extend Capability Framework implementation to more strategic workforce areas.
  • Development opportunities could be supported more efficiently if the sector were to focus on capability building through targeted experience and exposure for the broader workforce.
  • The impact of using recruitment as a workforce capability building tool can be maximised if there is a focus on embedding efficient and consistent recruitment practices.
  • Effective and efficient access to talent across the sector can be achieved if the use of recruitment/talent pools is extensively supported.
Performance management
  • An improvement in managerial capability in performance management across the sector could enhance employee understanding of the value they receive from their participation.
  • The impact of performance management as a capability building tool could be maximised if the sector used it further as an enabler of organisational performance.
  • Successful capability development, succession planning and workforce planning can result from a sector focus on using performance management results to drive action in other key workforce areas.
  • Greater visibility of leaders and mindfulness about actions will demonstrate how they live the values.
  • Greater support is required for leaders to demonstrate and build cultures of accountability across the sector.

This report has found that leaders have taken a significant step forward, with fewer, newer leaders leveraging their workforce architecture to support their initiatives and drive good public sector governance. However, while employee responses, a strong indicator of perceptions of culture, support leadership-driven initiatives, some do not indicate that leaders themselves are attracting the support required for these initiatives to succeed. The data from customers and agencies themselves typically supports these perceptions. Leaders must consider which areas they will focus on to effect change, and the important role they will play in driving it.