Chapter FourStrengthening leadership

Structural reform of Public Service leadership is now complete

Leadership restructuring was a cornerstone of the GSE Act reform process, reducing the public service executive to four layers and eliminating hiring in the Senior Officer classification. Senior executive numbers reduced to 1,938 from 2,178 (as shown in ‘At a Glance’) and executive employment structures reduced to just one.

By 31 October 2017, executive arrangements in the Health Service, Transport Service and Police Force were harmonised with those in the Public Service.

The reform has also resulted in an influx of leaders new to the sector. Data from a 2017 leadership survey indicates that since 2011:

  • 31% of executives had recent experience in the private sector
  • 14% of executives had recent experience in other public sectors
  • 4% of executives had recent experience in local government.

The senior executive group meets regularly at multiple levels to share best-practice ideas, compare achievements and learn from their senior peers.

Leadership Academy nurtures future leadership potential

The Leadership Academy was introduced in 2015 to provide structured, needs-based development at key career transition points for high-performing and high-potential leaders. Data from its pilot program evaluation shows that significant capability improvements were reported by managers and colleagues in the key areas of managing people and inspiring direction and purpose. While the sample size was small, 93% of respondents said their leadership capability improved and 41% of participants had secured higher-level roles.

The Leadership Academy shows the results that can be achieved in core people management areas. It has contributed to a culture of stewardship by fostering participant commitment to making a broader public sector contribution beyond their role alone, through a focus on succession planning, the continuous improvement of their agencies and the people around them. The work of the Academy is complemented in the broader leadership cohort through a combination of mobility, secondments and development programs. Agencies are focused on building individual capability in developing and communicating a vision, and fostering a culture and strategy to achieve that vision. The next phase of work for the sector can now focus on a broader-still development of leadership talent at agency level.

Employee perceptions of all leaders indicate ongoing challenges

Employee Survey scores indicate that the work done to reform leadership and build executive capability across the sector has yet to flow through to employee perceptions. There is a gap between the confidence leaders express in their work and their organisation, and employees’ perceptions of senior leaders.

Figure 4.1: Employee perceptions of senior leaders, 2016–17


Agreement 2017 (%)

Agreement 2016 (%)

I believe senior managers provide clear direction for the future of the organisation* 48 47
I feel that senior managers effectively lead and manage change 44 43
I feel that senior managers model the values of my organisation* 49 48
Senior managers encourage innovation by employees 49 48
Senior managers promote collaboration between my organisation and other organisations we work with 51 52
Senior managers communicate the importance of customers/clients in achieving our business objectives 61 60
I feel that senior managers keep employees informed about what's going on* 45 44
I feel that senior managers listen to employees* 41 39

Source: People Matter Employee Survey
* Responses included in the Senior Leadership Index.

The stability of scores at the sector level masks some substantial changes within agency scores, with most agencies showing improvement. Large positive or negative movements generally occur in smaller agencies where changes to one or two key personnel can materially shift the results between surveys.

Figure 4.2: Average change in senior leadership scores, by agency, 2016–17

Average change in senior leadership scores, by agency, 2016–17

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Agency Difference
Health Care Complaints Commission -21.7228
State Transit Authority -13.1113
Office of the Children's Guardian -13.0908
Independent Commission Against Corruption -11.8205
Judicial Commission -10.6875
Cancer Institute NSW -10.3029
Southern NSW Local Health District -9.53025
Infrastructure NSW -9.24712
Institute of Sport -8.94407
Ombudsman's Office -6.65277
Agency for Clinical Innovation -6.51907
NSW Electoral Commission -5.85701
Police Integrity Commission -5.84364
Service NSW -5.50362
Library Council of NSW -4.91303
Public Service Commission -4.73958
Justice Health and Forensic Mental Health Network -4.36937
Trustees of the Museum of Applied Arts and Sciences -3.10283
Office of Environment and Heritage -3.09619
Office of Local Government -2.77935
Fire and Rescue NSW -2.68565
Destination NSW -1.78565
Central Coast Local Health District -1.76099
Environment Protection Authority -1.69362
South Western Sydney Local Health District -1.67945
Ambulance Service of NSW -1.44756
Hunter New England Local Health District -1.31932
Schools -1.22545
Mental Health Commission -0.66964
Far West Local Health District -0.63523
Murrumbidgee Local Health District -0.5681
Legal Aid Commission -0.50406
Department of Family and Community Services -0.37514
Sydney Children's Hospital Network -0.31756
Independent Pricing And Regulatory Tribunal -0.25826
Sydney Local Health District -0.02614
NSW Trains 0.109499
Health Education and Training Institute 0.395408
Sydney Trains 0.542376
Roads and Maritime Services 0.61515
Office of the NSW Rural Fire Service 0.643611
Bureau of Health Information 0.770308
Western Sydney Local Health District 0.782316
Health Pathology 0.968912
Mid North Coast Local Health District 1.186038
Audit Office 1.461321
Nepean Blue Mountains Local Health District 1.532547
NSW Police Force 1.550595
The Treasury 1.558411
Northern NSW Local Health District 1.755854
Treasury Corporation 1.890565
Northern Sydney Local Health District 2.010314
Health Professional Councils Authority 2.072096
Transport for NSW 2.076933
Western NSW Local Health District 2.257513
Office of the Director of Public Prosecutions 2.320678
Crown Solicitor's Office 2.480548
Health System Support Group 2.54386
Local Land Services 2.587637
Department of Premier and Cabinet 2.752072
eHealth NSW 2.810581
Department of Education 2.963341
South Eastern Sydney Local Health District 3.124582
HealthShare NSW 3.395886
Australian Museum Trust 3.538657
Sydney Cricket & Sports Ground Trust 3.568867
Department of Industry 3.570118
Parliamentary Counsel’s Office 3.598485
Parliament of NSW 3.866897
Illawarra Shoalhaven Local Health District 3.969931
Insurance & Care NSW 4.12181
Sydney Opera House Trust 4.41139
Department of Justice 4.417581
Barangaroo Delivery Authority 5.163043
Office of Sport 5.580055
Department of Finance, Services & Innovation 5.877907
NSW Crime Commission 6.636304
Department of Planning & Environment 7.652468
Ministry of Health 8.083128
Board of Studies, Teaching and Educational Standards 10.21626
SAS Trustee Corporation 10.80781
Information and Privacy Commission 10.82516
Natural Resources Commission 12.06597
Health Infrastructure NSW 12.0894
Multicultural NSW 12.20141
Office of the NSW State Emergency Service 12.34777
Water NSW 12.96852
Art Gallery of NSW Trust 13.874
Clinical Excellence Commission 14.95586
Essential Energy 21.04225

Source: People Matter Employee Survey
Note: The green line indicates the sector-level average increase.

Variance in leadership scores from the Employee Survey may indicate an issue of proximity. Across the 2016 and 2017 surveys, there was a trend of employees being most likely to agree with questions relating to their teams, then their managers, then their senior leaders. The fact that a large number of respondents chose ‘neither agree nor disagree’ for questions relating to their leaders may indicate that employees do not interact with their leaders enough to feel they can agree or disagree with the questions asked. However, the areas in which employees scores are lowest relate to two-way communication, providing clear direction and modelling the values espoused. This indicates that more employees need to hear directly from their leaders on the future direction of their organisation.

It may also reflect the relative visibility of leaders. Day-to-day demands can make it hard to talk to employees regularly. However, if most employees report that they do not think their leaders provide clear direction on the future of the organisation or keep employees informed about what is going on, it will make achieving organisational strategy much harder.

Case study: How leadership visibility and behaviour improves perceptions of culture

The 2016 Employee Survey results provoked a deeper consideration in the Department of Planning and Environment of how best to increase engagement, performance and productivity. Senior leader scores were identified as an area for improvement.

A program of work to improve organisational culture was developed across every division. Leaders were given additional detailed data insights to build understanding and trust in their Employee Survey results. They were then supported across all stages to develop their capability to:

1. build a story that described the division’s future direction and how each employee was connected to it, and develop a cultural road map of the values-based actions required

2. reflect on their actions, messages and rituals, and how an employee might feel as part of their division. This might be as simple as ensuring they always greeted employees they knew in the corridor, or a deeper consideration of which actions and behaviours they recognised, rewarded and therefore encouraged. Authentic leadership, where leaders demonstrated the values through their messages and behaviour, was a core component

3. follow a communications strategy to build their preferred divisional culture. This included a calendar of events leaders would participate in across the department

4. provide in-house coaching and support for existing and incoming leaders based on an assessment of their emotional intelligence and occupational personality preferences. This support was aligned with the leadership capabilities in the NSW Public Sector Core Capability Framework.

These were expanded into seven focus areas: senior management as the primary theme, accountability, collaboration, authentic leadership, diversity, respectful and inclusive workplaces, and recruitment.

The 2017 Employee results indicate that the program has achieved significant improvements in 10 months. Scores increased by an average of 9.0% against the sector average increase of 0.9% for the same questions.

Figure 4.3: Employee perceptions of senior managers, Department of Planning and Environment, 2016–17


Agreement 2016 (%)

Agreement 2017 (%)

Public sector 2017 (%)

I believe senior managers provide clear direction for the future of the organisation 50 59 48
I feel that senior managers effectively lead and manage change 47 55 44
I feel that senior managers model the values of my organisation 50 59 48
Senior managers encourage innovation by employees 48 58 48
Senior managers promote collaboration between my organisation and other organisations we work with 55 63 51
Senior managers communicate the importance of customers/clients in achieving our business objectives 64 75 60
I feel that senior managers keep employees informed about what's going on 45 55 45
I feel that senior managers listen to employees 45 54 41
I feel that change is managed well in my organisation 32 37 39

Source: People Matter Employee Survey

The focus areas will now shift to building authentic senior management and aligning this with a broader push towards building deeper customer capability. All other areas remain an ongoing focus, with employee data continuing to be analysed as part of an ongoing monitoring approach.


Last year’s report was entitled Leadership matters; it matters in setting direction, shaping culture, executing strategy and driving results. However, the fundamental changes made to the Public Service executive structures and the influx of people with different experiences has not yet made an impact on employee perceptions. The improvement achieved at the Department of Planning and Environment shows what a focused capability-building program can achieve in developing a shared vision, becoming more visible and role modelling the values through messages, interaction and communication. Leaders are encouraged to continue to seek out examples of best practice in improving employee perceptions in these key areas, and leverage these for their own initiatives.