3 Strengthening leadership

Leadership continues to matter

Leadership is central to delivering high-quality services to the community. It influences all the factors that characterise a high-performing organisation and is fundamental to achieving positive workforce outcomes across the sector. The quality of leadership in the public sector has been a particular focus for the NSW Government for many years, and two years on from the publication of the State of the NSW Public Sector Report 2016 entitled Leadership Matters, it is time to take stock of how the sector is progressing in this area.

As a starting point, Leadership Matters identified areas for improvement: change management; collaboration; communicating direction; listening to and involving employees in shaping organisational thinking and practice; and performance management. Since then, the quality of leadership has improved markedly in such areas as performance management (see Chapter 2) and ongoing customer-oriented service (see Chapter 4). Other areas, such as collaboration (see Chapter 6), have some way to go. This, in part, shows the complex nature of leadership – people who lead well must communicate effectively, manage change and inspire others to achieve their very best. There is work to be done but this presents the very positive message that a focus on effective and appropriate leadership is being acknowledged by staff members (see Table 3.1).

Table 3.1 Employee perceptions of the qualities of senior leaders, 2016–2018

Question 2016 (% positive) 2017 (% positive) 2018 (% positive)
I believe senior managers provide clear direction for the future of the organisation 47.0 47.8 49.5
I feel that senior managers effectively lead and manage change 43.3 44.2 45.8
I feel that senior managers model the values of my organisation 47.6 48.5 50.1
Senior managers encourage innovation by employees 48.8 48.5 50.1
Senior managers promote collaboration between my organisation and other organisations we work with 52.2 50.8 52.3
Senior managers communicate the importance of customers/clients in achieving our business objectives 60.1 60.5 61.7
I feel that senior managers keep employees informed about what's going on 43.8 45.0 47.4
I feel that senior managers listen to employees 39.0 40.8 43.4
Senior managers in my organisation support the career advancement of women 54.4 58.2 60.3

Source: People Matter Employee Survey (2016–2018)

A single, leaner, flatter and more mobile senior leadership within the Public Service was a core element of the GSE Act. The transition of all Public Service senior executives to the new four-band employment arrangement formally concluded in February 2017 and saw this cohort shrink from 2,178 to 1,939 from 2014 to 2017, and the removal of around 1,400 senior officer positions.

The number of Public Service senior executives increased to 2,051 in 2018. This was largely due to extensive infrastructure development, structural change and growth in service delivery to citizens. The size of this cohort will be closely monitored over the coming years.

The Government Sector Employment Legislation Amendment Act 2016 (NSW) (GSELA Act) aligned the employment arrangements of executives in the Health Service, Transport Service and Police Force with those in the Public Service. The Health Service transitioned to the new senior employment arrangements in January 2017, the Transport Service in July 2017 and the Police Force in October 2017. The alignment means that the NSW government sector can share the benefits of GSE Act reforms designed to create a more agile and mobile executive with enhanced career opportunities and able to deliver better frontline services to the people of NSW.

The Leadership Academy is producing high-quality leaders

The NSW Government views a successful leader as one who can:

  • take action with a view to long-term progress, by staying focused on delivering for the people of NSW
  • place public interest above personal interest and work with transparency to enable public scrutiny
  • live the public sector’s values to create a culture of respect, inclusion and wellbeing
  • find new and better ways to do things by encouraging innovation, engaging with stakeholders and taking considered risks
  • predict and respond to change
  • foster high performance by encouraging continuous learning, and through clear and impactful communication, strategic leadership, performance management and people development
  • provide professional, politically neutral advice to the Government while upholding the law, institutions of government and democratic principles
  • maximise the use of public resources
  • create positive and productive workplaces by being aware of their leadership shadow.

The Leadership Academy was introduced in 2015 to build capability in these areas. It provides structured, need-based development at key career transition points for high-performing and high-potential leaders. To date, 298 people have completed the Academy’s four programs (see Table 3.2). Analysis of the 2016 pilot cohort showed that participants were, on average, three times more likely to secure a promotion than those in a comparable group of employees.

Table 3.2 Successful Leadership Academy participants, 2016–2018

Program 2016 2017 2018 Total
Leading a Sector 2 -
2 4
Leading an Agency 11 9 11 31
Leading Executives 16 34 33 83
Leading Managers 18 66 96 180
Total 47 109 142 298

Views of leaders are improving

People Matter survey scores indicate that work to reform leadership and build executive capability is resulting in overall improvements. Although employee perceptions of senior managers are, relatively speaking, still not very positive, they have shifted in the positive direction since 2016. The Senior Leadership KPI, which is an aggregate of several questions from the People Matter survey, provides a consolidated measurement of leadership performance. The picture across the sector is that agencies are improving but that there is substantial scope for leaders to shift the way they set direction, execute strategy, shape culture, manage change and drive results (see Figure 3.1).


Source: People Matter Employee Survey (2016–2018)

Further evidence of general improvements in senior leadership comes from the 2018 People Matter survey, in the form of a narrowing of the typically observed ‘proximity effect’. The proximity effect is where employees are most positive about their own work and teams, and progressively less positive about their first line manager, senior managers and organisation. The 2018 results showed that this effect has narrowed. The difference between employees’ perceptions of their immediate surroundings and work team, and their view of senior managers has narrowed, demonstrating more consistent perceptions within organisations. This is a validation of, and a case for, more effective communication and welcoming employee feedback on future directions and work programs.

Notably, perceptions of senior managers were more positive in smaller agencies and workplaces where employees are more likely to interact with senior leaders. This may not always occur in larger organisations, especially in those with geographically dispersed workforces. However, this is not to say perceptions of senior leaders cannot be positive in these larger organisations. Senior leaders in larger organisations need to rely on middle managers to ensure their leadership is visible, and that messages cascade down through their organisations and employees feel included.5 It is much harder to fulfil organisational strategies if many employees do not think their leaders provide clear direction on the future of the organisation, manage change well or keep them informed about what is going on.

Leaders need to motivate and better support managers

Senior leaders will lead more successfully if they equip managers to deal with the challenges of leading and managing people. Anecdotal evidence collected by the PSC during consultations with the sector indicates that managers are finding it difficult to implement flexible work arrangements in their teams, efficiently and effectively facilitate recruitment and mobility, and deal with difficult people-management issues. This plays out in the People Matter survey results.

In 2018, first line managers had lower levels of engagement than executives, managers of managers, and non-managers (see Figure 3.2). They also tended to give less positive responses than the other three groups to a survey question asking if they received the support necessary to do their best at work (see Figure 3.3). This result needs to be understood and addressed as first line managers play a key role in engaging and supporting their teams, which will be difficult to do if they do not feel engaged and supported. There is an opportunity for senior leaders and HR to work more closely to ensure managers have the right capabilities and support to lead their teams.


Source: People Matter Employee Survey (2018)


Source: People Matter Employee Survey (2018)


5Jensen, Moynihan and Salomonsen (2018)