Performance Management Liverpool City Council


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Performance Management Liverpool City Council

  1. 1. audit 2003/2004 Performance Management Liverpool City Council INSIDE THIS REPORT PAGES 2 - 11 Summary Report • Introduction and background • Objectives and scope • Audit approach • Main conclusions • Findings • Next steps PAGE 12 Appendix 1 • Performance management survey Reference: LI014-02-2004 Date: February 2004
  2. 2. audit 2003/2004 SUMMARY REPORT Introduction and background The review assessed progress in developing the corporate performance management framework and the consistent implementation of performance management at service and individual level. Liverpool City Council's corporate assessment report made positive comments about the City Council’s performance management culture and the development of a performance management framework. The assessment stated that there was a clear corporate focus using performance indicators as a driver for improvement. However, the assessment also identified weaknesses around the quality of implementation of performance management across services and found personal review and development to be inconsistently applied across the authority. The corporate assessment also highlighted weaknesses in forward planning and recommended that the Council should develop corporate planning. The development of a corporate plan and improvements to the performance management framework were identified as key priorities in the improvement plan produced following the comprehensive performance assessment (CPA) published in December 2003. Objectives and scope The purpose of the audit was to assess progress in improving performance management arrangements and to make recommendations to support further improvement. The performance management review covered: • Corporate – assessing progress in developing the linkages between community, corporate and service plans • Service – assessing progress in implementing a consistent approach to the management of performance across service areas. The review also considered how performance management is supporting improvements that service users would recognise • Individual – assessing how well corporate and service targets are being cascaded to individual members of staff. Audit approach In completing this audit we reviewed a number of sources and used a range of approaches: • interviewed a wide range of people including a Director, Portfolio holder, Assistant Executive Directors and Service Managers and carried out focus groups of staff. This was based on a detailed probe of five service areas • carried out web based survey of 264 managers, with a response rate of 60% • liaised with other inspectorates and reviewed recent inspection and audit reports • reviewed key performance documents such as the corporate performance plan, performance management guidance, service plans, individual plans • reviewed performance information and user/citizen feedback • attended a select committee meeting and reviewed minutes of select committees for July and August. Performance Management – Audit 2003/2004 Liverpool City Council – Page 2
  3. 3. audit 2003/2004 SUMMARY REPORT We used emerging work from the audit commission’s Performance Management, Measurement and Information project (PMMI) to assist us in the review. The purpose of the PMMI project is to identify practical tools to support authorities to make performance management work for them. We also used existing audit commission publications such as ‘Performance Breakthroughs’ and Patterns for improvement. The corporate assessment: helpful and interesting practices (CHIPS) database was also used to identify good practice to assist in our work. Main conclusions Liverpool City Council has made good progress in developing its performance management framework and there have been improvements since the corporate assessment in 2002. The approach to performance management has resulted in good progress in terms of service improvement. Whilst there are still large challenges facing the council in addressing areas of low performance, there are positive indications of progress. The review found that: • a Corporate Performance Plan has been produced which sets out the Council’s contribution towards making Liverpool a ‘premier European city’. The Plan is intended to ‘focus and steer’ the actions of the Council and contains key targets and priorities for the period 2003 to 2006. The Plan represents a real improvement in the Council’s corporate planning capacity • performance management is used as an effective tool to drive improvement. An analysis of performance indicators shows that 59% have improved since 2001/2002. However, there are still a number of challenges facing the Council as 30% of indicators remain in the worst quartile • the Council has built on and improved the performance management framework since the corporate assessment. There is a consistent approach to service planning and good quality monthly monitoring of performance • there is strong leadership around performance management. Middle managers are aware of the aims of the Council and there is a commitment to performance management. There is a well developed management development scheme and personal review and development scheme (PRD) in place which provides a solid foundation to cascade corporate and service targets to individuals. There is still work to do to ensure that targets are cascaded to all individuals and that their performance is reviewed consistently. The manager’s survey, inspection reports, discussions with staff and a review of the performance management database indicate that there are some inconsistencies around the implementation of the PRD scheme. Performance Management – Audit 2003/2004 Liverpool City Council – Page 3
  4. 4. audit 2003/2004 SUMMARY REPORT Findings Corporate Managing performance Audit Commission publications and corporate assessment reviews highlight the importance of strong leadership around performance management. Work for the PMMI project highlights that there needs to be clear ownership of problems in order to secure significant improvements in performance. There is strong leadership in Liverpool. Members and managers are clear about what needs to be addressed and there is a desire to change and improve service performance. There is a positive performance culture and systems in place to support this. Managers and staff commented on the improvements that have been made in the City Council over recent years and were positive about the role of portfolio holders, the Chief Executive and Executive Directors in focusing on performance improvement. Performance management has resulted in positive results. Audit Commission analysis of a basket of performance indicators for 2002/2003 shows that 59% of performance indicators have improved since 2001/2002 and there are now 25% of indicators in the best quartile – compared to 18% in 2001/2002. The number of performance indicators in the bottom quartile has reduced significantly over the past three years. Comparisons with other metropolitan councils shows that Liverpool’s performance in terms of performance improvement is about average – the average rate of improvement for metropolitan councils in 2002/2003 was 61%. The number of performance indicators in the best quartile is the same as the average, but there are more in the worst quartile (Liverpool has 30% in the worst quartile, the average metropolitan council has 22% in this quartile). Liverpool City Council’s analysis of all best value performance indicators in the Corporate Performance Plan for the past three years highlights strong performance improvement with 71% of indicators used in this analysis showing improvement. The analysis shows that 46% of performance indicators have improved by more than 25% over the past three years. There are still a number of challenges facing the Council. As mentioned above, the Audit Commission analysis shows that there are still 30% of indicators in the bottom quartile. The overall direction of travel is positive although in 2002/2003, around a half of targets were not achieved. In the report on performance management of the LPSA we noted the positive trend of improvement in most areas, but also that less than half the first year targets had been met. Corporate planning Good progress in developing the high level direction for the Council through the new corporate performance plan (CPP). The corporate assessment team (CAT) recommended that the Council develop a corporate plan to bridge the gap between the community plan and service plans. The CAT recommended that the Council develop corporate planning processes to clarify the direction of travel and to create reference points for staff and partners to help them understand their contribution. Performance Management – Audit 2003/2004 Liverpool City Council – Page 4
  5. 5. audit 2003/2004 SUMMARY REPORT The Council prepared the CPP in June 2003 and there are clear links between the community plan and the CPP. The document is intended to be the 'high level business plan' and the 'overarching framework to guide actions’. The targets set out in the CPP are 'those targets that most directly relate to council services'. The aims link clearly with those in the community strategy. The document sets out a number of targets to be achieved in the period 2003/2006 and actions to achieve the targets are also set out. Work on developing SMART targets and milestones for all the areas set out in the plan is currently underway and baseline information is being collected. The setting of SMART targets for all areas will enable councillors and managers to monitor progress in achieving corporate priorities. The cascade of corporate targets through service plans is important and there are some good examples of this: • the Library & Information and Sports & Recreation Services produce a Powerpoint presentation on the corporate objectives to help managers interpret the objectives in relation to their own service and communicate Key Improvement Priorities to front-line staff • the regeneration portfolio produces a business plan and vision and overview that bridges the gap between the corporate objectives and service plans. Managers commented that this helped them in seeing the big picture and in developing targets and programmes in line with the overall corporate direction. There is strong recognition of the corporate objectives by managers. The survey of middle managers showed that there is strong recognition of the corporate objectives: • 95% of managers agree that there are clear corporate wide priorities and objectives that set a clear direction for the Council • 88% feel that the Council will be able to measure if it has been successful in achieving its objectives • 89% are clear about how their work contributes to the corporate objectives. A similar survey of managers was carried out in 1999/20001 and there has been a transformation in terms of awareness of objectives and performance management. In that survey, only 63% agreed that there were clear corporate objectives and only 30% felt that the Council was good at monitoring objectives. The survey was part of a wider piece of work carried out by District Audit and over 200 council’s were surveyed. It is therefore possible to compare Liverpool’s current position with other councils. In a average council, 70% of people were clear about the corporate objectives and 54% felt that the Council was good at monitoring objectives. Liverpool’s performance compares well in this analysis. This high level of recognition and clear improvement in awareness is important as middle managers are key to the delivery of the Council’s agenda to achieve continuous improvement. Our discussions with front line staff showed some good awareness of the high level aims and a positive view about the direction of the Council. However, some staff commented that it is difficult to see how the high level objectives relate to their own jobs and roles. The personal review and development framework (PRD) is one way of achieving this and the current position on PRD is commented on below. 1 Policy into Practice surveys of councils 1999 - 2002 Performance Management – Audit 2003/2004 Liverpool City Council – Page 5
  6. 6. audit 2003/2004 SUMMARY REPORT There are areas where managers are less clear. 35% of managers did not give a positive response to the statement ‘the Council targets its resources to deliver corporate priorities and objectives’ suggesting that they are not convinced that resource allocations have been shifted towards priorities. Work is currently underway to look at the alignment of budgets with priorities and we will be reporting on this in the new year. Integration of performance management with other arrangements One of the problems experienced by councils is fitting performance management into other arrangements around the community plan, the LSP, political arrangements, LPSA’s and CPA improvement reporting. We found that: • the CPP provides a good link between the community strategy and service plans • CPA improvement actions have been included in the corporate plan • arrangements to report on progress on the corporate plan are being developed and the first report has been produced • LPSA targets have been mainstreamed into the overall performance management framework. Performance is monitored through the year as part of monthly reporting processes. Shortfalls in achieving first year targets are being investigated and lead officers have been asked to attend to them • portfolio holders are clear about their role and that they receive appropriate performance information for their area of responsibility. Performance reports are considered at select committee meetings and each select committee has a work plan for the year. There are some issues to address. The recent right to buy staged inspection report also refers to weaknesses in reporting performance to members. The survey highlighted that there are low levels of awareness about the role of members in managing performance amongst managers. Only 48.3% of managers said that members have a positive role in managing performance. The approach to performance management by select committees is being further improved. The Council recently considered a paper on improving the scrutiny function, including reporting of performance and tracking of the CPP. Service Performance management culture A lot of effort has been invested in changing the culture of the Council. All the people we spoke to during the review commented that huge improvements have been made in the way that the Council is managed and perceived. There is a realistic view that more has to be done and there is confidence that this can be achieved. Performance Management – Audit 2003/2004 Liverpool City Council – Page 6
  7. 7. audit 2003/2004 SUMMARY REPORT There are a positive signs that performance management is viewed as part of the day job. Middle managers are key to delivering Liverpool’s performance agenda and the survey results show a positive response to performance management: • 85% of managers felt that they were able to contribute to setting objectives, standards and targets for their service which suggests ownership of targets • 86% of managers state that they have personal objectives which are linked to service objectives, targets or standards which suggests that performance management is becoming a reality for them • 82% know how successful the service is in achieving its objectives • 78% say that performance information is used in setting objectives, standards and targets. There were a number of positive comments about the approach to performance management: ‘There is a strong culture of performance management within the Council. It is striving to meet the internal and external KPIs’. ‘I feel more confident as a manager having a structure in which to work and goals to achieve. This enables me to be clear with staff about their roles and responsibilities and encourages individual development’. ‘I have worked for the Council for forty years and it is reassuring to have a clear view and objectives to work to………this was not always the case in the past. It’s not perfect – this is a complex organisation and it takes time’. ‘I am relatively new to the authority and have been impressed with the performance management framework. Further work is necessary to further embed the framework into council activities but this is in hand’. ‘The performance culture has reached a critical mass in the organisation against the previous ‘we always do it this way’ culture’. The Council is aware that it has areas to develop in order to fully embed a performance culture across all service areas. The chief executive highlighted the importance of managers improving performance management at the managers conference in summer 2003 and the performance report for August states that the Council’s approach to performance management is ‘still some way from a self aware/managed approach that doesn't need constant policing’. The survey also highlighted that may be a barrier to further development. As mentioned above 34.5% of managers feel that resources have not been prioritised to deliver service objectives. Less than half feel that the Council uses the most appropriate provider of services to ensure continuous service improvement. Performance Management – Audit 2003/2004 Liverpool City Council – Page 7
  8. 8. audit 2003/2004 SUMMARY REPORT Performance management system The corporate assessment team commented on the quality of implementation of performance management across services. The Council has made a number of improvements to address this and the best value and scrutiny service has enhanced the corporate performance management framework since the corporate assessment. It has: • produced corporate guidance on the production of service plans • introduced a web based performance management database which enables managers to input service plan, consultation and improvement priority data directly. It is also used to input performance information and update information on a monthly basis. The scrutiny and best value section is highly regarded and provides a good balance between support and challenge. In addition, there are good examples of resources (both in terms of people and systems) being allocated at service level to support performance management – for example, the library & information and sports & recreation services are both benefiting from the comprehensive performance data being produced by a dedicated team of officers. The business support section in the regeneration portfolio provides a valuable resource for managers in managing performance. Managers are positive about the performance management database. A number commented that the service plan format has helped to establish links between the corporate objectives and their service plans. Managers can access service plans of other services and this is helping managers to be more aware of what other services do and in promoting joint working. Our review of the performance management database, survey and interviews showed that: • service plans have been completed by all but one service (Learning Disability Care Management) • service plans have links to corporate objectives and have targets to improve performance • plans have been completed according to corporate guidelines. Quality assurance systems have been put in place but there are some differences around the quality of service plans. Those within the Education and Regeneration portfolios are generally of a good standard whilst those in Supported Living are of a more variable standard • managers and staff are generally positive about the database and feel that significant progress has been made. Interviews highlighted some areas where they felt that improvements might be made in terms of training in using and updating the system. Performance monitoring and management The ability of members and managers to use the performance management system to understand the reasons for actual and perceived differences in the quality and effectiveness of its activities is important. Good quality information allows for performance to be managed and for corrective action to be taken where appropriate. There is a comprehensive approach to reporting performance. Monthly reports are prepared for portfolio holders, select committees and executive management team. The reports give updates on progress including an estimate of the likely outturn to the end of the year. Actual performance is monitored against estimated performance and a commentary is given where appropriate. Reporting against CPP priorities is being developed. Performance Management – Audit 2003/2004 Liverpool City Council – Page 8
  9. 9. audit 2003/2004 SUMMARY REPORT There is effective support for performance improvement. The Chief Executive and Executive Directors discuss performance with assistant executive directors on a regular basis and discuss how improvements can be made and what support is necessary to achieve this. Similar discussions are held between Assistant executive directors and their managers, in both team meetings and the ‘Keeping In Touch’ one-to-one sessions. There is good practice in the regeneration portfolio where good practice is shared between managers and learning from ‘what has worked’ is used to support under performing areas. Portfolio members receive reports across their portfolio and are responsible for performance monitoring and management. The portfolio holder for supported living uses the information to discuss performance on a regular basis with assistant executive directors. Performance monitoring includes a strong focus on the service user perspective as a result of the ‘Have Your Say’ comment scheme. A comprehensive annual report is produced that analyses the main areas of feedback as well as the service improvements that have resulted from customers’ comments. It was clear during our focus groups that staff see the scheme as an important tool in gathering user views. From our discussions with senior officers, there was clear evidence of performance data and information being used as the basis for understanding why results are like they are, and then for taking corrective action. This is a positive sign of a learning organisation. Individual Corporate assessment teams look for evidence that the performance management system enables individuals to understand their roles in achievement of the council’s ambitions and priorities and allows managers to monitor their performance. The importance of helping people to perform is highlighted in ‘Performance Breakthroughs’ which states that organisations need to make sure that they develop, train and support people to do a well-defined job, with clarity on what good performance looks like through systems like appraisal and performance review. Much has been achieved in this area, particularly around management development. However, the consistent implementation of the PRD framework is an area for improvement. There is a comprehensive management development scheme in place and this is a key foundation stone of the performance improvement agenda. We spoke to a number of managers who had attended the Liverpool Way programme and they were very positive about it; feeling that the programme is equipping them to do their job better. We also spoke to people who are studying for a MBA and again they were positive. However, there is still more to do and the council is aware of this. The Chief Executive commented that there were still a number of managers who have not yet carried out any management development activity at the recent managers’ conference. The survey highlighted that 18% of managers had not yet received training to support them to achieve their objectives. The implementation of the personal review and development scheme (PRD) is also a positive development. The PRD scheme enables managers to cascade corporate, service and individual performance targets to staff. Staff commented that the scheme enables them to understand their role in the organisation and to receive appropriate training to support the achievement of their objectives. Performance Management – Audit 2003/2004 Liverpool City Council – Page 9
  10. 10. audit 2003/2004 SUMMARY REPORT There are some inconsistencies in application of the PRD scheme. The inspection of the repairs and maintenance service earlier in the year referred to inconsistencies in the implementation of PRD and the BFI improvement report 2 referred to the need to ensure that all staff have objectives which relate to the organisation as a whole. A review of the service plan data base in November 2003 indicated that there are inconsistencies around the implementation of the PRD scheme: • 41% have completed 100% of reviews and 62% have completed more than 75% of reviews • 9% of services have not completed any PRD reviews and 23% of services are shown as having completed less than half of their PRD reviews. The Council recognises that there are inconsistencies in recording reporting of PRD completion on the performance management database – for example, some services completed their reviews prior to the start of the financial year and this may account for the low number recorded as being completed. The manager’s survey also highlighted areas for improvement as 22% of managers disagreed with the statement that they receive regular feedback on their performance. Whilst 59% were positive about this, it indicates that there are areas to address if the scheme is to become fully effective. We are aware that a more in depth review of this area is to be undertaken as part of the Investors in People (IIP) review in November 2003. Next steps Our review found that good progress has been made and that there are a number of positive signs that performance management is leading to performance improvement. There are some areas for improvement and our recommendations are intended to support this. Performance management framework • Portfolios should use the results of the Audit Commission survey as a basis for discussions with middle managers about the Framework, focusing on those aspects that are proving to be less effective such as training. Individual performance review and the role of members. • The Audit Commission survey should be re-run next year to assess the Council’s progress in further embedding the performance management culture. Training and development The Council should focus its attention on those service areas where the PRD process is not yet effective, and work with them to improve its implementation by: • ensuring that PRDs are completed in a timely manner • ensuring that performance targets in PRDs are monitored on a regular basis. Corporate and service plans • Continue the work on developing clear targets, milestones and clear allocation of responsibility for delivery for the CPP. • Continue to develop the work on the reporting on performance against CPP priorities and targets. 2 BFI improvement report for CPA – September 2003 Performance Management – Audit 2003/2004 Liverpool City Council – Page 10
  11. 11. audit 2003/2004 SUMMARY REPORT Status of our reports to the Council Our reports are prepared in the context of the Statement of Responsibilities of Auditors and Audited Bodies issued by the Audit Commission. Reports are prepared by appointed auditors and addressed to non-Executive Directors/Members or officers. They are prepared for the sole use of the audited body, and no responsibility is taken by auditors to any Director/Member or officer in their individual capacity, or to any third party. Performance Management – Audit 2003/2004 Liverpool City Council – Page 11
  12. 12. audit 2003/2004 APPENDICES APPENDIX 1 Performance management survey Please see attached. Performance Management – Audit 2003/2004 Liverpool City Council – Page 12