Friday, 16 January 2009

Chief Performance Officer

President-elect Barack Obama has announced that he will have a Chief Performance Officer on his team. Nancy Killefer from McKinsey & Co, a former assistant Treasury secretary, is charged with making the government more efficient, effective and transparent. Oh, and trimming the projected $1.2 trillion deficit.

The appointment is interesting. Killefer has specialised in strategies to improve organizational effectiveness for public sector organisations. Whilst she certainly has excellent financial credentials this is an acknowledgement that this is more than just a financial problem. It is one of efficiency, performance, and accountability.

It will be interesting to see what a management consultancy approach to this problem looks like. Will the real work needed to get accountability as well as accurate metrics be done? We all know that setting targets is one thing, but getting the behaviours right behind the targets is quite another. Measuring performance against the targets is equally challenging.

How Key Performance Indicators (KPIs) are calculated, how cheat-proof, and how well accepted they are, will all make a difference to how well new initiatives work. But well designed KPIs can significantly lift performance and are well worth the effort.

There are real difficulties in getting accuracy and meaningfulness into figures and financials for the United States. It is a big job. There will be lots to learn from how she tackles it and the many successes this focus will generate.

I’m sure we will be seeing a lot more Chief Performance Officers before too long. The US government is not the only organisation going through its budgets line by line but still wanting to make sure it delivers on its promise to customers.

2 comments:

  1. Interesting post. Do you think that (apart from the size) the management consultancy approach can be useful for the US government? It may be quite different from the public sector organisations where Killefer has worked.

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  2. I think the size issue is the most interesting thing about Killefer’s new job. Setting the right targets, figuring out how to define the data that gets included, and ensuring it is as close to the truth as is possible, all becomes more difficult as size increases. I was looking at an example of UK public sector reporting only yesterday where staff had deliberately cooked the books to make things look better than they actually were. Tax payers’ money was spent in the full knowledge that the only thing that would be achieved was a better star rating. The blatancy of the way the system was being cheated was breathtaking, yet no example was made of those responsible. There are lots of possible answers to this, but they require a determination amongst management that was clearly missing.

    If Killefer can bring some management consultancy tenacity to solving problems like this she will be doing her country a great service. I’m sure I wont be the only one in the business community waiting and watching.

    Thanks for your comment.

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