Building capability and culture
The ability for individuals to exercise power effectively will be influenced by, among other things, their capability and the culture in which they are operating. Leadership is a key determinant of an entity’s culture. Overall, creating an organisational culture that values performance and seeks to demonstrate the principle of sustainable value for money in each day-to-day decision is a key goal of public sector leaders.[1]
While the financial framework is not, of itself, a determinant of culture, incentives within the framework can influence the behaviour of users. People operating under the financial framework should be properly empowered to make decisions and be held to account for their performance.
Much can be done to improve financial management capability – including through formal training, assessment and evaluation of staff – to ensure that all elements of government are geared to achieve efficiencies and better value for money, while operating within the policies and priorities of the Government. The focus should be on improving the financial literacy of all people who manage public money and resources, no matter their seniority. Financial literacy includes being sufficiently proficient to know when expert help is needed.
What do you think influences the culture of an entity?
[1] The Chartered Institute of Public Finance and Accountancy (CIPFA), Leading in Hard Times: Guidance for the Public Sector, London, 2011, p. 5.
“People operating under the financial framework should be properly empowered to make decisions and be held to account for their performance. ” I wholly agree with the sentiment of this statement however the habitual Canberra centric blame game ignores performance based on output, focussing solely on errors in process.
These errors being largely caused by unnecessarily complex and counterproductive process.
Processes must be focussed on Output not on avoiding personal responsibility. Governance should focus on Transparency and personal responsibility. Complexity reduces transparency and undermines both performance and good governance.
My experience is that ‘Governance Processes’ which are built up to prevent error then become an instrument for individuals to actively avoid taking responsibility for delivering their required output. Complex arrangements are not a solution to a problem they are simply a form of bureacratic sclerosis.