Articles

Promoting productivity

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by Kay Withers, research fellow, digital society
Whitehall and Westminster World - 08 February 2005

The Gershon review recently identified “productivity time” as one of the 6 key areas where the Government could achieve efficiency savings across the public sector, and ICT is key to achieving this, but when ICT and efficiency are mentioned together an initial assumption is that we are in most cases talking of job-cuts, of machine replacing the man, of “back office savings” and a reduction in bureaucracy and therefore bureaucrats. Certainly this has been an over-riding media message to emerge from the Gershon Review: 2.5% efficiency savings and 80,000 potential redundancies seem intrinsically linked.

It is no wonder then that the public sector view ICT suspiciously and competitively as we appear to be stuck in an “efficiency = job losses” rut of thinking. The media and their need for a human interest story such that job cuts can provide are in part to blame. But so to is the limited vision that accompanies the provision and utilisation of ICT in workplaces today.

Productivity in the UK, in terms of output per hour worked, is currently 15% lower than the US, and 13% lower than the G7 as a whole, and while there is no evidence of a correlation between ICT and productivity, there is nonetheless recognised correlation between ICT and competitiveness. However, in the public sector, Britain appears to have a rather static approach to ICT and the delivery of better, more efficient services compared to world leaders such as Canada and Finland. For example, the UK’s drive to get all public services online led to the provision of online tax returns. While this should not be dismissed as a worthless endeavour, it looks rather limited in imagination in comparison to the Finnish system which uses information already held to calculate tax returns, emails this to citizens who then have 30 days to amend this otherwise the data is assumed correct.

The external provision of services enabled by ICT in the UK still has a long way to go to match the best in the world. However the search for productivity gains would seem to demand we look at internal practices in the public sector workplace.

Where ICT projects tend to see little increase in productivity is when ICT is merely added to an organisation as an extra layer. While it may be intended as a solution to an organisational problem, lack of integration or system change mean ICT offers little more than duplication of tasks. There is much anecdotal evidence of paper records transferred, at great time and expense, to electronic records only for the former to be filed in a traditional filing cabinet, while the latter are stored on a hard drive with no added value to the paper copies. The Future of Work Programme reports from the Economic and Social Research Council (ESRC) concur that Britain has not made much advance in the use of IT in organisations.

Much of the problem here is training. Only 20% of procurement managers have a recognisable qualification in procurement and, while ICT projects include budgets for hardware and software, there are limited additional funds provided for training. In the public sector, budgets for large ICT projects are usually agreed centrally while the funding for training is provided locally, if at all. Without knowing the capabilities of a system, workers are unlikely to utilise it to its full potential. In addition, lack of training resources can lead to a fear of privatisation: since educating public sector workers is apparently not considered an economic option, public private partnerships seem more likely.

In part what is required is a cultural change in the public sector. With threats of job cuts, out sourcing and privatisation, as well as the extensive use of external monitoring and targets, it is difficult to see why public sector managers would neglect expediency in place of more innovate approaches to service delivery. Certainly the target and media culture which exists today does not encourage it.

To promote innovation, not just amongst managerial staff but also front line workers, it is important to consider the willingness of workers to change, and their motivation for doing the job as well as possible. Traditionally it was considered public sector workers maintained high standards out of a sense of duty and pride. However, this intrinsic motivation is now thought to have been dramatically eroded. Increased privatisation and outsourcing are assumed to have contributed to a decline in motivation in the original sense while targets and other monitoring systems have provided alternative goals which lack the job satisfaction contained previously.

Can ICT encourage people to use it to do their jobs better? To give it a fair chance of doing so, it is important to first tackle the fear of implementation of ICT systems. This means substantial investment in training and providing opportunities for workers to develop key skills. This will encourage employees to see ICT as an enabler, rather than a potential competitor for jobs or tool for reducing the workforce.

Next, the enabling features of ICT should be focussed upon. ICT has great potential for involving the workplace, not just through providing better communications across an organisation, but also in offering opportunities for involvement in decision making processes. A truly effective intranet should enable communication across departments in a dynamic environment, allowing for comment and consultation from workers and appropriate review from senior staff.

Of course ICT should not be relied upon as the magic bullet to solve problems of productivity and efficiency in the public sector. It is an oft repeated phrase but one that has resonance in this case, that “people not technology” hold the key to changing work place practices. ICT can assist innovative thinking, but the motivation to act innovatively will not appear with the gift of a new PC: it needs to be implemented with the appropriate training and encouragement. This is not likely to drive down costs initially and is therefore unlikely to be popular with the Treasury, but in the long term is what’s needed for the UK to develop the productive workforce required to deliver value in public services over the years to come.