RBM+ System Origins and Introduction Vladimír Kváča

New Zealand: Getting Better at Managing for Outcomes and Getting Better at Managing for Shared Outcomes Treasure Board of Canada: The Managing for Results Self- Assessment Tool World Bank: CAP-Scan Managing for Development Results Capacity Scan Asian Development Bank: Readiness Assessment Tool - Implementing a Results Focus in Organizations EIPA: CAF Palladium: Balanced Scorecard Hall of Fame award for Executing Strategy Established in 2009 by a group of European Social Fund‘s Managing Authorities and associated partners, with support of European Commission. Aiming to find a better way how to manage public funds like ESF. Developing „Results Based Management System Plus“ based on reviews of existing frameworks, scientific research and own experience. We find the RBM System to be a part of the „New Synthesis“ stem in the current public administration thinking. The Community of Practice on Results Based Management

Our focus: programme management organisations PMO strategy = technical assistance priority OP Priority 1 OP Priority 1 OP Priority 2 OP Priority 2 OP Priority 3 OP Priority 3 PMO strategy = technical assistance priority OP Priority 1 OP Priority 1 OP Priority 2 OP Priority 2 OP Priority 3 OP Priority 3 Added value by leveraging the technical assistance! 3 But also widely applicable to any public sector organisation

Results based management Plus? With RBM System Plus we try to: 1.Address the overall need(s) for why a programme is in place; 2.Act responsibly – being trustworthy, true to the mandate, demonstrating responsibility in taking decisions; 3.Do the best possible job given the circumstances, resources and constraints, consistent with the overall mandate. See Burt Perrin, public hearing at the European Parliament of May 2011, quoted in the COP RBM Sourcebook ch. 3.3

SOCIOLOGY DEVELOPMENTAL / SOCIAL PSYCHOLOGY SYSTEMS THINKING APPROACH ECON- OMICS Biology/ ecology System and sub-systems in a hierarchy Interactions give rise to emergent properties Interactions define boundaries with wider systems Wider systems represent the environment Systems must develop productive relations with their environment Control engineering (quality) Control engineering (quality) Negative feed-back: dampening divergence of behaviour from a goal (e.g. maintaining constant blood temperature) Positive feed-back: amplifying deviation from a goal (for better or worse) The many relations between the part of a system give rise to interacting positive and negative feed-back loops leading to unpredictabilty Requisite variety Complexity theory Attractors Non-linearity Self-organisation Emergence Path dependency RBM »plus » RBM Tools 5 Rational choice theory Behavioral economics NPM approach

6 … and many, many, many more

RBM Frequent misunderstandings 1.Results ≠ set the target, hit the target Results = needs satisfaction 2.Programme strategy does not equal organisational strategy… does not equal organisation operational planning although there are links to be made 3.Measurement does not equal target setting 4.Operations can and should be organised in very different ways 5.There are no simple solutions to complex problems, and there are no final solutions… 6.There is no blueprint, no magical checklist to solve your problems. 7

About the RBM system – a warning No system can force people to perform. Systems CAN make it harder for people to get together, discuss what they think they are doing and what they should be doing Systems CAN also facilitate, rather than hinder real dialogue – which includes a fair degree of contestation People make systems work, not imagined logics or management edicts; hence enough time and resources should be invested in them. Do not trust “good practices”, there are reasons why they may not work in your context. 8

Culture matters… even in RBM Culture differs across different societies and organizations. The RBM System may be more easy to introduce in some cultural settings, while in others more careful thought needs to be applied how to approach it. Each cultural setting may have advantages and disadvantages when trying to apply certain elements of RBM.

Culture We will discuss different culture settings and try to show their possible consequences to RBM System. We use the cultural dimensions as identified by Dutch sociologist Geert Hofstede. See for more details if interested.

Few notes to avoid misunderstanding Culture within a society (at the level of individuals and/or organizations) usually differs more than „averages“ of societies. There are no good or bad cultures, however people tend to demean other cultures, as they are hard to understand when described with terms coming from the other culture.

Power distance: what is it? „ expresses the degree to which the less powerful members of a society accept and expect that power is distributed unequally. The fundamental issue here is how a society handles inequalities among people. People in societies exhibiting a large degree of power distance accept a hierarchical order in which everybody has a place and which needs no further justification. In societies with low power distance, people strive to equalise the distribution of power and demand justification for inequalities of power.“

Power distance and RBM In the „low power distance“ this behaviour is more likely: The organizational culture is supportive of a results orientation. Staff consistently ask each other: who are we doing the work for and why does it matter. Staff are trying to improve systems and processes or develop new ideas concerning what they should be doing and deliberately seek out information that can help them in these reflections. Staff give each other instant feed-back concerning their behaviour. This can be both appreciative as well as critical. Open dialogue concerning the way things are done in the organization and how this affects results is taken as self-evident. On the other hand in the „high power distance“ organizations: once the management is in favour of RBM, quick progress could be made.

Individualism vs. collectivism: what is it? „Individualism, can be defined as a preference for a loosely-knit social framework in which individuals are expected to take care of themselves and their immediate families only. Its opposite, Collectivism, represents a preference for a tightly-knit framework in society in which individuals can expect their relatives or members of a particular in-group to look after them in exchange for unquestioning loyalty. A society's position on this dimension is reflected in whether people’s self-image is defined in terms of “I” or “we.” Open exchange of opinions is more common in individualistic societies. Collectivistic societies tend to express disagreement just indirectly, in hints rather than clear statements.

Individualism vs. collectivism and RBM This dimension may affect this element of RBM favoured behaviour: Staff give each other instant feed-back concerning their behaviour. This can be both appreciative as well as critical. Open dialogue concerning the way things are done in the organization and how this affects results is taken as self-evident. In individualistic societies the dialogue may go faster, but with a higher risk of conflict.

Masculinity vs. femininity: what is it? „The masculinity side of this dimension represents a preference in society for achievement, heroism, assertiveness and material reward for success. Society at large is more competitive. Its opposite, femininity, stands for a preference for cooperation, modesty, caring for the weak and quality of life. Society at large is more consensus-oriented.“ In more masculine societies there is tendency to rather hide problems that openly discuss them, as „having problems“ is a sign of weakness.

Masculinity vs. femininity and RBM In the more feminine societies this behaviour is more likely: The making of mistakes is tolerated, as long as lessons can be derived from it. If a mistake is not seen as on opportunity to learn, it is likely it will happen again. On the other hand in the masculine organizations: the internal competition may be a good energizer for progress towards RBM.

Uncertainty avoidance „The uncertainty avoidance dimension expresses the degree to which the members of a society feel uncomfortable with uncertainty and ambiguity. The fundamental issue here is how a society deals with the fact that the future can never be known: should we try to control the future or just let it happen? Countries exhibiting strong UA maintain rigid codes of belief and behaviour and are intolerant of unorthodox behaviour and ideas. Weak UA societies maintain a more relaxed attitude in which practice counts more than principles.“ Strong UA cultures find it more difficult to accept the complex nature of the world and prefer to believe in detailed planning.

Uncertainty avoidance In the „low uncertainty avoidance“ this behaviour is more likely: Staff understand that “results orientation” is not a measurement initiative but a continuous process of change. A code of conduct emphasises all of these elements.

Culture matters… even in RBM Be aware of the cultural setup. It may indicate which elements of RBM Systems are more easy to introduce and where you should be ready for problems. Corporate culture can change quite quickly. The role of management is crucial here. Low power distance and low uncertainty avoidance cultures may provide easier starting positions for RBM.

RBM+ System Key Terms

RBM plus system Programme management organisation the organization that governs the way programme financial means are used to reach objectives as stated in a programming document PM organization may cross existing organizational boundaries with the various units distributed in various (parts of) separate organisations Managing authorities and Intermediate bodies 22

RBM plus system PMO in Lithuania MA= Managing Authority IB= intermediate body 23

RBM plus system Multi-business or one unit? A central department can be responsible mainly for “steering/regulating” and for support processes but does not itself carry out any of the primary process. This means that other units/departments act with considerable autonomy, within the framework of the steering of what is usually referred to as the “corporate centre”. These autonomous units are referred to as “business units”. PMO structure 24 NOTE: the above picture is not a picture of how things SHOULD be. It is just an illustration of how things may be.

RBM plus system Constituents they are referred to in various contexts as end-users, target groups, citizens, clients, customers etc. the word “constituent” is used to replace all these terms as “constituent” denotes a person that is entitled to expect something from a (service delivery) organization (they have a need) …and the organization is entitled to expect something in return from the person 25

RBM plus system Delivery partners: The PM organization uses a large portion of the programme funds at its disposal to stimulate delivery partners – project promotors or “beneficiaries” in EU jargon – by channeling the funding to them to deliver products and services that focus on constituent outcomes These outcomes should reflect constituent’s fundamental needs These delivery partners are assumed to NOT be under the control of the PM organization, you can only influence them 26

RBM plus system Other partners knowledge institutes, constituent representative organisations, social partners, etc. they may not receive funding to directly produce products and services that address the needs of constituents, but still may collaborate with the PM organisation in other roles (e.g. idea generation, consultation, etc.) 27

RBM plus system Legitimating authority Those external stakeholders who can revoke the mandate of the PMO: Ministers, parliament, the EC,… Their objectives therefore matter to the PMO 28

RBM plus system The primary process (core business) of the PMO: closely connected to the mission - the reason the PMO exists It consists of: the order process which takes care of the demand which in PMOs refers to: Intake: processing the proposal (registering it, checking it, appraising it, deciding on it, communicating the decision, engaging in appeals etc.). once approved, the project will be “treated” until it is finished (entailing processing progress reports, payment requests, executing controls, answering questions of delivery partners and supporting them in execution, running appeals procedures etc …). after care is what is provided once a project is closed 29

RBM plus system sales/marketing: this is necessary to generate demand (or no orders come in) which for a PMO means: communicate about the calls and generate demand with R&D, researching and conceptualising demand for calls for proposals, e.g. what should be in a call in terms of content and requirements, how should it be communicated, via what channels should it be made accessible (e.g. via a national contact point or regional contact points) The primary process is the reference point to decide what are the support and regulatory processes The above functions can be reorganised into innovation (design the value), stakeholder management (relate the value) and operations (deliver the value) 30

RBM plus system 31 INNOVATIONOPERATIONS STAKEHOLDER MANAGEMENT

RBM plus system Support processes: To be able to run a core process, people and means are necessary in terms of maintaining and permanently improving the core process They create the conditions for the core process to work: facility management (incl. maintenance of the work environment and materials) ICT management HR management communications (incl. knowledge management) financial management quality and compliance management purchasing 32

RBM plus system Regulating/controlling processes comprise all activities relating to: Planning (including longer term strategy) controlling (if plans are executed) evaluating (what is the problem) adjusting (what to do about it) of the primary process 33

Group exercise Think who is involved in governing the way programme financial means are used to reach objectives as stated in a programming document. 34

Group exercise Position the persons, units, organisations on a piece of paper Cross out those that you tend to ignore in managing the programme. Draw line around those that you think should collaborate closely with you to realise the objectives of the programme Draw the internal structure of your PMO Now think about your primary processes: How many units are directly involved in the administration of an project? Be ready to present your work to others. 35