This research has helped re-shape major efficiency programmes in complex, high-risk environments where success of delivery is key.
Major programmes are large-scale, transformative projects of public relevance. Effectively managed, they have the potential to significantly improve both governmental efficiency and wider quality of life. Managing major programmes, and monitoring their performance, involves the use of both strategic and financial metrics for decision-making under uncertainty.
The challenge lies in the complexity of the programmes’ governance, including the number of interconnected systems and teams involved, and the fact that many need to be planned and administered over a period of years, often decades. Inflexible use of performance measurement metrics can hinder, not help, effective governance.
Governance, and how it interfaces with reporting and measurement, is a long-standing research interest of Professor Paolo Quattrone, Chair in Accounting, Governance & Social Innovation at the University of Edinburgh Business School. Together with Professor Cristiano Busco (University of Roehampton, London and LUISS, Rome), he has been exploring how performance management systems can be used more dynamically by looking at systems such as the Balanced Scorecard (BSC).
The researchers see the BSC, not in fixed and linear terms, but as a rhetorical ‘wheel’ utilised for stakeholders’ management and engagement. For them, dynamic performance measurement systems are composed of four key features:
- a visual performance space;
- a method of ordering and innovation;
- a means of interrogation and mediation;
- a motivating ritual.
This approach leaves space for the inevitable uncertainties and element of change in large projects and the reliance on collective intelligence that minimises the risk of such change. Its development draws on historical work by Quattrone on the Society of Jesus (formed in 1540), specifically on how the religious Order devised administrative procedures that guaranteed dynamism and an ability to deal with unknowns and uncertainties on their missions.
The UK Government is currently involved in a number of major programmes, of which several have engaged with this research through the UK Cabinet’s Major Programme Leadership Academy (MPLA). We focus on two of these programmes: the Prison Unit Costs Programme; and the UK’s Submarine Acquisition programme.
Both the Prison Unit Costs Programme and the UK’s Submarine Acquisition programme involve highly complex activities, the success of which relies upon people with very specific expertise and remits working together effectively.
In each case, senior staff who attended the MPLA have changed the way they design governance structures and use performance metrics, from trying to shoehorn organisational complexities into a single, simplified ‘bottom line’, to being open about the challenges different teams face and seeking more inventive, shared solutions to cross-cutting problems.
Change has been affected at the highest level, with Board meetings re-structured away from approval processes towards an honest appraisal of what each project is trying to achieve and how its performance can be measured and communicated.
Communicating with team members at all levels, and selectively relying on their expertise for making decisions, has allowed each major programme to improve the management of its large and diverse group of stakeholders.
The changes have had particular implications for procuring best-value from external contractors; They have helped shape the conditions and an environment to assist the delivery of potentially as much as one billion pounds of savings from the public purse from the Submarine Acquisition programme alone over the course of the next ten years.