Academic journal article Organization Development Journal

New Trends in Public Sector Performance Measurement and Evaluation: A Closer Look at the Italian Reform

Academic journal article Organization Development Journal

New Trends in Public Sector Performance Measurement and Evaluation: A Closer Look at the Italian Reform

Article excerpt

Abstract

In recent decades, great emphasis has been placed on development of new instruments for measuring and evaluating the "labour factor." The present study examines the latest European models for measuring and evaluating public employees' performance, with the aim of assessing-through case analysis-the state of the art of the new Italian model. The results highlight the complexity of performance appraisal and the difficulty of putting into practice the theoretical principles of public service motivation.

Keywords: performance related pay (PRP), performance measurement; performance evaluation.

Changes in Human Resource Management

In recent decades, public authorities have seen enormous changes in terms of supply and demand (Raadschelders, 2003). The need to respond to this ever more multifaceted demand has led to a move towards more flexible organisation and management models (Perry, 1997; Wirtenberg, Backer, Chang, Lannan, Applegate, Conway, Abrams, & Slepian, 2007).

Public authorities have embraced new concepts from Human Resource Management (HRM), and the introduction of results orientation has made it necessary to define resources that could bring about significant performance improvement (Bresser-Pereira, 1997). Among these, the "labour factor" has been indicated as a key resource, as a strategic element of the activity of administrations (Yager, 2006). Great emphasis has therefore been placed on development of the personnel function, its new perspectives, and new instruments for measuring and evaluating (Moore, 1997).

The Italian government has made numerous efforts to regulate public employment at central and local levels, introducing elements of motivation and reward in order to incentivise performance (Pollitt & Bouckaert, 2011). In line with this trend, many countries have implemented a Performance Related Pay (PRP) system, but often with mixed or downright disappointing results (Gaertner & Gaertner, 1985; OECD, 2005; Perry & Pearce, 1985; Perry, Engbers, & Jun, 2009).

The present study aims to evaluate the recent developments in public sector performance measurement and evaluation in Italy by comparing them within the European panorama.

Monetary Reward Versus Motivation: Business Economic and Psychological Aspects

It is widely held that public servants are on average less efficient than private employees (Delfgaauw & Dur, 2008). For a long period, public administration was known for its lack of any kind of incentive system that might reward improved performance of its workers. Some authors believe that this has attracted employees "unwilling to sacrifice," thus compromising the whole sector's performance (Tulloch, 1965). But numerous authors, by examining the connections between staff motivation, their efforts and monetary incentives, have concluded that public employee incentives do not always reflect the effort they put into their work (Festré & Garrouste, 2008).

The reward is not exclusively made up of monetary incentives, but comprises many other nonfinancial aspects, such as internal organisation, HRM and sociological and psychological elements (Frank & Lewis, 2004; Le Grand, 2003). Nonetheless, monetary incentives are a fundamental part of the reward system. Moreover, if the organisation's

strategies are to be effectively put into action, they must be closely aligned with personnel policy and fully shared by employees (Herrero de Egaña Espinosa de los Monteros & Soria Bravo, 2012; Kaplan & Norton, 2004). Employee engagement has been identified as a critical business driver capable of impacting an organisation's overall success (Corace, 2007). Even if most of what has been written about employee engagement can be found in practitioner journals, in academic literature it has been defined as a distinct and unique construct that consists of cognitive, emotional, and behavioural components that are associated with individual role performance (Macey & Schneider, 2008; Saks, 2006). …

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