How do local governments manage their performance? the effect of psm, organizational, and environmental determinants on effective performance management in Ghana: the case of local government employees in the greater accra region

Abstract

Managing people for development is not an easy task and at the same time finding a management tool to effectively unleash the potential of employees to contribute to development through a local government system may appear a difficult exercise. In the management literature, reference is made to several tools developed, especially in private sector, to make organisations monitor and use performance information to measure employees’ performance. However, the managerial principles that govern the public sector make it highly challenging to introduce management control systems which to a very large extent are carved out of the principles of private sector management. One significant observation of this challenge is that the ethos of the public sector is uniquely different from the private because there is goal-ambiguity in the former while the latter is a straightforward one, namely- profit maximisation. Despite the difficulty embedded in public sector management, there have been renewed efforts to introduce the principles of performance by results through performance management systems. Although this a doubtful step, largely because the rational bureaucratic system has been the main feature of public management since the introduction of new public management in the early part of the 1990s, many developing countries have experimented with performance measurement and management to ensure public managers deliver quality services and are accountable for their performance.

Performance by results or goals is not new because, from the work of Drucker (1954), which centres on management by objectives, organisations are supposed to align individual and organisational goals to achieve the overall mission of the organisation. In the same vein, Beer and Ruh (1976) use of the term ‘Performance Management’ which influenced the scholarly literature on performance management. However, one clear limitation of the extant literature on PM is that most scholars try to find a set of factors that explain its effectiveness by using rational theoretical frameworks with few attempts to include in this discussion, non-rational frameworks like national culture, organisational subcultures and public service motivation (PSM). This study comes handy to fill this gap by examining these set of variables along with other determinants of the organisation and the environment that may potentially explain the effectiveness of PM reforms in the Ghanaian context by focussing on the local level of management. Hence, this study developed a model that explains the relationship between three organisational and two environmental determinants, as well as the effect of PSM on the

four dimensions of effective performance management. Using 441 local government service employees in the Greater Accra Region and a sample of 10 top management servants from three organisations: the Public Services Commission, the Office of the Local Government Service, and the Greater Accra Regional Coordinating Council, the hypotheses were tested using multiple regression techniques. The various constructs of the variables were validated using exploratory factor analysis and to check the internal consistency of the individual scales, the alpha Cronbach reliability test was used. All the measurements used for the final analysis were suitable because during the factor analysis, some measures that had low correlation matrices were removed and those that met the cut-points were further screened for the multiple regression analysis

The findings indicate that national culture and organisational subcultures have an effect on EPM. The results showed that, although national culture has implications for PM reforms in Ghana, the presence of organisational subcultures like religiosity and dishonest practices have the potential to impede the gains on PM institutionalisation in the country. The most important national culture traits in the context of Ghana that affect EPM are collectivism and male-dominance

Furthermore, the findings of the study suggest that organisational determinants such as the development of result-oriented performance measures, the use of performance information as well as clear and measurable goals were significantly and positively related to total effective performance management. Also, with each of the four dimensions of effective performance management, only ‘clear and measurable goals’ had a negative and insignificant relationship with a performance review. Additionally, the findings indicate that the PSM construct has a positive and significant effect on EPM while two (‘commitment to the public interest’ and ‘civic duty’) of the five dimensions of the PSM construct had significant and positive impact on two dimensions of effective performance management, strategic planning and performance monitoring and evaluation. While ‘attraction to policymaking’ had a positive and significant effect on performance review and performance monitoring and evaluation. Likewise, compassion had a positive and significant effect on performance review. Whereas, ‘self-sacrifice’ had a positive relationship with all the four dimensions of EPM, but with no significant effect. However, the findings suggest that the environmental determinants, thus stakeholder participation and political support were least predictors of EPM, with ‘stakeholder participation’ having a positive relationship yet no significant effect EPM, whereas political support had a positive and significant effect on EPM. Nonetheless, the findings on the four dimensions of EPM, indicate that ‘stakeholder participation’ had a significant and positive effect on all four, while political support had a positive and significant effect on only three, except performance monitoring and evaluation. The implication is that the environmental determinants may not contribute to effective performance management, however, involving stakeholders and gaining the support of elected officials in some activities of the PM cycle, like strategic planning, performance monitoring, review and improvement, may in the longrun support performance-based reforms at the local government level. Finally, the use of goal-setting, structural contingency and public service motivation theories are useful in explaining the process by which effective performance management is achieved. By concentrating on these three theories, a more complex view of PM and how organisations can use this multidimensional view of EPM to increase the outcomes of

governmgovernment programmes and projects at the local level have been offered.ent programmes and projects at the local level have been offered.