copy the linklink copied!Chapter 2. Investing in People for Administrative Capacity

The skills model identifies various gaps in MAs

Applying the skills model above to the five MAs that participated in this pilot action, the following strengths and gaps could be identified.

Policy advice and analysis skills: The need for a more strategic approach to MA management (discussed in Chapter 4) was often raised during the OECD missions to the five MAs. However, in some MAs, the MA was essentially divorced from any policy function, and instead was positioned as an operational delivery mechanism to various extents. In this way, there was insufficient concern for developing and leveraging policy skills in the MA that could contribute to the design and development of ROPs, and align the work of the MA to the regional development strategies that they advance. Given the proximity of the MA to the delivery of strategy, this raises risks around misalignment of MA activities (e.g. project selection) with strategic objectives. If an MA uses only operational KPIs (e.g. amount spent, number of financial corrections), for example, it may risk not achieving the objectives of the policies that guide their work. In addition, MAs have a lot of practical experience that could be leveraged for better ROP/regional development strategy development.

Service delivery and engagement: While MAs may not deliver services directly to citizens, they do so with beneficiaries. In all of the diagnostics there was a recognition of the need to better communicate and engage with stakeholders beyond the MA, and in particular with ESIF beneficiaries. Some MAs work very closely with their beneficiaries and count them as close partners in the operation of successful ESIF. There was often recognition that beneficiaries not only needed more information and support to prepare and implement projects, but also had insights that could be used to improve the design of strategies and processes by the MA. Part of the challenge is that stakeholder management and engagement tend not to be a professionalised function in most of the MAs that participated in this pilot action, and therefore is often undertaken by people who do not see it as core to their work, and who lack the necessary skills and time.

Commissioning and contracting: MAs carry out a range of actions related to the control, distribution and use of ESIF funds, such as ex-post control and reviewing the lawfulness of public procurement during verification of beneficiary expenses. This is a core function of the MAs and is an area of clear need for capacity-building on the skills and competencies required to carry out effective and efficient public procurement tenders. Rarely do employees of an MA have a background in engineering or other technical specialties that would enable them to fully understand the complexity of the projects they manage. With this kind of skills asymmetry, many MAs resort to rule-oriented process specialisation (e.g. ensuring that forms are filled out correctly) rather than substance and understanding (e.g. ensuring that what’s in the forms really makes sense and is viable). A related challenge is that the rules they follow are often perceived to be somewhat vague and open to interpretation, and therefore require a high degree of legal understanding and authority. This is further discussed in Chapter 5.

Managing networks: Collaboration within the MA and across the Management and Control System (MCS) is another area which emerged as a common challenge, particularly when multiple ministries and agencies, levels of government or sectors are required to work together to develop and implement ESIF-funded projects. This kind of coordination function was also rarely centralised and professionalised, but rather dispersed across the MA and not always conducted systematically. This suggests the need to recognise this as a core skill and support its development and deployment.

Turning to the three dimensions (professional, strategic and innovative) of the framework also enables a discussion of the following gaps:

Professional: Most MAs struggle to find people with the right qualifications and knowledge. This is generally due to a combination of labour market limitations, unattractive pay and employment offers, and/or hiring constraints imposed across the civil service (e.g. hiring freezes). In order to find a solution, many MAs resort to hiring generalists who learn to follow complex rules without the professional skills needed to understand the complex projects and systems they are managing.

Strategic: Aligning MA operations with strategic objectives of OPs and development strategies requires effective leadership and management to link the various work streams in a coherent manner. Management and leadership skills were often identified as lower priority in many MAs. They were often not prioritised in recruitment and promotion. In some cases, senior managers are appointed by political leaders with little control in place to ensure they have the necessary skills and knowledge.

Innovation: With a rules-based system where employees only see their small part and have little time to consider improvements, it is not easy to identify the ways forward in terms of system improvements. Most employees interviewed felt a sense of powerlessness to make adjustments that they felt would improve operations and strategic impact of the MA.

To fill the skills gaps identified, MAs can use a combination of recruitment and training. The next parts of this Chapter look at those in turn.

MAs were generally very restrained in their abilities to recruit candidates to fill skills gaps

Regarding attractiveness, many MAs report low numbers of qualified applicants to job openings. This is often due to a range of factors such as pay freezes and tightening labour markets. In cases where the pay is too low to attract the needed skills, MAs and their leadership should carefully consider options to provide a more competitive employment package. Many MAs do this by using their Technical Assistance budget to “top-up” the salaries of those working on ESIF. MAs report that this has helped reduce some problems related to staff turnover, although such problems still exist in many MAs due to heavy workloads and stress. It also affects internal salary equilibrium across the broader public administration.

In order to attract professionals, MAs could more clearly articulate the non-financial benefits of working in their organisation, appealing to candidates’ desire to contribute to economic development and learn how ESIF processes work. This kind of employer branding effort has to be reinforced with real support, however. The use of on-boarding mechanisms or induction training and career development tends to be under-developed in MAs and these tools, if well developed and communicated about, can help to attract promising candidates.

In some MAs, the specific hiring process is conducted by the MA with approval from a central authority, and here steps could be taken to improve hiring processes to align with strategic orientations of the OP. Hiring criteria could be better aligned to the skills needed and/or the willingness and ability to develop them, and hiring managers could be more effectively trained in selection techniques. Another action that appears in some of the Roadmaps is to better coordinate with universities and leverage possible expertise among students and faculty for specific projects that could add value to the MA.

In most of the participating MAs, the biggest problem with recruitment were freezes imposed by central administration offices. In many cases, MAs were not free to hire new staff to meet operational needs without agreement from central authorities, even when funding was considered available. There was often a sense of frustration that the relevant HR authorities (e.g. the HR office of the ministry housing the MA, and/or ministry of public administration) did not understand the specific needs of MAs and were very slow to react to requests. MAs often felt captured in a public employment system that was not fit to their purpose.

Slow and ineffective public employment and HR systems, coupled with what appears to be an increased workload in many MAs, is creating high-stress working environments in which not even TA top-ups are enough to retain the best employees and keep them engaged and motivated. This generated in a sense of powerlessness among MA management and leadership, which lacked the tools and support necessary to make the changes needed to improve their workforce development situation. In that sense, most of the skills development focus was on training rather than on recruitment possibilities.

Nevertheless, there are examples of MAs that have developed innovative solutions to recruitment challenges. For example, in preparation for the 2021-2027 period, Calabria, Friuli-Venezia-Giulia and Umbria in Italy have collaborated to set up a registry of chartered accountants specialised in the management and control of programmes co-financed by ESIF (Agenzia per la Coesione Territoriale, 2019[4]). This project was extended to include other administrations, such as those in Emilia-Romagna, Liguria, Sicilia and Trento. The purpose is to facilitate access by MAs to candidates with sought-after skills but who can prove difficult to attract. The registry was be piloted until end 2019 and will be assessed by independent evaluations occurring as part of the Italian Plans for Administrative Reinforcement (PRA).

Table 2.1 below highlights some possible actions identified by the five MAs participating in this pilot project, and their stakeholders, to address the challenge of taking a more strategic approach to recruitment.

Given the significant limitations placed on recruitment, most MAs aim to address skills shortages through training opportunities for their current workforce. In this area, assessment is not only needed in the quantity of training available to staff (cut back in most OECD countries following the 2008 crisis), it is critically important that the quality of training is aligned with organisational objectives and labour market needs. Training also goes beyond a tool for equipping staff with the know-how they need to perform tasks. Metsma argues that it plays a key role in staff motivation, and indeed surveys of recent graduates frequently cite the opportunity to learn as a key motivator (Gallup, 2016[5]). Moreover, training can also be seen as a tool to inculcate shared values and a positive organisational culture (Metsma, 2014[6]).

The PSLC takes a similarly expansive view of training and development and recommends developing necessary skills and competencies by creating a learning culture and environment in the public service, in particular through:

1. a. Identifying employee development as a core management task of every public manager and encouraging the use of employees’ full skill-sets;

2. b. Encouraging and motivating employees to proactively engage in continuous self-development and learning, and providing them with quality opportunities to do so; and

3. c. Valuing different learning approaches and contexts, linked to the type of skill-set and ambition or capacity of the learner.

Training in MAs meets some short-term needs but there is scope to take a more strategic and long-term approach to leaning and development

Two recurring themes in interviews with MA staff were (i) that training was insufficient to keep them abreast of the latest developments with legislation, regulations, procedures and processes; and (ii) that training was not perceived as something that added significant value to day-to-day work and longer-term career and personal development.

For example, in one MA, staff noted that training courses occurring abroad were seen by managers as ways to reward staff. While this may be considered a legitimate management technique designed to galvanise performance (and in some cases was perceived to be the only “reward” that the management team could offer to high-performers), the result was that part of the staff conceived of training as a ‘perk’ or bonus to be assigned by a hierarchical superior. In another MA, new staff are immediately entrusted with significant responsibilities but lack the training and guidance to carry them out effectively.

In some cases, managers volunteer to run training sessions based on their own experience. While this is a laudable effort to transmit knowledge, it is illustrative of the constraints the MA faces in developing a comprehensive learning and development strategy. In another MA, where staff were obliged to attend a minimum number of training courses each year, there was a clear signal in interviews that the training did not meet the expectations of staff or add value to day-to-day work.

What emerges from the above examples is that, on the whole, training initiatives are either un-coordinated or carried out on an ad-hoc basis. Or, where a training strategy exists, there is little evidence to suggest that it is systematically applied and reviewed.

Staff expressed a desire for training that could improve their skills, improve the work of their MAs, and improve the impact of the projects they manage. Training was often requested on specific legislative and regulatory/procedural requirements for ESIF administration because many staff felt that these complex requirements changed often, at short notice, and with little consultation on their design or impact. This sense of ‘moving the goalposts’ creates delays in programming due to the need to learn and adapt to new requirements. It increases the workload of staff, pushes up transaction costs in engaging with actors at various levels of the MCS, and over time can lead to demotivation and disengagement.

In most OECD countries, competency frameworks are used to align training and development to organisational and individual development needs, and link training to career progression. The lack of a competency framework in most MAs means training does not address the long-term needs of the organisation, nor of individuals. Instead, training is either seen as a perk or a burden rather than as a core staff and organisational development activity.

There also appeared to be very little investment in induction training for new hires or those recently assigned to new roles and tasks. Many of the staff in MAs recognised that formal induction programmes could help new hires to learn about the strategic importance of their jobs, and how they fit into the broader ESIF system. However, in the absence of such programmes, new hires and existing staff are expected to learn ‘on-the-job’ with little systematic support.

Work load pressure means training is rarely prioritised or encouraged. This is particularly true when learning is not well aligned to the needs of individuals and their organisations. If training is not appropriately tailored to local reality, it risks getting labelled as a waste of time and written off completely.

Targeted management/leadership training was particularly underdeveloped. This may in part be due to a sense that managers in some MAs have very little discretion, and senior leaders are sometimes political appointees with little long-term commitment and vision for the MA. However these perceptions suggest an even greater urgency for meaningful leadership interventions.

The Campania region in Italy may provide food for thought in this regard, as it carries out a gap analysis on skills for the senior management of the Regional Council of Campania (Agenzia per la coesione Territoriale, 2019[7]). The results of this analysis are shared with the National School of Administration, which then plans training accordingly. The process is governed by a special agreement between the SNA and the Campania Region.

There is also little engagement with beneficiaries to identify their training needs, despite broad acknowledgement that time invested in training beneficiaries on various programming procedures pays off in the long-term with fewer errors in paperwork. While training beneficiaries may not always be the MA’s immediate responsibility, there was often recognition that the capacity of many beneficiaries urgently needed improvement, and investments in this area, by MAs, National Coordination Authorities or others, would be an investment with high return.

Towards a more strategic approach to learning and development

Training is a valuable tool in addressing skills and competency gaps. However, one of the key observations of this project is that the scope of much of the training carried out by MAs is relatively narrow. The analysis conducted of the five diagnostics reveals that the complexity of managing EU funds requires a broader perspective and range of professional competences. Rather than just playing a stop-gap role to ensure MA staff implement changes in legislation, learning and training should contribute to the strategic development of the MA and its employees. In this sense it should differentiate between the needs of staff at the operational and leadership levels. The operational and strategic challenges faced by MA staff require the development and deployment of a range of behavioural, cognitive and interpersonal competencies, such as creative problem-solving, strategic thinking and communication, negotiation and complex project management.

Ahead of the post-2020 period, this is a significant challenge. Success in channelling ESIF will depend not only on accumulated institutional expertise, but on the ability of MAs to develop a targeted, relevant and accessible learning and development strategy that goes to the heart of the operational and strategic challenges faced by staff. The main vehicle for MAs to reach the adequate level of skills and competencies to manage ESIF is a long-term “learning and developing strategy” which should also include an institutional link to hiring processes and job profiles in the MA.

To develop such a strategy, an important preliminary step, highlighted in many of the Roadmaps, is the need for an evidence-based gap analysis, to understand which skills and competences are available in the MA, and which ones should be developed in order to properly manage ESIF-financed projects. The European Commission’s competency framework and self-assessment tool is designed to provide this kind of analysis (Box 2.2).

Based on an assessment of skills gaps, a learning strategy could then map out different learning opportunities that could be used to help fill those gaps. This may include courses offered locally, by national schools of government, by the national coordination authority, by the EC or private contractors. It could also include other forms of learning, such as mentorship and coaching, job shadowing, short-term assignments and secondments. This mapping of different learning opportunities is an essential step as often MA managers were unaware of training and development opportunities within their own administrations, and at the European level (Box 2.3).

The OECD has worked with several EU countries to map and develop capability in thematic areas. For example, the Public Procurement Unit of the OECD Directorate for Public Governance worked with local authorities in Bulgaria to support the development of administrative capacity, training and dissemination of information, ensuring the effective application of public procurement rules through appropriate mechanisms. This included a ‘Train the Trainers’ initiative where the purpose was to provide future trainers with high quality material on public procurement to enable them to train procurement officials effectively all around the country (OECD, 2016[9]).

Another focus of the learning and development strategy should be on managers, as they constitute a key group that should take part and benefit from training. In this sense, the strategy should be linked to organisational hierarchy, so that new managers and those who aspire to become managers can access learning opportunities that will maximise their impact and ensure they have the skills necessary to manage and motivate teams.

With a precise strategy, by defining their “starting level”, managers could assign learning objectives to staff, which could access the strategy to understand how their skills and competencies can evolve and help their career and personal development.

Two other key elements of this strategy could also be the implementation of induction and mentoring programmes. Induction training is fundamental to accelerate the process of integration for new staff. Mentoring, which could be included as part of an induction programme, is crucial to avoid the loss of experience when staff leave for jobs outside the MAs.

A mentoring programme could also be applied to new managers to facilitate their transition to new responsibilities, as well as dedicated coaching or training sessions. The direction to pursue is the design of a common training and, eventually, a common competency framework.

Encouraging staff to take greater ownership of their own learning and development objectives, such as through creating a greater link with periodic performance assessments or the development of an ‘on-demand’ course catalogue for common training needs would be one way to shift the perception of training.

Table 2.2 below highlights some possible actions identified by the five MAs participating in this pilot project, and their stakeholders, to address the challenge of taking a more strategic approach to learning and development initiatives.

Employee engagement is suffering in some MAs

It was beyond the scope of the diagnostic phase of this pilot project to conduct employee surveys to gauge and compare levels of engagement in MAs or Management Control Systems more broadly. As such, it is important to note that the following assessment has been made on the basis of (representative) multi-stakeholder workshops and interviews. For the same reason, it is also difficult to ascertain the exact drivers of low employee engagement, where it was reported. This lack of data on engagement, however, is perhaps the most important finding in and of itself, as this is an important metric that MAs and MCSs should be systematically monitoring.

Anecdotally, several (though not all) of the five participating MAs reported issues with low employee engagement stemming namely from: perceptions of poor management practices; lack of career development opportunities; perceived lack of fairness in the assignment of promotions, bonuses, or training opportunities; and high levels of workload (particularly during certain times of the year and for those dealing with both beneficiaries and other government institutions). A perception of highly bureaucratic procedures, and the implications this had on individual ability to carry out duties effectively, was also mentioned as a possible source of frustration for employees and of lower engagement. Unsurprisingly, the MAs reporting higher levels of employee turnover (churn) were those also reporting lower levels of engagement.

Performance management systems were also reported to influence levels of employee engagement. While well-intentioned, some fell short of individual staff expectations since they were not seen as being linked to career development opportunities or salary increases. On the whole, performance management regimes did not result in employees receiving constructive feedback, but rather they seemed to have a significant effect on the motivation of staff, who felt that their efforts are not being recognised or rewarded, causing some to eventually burn out and leave the MA.

As mentioned earlier, many countries actively manage employee engagement. This is usually based on a process of measurement through employee surveys, which enable public organisations to benchmark their results, identify areas of high and low engagement, and take appropriate action. Well-designed employee surveys enable an understanding not only of relative levels of engagement across and within organisations, but also the factors that drive low or high engagement, and thereby the levers available to management to address and improve engagement

The majority of participating MAs do not have in place a strategy for measuring or improving employee engagement, with little to no data from employees collected through perception surveys. As such, the Roadmaps focus on addressing this critical “information gap” through the development and implementation of their own employee surveys. This is a key first step to assessing where problematic teams/leadership might exist, as well as uncovering the specific drivers as per different entities within the MA or MCS. MA or MCS employees who are also civil servants might complete employee surveys implemented by their central or regional administrations, however given that many personnel working on ESIF may be public employees (i.e. without civil service status), or contractors, it was deemed important that MAs design and run their own surveys aside from these.

While collecting quality employee engagement data is one key first step, this is certainly not sufficient without adequate follow-up and action from leadership. Indeed, measuring employee engagement through employee surveys will not, in itself, contribute to improving employee engagement levels if nothing is done with the results. As such, several Roadmaps include actions to conduct leadership workshops or seminars around employee engagement to review and discuss results, with the ultimate goal of designing and implementing interventions that address pockets of low engagement.

Managers and leadership were targeted for the seminars for several reasons. First, middle to upper managers have the power to implement changes that may boost engagement. Issues like work-life balance and the working environment are areas where managers can have a high degree of influence. Additionally, managers’ leadership styles can influence engagement – the way they communicate with employees, for example. The United Kingdom offers an example on the types of leadership behaviours that were found to increase engagement (Box 2.4). This places expectations on the skills and capacities of managers. Positive leadership traits and behaviours should be reflected in competency frameworks, which were also reflected in other Roadmaps actions to strengthen managerial capacities.

Second, in the Roadmaps, managers were chosen as the recipients of the workshops/seminars on engagement in order to create a sense of accountability around this important issue. Comparative data (i.e. benchmarking employee engagement results by team or organisational units) can be a powerful incentive for managers to make real changes. Countries like Australia, Canada, the UK and the US use Dashboards to communicate results, and employee engagement data are included in performance discussions.

Concerning performance management systems, MAs sometimes have a degree of flexibility on the application of these regimes, which the OECD often found to be misaligned to promoting engagement and motivation. Roadmaps therefore included actions focused on reviewing performance management systems to ensure that they are rewarding the kind of performance expected and encouraging employees, rather than focusing only negative consequences. The actions also emphasized improving communication around the tools, so that staff had a better understanding of what was being assessed and how the system was designed to work. Finally actions also emphasised the need to make sure that all of the managers had a common view of the system and could apply it evenly across their workforce.

Table 2.3 below highlights some possible actions identified by the five MAs participating in this pilot project, and their stakeholders, to address the challenge of employee engagement.