When do Budget Cuts = improvement?

I recently attended the IEWM (Improvement and Efficiency West Midlands) conference #IEWMconf14 - sponsored by Virgin Media. 

Surrounding the overt acknowledgement of increased service delivery challenges, in the face of increasingly reduced access to finance, with plenty of stats provided to support the negative forward view, e.g. a 7% avg. year-on-year budget reduction for all councils across the country to 2020, while Central Government continues to expect stable or improving service delivery, I have to say, I was impressed with the level of acceptance of some pretty advanced leadership issues within the ‘Public Sector’ community. 

I heard and held some very rich conversations!

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You see, I was attending on behalf of SSD, a consulting company specialising in Public Sector Transformation who are growing rapidly due to their successful track record; but my background is predominantly Private Sector, albeit Manufacturing and Service. 

What I saw and heard was a direct reflection of the organisational efficiency challenges I’ve been dealing with in ‘for profit’ organisations for over 20 years around Europe. 

What I heard in the public sector (with a few new words thrown in) was ALL I’ve ever heard in the private sector; after all, Public or Private sector, getting people to ‘achieve results together’within a hierarchical organisational structure poses the same challenges and barriers no matter the product, service or language used.

Improved performance will always be about ‘People’ and how they work together … how they communicate … if they share aligned or opposing opinions … how they are ‘being’ … which ultimately dictates what they ‘do’ and how they go about it. 

In industry we talk about Growth, EBITDA, New product introduction, ROI, R&D budgets, SO&FP and Make vs. Buy decisions in terms of our projected profit plans (incl. Lean, Systems thinking, agile and Six Sigma etc.) and in the Public Sector, I heard talk of the Barnett Formula, the impact of frozen council tax rates, fiscal devolution and serious service failures, also with reference to Lean, ST/SS etc. … but in between the different language, I heard the same challenges and themes I’ve noticed in industry for over 20 years … and those ‘common’ themes and challenges manifest when ‘People’ are trying to work within a socio-technical system to achieve more for less.

Now, I got 10 years into my own ‘Change leader’ experience and realised the application of industry best practice ‘tools’ often failed completely or slipped significantly in the face of such ‘Human Factors’.

For the last 12 years I’ve been studying Philosophy, Psychology and Neuroscience to better understand the ‘people’ (Socio-psychological) side of organisational performance improvement. This has led to a very clear and scientific approach to the change and improvement alluded to under broad terms like culture change, empowerment and autonomy. It has also led to a very specific definition of Culture which includes the element of human values.

You might be surprised just how invested many private sector leaders are in their current beliefs and just how much they struggle to see the bottom line value in addressing some of these bigger socio-cultural issues with any degree of rigour.

So, hearing the president of Solace, Mark Rogers talk about ‘Values Based Leadership’ at the IEWM conference was incredibly refreshing. What was even more encouraging was the murmurs of approval I heard from the majority of the audience.

With that and Che Smith from Virgin grabbing the audience with great quotes, like the one he cited from the (as he put it) great philosopher ‘Mike Tyson’, who reportedly said, “Everyone has a plan, then you get punched in the face”, I was pleasantly surprised at how the public sector leaders in attendance were seeing the world and taking on board the real ‘root-cause’ issues behind performance improvement and increased service delivery - the capability for people to 'adapt'.

I know it’s going to be tough going forwards for many councils, and I hope to be a part of many solutions, but you know, given all I heard on the day, I think we’ll pull it off and be a much more efficient country as a result.

So, the answer to the question in the title ... when do budget cut's = improvement?
When you have the right 'mind-set' in those leading the way!