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Part 4: Detailed assessment of department capability

This section provides an assessment framed by the leadership–strategy–delivery structure of the capability review model.

Assessments were made according to the assessment criteria set out in Figure 3.

Figure 2 - Rating descriptions
Assessment rating Rating image Rating description
Strong
  • Outstanding approach for future delivery in line with the model of capability
  • Clear approach to monitoring and sustaining future capability with supporting evidence and metrics
  • Evidence of learning and benchmarking against peers and other comparators
Well placed
  • Capability gaps are identified and defined
  • Is already making improvements in capability for current and future delivery, and is well placed to do so
  • Is expected to improve further in the short term through practical actions that are planned or already underway
Development area
  • Has weaknesses in capability for current and future delivery and/or has not identified all weaknesses and has no clear mechanism for doing so
  • More action is required to close current capability gaps and deliver improvement over the medium term
Serious concerns
  • Significant weaknesses in capability for current and future delivery that require urgent action
  • Not well placed to address weaknesses in the short or medium term and needs additional action and support to secure effective delivery

The review team's assessment of the Department of Infrastructure and Transport's capability is outlined below.

DoIT capability review - leadership
Capability Assessment rating Rating image
Set direction Well placed
Motivate people Well placed
Develop people Development area
DoIT capability review - strategy
Capability Assessment rating Rating image
Outcome-focused strategy Development area
Evidence-based choices Strong
Collaborate and build common purpose Well placed
DoIT capability review - delivery
Capability Assessment rating Rating image
Innovative delivery Well placed
Plan, resource and prioritise Strong
Shared commitment and sound delivery models Well placed
Manage performance Well placed

4.1 Leadership summary

Set direction

  • While the Secretary in particular is recognised as a skilful leader of change, leadership qualities across the broader SES cohort vary.
  • The department has a clear sense of the Secretary's aspirations—the five directions vision. These directions are not, however, supported by a clear and simple articulation of the department's strategic purpose. This results in confused expectations internally and externally.
  • The department can demonstrate progress towards achieving the five directions, but application is uneven and results are mixed.
  • The departmental executive could usefully involve the executive directors more directly in making strategic resourcing decisions and in assisting to better articulate departmental strategies to staff and stakeholders.
  • Many of the SES cohort are rightly respected for their technical expertise and ability to deliver. The executive management team could place more emphasis on the SES cohort's management responsibilities.

Motivate people

  • The Secretary and executive have created a collegiate culture with a commitment to delivery. Senior staff embrace the new directions and strive to follow the Secretary's lead.
  • Internal and external stakeholders acknowledge that the department has undertaken a positive cultural shift in recent years. Some feel that more could be done to ensure it operates in a coordinated and consistent way. This would include promoting unifying cultures, values and behaviours.
  • There is a tension between the concept of a high-performing department and elements of the current departmental culture.
  • Issues affecting employee motivation and engagement have been recognised by the department for some time and are articulated in its workforce plan and career management strategy. To maximise available resources, it will be important for all managers to engage more strongly in managing underperformance.

Develop people

  • The department's technical expertise in regulatory and analytical areas is respected and significant improvement has been made in the development of new capabilities, including strategic policy development, 'informed investment' and collaboration/stakeholder engagement. Internal and external stakeholders recognise that this remains a work in progress.
  • Clear articulation of the department's future strategy is needed to inform more effective workforce planning and thereby to fill future capability gaps.
  • Performance expectations are not always clear. The departmental narrative might include a clearer articulation of the desire for high performance to empower managers to get the best from the workforce by managing individual performance in a more consistent way.
  • There is a significant risk in reliance on key individuals and the department has rightly identified the need for succession planning. This needs to be addressed in a formal and ongoing way.

Comments and ratings against the components of the 'leadership' dimension follow.

Set direction

Guidance Questions
  • Is there a clear, compelling and coherent vision for the future of the organisation? Is this communicated to the whole organisation on a regular basis?
  • Does the leadership work effectively in a culture of teamwork, including working across internal boundaries, seeking out internal expertise, skills and experience?
  • Does the leadership take tough decisions, see these through and show commitment to continuous improvement of delivery outcomes?
  • Does the leadership lead and manage change effectively, addressing and overcoming resistance when it occurs?
Rating

 Well placed

The Secretary has set out his aspirations for the department in the form of his five directions vision. Feedback suggests that the SES cohort clearly articulates these directions and they have been consistently quoted and described by staff.

Overwhelmingly there is a feeling the department is moving in the right direction. A number of stakeholders have pointed to ways in which the department has clearly advanced in terms of policy development and regulation. However there is general agreement that the department still has some way to go to achieve the vision.

Feedback from staff below the SES suggests that although they are aware of the vision, some are not sure what it means for their day-to-day work. More effort is needed by all levels of management to explain in practical terms how it can be achieved.

The Secretary, Deputy Secretaries and others in the SES cohort are trusted, engaged and approachable to both staff and external stakeholders. However, some question the leadership qualities demonstrated by some of the SES group and below.

External stakeholders generally spoke very positively about the Secretary's carriage of his significant leadership responsibilities. This is a testament to his personality, experience and expertise in the portfolio. A reliance on the Secretary's capability also presents potential future risk for the organisation in terms of corporate knowledge and stakeholder relationships.

The Secretary in particular has been credited with initiating significant positive change over recent years. Many of these changes were in response to the strategic audit of the department commissioned by him in 2009. The department's successes over recent years have demonstrated its significant capacity for introducing change to the infrastructure sector. The Secretary has adopted an incremental approach to change; improvements have been realised in many of the areas recommended by the strategic audit without evidence of change fatigue.

If future departmental and administered resourcing were to become further constrained, the SES cohort would need to consider how it would prioritise in a more concerted and methodical manner.

Motivate people

Guidance Questions
  • Does the leadership create and sustain a unifying culture and set of values and behaviours which promote energy, enthusiasm and pride in the organisation and its vision?
  • Are the leadership visible, outward-looking role models communicating effectively and inspiring the respect, trust, loyalty and confidence of staff and stakeholders?
  • Does the leadership display integrity, confidence and self-awareness in its engagement with staff and stakeholders, actively encouraging, listening to and acting on feedback?
  • Does the leadership display a desire for achieving ambitious results for customers, focusing on impact and outcomes, celebrating achievement and challenging the organisation to improve?
Rating

 Well placed

Internal and external stakeholders point to the Secretary's abilities in bringing about a positive cultural shift in recent years. Many internal interviewees reported their efforts to 'follow the Secretary's lead' and many staff feel confident in the department's abilities and are committed to the work they do. The Secretary has been closely involved in a period of change and reform in the infrastructure sector and has taken a leadership role in articulating a national approach. He has motivated and mobilised many staff who have risen strongly to the challenge. However, there is a sense that this is not consistent and a 'gentle culture', valued in some parts of the department, can militate against a concerted push on underperformance issues.

Diversity of divisional cultures and practices is being felt externally. The grouping of technical expertise within divisions is important and valued by external stakeholders. At the same time, more could be done by all levels of management to promote unifying cultures, values and behaviours. Taking a more coordinated approach to policy advice, stakeholder engagement and regulation would increase the department's effectiveness and improve its influence with external stakeholders.

Results of the most recent staff survey suggest that staff are concerned about a number of issues, including limited opportunities for career progression and internal mobility, as well as insufficiently competitive remuneration. The new workforce plan recognises these concerns and has introduced measures to increase staff mobility within the department to support retention. However, this presents a challenge. External stakeholders indicated that they would like to see more stability in key positions, so mobility needs to be supported by measures which make staff changes seamless to stakeholders. There are good examples of where this has been done but succession planning and knowledge transfer need a more consistent effort on a department-wide basis.

Develop people

Guidance Questions
  • Are there people with the right skills and leadership across the organisation to deliver your vision and strategy? Does the organisation demonstrate commitment to diversity and equality?
  • Is individuals' performance managed transparently and consistently, rewarding good performance and tackling poor performance? Are individuals' performance objectives aligned with the strategic priorities of the organisation?
  • Does the organisation identify and nurture leadership and management talent in individuals and teams to get the best from everyone? How do you plan effectively for succession in key positions?
  • How do you plan to fill key capability gaps in the organisation and in the delivery system?
Rating

 Development area

The department has a number of personnel strengths; it has a well articulated workforce plan and a focus on workforce development in its business planning process. It also has a number of identified personnel issues, which the review team considers need to be driven very actively from the top.

Technical expertise in regulatory and analytical areas is generally respected. Many stakeholders commented that significant improvement has been made in developing strategic policy, informed investment and stakeholder engagement capabilities.

The department's enterprise agreement has generous provisions for professional development. The organisation encourages employees to avail themselves of its extensive development opportunities, which include regulatory lessons, leadership seminars and community of practice seminars.

Stakeholders generally consider the department's technical skills to be strongest in its aviation and airports responsibilities. Technical and market expertise is seen as being less evident in the other modal divisions.

In developing the department's leadership capabilities, further consideration might be given to formal development opportunities for the SES cohort. Closer or more active engagement by the senior leadership with the wider leadership group would also be a way of developing this cohort.

The current workforce plan process would usefully benefit from a better articulation of the department's role in supporting regulation and infrastructure. Recognition of the need to manage key person risk will also have significant implications for the workforce plan. Tendency to rely on key individuals may be at the expense of retention, diversity and development opportunities for others.

The culture of the department presents some challenges in consistently managing employee performance. The People and Performance Branch has recently focused on providing support for and strengthening the capability of managers and this has been positively received by managers.

The templates for individual performance plans include statements around participating in the performance management process and deliverables such as 'I will establish an environment that encourages high performance demonstrated by ... facilitating a fair, honest and supportive approach to deal with ... unsatisfactory performance', as well as 'taking action when underperformance is apparent' and 'considering reward and recognition of good performance'. Nonetheless, a stronger commitment to high performance in the departmental narrative and consistent articulation of expectations at the highest levels are needed. This would include ensuring that the performance expectations of individuals are clear, that the appraisal process includes consideration of performance against capability standards as well as defined tasks, and that trends are examined centrally and more closely by the SES cohort.

4.2 Strategy summary

Outcome-focused strategy

  • Significant progress has been made in supporting the development of national agendas, more informed investment management and building a strategic policy capability.
  • The department would benefit from a clear articulation of an overarching strategy and a supporting narrative to make the agenda for transport and infrastructure clear internally and externally.
  • While the department has clear aspirations as represented by the five directions, no concise statement of its role is widely available.
  • The failure to articulate the department's role in infrastructure has resulted in confusion around the respective roles of the department and Infrastructure Australia, which has implications for future capabilities.
  • The five directions would be well supported by introducing an articulated set of behaviours, measures of success or department-wide best practice strategies to achieve these aspirations.

Evidence-based choices

  • The department has a respected analytical base which provides a critical capability in reframing policy issues to facilitate reform. This has been strengthened in a number of ways in recent years, most notably through closer linkages to policy development.
  • The department has sought to articulate trends, future policy options and strategies. These views could be used to inform future strategic approaches and could also usefully be shared with other agencies to improve the perceptions of the department's policy work and to inform broader governmental policy considerations.
  • Most external stakeholders say that the department's industry knowledge has improved and link this to increased credibility in policy development. Industry would like to see a better understanding of broader market-related issues, including consideration to the costs of regulation.

Collaborate and build common purpose

  • Significant efforts have been made to improve consultation and build trust with external stakeholders. However, the strength of engagement and the capacity to collaborate appears to vary across the department.
  • The department would benefit from a more strategic approach to stakeholder engagement, communication and regulation.
  • The Minister regards the department to be responsive and much improved in its ability to provide strategic support.

Comments and ratings against the components of the 'strategy' dimension follow.

Outcome-focused strategy

Guidance Questions
  • Does the organisation have a clear, coherent and achievable strategy with a single, overarching set of challenging outcomes, aims, objectives and measures of success?
  • Is the strategy clear about what success looks like and focused on improving the overall quality of life for customers and benefiting the nation?
  • Is the strategy kept up to date, seizing opportunities when circumstances change?
  • Does the organisation work with political leadership to develop strategy and ensure appropriate trade-offs between priority outcomes?
Rating

 Development area

The department relies on its PBS to articulate its strategic approach. However, this document cannot be a substitute for a well articulated strategic framework. Such a framework is needed. In many instances during this review, departmental staff were unable to articulate a clear statement of the department's role and overall strategy, particularly in relation to infrastructure. This is particularly manifest in confusion expressed by some stakeholders about the respective roles of the department and Infrastructure Australia.

Over-the-horizon, strategic thinking is being done in the department and is progressively taking more of a national perspective. This is evident in the department's work on the Sydney region aviation capacity study, the High Speed Rail studies, the Nation Building Driving Australia's Productivity publication, the Commonwealth Infrastructure Investment Framework and the National Urban Policy, as well as other work in progress such as the east coast corridor network strategy and national regulators.

The department holds quarterly strategic planning meetings involving all SES officers. These could usefully be followed up in a more systematic way.

There is a strong appetite among external stakeholders for the department to take a role in leading the national debate in infrastructure and transport policy. They see this leadership role, including national collaboration and strengthening strategic policy, as being crucial in a climate of constrained resources.

The absence of a clear articulation of the department's role in infrastructure manifests in confusion among internal and external stakeholders about the respective roles of Infrastructure Australia and the department. The department is undertaking work in a series of generic infrastructure areas, including corridors, demographics, productivity, financing and pricing, which could form the basis of a more fully articulated infrastructure agenda.

There is a perception that the department, while being effective in responding well to government agendas, has not been as strong in its strategic capabilities. The department's investment in developing its strategic capabilities, particularly in relation to infrastructure issues, is not well understood externally and greater effort is needed to communicate and promote the results more broadly across government. This would have benefits for the perceptions of the department's policy work and also in informing broader government considerations.

Evidence-based choices

Guidance Questions
  • Are policies and programs customer focused and developed with customer involvement and insight from the earliest stages? Does the organisation understand and respond to customers' needs and opinions?
  • Does the organisation ensure that vision and strategy are informed by sound use of timely evidence and analysis?
  • Does the organisation identify future trends, plan for them and choose among the range of options available?
  • Does the organisation evaluate and measure outcomes and ensure that lessons learned are fed back through the strategy process?
Rating

 Strong

The department has a strong evidence base and credible analytical capability. The Secretary is focused on the need to maintain the department's policy and research functions.

The Policy and Research Division, including BITRE , is critical to informing the department's evidence-based choices and is respected internally and externally. It brings together research and policy development and contributes this across the department. BITRE 's work with the Major Cities Unit on the State of Australian Cities report and with Aviation and Airports Division on the Sydney region aviation capacity study has showcased its ability to influence the policy debate through relevant and high-quality research and analysis.

In infrastructure investment, the department is working towards the development of a benchmarking framework. It is developing standards for the assessment of costs and benefits to support investment choices, as well as a business assurance framework to verify the effective delivery of programs.

External stakeholders generally acknowledge that the department's industry knowledge is strong in some areas and that overall it is improving, albeit varying from division to division. Many staff have skill, experience and credibility in developing policy in their relevant field. Some stakeholders commented that the department needs to develop a better understanding of market-related issues in some sectors.

Collaborate and build common purpose

Guidance Questions
  • Does the organisation work with others in government and beyond to develop strategy and policy collectively to address cross-cutting issues?
  • Does the organisation involve partners and stakeholders from the earliest stages of policy development and learn from their experience?
  • Does the organisation ensure the agency's strategies and policies are consistent with those of other agencies?
  • Does the organisation develop and generate common ownership of the strategy with political leadership, delivery partners and citizens?
Rating

 Well placed

The department is responsible for policy issues across the broad range of portfolio activities. Portfolio agencies reported productive relationships with the department and a good level of information sharing. While these agencies have statutory independence, the department has a responsibility to provide advice to the Minister about issues across the portfolio, including emerging risks.

The department perceives itself as engaging more effectively across government. However central agencies suggest that more influence within government is needed and that the department should communicate more with them about strategy, priorities and forward agendas to build a common purpose. This includes doing more to define the department's role and objectives. The views of these central agencies suggest that the department needs to be more proactive in its engagement with them—advising them of, and seeking support for, its developing agenda and more overtly contributing to overall government objectives.

There has been a great deal of positive comment about the department's cooperation with state and territory governments to promote a national approach. Delivery of the national regulator reforms would not have been possible without the building of strong relationships. The department has been inventive and strategic in developing partnerships.

Most industry stakeholders commented that consultation has significantly improved in recent years and commend the department for involving them early in policy development. New collaborative approaches have been positively received, such as those undertaken for the shipping reform activities where key stakeholders were in the first instance invited to meet and share views before any detailed inquiry, research and decision-making occurred. This process is increasingly being adopted across the department, with similar approaches being employed in the urban planning and infrastructure investment areas.

Relationships with industry stakeholders are mostly, though not universally, constructive and stakeholders feel that staff are engaged, responsive and productive. The department has a high level of credibility as an interlocutor which is willing to lead and assist in resolving problems. However, both industry stakeholders and internal interviewees commented that there needs to be a more proactive and strategic approach to engagement, including limiting the scope for multiple contacts on related issues.

If the department's ability to influence by way of grant funding were to reduce, the strength of relationships, the ability to provide a compelling narrative and the capacity for sound evidence-based policy would become even more important. The department could usefully identify relationship building as a core capability.

A draft Stakeholder Engagement Handling Strategy and Strategic Communications Plan have been prepared but not yet finalised and implemented. This work could usefully be readdressed and followed up.

4.3 Delivery summary

Innovative delivery

  • The department has adopted new delivery approaches in recent years and can point to substantial innovation. However this is patchy and there remains a strong focus on the status quo in some regulatory areas.
  • The push to 'have a view' in the five directions vision statement provides licence for innovation. The review has received mixed messages concerning practices on the ground.
  • The department has been an important catalyst for the adoption of new models of intergovernmental decision making, particularly with the establishment of the national regulators.

Plan, resource and prioritise

  • The department's strength in business planning is commendable. There is clear line of site from government priorities to section-level activities and individual performance in annual plans.
  • Financial management is prudent, and financial literacy across the agency is fit-for-purpose. Budgets and business activity align.
  • The quarterly performance review process provides a framework for adjustment and reallocation of resources and provides a platform for decisions about prioritising in a more resource-constrained environment.

Shared commitment and sound delivery models

  • The department supports a variety of delivery models.
  • There is no overarching strategic framework that binds the department's various delivery models together and facilitates evaluation.
  • There is a case for a more strategic and whole-of-department approach to the management of regulation and stakeholder engagement.

Manage performance

  • Periodic reporting is well entrenched and discussion of divisional performance is collegiate and robust. Business, financial and human resources reporting are integrated. Conversations occur across key areas of corporate activity.
  • There is variability in the quality of reports, including audit reports, and in some cases these do not sharply focus on emerging problems or on risk mitigation strategies. The knowledge of current senior executives may mitigate this risk, but if there were changes to senior personnel, 'red flags' might not get the attention required.
  • The department has introduced a new evaluation strategy to incorporate evaluation into business processes for policy, program and regulatory activities.
  • There is commitment to continuous improvement in the department's operations. However there is an overreliance on tacit knowledge, and a need for crisper identification and management of risk, particularly with regard to portfolio and systemic risk. The appointment of an external chair to the department's Audit Committee could enhance risk identification and management.

Innovative delivery

Guidance Questions
  • Does the organisation have the structures, people capacity and enabling systems required to support appropriate innovation and manage it effectively?
  • Does the leadership empower and incentivise the organisation and its partners to innovate and learn from each other, and the front line, to improve delivery?
  • Is innovation explicitly linked to core business, underpinned by a coherent innovation strategy and an effective approach towards risk management?
  • Does the organisation evaluate the success and added value of innovation, using the results to make resource prioritisation decisions and inform future innovation?
Rating

 Well placed

The department has proven its ability to innovate and it has undergone a period of significant change. More could be done to acknowledge the innovative nature of much of the department's work and to encourage more innovation in areas that have yet to undergo substantial reform, for example the regulatory areas.

Perceptions are changing. The most improved question from the 2008 to 2011 departmental employee survey was 'We are encouraged to be innovative in our thinking.' In 2008, 32% of respondents agreed with this comment, while in 2011, 54% agreed.

There is evidence to support this, particularly in the area of intergovernmental reform. Under the umbrella of the Council of Australian Governments, the development of joint Commonwealth–state boards and project offices has encouraged a more national approach and enabled the department to reposition itself as a facilitator in establishing the national transport safety regulators. The work done by the NBII division in reframing the department's program management skills to that of an informed investor provides another example of the department's innovation capability.

The department's Regulatory Lessons Learned and Infrastructure Leadership seminars are well attended and offer scope for the exchange and cross-fertilisation of ideas.

The establishment of the Policy and Research Division provides a vehicle for innovative policy development, including through rotation of business area staff through the division.

The push to 'have a view' in the five directions vision statement provides licence for innovation. This couples with a deliberate attempt to foster from the top a culture of boundary pushing and a willingness to try something new.

Plan, resource and prioritise

Guidance Questions
  • Do business planning processes effectively prioritise and sequence deliverables to focus on delivery of strategic outcomes? Are tough decisions made on trade-offs between priority outcomes when appropriate?
  • Are delivery plans robust, consistent and aligned with the strategy? Taken together will they effectively deliver all of the strategic outcomes?
  • Is effective control of the organisation's resources maintained? Do delivery plans include key drivers of cost, with financial implications clearly considered and suitable levels of financial flexibility within the organisation?
  • Are delivery plans and programs effectively managed and regularly reviewed?
Rating

 Strong

The department has produced divisional plans with line of sight upwards to government priorities and downwards to section-level activities and individual performance agreements. This planning is taken seriously—the Secretary makes a formal reply to the business plans with a charter letter-style response to executive directors. Some areas cascade the letters down to branch level and beyond, creating a series of quasi-contractual relationships from the top of the organisation to the bottom.

Overall there is a sense that the plans are not just a compliance exercise, and there is active reporting against them on a regular basis.

Periodic financial reporting to the senior executive is robust, informative, transparent and generally easy to understand. Financial literacy among managers is fit for purpose. The monthly Business Managers' Forum ensures consistency in financial operations and reporting.

If future departmental and administered resourcing were to become further constrained, there would be a need for the executive management team to consider how it would prioritise in a concerted and methodical manner.

Shared commitment and sound delivery models

Guidance Questions
  • Does the organisation have clear and well understood delivery models which will deliver the agency's strategic outcomes across boundaries?
  • Does the organisation identify and agree roles, responsibilities and accountabilities for delivery within those models including with third parties? Are they well understood and supported by appropriate rewards, incentives and governance arrangements?
  • Does the organisation engage, align and enthuse partners in other agencies and across the delivery model to work together to deliver? Is there shared commitment among them to remove obstacles to effective joint working?
  • Does the organisation ensure the effectiveness of delivery agents?
Rating

 Well placed

The department supports a variety of delivery models. These cover a mixed portfolio of activities, including policy design and development, industry regulation, the provision and management of grants and investment for third party agents (for example state governments), and the provision of advice on project and program management.

There are multiple approaches to each delivery model. For example, some regulation administered by the agency is behaviourally codified and prescriptive, some is outcomes based, and some is the framework for self-regulation. There is a push in several areas of the department to streamline activity around best practice (for example, the 'regulatory compliance guides currently in draft form in several divisions), but a common, strategic framework has not yet been developed. There is evidence that the department is seeking to develop a regulatory framework but it may need to encourage a more aggressive culture of review so that its regulatory frameworks are appropriate to changing industry structures and market conditions, and operate to minimise unnecessary costs to business. Sharing occurs (for example, through the Regulatory Lessons Learned series), but what is required is an approach to regulation that is best practice, joined up and strategic.

The department faces a challenge in presenting a consistent external face. This is in part because it draws upon a variety of tools which are seen as alternatives rather than as part of a continuum. An area of concern among some external stakeholders is the relationship between the Office of Transport Security and other related areas of the department where the status of the office as a division is not well understood.

By contrast, the Policy and Research Division has been established in such a way that it does not stand apart from the rest of the department, but operates across divisions. Through secondments and taskforces it has integrated itself into the operations of the business areas.

The department has three high-level forums to assist the Secretary and senior management in decision-making: the Secretary's Business Meeting (held weekly and including the Secretary, deputies, Chief Operating Officer); the executive management team (held weekly and including the Secretary, deputies, Chief Operating Officer, executive directors, and corporate general managers as advisers); and the SES management team (held quarterly and as required, and including all SES ). The structure is sound but, as noted previously, consideration might be given to broadening the executive management group to involve the executive directors more directly to assist in developing their leadership qualities, in making strategic resourcing decisions and in assisting to better articulate departmental strategies to staff and stakeholders.

Information and knowledge management is critical in a department with key person risk and a significant staff turnover rate. Perceptions on this are mixed. Some SES officers worry about the robustness of the department's systems for information management and retrieval. There is scope for more sharing of lessons learned across the department and the Australian National Audit Office has commented that the department needs to explicitly set itself the goal of becoming a learning organisation.

Manage performance

Guidance Questions
  • Is the organisation delivering against performance targets to ensure achievement of outcomes set out in the strategy and business plans?
  • Does the organisation drive performance and strive for excellence across the organisation and delivery system in pursuit of strategic outcomes?
  • Does the organisation have high-quality, timely and well-understood performance information, supported by analytical capability, which allows you to track and manage performance and risk across the delivery system? Does the organisation take action when not meeting (or not on target to meet) all of its key delivery objectives?
Rating

 Well placed

There is clear line of sight in periodic reporting against business planning, financial and human resources information. Reporting materials are integrated and conversations across key areas of corporate activity occur (for example, through the Business Managers' Forum, and Finance, Reporting and Program Committee meetings).

Generally, the Secretary and Deputy Secretaries have a good feel for how the agency is travelling, and do not seek heavy briefing. The quarterly performance reporting process is taken seriously. The reports have a number of strengths but rely heavily on the tacit knowledge of the Secretary and Deputy Secretaries. Performance reports are used as a prompt for discussing issues and some are clear in identifying actual or potential problems and risk. This pattern of reporting would be inadequate if there were a change of key personnel at the top of the organisation. Prudence dictates that reporting should be improved now, including through a sharper focus on risk.

The documentation of outcomes is not communicated consistently to those who prepare reporting materials. Junior staff reported a desire for feedback on the results of the report discussions to ensure agreed outcomes can be considered and fed back into planning and delivery activities.

The department believes in continuous improvement and is prepared to critically assess its effectiveness. It has recently developed an evaluation strategy which aims to incorporate evaluation into normal business processes. This is a welcome initiative.

The Risk Management Policy, Guidelines and Enterprise Register constitute the agency's risk framework. In general, risk is effectively managed, but a system which places significant emphasis on the tacit knowledge of senior leaders is not sustainable. It may not identify areas of systemic risk and would tend to take responsibility away from those best placed to manage it.

The issue of key person risk presents at all levels of the agency. This is partly a function of the wide but thin spread of activities under the department's mandate, where one or two people can be the technical expertise on a transport or infrastructure issue for the Australian Government. The executive keeps a watching brief but as noted this will not be sufficient to address the issue.

Historically, there has not been detailed engagement with risk in the Audit Committee, and the recent appointment of a new external auditor presents the opportunity to further focus the committee's work. The review believes that this committee needs to capture a broader range of risks, and develop a clearer enunciation of those risks. The department should also consider the appointment of an external chair.