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 2.
|Assessment rating||Rating image||Rating description|
The review team's assessment of the Department of Human Services capability is outlined in the tables below
|Capability||Assessment rating||Rating image|
|Set direction||Development area|
|Motivate people||Well placed|
|Develop people||Well placed|
|Capability||Assessment rating||Rating image|
|Outcome-focused strategy||Development area|
|Evidence-based choices||Development area|
|Collaborate and build common purpose||Well placed|
|Capability||Assessment rating||Rating image|
|Innovative delivery||Well placed|
|Plan, resource and prioritise||Development area|
|Shared commitment and sound delivery models||Strong|
|Manage performance||Well placed|
4.1 Leadership summary
- The DHS Executive must operate and be seen to operate as a high-performing team, working in a highly collaborative manner and demonstrating mutual trust, confidence and respect.
- DHS staff are highly committed and a major asset to the organisation. All SES officers need to explicitly act as a team and as an exemplar to staff of a leadership group working to achieve a single vision.
- The DHS Executive has done a solid job at communicating the vision and rationale for the integrated DHS . At this stage in the department's evolution, staff are ready for more detailed and open communication and direction from the Executive.
- In pursuing more open communication, it is important that the DHS Executive ensures that all areas of DHS are able to engage with, and identify themselves in, the departmental narrative.
- The SES has rightly focused to date on binding the department together by leveraging the strong pre-existing cultures of service delivery in its predecessor agencies.
- The time is now right to be more proactive in establishing and articulating a unified ' DHS culture'. This can best be done by communicating, modelling and reinforcing the behaviours that are required to achieve the department's mission.
- The magnitude of the workforce transformation that is required to deliver on DHS 's strategic vision has few parallels.
- The department has done significant planning to deliver on the transformation of its workforce and is aware of and managing the associated challenges. The next steps are contingent on the department formulating a clear and concrete service design map.
- The department's workforce transformation can be supported by giving attention to day-to-day management issues such as addressing underperformance, meeting staff learning and development needs and talent management.
Comments and ratings against the components of the 'leadership' dimension follow.
- 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?
Making communication a priority
The DHS Executive has largely succeeded in crafting a high-level narrative around the necessity of integrating the human services portfolio into one department to enable 'excellence in the provision of government services to every Australian' (Strategic Plan 2012–16, p. 5).
It is a narrative in which the best of each master program is actively encouraged to come to the fore. Carefully promoted by the DHS Executive, it is an institutional account that virtually everyone in the organisation concurs with and strives to reproduce. This is no mean feat. Few APS 'start-ups' or established agencies subject to machinery of government reforms can claim such buy-in.
That said, it is evident that some sections of the department, notably the Child Support Program and CRS Australia, are still not clear about their roles within the integrated department or feel that they are not valued as genuine contributors to the work of the integrated department. Moreover, communication around the high-level agenda can fail to strike a chord with people, both within and outside the department. Many stakeholders are looking for a DHS story that is more explicitly linked to realities of 'helping people' and the critical role that it plays across Australian communities.
There is also genuine confusion in some parts of the department about the DHS Executive's overall message. Many messages come across as generic, and the hybrid branding formula the department has been working with (where the master programs retain an identity under a broad DHS banner) provides customers with a recognisable entity but feeds this sense of uncertainty amongst some staff.
In the opinion of the review team, the DHS Executive can now more effectively capitalise on opportunities to communicate substantive matters to staff in an open and honest manner and present the new department in clear and concrete terms taking the high-level agenda down to the next level. In this respect, the existing internal communication infrastructure (which includes regular SES forums and the use of multiple electronic channels) represents a major asset that has been developed over time and can be leveraged to provide meaningful communication to staff.
A focus on leadership and teamwork
The Executive leadership group is fortunate to be working with highly motivated staff.
DHS employees continue to record high levels of workplace engagement in staff surveys. For example, 93 per cent of respondents in the 2012 People Survey agreed with the statement 'when required, I am willing to put in the extra effort to get a task or project completed'. Similarly, regarding loyalty and commitment, 81 per cent of respondents agreed with the statement 'I am proud to be a member of my team'. These figures are little changed from the 2011 portfolio survey conducted before integration.
Further, DHS enjoys very high levels of staff tenure (average staff tenure for ongoing employees is around 10 years) and separation rates on a par with the APS generally (around 7 per cent for employee-initiated and organisational separations in 2011–12).
However, staff satisfaction with the Executive leadership group as a 'team' is mixed at best. Overall satisfaction is sitting at 38 per cent. Staff are equally concerned when it comes to the leadership's communication of the goals, vision and direction of DHS , the quality of leadership, the degree to which leadership listens, and its transparency and fairness in decision-making. These concerns have been echoed in workshops and interviews at various levels across the organisation. Staff will be looking to see what actions are taken in response to the 2012 People Survey, and it is imperative that the Executive selects a core set of areas to proactively and visibly address and links any new initiatives undertaken to the survey feedback. There is a clear message that leadership needs to be more visible and communicate more effectively by creating opportunities for staff to contribute and actively listening to staff feedback and input.
Efforts by the Executive leadership group to overcome 'siloed behaviour and pockets of internal competition are genuine. Engagement through the department's eight senior governance committees is reportedly routine and efficient. Perceptions that the Executive is not working effectively as a team can be addressed by the Executive leadership group more actively demonstrating to the workforce that it can operate collaboratively. This can be best reflected in explicitly seeking out internal expertise, listening to and valuing diverse opinions, and paying as much regard to 'how' the Executive leadership group achieves results as to the results themselves. Engagement with all SES officers will be essential in this regard.
Finally, in respect of the DHS Executive it should be recognised that it is a new team brought together by circumstances and managing a delivery business of considerable size. The Executive is now at the point where it needs to demonstrate that it is a high-performing team. The team's members need to work together in a way that is characterised by high levels of mutual trust, confidence and respect, and they need to value the diversity of experience, skills and individual styles that each member brings to the team as a whole. The Executive needs to model those behaviours and that modelling needs to be visible to people at all levels of the organisation.
- 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?
Building a unified culture
Institutional culture plays a significant role in binding an organisation together, and all SES officers have dedicated time and energy to organisational cohesion during the integration process. In doing so, they have rightly been building on the strong pre-existing cultures of service and 'can-do' attitudes that characterised the predecessor agencies.
More dedicated effort is required on the culture front going forward. The time is now right to explicitly elaborate a set of model behaviours that define what is expected of all DHS staff, and empower people to identify and 'call' both good and bad conduct.
The early decision to adopt the current APS values (noting that at the time of writing the Public Service Amendment Bill 2012 which is before the Parliament, proposes new APS values) as a key part of the DHS cultural mix was an appropriate choice. However, to make sense to staff, the values need to be more fully operationalised. For example, while it may be easy for a Service Centre Manager to understand the importance of 'deliver[ing] services fairly, effectively, impartially and courteously' (Public Service Act, Section 10), what does it mean for the same manager to be 'openly accountable for [their] actions ... to the Government, the Parliament and the Australian public'?
Work will need to be done to make values relevant and concrete for staff.
This can best be done through a focus on behaviours, and the review team suggests that all SES officers adopt a more structured process to build a new culture that includes defining the behaviours required to deliver the departmental mission, communicating and modelling those behaviours, reinforcing those behaviours at every opportunity, and aligning the organisational infrastructure to those behaviours.
Leveraging current positive behaviours
Beyond behaviours that correspond with the APS values, there are likely to be other behaviours that the SES deems important to promote.
Collaboration in policy and program development would appear to be one of these, and has already found voice in the Strategic Plan 2012–16 (pages 10–11). Other possible candidates raised in the conduct of the review included increased appreciation of workplace innovation, dedication to a unified DHS , and commitment to professionalism and excellence as public servants.
The department itself will need to consider which behaviours are most applicable to meeting its vision. In the front line of DHS , there is a strong sense of which behaviours lead to positive customer outcomes. The starting point should be to ask 'When DHS is at its best (e.g. at times of national emergency), what characteristics does it display, and what additional behaviours does it need to demonstrate?'
Whatever the final list, these behaviours will need to have buy-in from a broad cross-section of the department, and thought will need to be given to how they are developed and socialised. In this context, the review team understands that a considerable body of internal preparatory work has already been conducted, but would counsel against a purely top-down process for the refinement of the list.
Overall, feedback from multiple quarters suggests that the time is right, one year on from integration, for the Executive to tackle a number of other critical motivational issues directly. For example, the department can look to utilise its performance management systems more fully to develop a high-performing workforce. Creating an environment in which constructive feedback is actively sought and provided would ultimately benefit all parties. Similarly, there should be less fear of causing offence when stating preferences or advocating approaches that were borne of particular master programs where based upon sound reasoning.
- 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?
Preparing for a new way of working
The Executive is managing an ambitious agenda of workforce restructuring and upgrading, with implications for virtually every area in the department.
As previously outlined, the ultimate purpose of the agenda is to transform the way DHS does business: most transactional services are to be automated, with the aspiration that the bulk of routine entitlements will be settled through self-service (typically online) customer solutions. Customers who still need to engage with the department face to face are likely to be those customers who need more intense interaction and will increasingly receive a greater level of tailored, 'wrap around' support from more specialist DHS providers.
The magnitude of change being contemplated has few parallels elsewhere in the APS, and the human resources planning work conducted to date, including the Strategic Workforce Plan 2011–2015, is highly commendable and places the department on a good footing to take its next steps.
The current workforce headcount stands at almost 37,000, around 25 per cent of the entire APS. According to the Workforce Plan, demand for staff, based on current activities and all other things being equal, is projected to decline by 10 per cent to 13 per cent by 2014–15. Meanwhile, the shape of the DHS workforce will be substantially reconfigured, with reduced staff numbers at all levels, but particularly at the lower levels, as less complex work is transferred to automated channels. Those staff reductions and organisational reshaping should be able to be achieved using natural attrition and redeployment, but clear transition paths, informed by a service design map, will be required.
The challenges to executing this transition are formidable, but the Executive recognises most of the issues.
Key challenges include finding sufficient time and resources to take staff offline to allow them to participate in necessary training and development opportunities; and finding suitably skilled and qualified candidates, either internally or externally, for the new customer service and policy officer roles expected to see increased demand. This must be done whilst maintaining a workforce that is broadly reflective of the communities it serves.
Most importantly, the move forward will be contingent on the settled service design map, which should give 'colour' and life to these people transformation efforts, which may need to be dynamic during the transition period.
Pursuing improved day-to-day management
The review team believes that some of the more operational aspects of DHS human resources management could benefit from increased attention, given success in these areas is a precondition for broader strategic success.
Perhaps more so than other agencies, DHS cannot permit underperformance in critical pockets of the organisation, and the persistently high levels of unscheduled leave (an average of 14 days per person per year) point to a problem that the department is addressing and must resolve.
The review team has received feedback that the department could be better at 'early intervention' to deal with underperformance issues, the implication being that problems are addressed only once negative impacts on individual and team output have become obvious or overwhelming. Demonstrating a willingness not to let performance problems go unchecked should be a priority for everyone in DHS leadership roles, both the SES and Executive Level (EL) cohorts. Strengthening performance management capability will require intensive training and reinforcement by the SES officers, individually and collectively, and modelling through their behaviours.
Further, learning and development (L&D) work arguably needs to be more targeted to the change agenda. While the department has undergone a significant rationalisation of training programs since integration, current L&D spend appears low and staff have expressed some dissatisfaction with the available offerings, noting a disconnect between the theory discussed in formal instruction and on-the-job practice. The 2011 State of the Service Report similarly pointed to dissatisfaction in this area.
Some L&D strategy work was undertaken by the department in mid-2011. This work attempts to prioritise the department's learning and development objectives, and to cascade these priorities (at varying levels of detail) down the organisation. The review team believes that the department's formal adoption and resourcing of a strategy of this nature would be beneficial.
Finally, talent management work to date has focused on the SES and integration has created new opportunities to expand the horizons of this cohort (of particular interest, interlocutors noted favourably a small increase in exchanges of senior personnel between the DHS and central agencies). However, there needs to be an explicit strategy for development of talent below the SES / EL 2 cohort as well. Given the potential impacts from the planned restructuring of the DHS workforce, dedicated career management and support should be a priority in and around this staff cohort.
4.2 Strategy summary
- The department has articulated its vision for the future of service delivery. The critical next step is to develop a detailed service map. This will give staff a clear picture of how they can actively work towards the vision.
- A detailed service map will also facilitate further planning within the department and give staff on the front line a practical appreciation of where they are heading, their role in the new model of operation, and how they will collectively move to it.
- DHS needs to move from a transactional view of the customer to a holistic view. In the Network, zone leaders have a rounded perspective that is driven by their day-to-day contact with customers and this needs to be factored into the service design map.
- The organisation needs to further develop and leverage its extensive data holdings to build its strategic intelligence.
Collaborate and build common purpose
- DHS has the potential to see the whole individual, family or community. This perspective means that it can contribute to better policy outcomes for government and customers.
- To earn its place at the policy table, DHS needs to strengthen its policy capability and consistently demonstrate to partner agencies and government that it can add value.
- ICT plays a pivotal role in DHS service delivery and in the change agenda. Going forward, it is important that business areas step up to the role of driving ICT changes. As business steps up to this role, governance arrangements should evolve to reflect the new ICT arrangements.
- The department has developed an 'evolve to replace' strategy for its legacy systems to ensure that it is able to deliver for government and the community into the future. This now needs to be coupled with a strategy to engage, educate and secure the support of government and other parties.
- The ways in which DHS engages with stakeholders vary. The department can improve on the consistency and quality of its stakeholder engagement by leveraging off the good practice that happens in the department and implementing a regular stakeholder survey.
Comments and ratings against the components of the 'strategy' dimension follow.
- 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?
Developing a service design map
It is important to distinguish between the 'setting' of an organisational vision and a strategy that can 'deliver' on that vision. The Strategic Plan 2012–16 explicitly articulates DHS 's vision for the future of the department. This is a valuable piece of communication within the department and the next step should be to develop a service design map and an implementation pathway for the delivery of the strategic vision. While staff have embraced the vision, they have yet to see it translated into a clear picture of what the future looks like, or to understand how their roles will change.
This has been consistent in feedback from staff. For example, in the December 2010 Staff as Customers consultations, many participants had the view that SDR would impact more on the organisation than on them as individuals, and many felt that their jobs would remain largely the same regardless of what happened organisationally.
More recently, in the 2012 People Survey, only 52 per cent of participants agreed that they were kept informed on how the delivery reform agenda would impact on their work. Staff also spoke to the review team of the different customer bases of the master programs and their concern over how a co-location strategy would work on the ground. For staff this uncertainty can create a sense of there being 'light on the hill and fog in the valley'.
The review team noted that the Strategic Plan 2012–16 points to four complementary strategies that focus on specific areas in greater detail. They are the Operating Model, Portfolio People Strategy, Internal Budget and the ICT Strategic Plan. While the Operating Model provides some additional detail around the vision of the future, its generic and high-level nature means that it is not an adequate substitute for the service design map.
A service design map should provide a vivid description of what the future looks like, detailing everything from job roles and office layout, to what the IT system looks like. Doing so will give staff something to hold on to and a clear understanding of where they, as well as the organisation, are heading.
Further, the framework described in the Strategic Plan 2012-16 places the Operating Model on the same level as the People Strategy, Internal Budget and ICT Strategic Plan. A well-constructed and articulated service design map would drive workforce planning, ICT and internal budgeting and, in fact, should prove to be an integrating force for this planning.
The absence of a service design map, as well as making it difficult for staff to engage meaningfully in reforms, also creates the risk that management choices and resource allocation are not optimal. The establishment of a clearly articulated and widely understood process for managing all the change in the organisation would allow for the transparent allocation of resources against organisational priorities. This would also facilitate strategic decision-making about what the department stops resourcing.
In summary, the review team is of the view that, in the absence of the service design map, a critical piece of the puzzle is effectively missing and much that DHS wants to achieve is being stifled. As a consequence, the department will increasingly struggle to fulfil its change agenda and realise the benefits, financial and otherwise, that are fundamental to its future long-term viability.
- 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?
Placing the customer at the centre
Traditionally, DHS has had a 'transactional' view of customers; that is, customers are understood by the transactions they have with the department, in the main what master program they are accessing and what income support payment they receive. However, customers need to be placed firmly at the centre of service design and viewed holistically, not simply through the prism of existing transactions.
DHS customers are as varied as the Australian population itself, with large differences across and between the service zones based on age, location, linguistic and cultural background, socioeconomic status, work skills, familial circumstances and personal security. At one and the same time a Service Centre may be helping a pregnant mother making a Medicare claim, dealing with a homeless and disaffected benefit recipient seeking a crisis payment, registering a student for income support or serving a migrant from a non-English speaking background who is starting to look for employment.
The review team's investigations have shown that the comprehensive, holistic understanding of the customer base is most evident and accessible through the Network, although building the complete picture needs to be appropriately considerate of established privacy provisions.
Zone managers have a view of their customers that goes beyond the transactional character of the DHS services they provide—in effect, they 'own' their customers. Because of this, Zone leaders can clearly describe the dominant characteristics of their principal customer cohorts, whether aged, young, from a non-English speaking background, poorly educated or facing multiple disadvantages. This was confirmed by review team site visits to Bankstown, Campsie, Sunshine, Broadmeadows, Batemans Bay, Fortitude Valley and CSP Operations, Melbourne.
However, because this understanding is informed by front-line engagement with customers over time, it does not easily aggregate into a common DHS perspective. While many people in the organisation spoke of the depth of information that DHS holds on customers, at a national level there is a lack of focus on customer segmentation and the development of holistic customer profiles.
Customer segmentation, based on input from the Network, should not only inform the service design map, but also subsequently guide workforce and ICT planning efforts. Greater appreciation of the Network's perspective should also translate into a sense of 'ownership' at national office level and ensure that the department fully realises the relative advantage it has when it comes to serving the community.
Translating data into strategic information
In 2011, DHS commissioned advice on strategic information management arrangements in the department. The advice was that 'Strategic information management is not a well defined or integrated function across the department. The department's information capabilities are currently focussed on the collection and storage of transactional data and the production of operational and workload related information for senior management ... There are pockets of strategic research and analytical capability ... though these resources have not traditionally been applied to strategic business intelligence ...'
Several stakeholders referenced the extensive information that DHS holds, and the inherent value of that data. This was echoed in the advice: ' DHS has access to an unparalleled data base on the health and social well-being of the Australian population and on emerging needs across Australia.'
This data, subject to privacy requirements, can be marshalled to inform the development of forward-looking evidenced-based policy advice and service delivery reform. However, as the advice noted, this will require a stronger focus on strategic information management and the development of appropriate institutional support.
As the department pursues this agenda, it will be critical that it is driven by an explicit information management strategy, and that one member of the Executive has responsibility for that strategy. Developing the analytical capability within the department may require targeted recruitment, staff development, and identification and coordination of existing staff with those skills who may be operating in pockets within the department.
Leveraging the strength of the Network
The Network includes face-to-face services, smart centres (call and processing) and self-managed services. The Network contains a wealth of knowledge and operational intelligence, broader than their knowledge of the customer base, which the department could better capitalise on.
Indeed, as the organisation moves to fulfil the role of a department of state with a seat at the policy table, there is a risk that the organisation will become too 'Canberra-centric', with a disconnect between the front line and those in the policy and program areas of the department.
In addition to their intimate knowledge of the customer base, staff in the network can provide insights into programs and policy design. As previously stated, the knowledge and power of the Network represents a 'comparative advantage' for the department and establishing a framework to harness that knowledge, or at a minimum strengthening feedback loops, will enable the department to utilise that strength to improve service delivery, influence policy and plan for the future.
Collaborate and build common purpose
- 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?
Developing a policy capability
DHS is in the unique position, both within government and outside government, of seeing the whole individual, family and community and the impacts of policy on the ground. This integrated view can contribute to better policy outcomes.
Feedback about the extent of DHS involvement in policy development was variable, and a single joined-up process where DHS can contribute appropriately and work in partnership with policy agencies would allow the full benefits to citizens and government to be realised.
The Executive is aware of the potential for DHS to contribute to policy development where it has something of value to offer, and has gone some way to building the capability of the department in that sphere, including through actively recruiting policy skills. However, overall, the policy capability of the department is patchy and not well harnessed. As the Strategic Workforce Plan 2011–2015 notes: 'Currently there are experienced shortfalls in policy development and delivery, and in program design. Therefore the department needs to equip employees with policy capabilities through targeted recruitment and developmental opportunities.'
DHS needs to consistently demonstrate that it can contribute to achieving better outcomes through its participation in the policy development process. Continuing to strengthen the policy capability of the department, and using the data resources referred to in the section above, will enable DHS to fulfil this role.
Business taking the lead on ICT
ICT has played a pivotal role in the DHS change agenda. All ICT decisions are approved by the ICT governance board and the DHS Executive. However, this does not appear to be understood by the business or communicated effectively and, because of this, in some ways ICT is perceived as moving in front of business. The review team considers it appropriate for all levels of the business to step up to drive further ICT changes and development.
A practical manifestation of the consequences of such a discord is that the customer service transformation and push to online servicing being pursued by the department has to date failed to properly cater for those cohorts (such as non-English speakers) who cannot easily take up automated self-service options (e.g. where they are structured on systems limited to a single language). This is despite the fact that, according to census data, a significant proportion of the likely DHS customer base lacks competence in English but is technology literate. In addition to improving customer satisfaction this capability will also reduce operating costs for DHS .
Given the relative newness of the integrated organisation, the importance of ICT to the delivery of its mission and the need to continue work already begun on realigning the ICT –business relationship, the Secretary may wish to consider whether there is advantage in her taking the chair of the ICT governance board for a period of time.
Creating a service design map (as discussed above) will support business to step up to this role and bring about better coordination between business and ICT . This coordination will also be facilitated by further developing ICT governance arrangements that ensure all requests are considered together and assessed against consistent criteria (e.g. benefits realisation, budget), with priorities set and understood by ICT and business areas.
Future-proofing ICT capability
'Getting to go' for ICT as part of integration has meant bringing legacy systems together as one integrated system onto sustainable platforms, within a standard architecture and a common suite of applications. Staff spoke to the review team of an ICT system that is reliable and stable, but which is increasingly costly and time consuming to adapt to implement government decisions and maintain. To be able to continue to deliver for government and partner agencies, the department has developed a strategy of 'evolve to replace' for the legacy systems.
This is an appropriate approach for the department to take given the criticality of the system and the severity of the consequences if the system were to fail in the future. However, while the review team considers that the approach is appropriate, it is imperative that DHS starts to build a common understanding with central agencies, partner agencies and government generally of the need for change. Moreover, the 'evolve to replace' strategy requires a genuine multi-year sustainable funding pathway that is supported by a broad-based consensus amongst relevant parties, not least governments across current and future terms. To achieve this DHS leadership needs to start the dialogue as a matter of priority.
Strategically managing stakeholders
DHS operates in a complex stakeholder environment. Many stakeholders spoke about the quality of the service that DHS provides to the community and of its focus on customer service. However, for community organisations representing sections of the population, there was a sense that DHS had a tendency to provide information in the guise of consultation, and therefore that the promises of co-design had not yet been realised.
Some stakeholders also spoke to the strength in DHS delivery not being matched by strong business governance, with stakeholders having multiple, and at times changing, contacts within the organisation. A stakeholder management strategy which segments stakeholders and establishes associated appropriate arrangements will build on the already good relationships that DHS has established and improve the consistency of the engagement. The responsibility for the stakeholder engagement strategy should be anchored at a particular point in the organisation. Further, the review team considers that, for an organisation operating in a stakeholder environment of this nature, it would be appropriate for DHS to conduct a regular independent stakeholder survey, including client organisations.
4.3 Delivery summary
- The DHS Network is innovative, and driven by the desire to make people's lives better and the pressure to become more efficient. This innovation in the Network will benefit from the formal framework and guidelines which the department has indicated it will introduce.
- Innovation within the department would also be fostered by the establishment of a service design map to guide innovative efforts and a greater tolerance for mistakes, which are a natural part of the trial and error process of innovation.
Plan, resource and prioritise
- Given the extensive amount of change that is happening in the organisation, the department should establish an enterprise-wide change control mechanism that ensures that all change is sequenced and managed against departmental resources.
- During the initial integration of the department it was natural and appropriate that some decision-making was centralised and elevated within the department. Given the stage that integration is now at, it is appropriate to review that process and seek to devolve functions where appropriate.
- Positive steps have started to be taken by the department in relation to risk management. The risk-management approach can be further strengthened by a broader understanding of reputational and political risks and a culture that encourages proper escalation of risk and strengthening of the assurance framework.
Shared commitment and sound delivery models
- The department consistently delivers on an extraordinary range of activities, to the satisfaction of customers, the community and government.
- The department is trialling positive new models of service delivery based on good practice, which position the department well for the future.
- The department has a strong record of monitoring and managing its operations and commissioning reviews around operational and business performance.
- This approach needs to move towards an outcomes-focused model of managing performance.
Comments and ratings against the components of the 'delivery' dimension follow.
- 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?
Harnessing internal innovation
The department currently does not have an innovation framework or a coordinated approach to supporting innovation and it is perhaps understandable, given the nature and scale of the services it provides, that the department has a fairly risk-averse culture.
In the Strategic Plan 2012–16 the department has demonstrated an awareness of the issue by stating that it will introduce a support framework and guidelines to encourage and embrace innovation in service delivery as one of its outcomes. The review team agrees that a formal framework and guidelines would help create a culture that acknowledges the trial and error of the innovation process. Equally, the introduction of a service design map will provide a focus for innovative ideas and efforts.
Formal processes notwithstanding, there is evidence of significant innovation occurring. For instance, innovations within the Network (some of which have rolled out nationally) have created major efficiencies in work flows, to the benefit of customers. For example, the Customer Liaison Officer (CLO) role was borne out of necessity in one split-level office. Wireless technology was introduced to enable the CLO to communicate to staff in the back office or on both levels of the office, resulting in quicker resolution of customers' needs. The success of the model is evident in its broader adoption across the DHS Network and the department is open to trialling new approaches and systems through study within its 'concept labs'.
Regardless, It seems that much innovation happens 'under the radar' in the regions and that the closer the staff is to the customer the greater the level of innovation, which is driven either by cost or by the desire to make people's lives better. Although the CLO role is one example of a positive innovation that has been recognised and held up by the DHS Executive, feedback from staff is that, in order to foster local innovative action, they would benefit from greater support in progressing their ideas and an organisational culture of greater tolerance for mistakes. They also suggested that the spread of innovative practices across the department is difficult due to the disjointed nature of the organisation and the absence of a clear service design map against which to measure the worth of innovations. Specifically workshop participants noted that while a lot of innovation is underway in the Network and other areas it may at times be misdirected and prove neither sustainable nor desirable. The generation of innovative ideas at the local level must be encouraged, within a framework of sharing best practice and meeting existing government requirements.
Plan, resource and prioritise
- 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?
Introducing an enterprise wide change control mechanism
The department's documented governance arrangements accord with good practice and, as a result, the department is well positioned relative to other agencies. However, the situation of DHS is complicated by the particular demands of integration and the significant amount of change occurring simultaneously with critical, uninterruptable business as usual demands.
There are many excellent examples of change managed effectively by the leadership team. The negotiation of a unified DHS enterprise agreement, the roll-out of the SAP system for all DHS employees, the integration of disparate financial management systems, and the streamlining of budget and business planning processes are all significant leadership achievements.
Nevertheless, the review team feels that the existing arrangements, while effective within their individual streams, are currently lacking an enterprise-wide perspective that brings together all change at a high level to ensure that work efforts and resources are aligned, sequenced and managed against the capacity of the department. This is important given the criticality of successful change to benefits realisation and the early evidence of change fatigue among lower level staff. Staff will have a deeper commitment to change if the reason behind it is clearly communicated.
Broadening input to management processes
Indirectly related to the challenge of change coordination, it was evident to the team during the review that many current management processes are highly directive and are determined from the top-down, which creates an issue of EL staff having limited visibility of planning and how trade-offs between priority outcomes are being made. Furthermore, feedback from EL staff indicates that although there is line of sight between the division and branch plans they are largely dictated and developed in isolation from other areas of the department, resulting in missing interdependencies. In some cases plans are not truly reflective of business as usual or on-the-ground resourcing. This likely contributes to the feelings of staff, expressed in the staff survey that they do not feel valued through opportunities to contribute and be listened to. The EL cohort also reflected this to the review team, as a feeling of being disempowered and removed from decision-making.
The review team suggests that, while it was necessary and appropriate to escalate and centralise these processes during the initial stages of integration, over time the process may benefit from the greater involvement of EL staff and the devolution of functions where it is appropriate to keep a 'looser grip' as opposed to a tight one.
Identifying and mitigating risks
A recent risk review of Australian business, conducted by KPMG, established that Australian businesses are underestimating the security risks posed by the increased use of consumer technology devices and downplaying their own IT security problems to avoid public relations disasters. Given the size of DHS 's business, the department is not immune from this risk and must continue to create a dynamic risk and assurance framework, building on the progress it has already made.
The department has made positive steps in identifying a common set of strategic risks. The review team encourages the Executive Committee to continue its practice of having scheduled quarterly discussions of strategic risks and regular consideration of top operational risks, and intervening where required. Given the stage that DHS is now at, the time is right for the department to clearly define its risk appetite and to communicate this throughout the organisation.
Clearly articulating the department's risk appetite will enable staff at all levels to identify and manage risk more appropriately. The identification of potential risks could be further enhanced by introducing clearer processes below the DHS Executive for bringing potential risks to attention outside the formal Division, Branch and Service Zone business processes and actively encouraging staff to do so.
Moreover, the identified strategic risks appear quite generic and are not couched in the day-to-day realities of the department. There have also been some indications that risk management activity is often crowded out by competing priorities.
At this point in the department's evolution, the review team believes there is merit in a senior executive conversation aimed at identifying the real 'game changers' for the organisation. These are the handful of risk factors that warrant close management. Deeper discussion of these issues at a senior level is warranted given that the organisation is about to head into another period of accelerated change driven by the financial demands of benefits realisation. The department should also develop a stronger assurance framework, given the quantum of funding and the breadth of business it is responsible for.
Matters would also be improved by a broader understanding within the department of political and reputational sensitivities and risks. A culture that encourages the appropriate escalation of risk will assist in creating a risk-aware, as opposed to risk-averse, business. In this respect, the review team is particularly concerned that customer-facing staff are building up a resistance to identifying and reporting risks such as customer aggression, which, anecdotal evidence suggests, may be under-reported by staff.
Shared commitment and sound delivery models
- 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?
As much as the department is held in high regard by the public, the extraordinary scope of the work that DHS does is often not well recognised within the APS and throughout the broader community. Yet the department delivers on a consistent basis an extraordinary range of payments, services and activities, and any breakdown in this regard would soon manifest itself in social disruption. This is generally done out in the Network by relatively junior staff who occupy leadership roles in regional offices.
Furthermore, as previously noted, the department possesses a significant crisis response capability which has been particularly evident over the last few years, and deserves acknowledgment. Indeed, staff through interviews and workshops noted with pride their performance at such times, and this was matched by the comments of many external stakeholders.
Customer metrics, while they can be more outcomes-focused, nevertheless provide good data on service satisfaction levels and the department's relationships with its partner agencies are well defined and documented through various memoranda of understanding and service level agreements.
The department is also taking its first steps towards the adoption of new co-creation/co-design methodologies in a logical and positive fashion.
Acknowledging progressive steps
DHS is also trialling positive new modes of service delivery (e.g. Local Connections to Work; Case Coordination; and the 'BayLink' service centre model in Batemans Bay, New South Wales—a one-stop shop for state, federal and community services). Those approaches are based on good practice principles and are in line with the vision for the department.
Indeed, Organization of Economic Cooperation and Development best practice generally supports the integration of employment services and welfare support, and the department is working to test ways to better connect services to customers with diverse needs.
In light of the strong impression the current trials have made on the review team, it is considered important to provide readers with a sense of their impact by reproducing just two customer case-study experiences below.
Mary* presented to a DHS office and asked if 'Centrelink' provided travel vouchers and, if not, could she be advanced $20 from her next payment. Upon further exploration of her needs, it was identified that she was in the process of fleeing from her partner due to domestic violence. She was offered the opportunity to receive some more support and was referred to the Case Coordination team.
When Mary was referred to Case Coordination, a Customer Service Advisor and Social Worker worked together to assist Mary. Mary was given additional professional support and counselling by the social worker to help her deal with the grief, loss and trauma she had experienced during the course of her relationship. Mary, the Case Coordination Customer Service Advisor and Social Worker worked together to establish a plan to achieve her goal of safety. Mary's key strengths of resilience and courage, as she took steps to be safe, were identified and included in the case plan.
The Social Worker was able to grant a crisis payment to ensure that Mary's relocation did not result in further financial hardship. The Case Coordination team worked with Mary's probation and parole case worker on changes to her probation conditions, including an amendment of the address she was required to reside at. The Case Coordination team was able to advocate for a police escort for Mary to her sister's home to minimise the risk of an incident on public transport. The police were also able to enact an interim apprehended violence order, and assist Mary with the process of making a statement. Mary was provided with referral options to pursue counselling and support once she was settled in her new area. The case worker also advised that once Mary was transferred to the probation and parole office in her new location, the case worker would work with her colleague to ensure that Mary was linked with support as part of their ongoing case plan.
Local connections to work
George* came into a DHS office. He was 27 years old, unemployed and at risk of homelessness. He had some substance abuse and anger issues and was likely to go to prison. He knew he needed help, but didn't really know where to start.
The Customer Service Advisor, Karin*, first found that George was entitled to the Newstart Allowance. While registering the claim she asked George if he had thought about asking his mother whether he could stay with her. While the Customer Service Advisor was photocopying some papers, George called his mother. Although they hadn't spoken for ages, his mum said yes. After Karin finished off the Newstart claim and booked George into a Job Capacity Assessment, they had a conversation about what to do next.
George agreed to speak to a counsellor about his drug and anger issues, so Karin walked over to set it up on the spot. When George had finished with the counsellor they went over to talk to the Local Connections to Work partner operating at the site to talk through some study options. George decided he could commit to a program that would lead to a range of vocational qualifications.
George had money to go on with, a place to stay and a support network, had committed to improving his skills, and, most importantly, had a new sense of hope. As Karin said later 'We were able to deliver a full complement of supports and services to a person in crisis and, best of all, I saw the outcome. This has personally given me such a sense of accomplishment.'
*Not his/her real name.
- 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?
Driving the shift to an outcomes paradigm
Maintaining the department's performance record is dependent on sustaining strength in delivery across an expanding range of services.
Because of the size and volume of the organisation's operations, even 1 per cent non-aligned performance means that there is a big problem. Thankfully DHS has a strong record and experience in delivering payments and other services to a consistently high standard and is relied on by government to continue doing this. Typically master program performance is measured daily, weekly and monthly against customer satisfaction, complaint levels, response times and volumes.
The department is also proactive in commissioning reviews around operational and business performance, indicating a commendable level of interest and awareness in always driving for excellence and improving business operations further.
This is matched by increased attention on the part of the Secretary to the appropriate use of internal audit capacity and proper financial oversight, including the development of the new funding model. The review team favourably notes the recent structural changes that have brought these functions under the Secretary's direct control.
Having said this, there are some opportunities to refine and retune, with the future firmly in mind.
For example, organisational performance management remains driven in many areas of the department by transactional metrics that are not well aligned to outcomes-focused reform objectives. For example, key performance indicators in business plans and the 2012–13 Portfolio Budget Statements are not consistently SMART (i.e. specific, measurable, attainable, realistic and timeframed)—some are specific, some very general. The review team has also heard that some of these metrics are set externally and involve cross-agency agreements that add to the complexity in shifting the basis of operational performance management in the department.
The systems and infrastructure supporting the transactional paradigm—and associated reporting—will be increasingly out of step with the vision that is articulated in the Strategic Plan 2012-16. Traditional performance management is already causing problems for teams operating in more outcomes-focussed modes of service delivery.
The review team suggests that an increased focus on measuring outcomes for citizens and evaluation more broadly across the department (beyond delivery–service metrics such as call waiting times) would be useful in conducting the various trials referred to above, and would assist the department in influencing future delivery policy and making a case for expansion of these approaches.