The Performance System of Government Agencies in Indonesia: Performance Management or Measurement?

Transcription

1 The Performance System of Government Agencies in Indonesia: Performance Management or Measurement? Fahdiansyah Putra1 and Bhekti Arum Lestari2 1, 2 Program of Adminitration and Public Policy, Faculty of Administration Studies, University Indonesia, Indonesia 1 fahdiansyah.putra@gmail.com, 2 bhekti.arumlestari@gmail.com Abstract Performance management tends to be biased toward the performance measurement especially on the implementation level. Although some theories and experts clearly explain the differences between both of them, there are some governments who still misunderstand. One of the governments is Indonesia who is undergoing the bureaucratic reformation. This article endeavors to scrutinize the implementation of performance management of Indonesian government through literature review as a base for comparing the theories with the reality. From various experts criticisms on the definition difference between performance management and measurement also the management model based on the performance, it can be seen that there are numerous performance indicators which are inter-related in a performance management system. The system is then set to be thoroughly discussed in this article in order to find out whether Indonesia implements the performance management or only executes the performance measurement. Keywords: performance system, Indonesian government, performance management, performance measurement 15

2 I. INTRODUCTION Performance measurement is not a new thing in management. There is a belief that this has been done since Wei Dynasty in China. There is also another statement arguing that the performance measurement was begun formally by American troops in World War I which was known as man to man rating system for evaluating military personnel (Oberg, 1972). After that, this concept was adopted by the other government agencies. The performance measurement has attracted some criticisms from experts, so that an idea about performance management appears. Some experts ideas on the definition of the performance measurement and management are shown in the table below. Table-1. of Performance Measurement and Management Performance Measurement Lebas, M.J. measures (1995), based on key success Performance factors, measures for Measurement detection of and Performance deviations, measures to track past International achievements, Journal of Production measures to describe Economics the status potential, measures of output, measures of input, etc Neely Andy, quantifying the Chris Adams & Mike efficiency and Kennerley, (2002), effectiveness of past The Performance actions using Prism, The Scorecard appropriate for Measuring and information Managing Business infrastructure Success, Financial Times Prentice Hall an imprint of Pearson Education Poister, H.T. (2010), accountability and The Futurre of the symbolic value Strategic Planning in of requiring agencies the Public Sector: to report on their Linking Strategic performance Management Performance Management Scort Snell & the process of George Bohlander creating a work (2007), Human environment in Resource which people can perform to the best Thomson South of their abilities Western Michael Armstrong (2006), Human Resource Management Practice, Kogan Page Ltd. Landon and Philadelphia a systematic process for improving organizational performance by developing the performance of individuals and teams L.M. Prasad (2006), Human Resource Sultan Chand & Sons: Educational Publishers the process of planning performance, appraising performance, giving its feedback, and counselling an employee to improve 16

3 Performance Measurement and Performance, Public Administration Review Toppo, L. & Prusty, a systematic Twinkle (2012), evaluation of the From Performance individual with Appraisal to regard to his or her Performance performance on the job and his potential Journal of Business for and Management development Gary Deessler (2008), Human Resource Pearson Education evaluating an employee s current and /or past performance relative to his/her performance standards Performance Measurement his performance Denisi, Angelo S. & Pritchard, R.D. (2006), Performance Appraisal, Performance Management and Improving Individual Performance: A Motivational Framework, Management and Organization Review Fletcher, C. (1993), Appraisal: Routes to Improved Performance, London: Institute of Personnel and Development a broad set of activities aimed at improving employee performance an approach to creating a shared vision of the purpose and aims of the organisation, helping each employee understand and recognize their part in contributing to them, and, in so doing, manage and enhance the performance of both individuals and the organisation Peters and Pierre s ideas in a writing entitled Governance Without Government? Rethinking Public Administration (1998) and Governance, Accountability and Democratic Legitimacy (2006) explain that the capacity of government s policies frequently cannot go with the dynamics of either social or economic changes. Therefore, citizens judge the government to be slow in responding the changes. The more extreme judgment is that the government is thought not to be able to fulfill the citizens needs. Governments around the world, especially Indonesia, must keep working to be more responsive and accountable in order to fulfill their people s needs. The instruments of public management which are implemented in developed countries and are promoted by international donors are adopted such as governance and performance management. In Indonesia, performance management is a requirement of remuneration offer toward government agencies. Thus, it can be predicted that the implementation of Indonesian 17

4 government s performance management is only a formality. In other words, the performance management implementation is done only for fulfilling the requirement of remuneration. This is also done not harmoniously with the vision and mission as a government: fulfilling the citizens needs. Consequently, Indonesian government s perspective needs to be called into question: are they really implementing performance management or only performance measurement? II. METHODS This research is literature review in nature. This kind of method is meant as reviewing theories, definitions, or findings from the previous researches which are relevant with the research topic. In this article, the reviews were conducted on the literatures related to the definition of performance measurement and management. Furthermore, the reviews were also done on the policies or laws which are connected with the performance system of Indonesian government agencies. Consequently, literature review is regarded to be an independent part of this article. III. RESULTS Based on the aforementioned literature review, there is a clear-cut difference between performance measurement and management. It is all about humanistic side in human resource management. The performance measurement highly focuses on the outcome evaluation from individuals. On the contrary, performance management is wider than that. This management comprises motivation and endeavor to engage individuals in organization s visions and missions. Performance management can also be called as a strategic and integrated approach in achieving organization s goals by developing the worker s performances, the team capabilities, and the individuals contributions. As a consequence, in the process of performance management, coachings and feedback requests can be done to get improvement in the performance. Moreover, a leader s involvement is needed to give directions, to measure, and to control. The leader has also responsibility to pay attention on the performance improvement to reach the effectiveness of organization, team, and individual. This is done as performance is not only about what to reach, but also about how to reach. Source: Artley, Will DJ Ellison, and Bill Kenedy (2001) in Sangkala (2016) 18

5 As depicted by the figure above, the model or pattern of the performance-based management by Artley, Will, DJ Ellison, and Bill Kennedy (2001) shows six stages that should be followed. The first stage is strategic planning phase. This is about determining the missions and goals of strategic performance. This stage by then will be guideline for all the organization s members in making decisions, developing procedures, and determining how the success is measured. The next stage is determining the integrated performance measurement system. After the mission determination, the next stage is important to decide which system is suitable for measuring the integrated performance by keep considering the missions and goals of the organization. But, there should be remembered that it is important to know who the organization s customers are, so that the system can run effectively. Furthermore, the next stage shown by the figure is determining the accountability of performance. The success of performance measurement system might be gained when there is a relation between organization s strategies and performance measurement. The integrated performance measurement can be an effective way for a change. The measurement is not merely concentrated on comparing the data which are measured by the target, but also on finding the actions needed. The term of accountability in the book of Dimensi-Dimensi Manajemen Publik (Sangkala, 2016) is defined as responsibility owned by individual, team, or organization that is assumed to exert the authority and/ or to carry the responsibility. Then, the fourth stage is determining the process/ system of data collection for performance evaluation. Finding the data which are objective is very important, since objectivity highly determines the output, outcome, and also improves the performance continuously. Therefore, the determination of the process/ system of the data collection must be carefully considered. The next step is determining the process/ system in order to analyze, review, and report the performance data. This level might be said as the most crucial one, because the results will be the important information to be developed for answering questions like why and how something happens and what actions should be taken. The last stage of the performance-based management is determining the process/ system of performance information use to improve the performance. This is the continuation in an integrated system where analysis results written in a report can be used to improve the performance so that the organization s goals can be achieved. Related to the performance management, there is Presidential Regulation Number 81 of 2010 on Grand Design of Bureaucratic Reformation in The regulation constitutes the policy s directions of the bureaucratic reformation in Indonesia. The presidential regulation, which strengthens the performance management system, becomes one of the instruments in supporting the bureaucratic reformation. However, before the regulation was made, Indonesia also had a law related to the implementation of performance management system: Presidential Instruction Number 7 of 1999 about The Accountability System of Government Agency s Performance. In 2014, the Presidential Regulation Number 29 of 2014 about The Accountability System of Government Agency s Performance was launched to strengthen the law foundation regarding performance management system. Based on the regulation, each government agency must run The Accountability System of Government Agency s Performance (SAKIP). This is done to build a system of performance management which can be connected with the remuneration system. 19

6 The Accountability System of Government Agency s Performance in Indonesia The performance management in the grand design of bureaucratic reformation comes within the second change area which is related to governance. In Indonesia, the performance management of the government agency stole the limelight in the bureaucratic reformation era. This even must be a target to reach. Unfortunately, the aforementioned concept had not been transcribed yet in a government regulation until now. The worse, it becomes distorted due to the competence lack of the state apparatus in understanding the performance management. As a result, the performance accountability system, which initially was a systemic instrument in performance management, is just focused on the measurement. On the level of performance management implementation, the state apparatus only focuses on the implementation of the duties and responsibilities which is written in Performance Target of Employee (SKP). The SKP is correlated with the position and grade which are used as a base for determining the remuneration for the each of the civil servants. Target and performance become the main focus. Consequently, the process that is crucial to evaluate the performance for improvement tends to be neglected. Moreover, the civil servants tend to complete the targets written in SKP without evaluating whether all of those are done effectively and optimally or not. Through that scheme, it can be seen that there is lack of the leader s role as expected in the concept of performance management. The leader s function to give directions by maximizing the coaching in order to get the better achievement seems not to be well done. In fact, some leaders of the agencies sometimes only see the report of the SKP, not thoroughly check the process on how the SKP can be achieved. This results in the lack of the attention on the development which is the most prominent in the performance management system for the performance improvement. The improvement is then impossibly reached when there is no effective process and continuous development. The next thing to discuss is about remuneration percentage. This percentage of each ministry and agency is generally based on their Accountability Report of the Government s Performance (LAKIP). Therefore, each agency will try to make the best LAKIP despite seeing how reliable LAKIP is written. The arrangement of LAKIP is also done only on the performance measurement of an agency without considering the human resources. LAKIP is only a measurement instrument based on the result, not focused also on the process. This subsequently triggers a question of how an integrated system can be built. In fact, the integration of the performance measurement is a big part which cannot be separated in a performance management concept. Accordingly, the governance will be just a formality as the performance management is merely focused on the measurement either in the ministries or agencies. The performance measurement is also done only on the documentation and numbers of the target in order to fulfill the requirement of yielding the remuneration without considering the relation between individual s performance and the organization s visions and missions. In other words, what is really implemented in Indonesia is just performance measurement, not the performance management. IV. DISCUSSION AND CONCLUSIONS Performance measurement has a clear-cut difference with performance management. It can be said that performance management is wider in the scope, where the performance measurement becomes a part of it. The performance management tries to relate the organization s visions and missions with the organization s planning, performance, measurement toward the performance, evaluation, and continuous process which is integrated in a system. On the contrary, 20

7 the performance measurement is just evaluating or scoring the performance of each duty or function. Thus, the performance measurement can be concluded as a part of a performance management system. In Indonesia, the performance management still becomes homework for the government to finish soon. The reality shows that what is implemented in Indonesia is still the performance measurement, not the management one. Therefore, it is rather difficult to talk about effectiveness and efficiency in the governance without the existence of clear performance management. The government should understand that the performance management is not only on measuring or scoring for the sake of remuneration or work incentives. The government should also consider importance of the agency s leader s role and the human resources within the performance management. The performance management also covers how to relate the indicators of performance with the organization s visions and missions, the coaching in optimizing the performance, the process feedback request, and finally the measurement as the last step. The final measurement results then should not only be gained on the evaluation level, but also on how the evaluation results are used to optimize the performance. V. REFERENCES Gary Deessler Human Resource Management. Pearson Education. Instruksi Presiden Nomor 7 Tahun 1999 tentang Sistem Akuntabilitas Kinerja Instansi Pemerintah. Lebas, M.J Performance Measurement and Performance Management. International Journal of Production Economics. Neely Andy, Chris Adams & Mike Kennerley The Performance Prism, The Scorecard for Measuring and Managing Business Success. Financial Times Prentice Hall an imprint of Pearson Education. Peraturan Presiden Nomor 81 Tahun 2010 tentang Grand Design Reformasi Birokrasi Peraturan Presiden Nomor 29 Tahun 2014 tentang Sistem Akuntabilitas Kinerja Instansi Pemerintah. Peters B. Guy dan Pierre John Governance, Accountability and Democratic Legitimacy. Governance and Democracy: Comparing National, European and International Experiences. Routledge. Poister, H.T The Future of Strategic Planning in the Public Sector: Linking Strategic Management and Performance. Public Administration Review. Sangkala Dimensi-Dimensi Manajemen Publik. Yogyakarta: Capiya Publishing. Toppo, L. & Prusty, Twinkle From Perfomance Appraisal to Performance Management. Journal of Business and Mangement. 1st Fahdiansyah Putra, Fakultas Ilmu Administrasi, Universitas Indonesia, (fahdiansyah.putra@gmail.com) 2nd Bhekti Arum Lestari, Fakultas Ilmu Administrasi, Universitas Indonesia, (bhekti.arumlestari@gmail.com) 21