In October 1997, the Trade Commissioner Service (TCS) Performance measurement in the Canadian Trade Commissioner Service THE MANAGER S CORNER
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1 Performance measurement in the Canadian Trade Commissioner Service Pierre Sabourin Ten lessons to ponder before embarking on a performance measurement initiative to improve your way of working. In October 1997, the Trade Commissioner Service (TCS) of the Department of Foreign Affairs and International Trade launched a performance measurement initiative as the pièce de résistance of a major renewal effort. The resulting system is now being implemented at the more than 100 TCS offices worldwide. Globalization and technology revolution are two of the most frequently heard buzzwords of the 1990s. The Canadian Trade Commissioner Service, with its mandate of promoting the economic interests of Canada throughout the world, can well attest to what happens when these two concepts combine. For example, the advent of fax and has made it easy for Canadian companies to make market inquiries free of charge to trade commissioners around the world. During the past ten years, trade commissioners in many markets have become progressively swamped with general market inquiries from potential new exporters. There were more than 100,000 requests last year alone! Adding to this growing demand for the attention of trade commissioners are the many special trade missions that other government departments, provinces and municipalities are busy organizing these days. Unfortunately, service demand has been growing at a time of major government cutbacks. By 1997, budgetary constraints were such that only 50 percent of Canadian trade commissioners could be posted abroad, a situation that led to considerable staff discontent and some departures. Consequently, from a strategic perspective, the Trade Commissioner Service was being pressured down the service value chain. Instead of allowing trade commissioners Pierre Sabourin is currently with the Trade Commissioner Service of the Department of Foreign Affairs and International Trade, where he manages the design and implementation of a performance measurement project. His professional experience includes private sector consulting, principally on projects for the World Bank and the Asian Development Bank. Mr. Sabourin teaches in the Executive MBA and International MBA programs of the University of Ottawa. 30 Optimum, The Journal of Public Sector Management Vol. 29, No. 1 (30-35)
2 to focus on serious exporters wanting high-value market intelligence and foreign-partner brokering, they were being pressured into spending more and more time providing the lower-value market information and logistics organization requested by many new exporters. This occurred despite the increasing availability of information services through the Internet. Established clients were telling trade commissioners that the higher-value TCS services abroad were becoming increasingly inconsistent. As well, the Auditor General had indicated back in 1996 that the TCS did not possess a system that equated activity to results. The TCS needed to develop a new way of doing work in an evolving business environment. The response was to undertake a Performance Measurement Initiative. Interestingly, this was an initiative concerned not so much with measurement as with organizational change and improvement. Here are some of the lessons learned from the TCS project. Lesson 1: The planets must be aligned A performance measurement project is really a change management project. A performance measurement project, if successful, will produce information about the effectiveness of the organization. This information should in turn generate action toward improving service delivery. Therefore, performance measurement is closely linked to change management, and change management projects are expensive and risky. Do not start a performance project if your organization does not have its planets aligned. This means being able to answer yes to the following questions: Will staff, clients and partners understand why a performance measurement project is necessary? Are the human and financial resources available? Can benefits be clearly articulated to employees and management? Is senior management committed and involved in the project? Are the risks and consequences of the project understood? Will the inevitable changes be accepted as necessary and be implemented? In the TCS, the planets became aligned when the Assistant Deputy Minister recognized the urgency for change and launched a performance measurement initiative. Its ultimate purpose was to renew the TCS. Lesson 2: Get your performance paradigm right This is not the same as get the right paradigm. Make sure a performance model is chosen that can be adapted to your organization. Do not try to rigidly impose a generic performance model on your unique organization. There is no shortage of available performance paradigms : ISO 9000, 1 benchmarking, Balanced Scorecard, 2 etc. There is also no shortage of consulting firms to demonstrate the merits of these paradigms. Choosing a performance model is a critically important step, for it will help in developing the performance indicators and show how they can be linked to improving your organization. If the TCS experience is any example, it is highly unlikely that a given model will be exactly right for your organization. Instead, choose a model and then make it fit your organization, not the other way around. The usefulness of the performance model selected is proportional to its ability to improve your organization. To ensure critical linkage, the TCS adapted the Balanced Scorecard model to include service improvement components as well as performance-based ones. In practical terms, the TCS project comprised the following parts: client surveys and focus groups to evaluate performance from a client perspective; employee surveys to enlist employees in the initiative and gather their ideas; workload measurement to identify service delivery pressure points in the organization; Optimum, The Journal of Public Sector Management Vol. 29, No. 1 31
3 client and service definitions to clearly define who the clients are and what services are being delivered; service standards and guidelines to help employees deliver services; and a service-charge feasibility study to evaluate the desirability and feasibility of charging. By making it clear from the outset that the project was about service to clients, the TCS project team put performance measurement in a positive light. By shifting the focus from measurement per se to service improvement, TCS employees better understood the ultimate objectives and supported the process. Lesson 3: Build your project team with diversity in mind Complex expertise will be needed to complete your project. But make sure it is driven internally so that the performance indicators are tied to your business. A performance measurement project is no small undertaking. The TCS project team had diverse knowledge of the business, as well as performance measurement expertise. Knowledge of the business flowed down to the team from the very top. The champion was the Chief Trade Commissioner, who is at the Assistant Deputy Minister level at the Department of Foreign Affairs and International Trade. The TCS champion secured a knowledge base for the project by forming a steering committee of a driver (a director general) and a dedicated unit (two directors). The team was put together so that the need for project managers and specialized consultants was balanced (see Figure 1). Since buy-in is essential to success, it was critical to have support not only from senior management within TCS, but also from the organization s opinion leaders the ones who can make or break any management project at implementation. Each project component had an advisory group of stakeholders and opinion leaders from junior and senior levels, to serve as sounding boards throughout the initiative. These groups continuously passed along valuable comments and experiences that guided the team s progress. FIGURE 1 Trade Commissioner Service project team ADM - Champion DG - Driver Dedicated unit Cross-functional diverse team Lesson 4: Carefully map the road ahead + Consultants and advisory groups How does everyone benefit? Communications Knowledge of business Performance measurement expertise Planning is more than writing terms of reference and developing a chart. It must also clearly articulate the expected benefits of performance information for all stakeholders. Setting out the benefits at the beginning involves stakeholders early on and provides them immediately with practical answers to the questions, What s in it for me? and How will performance information affect my day-today job? In the TCS case, the team articulated the benefits in the context of a project blueprint, a document that has proved and continues to prove immensely useful. Lesson 5: Don t underestimate the difficulty ahead; build flexibility into your plan Even with thorough planning, performance measurement in government will not be easy. Plan also to be flexible in your project approach and implementation. Not even the most careful and prescient planner can provide for every contingency. The TCS project revealed 32 Optimum, The Journal of Public Sector Management Vol. 29, No. 1
4 that no matter how good the plan, unexpected or underestimated problems arise that make performance measurement a much harder task than initially expected. The only preventive measure that can be recommended is flexibility. Spend as much time as possible in planning, but prepare also to be flexible in the approach and implementation of your project. Many of the problems faced will be peculiar to your own organization, but some will be common to any government organization trying to implement performance measurement. One salient problem that the TCS group underestimated and found very difficult to overcome was the massive skepticism and resistance that had built up in government service between employees and management. Despite its importance or necessity, a performance measurement project is an extremely tough sell in the wake of so many government change initiatives in recent years. When an organization has been downsized and staff salaries frozen for years, who really wants the additional pain that comes with measurement? This is a problem that ultimately only a successful performance measurement system, which actually improves the organization and the work life of its employees, can resolve satisfactorily. In the meantime, however, a flexible approach and constant consultation and communication efforts can at least keep this problem from becoming a defeat. Lesson 6: Define your clients and your services You can only measure efficiently if you know exactly who your clients are and what services you provide to them. In developing a performance measurement initiative to improve service delivery, it is essential to understand precisely what is being delivered in the first place. As in most organizations, the Trade Commissioner Service assumed that colleagues and clients had a good notion of what it did. When the TCS project team checked, however, it discovered that clients actually had extremely diverse perspectives on what trade commissioners did and what services could be expected from the organization. Even trade commissioners themselves had different views on who was their primary client. What would have been the point, then, in measuring client satisfaction in the face of such diverse opinions about the role of TCS? It became clear that before the team could measure anything, it had to define its clients and the services they could reasonably expect from TCS. With an eye to maximizing results and value for money, the TCS team set about defining clients on the basis of results orientation. The results depend largely on the achievements of TCS clients in international trade and will be evaluated accordingly. The team determined that the TCS focus had to be on those Canadian companies that could demonstrate, through evidence of prior market research and selection, a basic commitment and capability for achieving results in foreign markets. Any such company may obtain services from TCS offices abroad. As for companies not yet meeting these basic criteria, TCS intends, henceforth, to refer them to the services of its partners in Team Canada Inc. The primary role of this domestic trade services network is to help new exporters prepare for foreign markets. The TCS team, through consultations over many months, developed a definitive list of services, as well as service-standard guidelines to help officers posted abroad deliver the services to their clients. Having been printed and distributed to clients, the list now serves as a common reference point for measuring performance. Both staff and clients now know what is being measured. At the same time, TCS has improved service by clarifying what it can and cannot do for clients. Focusing on the client ensures that performance measurement becomes client-driven, not activity-driven, and that performance indicators are developed with a view to building competitive advantage, not maximizing activity. Lesson 7: Realize that a performance measurement system is much more than the sum of its measurement instruments It s not about measurement. It s about management. Since performance measurement is only a means to an end, performance systems should reflect the larger purpose Optimum, The Journal of Public Sector Management Vol. 29, No. 1 33
5 of the enterprise. In the system that the TCS team developed, the measurement instruments (i.e., client surveys, employee surveys and workload/cost indicators) are integrated with information and business systems. The information system is the computerized client management system for tracking service delivery within TCS. The business systems are the new services list and its related service-standard guidelines. These linkages allow synergy between the various systems and contribute to building a coherent whole (see Figure 2). The linkages also provide opportunities for new types of measurements since data from various performance systems can be compared and analyzed. Business Systems services list service standards service charges? employee survey client survey FIGURE 2 Linking the systems Information Systems client management system results tracking Performance Measurement System workload costs Performance measurements themselves have little intrinsic value. They are only useful in producing information that leads to the establishment of change initiatives for employees and clients. These initiatives will affect the information and business systems. This has important consequences from an organizational perspective. You will need to plan for dedicated human and financial resources for the ongoing process of performance measurement and the management of the related change agendas. Lesson 8: Focus your measurements on key performance indicators It s the leading indicators that are important. Typically, organizations set general standards such as client satisfaction and employee satisfaction as their performance goals. Such goals are essential for determining performance improvements over time. Once these are set, the normal practice is to identify a large set of indicators for each goal and to measure performance according to each and every indicator. However, the TCS project team found that only a few leading indicators proved critical in each case, and that it was not necessary to select and use many of the identified secondary indicators. For example, among the indicators the team might have selected for employee satisfaction, it was found that leadership, communication and workload were the driving factors of performance. Through analysis, the team determined that improvement in these three indicators would lead most appreciably to improvement in employee satisfaction over time. Therefore, the team created an employee action plan around these leading indicators. In defining performance indicators, it is also important to keep in mind that these may ultimately form the basis for senior management to make strategic decisions on matters such as resource allocation. Lesson 9: Consult and communicate Constant consultation and communication at every stage from start to end are key success factors in a performance measurement project. Consultation means learning from others, i.e., benefitting from the experience and expertise of staff, clients, partners and other stakeholders. It takes time and effort but, in the end, is worthwhile, for it means getting help without having to reinvent the wheel. The TCS team conducted an extensive review of the performance measurement practices of a number of trade 34 Optimum, The Journal of Public Sector Management Vol. 29, No. 1
6 agencies worldwide. This took considerable time, but proved to be a good learning experience, one which enabled TCS to avoid many common pitfalls. Communication means explaining your motives and your objectives, and putting stakeholders in the full picture. If done well, it means securing their understanding and buy-in. In a performance measurement project, the communications function must above all concern itself with the message that the ultimate goal is not measuring, but improving, the organization. This message cannot be reinforced enough. Performance measurement will raise concerns among employees, and these can be addressed in good part through communications. TCS dedicated one person to communications and developed a detailed communications plan. By enlisting senior management in implementing the plan, they became its best communications vehicle. They articulated the need for change during the entire project and frequently reaffirmed their commitment to change, and to protecting and supporting the performance measurement initiative. For example, at the launch of the TCS project, the champion (assistant deputy minister) held more than twenty conference calls with 100 mission chiefs worldwide to explain the initiative and its consequences. Six months later, the driver (director general) held a similar series of conference calls to report progress and address any concerns. And now, a year later, the dedicated unit (TCS directors) is again communicating with all missions abroad to inform them of the progress made and to gather feedback. Lesson 10: Change is about incentive measures and training Performance measurement leads to a new approach to conducting your business. A new approach to conducting Trade Commissioner Service business has always been the ultimate aim of the project. Even so, it was only gradually that the team became fully aware of the scope and implications of the new approach. At the end of the day, if performance measurement leads to change agendas, as it should, taking action on these agendas will result in new service delivery modes, changes to the workplace and changes to operations. Indeed, a new approach through performance measurement amounts to a radical change in an organization s culture. Measuring performance is hard enough in itself, but implementing the related changes is even harder. Therefore, the TCS team is now focusing its efforts on making the concepts of client service, performance and continuous improvement part of the organizational culture. Ultimately, the TCS performance measurement system can succeed only if its employees learn to understand and respect the new modus operandi and change their behaviour accordingly. It became obvious, as TCS recently began to implement the new system, just how crucial training and incentive measures would be. These measures may be the key success factors to ensuring buy-in and successful implementation. Endnotes 1. See International Organization for Standardization. Online: 2. R.S. Kaplan and D.P. Norton. The Balanced Scorecard: Translating Strategy into Action (Boston: Harvard Business School Press, 1996). Optimum, The Journal of Public Sector Management Vol. 29, No. 1 35
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