(delivered by Human Resource Policies and Standards Office Director IV Azucena P. Esleta for the CFASCUP-PASUC 1st National Faculty Association Partnership Convention on February 19, 2014, at Hotel Rembrandt, Quezon City)
A pleasant morning to all of you. It is a privilege to be with you on this occasion and to speak about a topic that is close to my heart—performance management. I hope by the end of this discussion, performance management would also be closer to your hearts as well.
I trust we all have encountered performance management systems throughout our professional careers, but I suspect only a few understand its significance beyond being an HR policy and a basis for your ratings. If there are HR practitioners here, I also know you have been briefed on the Strategic Performance Management System or SPMS at least once since last year, others would have been briefed more than once over the past months. We at the CSC know that whenever there is a new system being introduced and implemented, there is always a level of resistance and confusion. It is understandable, and it is also a necessary step towards change.
Interestingly, the highlights of my journey as a public servant coincided with paradigm shifts in performance management in the civil service. We have
BACKGROUND ON PERFORMANCE EVALUATION
I was 23 years old when I joined government service through the Civil Service Commission. I hold a degree in Accountancy with three years of experience as a bank accountant in the private sector. So imagine my reluctance and frustration when I was assigned to the Office for Personnel Planning and Performance Evaluation. During my interview, I had the impression that I was going to be involved in systems and management audit. But I found myself organizing CSC Memorandum Circulars—all ten filing cabinets of it. While going through that task, I got to thinking—what is my relevance to this organization? It was hard to figure that out, since at that moment, I had the feeling I was being given these tasks just to keep me busy, nothing more, nothing less.
But then I started to take interest in what I was doing. I started reading the marginal notes on policy studies that I came across while I was filing papers. Somehow, I had a glimpse of how the policies were crafted, and the wisdom and effort it took to have each policy see the light of day. From filing and reading those papers, I had an unexpected enriching experience. I learned that all CSC policies are anchored on the basic constitutional principle of public service—that public office is a public trust, that public service should remain accountable to the people at all time, and that performance evaluation is one important tool to manage personnel accountability.
In fact, it is so important that there is a whole office dedicated to it. I belonged to that office, and I was part of each paradigm shift in performance management that we have encountered since the late 70s.
The goal of performance management is actually stated in the Administrative Code in the Implementing Book V of Executive Order No. 292: Performance Evaluation System should be in accordance with rules, regulations, and standards promulgated by the CSC, and it should continually foster the improvement of individual employee efficiency and organizational effectiveness. Let’s see if how the development of performance management in the public sector responds to this mandate.
I. Performance Rating System (1963 onwards)
First, let us back track a bit to the days before I joined the service.
The earliest recorded performance evaluation system was called the Performance Rating System, based on CSC Memorandum Circular No. 6 issued in 1963. This system aims to improve individual employee performance, strengthen supervisor-employee relations, apply personnel policies, and develop a standard of satisfactory performance. This was also characterized by an input-oriented approach, measuring the abilities and attitudes of supervisors and non-supervisors at the workplace. Since this system relied more on the assessment made by supervisors, ratings of employees were often based on supervisors’ general impressions.
II. New Performance Appraisal System or NPAS (1978 onwards)
In 1978, CSC issued Memorandum Circular No. 2, which aimed to improve employee performance, develop personnel for higher positions, and provide opportunity for self-appraisal. Though it does not deviate drastically from the old system, the New Performance Appraisal System or NPAS used the output-oriented approach and paid more attention to the quality and quantity of work plus the turn-around time. The system was also more flexible in that employees had access to every process of the appraisal and were allowed to compute their own ratings.
The NPAS is definitely memorable for me because it was the first performance appraisal system that I encountered upon entering government. And while it had its strengths, I still had a lot of issues with it. I cannot reconcile my work objectives with the key result areas, which reflect the over-all mandate and thrust of the Commission. I simply knew that my work was being rated according to the dimensions of quality, quantity, and timeliness. However, I could not see how accountability came into the picture. As far as I was concerned, I could just think of commitment objectives at the end of the performance period, and simply align these with what she was able to accomplish. I still asked myself, ‘ano ba ang contribution ko sa CSC?’
"However, a big, nagging question remained in our minds: What are we really measuring? Saan ba tayo dapat timbangin? Kailan masasabi na ako ay isang lingkod bayan, that I can account to the people my salary drawn from the taxes they pay?"
III. Performance Evaluation System or PES (1989 onwards)
At this point, I already went through several assignments and several promotions. With this, there were also several changes in the way we did performance evaluation. In 1989, the CSC issued guidelines for the Performance Evaluation System or PES, which gave relative freedom to government agencies to craft their own evaluation measures following HR principles. Throughout the 90s and early 2000s, CSC issued additional PES guidelines, developing the system and making it more responsive to government HR needs. A substantial percentage of ratings were given to subordinates, so that ratings should not be solely based on supervisors’ prerogative. This should have allowed a more democratic process of negotiations and dialogue between supervisor and subordinate. However, the PES was individual-centered, and did not really provide a link between individual performance and organizational performance. While well aware that their work performance is being measured in one way or another, employees remain at a loss in connecting the significance of their contribution to the over-all performance of the organization.
Did I really feel any changes in performance evaluation during this time? Not so much. We were still using American management expert Peter Drucker’s framework of ‘management by objectives’ or MBO, also know as ‘management by results’ or MBR, a concept based on participative goal setting, measuring employee performance with the standards set by the organization. But he introduced these concepts way back in 1954. Surely HR should have developed since then, and we needed something that would better fit for the government of today.
With PES, there was dissatisfaction with supervisors’ ratings. We tried to remedy that by giving voice to the employees, and adding other dimensions to the rating system such as peers’ and clients’ ratings. But this time, as well, we were faced with the hard question—‘why do we keep changing performance management systems?’
Our answer was this: Performance evaluation has always been a contentious issue. Objectivity in performance evaluation has always been elusive. There is always discontentment, demotivation, and personal differences surfacing during performance rating periods.
By 1993, I was already a division chief. I hate the months of July and January—laging sumasakit ang ulo ko pag oras na ng ratings. With my accounting sensibilities, I could not reconcile why employees who exerted more effort or produced more output got lower ratings through PES. It did not seem logical to me.
I actually shared the sentiments of most colleagues at the time—performance rating is complicated, ang daming forms, ang daming raters, hindi nagiging makatotohanan ang ratings between peer and peer, si division chief takot magbigay ng mababang rate dahil baka gantihan siya ng kanyang subordinates. The Commission heard it loud and clear from the stakeholders.
At this time, the CSC was looking for alternative measures of performance that would address this problem.
IV. Performance Management System-Office Performance Evaluation System or PMS-OPES (2005 onwards)
After several years of field exposure, I was recalled to the CSC Central Office as Director III and was tasked to study the PES and suggest alternatives. Owing from my experience from the field and the institutional memory I have developed, I came to realize that so far, halos pare-pareho lang ang mga evaluation at appraisal systems that the CSC has implemented over the years. The systems focused on individual appraisal because these would be used for personnel actions, whether is be incentives, promotion, discipline, or separation. However, these systems did not show how an employee performance has contributed to or hindered organization effectiveness. Employees were also rarely given feedback on their performance. Thus, there is no sense of accountability, and the employee vaguely sees the need to contribute to the organization. This situation is brought about by problems in performance management where institutional accountabilities are not cascaded to the individual level and employees are not given the opportunity to participate in performance planning and development. Supervisors do not provide coaching so the staff are lost and could not see their place in the grand scheme of things, All these have resulted to mediocre to average performance, poor service delivery, and dissatisfied customers. Government employees have been placed on public scrutiny and there has been a growing demand for public servants to raise their level of performance.
However, a big, nagging question remained in our minds: What are we really measuring? Saan ba tayo dapat timbangin? Kailan masasabi na ako ay isang lingkod bayan, that I can account to the people my salary drawn from the taxes they pay?
On the brink of solving this puzzle, I was transferred to another office that was not really involved in matters of performance management. I became a fence-sitter, and it was during this time that the Performance Management System-Office Performance Evaluation System or PMS-OPES was introduced. This system aimed to align individual performance to organizational goals, and organizational goals to national goals, as set in the Medium-Term Philippine Development Plan, Organizational Performance Indicator Framework (OPIF), and Major Final Output (MFO). The PMS-OPES promoted an objective approach, setting 1 OPES point to every one (1) work hour as the standard unit of measure. The concept was “what gets measured gets done”. The late 2000s saw the development of the PMS-OPES, such as the creation of the OPES Table that identified the number of points assigned to tangible and non-tangible aspects of individual, unit, and organizational performance. The intent was to have “objectively-measured performance outputs” in order to eliminate bias or conflict between rater and ratee.
It seemed to be the performance management system that I have been waiting for, one that connects the individual not only to organizational goals, but to national goals as well. It seemed to show the path by which an individual employee may trace the significance of his or her contributions to organizational effectivity and national development. The system also used a common denominator among all government officials and employees—we all have 8 hours of work at our disposal. An hour became equivalent to 1 OPES point, and this was computed against a formula.
However, calibrating and computing points became a tedious process. The new system also promoted an activity-oriented mindset because tangible outputs that acquired greater points were what mattered the most. We failed to account for the service we were not able to deliver or demands we were not able to satisfy, as these concerns were overshadowed by the goal to simply acquire points. The original goal of showing the connection between individual performance and organization performance was not really met. Tinimbang ka ngunit kulang, ika nga. The points system approach, while effective in drawing up objective measures, was not widely implemented.
V. Salary Standardization Law—the bridge between PMS and Incentives
Then came the third trench of the Salary Standardization Law, as embodied in Congress Joint Resolution No. 4. This resolution says that there is a need for a performance-based incentive scheme that integrates personnel and organizational performance and a rewards system for exemplary civil servants and well-performing institutions.
One of the key features of this Joint Resolution is the progression of an employee from Step 1 to Step 8 of the salary grade allocation of the position in recognition of meritorious performance based on a CSC-approved performance management system and/or through length of satisfactory service.
I was involved in drawing up the provisions of the joint resolution, and CSC together with DBM eventually released a joint circular emphasizing that agencies may only give merit increased based on a CSC-approved PMS. We gave ample time for agencies to prepare for it. The circular was issued in 2011, and the grant will start in 2015, based on the 2014 performance evaluation that should strictly be based on the CSC-approved PMS.
VI. Strategic Performance Management System or SPMS and the Results-Based Performance Management System or RBPMS (2011 onwards)
If I could use one word to describe in general the changes that occurred in CSC since we entered another decade, it is strategic. The shift to strategy summarizes the CSC’s journey towards becoming Asia’s center of excellence for strategic human resource management and organizational development by 2030. We are now looking into developmental aspects of HR, leaving behind a transactional mindset. We have taken into account planning, streamlining, and aligning, not just to implement changes within CSC but to change how we work as well. This is a result of undergoing the Performance Governance System or PGS, which challenged us to lay down strategic priorities. One of these is the SPMS.
The SPMS clearly links employee performance with organizational performance to really enhance the performance orientation of the compensation system.
Employees in an organization have to see that they have common goals and are working towards the same direction. Each employee has a role to play and specific assignments that will contribute to the achievement of goals and targets. Employees may also expect to receive incentives based on a very objective performance management system.
At the time that the SPMS was being pilot tested in the Commission, a change in the national leadership happened.
President Benigno S. Aquino III’s famous line in his inaugural speech—‘kayo ang boss ko’—signalled reforms in the way things are done in the bureaucracy. It has become a constant reminder for government agencies and employees to respond to the call for greater transparency and accountability, and improved service delivery to their bosses—the public.
To give life to the Presidential pronouncement and in line with the Administration’s thrust to raise transparency and accountability in governance, Administrative Order No. 25 or the Unified Results Based Performance Management System was issued. The AO created an Interagency Task Force on the Harmonization of National Government Performance Monitoring, Information, and Reporting Systems.
This prompted the CSC to implement the SPMS bureaucracy-wide. A hard decision had to be made. While the CSC could have saved face and continued implementing the PMS OPES, we had to face the changing needs of the time. We had to work in harmony and at pace with the bigger environment for better governance.
SPMS and RBPMS complemented each other in that both drew up clear targets and demonstrated the link between individuals, organizations, and national development. Let me point out the similarities and areas of convergence.
VII. Points of convergence between RBPMS and SPMS
First, both systems’ goal is to strengthen the culture of performance and accountability in the bureaucracy.
The SPMS Objectives are: (a) to concretize the linkage of organizational performance with the Philippine Development Plan, Agency Strategic Plan, and organizational performance information system or OPIF; (b) to ensure organizational and individual effectiveness by cascading institutional accountabilities to the various levels of the organization; and (c) to link performance management with other HR systems.
The RBPMS, on the other hand adopts a common set of performance scorecard, and at the same time, creates an accurate, accessible, up-to-date government-wide, sectoral, and OPIF. The RBPMS will also be used as basis for determining entitlement to performance-based allowances, incentives, or compensation of government personnel.
"The shift to strategy summarizes the CSC’s journey towards becoming Asia’s center of excellence for strategic human resource management and organizational development by 2030. We are now looking into developmental aspects of HR, leaving behind a transactional mindset."
B. Performance indicators and targets
Second, the two systems’ performance indicators and targets complement each other.
The Harmonized Results Based Performance Management System utilizes the Five Key Areas set by the President, the Organizational Performance Indicators Framework (OPIF) and the Results Matrix as underlying frameworks. Under the RBPMS, there is a comprehensive performance indicators set that will cut across societal, sectoral, down to organizational performance with reference to the Five KRAs: (1) Good Governance and Anti-Corruption; (2) Human Development and Poverty Reduction; (3) Economic Development; (4) Security, Justice and Peace; and (5) Climate Change Adaptation. It also uses the Organizational Performance Indicators Framework (OPIF). In addition, other measures of agency performance were added such as financial stewardship, which looks into the judicious utilization of public resources and assets of the government; internal process efficiency, which focuses on driving efficiency and seamlessness in the work systems and processes to deliver services; and leadership, learning, and growth, which focuses on the ethical behaviour of the leaders that promote public trust as well as the innovation arising from learning and growth conditions within the organization.
The SPMS, on the other hand, concretizes the link of individual performance to organization performance. It ensures that performance goals and measurements are aligned to the national development plans, agency mandate/vision/mission and strategic priorities and organizational performance indicator framework.
Note that while the RBPMS cascaded indicators from Societal to Sectoral, down to the Organization, the SPMS provided the link between organization and individual employee performance, using the same set of indicators.
C. Reportorial requirements
On the reportorial requirements, the RBPMS adopted transparency and accountability tools. Report cards are used to visually organize performance measures and accomplishments and make it easy for users of the report such as the department heads, to act on the information and for the general public to appreciate accomplishments of the government. The Socio-Economic Report (SER) as prepared by NEDA will capture the cluster, sectoral, and societal goal accomplishments.
The Priority Program Accountability Report Card (PPARC), meanwhile, captures the accomplishment of targets with the President under the 5 KRAs:
- the MFO Accountability Report Card (MARC I), which captures performance results on the delivery of citizen-focused services and products; and
- the Management Accountability Report Card (MARC II), which captures organizational management results. In addition, it requires compliance with good governance conditions.
The SPMS, on the other hand, uses two forms that are similar to the RBPMS:
- the Office Performance Commitment Review or OPCR that captures performance results on the delivery of citizen-focused services and products and the accomplishment of targets under the offices’ KRAs and core functions; and
- the Individual Performance Commitment Review or IPCR, which captures individual performance commitment and results on the delivery of services and products that are linked to the individual’s organizational unit’s KRA’s and core functions.
D. Working committees or technical working groups
The RBPMS has an Inter-Agency Task Force chaired by the DBM and co-chaired by the Office of the Executive Secretary, with the following member agencies—the Department of Finance or DOF, the National Economic Development Authority or NEDA, the Presidential Management Staff or PMS, the Commission on Audit or COA, the Ombudsman, the Governance Commission for GOCCs, the Commission on Higher Education or CHED, the Career Executive Service Board or CESB, and the National Competitiveness Council, representing the private sector.
The SPMS, on the other hand, calls for the composition of a Performance Management Team (PMT) composed of the Head of Agency or his/her representative as the chair, the head of HRM and HRD offices, the head of planning offices, and the head of finance office.
In a meeting of the Inter-Agency Task Force, Cabinet Secretary Jose Almendras saw the need to have agency counterparts of the Task Force and in response, the CSC issued Memorandum Circular No. 8, s. 2013, which identified the agency PMT members as the anchor between the agency and the Inter-Agency Task Force.
On top of these, the SPMS underscored the importance of the following support mechanisms:
- an effective communication plan;
- an information system that supports data management;
- a monitoring and evaluation system; and a
- a change management program,
all of which are also supportive of the RBPMS’ objective of creating an accurate, accessible, up-to-date government wide sectoral and organizational performance information system.
Since agencies are not mandated to submit their accomplishments to the CSC, it is through the RBPMS that we get the complete picture of the performance of agencies and the bureaucracy. The SPMS, on the other hand, supports the RBPMS through the monitoring of all organizational and individual employee targets and accomplishment, and not just the targets enrolled in the RBPMS. Therefore, implementing only the RBPMS or only the SPMS will just provide us a glimpse of how the government is performing. It is only by harmonizing the RBPMS and the SPMS that we can truly give the public a full account of our performance.
"The key word is alignment—we have to be connected and integrated to be able to transform the culture of performance management in government."
VIII. Performance Based Incentive System—“marrying” RBPMS and SPMS
The year 2012 proved to be a promising year for the performance management system in the bureaucracy. The President of the Philippines again issued a directive adopting a Performance Based Incentive System for Government Employees as embodied in Executive Order No. 80.
The purpose of the Performance Based Incentive Scheme is:
to strengthen performance monitoring and appraisal systems based on existing systems like the OPIF, SPMS, and the RBPMS;
to improve the bureaucracy’s service delivery by linking personnel incentive to the unit’s performance and recognizing and rewarding exemplary performance in the public sector; and
to establish a Performance Based Incentive Scheme that aligns personnel efforts to organizational performance to reward exemplary civil servants and well-performing institutions.
The issuance of Performance Based Incentive completes the marriage between RBPMS and the SPMS. But will our journey stop here? The RBPMS and the SPMS are still works in progress. While we issued the guidelines on SPMS in 2012, we have yet to receive, review, and ascertain compliance of agencies with the basic features of the system.
Revising existing performance evaluation systems is necessary for us to be truly compliant with the rewards and incentives scheme that are now attached to performance. The key word is alignment—we have to be connected and integrated to be able to transform the culture of performance management in government.
We understand that agencies are having difficulty in the determination of major final outputs, setting targets, identifying performance/success indicators as well as cascading organizational outcomes to the individual outputs and contributions. We want everyone to be recognized by 2015 so we can all avail of the step increments under Joint Resolution No. 4, and of course, the PBB.
Last year as well, with the generous assistance of our partner the Philippines-Australia Human Resource and Organisation Development Facility or simply, the Facilty, we were able to publish an SPMS Starter Kit to provide a step-by-step guide in establishing the agency SPMS. The Starter Kit provides basic information and competencies needed to set up the SPMS. It aims to guide HRMOs in using the system to better identify, assess, and streamline performance measurement processes.
The RBPMS, on the other hand should not be limited to the present good governance conditions. The SPMS should ensure that compliance with the identified good governance conditions does not stop at the organizational level but is cascaded down to the individual level. But judging from the gains of the RBPMS and the SPMS, we are confident that these and more enhancements to the systems can be effected soon.
Where am I now with my journey? Already in the late 50s, I am now more open to change, I can now understand why changes and development happen. They are continuous processes.
How do I feel now? I feel more confident managing and evaluating the performance of my staff as there are objective measures and clear targets for them that are aligned to organizational goals. I feel that employees are more engaged now. I can also clearly see my role in the organization and my contribution to our sectoral and societal goals. And these give me so much hope in the government.
I can now say that efforts to strengthen, harmonize, and integrate performance and accountability systems in the public sector are making headway. We can see horizontal integration now in the government. Hindi na nag-iisa ang Civil Service Commission. With the inspiration and leadership that emanates from no less than the President of the Philippines, with all key government offices and officials working together with one common purpose and one common direction towards the right direction—the tuwid na daan—my very elusive dream of working with a true sense of purpose, responsibility, and accountability that will make me proud being a government employee is now within my sight and within my reach.
Having risen from the ranks to where I am now, I still count myself as a representative of the 1.4 million-strong public service workforce that we at the CSC want to transform to truly become servant-heroes or lingkod bayani. The lingkod bayani knows his and her value in the organization, and aligns his and her work to organizational and national goals. The lingkod bayani is no longer lost, no longer doing tasks to appear busy, no longer wondering where he or she fits in the bigger picture, just like I was years ago. I, together with more and more public servants, am now truly motivated to perform to the best of my ability, owing to a heightened sense of fulfilment, and with the knowledge that my contributions and accomplishments are being recognized.
How do you feel now that you are seeing the harmonization of the RBPMS and the SPMS? I hope that as you were listening to this discussion, you have somehow taken the pieces of the puzzle and are now creating a big picture in your heads. Should you still have questions, your CSC, along with our regional and field offices, is here to assist you.
Once again, thank you very much for giving the CSC an opportunity to be part of your program. I hope you will be able to apply strategic HR initiatives in your respective schools and universities such as the integration of the SPMS and RBPMS. Not only will this help you establish good HR practices, you will also be able to ensure that you are developing a competent and credible workforce that will uphold an excellent system of education in the Philippines.