Month: March 2015
Measurement Matters: What does ROI look like in government?
When launching a large project, like the City of Philadelphia’s recent implementation of a new Customer Management Relationship (CRM) solution, you want to keep the final Return on Investment (ROI) in mind. Naturally, the purpose of any project is result and solution driven. For The City of Philadelphia, our goal was to provide the customers of Philadelphia with a robust 311 system that had the ability to store knowledge base, serve as a social contact point, and provide accurate and real-time service request information. In essence, the goal of the new CRM was to create a more responsive, informative, and communicative point of contact with the City and its customers. And though we have successfully implemented this system, the question of how government can track the success of profitless projects comes into question. It is easy to follow a dollar. Money leaves tracks, but how does local government leverage private practice metrics to better inform future projects and practices?
Non-profits use a different measure of value to reflect a more impact-centric formula to measuring ROI. Monetizable outcome and value have taken command of the popular imagination, yet motivation, beliefs, and ethical practice are equally important, and have defined value in the public sector. Regardless, the bottom line is investment creates more investment.
According to a 2008 report from the ROI Institute, and comprehensive measurement and evaluation process data from over 200 organizations, “Global trends in measurement and evaluation” indicate “increased focus is driven by clients and sponsors,” and “ROI is the fastest growing metric.” These two factors demonstrate that increased focus for an organization is directly impacted by the return. Impact can easily be interchanged with the public sector’s definition of value.
The relationship between return, and exterior financial support, points to an across the board paradigm shift between all sectors. Activity is no longer sufficient evidence to justify activity. Activity–whether it is a program, a project, an initiative, or the creation of a product–must be result based. In this there is a need to abandon ambiguous performance measurements, forge more social partnerships, and use efficient CRM systems that capture data. With this paradigm shift, we see government adapting to result based processes.
Dr. Jack Phillips and Patricia Pulliam Phillips note in their review, “Using ROI to Demonstrate HR Value in the Public Sector: A Review of Best Practices,” that ROI methodology is currently being used in the public sector in a multitude of ways by entities like the USA Veterans Administration, Australian Department of Defense, and U.S federal government agency. These entities are using ROI to “demonstrate program success and impact of training on educational programs,” “measure the impact of a new human resources information systems,” and to “measure the cost benefit of a master’s degree program conducted on site by a prestigious government.”
The emphasis on managing data isn’t simply a sporadic interest in government, or a trend that the public sector is suddenly jumping on board with. From a federal level the 2002 President’s Management Agenda (PMA) pinpointed five government wide goals that have influenced this contemporary line of thinking. The goals speak to the need for strategic management of human capital, competitive sourcing, improved financial performance, expanded e-government, and budget and performance integration. The PMA’s goals indicate a need to find a comprehensive formula for combining ROI metrics and analytics that support social impact, program evaluation, and quantitative data to measure both a monetary and a non-monetary return. The outcome of finding this formula would result in more than just saving a few bucks, and could potentially result in productivity and quality increases.
In an earlier document from the ROI Institute, Dr. Phillips provides an example of what this would look like:
“In a government setting, cost savings measures are available from every work group. For example, if a government agency implements a program to improve forms processing–a productivity measure is number of forms processed; the quality measure is the error rate on processing forms; a time measure is the time it takes to process the forms; and a cost measure is the cost of processing forms on a per-unit basis. Improvements in work unit performance in a government setting have many opportunities for program benefits that can be converted to monetary value.”
One of the ways that the Third Sector Organization (TSO), in the United Kingdom, has attempted to qualify social value of their sector is through developing a methodology: Social Return on Investment (SROI). The goal of SROI is to translate social, economic, and environmental benefits into monetary value. Yet the SROI isn’t necessarily applicable to individual programs and initiatives, and still prioritizes financial measurements over, say, what a social audit would result in: qualitative information combined with financial data that informs internal performance.
Ultimately, even with the strides that the TSO has made, there is still a global gap in knowledge when it comes to gauging impact on smaller scale profit-less items. A 2013, working paper from the Tellurid Science Research Center concluded on a similar note, stating:
“There is an extensive body of grey literature on impact measurement practice, however this has tended to be small-scale and boosterist in nature. The field has also suffered from a lack of theorisation of key concepts and critical appraisal of previous research, with a few exceptions. A number of studies are emerging which attempt to address this theoretical and empirical gap, but in general empirical research on impact measurement practice in the UK third sector, particularly which organizations and subsectors are undertaking impact measurement and the practices and tools they are using, is limited.”
Though there are limitations, the potential remains there for the public sector to find an all encompassing return model, however no formula or practice standard exists at the moment. BUT there is still hope! As the global-municipal conversation circulates around transparency policies, and open data regulations, a dialogue about best practices ignites, and that includes the question of how to apply ROI in the public sector.
Photo by: Tax Credit
Find Your Voice: My “Day in the Life”
Dr. Stephen Covey, in his prequel to the “7 Habits of Highly Effective People,” “The 8th Habit: From Effectiveness to Greatness,” outlines the four steps to finding your voice:
1.What are you good at?
2.What do you love doing?
3.What need can you serve?
4. And finally, what is life asking of you?
For me, the answers to these questions overlapped, and lead to my current position as the Chief Customer Service Officer of the City of Philadelphia. Check out my “Day in the Life” episode, created by Philly311 TV, and learn about how I found my voice.
“Day In the Life” series is a way to show our constituents the human side of government. By highlighting the day to day of government workers, “Day in the Life” series transparently, and artfully, demonstrates individuals connection to the communities they serve.
Step Up to the Challenge: Modernizing Government using Open Data
Despite the strides city governments have made towards modernizing government, the buy-in still remains a point of contention for some municipalities. Observing what movements city governments are making, helps us see what is being prioritized, and assists in our understanding of why those strides towards modernization are being prioritized. Open data, open source, and cloud service solutions makes sense from a private sector perspective, however when you apply the same approaches to government initiatives, the stakes, and logic behind those actions, need to be rooted in something other than trend and modernization.
Let’s take a look at open data, for example. The Digital Accountability and Transparency Act (DATA) of 2014 largely influenced the open data trend: an act that enforces accessibility and transparency regarding information on federal expenditures. The goal was to help Americans understand how tax money was being spent and to establish a standard for government data. Yet this idea of transparency does not hinge on federal funding. Many Cities have been implementing open data, and in inventive ways. New York, for example, uses NYC Open Street data of trees to identify types of trees and their concentration within the city’s five boroughs. The City of Chicago collects data regarding landlords to create a “Map of Problem Landlords.” Austin, Texas is using transportation and traffic data to argue for one of the largest bike share programs in the world.
In the City of Philadelphia, the Nutter administration has always emphasized the need for transparency. In 2012, OpenDataPhilly, a “portal that provides access to more than 250 data sets, applications, and APIs related to the Philadelphia region,” was established. “OpenDataPhilly is based on the idea that providing free and easy access to data information encourages better and more transparent government and a more engaged and knowledgeable citizenry.”
Comparing the two goals of the DATA and OpenDataPhilly, we find commonality in motivation: the two are addressing a citizen-centric need for openness. Beyond this concept of democratic control, and how open data can self-empower citizens, enforcing open data policies delineates the importance of accurate and useful date. Having accurate and useful data helps in measuring policy impact, which can ultimately drive policymaking. Because of open data–and the publics reception and use of it–elected officials are able to make better decisions.
Having open data goes beyond trend and modernization efforts. Today, open data is a tool of democracy that speaks directly to citizens needs. Open data drives transparency, encourages government, and enhances the customer’s experience with their government.
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