ABSTRACT Extreme and major changes are increasingly occurring in the environment in which public institutions operate. An obvious manifestation of the responses towards this turbulent environment is the introduction of performance contracting in Makerere University as part of the broader public sector reforms aimed at improving efficiency and effectiveness in management. The main objective of this paper was to look at a critical review of performance contracting in public institutions. The scope of the study was limited to Makerere University and the impact of performance contracts on service.
The paper concludes that performance contracting as an implementing tool in strategic planning is of great importance under the New Public Administration at Makerere University. There is, however, need for a good definition of outputs and solid performance measures which will be able to promote Makerere’s internal performance through a well customer-oriented ability of employees to further promote its external performance. TABLE OF CONTENTS DECLARATION2 APPROVAL3 DEDICATION4 ACKNOWLEDGEMENT5 ABSTRACT6 ABBREVIATIONS8 SECTION I9 1. 0Introduction9 1. 1 Origin of Performance Contracting12
SECTION II20 2. 0Literature Review20 2. 1Implementation of Performance Contracting20 2. 2Monitoring and Evaluation of Performance Contracting22 2. 3Impact Evaluation25 2. 4 The Effects of Performance Contracting29 SECTION III38 3. 0Empirical Discussions38 3. 1The Situation at Makerere University before Embracing Performance Contracts38 3. 2Introduction of Performance Contracts at Makerere University43 3. 3The Effects of Performance Contracting in Makerere University44 3. 4Conclusion53 3. 5Recommendations54 Bibliography55 ABBREVIATIONS BARSBehavioral Anchored Rating scale
FYFinancial Year HEIsHigher Education Institutions ICTInformation and Communication Technology MUKMakerere University Kampala MUASAMakerere University Academic Staff Association NPMNew Public Management OECDOrganization for Economic Cooperation and Development UGCUniversity Grants Committee URAPUniversity Ranking by Academic Performance ? SECTION I 1. 0Introduction Contractualisation in the public sector has become paramount worldwide with the spread of the New Public Management doctrine which emphasizes the adoption of private sector practices in Public Institutions (Hood, 1995).
The origin of the phenomenon finds its roots in the Nora Report presented in 1967 to President George Pompidou in France. This report recommended giving more autonomy to public enterprises while contracting with them to set clear goals and compensation schemes for social objectives. This move has reached the developing world, where performance contracts were introduced. In Asia, the Performance Contract concept has been used in Bangladesh, China, India, Korea, Pakistan and Sri Lanka. In Africa, performance Contracts have been used in selected enterprises in Benin, Burundi, Cameroon, Cape Verde, Congo,
Cote d’Ivoire, Gabon, the Gambia, Ghana, Guinea, Madagascar, Mali, Mauritania, Morocco, Niger, Senegal, Togo, Tunisia, Zaire, Kenya and later Uganda. The development of performance contracts has indeed gone along with giving more autonomy to public organisations, complying with a specific vision of the role of the government, setting objectives, evaluating, appointing and rewarding the managers, providing resources and doing nothing else (Williamson,1975). A rigorous performance contract exercise reveals the true costs and benefits associated with a particular public enterprise.
This, in turn, provides a valuable basis for Privatization. Similarly, the Performance Contracts with government departments are being used extensively in organization for economic cooperation and development (OECD) countries to improve the delivery of public services and effectiveness of government machinery. In quest of this same goal, Uganda introduced performance contracting not only to improve service delivery but also to refocus the mind set of public institutions away from a culture of inward looking as witnessed in the years before for example in Amin’s regime towards a culture of business as focused on customer and results.
Example to this introduction of performance contracts is the case where the Uganda national water operator has become world famous to have managed to increase dramatically its performance thanks to performance contracts signed since 2000, both with the government and internally. Performance contracts have been adopted in most public institutions as part of the broader public sector reforms aimed at improving efficiency and effectiveness in service delivery.
A Performance Contract is defined as a management tool for measuring performance that establishes operational and management autonomy between government and public agencies (Omboi B. M. , 2011) whereas performance contracting is a freely negotiated agreement between government acting as the owner of a public enterprise and the enterprise itself in which the intentions, obligations and responsibilities of the two parties are freely negotiated and clearly set out.
It organizes and defines tasks so that management can perform them systematically and with reasonable probability of accomplishment. As part of performance management, performance contracting is a central element of new public management, which is a global movement reflecting liberation management and market-driven management. “Liberation management” means that public sector managers are relieved from a plethora of cumbersome and unnecessary rules and regulations which usually hinders quick decision making in the organization (Gianakis, 2002).
The debate in Public Institutions has been more complex that is increasing the effectiveness of strategic management systems and narrowing the gap between ambitious strategies and annual planning alongside improving external accountability and increase in internal efficiency and effectiveness at the same time. In particular, Performance Contracting is seen as a tool for improving Public Institution’s budgeting, promoting a better reporting system and modernizing Public Institution’s management while enhancing efficiency in resource use and effectiveness in service delivery (Greiling, 2006).
Makerere University, over the years has been growing both in student numbers, programs, research and outreach. From a humble technical school in 1922, Makerere is now an internationally well-known University with a population of about 35,000 students (45% of whom are female) (MUK, Fact Book 2011) thus necessitating embracing Performance Contracting in a bid for providing and acquiring quality goods and services within the available budgetary resources.
The goal of this paper is to look at a critical review of Performance Contracting in the Public Institutions with special emphasis on Makerere University and assess the impact of the performance contracting on service delivery. The paper therefore describes and examines the concept, process, utilization of resources and the strategies that may be put in place to facilitate the realization of the Performance Contract. 1. 1 Origin of Performance Contracting The term performance contracting can be traced from France in the late 1960’s and other countries including India, Pakistan and Korea (OECD, 1997).
Prior to this period the business environment was rather stable and therefore strategic planning was entrusted in the hands of the top management of the organization. This practice was counterproductive as managers who were implementers of the strategic plans were not involved at the formulation stage. Aosa (2000) supports this view when he argues in his study that due to increased environmental turbulence in the early 1970’s, especially 1973 top executives were forced to recast the way they looked at their business for survival.
They redefined performance management as a proactive management tool for achieving business goals and objectives, through a structured and continual process of motivating, measuring and rewarding individual and team performance. Earlier, management tools for example the Carrot-and-Stick policies and behavior which were common in the 19th Century Industrial Age had become increasingly irrelevant to modern management practices and therefore, this called for more flexible and adaptability in strategic planning, forcing managers responsible for implementing strategies be involved in all stages of strategy formulation (Barclays Africa, 1997).
However, Steiner (1983) speculates that many of the strategic planning systems failed to link planning and resource allocation and did not place emphasis on strategy implementation. He further observes that the existing systems failed to reward managers and employees for strategic thinking, creativity and innovation. This led to disenchantment with strategic planning and thus forcing managers to believe that it was of little or no value to the organization.
Despite of these problems practitioners and academics like Porter (1983) came in support of strategic planning by placing emphasis on strategy implementation. In Canada, the government’s approach to performance contracting and management were rooted in early 1990’s expenditure management systems designed to cut costs during a period of budget deficits (Kernaghan & Siegel, 1999) and in France they were first introduced in the Directorate General for Taxes specifically designed to respond to two main concerns (Grapinet, 1999).
First, as tools meant to ensure consistency in a decentralized context and second, as tools to enhance pressure on the entire services network in order to improve performance. Performance Contracting Management Processes Sean (2009) points out that Performance Contracting should be much more than a process for documenting and delivering feedback, coaching and ratings. He believes that when expanded beyond these basics, Performance Contract becomes a powerful tool for helping employees develop and achieve their full potential.
Performance management process typically involves four main stages namely work plan management, skills development, performance monitoring and evaluation, and rewarding of outstanding performance. In terms of work plan management, it is based upon business plans and other corporate documents, key deliverables and areas of responsibility to which staff members contributions are determined. A staff member and manager agree on the work and responsibilities of the staff member’s position. The plan will also set out how the staff members’ performance will be measured or evaluated against set objectives (Akaranga, 2008).
On the other hand, in terms of skills development, the staff member and the manager identify and agree on the learning, development and information needs of the staff member to meet their performance and the business needs of the business unit. This would include selecting options and the development of an action plan to access the opportunities identified (Armstrong, 2006). Similarly, under performance monitoring, the staff member provides regular feedback to the manager on their progress towards the achievements of the agreed performance objectives.
The manager provides regular formal and informal feedback on their assessment of the staff member’s achievements. Within the context of performance evaluation, Armstrong and Baron (2004), argue that the manager and the staff member should regularly (periodically) evaluate the staff member’s performance and the achievement of the objectives in the work plan as well as the agreed training and development plan. This phase should then feed into the next cycle of the performance management process. Lastly, with regard to rewarding outstanding performance, there is need to reward outstanding work which is recognized from the evaluation reports.
The top performers need to be rewarded in various ways ranging from recognition to award of medals and other material endowments (Armstrong, 2006). However, according to Moy (2005) the performance based contract process in federal government in Washington D. C. relates heavily to the federal guidelines established by the Office of Federal Procurement Policy. Despite differences in the federal and state perspectives, Moy comes up with Seven Steps to Performance Based Service Acquisition which he speculates that provide an overview of the contracting process.
Firstly, there is an integrated solutions team whose main task is to ensure that senior management involvement and support is in place. The team defines roles and responsibilities, empowers team members and identifies stakeholders, nurture consensus, develop and maintain the knowledge base over the project life, and establish a link between program mission and team members’ performance. Secondly, the problem that needs to be solved is described. This links acquisition to mission and performance objectives, defines desired results at a high level, decides what constitutes success, and determines the current level of performance.
Thirdly, examines the private sector and public sector solutions. This includes taking a team approach to market research, spending time learning from public sector counterparts, considering one-on-one meetings with industry and documenting market research. Fourthly, develop a performance work statement or statement of objectives, which involves conducting an analysis of work to be performed, capturing the results of the analysis in a matrix, writing the performance work statement, and allowing the contractor solve the problem, including the labor mix. The fifth step deals with how to measure and manage performance.
This involves a review of the success determinants (i. e. Where do you want to go and how will you know when you get there), relying on commercial quality standards, if applicable. Ensure that the contractor proposes the metrics and the quality assurance plan, select only a few meaningful measures on which to judge success, including contractual language for negotiated changes to the metrics and measures, consider “award term” (i. e. ties the length of contract to the performance), consider other incentive tools, recognize the power of profit as motivator, and most importantly, consider the relationship.
The sixth step is selection of the right contractor who should be advised of the best practices and trends in performance based contracting. Lastly, it deals with managing performance by keeping the team together, adjusting roles and responsibilities, assigning accountability for managing contract performance, adding the contractor to the team at a formal kick-off meeting, regularly reviewing performance in a contract performance improvement working group, and reporting on the contractor’s past performance. Purpose of Performance Contracting An organization’s purpose defines the ways in which it relates to its environment.
If this purpose is fulfilled, the organization will survive and prosper (Luo & Peng, 1999). The main purpose of the performance contracting according to Armstrong and Baron (2004) is to ensure delivery of quality service to the public in a transparent manner for the survival of the organization. Hope (2001) points out that performance contracts specify the mutual performance obligations, intentions and the responsibilities which a government requires public officials or management of public agencies or ministries to meet over a stated period of time.
As part of the performance orientation in government, the common purposes of performance contracting are to clarify the objectives of service organizations and their relationship with government, and facilitate performance evaluation based on results instead of conformity with bureaucratic rules and regulations which have killed thinking, innovation and creativity in the public sector (Hitt et al. 1999).
Grapinet (1999) hypothesizes that performance contracting involves a highly structured phase of evaluating results which he considers to be an extremely rigorous technical exercise on one hand and on the other hand a morale-boosting exercise for managers and staff. The performance contract does not actually go into resource appropriations which, although needed for practically all resources, are automatic. He further argues that members of staff are not sufficiently involved in drawing up contracts, a task which in spite of exhortations from central government is still largely the preserve of managers.
In management terms, this means that performance goals are all too often perceived as being imposed from above rather than from a collective thought process. Gore (1996) recognizes the importance of performance contracting when he admits that in the United States federal government, performance contracts are in one way or the other changing the way many bosses do their jobs. Gore believes that many managers have changed their attitude towards workers which in turn has encouraged innovation and good customer service.
On the other hand, Hill and Gillespie (1996) argue that performance contracting is expected to increase accountability because of the clear and explicit managerial targets, combined with managerial autonomy and incentives to perform, make it easier to establish the basis for managerial accountability and to achieve outputs. Further, Therkildsen (2001) speculates that performance contracts if well executed increase political accountability by making it easier for managers to match targets with political priorities.
Politicians can, in turn, hold managers accountable for their performance as being witnessed in many developing nations. Principles of Performance Contracting Customer-Focused Organisation: “Organisations depend on their customers and therefore should understand current and future customer needs, meet customer requirements and strive to exceed customer expectations”. Leadership: “Leaders establish unity of purpose and direction of the Organisation. They should create and maintain the internal environment in which people can become fully involved in achieving the organization’s objectives. Involvement of People: “People at all levels are the essence of an organisation and their full involvement enables their abilities to be used for the organization’s benefit”. Process Approach: “A desired result is achieved more efficiently when related resources and activities are managed as a process. ” System Approach to Management: “Identifying, understanding and managing a system of interrelated processes for a given objective improves the organization’s effectiveness and efficiency. ” Continual Improvement: “Continual improvement should be a permanent objective of the organisation. Factual Approach to Decision Making: “Effective decisions are based on the analysis of data and information. ” Mutually Beneficial Supplier Relationships: “An organisation and its suppliers are interdependent, and a mutually beneficial relationship enhances the ability of both to create value. ” ? SECTION II 2. 0Literature Review 2. 1Implementation of Performance Contracting To understand the successes and challenges of implementing performance contracting, Kobia and Mohammed (2006) carried out a survey among the civil servants.
They developed a questionnaire from performance contracting literature and administered it to a sample of 280 senior public service course participants at the Kenya Institute of Administration. Data were collected from the course participants who were central in the implementation of performance contract in the government ministries and agencies. To investigate if the participants knew the goal of performance contracting, they asked them to state the goal of performance contracting in their ministries. A majority of the respondents 72. percent summed the goal as the improvement of performance/enhance efficiency and effectiveness in service delivery through a transparent and accountable system. Further 73. 6 percent acknowledged that their ministries had signed the second (2006/7) performance contract with the Government. The responses indicate that majority of the participants were conversant with performance contracting. Regarding training in performance contracting, Kobia and Mohammed were fascinated to observe that only 57 respondents had received training in performance contracting while a majority 75. percent had not received any. It is interesting to note that 74. 3% indicated that they would require further training on all aspect of performance contracting. The study shows that over 60 percent of the respondents acknowledged that with the implementation of performance contracting, public servants are more involved in decision making, felt evaluation of the performance is done fairly, they knew where to seek assistance concerning meeting the targets and had assisted in understanding government policy documents.
However over 62. 1 percent respondents indicated that they did not have adequate resources needed to meet their targets which could easily adversary affect the individual and ministry performance. To investigate participant’s experience with the implementation of performance contract, the researchers asked several questions regarding whether the participants had signed performance contracts with their supervisor and whether they had experienced any problems with implementation of the performance contracting.
The result was interesting as only eight percent had signed the performance contract. They indicated some of the problems experienced during the implementation of the performance contract as, lack of adequate resources, resources not being released on time, and unplanned transfer of staff (Kobia & Mohammed, 2006). In general, the study shows that performance contracting has induced the public service to become more oriented towards customers, markets and performance, without putting the provision of essential public services into jeopardy.
The introduction of performance contracting and management by results is used to improve the performance of an organization as it emphasizes better the human resource management. 2. 2Monitoring and Evaluation of Performance Contracting The process of monitoring and evaluation is defined by management theory, as well as political science theory, as the collection and analysis of relevant data about organizations’ achievements and the implementation of actions to improve future performance (McKelvey & Palfrey, 1996).
Control and monitoring is frequently identical with accountability when public needs and interests are involved. As was viewed by Stewart and Ranson (1994), organizations in the public domain exercise substantial power for which they are accountable. Public accountability must involve a political process which responds to the many voices of citizens and other stakeholders. A response is defined by Hirschman (1980) as a pure political action compared with an exit which represents more of an economical action.
Since citizens generally do not have the alternative of exit in a public market, the option of voice becomes more relevant and imminent. Moreover, it seems that western democracies are facing pressures for greater rather than less accountability on behalf of their citizens (Anthony & Young, 1984). Pollitt (1988) acknowledges that while it is not obvious that the accumulated wisdom of the private sector is transferable to the public sector, inevitable interactions between the two spheres are productive for both.
In Kenya, for instance the government is encouraging the Public-Private sector partnership in order to improve on service delivery. Smith (1993), on the other hand, identifies two different indicators for measuring public sector performance which are internal and external to the organization. Measures of internal performance, such as managerial processes, routines and formal procedures, are of limited interest to ordinary citizens yet there are also those which attract more attention in management literature.
Their main objective is to enable the central government secure closer control of devolved management teams. However, Palfrey et al. (1992) argue that the external indicators are intended to enhance the accountability of public organizations to external interested parties, for example service users, the electorate, taxpayers and central government. The role of such outcome indicators is to furnish external users with information about the consequences of public sector activity so that citizens can make better judgments about the organization’s performance.
They compare this process of public accountability to stakeholders, with the role adopted by financial reporting in the private sector. As in the private sector, increasing external related outcomes, such as the responsiveness of public authorities to citizens’ demands, will have a profound impact on internal control mechanisms, as managers and public servants become more sensitive to their duties and highly committed to serve the people. Muralidharan (1997) argues that citizens are the clients and main beneficiaries of public sector operation and thereby should be involved in every process of performance evaluation.
In their study, responsiveness of the public sector to citizens’ demands is mentioned as an important part of performance control. This is because it refers to the speed and accuracy with which a service provider replies to a request for action or for information. According to this definition, speed can refer to the waiting time between citizens’ requests for action and the reply by the public agency. Accuracy means the extent to which the provider’s response is appropriate to the needs or wishes of the service user (Miller & Friesen, 1983).
Nonetheless, while speed is a relatively simple factor to measure, accuracy is a more complicated factor to measure. In Kenya, many public institutions have developed citizen service charters which spell out their service commitments in terms of timeliness, service requirements; value for the service provided and redresses mechanisms. These service charters are, however not well monitored as there is no measuring mechanism put in place to ensure that services are being provided as stipulated in the service charters.
In private sector like Barclays bank of Kenya ltd, service monitoring gargets have been fixed closer to the cashiers where customer gives feedback on the service provided. Contrary to the private sector, public service accuracy must take into consideration social welfare, equity, equal opportunities, and fair distribution of public goods and services to all citizens. To test for accuracy of governmental endeavors one must examine how citizens feel when consuming public services.
A well-accepted method is to use satisfaction measures indicating the outcomes of certain activities and the acceptance of public administration actions as fruitful, contributive, equally shared among a vast population, and responding well to public needs (Rhodes, 1987). Performance evaluation is, therefore, a critical stage in the performance contracting process. It is based on the premise that what gets measured gets done. Performance evaluation assesses the extent to which public agencies have achieved the agreed performance targets.
Thomas and Palfrey (1996) conceive that citizens are the clients and main beneficiaries of public sector operation and thereby should be involved in every process of performance evaluation. In their study, responsiveness of the public sector to citizens’ demands is mentioned as an important part of performance control since it refers to the speed and accuracy with which a service provider replies to a request for action or for information. According to this definition, “Speed” can refer to the waiting time between citizens’ equests for action and the reply of the public agency whereas “Accuracy” means the extent to which the provider’s response is appropriate to the needs or wishes of the service user. Nonetheless, while speed is a relatively simple factor to measure, accuracy is a more complicated one. 2. 3Impact Evaluation Impact evaluation is an assessment of the impact of an intervention on final outputs. It assesses the changes in the well-being of individuals that can be attributed to a particular intervention, such as a project, program or policy.
The results agenda which is an ongoing debate has forced agencies to demonstrate that the money they spend is improving the lives of poor people, thereby increasing demand for impact evaluation. In the current environment, calls for increased aid spending are only credible if it can be shown that current spending is indeed contributing toward the attainment of the Millennium Development Goals and that evaluation tools in place are effective enough to track the flow of resources through various strata of government to determine how much of the originally allocated resources reach each level (Dehn, et al. , 2003).
Debates over impact evaluation reflect the more general debate over the relative roles of positivism and phenomenological methods in social research. Whilst positivism is a strong form of empiricism, phenomenological perspective, on the other hand, captures experiential content with a good degree of reliability. Participatory impact evaluation grew rapidly in the 1980s, and is still growing strong especially amongst non-governmental organizations. The proponents of the participatory approach are skeptical of the econometricians’ attempts to reduce the impact of complex social interventions to a single number.
But the econometricians reject analyses which fail to build on a well-designed sample of project and comparison groups which allow statements to be made with a degree of scientific confidence about the behavior of indicators with versus without the intervention (Gupta, 2002). Montgomery (1994) defines econometrics as a discipline which makes use of economic theory, mathematical tools and statistical theory in order to analyze the economic relationships. Dessler (2003) observed that good evaluations are almost invariably mixed method evaluations. Qualitative information informs both the design and interpretation of quantitative data.
He noted that many evaluations under-exploit qualitative methods, both in the techniques they use and the way in which analysis is undertaken. Field experience by members of the core evaluation team is an invaluable source of qualitative data which cannot be overlooked for good quality evaluations. Performance of a public enterprise can therefore be evaluated ex-post where the evaluation is based on selected criteria determined at the end of the performance period, or ex-ante where the firm’s performance is evaluated against a set of predetermined indicators.
In managing the performance of public sector institutions, it is important to consider the enterprise performance and the managerial performance at the same time. Enterprise performance is based on the observed overall performance of the public institution while managerial performance is the total enterprise performance adjusted for exogenous factors which are beyond the control of managers (Alford, 2000). The measurement of service delivery can represent a powerful mechanism for obtaining feedback from client to providers.
A better understanding of service delivery will enable policy makers to increase the efficiency and effectiveness with which resources are translated into welfare outcomes. Measures of service delivery represent a vehicle for holding service providers to account for the quality and quantity of services they provide. Impact evaluation, therefore, tackles one of the fundamental problems of evaluation as it aims to measure the key outcomes that may be attributed to an intervention (Amin, et al. 2008). In a study carried out by Akaranga (2008), it was revealed that all government ministries and state corporations in Kenya had formally implemented performance contracts. According to the study, there was clear evidence of improvement in income over expenditure as well as service delivery in the state corporations and government ministries. This is evidenced by results for financial year 2005/6 where majority of state corporations posted excesses of revenue over expenditure (GOK, 2006).
Akaranga argues that for it to have impact on the populace, the evaluation of this improved performance should be done not only by the government but also by the service users. The government needs therefore, to come up with evaluating tools which will bring to board other stakeholders. In some developing countries, like Uganda the government uses Public Expenditure Tracking System (PETS) to track the funding from central government up to service delivery points.
For example, a public expenditure tracking survey was carried out in 2002 to assess the effects of improved access to public information in Uganda. This was a replication of the 1996 survey, measuring the difference between the capitation grants disbursed by the central government and the resources actually received by the schools. The 1996 sample consisted of 250 schools, randomly drawn from 18 districts while a total of 218 schools were considered in 2002. Not all schools in the original sample could be resurveyed in 2002 due to security concerns.
Summary statistics indicate that schools which had received only 24 percent on average of the total yearly grant from the central government in 1995 received more than 80 percent in 2001 due to increased sensitization via a campaign in both print and electronic media. It is interesting to note that while median school received nothing in the mid-1990s; it received 82 percent of its entitlement in 2001. However, diversion is still a problem for many schools. On average, 20 percent of school entitlements do not reach the schools, and about 30 percent of schools receive less than two-thirds of their entitlements (Bjorkman, 2006).
It is clear from this survey that the increased prudence in the disbursement of funds to schools was occasioned by the sensitization campaign. It therefore calls for improvement in the instrument being used to track funds from the central and local government. After all the Public Expenditure Tracking System is just a tool for follow up on public expenditure. The framework of accountability described in the World Bank Development Report (2007) indicates that there is no direct accountability of service provider to consumer in situations in which the government takes responsibility for services in sectors such as health, education, water, lectricity and sanitation (World Bank, 2003). Instead, accountability travels by a long route and thus citizens influence policy makers who then exert pressure on providers. Tracking surveys if well utilized can, therefore, be a powerful tool for public expenditure in not only in the developing countries but also developed countries. 2. 4 The Effects of Performance Contracting The principle of performance contracting provides an original combination of increased operational autonomy in the field of service delivery and a better strategic control by the organization.
But what are the effects of such an increase of the operational autonomy on the internal management of the organization and its external relations? Performance contracting has a direct bearing on the productivity of the organization. This effect can be examined from four fronts: Human Resource Management, Financial Management and Cost Consciousness, Internal Organization and External Relations (Bouckaert, et al. , 1999). Human Resource Management The new personnel statutes have improved the performance of human resources management and increased the flexibility of allocating the right person to the right job.
The renewal of the mandate of members of the supervisory board and the management board being dependent on performance evaluation is a major change and may act as an important incentive. It is also expected that outstanding performance is rewarded through promotion, pay-increase or recognition. Although various performance contracts do not clearly spell out the pejorative measures taken against mediocre performance, it is assumed that the punishments are clear.
With the creation of affiliated companies with widespread contractual employment, there are increasing concerns about the legal position of the personnel and about the growing fragmentation of employment regimes. This may affect mobility between the different business units (GoK, 2005). Lings (2004) emphasizes the importance of human resource management when he pointed out that many researchers and employers neglect one important focus, the demand of internal employees, especially those who directly get in touch ith customers. Because the attitude and behaviour of employees interacting with customers would influence the feeling and behaviour of the customers when they get the service, it is quite important for managers to efficiently define and manage the way their employees provide the service in order to make sure that their attitude and behaviour are good for providing the service. In this study, Lings argues that if properly executed performance contracting has a significant positive effect on staff commitment and satisfaction.
The study through the evidence-based research results found that the company applying internal market orientation strategy viewpoint could benefit to promote the organization internal and external performance. Hence it could benefit the service industries to establish perfect human resources management strategy with marketing viewpoint, and maintain the value goals of continuous survival, high growth and high profit in practice. On the other hand, Slater (1999) reiterated that performance contracting if well executed may increase real speed in decision making and builds self-confidence in employees.
He reckons that bureaucracy which is a common feature in organizations that still rely on the management apparatus that had worked in the 1970s is terrified by speed and simplicity which are some of the essentials of the performance contracting. Shirley and Lixin (1997) add that before the performance contracts were put in place most governments were trying to run their state enterprises without any form of performance evaluation which made life difficult when appraising employee at the end of the performance period.
Nahavandi (2006) points out that outstanding performance should be rewarded through promotion, pay-increase or recognition which should be negotiated on signing the performance contract. He further speculates that those who adhere and fit the organizational culture and structure, as well as meet individual goals and objectives are much more likely to be promoted to top leadership positions as opposed to those who do not. This process could be true for almost any situation; those who naturally fit well into an organization’s mission and culture are more apt to be selected and rewarded in some fashion.
Financial Resource Management The use of performance-based contracts has induced an increased cost consciousness. The organisations have to develop cost-accounting systems and provide yearly financial statements. The information provided improves the government’s capacity to control the organisations’ financial practices. Up to this moment, there is no direct link between the purchased amount of services and the level of the budget. An extended audit is needed to establish the link between objectives, outputs and inputs.
However, the outlook on better budget estimates, based on an increased knowledge of real costs, is realistic. In some cases, transfers are corrected on the basis of achieved performance results such that a failure to meet performance targets results in a decrease of financial transfer to government. On the other hand, there is a positive financial return to the government in case performance results exceed set targets. These positive corrections are dependent, however, on developments of the overall budgetary position of the government and are therefore limited.
These remarks attenuate the real impact of the budget as an incentive. There is also a need to enhance the performance orientedness of the different financial management instruments (budgets, accounts and audits) and the coherency and consistency of these instruments. More coherence and consistency would mean that budget; accounts and audits are based on the same output and cost categories. Most organisations with contracts develop accrual and cost accounting but fail to use the resulting cost information in their budget estimates. Compliance audits remain more important than performance audits.
The theory of contracting suggests that to improve performance, performance contracts must not only reduce the information advantage that managers enjoy over owners but also must be motivated through rewards or penalties to achieve the contract’s targets. Shirley (1998) argues that the logic of performance contracts is persuasive, but the reality has been disappointing. She carried out two empirical studies – one analyzing the effect of such contracts on profitability and productivity in twelve companies in six countries and other examining statistically the correlation between erformance contracts and productivity in hundreds of state enterprises in China. The results showed that there was no evidence that performance contracts had improved efficiency. The first study analyzed the effects in monopoly enterprises (in water, electricity, telecommunications, oil and gas) in Ghana, India, the Republic of Korea, Mexico, the Philippines, and Senegal. It found no pattern of improvement associated with the performance contracts in productivity or profitability trends.
The second study used a much larger sample in manufacturing but in only one country, China. The results showed that the increasing use of performance contracts in China could not stem the fall in productivity amongst state enterprises. More important, the study found no robust, positive association between performance contracts and productivity. Moreover, a comparison of a sample of state enterprises that had signed performance contracts with a sample of firms that had not signed found that there was no significant difference between the two groups.
On the other hand, Martins (2000) in his empirical study on performance contracting in the human services affirms that several agencies that participated in the study had experienced improved performance. For, instance, the Oklahoma Community Rehabilitation Services Unit found that contractor’s costs per placement declined by 51 percent between 1992 and 1997, that the average number of months that clients spent on waiting lists decreased by 53 percent.
The North Carolina Division of Social Services increased the number of adaptations from 261 adoptions in Financial Year (FY) 1993-1996 to 364 and to 631 in FY 1997-1998. The Illinois Department of Children and Family Services increased the number of placements in its Relative Home Care caseload from 2,411 to 5,570 in its first year, and in the second year the placements reached 9,503. As a result the Relative Home Care caseload declined by 41 percent%. Internal Organization management
Moy (2005) in his final report to the Office of Financial Management which summarized the results of their literature search and state survey on the best practices and trends in performance contracting in a number of state and local agencies in Washington D. C. indicates that the use of performance contracts and the accompanying increase of operational autonomy had induced some developments in the internal structures of the agencies under study. A number of questions were sent to each of the seven selected agencies and the responses were quite interesting.
Three of the four states changed to performance based contracting to achieve better results. The study reveals that the implementation of performance based contracting ranges from state-wide, agency wide, to only within specific agency divisions or programs and that its impacts in each state agency varied, but including increased accountability for service delivery and deliverables and increased partnership between the contractor community and the state agency. The study further indicates that states agencies had defined performance as deliverables, outputs, outcomes, and effectiveness and efficiency, among others.
Improved External Relations With respect to changes in customer relations, new interfaces and instruments are installed, resulting in increased client-orientedness. Most state corporations and government ministries for example in Kenya now have functional customer care and public relations offices. These offices have acted as valuable instruments for introducing a client focus. However, the functioning of these offices is hampered, in some cases, by the insufficiency of financial and human resources (Brynaert, 1994).
Performance contracting has been instrumental in helping state corporations and government ministries to introduce instruments to monitor client satisfaction. Examples of such instruments are the client help desks in all government ministries, accessible complaint channeling via the internet and other avenues, and annual reporting of performance and challenges to the public (Bouckaert, Verhoest and De Corte, 1999). Performance based contracting has received mixed reactions as many people would like to know the performance implications of altering team composition, especially in the top management team.
Changes in top management teams are becoming more and more frequent due to poor organizational performance, mergers and acquisitions, and strategic reorientations (Leonard, 2001). This trend, in a way, reflects a desire to influence the performance of the firm by means of altering the composition of the top management team. According to upper echelon theory, this might be a feasible strategy since research has demonstrated a link between attributes of top management team members and firm performance (Hambrick & Mason, 1984).
Specifically, upper echelon theory argues that individual attributes influence the preferences and attitudes of top team members, as well as the resulting team dynamics. In turn, these affect the strategic choices managers make, and therefore, organizational outcomes (Finkelstein & Hambrick, 1996). This argument supports the importance of performance contracting in the sense that whenever there are changes at the top level, the incoming chief executive continues to work on the set performance targets. With respect to changes in customer relations, new interfaces and instruments are installed, resulting in increased client-orientedness.
Most state corporations and government ministries in Uganda, for instance, now have functional customer care and public relations offices. These offices have acted as valuable instruments for introducing a client focus. However, the functioning of these offices is hampered, in some cases, by the insufficiency of financial and human resources (Akaranga, 2008). In order to increase the reliability and validity of performance measurements, various approaches are recommended such as multiple raters, combination of objective and subjective criteria, and so on.
For instance, Bobko and Collela (1999) suggest that performance standards are external to the individual and for evaluative purpose and that it is different from individual goals as a person’s internal aim. They proposed the importance of the employee reaction and acceptance of performance standards. Similarly, Huber et al. (1999) suggested that performance standards should be clear and specific in order for raters to evaluate performance accurately using such standards. They however observed that the major concern was the kind of rating scales increase rating accuracy to be used. They suggested various ating scales among them behavioral anchored rating scale (BARS), behavioral observation scales, and other similar scales were proposed to increase the rating accuracy. SECTION III 3. 0Empirical Discussions 3. 1The Situation at Makerere University before Embracing Performance Contracts The days when Makerere was admiringly referred to as the Harvard of Africa were long gone. Makerere’s decay dovetailed with the decline of the country starting in the early 1970s. But even when the country started to pick up in the late 1980s, structural adjustment policies ensured a cut in government funding.
General poor management of the institution only made the situation worse. The University was characterized by numerous student and staff strikes and a decline in academic performance. (Tabaire, Okao. 2009). The following gave an account of the situation at Makerere University before embracing Performance contracts according to (Tabaire, Okao. 2009). Financial Performance/Management Financial performance is concerned with measuring the results of an organization’s policies and operations in monetary terms whereas financial management entails planning for the future of the organization to ensure a positive cash flow.
Makerere’s financial management challenges come from a lack of control structures and systems as well as running the university not as a revenue-generating entity but rather as an expenditure entity. The university lacked a business plan and that implied that there was no clear direction for raising revenue. A strategic plan without a clear business plan is largely impossible to execute. There has been elastic recruitment of administrative staff at the centre, which continued to increase the wage bill. For several years, the University had run a deficit budget and had domestic arrears of three years of about, Shs26 billion.
Also, processes in the University were extravagant and wasteful with too many administrators coupled with poor accounting by the staff in terms of who is doing what. Decision making at the University was too expensive because of too many allowances for the too many managerial committees that used to meet too many times. For example at the Faculty of Law, there was; setting allowance, marking allowance, teaching allowance, sitting allowance, auditing of marks allowance and examination’s allowance. On top of this, there was inadequate transparency and accountability. Research and Knowledge Management
Research and knowledge management refers to processes and systems that facilitate research and innovations, knowledge dissemination and retention. The research process at Makerere was not adequately managed, which partly explained why much of the students’ research work was lagging. Web-enabled research management tools are becoming very popular and the reason for their use is that they help research work to reach wider audiences and at the same time improve the visibility of the university. Yet Makerere lacked these tools making it difficult to manage research proc¬esses.
Google Scholar has millions of records on research and knowledge management but contained little from Makerere yet it was used in University rankings. The information on research being undertaken in the University and the level of funding was not known. The central administration only had infor¬mation on research funded by key development partners through insti¬tutional development programmes. Makerere has potential for a larger output of high quality research and publications but this was still limited by weak linkages with the private sec¬tor yet a lot of research elsewhere was funded by the private sector.
There was also little initiative/ability to source for research funding, and limited publicity of research accomplishments and on¬going initiatives through the Web and Internet media. Quality of Service Delivered Quality of services delivered such as processing of documents especially academic papers (testimonials, transcripts, certificates), and payment of suppliers left a lot to be desired. Students and the wider public had repeatedly expressed their dissatisfaction with service delivery at Makerere. The University did not have service level agreements to act as benchmarks for service delivery.
Registration of students was unnecessarily complicated. The quality of teaching and laboratory services was hampered by lack of state-of-the-art lecture theatres and laboratories. Most lecturers had no access to projectors and laptops. They still used chalk. They dictated notes in class instead of uploading them on online learning systems. Replies to communications within the University took weeks or months. Service delivery was hampered by lack of supportive ICT systems and poor ICT integration; lack of the right caliber of staff to provide services; inadequate appraisal system; and poor information management.
No one even seemed to know the exact number of students enrolled at the university. Service delivery was also affected by lack of staff motivation and retention mechanisms. In addition, there was the non-academic staff performing duties such as cleaning offices, halls of residence, collecting garbage, sweeping roads within the University. Their services were very crucial although the execution was not up to standards. Offices would go for weeks without being cleaned, garbage would accumulate at dump sites, halls of residence would host the dirtiest toilets and walls, and lecture rooms would stay very dirty and littered.
Management/Staff Relations There was lack of appropriate relationship between management and staff with every side claiming superiority. There was no strategy to retain staff supported by the University to advance their careers. Once these members of staff completed their studies there was no engagement to ensure that expectations on either side are adequately taken care of. The University lacked a reward and recognition mechanism for outstanding performance. There was a lot of intrigue at all levels. This was certainly detrimental to building a culture that is results-oriented.
Dependency on the grapevine (rumor) was ripe largely because the flow of information from those who had it was extremely difficult. Academic staff strikes had been mainly due to lack of dialogue and trust between the Academic Staff Association (MUASA) and the University management. On the other hand, the relationship between Administrative Staff and University Management came to climax when the Administrative Staff took the University Council to court over pay disputes. University/Student Relations Student leaders felt that they never had enough access to University Managers at the various levels.
Whenever there was dialogue with the University Officials, however, the Students felt that they were being lectured most of the time instead of being listened to. The Students Guild leadership had also persistently complained over lack of timely access to the money for Guild activities. Information on new policies affecting students gets to them late and at times the sensitization was not adequate. There were also student concerns over lack of appropriate avenues to seek redress in case of complaints; lack of assurance mechanisms with regard to delivery of services; and inappropriate facilities to foster ideal learning.
University Image and Standing The image and reputation of Makerere University were greatly affected by negative media reports mainly due to poor service delivery and lack of in¬formation dissemination. The University lacked a public relations strategy and thus the engagement with the public was ad hoc. The University website, which was supposed to be the main source of information to the media and general public both locally and internationally, was never regularly updated and as a re¬sult Makerere University web ranking by Webometrics was poor.
Lack of timely and accurate information had also been interpreted as lack of transparency, which contributed to the negative publicity. There was also the problem of poorly packaged in¬formation in form of annual reports and newsletters. There was lack of im¬pression management as well. For ex¬ample, the main gate area was shabby, and the entrance to the Main Building and facilities therein were in an appalling state. Governance Governance relates to decisions that define expectations, grant power, or verify performance. In some Faculties, departments operated as autonomous units without direction and supervision from the Faculty Dean.
At University level there was hardly any direction or supervision of Faculties by the Vice Chancellor and the Deputy Vice Chancellors. Within the Vice Chancellor’s Office the roles of the Vice Chancellor and the Deputy Vice Chancellors were not clear. 3. 2Introduction of Performance Contracts at Makerere University The crisis, which ran down Makerere University during the 1970s and 1980s, signaled the collapse of the University Grants Committee (UGC) model of planning higher education. The 1987 Donors Conference for Makerere
University recommended the establishment of the Planning and Development Department with mandate to revive and create awareness for systematic planning (Makerere University Strategic Plan, 2004). In 1992, the University embarked on the formulation of a five-year development plan that took three years to produce. In 1996/97 a three-year Strategic Plan was developed and it was adopted by Council to run for the period 1996/97-1998/99. After the adoption of the Terminal Review Report of the 1996/97- 1998/99 Strategic Plan, the University Council approved the formulation of the Strategic Plan 2000/1-2004/5.
The Strategic Framework defined strategic directions and broad parameters within which the 29 Planning Units (College/Faculty/School/ Institute as well as Administrative Departments) should formulate their plans. The process was highly participatory to capture the opportunity and generate momentum and commitment to strategic planning throughout the University (Makerere University Strategic Plan, 2004). It was during this period of strategic planning that recommendations for performance contracts were adopted.
Objectives for which Performance Contracts were adopted in Makerere University (Makerere University Strategic Plan, 2004) Performance contracts were adopted in Makerere University for improving service delivery to the public by ensuring that the University is accountable for results, reversing the decline in efficiency and ensuring that resources are focused on attainment of Key University policy priorities, institutionalizing performance oriented culture in the University through introduction of an objective performance appraisal system, measuring and evaluating performance, linking reward to measurable performance, facilitating the attainment of desired results, instilling accountability for results at the highest level in the University, ensuring that the culture of accountability pervades all levels of the University Structure and strengthening and clarifying the obligation required of the University and its employees in order to achieve agreed target. (Makerere University Strategic Plan, 2004) 3. The Effects of Performance Contracting in Makerere University Performance contracting has had a direct bearing on efficient and effective service delivery of Makerere University elaborated as follows; Human Resource Management /Staff Relations The new personnel statutes have improved the performance of human resources management and increased the flexibility of allocating the right person to the right job. The renewal of the mandate of members of the supervisory board and the management board being dependent on performance evaluation is a major change and acts as an important incentive. Following the introduction of performance contracts, statements from staff associations are tabled for discussion as one of the ways to foster dialogue and understanding within the University.
Also, chairpersons of staff associations are invited to attend end of the month management meetings; the Vice Chancellor ad¬dresses staff at their general meetings so that his address forms part of the discussion; there is a reward and recognition policy for outstand¬ing performance; plus introduction of an intrigue and conflict-resolution mechanism. Although various performance contracts do not clearly spell out the pejorative measures taken against mediocre performance, it is assumed that the punishments are clear. The personnel on contract in the University have demonstrated a high level of service delivery. The Vice Chancellor who is on contract has had various achievements in his tenure in Office.
He introduced Makerere University Public Relations and Communications Board (Annual Report, 2010) through which weekly press briefings are organized. This initiative has led to a favorable media coverage as well as creating awareness, understanding and appreciation of the developments at Makerere University. His unprecedented reforms have seen Makerere scale the rankings to being number 8 in the whole of Africa in web metrics rankings. It now beats all of them except seven world class universities in South Africa. Baryamureeba results-oriented approach hasn’t only reduced queues of transcript seeking students at the Academic registrar’s department but has also won him admirers amongst students and staff members.
Today the process for applying by S6 leavers (seeking admission) is much faster than it was five years ago. The computerization of fees payment and ID registration process has caused smiles on many students’ and staff members’ faces. Senate and council members appreciate that Baryamureeba has been able to achieve all these in his three years of acting. Council and Ministry of Education also appreciate the fact that it’s Baryamureeba and not anybody else that Makerere’ International development partners trust to deliver the desired academic and infrastructural reforms. He is not an angel but I have no dought that Baryamureeba is the best thing Makerere can currently find. He has a track record of great performance right from his days as Dean CIT.
He has beaten all odds to implement the College system which has decentralized decision making by empowering units. Under Baryamureeba’s leadership Makerere in January 2011 gave His Excellency Yoweri Museveni a honorary PhD in law. He has sourced funding which has enabled Makerere become more innovative as demonstrated in the Kiira EV car which Museveni personally funded. Because the attitude and behavior of employees interacting with customers would influence the feeling and behavior of the customers when they get the service, it is quite important for managers to efficiently define and manage the way their employees provide the service in order to make sure that their attitude and behavior are good for providing the service.
In this study, Lings argues that if properly executed performance contracting has a significant positive effect on staff commitment and satisfaction. The study through the evidence-based research results found that the company applying internal market orientation strategy viewpoint could benefit to promote the organization internal and external performance. Hence it could benefit the service industries to establish perfect human resources management strategy with marketing viewpoint, and maintain the value goals of continuous survival, high growth and high profit in practice. On the other hand, Slater (1999) reiterated that performance contracting if well executed may increase real speed in decision making and builds self-confidence in employees.
He reckons that bureaucracy which is a common feature in organizations that still rely on the management apparatus that had worked in the 1970s is terrified by speed and simplicity which are some of the essentials of the performance contracting. Shirley and Lixin (1997) add that before the performance contracts were put in place, most governments were trying to run their state enterprises without any form of performance evaluation which made life difficult when appraising employee at the end of the performance period. Nahavandi (2006) points out that outstanding performance should be rewarded through promotion, pay-increase or recognition which should be negotiated on signing the performance contract.
He further speculates that those who adhere and fit the organizational culture and structure, as well as meet individual goals and objectives are much more likely to be promoted to top leadership positions – as opposed to those who do not. This process could be true for almost any situation; those who naturally fit well into an organization’s mission and culture are more apt to be selected and rewarded in some fashion. Financial Performance The use of performance-based contracts has induced an increased cost consciousness in the University. There has been remarked reduction of waste and at the same time being innovative in generating money. The acting Vice Chancellors efficiency plan entails, among others, automating financial management to enable the enforcement of budget line performance and generation of financial information to ensure transparency.
The University Bursar to date is able to control finances through FINIS. This programme has increased financial truck record and reduced on forgeries. At 2,400 courses, a curriculum was revised and the 27 faculties have been collapsed into seven colleges with a bid to cut on the costs of operation. The University has increased on the amount of money it generates internally by launching University learning centers country wide to run certificate, diploma, and bachelor’s degree programmes. Instead of erecting buildings, Makerere rents space in order to manage costs. Campus FM has been revamped with two components – a commercial arm and a training arm.
The University has also developed its idle land, renovated its houses in the upscale Kololo neighborhood of Kampala and plans to rent them out at market rates, appealed to alumni for donations, allowed companies to advertise in form of screen savers on University computers, and gotten its academic staff to research and publish more to raise the University’s rankings and thereby attract more funding. There has been support for incubation centers in things like software engineering and food science and technology that run as commercial businesses following the research and development model. There is also the idea of establishing a commercial zone at the main campus by renovating the existing structures so that spaces can be rented out to businesses such as banks, bookstores, telecoms, food and coffee shops.
These remarks attenuate the real impact of budgeting as an incentive to Makerere University. There is also enhancement on the performance orientedness of the different financial management instruments (budgets, accounts and audits) and the coherency and consistency of these instruments. More coherence and consistency would mean that budget; accounts and audits are based on the same output and cost categories. The theory of contracting suggests that to improve performance, performance contracts must not only reduce the information advantage that managers enjoy over owners but also must be motivated through rewards or penalties to achieve the contract’s targets. Research and Knowledge Management
An integrated system that provides a central point of contact on research issues was developed; encouraging staff to start websites (to carry information on their research and publications), something that is integral to their appraisal; developing a project management system that provides updated information on every project managed by Makerere; and ensuring that all scholarly work and reports are uploaded in Google Scholar and other important databases has been realized. During his term in Office, the Ag. Vice Chancellor has made several efforts to upload information on research, publications, innovations and critical developments at the University which has improved the online presence and visibility of Makerere University.
As a result, Makerere University’s Webometrics ranking of the top 100 Universities in Africa rose from 15th position in January 2010 to the 13th Position in July 2010. To date (January, 2012) university ranking by academic performance (URAP) Research Laboratory, Turkey ranked Makerere University 8th out of 59 Higher Education Institutions (HEIs) in 18 African countries and in position 802 worldwide. This was because of its improved number of articles (current, scientific & productivity), Citation (Research Impact), Cumulative Journal Impact (Scientific Impact), H-Index (Research Quality), International Collaboration (International Acceptance), and Google Scholar Results (Long – Term Overall Productivity). (Press release, Tuesday, January 03, 2012, Office of the Vice-Chancellor Public relations office).
The ranking came almost 6 months after the transition of Makerere University from a faculty-based to a collegiate University on 1st July 2011, which witnessed the review of the research function. Makerere University through its partners embarked on various development projects. A major breakthrough is the “KIIRA-EV” project, Uganda’s first electric Car. The project was made possible because its proponents Musasizi and Prof Tickodri who was then teaching engineering mathematics wanted to show results after signing several performance contracts with the university and the government. (The Weekly Observer Sunday, 06 November 2011) Quality of Service Delivered
With the embracement of performance contracts, there is a promise of re-training staff, creation of a one-stop information centre (office), and an online information portal for providing information; automate service delivery (including student payments, registration, and requests) so that paper work is reduced and the status is monitored online; and development of a voice over the Internet system to enable savings on calls made within the university has been made. All these aspects require ICT knowledge. There was, therefore, a system for staff to acquire laptops/computers under a hire purchase scheme, and to get e-learning training. Students are helped to own laptops under a student laptop loan scheme.
Williams (2004) points out that performance contract have been viewed as a management process that is supposed to improve quality of service delivered. In addition, there have been ground breaking developments in-terms of service delivery at AR’s office. The Academic Registrar’s Office has had the registration system of students put online since January 2010. Students can register on line, review their results and financial statements as well. The students who graduated in 2010 were able to get their academic transcripts immediately after the graduation. To date, academic transcripts and certificates can be accessed before the graduation function. The University has contracted several private companies to handle construction, cleaning, printing Identity cards and provision of supplies.
To date, offices are cleaned by a contractor Safi Cleaning Services, University compounds are cleaned by Mop Cleaning Services and garbage is being managed by NUSONIC Ltd, and supplies are provided by contractors. The University Librarian embarked on a system of putting the Library materials on line. University library material can be accessed from anywhere on intranet/internet. There is improved service delivery for library users and college/faculty book banks. The Library catalogue is accessible online for quick and fast searches of material. University/Student Relations There has been a plan that ensures that guild money is transferred as approved and in a timely manner.
Also, for every regular Council and Senate meetings, a statement from the leadership of Makerere University Students Guild is tabled for discussion; the Guild president is invited to table a statement at the management meeting every month; and at every Guild Assembly, the vice chancellor or the deputy for academic affairs addresses the Guild Representative Council (student parliament) so that the address forms part of the discussion. Furthermore, the university intends to have modern hostels constructed on campus to check the continuing proliferation of usually sub-standard hostels around the university. And, in change of policy, the university will house only first-year students. University Image and Standing
There has been centralization of all advertising and entering into conditional advertising contracts; strengthening the public and corporate relations function; using staff to promote and advertise the university; and issuing weekly press releases and briefs. In terms of impression management, the main entrance to the university was reconstructed with better signage. The same goes for the main entrance to the Main Building. More gates were constructed, and persons selling newspapers and the kiosks along University Road relocated. To check the forging of certificates the university contracted a new company that issues certificates with watermarks and other ecurity features. Governance Internal reporting guidelines have been developed, amongst other strategies for change. All relevant Council and Senate decisions and policies are put on the intranet to be accessible by all authorized staff; deans submit quarterly reports to top university management and these are automated to enable ease of report generation; performance-based appraisal system has been institutionalized with key performance indicators forming the basis for appraisal. 3. 4Conclusion Performance contracting as an implementing tool in strategic planning is of great importance under the New Public Administration at Makerere University.
There is, however, need for a good definition of outputs and solid performance measures which will be able to promote Makerere’s internal performance through a well customer-oriented ability of employees to further promote its external performance. This requires a well-defined training program for the University Staff to support implementation of performance contracting. On the other hand, there is need to study both the University’s perceptions on the role of performance contracting in improving service delivery to the end users and also the impact of the performance contracting on service delivery to the populace. This confirms achievement of objectives of implementing performance contracting in Makerere University. 3. 5Recommendations Following the study findings, the researcher recommends as follows.
Stability and availability of resources is vital for the success of performance Contracting and therefore the University top leadership must ensure that necessary resources are available at all time. The top management of the University should respect the operational autonomy of contracted organizations for efficient and effective service delivery. Knowledge of strategic planning, its development and monitoring capacities among the staff is central to success of performance contracting and the management support and their technical knowledge is vital; Makerere University requires repositioning itself towards achievement of these values. Contract management should be accompanied by performance-oriented change in the structure and management culture of the University.
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ABSTRACT Extreme and major changes are increasingly occurring in the environment in which public institutions operate. An obvious manifestation of the responses towards this turbulent environment is the introduction of performance contracting in Makerere University as part of the broader public sector reforms aimed at improving efficiency and effectiveness in management. The main objective of this paper was to look at a critical review of performance contracting in public institutions. The scope of the study was limited to Makerere University and the impact of performance contracts on service.