Document Library

On Public Organizations in Ghana: What Differentiates Good Performers from Poor Performers?

Author: F Owusu
Date: 2006
Size: 15 pages (86 KB)

Access full text: available online

Summary

Are there significant differences in the characteristics of poor and good performing public organisations? What are the implications for public sector reform policy in Africa? This paper from the Department of Community and Regional Planning at Iowa State Universityuses Ghana as a case study to provide guidance to policymakers on ways of creating effective and efficient public sector reform strategies.

The World Bank’s ‘first’ and ‘second’ generation reforms assumed that all public organizations were inefficient and tended to be applied across the board. Lessons from organisations that have performed effectively under the same social, political, economic and institutional conditions have thus been ignored. Yet good performing organisations are found to be different in two respects: remuneration and hiring criteria. In order to improve performance, the government needs to boost salaries in poor performing organisations. The management of these organisations should employ open and competitive recruitment procedures.

By the mid-1980s, the public sector in Ghana was in disarray. As a result, the government implemented a version of the World Bank’s ‘first’ and ‘second’ generation reforms:

The aim of the first generation reforms was to trim the size of the government. Although these policies helped reduce government wage bills in some cases, overall they failed to improve the performance of the public sector because of their narrow focus.
In Ghana, the first comprehensive public sector reform programme successfully reduced the number of civil servants in central government. However, the overall effect in terms of efficiency gains was mixed, due to its narrow focus and the lack of government commitment.
The World Bank’s second generation reforms focused on improving the quality of public sector employment through remuneration and promotion policies and measures to improve management and accountability. These policies also generally failed to produce the desired results.
In 1994, the Ghanaian government focussed on enhancing efficiency and facilitating the development of a proactive and motivated public sector. Overall little progress was made due to lack of political will in government.
As at August 2005, the government of Ghana was in the process of developing a new public sector reform strategy. Although this is yet to be articulated, these policies are expected to resemble the World Bank’s ‘service delivery’ third generation reforms.

This case study used the reputational method for selecting organisations and measuring their performance. The factors that affect performance of the public sector can be broadly classified as internal and external:

External factors were: the incentive system, specificity of tasks, political interference and client demand and oversight.
Internal factors were: organisational mission, recruitment criteria, performance expectation and evaluations and employee sanctioning and autonomy.
Among the external factors, the only measure that showed significant differences between good and poor performers is the incentive system. Remuneration is higher in good performing organizations than poor performing ones.
With regard to the internal factors, only recruitment criteria was significantly different among the two groups. Employees in poor performing institutions were more often hired based on personal connections.

Access full text: available online

Source: Owusu, F., 2006, 'On Public Organizations in Ghana: What Differentiates Good Performers from Poor Performers?', African Development Review, vol.18, no. 3, pp. 471-485
Author: Francis Owusu , fowusu@iastate.edu