n this era of accountability,
local public sector managers
and officials must be prepared to answer
questions regarding how well a governmental organization
is meeting the needs of its citizens and providing
services to the community. Benchmarking and performance
measurement are methods that can provide valid information
to answer these questions. Using these management
tools can be a daunting task for an organization to
undertake alone.
This
article describes the South Carolina Municipal Benchmarking
Project (SCMBP), a collaborative approach in which
municipalities are benchmarking their performance
in key service areas. More specifically, this article
discusses the purpose and background of the SCMBP.
It also provides a discussion of the project’s
structure namely its governing, process, and staffing
units, which have been invaluable to SCMBP’s
functioning and successes to date. With this, a detailed
discussion of the SCMBP’s service areas and measures
will follow. Finally, the project’s status will
be touched upon highlighting key project implementation
issues and strategies to date.First, however, a quick
examination of the term of “benchmarking”
will provide the context within which the South Carolina
project was undertaken.
WHAT
IS BENCHMARKING?
Benchmarking,
originally simply a geodetic term that designated
a reference point for surveying purposes, became additionally
a business term (and process) in the late 1970s. In
the early 1980s, for example, Xerox Corporation became
one of the first companies to use the new terminology
extensively to designate its innovative approach to
quality management and performance measurement. Xerox
used benchmarking, according to former CEO David Kearns,
as “the continuous process of measuring products,
services, and practices against the toughest competitors
or those companies recognized as industry leaders”
(Bogan and English, 1994, p. 4).
As benchmarking
has made strides over the past two decades in business
and industry, it has been adapted by the public sector
as well. For instance, beginning in 1991, benchmarking
techniques were built into the National Malcolm Baldrige
Award process and have been expanded to not only cover
corporate entities but also the public sectors of
education and health, by federal statutes, in 1997
(NIST, 2002, p. 18). States like Oregon, Minnesota,
Texas, and many others have also adapted benchmarking
practices to improve their performance and service
delivery areas. While borrowing benchmarking concepts
and approaches from corporations as well as other
states, each state has utilized methods that are unique
and appropriate to its own cultures, economies and
politics.
Many local
governments have also actively pursued benchmarking
to enhance their performance. For example, the local
governments of Arlington, Texas, Reno, Nevada, and
Salt Lake City, Utah have used corporate-style benchmarking
methods (Ammons, 1998, p. 31). In 1995, the Local
Government Performance Measurement Project, a joint
project of the North Carolina Local Government Budget
Association and the UNC-Chapel Hill Institute of Government,
developed a model for its counties and cities to assess
performance, particularly quality of services and
cost-effectiveness. It is of interest to note that
the benchmarking process used in the North Carolina
project, similar to the benchmarking project in South
Carolina, is oriented less to a corporate-style approach
(or world-class, best practices methodology) but focuses
rather on an approach that emphasizes comparisons
among the performances (statistics) of participating
counties and cities.
According to
Ammons (1998), benchmarking in the public sector can
take on three differing connotations. These are
corporate-style
benchmarking;
targets
as benchmarks; and,
comparison
of performance statistics as benchmarks. (p. 2).
Corporate-style
benchmarking is what Dutile (1993, p. 6) refers to
as the “generic” form of benchmarking. It
equates basically to looking at industry “best
practices” (i.e., processes, products, and/or
services) and “copying” or adapting them
to fit one’s own organization.
A second form
of benchmarking involves “targeting.” This
is the process of the setting of goals and objectives
to be achieved generally through strategic planning
actions. Oregon Benchmarks (http://www.econ.state.or.us/opb/index.htm)
and Minnesota Milestones (http://www.mnplan.state.mn.us/mm/)
are good examples of this sort of benchmarking style.
Essentially, present conditions (local or statewide)
are analyzed and then compared to some target or condition
in the future (vision) that is desired.
The third and
final connotation of benchmarking is what Ammons (1998)
calls “comparison of performance statistics as
benchmarks” (p. 4). In this form of benchmarking,
organizations -- for example cities or counties --
partner with other similar, designated organizations
and identify what services are to be benchmarked (e.g.,
police services, fire services, etc.). Once a set
or number of services is chosen, benchmarks are determined
(e.g., response times) and data or statistics are
gathered to create a baseline. Once a solid database
is in place, established over a set period of time,
multi-jurisdictional or organizational comparisons
are made. Statistical differences are then identified
and potential reasons for these differences are scrutinized
in an attempt to understand these variations and to
identify ways to improve these measures.
The South Carolina
Municipal Benchmarking Project falls most appropriately
into this third definitional type. Currently, this
project provides a forum for South Carolina's cities
of varying sizes to share performance (statistical)
information on three service areas: police, fire,
and solid waste services.
PURPOSE
AND BACKGROUND OF THE
SOUTH CAROLINA MUNICIPAL BENCHMARKING PROJECT
As David Ammons
has noted, “A big part of the service delivery
challenge to local governments is providing desired
services at affordable costs. The other part of the
challenge lies in reassuring local taxpayers that
their resources have been well spent. Good performance
measures and the appropriate use of benchmarks can
help on both counts” (Ammons, 1997, p. 11).
The SCMBP is an attempt to help municipalities in
South Carolina address both of these challenges.
While many
South Carolina cities are small by comparison, the
state has benefited from the progressive interests
of key municipal managers, administrators, mayors
and councilpersons who have urged their organizations
toward performance improvement. The challenge begins
when comparable or statistical benchmarks are not
readily available. In order to maximize the return
on the investment required and to create an effective
benchmarking system, a collaborative approach to identifying
measures and determining target norms is most beneficial
and cost effective.
In 1996, the
University of South Carolina’s Institute for
Public Service and Policy Research’s Center for
Governmental Services, with seed money from the Municipal
Association of South Carolina, began a pilot project
to provide municipalities in South Carolina with a
means to easily compare performance data on municipal
services. The purpose was not only to assist cities
in setting targets, but also to highlight the progressive
cities that might be able to share their secrets to
improved performance. While data itself is important,
another vital by-product of the collective benchmarking
effort was directed towards the networking and information
sharing between city managers and service managers
alike as they jointly worked to solve service delivery
challenges.
During June
1996, eleven cities were asked to participate in the
pilot phase of the SCMBP based on demographic representation
across the state, interest in measuring organizational
performance, and their demonstrated leadership abilities
in encouraging and sustaining organizational participation
in such a project. With the technical assistance of
the Center for Governmental Services, the cities of
Aiken, Anderson, Clemson, Florence, Georgetown, Myrtle
Beach, North Augusta, Orangeburg, Rock Hill, Spartanburg,
and Walterboro agreed to commit their resources to
the three-year pilot project and work to accomplish
the following:
To
develop a standard set of performance measures for
three key services and define consistent data retrieval
methods;
To
develop a standard costing methodology for each
service area;
To
develop and implement a standardized customer survey
instrument to collect quality measurement information;
To
create a common list of profile factors such as
level of service, method of service delivery, and
other information that should be considered when
comparing performance and cost statistics; and,
To
create a training component for the second phase
of the project when additional municipalities would
be invited to participate.
PROJECT STRUCTURE
Careful consideration
was given to how the project would be staffed and structured.
The following factors were deemed crucial for the successful
implementation of the project:
To
encourage cities to create a system that serves
their needs;
To
create a partnership between the city managers/administrators
and the service managers to ensure continuous participation
in the project;
To
create standard measures and retrieval methods that
would protect the integrity of the information;
and,
To
create a support system of staff and resources that
would assist each city in its benchmarking efforts.
The SCMBP is
structured according to the following committees:
Steering Committee, Finance Committee and service
committees for each service area. Staff members from
the Center for Governmental Services serve as project
managers and provide facilitative and operational
support to the project. Specifically, center staff
resources are used to develop the project model, facilitate
meetings, coordinate logistics, collect data, develop
the database, publish reports, and assist participants
in the analysis and utilization of the benchmarking
results.
Steering
Committee
The
Steering Committee is composed of the city managers
and administrators from the participating municipalities.
The primary purpose of the Steering Committee is to
provide leadership and direction for the project as
well as ensure full participation from staff serving
on the service committees. Responsibilities of the committee
are summarized below:
Selection
of core services to be included in the project;
Identification
of one representative from each city with related
technical expertise to serve on each of the service
committees;
Final
approval of all performance measurement and profile
information to be included in the system;
Determination
of reporting formats and methods for distributing
performance information;
Development
of policies related to future participation in the
expanded project; and,
Ensuring
that the data submitted from their jurisdictions
are accurate.
Finance
Committee
The structure
and purpose of the Finance Committee has evolved since
the pilot phase of the project. The original membership
consisted of select city finance officers who served
as resources to the Steering Committee. The primary
charge to the Finance Committee was to develop the
cost accounting model for the project and to identify
potential vendors to provide this service for participating
cities. The committee membership has since been expanded
to include finance directors/officers from each of
the participating jurisdictions. The major functions
of the committee are listed below:
Assist
service committees in designing cost measures;
Develop
and coordinate a consistent indirect costing methodology;
Work
jointly with their department managers in calculating
the direct cost data for their departments; and,
Work
collaboratively with a vendor on conducting an indirect
cost plan or calculate the indirect cost data internally
by following the guidelines established by the committee.
Service
Committees
The service
committees are designed to provide expertise and buy-in
from the managers who would most likely be positioned
to implement the changes and improvements that commonly
occur from benchmarking performance. The service committee
members’ major tasks are:
Develop
profile
factors related to the service area
(e.g., functions performed, collection method, etc.);
Develop
standard performance
measures for Steering Committee approval;
Collect
and submit performance measurement data for their
department as defined by the committee;
Serve
as peer reviewers of the data;
Analyze
the performance of their department; and,
Seek
out the best practices for their service and ways
to adapt these to their departments.
SELECTION
OF PROJECT SERVICE AREAS AND MEASURES
Governmental
officials are increasingly asking hard questions such
as: Are the services provided meeting the needs and
expectations of its stakeholders and are they positively
addressing the problems they were designed to address?
Are they achieving the established goals? What are
the true costs of providing these services? How do
the services provided measure up against those provided
by other governments or other sectors? Are services
improving? Performance measurement is essential to
answering these questions with more than anecdotal
information.
There are a
variety of ways to categorize performance measures.
Ammons suggests the use of four broad categories:
workload measures, efficiency measures, effectiveness
measures, and productivity measures (Ammons, 1995,
p. 18). Counterparts at the Institute of Government
at the University of North Carolina at Chapel Hill
use the following categorization in the North Carolina
Local Government Performance Measurement Project:
resource measures, activity measures, output measures,
need or demand indicators, outcome measures, efficiency
measures, and effectiveness measures (Few and Voght,
1998, p. 46). Mark Glover with the Innovations Group
identifies input, output, efficiency, productivity,
and effectiveness or outcome measures (Glover, n.d.).
Since the focus
of this article is on the South Carolina Municipal
Benchmarking Project, we will use the categories and
definitions used in the project. The following types
of measures are employed in this project: profile,
input, output, outcome, efficiency, and quality.
Profile
measures:
Operational information that can explain differences
in performance (e.g., service population, number
of fire stations, collection frequency, etc.).
Input
measures: Resources devoted to the delivery
of the service (e.g., full-time employees, operating
expenses, potential customers, etc.). Input measures
are not very useful by themselves but serve as building
blocks for more meaningful measures such as efficiency
measures.
Output
measures: Amount of products or service delivered
or level of activity in providing a particular program
(e.g., number of crime prevention programs, number
of fire prevention class attendees, etc.). Output
measures are somewhat limited since they do not reveal
whether the program goals have been accomplished,
nor do they give any indication about the quality
or efficiency of the service or program.
Outcome
measures: Impact of the service on the problem
or condition being addressed. These measures reflect
the actual results achieved and the benefits of the
program (e.g., percentage of waste reduction in the
garbage stream, fire dollar loss, etc.).
Efficiency
measures: How well the resources are used to provide
the service or program. These are generally expressed
in a ratio between inputs and outputs (e.g., number
of residential garbage tons collected per FTE, total
cost for police services per 1,000 service area population,
etc.).
Quality
measures: How well is the service meeting the
needs and expectations of customers and stakeholders
(e.g., percentage of citizens who indicate they are
satisfied with fire services, percentage of citizens
who indicate they feel safe or very safe in their
neighborhood at night, etc.).
Project
Service Selection
After
much discussion and debate, the project's Steering
Committee decided to focus on police, fire and solid
waste services for the pilot phase. As is the case
in many jurisdictions, the majority of the municipal
budget is dedicated to these three service areas.
Since benchmarking can be an expensive and time consuming
endeavor, even for larger cities, it is important
to maximize efforts by selecting those services that
have greater opportunity for improvement.
While four
of the cities have public safety operations, the service
committee members decided to keep fire and police
services separate and ensure that the public safety
cities were represented on each committee. This structure
allows comparisons between traditional fire and police
services and public safety operations by keeping the
overall measures as similar as possible while controlling
for differences in the nature of the two operational
structures.
An immediate
discovery in the process was that there are several
components to these services and not all cities define
them or deliver services in a similar manner. When
benchmarking, it is imperative that all services and
measures be fully defined to avoid erroneous comparisons.
Since there will always be differences among organizations,
each service committee took on the task of creating
a service profile for its area to help delineate some
of the uniqueness. The committee members also crafted
a definition for each in order for all parties to
better understand the service areas. Listed below
is an example of the police service profile measures
and descriptions, followed by the service area definitions.
(For a complete listing of the performance measures
that are included in the SCMBP, please visit www.iopa.sc.edu/cfg/Benchmark/index.html.)
Police
Profile Measures and Service Descriptions
City
A
City
B
City
C
City
D
City
E*
City
F*
Service
Area Population
71,539
33,500
75,000
45,000
51,000
43,479
Service
Area Square Miles
13
16.8
22
26
9.5
19.25
Total
Sworn
Full-Time Officers
81
99
179
103
67
142
*Cities
have Public Safety Departments
Police
Patrol
- The deployment of officers to repress and prevent
criminal activities, investigate offenses, apprehend
offenders, and furnish day to day law enforcement
services to the community.
Criminal
Investigation - Acceptable practices and methods
in the development of information, conduction of interviews
and interrogations, collection and preservation of
physical evidence, and execution of background investigations
and surveillance as they relate to police operations
surrounding a crime.
Crime Prevention
- The aversion of illegal activities through proactive
programs, which address community perceptions or misperceptions
of crime along with analysis of local crime data.
9-1-1 Communications
and Dispatch - The component that satisfies the
immediate information needs of the law enforcement
agency in the course of its normal daily activities
and during emergencies.
Victim/Witness
Advocacy Program - The program is designed to assist victims and witnesses
involved in crimes. The victim advocate may be sworn
or non-sworn agency members or unpaid, citizen volunteers.
Balanced
Set of Measures
Measuring
spending is not enough. As Robert Behn has pointed out,
“Expenditures are only inputs. What really counts
are outputs and outcomes – or, even better, comparison
of how many inputs it took to produce how many outputs
and what kinds of outcomes.” “At best,”
he continues, “spending measures only commitment.
It completely ignores effectiveness” (Behn, 1994,
p. 4). To grade government we need to go beyond measures
of commitment such as input measures to measures that
get closer to addressing the purposes and expectations
of governmental services and programs.
Having a balanced
set of measurement information was one of the major
goals agreed to at the onset of the South Carolina
Municipal Benchmarking Project. Once the service areas
were identified, the service committees began developing
a standard set of measures. In order to achieve this
balance of indicators, the members were encouraged
to identify measures from the categories that have
previously been described: input, output, outcome,
efficiency, and quality. The committees reviewed measures
that had been developed from the North Carolina Performance
Measurement Project, largely so that municipalities
would have the option to benchmark across state lines
if they had similar sets of measurement data.
Since interstate
benchmarking was a secondary goal, the project allowed
committees to refine or develop new measures to address
the service delivery challenges and financial reporting
uniqueness of South Carolina. The original purpose
of asking service managers to develop measures was
so that they would "buy in" to the measures'
usefulness and be willing to collect the information.
It is always better to measure a few key areas well
than to measure everything and not use the information.
Once the cities began collecting data, several measures
were either altered or eliminated due to collection
costs or the questionable utility of the information.
Performance
data (police) from a select group of the larger municipalities
for the key measures is displayed in the following
table. This information represents fiscal year 2000
data. This information is also available at (www.iopa.sc.edu/cfg/Benchmark/index.html.)
Police
Performance Measures
CITY
A
CITY
B
CITY
C
CITY
D
CITY
E*
CITY
F*
INPUT
MEASURES
Total
Cost for Police Services
per 1,000 Service Population
$75,293
$146,202
$149,144
$136,849
$94,923
$207,730
Full
Time Sworn Officers per 1,000 Service Population
1.13
2.96
2.39
2.29
1.31
3.27
OUTPUT
MEASURES
Number
of Calls for Police Patrol Services per 1,000
Service Population
458.1
1,436.1
1,049.7
777.8
732.2
1,598.0
Number
of Traffic Violations per 1,000 Service Population
49.9
225.9
142.9
96.9
66.4
250.2
OUTCOME
MEASURES
UCR
Part I Crimes Cleared
19.75%
20.07%
7.11%
20.79%
24.95%
20.42%
EFFICIENCY
MEASURES
Average
Response Time from Time Call Received until Time
Unit Arrives on Scene (minutes and seconds)
4:13
4:00
2:46
Not
Available
4:03
4:29
QUALITY
MEASURES
Citizen
Responses to Quality of Police Services Provided
by City:
Excellent
19.7%
24.1%
20.5%
12.8%
27.5%
16.4%
Good
50.3%
52.4%
56%
55.7%
56.2%
58.6%
Fair
20.7%
18%
17.5%
24%
9.5%
18.3%
Poor
5.9%
5.5%
3.7%
4.8%
4.7%
6%
Very
Poor
3.5%
0%
2.3%
2.7%
2.1%
.6%
Citizen
Responses to How Safe They Feel Alone in Neighborhood
at Night:
Very
Safe
32.6%
37.5%
34.0%
31.0%
47.0%
32.6%
Somewhat
Safe
48.0%
53.6%
46.8%
47.6%
39.5%
45.9%
Somewhat
Unsafe
12.7%
7.4%
13.2%
12.4%
10.2%
13.3%
Very
Unsafe
6.7%
1.5%
6.0%
9.1%
3.3%
8.2%
*Cities
have Public Safety Departments
Standardized
Quality Measures
Most organizations
rely on customer complaints to evaluate the quality
of their services or products. One problem with this
method of data collection is that it can be skewed
tremendously by "overzealous" citizens.
The Steering Committee wanted to take a proactive
approach to gauging how well their services meet the
needs of their citizens. In order to ensure a consistent
data collection methodology, the members agreed to
contract with the University of South Carolina's Institute
for Public Service and Policy Research's Survey Research
Laboratory to develop and conduct a telephone survey
with a representative sample of citizens in each participating
city.
The Survey
Research Laboratory staff met with each service committee
and the Steering Committee to develop measures that
would effectively monitor how citizens felt about
the three service areas, as well as the city overall.
Cities were also given the opportunity to include
additional questions that could provide feedback on
unique issues facing the city. Professionally trained
interviewers conducted interviews with approximately
200 citizens in each participating city.
Once the quality
data were collected, the Steering Committee decided
to develop rating categories for each question so
that municipalities could rank their results against
each other, but also against their past performance.
A key principle to keep in mind is that a collaborative
benchmarking system will always rank someone at the
top and someone at the bottom, and this can be a potentially
acute problem when the number of benchmarking partners
is relatively small. This type of forced ranking can
produce false perceptions of performance, especially
among citizens. Rather than focus on the ranking for
the quality measures, the Steering Committee created
categories of performance and each city was categorized
according to its score.
Cost
Accounting Methodology
In today’s
society, taxpayers are interested in evaluating
the “value” of their tax dollar. Unfortunately
our traditional method of comparing cost information
across jurisdictions has been to calculate the “total
cost per capita.” This method can provide a
skewed perspective to an interested citizen wanting
to evaluate the efficiency of his/her city’s
services. Since smaller jurisdictions usually serve
a smaller population, the cost per unit of service
will most likely be higher than that of their larger
counterparts.
The project’s
Steering Committee wrestled with these issues and
decided to develop a standard costing methodology
that included both direct and indirect costs. The
indirect cost plan identifies costs that are directly
related to the service being evaluated as well as
that service’s share of central support services.
The resulting information can assist a jurisdiction
in setting fees, determining utility fund charge-backs
to the general fund for related support services,
collecting indirect costs related to grants and
evaluating privatization or out-sourcing options.
Given the
complexity of conducting an indirect cost plan and
the need for consistency across jurisdictions, a
vast majority of the pilot phase cities contracted
with a vendor for this service. Since the pilot
phase more of the cities have begun using an indirect
costing software program to calculate this information
internally. If a city chooses to use finance staff
to calculate this information, the finance department
is asked to provide supporting documentation showing
that they have followed the established costing
methodology. In an effort to reduce costs for participants
and given the fact that results would not change
substantially every year, the Steering Committee
decided to conduct the indirect cost plans and quality
surveys on a biennial basis.
PROJECT
STATUS
Phase I of
the Benchmarking Project, which focused on the development
of service measures and creating methodologies, was
successfully completed in the spring of 1999. At that
time, the Steering Committee decided to open the project
to all interested cities with a population of 5,000
or greater. This population size was chosen based
on the level of resource commitment (money and staff
time) that it had required from the pilot phase participants.
Rather than branch out into developing measures for
new service areas, the Committee decided to continue
collecting data on the police, fire and solid waste
services and to complete a database system to manage
all of the data. In a strategic direction meeting
in the fall of 2001, the Steering Committee decided
to add parks and recreation as a new service area.
A service committee has since been formed and is currently
in the collecting and testing phases of performance
data. Project staff at the Center for Governmental
Services has spent the last year focusing on how the
performance measurement results are being and can
be used by the participating cities. At the end of
this year's project cycle, staff will be better equipped
to assist the participating organizations realize
the tangible impacts this benchmarking initiative
can have on their operations and communities.
There are
currently seventeen (17) participating municipalities.
They are: Aiken, Anderson, Beaufort, Clemson, Columbia,
Florence, Georgetown, Goose Creek, Lancaster, Mount
Pleasant, Myrtle Beach, North Augusta, North Myrtle
Beach, Orangeburg, Rock Hill, Sumter, and York.
IMPLEMENTATION
ISSUES AND STRATEGIES
Undertaking
a benchmarking project of this magnitude does not come
without challenges. Summarized below are some of the
issues that the project staff has faced in the implementation
of this project and the strategies that have been employed.
"You
can't measure what my department does." "We're
too different to compare with other jurisdictions."
These comments are ones that the project staff has
heard on occasion from service managers. The Steering
Committee members were strongly encouraged to appoint
representatives to the service committees who were
positioned in the departments to implement changes
and who had the willingness and desire to learn
from other organizations. As project managers, staff
has learned that the same person does not necessarily
meet both criteria. During the pilot phase, the
Steering Committee added measures in certain areas
to push service managers to think larger than merely
output measures and to include measures for state
mandated programs. For example, efficiency or cost
measures were added to fire services and Victim/Witness
Advocacy Program measures were included for police.
In regard to the "too different for comparison"
argument, the service committees have spent innumerable
hours defining the profile information to help explain
the operational differences among the cities. The
measures are reported on a "per thousand service
population" basis in an effort to equalize
the results across the various sized jurisdictions.
"There's
no way that city's data are accurate." In
a benchmarking effort, questions regarding the accuracy
of the data seem to be raised on a regular basis.
This statement has proven at times to be valid;
while at other times it serves as an excuse for
an unwillingness to believe that there is a better
process or practice for service delivery. The project
has used several strategies to combat this problem.
First, the service committees have spent numerous
hours developing definitions and descriptions for
the data collection forms. Second, the project asks
that those employees tasked with gathering the data
attend the committee meetings. This allows them
to better understand what we are requesting of them
and how other departments are reporting their data.
Third, the project has instituted a multi-step data-cleaning
process to review the data. The city managers are
asked to sign-off on each of their department’s
data before it is submitted, thus indicating that
they have reviewed the data. The project encourages
each jurisdiction to meet internally with all of
the staff involved in the data collection to review
and discuss the data. Once the data are submitted,
project staff investigates any outliers to determine
if there has been an error in reporting. The project
staff then holds a data-cleaning meeting with each
service committee. The service managers serve as
peer reviewers of each other's data, which has proven
to be the best approach to ensuring that departments
are reporting comparable information. One example
that highlights the effectiveness of this process
happened while the police committee was reviewing
the data. The service managers asked questions about
one city's clearance rate that was two to three
times higher than the average. Once the police chief
reviewed the data with his department, they uncovered
a computer error that had occurred when they had
queried for the information.
"I
can't control the cost of my city manager's department
or finance department." As part of the
cost accounting methodology both direct and indirect
costs are included for the efficiency - or cost
- measures. The Steering Committee wanted to analyze
the true or total cost for the organization to provide
services and programs. As described earlier, the
indirect costs represent the portion of the costs
associated with each central support department
in the city. How the time and cost for each of these
departments is allocated is determined by the nature
of their work or support that they provide to the
other departments (e.g., percent of time city manager
spends on department related issues, number of purchase
orders processed for department, etc.). The service
managers' argument is that they can only control
the direct costs associated with their department.
In order to meet the needs of both the city managers
and the service managers, the cost data for the
efficiency measures is reported in percentages for
direct, indirect and total costs.
CONCLUSION
The
benchmarking of services, by sharing performance measurement
statistics, provides organizations with the necessary
information to answer the questions of how efficiently
and effectively the services are provided to the community.
These management tools present an opportunity to learn
the best practices for service delivery. The organizations
that are progressive and truly committed to continuous
improvement analyze these delivery processes and methods
in an effort to adapt and implement them in their departments.
This is the ultimate purpose for benchmarking. The project
managers of the SCMBP are currently exploring the following
questions to determine the impact that the project is
having on the participating jurisdictions:
What
changes have been made in your operational methods
or processes as a result of the performance measurement
statistics comparison?
What
role has the service committee meetings, quality
survey data or cost data played in these changes?
Has
the organization altered its focus or program priorities
as a result?
If
the jurisdiction is preparing for a budget reduction
in the near future, have decisions been based on
the true cost of providing services?
If
little or no change has resulted, then why?
In the next
edition of Public Policy and Practice we will
explore the responses to these questions and share
the best practices that have been uncovered as a result
of the South Carolina Municipal Benchmarking Project.
REFERENCES
Ammons,
D. (1995). “Performance measurement in local
government,” in Accountability for performance.
Edited by David Ammons. Washington, DC: IMCA.
Ammons,
D. (1997). Raising the performance bar locally.
Public Management, September 1997: 10-16.
Ammons,
D.N. (1998). Raising the performance bar locally.
Popular Government, Spring 1998, 29-35, [reprinted
from Public Management, 79, 10-16].
Behn,
R. (1994). Measuring spending is not enough. The
South Carolina Policy Forum, Vol. 5, No. 4:
4-5.
Bogan,
C.E. and English, M.J. (1994). Benchmarking for
best practices: Winning through innovation adaptation.
This
article describes the South Carolina Municipal Benchmarking
Project (SCMBP), a collaborative approach in which
municipalities are benchmarking their performance
in key service areas. More specifically, this article
discusses the purpose and background of the SCMBP.
It also provides a discussion of the project’s
structure namely its governing, process, and staffing
units, which have been invaluable to SCMBP’s
functioning and successes to date. With this, a detailed
discussion of the SCMBP’s service areas and measures
will follow. Finally, the project’s status will
be touched upon highlighting key project implementation
issues and strategies to date.First, however, a quick
examination of the term of “benchmarking”
will provide the context within which the South Carolina
project was undertaken. 
Benchmarking,
originally simply a geodetic term that designated
a reference point for surveying purposes, became additionally
a business term (and process) in the late 1970s. In
the early 1980s, for example, Xerox Corporation became
one of the first companies to use the new terminology
extensively to designate its innovative approach to
quality management and performance measurement. Xerox
used benchmarking, according to former CEO David Kearns,
as “the continuous process of measuring products,
services, and practices against the toughest competitors
or those companies recognized as industry leaders”
(Bogan and English, 1994, p. 4).