NSW councils can now compare their performance against corporations and federal government agencies on a range of indicators, including their workforce, leadership, outsourcing and finance.

More than half of the state’s 152 councils have voluntarily taken part in a project designed to give them an insight into the health and performance of their organisations and to highlight their strengths and weaknesses called the Operational and Management Effectiveness Survey.

The self-assessment project, which was spearheaded by Local Government Professionals Australia, NSW and PricewaterhouseCoopers (PwC), has just delivered 72 councils, including Bankstown, Liverpool and Tamworth, with the first of three reports – which will eventually span June 2013 to June 2015 – including statistics and analysis across five key themes: workforce, finance, operations, risk management and corporate leadership.

Another seven councils have signed up for the next round of reports.

Local Government Professionals NSW CEO Annalisa Haskell said PwC already used a similar tool to help private sector companies and federal government agencies get an insight into how they were tracking and the new project meant councils could see how they measured up to the corporate world and next-tier bureaucrats on metrics such as finance and staff turnover.

PwC’s 2013 Benchmarking Insights Report for the private sector, “How do you know if you lead or follow?” had several indicators in common with the local government project.

Both surveys included research on the percentage of new staff joining the organisation, staff turnover, the cost of carrying out a finance function, the number of services outsourced, views on outsourcing and the biggest challenges of outsourcing.

PwC also produced a 2013 report for 30 Australian federal government agencies, Understanding Productivity: Federal Government Benchmarking on Corporate Services, which looked specifically at the way finance departments functioned. This included looking at the proportion of manual processes in finance, forecasting and the role of the Chief Finance Officer.

However, Ms Haskell cautioned that much of the data was highly specific to local government and comparisons with private sector organisations and federal government agencies would not be possible in some areas.

The survey data has another major advantage for councils because it finally allows them to compare themselves to councils of a similar size. Although the results of each council remain anonymous, they are grouped according to size and whether they are rural, regional or metropolitan.

Ms Haskell began the project several years ago in response to the increasing pressure on councils to benchmark their performance across a wide range of indicators.

It was a prescient move, given the emphasis that current Fit for the Future (F4F) applications place on delivering accurate performance assessments, improvement plans and hitting Fit for the Future benchmarks.

The second survey report will hit council desks 10 to 12 weeks before the F4F applications deadline and the third report will come well before the next council elections September 2016 so the sector will have three annual data points to compare to.

Ms Haskell said the idea was to deliver work of high quality and value from a very skilled partner but to keep costs down for councils.

“It gives a result back that is far more detailed and gives answers into how their business is operating relative to other councils,” Ms Haskell said.

“They can have an apples and apples discussion with their neighbours for the first time. They will be able to say, for example, “What is your ratio of management to staff?”.”

Ms Haskell said the reports could also be used to help general managers explain the council’s position to councillors and staff and to drive changes and improvements.

“It gives councils more self-awareness because what you know you can change,” she said.

The reports demanded a firm commitment and a fair amount of work from participating local councils. Each one had to enter its own data into a secure portal with the format of the final reports echoing those produced of the NAPLAN results.

Councils paid between $1,500 and $24,000 for each report, depending on their size, when they signed up and if they took a bulk purchase option. There were also incentives where the majority of councils in their regional organisation of councils (ROCs) participated together.

Ms Haskell said it was up to individual councils to decide whether they wanted to make their data public.

“The results are owned by the councils who participated. They all get their own personal result via a report and the global results from the entire population set,” she said.

“We have no plans to publish the data ourselves out of respect of the process. We were the initiator and facilitator and did not build this to get kudos from the data set – we see it as owned by the participants.”

NSW Local Government Minister Paul Toole praised LG Professionals and PwC’s research project at a recent LG Productivity and Sustainability Forum.

“It’s organisations like this association that provide new innovative approaches to helping councils and professionals that need to be acknowledged and this recent survey initiative is just another example of thinking outside the box,” Mr Toole said.

Ms Haskell will speak about the council results and overall findings in more detail at the Local Government Operational Effectiveness Survey Seminar in Sydney on December 3.

LG Professionals NSW is currently exploring the possibility of working with other LGMA Federation Associations to roll the survey out to other states.

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