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How can the public sector improve productivity?

The below is an exclusive extract from  Solving the Productivity Puzzleby Tim Ringo.

What if we created a workforce 'marketplace' that not only balances supply and demand of resources, but also maps people's skills, motivations, and aspirations to the right job at the right time?

This is people engagement, innovation and performance (PEIP).

This is an 'equation' for working smarter which means putting the right people, with the right skills in the right place at the right time with the right motivation.

The public sector role

The public sector has a unique, dual role in cultivating PEIP. The public sector role is to:

  • Engage and develop public sector employees to drive productivity and improve public services, while being more efficient with taxpayer funds.
  • Incentivize and encourage private sector organizations to invest in the workforce; play a positive political role in creating change in the economy and society.

The public sector role is the point where the debates on growth, living standards and deficit reduction converge. In the long run, living standards and productivity are closely linked, and our political leaders as well as administrative leaders have a critical role in driving change and creating the environment for the private sector to flourish.

Additionally, the public sector is a massive employer in almost all countries around the world. It is a high-profile workplace, with a unique position in society and the power to set the workplace agenda – for good or for ill.

For example, in the UK, one-sixth of workers in the country work in the public sector. This is not an unusual ratio of public versus private sector numbers of workers (O’Boyle et al, 2016).

Like most countries, the demand for public sector services in the UK, including healthcare and social care, is increasing, making the public sector one of the fastest-growing parts of the global workforce.

Unfortunately, government organizations generally score low in people engagement and development relative to the private sector. It has been relatively tough to build a career in government service in the past decade or so. Like the private sector, the pressure to do more with less is a constant theme, but in the public sector, the pressure only increases with time and the next budget round.

The austerity of the 2010s continues in many countries, where there is a continued focus on debt and deficit reduction; all necessary things to do. The constant fiscal pressures suck up all the oxygen and it is therefore not a conducive environment for building engagement in the workforce. This can radically alter the environment where driving engagement and innovation becomes a distant daydream while improving the cost base is the perennial focus.

Engage talent to join ‘the mission’

However, when it comes to attracting and retaining talent, the public sector usually has one unique advantage: a strong societal purpose. Most people who take up government service do it for ‘the greater good’ of society at large; they want to serve the community.

Take for example the UK’s GCHQ (Government Communications Headquarters), which is an intelligence and security organization responsible for providing signals intelligence (SIGINT) and information assurance to the government and armed forces of the United Kingdom. It was the secret intelligence unit that cracked the German Enigma code during World War II, which many believe shortened the war considerably. Founded in 1919 at the end of World War I, its very existence was not even acknowledged by the UK government until 1994 (talk about a recruitment challenge!).

This highly secretive organization has been in the midst of a rapid transformation of focus from analogue communications to digital communications and artificial intelligence. They are increasing recruitment of top talent on a year-on-year basis, competing for the same talent that Google, Apple and Twitter are looking to attract. They need the full range of digital, cyber and mathematical skills to do the highly complex and important security work they perform.

GCHQ offer a competitive starting package for graduates, at about £29,000 per year with attractive benefits, but after that, the rewards begin to pale when compared to experienced talent in the private sector. As a senior recruitment officer said in a 2019 FT Magazine article, "We just can’t compete with Apple or Amazon [in terms of pay]. So, a lot of our focus is on recruiting people with the right motivation" (Bond, 2019); and the GCHQ director, Jeremy Fleming says, "I don’t have all the levers that a private sector organization has. But I have loads of levers that they don’t have. People come here because they want the mission, to feel a part of something special."

GCHQ has another lever that it is using far better than most private sector organizations: diversity. The organization has had a policy for several years to actively seek out the LBGT community along with the black and Asian communities. GCHQ has led the way for a number of years in recruiting ‘neurodiverse’ individuals; people on the autistic spectrum, or those that have dyslexia, dyspraxia, or dyscalculia.

They have found that top talent comes in many different forms and have been very successful in putting this talent to work on some of the most complex challenges that an organization can offer its workforce. After all, they have an illustrious alumnus: Alan Turing, who cracked the Enigma code. He was a gifted mathematician, known for being on the autistic spectrum. He was a model for what made GCHQ so successful: brilliant, but also not in the mainstream of recruits; he had a different type of intelligence than others. Turing probably would have struggled to find a career back in the day, but GCHQ thankfully saw past his quirkiness and deployed him to the most important, most secret mission of his day.

GCHQ officials have found that people with such diverse conditions are able to tackle difficult challenges by putting to best use their ‘different brains’. Additionally, they have found that people in this pool of talent are highly motivated by purpose and ‘the mission’ and become singularly dedicated to the job and the cause – ideal for creating the best conditions for diverse people to thrive at work.

In a similar example, I was recently invited to a dinner with a senior leader in the HR department of a large Canadian city. During our highly engaging discussion, this HR leader talked about the advantage of having a broader purpose to serve in public sector roles, and how it can be a powerful motivator. She told me a story about ‘wastewater engineers’, who are very important to the hygiene and smooth running of the city, and how this team of engineers take special pride in their role. It’s unique in that it is not a role they can find in the private sector, as all wastewater utilities are run by the city.

She explained that they have no problem recruiting and retaining these engineers; as long as they are paid a reasonable salary (and state pension) that allows them to live a middle-class existence, they are completely devoted to their work. They thrive on finding new and better ways to deal with the wastewater of this large city. Striking it rich in the private sector does not particularly motivate, so they stay and work the long hours required in this public sector role – a major advantage over private sector work. However, this can sometimes be taken for granted by public sector leaders at the expense of a broader, more strategic approach to managing a public sector workforce. Beware the limits of relying solely on a person’s desire to serve.

PEIP for public sector roles

People engagement, innovation and performance – getting right people, right skills, right place, right time, with the right motivation – is as necessary and beneficial in the public sector as in the private sector; both public sector and private sector individuals and leaders in the workforce value and gain value from the approach equally.

Additionally, to compete with the private sector, it helps the public sector tremendously to demonstrate to potential talent that the public sector workplace is as innovative and engaging as any private sector organization.

However, there are key differences between the two types of workforces that need to be considered. As described earlier, what motivates public sector workers can be somewhat different than how private sector workers are motivated. Additionally, in many cases, the types of skills required in a public sector organization can be somewhat different than you will find in the private sector.

For example, being a tax accountant in the taxation authority of the government is very different from being a tax accountant in a private sector firm. A public sector accountant’s skills are focused on compliance of organizations to tax regulations through audit, whereas a private sector tax accountant would focus on minimizing the firm’s tax exposure and maximizing profit from a thorough understanding of tax laws and their application. The same qualifications are required for the role, but different skills are needed to carry out the job.

Additionally, deploying public sector workforces, ‘right people, right place, right time’, can also have a different profile than in the private sector. Many public sector roles have a ‘long runway’, meaning that people often will stay in particular roles for long periods of time compared to the private sector. Take, for example, the Canadian wastewater engineers; they have a particular skillset and role that will see them working in this same department for many years, even decades. The same would apply to healthcare workers, like doctors or nurses, who will spend an entire career in one, maybe two roles in one location, or one country.

Strategic workforce planning for public sector roles can require a potentially longer time horizon than in the private sector. Often the term ‘bureaucrat’ is used to describe government workers (often in the pejorative!), but it does capture the essence of much of public sector work, which is often administrative in nature and has a different pace of change than is sometimes found in the private sector. Therefore, overall, PEIP in the public sector has some key differences.

Having made the point, however, it should not diminish the fact that when one is employed in the public sector, people are people, no matter where they work. They have the same desire to have clear objectives, opportunities to develop, opportunities for advancement, leadership that allows them to flourish, as well as a say in the type of work they do and when they do it.

The differences between public sector and private sector workforces are, overall, not that big. Nonetheless, it is key to not think of the PEIP model as a ‘one size fits all’ but to understand the nuances of different workforces and the jobs they fulfill.

Political will to drive PEIP in society

The public sector has a unique role to play in the PEIP story. As we have seen previously, the power of PEIP is that it can not only drive change for organizations but can also create change in society at large. When a nation, or group of nations, has a goal to encourage the development of working places that allow people to flourish by engaging them, allowing them to develop new skills, and giving them the time to come up with new products or services, the knock-on effect for society is a new level of prosperity.

In the United States during the 1990s there was an unprecedented level of people productivity driven by exciting new technologies, new management thinking, and a government that helped put in place the right conditions for citizens and the country to thrive. The Clinton administration was known for being particularly business-friendly relative to previous Democrat administrations. The Clinton team also implemented an ambitious programme, led by Vice President Al Gore, to make government more efficient by adopting best practices from the private sector.

The private sector and the public sector were working together to take advantage of new technologies, and a focus on getting right people, right skills, right place, right time, with the right motivation. It was a powerful combination that paid off handsomely in creating eight or so years of high levels of people productivity by investing in technology and engaging/aligning people to this new technology to improve the workplace.

The role of the manager in today’s public sector workplace is therefore not just to set clear objectives and facilitate ongoing professional development, but to engage staff as service designers and problem solvers in their own right. Giving employees a sense of control and autonomy can be the key factor in delivering higher performance and coping with higher demands when austerity or other major difficult initiatives are underway.

This has important implications for:

  • Policymakers: to think differently about what productivity means in the public sector – and how to measure it. This means building on recent efforts by many countries to put in place base measures around the achievement of outcomes that are important to governments and service users.

  • Leaders and managers: to engage staff by connecting them to the organization’s purpose; empowering and enabling staff to co-design improvements to processes and jobs, not just as a motivational tool, but as a key source of information about how services, productivity and outcomes could be improved; and strengthening two-way communications with staff to improve collaboration in the workplace.

  • Human resources departments: to consider the core capabilities required to work in a more dynamic and innovative public sector. These capabilities should include specialist expertise, but also the appetite and capacity to work with the public in redesigning services for improved outcomes and productivity. HR departments must have the technical capability to advise on the construction of roles and organizational structures to ensure that these elements encourage the overall design of good jobs and effective organizational management.

  • Providers of learning and development: to coach and develop public sector staff to enable more adaptable talent and more collaborative ways of working within and outside the public sector.

  • Remuneration committees: that think creatively around public sector rewards packages and implement effective programmes of remuneration.

However, do we have to wait for government to see the opportunity? Would it not be better for government to be driving the PEIP agenda in the public and private sector spheres?

Proactive government that advocates for and puts in place the right conditions to encourage all organizations to put in the ability to get right people, right skills, right place, right time, with the right motivation, both in the public sector (being a leading example) and the private sector. Political leaders are in powerful positions with rather large megaphones and can advocate for and create favourable conditions for the private sector.

Through responsible de-regulation, enlightened government policy and fiscal incentives, public sector leaders can be heroes of the moment by taking the lead on changing how we think and do differently at work, helping the private (and public) sector see the benefit and start to redesign the organization and jobs for the future.


Bond, D (2019) Inside GCHQ: The art of spying in the digital age, FT Magazine, May. Available from: https://www.ft.com/content/ccc68ffc-7c1e-11e9-81d2-f785092ab560 (archived at https://perma.cc/YNN3-XBRG)

O’Boyle, E, Patel, P C and Gonzalez-Mulé, E (2016) Employee ownership and firm performance: A meta-analysis, Human Resource Management Journal, 26 (4), pp 425–48. Available from: https://doi.org/10.1111/1748-8583.12115 (archived at https://perma.cc/5SVT-BXNU)

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