Wednesday, November 7, 2018
Performance management is a global trend, as well as the inclusion of citizen feedback as a component of these systems. What are the commonalities and contrasts in two cities of the same size but with very different forms of government? The post is broken into two parts – this one is the second, and focuses on the approach taken in the Chinese city of Hangzhou. The first part focuses on New York City’s approach.

How the City of Hangzhou Assesses Agency Performance and Gathers Citizen Feedback

While the oversight of New York City’s performance system is run out of the Mayor’s office, in Hangzhou, an independent commission assesses agency performance and gathers extensive citizen feedback.  This is a leading-edge approach in China.  Most other Chinese cities operate more like New York City, with their performance management system and oversight being managed by a bureau within the city’s government, with more of a focus on compliance and less on problem-solving.

How Is Hangzhou’s Performance System Organized? In China, the Communist Party’s leaders outrank the mayor.  In Hangzhou’s city government, the local deputy party secretary heads an independent Comprehensive Evaluation Commission, which is also known as the Hangzhou Performance Management Commission. As a result, this commission has significant clout when it assesses and scores each city department annually.  The commission has a staff arm of about 40, the Office of the Comprehensive Evaluation Commission (OCEC).

The Commission’s assessment of individual agencies is not unlike the assessments undertaken for the New York City Mayor’s Management Report, but the Hangzhou Commission’s report is organized around a 100-point scorecard that provides a summary score (New York City’s does not offer a summary score or ranking for its 45 departments).  The Commission’s scorecard for each city department is comprised of four components:

  • Public evaluation and feedback (50 points)
  • An assessment of whether annual performance targets were met (45 points)
  • An overall evaluation by city leaders (5 points)
  • An assessment of innovation and excellence projects (bonus points)

Hangzhou began measuring citizen satisfaction in 2000, when it launched a campaign to “allow the pubic to select ‘satisfactory and unsatisfactory government agencies’,” according to the OCEC’s staff director, Wu Bin. This was a pioneering step at the time in China. Initially, the satisfaction rating comprised 5 percent of a city department’s evaluation score.  This has since expanded to a weight of 50 percent of the evaluation score, with a goal of moving to 60 percent.  Interestingly, the national government has since adopted a strong emphasis on citizen feedback as well.  The recent national 19th Party Congress’s top priority is to be more people-centered and incorporate citizen satisfaction.

Public feedback is an important part of the city’s comprehensive evaluation system. City-level legislation in 2016 institutionalizes this cutting-edge approach, which:

  • Provides multiple feedback mechanisms, including the OCEC’s performance website (Chinese only) and the use of social media channels.
  • Publicly shares its performance data and assessments – In 2008, Hangzhou was the first city in China to publish an annual social evaluation report on the city’s website (link to 2017 report – Chinese only).
  • Publicly reports the results of follow-up to assessments that showed a need for improved performance.

The new municipal law (English and Chinese) defines the governance system, administrative processes, and the role of citizens and third-party evaluators in the performance assessment process. It stipulates that public opinion “must be absorbed and applied in the whole process of performance management,” and that “public satisfaction should be taken as an important criterion for assessing government performance.”  The city’s goal, according to Mr. Wu, is to enhance “political trust and satisfaction from the public and consolidate the legitimacy of its governance.”

The Commission also conducts oversight of 13 surrounding districts and counties that fall under the jurisdiction of Hangzhou.  These surrounding districts and counties have their own performance management systems and separate scorecards.

Administrative Routines for Collecting Performance and Feedback Information.  Hangzhou city leaders have institutionalized several administrative routines in order to conduct its comprehensive evaluations that results in the annual scorecard for agencies.  These include the following routines for public assessment and feedback:

  • An annual citizens survey.  This is conducted via mail and in-person surveys of about 12,000 households generated from a stratified random sampling of different geographic, economic, and demographic characteristics, with a response rate in the high 90s. In the past three years, 200,000 messages were sent to invite citizens to participate in the online survey, with an increasing respond rate. More citizens prefer to respond via their mobile phones.
  • Real-time customer satisfaction assessments. These are completed by service recipients at public service windows in government agencies.
  • Face-to-face assessments of government. Citizens can sign up to participate or to raise questions publicly on the local TV channels or via online portals such as the city’s official social media accounts.
  • In-person visits to a services exhibit hall.  There is a civic center exhibit hall where citizens can learn how the city government provides services, what actions are being taken to improve them, and to ask questions and provide comments.

More specifically, some of the administrative routines used to set and manage performance targets for city departments include:

  • Before setting annual performance targets for services provided by various city departments, the OCEC staff consult with external performance experts and each agency’s “performance information coordinators” on what they judge to be achievable levels of performance.
  • There is dynamic tracking and management of the performance targets, with daily follow up and supervision by agency-level performance-information coordinators.
  • The performance information coordinators are organized into a cross-agency network with the goal of transforming the city government, according to Mr. Wu, “from passively receiving public opinions to actively discovering public demands.”
  • A part-time team of about 30 actively engaged citizens serve in an advisory role in interpreting public opinion data, the assessments by government performance supervisors, and actively publicize the results of agency assessments.

Separately, third party assessments are undertaken to assess the award of “bonus points” for agency innovation and excellence projects, as well to undertake special assessments for major projects or topics of hot interest.These third-party teams have reviewed more than 1,000 innovation and excellence projects.

How City Leaders Use Performance Information. The key of any performance system is not so much to collect and report information so much as it is to use it to inform decisions.  The Hangzhou government has done this by creating a follow-through mechanism for the public feedback that it receives:

  • It assigns the collected opinions to relevant entities for develop improvements to performance problems, to set targets, and to provide feedback on progress.
  • City agencies make public commitments regarding the achievement of their performance targets.
  • The OCEC provides public transparency of the improvement process and resulting performance.

The OCEC also provides support for decision-making for public policies:

  • It organizes an annual analysis of public opinions and reports it to the Communist Party’s local committee, the city’s municipal government, and OCEC.
  • The report summarizes how performance problems identified in the previous year have been addressed and identifies potential priority areas for attention in the upcoming year.

In addition, data from departments’ daily performance information tracking and supervision systems are put into a “performance information database” and analyzed. If there is a recurring pattern, a “performance improvement notice” is issued to the relevant entity for action.

Results Achieved by Using Performance Information to Manage the City. City officials provided an example of how they used the results of citizen feedback to improve a failing function.  In 2010, citizens ranked “difficulty in seeing a doctor” as a significant problem, and the negative feedback doubled in the following year.  As a result, this issue was prioritized for “supervision and rectification” in 2012.  In response, the city’s health authorities changed their procedures significantly.  For example, services began to be paid via insurance as opposed to lining up to pay in person at a charging window.  Health officials also improved the scheduling of appointments. The results of these reforms were publicly reported and by 2016, the issue of “difficulty in seeing a doctor” dropped to less than one percent of total negative responses on surveys– effectively eliminating the problem.

Probably even more significant, Hangzhou has become a magnet for the Chinese tech industry – it is the headquarters for Alibaba (China’s version of Amazon) – in large part because of its reputation as a well-run city that makes it easy for entrepreneurs to do business and startups. A 2018 study (English version) ranks 30 Chinese “cities of opportunity” in ten dimensions, and Hangzhou comes out on the top.  The study says that Hangzhou is now the e-commerce center of China.

Next Steps.  Interestingly, city officials see a similar next step as New York City, with a greater emphasis on performance-informed budgeting. The city’s budget office is becoming more involved with commission staff in target setting for the performance measures of city departments.

* * * * *

Conclusions.  Some interesting observations between New York City and Hangzhou stand out when they are compared:

  • There is a more structured framework and a greater investment in both performance management systems and in citizen feedback in Hangzhou than in New York City.
  • Nevertheless, both cities see a need for a better link between their performance systems and their budget processes.
  • In addition, both cities seem to be investing more in real-time data reporting systems, which should have the effect of making performance data more relevant to decision-makers and front-line managers.

Read this blog in Chinese!

Link to Part 1 of this blog post.

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