LA INVERSIÓN EN ECUADOR

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policies. The effects covered by a project (the outcomes) are often achieved within a longer horizon, and more outputs are needed in order to achieve an outcome (Mandl et al., 2008).

In summary, measures aimed at monitoring efficiency are mainly concerned with the relationship between input and output variables while those aimed at monitoring effectiveness are concerned with the extent to which achieved outcomes are compared with stated objectives.

At a strategic level, for example, the public sector; the appropriateness of chosen objectives against policy direction are evaluated. These relationships are shown in Figure 2.3.

Figure 2.3. Performance measurements in the public sector (Then and Tan, 2002)

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The problem for public organizations is that improvements in performance take time to achieve but the electoral pressures are such that they need to show improvements in the short term. Some governments believe that the public will be more convinced that services have improved by the presentation of numerical performance information. However, even with numerical information there are questions about quality and accuracy. While governments present performance results as objective evaluations, this information, depending on the nature of the political system, can become part of the political conflict between the government and the opposition. This is more a problem in political contexts where the norm is adversarial rather than consensual politics. In this context, the opposition can use the very same results to discredit the government‘s performance and to raise questions about their objectivity.

A related issue is whether the public and interest groups are willing to accept the government‘s presentation of performance results. Performance results are generally aggregated outcomes for the whole country, a region or a single large institution. Even if accurate, the general conclusion may be at odds with some individual experience. Thus it is almost inevitable that performance results will be challenged on the basis of that experience. The views of the public are more likely to reflect personal experiences or views presented in the media rather than the government‘s performance reporting (Curristine, 2005). A great deal of rhetoric has surrounded the introduction of performance management. Supporters claim that it has the capacity to transform public organizations‘ processes. However, it is important that it should not be seen as a panacea and that governments have realistic expectations about what it can achieve and the time needed to reach these objectives.

45 2.7.4 Performance Information

Performance information refers to the status and progress information about schedule activities, deliverables, budget, resources. It is used as an input for several processes e.g. to estimate work remaining to complete the project (Curristine, 2005; Department of National Treasury, South Africa (2010). Performance information can also be referred to as the raw data of the project‘s status, or the ‗as of now‘ status of the processes. It refers to what work has been completed, or how much time has been elapsed, or the cost incurred. It provides us information about the current status of the project deliverables. This information is utilized in performance measurements and the performance reporting.

Performance information includes, but is not limited to:

a) Scope: How much of the scope of the work has been physically completed?

b) Time: Schedule progress; e.g. status of activities; i.e. how many activities have been completed, and how many have been started and their current status, etc.

c) Cost: How much cost has been incurred to date?

d) Quality: Here technical performance measurements are noted. For example, characteristics of product; i.e. physical properties, quality metrics, number of defects and rejection rate, etc.

e) Risks: Risks status which includes how many identified and unidentified risks have occurred, how many new risks have been identified, effectiveness of response plan, how much contingency, or management reserve has been utilized.

f) Procurement: Procurement related activities; e.g. how much material supplies have been delivered by the supplier, and how much money is paid to the contractor, etc.

According to Parmenter (2007) all organizations keep records and notes of their activities or operations. This simple checking becomes monitoring when information is collected routinely and systematically against a plan. Inputs, outputs (specific elements of service), outcomes (specific products or elements of service provided by the organization), outcomes (changes or difference made as a result of the organization‘s outputs) and impacts (longer-term or broader changes) are usually monitored. Finding ways to collect monitoring information is also a key

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part of monitoring and evaluation. Tools for collecting data can be grouped under four basic heads: surveys and questionnaires, observation, interviews, keeping records and notes.

Performance information is potentially, limitless, complex and expensive to collect. Any formal system of gathering such information must of necessity be highly selective. There are limits to how much information decision makers can use; people have ―bounded rationality‖ and so do organisations. Decisions are taken by busy, often distracted ministers and directors who operate under complex incentives. Providing them with more information does not necessarily help their decision making and may actively hinder it (Department of National Treasury, South Africa (2010). According to Curristine (2007), the use of performance information in the budget process seeks to move the focus of decision making in budgeting away from inputs (how much money can I get?) towards measurable results (what can I achieve with this money?). The key performance information variables are shown in figure 2.4.

Figure 2.4. Key performance information variables (South African Department of National Treasury, 2010)

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A number of benefits can be derived from the use of performance information (PI):

a) It generates a sharper focus on results within the government.

b) It provides more and better information on government goals and priorities, and on how different programmes contribute to achieve these goals.

c) It encourages a greater emphasis on planning and acts as a signaling device that provides key actors with details on what is working and what is not.

d) It improves transparency by providing more and better information to legislature and to the public, and has the potential to improve public management and efficiency. involves the efficient allocation of public expenditure in accordance with government priorities.

e) It improves allocative efficiency by providing the government with information that facilitates the allocation of funds towards high-performing programmes and which are preferred by the citizens

According to Curristine (2005) and OECD (2005), performance information is important for effective management, including planning, budgeting, implementation, reporting, monitoring and evaluation. It helps to assess and improve policies in:

i. Managerial analysis, direction and control of public services;

ii. Budgetary analysis;

iii. Legislative oversight of the executive and iv. Public accountability

Castro (2011) however, maintains that results of the public sector, including budget allocations, presents its own set of information challenges. First, collecting information on performance indicators is not easy. For example, output indicators are mainly based on administrative records (day-to-day data produced by programs on their own), which can be very weak in many developing countries. Outcome indicators, on the other hand, often rely more on statistical estimations (discrete observations obtained through survey approximations), which in many countries are not collected regularly enough to inform critical government decisions. In such weak institutional environments, national statistics offices should be considered a valuable resource.

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Second, performance information needs analysis. Even if good information exists, it cannot be considered performance information until it is processed and organized in a structured, accessible, and timely manner. Utilization strongly relies on sound analysis rather than on the existence of large volumes of indicators. The challenge is, therefore, who should conduct such analysis and how, so that the information can be digestible and useful for decision makers.

Because this analysis can be demanding and time consuming, it requires a technical unit made up of sufficient capable professionals who specialize in conducting regular assessments and reporting performance information within the government. Experience also shows that it takes time and practice to develop quality and timely performance information, which in turn requires direct knowledge of the specific policies and programs to identify with precision what will be measured (Northern Territory Government, 2012).