University of East London

East London Business School

Rheinische Fachhochschule Köln

Postgraduate Programmes

MBA - Part Time

Management Dissertation

The role of upward feedback in effective Federal

public administration in Germany

- as part of the new public management and modernisation strategy

Cologne, May 2008

Prepared by:

Gabi Scholz

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Management Summary

Recently, private and public organisations have been using upward feedback to meet new

challenges in human resource management in public administration. Most of the

discussions dealing with the accurate use of `modern instruments′ like upward feedback for

the management development process can be found outside Germany. Upward feedback

focuses on managerial development rather than having a judgemental purpose.

This paper addresses literature research dealing with upward feedback, which suggests

that upward feedback can lead to performance improvement. Most research studies

discuss the use of this instrument in private companies or in local public agencies.

There is almost nothing in the literature about whether upward feedback is used at the

federal administrative level in Germany. Consequently, this the paper examines whether

the instrument of upward feedback is really used rarely at the federal administrative level in

Germany. To analyse whether the instrument of upward feedback is used at the federal

administrative level in Germany the researcher designed a questionnaire, which was

sent to all 15 supreme federal authorities (the Federal Chancellery and the fourteen

Federal Ministries) and to 54 subordinate federal administrations along with information

regarding the purpose of the research. Information from 69 respondents shows that

16 % of federal authorities are already using the instrument on a regular basis, one for

ten years and another for eight years. Some 22 % are planning implementation in the

near future and two of these have already undertaken a pilot project with good results.

The paper identifies salient concepts, in the field of upward feedback, which are

currently being employed in the private and the public sector. No ideal approach can be

found in either the literature or in practice. However, one fundamental conclusion was

identified: it is not enough simply to receive feedback. An organisation has to take further

aspects into account, for example to define and communicate the purposes of the feedback

before starting the feedback programme, to help employees to interpret and react to the

ratings and to set up rules on how managers are to deal with the results etc. If this is done,

the instrument can be a powerful tool for managerial developmental purposes.

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Contents

Management Summary ii

Index of Tables v

Index of Charts v

Acknowledgements vi

1

Introduction 2

2

History 7

3

Development 8

3.1

New Public Management 8

3.2

Trends in Germany 12

3.3

Upward feedback 17

4

The theoretical background of the instrument `upward feedback′ 18

4.1

Definition 20

4.2

The benefits of upward feedback 21

4.3

The purposes of the upward feedback 26

4.3.1 Appraisal versus Development 28

4.3.2 Cultural Change, Communication and Team work 30

4.3.3 Motivation 30

4.3.4 Improving Leadership through development 32

4.4

Overview of the formal components and anonymity versus open 36

4.5

Covered areas: Items to be rated 39

4.6

How to deal with feedback findings 43

5

The practical background of `upward feedback′ 47

5.1

Methodology 48

5.2

Results 49

5.3

Limitations of the Research 52

6

Conclusion 53

7

Managerial Implications 56

8

References 57

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9

Appendices 68

9.1

Appendix A: Glossary 68

9.2

Appendix B: German questionnaire sent to the respondents 69

9.3

Appendix C: English translation of the questionnaire sent to the

respondents 74

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Index of Tables

Table 3.1

Number of public employees in four OECD countries between

the year 1990 and the year 2000

Table 3.2

Number of public employees in Germany between 1996 and

2006

Table 4.1

What supervisors of the Washington Gas Light Company

thought in the early 1950s about implementing upward feedback

Table 4.2

How feedback affects individual performance by motivation

Table 4.3

Formal components of upward feedback

Table 4.4

Summary of key findings from a questionnaire analysing overall

value to recipients of feedback

Table 4.5

Summary of key findings from a questionnaire analysing action

undertaken after receiving feedback

Table 5.1

Use of upward feedback at the supreme federal level in

Germany

Index of Charts

Chart 3.1

Areas of modernisation in Germany in the first 10 years of NSM

Chart 4.1

Reasons for the implementation of upward feedback

Chart 4.2 The four `types′ with different self-others-awareness and their

tendencies towards improvement

Chart 4.3

The Leader/Manager Dimensions

Chart 4.4

The Leader/Manager `Map′ of Behaviour

Chart 5.1

Use of upward feedback at the federal level in Germany

Chart 5.2

Use of upward feedback at the supreme federal level in

Germany

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Acknowledgements

I would like to express my sincere thanks to Isobell and Bernard Pejn who were

incredible in supporting me in my English and advised me in a patient, constructive and

motivating way. Without this support I would not have been able to undertake this

dissertation in the way that I did.

I am also indebted to all the agencies which supported my practical research by

providing me with the large amount of inside information needed to complete this work.

Finally, I want to thank my parents without whose sympathy and patience I never could

have accomplished this paper.

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`It takes two to see one.′

C. S. Lewis (as cited in Dayton 1995:5)

`O′ wad some poower the giftie gi′e us, tae see o′orsels as ithers see us.′

Rabbie Burns (as cited in Spencer)

The translation of these words of the Scottish poet may clarify the meaning:

`

Oh would some, the gift give us, to see ourselves as others see us.

′ (Spencer)

`In the right key, anything can be said, in the wrong key, nothing. The only

delicate part is the establishment of the key′

George Bernard Shaw (as cited in Spencer)

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1 Introduction

The object of this research was to determine the use and the effect of upward feedback

within public sector management in the federal administration in Germany.

In turbulent times like today in which the environment changes very fast, the burdens,

with which local governments have to deal, are getting tougher. Among these new

challenges are

`

globalisation, economic competition that cuts across national borders, social and

political upheavals, technological change, threats of terrorism, and a rapidly

changing labour market

′ (United Nations 2005b:1).

As the United Nations points out,

`

the development of an effective, competent and forward looking public service as

well as strong but lean State institutions is one of the greatest challenges nations

around the word face today

′ (United Nations 2005b:iv).

This shows very clearly that the public sector is also becoming aware of the increase of

international competition and globalisation.

The Federal Government of Germany has recognised that focussing on the future is

essential to meet today′s challenges. As stated in the coalition agreement of 11

November 2005, the Federal Government of Germany desires to create an innovative,

capable and efficient administration.

It became obvious that it is not enough just to change organisational structures. The

public sector all over the word realizes, that something has to be changed. What this

could be is not clear at the moment. In Germany for example a lot of "

reform waves

"

(Reichard, 2003:347) arose, but up to now the federal framework legislation is an

obstacle to reforms, especially in respect of the treatment of civil servants. Restrictions

due to the much formalised civil servant law constrain a lot of reform ideas.

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In the past, public-service personnel was often identified as one of the key problems of

the public service due to the fact that it accounts for 25 % - 70 % of the total expenditure

and therefore could be considered the key cost factor (Klages 2001:443). This led to the

declaration in Germany that the reduction of personnel had to be a priority issue at all

administrative levels. Germany was not the only country, which tried to solve fiscal

problems in this way. In 22 of the 27 member countries of OECD such downsizing

programmes in the public sector were carried out between 1987 and 1992 (United

Nations 2005a:53). As the United Nations claims, reducing the number of staff without

redefining the functions of the government did not provide a solution to the underlying

problem (United Nations 2005a). As Klages explains, this situation led to a discrepancy of

diminishing performance capacities on the one hand, and the growing demands, on the

other which lead to the fact that the public sector is currently facing the dangers inherent

in an expanding capacity gap (Klages 2001:444). Another assessment added, that

`fiscally driven reduction of state employment and functions have gone too far

and have not led to general and significant efficiency and accountability

improvements′

(Therkildsen, O. 2001 as cited in United Nations 2005a:54).

To overcome this crisis, the idea of `New Public Management′ (NPM) has emerged as

an answer on a broad international basis. Klages noted that `this concept can be said to

be based on the conviction that the introduction of managerial thinking and the

employment of managerial instruments used by the private sector will mobilise

productivity reserves, which will improve public-sector efficiency to an extraordinary

degree′ (Klages 2001:444). There is a widespread recognition - especially in

discussions dealing with the topic of the `managing change process′ - that

organisational changes, irrelevant of their nature or extent, have to be accepted by the

employees who are supposed to put these changes into effect. Greenberg and Baron

argue that

`Organizational changes that are "sprung" on the workforce with little or no

warning might be expected to encounter resistance simply as a knee-jerk

reaction until employees have a chance to assess how the change affects them.

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