The role of upward feedback in effective Federal public administration in Germany - as part of the new public management and modernisation strategy

Master's Thesis, 2008

84 Pages, Grade: Merit



Management Summary

Index of Tables

Index of Charts


1 Introduction

2 History

3 Development
3.1 New Public Management
3.2 Trends in Germany
3.3 Upward feedback

4 The theoretical background of the instrument ‘upward feedback’
4.1 Definition
4.2 The benefits of upward feedback
4.3 The purposes of the upward feedback
4.3.1 Appraisal versus Development
4.3.2 Cultural Change, Communication and Team work
4.3.3 Motivation
4.3.4 Improving Leadership through development
4.4 Overview of the formal components and anonymity versus open
4.5 Covered areas: Items to be rated
4.6 How to deal with feedback findings

5 The practical background of ‘upward feedback’
5.1 Methodology
5.2 Results
5.3 Limitations of the Research

6 Conclusion

7 Managerial Implications

8 References

9 Appendices
9.1 Appendix A: Glossary
9.2 Appendix B: German questionnaire sent to the respondents
9.3 Appendix C: English translation of the questionnaire sent to the respondents

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.

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


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.

‘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)

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.

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. In contrast, employees who are involved in the change process are better able to understand the need for change and are, therefore, less likely to resist it:’ (Greenberg and Baron 2003:605).

In the past employees, especially in the public sector, as in many private organisations, were not managed, they were administrated rather than managed (Brown 2004). There has been a rethinking in this area. Recently the public sector realized that good people are the “lifeblood” of each organisation or as Bach outlined, human resources are the most important ‘asset’ of any organisation (Bach 2001:4). Some claim, that cash is the “lifeblood” of each organisation – public or private. It is a moot point to say who is right. One thing is obvious – people are very important for the success or failure of any organisation and therefore should be managed in a sensitive way.

Accordingly as Klages (2001) points out there is a growing awareness that NPM can only be realised and work effectively if public employees become actively involved in its development. This led to public service personnel emerging as the most important resource in the modernisation process and one which decides success or failure.

With this in mind the Federal Ministry of the Interior argues that, the Federal Administration’s contribution towards budget consolidation cannot and should not be achieved primarily through cutting employees’ income (Federal Ministry of the Interior of the Federal Republic of Germany, 2006). It claims that there is a need for innovative solutions aimed at increasing administrative efficiency and flexibility. These innovations are expected to enhance productivity and create better income perspectives for employees (Federal Ministry of the Interior of the Federal Republic of Germany, 2006). The Federal Government of Germany has set up a programme under the name “Focused on the Future: Innovations for Administration”. The aim of this programme is to present a universal strategy for the further modernisation of the Federal Administration that encompasses, as well as other areas, the area of human resource management. To add more emphasis to the importance of this special issue the Federal Ministry of Interior of the Federal Republic of Germany on the one hand and the trade unions on the other signed the collective ‘Modernisation and Further education’ agreement for the federal administration on the 5th of October 2007. The parties to this declaration want to develop and strengthen topics like innovation, further education and executive development in the federal administration (Federal Ministry of Interior of the Federal Republic of Germany 2007).

In times of change the role of leaders is of particular importance. If employees have faith in the abilities of formal leaders and if there is a climate of trust between the leader and the team, the implementation of change can be successful (Bacal 2008). Due to that leadership, change management and human resource management have become important topics in public sector management (Van Thiel et al. 2007). Development and training of leaders has become an elementary aspect. As Ergun points out the preparation and development, particularly of senior administrators, is essential for the successful implementation of new development policies (Ergun 2007). One tool to develop leadership qualities, which is discussed in the literature, is upward feedback.

This research will concentrate on analysing the instrument of upward feedback for executive development purposes in public administration to meet today’s challenges. Modernization and reform discussions in Germany often do not cover this aspect very deeply.

New challenges in human resource management in public administration like the pressure of globalisation, technological changes and other issues are very much discussed in administrative practice and literature worldwide. Most of the discussion dealing with the accurate use of ‘modern instruments’ or ‘typically/originally business instruments’ like upward feedback for the management developing process in public administration can be found outside Germany. Most research studies discuss the use of this instrument in private companies or in local public agencies. This does not mean, that the issue is not important for Germany’s federal administration – the opposite is the case. One could get the impression that Germany somehow missed an international trend. This seems to be more the case at the federal administration level. At the local administration level more reforms, new strategies and debates can be recognized.

The author is working for a federal authority in Germany, which is subordinate to a Federal Ministry of the Federal Republic of Germany. Currently this institution is thinking about implementing an upward feedback system for executive development purposes. At the moment it is uncertain if such an instrument is of any use to a public administration especially at the federal level. If it is of any use the question of which special concept, process or tool should be used still remains.

Against this background the principal aims of this research are:

1. To identify and introduce salient concepts in the field of upward feedback, which are currently being employed in the private and the public sector.
2. To analyse the application and the utilisation of these concepts in the public sector in Germany by concentrating on the federal level and compare and contrast these to methods and use in the private sector.
3. To examine the effect of upward feedback on managerial behaviour.
4. To discuss if and how administrative work could be improved by implementing an upward feedback process for the development of current staff at the federal administration level.
5. To examine the application of the research to the current employer.
6. To set out substantiated recommendations to the current employer as well as to other federal administrations for future human resource practice.

2 History

The German public administration model is historically mainly based on the model of bureaucracy typified by Max Weber It is often described as a classical system of administration (König 2001). Among other things, bureaucracy is characterised by hierarchical coordination and control, a strict and uniform chain of discipline and command, and legal authority (Höpfl 2006). The hierarchy is defined by clear lines of authority and all employees have to know where they stand in relation to this line and that they have to respect the chain of command (Borgatti 1996). As a result, common appraisal methods had a judgmental character and were only given in a top-down way (Berman et al. 2006, Olesch and Paulus 2000). Bottom-up communication was not sought, tolerated nor practised. Subordinates were expected to follow their supervisors without questioning whether or not blind obedience made sense in meeting the organisational goals. The words of the leaders were ‘indefeasible’.

In recent years this structure has come in for a lot of criticism, because it is seen as insufficiently flexible and efficient in meeting today’s challenges. Keywords like ‘team’, ‘network’, ‘information’, ‘knowledge’, ‘empowerment’ etc. are seen as representing the best way forward in meeting these challenges rather than strict hierarchical coordination (Höpfl 2006). It is commonly recognised that a team is always stronger than an individual and therefore it is a good idea when supervisors begin to be more a part of their team rather than standing beside or above it. Leadership development is one vital aspect in changing these common bureaucratic structures (Kroppenstedt and Menz 2001). To reach this aim it is expected that more valid feedback might be a good tool in identifying the areas in which improvement is needed. In addition to this, it is expected that a well implemented feedback culture - including a bottom-up approach - in organisations helps to build teams and to create more open communication. Whether this aim can be achieved by the implementation of a tool like upward feedback needs to be analysed in more detail.

3 Development

The following chapter intends to give a brief overview of the development of New Public Management (NPM), the trends relating to this topic in Germany and the instrument of upward feedback. The paper will concentrate on relevant aspects dealing with human resource topics and therefore will not address other topics which are discussed under the heading of New Public Management such as ‘Lean and highly decentralized structures’, ‘managing for results’, ‘risk management’ or ‘the use of divisional structures in public service’.

3.1 New Public Management

German and French models in particular are often mentioned as typical examples of the so called ‘classic public administration models’ which developed over more than two centuries (Homburg et al. 2007). Hughes describes this traditional model as:

‘An administration under the formal control of the political leadership, based on a strictly hierarchical model of bureaucracy, staffed by permanent, neutral and anonymous officials, motivated only by the public interest, serving and governing party equally, and not contributing to policy but merely administrating those policies decided by the politicians’ (Hughes 2003:17).

In the late 70s, mainly as a reaction to financial crisis, this traditional model came under pressure. The main criticism was that the old system was too inflexible and did not meet public acceptance any more (Homburg et al. 2007; Schedler and Proeller 2006). In the United Kingdom, calls for elementary reforms arose in the 70s and therefore could be called a precursor in this area. In the 80s public management became an active element in policy-making in other countries like New Zealand, Australia and Sweden (Barzelay 2001; Larbi 2006).

International Organisations like the Organisation for Economic Co-Operation and Development (OECD), the World Bank and the International Monetary Fund, the United Nations Development Programme and the European Commission became interested in advising their members and clients worldwide of the process of improving public management (Hughes 2003, Lynn 2006, Wollmann 2001). In 1990 the OECD formally established its Public Management Committee and Secretariat, also called PUMA. According to Barzelay PUMA was conferring on public management the status normally commensurate with more conventional domains of policy (Barzelay 2001:2). Some surveys by the OECD in the early 1990s concluded that new business management techniques and practices were used in a lot of OECD member countries to bring changes in public management (Kickert 1996; Larbi 2006). As Larbi noted ‘these practices and techniques have conventionally been labelled the New Public Management’ (Larbi 2006:25).

The components of NPM have developed over the years but still there is no consensus among the authors on the subject of what NPM covers (Larbi 2006). However on one feature the writers seem to agree: the core principle of NPM deals with an emphasis on transferring private sector management techniques into the public sector as part of a broad strategy to achieve efficiency, effectiveness and quality of service (Brown 2004, Larbi 2006, Kickert 1996, Schedler and Proeller 2006). This happened in response to the administrative need to reduce government expenditure, provide more efficient services and decrease the scope and reach of government-provided public goods and services (Brown 2004).

By analysing the ten principles of the reform process of public sector organisation which were formulated by Osborn (1993), who is according to some authors one of the management gurus of NPM (Steijn 2002:4, Homburg et al. 2007:1), one has to recognize that one fundamental part is missing – the employee. The ten principles Osborn found were catalytic government, competitive government, mission-driven government, result-oriented government, customer-driven government, enterprising government, decentralisation, community-owned government, anticipatory government and finally market-driven government (Osborn 1993).

From a human resource management perspective this is a disaster (Steijn 2002). As pointed out before (see Chapter 1), for any successful organisational change it is fundamental to take human resource aspects into account as well. That the first level of reform covered only topics like downsizing the current staff might suggest that this reform level was manly driven by financial issues. Fiscal pressure has been one of the key drivers for reforms. As pointed out before, public-service personnel were 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). Nogueira and de Santana claim that the financial side of the reforms began from the ‘ diagnosis that the government apparatus was bloated with personnel who cost much and did little ’ (Nogueira and de Santana 2002:4). Due to the economic recession all over the world in the 1980s and early 1990s the public sector reforms concentrated mainly on structural changes.

The public sector tried to become more efficient by reducing its size and therefore many OECD countries enforced a downsizing policy of the public sector workforce during that time (Shim 2001). Table 3.1 illustrates the employment trends of total public employment over ten years in four selected OECD countries and points out very clearly the fiscally driven downsizing process. One major downsizing initiative was undertaken in the United Kingdom. Between 1990 and 1999 the number of public employees decreased by 34 %.

Abbildung in dieser Leseprobe nicht enthalten

As Ingraham outlined, the question of how to manage the people who would have to achieve all the new challenges lagged behind the first level of reform by several years (Ingraham 2007). However a broad and new way of thinking about the careful management of human resources could be recognized in the late 1990s. There was a widespread recognition that decentralization and budgeting were not working by themselves to solve the challenges which were being faced by the public sector. This has led consequently to the fact that ‘the need to manage people well […] is now a recurring theme in administrative reforms in many countries’ (Ingraham 2007:525).

For a few years a change can be seen in the public sector concerning human resource issues. For instance the public sector concentrates more on topics like leadership development to meet the new challenges in the new administrative environment of the 21st century (Shim 2001). One common technique for leadership development in many organisations nowadays is upward feedback (Van Dierendonck et al., 2007a; Greenberg and Baron, 2003).

A good example for this trend can be recognised in the United Kingdom where 3600 feedback, in which upward feedback is one element, was implemented for all senior civil servants by the end of 2001 (Cabinet Office 2001; Morgan et al. 2005). It was driven by the new public management trend and based on Sir Richard Wilson’s report on civil service reform (Morgan et al. 2005).

3.2 Trends in Germany

Not all OECD countries adopted NPM practices to the same extent in the 1980s. While most leading NPM reformers such as the UK or New Zealand started with NPM programmes during the 1980s, Germany, one of the ‘ OECD showcase economy ’ (Hood 1995:98), remained largely unimpressed by the international discussion and began its reform processes quite late, compared to the leading reformers, about 10 years later (Reichard 2003). Before that time there was no financial pressure in Germany to think about the NPM ideas and administrators as well as politicians thought that everything was fine as it was (Reichard 2003).

As the financial crisis in Germany has become more delicate, particularly with the financial effects of German unification, local authorities particularly became aware of the need for reforms (Wollmann 2003, Röber and Löffler 2000). Kuhlmann and Röber noted, that ‘without any doubt, administrative reforms in Germany were driven by the need to make savings’ (Kuhlmann and Röber 2004:21) There was a widespread recognition in Germany that traditional management tools were no longer working to meet the needs of a period characterised by economic decline (Reichard 2001).

In contrast to modernisation trends and programmes in other countries, the modernisation of the public administration in Germany ‘ has to be understood in terms of a bottom-up development ’ (Klages and Löffler 1996:132). At the beginning there were nearly no reform activities visible at the federal level (Reichard 2003; Klages and Löffler 1996). At the local level the German Kommunale Gemeinschaftsstelle (KGSt) – an association of municipalities for managerial reforms – developed in stages since 1990 the German variant of the NPM, the so called ‘new steering model’ or ‘ Neues Steuerungsmodell ’ (NSM) (Wollmann 2001; Klages and Löffler 1996). This managerial modernisation concept was developed to give an overview of the modernisation trends and to give a direction to the members of the KGSt (KGSt 1993, Wollmann 2003). The main elements of this new approach, summarised by Klages and Löffler, were the result-oriented budget, the search for the costs of administrative products, the introduction of commercial bookkeeping, decentralised resource accountability, the definition of indicators for quality standards, a closer customer orientation, outsourcing, contracting, privatisation and last but not least the openness to ‘competition’ (Klages and Löffler 1996). This listing shows parallels with the first modernisation lists of other countries such as the ten principles of the reform process of public sector organisations, formulated by Osborn (1993). Again there was no real reference to new human resource management methods to meet the new challenges.

illustration not visible in this excerpt

The German model was guided by an example from the Dutch city of Tilburg and therefore was labelled the ‘Tilburg model’ (Reichard 2003; Klages and Löffler 1996). The focus of this first modernisation step at the German local level was a trend to be more efficient, effective and open to the market (Klages and Löffler 1996) but it did not cover the issues of human resource management. The only human resource subject was – again – the question of downsizing. Table 3.2 shows the development in total public employment in Germany over ten years and illustrates very clearly the fiscally driven downsizing process in Germany.

Table 3.2 illustrates clearly that the number of total public employees decreased by over 13 % in the years 1996 – 2006.

A current research project in Germany – running from 2004 to 2006 – under the label ‘10 years of NSM – Evaluation of Local Administrative Modernisation’ is dealing with the question of the implementation of New Steering Model measures and their effects. The survey was conducted among mayors and county chief executive officers (Landräte) and the staff council chairs of all KGSt member local authorities (1565), as well as a written survey of the management of the lower echelons of building supervision authorities (representing classical regulatory authorities), and with the management of youth welfare offices (representing service authorities). The response rate was between 55.3 % (mayors) and 42.3 % (staff council chairs) (Bogumil 2006). There was one alarming finding from the questionnaire regarding areas of modernisation being covered: human resource management came fairly low in the list.


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The role of upward feedback in effective Federal public administration in Germany - as part of the new public management and modernisation strategy
University of East London
MBA International Business, Postgraduate Programmes - Part Time
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MBA, Dipl.-Verwaltungswirtin Gabi Scholz (Author), 2008, The role of upward feedback in effective Federal public administration in Germany - as part of the new public management and modernisation strategy, Munich, GRIN Verlag,


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