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Making Public Enterprises Work

Making Public Enterprises Work

William T. Muhairwe

(2009)

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Book Details

Abstract

Public enterprises remain the most dominant medium of service provision in both developing and developed countries. During the 1990s and early 2000s, the outcry about poor performance of public enterprises was overwhelming. Nobody at that time and even now has managed to design a ‘blue print’ solution. And yet, the fact that service provision through public enterprises is here to stay is the blunt truth. 
In Making Public Enterprises Work - From Despair to Promise: A Turn Around Account, Dr. William Muhairwe, the Managing Director of National Water and Sewerage Corporation of Uganda, discusses the approaches used to turnaround an under-performing state enterprise into a remarkable success story. Drawing on decades of experience, taming ‘struggling’ institutions, Dr. Muhairwe enumerates practical steps taken to make a significant difference in service delivery, for the benefit of any form of enterprise. Combined with facts, simplicity and fun, this book presents a unique account of methods used for constructive engagement and dialogue with donors, government officials, workers, suppliers and, indeed, the public/customers. All chapters are interspersed with tested lessons that any enterprise can benchmark to address its service delivery challenges. It is a great handbook for those involved in re-engineering their businesses. 
Making Public Enterprises Work contains unique home-grown turnaround reform steps that can help to revamp under-performing enterprises. It is the first book to demonstrate that performance contracts combined with incentives can work wonders in public enterprises. The book discusses how incentive rewards can spread to all levels of staff and encourage wholesome teamwork. It also looks at how enterprises can work without industrial unrest in very difficult conditions. In addition the book demonstrates how public enterprises that have been listed for privatisation can provide alternative restructuring steps.      
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"Well functioning, effective utilities hold the key to addressing Africa's water and sanitation service challenges. The National Water and Sewerage Corporation in Uganda, under the inspired leadership of William Muhairwe, offers both evidence of what can be achieved, and clarity on how to transform a once failing public water utility.  The experience and knowledge documented in these pages is a 'must-read' for sector professionals worldwide." PAUL REITER, Executive Director, International Water Association (IWA) 
"From grass to grace, this book makes a journey of a visionary man, a group full of purpose and an institution that understands the need to rise above adversity. [Its] a representation of the best in leadership and focus; a show of tenacity; a story of how management delegation, autonomy and trust in staff conquer the rot in institutional behaviour; a demonstration of structured incentives at work." ATO BROWN, SDN-AFCE1 The World Bank
"Inspired by modern management, Muhairwe shows how change can be led by managers in a public enterprise if given a chance." MEIKE VAN GINNEKEN, The World Bank, Central African Republic 
"… an in-depth insight in the energetic battle to improve performance in a public enterprise and certainly deserves to be read." CLAUDIA RADEKE, First Vice President, KfW and SUSANNE MAUVE, KfW  
"… a unique, firsthand account of how a successful reform can be done in practice… a must read for those engaged in the difficult task of reforming public enterprises." PHILIPPE MARIN, The World Bank, Washington DC 
"The genius work of empowering staff with the ‘carrots, sticks and sermons’ to cause a cultural revolution and institutionalize excellence." RICHARD FRANCEYS, PhD, Cranfield University, UK 
"A page-turning story of enlightened and brave leadership able to use internal incentives to bootstrap a public enterprise to much-improved performance… a road-map for other would-be reformers on the political and technical ingredients of success." JOHN BRISCOE, GORDON MCKAY Professor, Harvard University 
"This book makes for essential reading for any practitioner that seriously wants to better understand how performance can be improved within a public domain." ALDO BAIETTI, The World Bank Institute Washington DC 
"An uplifting account about overturning a fallacy… a demonstration by Dr. Muhairwe that it can be done and done successfully… a highly recommended read for all managers and leaders in the throes of overseeing change in their respective fields." ROBERT KABUSHENGA, CEO Vision Group 
'This book demonstrates how visionary leadership and ownership by the beneficiary institution can utilize development support to reform and accelerate service delivery... a must read for international development partners." DR. THOMAS SCHILD, Country Director and Hermann Plumm, GTZ, Germany

Table of Contents

Section Title Page Action Price
Half title 1
Title 3
Copyright 4
Dedication 5
Contents 7
About the Author 9
Preface 11
Introduction 15
Part One: TOUGH JOB: COULD IT BE DONE? 17
Chapter One: Serving Against all Odds 19
In the eye of the storm 21
Interference from the high and mighty 22
From bad to worse 23
Serving against all odds 25
Part Two: DOWN TO WORK: THE TURNAROUND 33
Chapter Two: Setting the Priorities 35
The 100 Days Programme 35
Shocked into a promise 36
Oh! Why did I say it? 37
More shocking encounters 39
Marketing the 100 days Programme 42
On the drawing board 45
From dream to reality 49
Trophies and bull roasting 50
Winners and losers 52
Reaping the fruits 56
Good ending, but what next? 60
Chapter Three: Focusing on the Customer and Financial Viability 63
Service and Revenue Enhancement Programme 63
Searching for the next step 64
SEREP implementation strategies 67
SEREP rewards, gains and constraints 74
Job well done, but more challenges 79
Chapter Four: A Pat on the Back 87
First Government Performance Contract 87
A nod to continue 88
Performance contract targets 90
Financing and monitoring of PC I 92
PC I implementation 94
Chapter Five: Swinging the Pendulum from the Centre to the Grassroots 97
Area Performance Contracts 97
Background of the APCs 98
Drafting the APC framework 98
APC secure staff support 99
Taking on the APCs mantle 101
The APC on the ground 103
The stick and the carrot 107
Support Services Contracts (SSCs) 107
Gauging progress and re-energising the APCs 110
APCs achievements 111
Bringing more towns on board 111
Impact of the APCs on the PC I performance 114
Chapter Six: The Group Incentive Mechanism 123
Stretch-out Programme 123
In praise of Jack Welch and Spencer Johnson 124
Selling the stretch-out concept 130
Modus operandi 137
Jinja Area workout 139
The stretch-out mental revolution 142
Matching words with deeds 143
From their business to our business 144
Stretch memories and experiences 144
Summing up the gist of stretch-out gains 146
Refining the reward system 146
Stretch shortcomings 147
Chapter Seven: The Individual Incentive Mechanism 153
One-Minute Management Programme 153
Group contribution: Tapping into individual participation 154
The dilemma of stretching at headquarters 156
A timely idea: The one-minute manager 156
The basics of the one-minute management concept 157
Turning the pyramid upside down 165
Putting one-minute management in action 168
Building high performing teams 174
Monitoring and evaluation 176
Towards a new corporate culture 177
Our gains 180
Chapter Eight: Reshaping the Partnership with the Government 183
Second Government Performance Contract 183
Key objectives of PC II 184
Distinguishing features 185
Implementation of the second performance contract 187
Chapter Nine: An Alternative Approach to Privatisation 191
Internally Delegated Area Management Contracts 191
Initiation of IDAMC concept 194
Marketing IDAMC 195
Preparation of the IDAMCs 195
Launching the IDAMC 199
Duties, rights and obligations 200
Breaches, penalties and arbitration 203
IDAMCs’ management fee structure 204
IDAMCs’ implementation 205
IDAMC I achievements 206
Critics proved wrong again! 209
The third performance contract 2006–2009 209
The second phase of IDAMC 210
Looking back and further ahead 211
Chapter Ten: A New Approach to Performance Monitoring 217
The Checkers System 217
Traditional monitoring approaches 219
The genesis of checkers 222
Widening the buy-in planning process 225
The harmonisation process 230
The Checkers System at work 233
Part Three: SO FAR SO GOOD 237
Chapter Eleven: Performance Balance Sheet 239
Snapshot of our performance 242
The challenges ahead 249
Part Four: NOT ALONE: PARTNERS’ ROLE 259
Chapter Twelve: Winning the Much Needed Goodwill 261
The Donors 261
At the lowest ebb 262
Inculcating a positive attitude towards donors 265
Courting donors 267
Were initial efforts convincing? The World Bank’s view 274
Eventual payoff: positive attitudes start evolving 275
Donors become real-life partners in service delivery 277
NWSC donor-funded projects since 1998 280
Trivialities can be detrimental to citizens 284
Donors continue to talk about NWSC’s reforms 285
It counts a lot to be appreciated 286
Chapter Thirteen: In the Shadow of Privatisation 291
The Government 291
In the eye of the storm 293
In the shadow of privatisation 296
Actions start speaking louder than words 298
Friends and allies 306
Chapter Fourteen: Public Partnership Reconstructed 319
The People's Voice 319
Negative customer perceptions and their effects 320
Measures to change customer perceptions 321
Measures pay off: moving in the right direction 328
Customers argue against complacency: demand for more 332
Our own independent assessment 334
Honoured at home and abroad 337
Emulating our success 339
The right to know; the duty to inform 341
Compliance with the Master’s Voice 344
In conclusion 345
Chapter Fifteen: Behind the Scenes 347
The Invisible Partners 347
Hard times: understanding who to work with 348
Surely, something had to be done 350
Challenges with the measures taken: staff protests 357
A timely lending hand: the Board and Union support 358
The campaign for change 359
Doing the inevitable 361
Other staff concerns 367
In their own words 369
David Isingoma 369
Silver Mugisha 370
Charles Odonga 371
Johnson Amayo 372
Encouraging managers and staff initiatives 374
Chapter Sixteen: Friends in Need 377
Suppliers and Service Providers 377
Need for credit facilities and discounts 378
Shortfalls in the procurement system 379
One-by-one corrective measures 380
The turnaround: confidence restored 384
Advice, information and training 385
The black sheep 387
Two tales of friends in need 389
The service provider’s perspective 389
The supplier’s perspective 391
Looking back 391
In conclusion 392
Part Five: YES WE DID 395
Chapter Seventeen: Can Public Enterprises Perform? 397
Final Thoughts 397
The privatisation debate 397
Reforming public enterprises without changing ownership 399
Proactive management 400
Setting focused priorities 401
Putting the customer first 402
‘Do-it-yourself’ approach 403
Investing in the workforce 404
Stretching dreams and plans to the ‘stars’ 405
Making the case for public enterprises 405
A move to access financial markets 407
Looking back to forge ahead 408
Acknowledgements 413
Acronyms 417
Bibliography 421