This research is a systematic study on the management evaluation system of public institutions in Korea, which had been systemized based on legal ground earlier than other advanced nations. The management evaluation system of public institutions in Korea is a means of control and oversight for public institutions by the Ministry of Strategy and Finance which has the ownership over the country’s public institutions. The management evaluation system of public institutions is an institution evaluation which involves program evaluation as well. The evaluation system, as described by Radin (206), has functioned as a management mechanism for improving the performance, accountability, and transparency of public institutions. The empirical studies which surveyed public corporations in Korea report that the introduction of the management evaluation system has enhanced the organizational capacity, productivity, and profitability. Quasi-governmental organizations which have adopted the management evaluation system since 2004 are also regarded as having improved their general business performances after the adoption; however, proving the effectiveness of such empirical improvements would be difficult as productivity or performance indicators of core businesses of individual quasi-governmental organizations are hard to be compared with one another. Such quasi-governmental organizations, however, also see improvements in their customer satisfaction as well as other primary administrative performances such as cost containment and expense reduction. However, as Daley(2003) mentioned, since the management evaluation system has been expanded to quasi-governmental organizations as well as public corporations and strengthened its follow-up measures such as the official suggestion for the dismissal of executives and differentiated incentives depending on the evaluation results, problems such as inevitable subjectivity of the evaluation, comparison between institutions due to relative evaluation, transposition of evaluation and goals, and the lack of consistency in performances have been arising. Public institutions file reasonable complaints about increasing burdens of the evaluation while public labor unions argue that the management evaluation of public institutions is so centered on profitability that the evaluation obstructs public institutions from pursuing public interests.
In 1984, the management evaluation system as it is now, was introduced and has been in the processes of forming, settling and expanding in the country. The system reinforcement phases can be observed under the following 4 criteria - evaluation type, number of public institutions subject to the evaluation, evaluation indicators and the contents, and the turning points of average incentive payment rates. Period of change can be divided into four – from 1972 during the Jeonghee Park administration period is an introductory or beginning period, the Duhwan Jeon administration is a formative period during which the Framework Act on Public Institutions Investment Management was established to give a legal ground to the evaluation and the management evaluation model was developed as it is now. From the year 1998 and the Daejung Kim and Muhyeon Noh administrations are the period when the evaluation was expanded and settled beyond government investment organizations to their controlled agencies as quasi-governmental organizations and thereafter the evaluation continued to be reinforced. As the management evaluation system has been continually fortified, public institutions have seen increasing burden of evaluation accordingly; this inevitably produced sprawling controversies over the evaluation objectivity or infringement of public interests.
Moreover, Budgetary Program Assessment (BPA, Korean PART) is also being conducted above the institution evaluation and institution head evaluation consisting the current management evaluation system as a means to control public corporations and quasi-governmental organizations, further increasing public institutions’ burden of evaluation. Diverse voices and a variety of academic research have been demanding consistency between similar evaluation systems on public institutions; +however, the complexity and multi-layered nature of subagent or responsibility relationship between various government organizations and individual public institutions complicated vertical or horizontal connections among various performance evaluation systems of the government.
For the management evaluation system, which has changed and developed for over 3 decades, the academia, National Assembly and even national organizations like the Audit Inspection Board are all pointing out problems such as the single evaluation system, classification of evaluation types, focus on short-term performances, representativeness of evaluation indicators, excessive use of evaluation results, infringement of public organization’s management autonomy, expertise of evaluators, and the lack of fairness.
A comparative look at the management evaluation systems of public institutions in the UK, France, Sweden, New Zealand and China, reveals that they are much different from each other in their roles and significance in their national economies as they have different historical, political and economic backgrounds. As such, ownership agency, the number of public institutions subject to central government management or evaluation, and the evaluation models and methods for performance evaluation differ in each country. Despite the slight differences that exist between countries, evaluation on financial and non-financial business performances of public institutions, especially public corporations, has been reinforced by central financial authorities of each country. In the UK, France, and Sweden, in particular, government authorities holding the ownership of public corporations directly and indirectly interfere into the public corporations’ administration by appointing executives, investment decisions, privatizationplans, and other administrative strategies while constantly inspecting their functions and conducting performance evaluations. What is common about these advanced countries’ management policies for public institutions is that a government authority with the ownership of public institutions is involved both directly and indirectly in the improvement of their governance structure and conducts constant monitoring and evaluation on their management to improve business performances of public institutions.
The present research has surveyed public institutions’ performance evaluators and employees for the current management evaluation system that has been in place for about 30 years in the country and its future improvements. The two groups identically answered that the present evaluation system has contributed to the improvement of management efficiency and the responsibility of public institutions, however, on the other hand, infringed management autonomy of public institutions. The two groups also responded that the current management evaluation indicators well represented business performances of public institutions; however, they showed different opinions on the representativeness of indicators regarding evaluation by the general public, contribution to the society, labor-management relations, and core businesses. As for quantitative indicators, in particular, evaluators, rather than employees of public institutions, were found to believe that the indicators do not accurately represent the business performances of public institutions. Regarding future improvements, both groups all agreed to the following needs: the need to fortify public interests, to apply differentiated evaluation models between public corporations and quasi-governmental organizations, to diversify evaluation period, to include non-classified public institutions into the management evaluation system, and to consider the nature of a public institution’s business services and its size in classifying the evaluation types.
In recent theoretic discussions on the management evaluation, Shadish, et al. (1991) proposed a tailored evaluation; Funnell and Rogers(2011), an effectiveness-oriented evaluation; and Patton(2011), a developmental evaluation from traditional performance evaluation. In this research, we studied previous literatures on the current management evaluation system of public institutions, relevant government agencies’ advices, and opinions of experts and employees of public institutions. And we proposed a comprehensive set of improvement plans. The main improvements of the new management evaluation model are as follows; first, we differentiated the existing evaluation model for public corporations and for quasi-governmental organizations and allowed flexibility in the evaluation period and the evaluation indicators for each evaluation type. Second, we established evaluation indicator menus for each evaluation type and modularized sub-evaluation indicators and their significance weights for each evaluation type and individual public institutions. Such improvement strategies, of course, may face difficulties to be implemented immediately due to possible conflicts of interest among stakeholders. However, the current management evaluation system is deemed to be improved since it is a means to restore the horizontal relationship between evaluators and the evaluated, to improve performance and accountability of public institutions, and to ultimately innovate and enlighten public institutions and their employees.
- 공공기관 경영평가제도 분석과 새로운 모형 개발(An analysis and a proposal for restructuring the management evaluation system of public institutions in Korea)
- 라영재; 윤태범
공공기관 경영평가제도 분석과 새로운 모형 개발(An analysis and a proposal for restructuring the management evaluation system of public institutions in Korea)
|Subject Country||South Korea(Asia and Pacific)|
|Subject||Industry and Technology < Entrepreneurship|