Energising Performance: The Case of the Nuclear Directorate of the Health and Safety Executive


Headquartered in Bootle, Merseyside, the Nuclear Directorate (ND) of the Health and Safety Executive (HSE) is responsible for the safety regulation of Great Britain's nuclear power stations, nuclear chemical plants, decommissioning activity, defence nuclear facilities, nuclear safety research and nuclear related waste facilities; regulating the security of civil nuclear facilities, and operational safeguards matters. With about 400 employees (most of whom are highly specialized in scientific, security and engineering based disciplines), ND comprises seven divisions, such as Civil Nuclear Power Regulation, Defence Nuclear Facilities Regulation and the Office for Civil Nuclear Security (which is responsible for regulating security in the civil nuclear industry to prevent the sabotage of nuclear facilities and the theft or sabotage of nuclear materials). The Nuclear Directorate, originally the Nuclear Installations Inspectorate, came into existence 50 years ago to ensure workers and the public were protected from the hazards of emergent nuclear energy technology. It has been in its current form since 1st April 2007, when the security activities of the Office for Civil Nuclear Security and the operational nuclear safeguards work of the UK Safeguards Office were transferred from the then Department of Trade and Industry, now Department for Business Enterprise & Regulatory Reform, along with associated staff to the HSE.


Championed by Mike Weightman, HM Chief Inspector of Nuclear Installations Inspectorate and Director of Nuclear Directorate in the spring of 2009 ND began the process of building and implementing a strategic performance management framework. At that time, ND was facing several significant challenges that triggered the requirement for more consistent and focused performance management, as Planning Manager Kathy Donnelly explains: "Mainly because of how the organizational structure had evolved over the years and because of the diversity of responsibilities, the seven Divisions of the Directorate were essentially operating as different organizations under one umbrella," she says. "Each Division was quite different in how it planned and how it managed performance." Therefore, there was an identified need to drive consistency in performance management across the Divisions. Alongside this Donnelly states that the senior team also wanted the organization to focus on the outcomes of its work, rather than more narrowly onto outputs or processes. The need to inculcate greater consistency of performance as well as "organizational oneness," across the Divisions was sharpened by the fact that as of early 2009 there was a plan to transition ND from a public sector civil service organization to a statutory corporation that operationally would more closely resemble flexibilities associated with a private sector organization while remaining within the public sector, and having a different focus.


Creation of the strategic performance management framework was facilitated by the Advanced Performance Institute (API). Donnelly explains how API came to be chosen as the expert external advisors. "I came to the Directorate from another part of HSE and with the challenges that we were facing I began a search for best practices in managing and integrating planning, strategy and performance management," she says. "I attended a course run by Bernard Marr [API's Chief Executive Officer and Director of Research] which described API's approach and methodology. I retuned to the Directorate and began to sell the concept internally, with a view toward getting support for our own implementation."

Shortly afterwards Marr gave a presentation to ND's senior management team. With support from the senior team gained, most notably the Chief Inspector Mike Weightman, the process to build the strategic performance management framework began. Donnelly states that Marr's obvious weight of expertise and experience and the fact that he could demonstrate significant successes from his involvement with other organizations were critical contributors to the programme receiving the go-ahead and subsequent success.


Although still early in its usage of the framework, Donnelly states that the ND has already experienced significant performance benefits. For example the framework, she says, has enabled much better and descriptive communication to both internal employees and external stakeholders, which includes Government Ministers, as to the strategic aims of the organization and how that achievement will be realized." Furthermore the framework is proving invaluable in helping to drive what we call our 'transformation programme'," she says. "The programme has three strands - regulatory effectiveness, organizational effectiveness and openness and transparency. We have made sure that the transformation programme links to and is captured on the Plan-on-a-Page."


The Nuclear Directorate's Plan-on-a-Page, which is the top level of the performance framework (from this page it is possible to drill down to supporting KPQs, etc), is shown in Figure 1. Naturally, given the critical importance of ND's work, the mission statement steers everything the organization does: 'Securing the protection of people and society from the hazards of the nuclear industry.' Delivering to this mission is not a 'nice to have' but a non-negotiable performance imperative.Scrolling down the Plan-on-a-Page (or Strategy Map), the mission is supported by three outcomes, which represent the key goals of the organization, such as: 'A Nuclear Industry that controls its hazards effectively.' These outcomes are supported by five core activities (which ND must master if it to deliver the outcomes) such as

'Influence Improvements: We influence change to create an excellent health, safety and security culture among the operators and to promote sustained excellence in nuclear operations,' and 'Engage our Stakeholders: We have an open and transparent dialogue with all our stakeholders'.

Finally these core activities are supported by nine performance enablers (the people, IT and financial capabilities required to deliver the activities) such as 'Culture and Integration: We have a strategy-driven and performance-oriented culture', 'Operating Environment: We understand the nuclear industry and the environment we operate in and 'Resource Management: We manage our resources effectively and efficiently enhancing value for money,' (given the pressures on the UK public sector - see below - this objective will certainly receive much attention in the years ahead, but ND does recover around 98% of its cost from industry. Although each objective is described through just one sentence on the Plan-on-a-Page (critical for ease of communication, amongst other reasons) a fuller description is provided within the wider framework that includes the KPQs and KPIs. For example, Engage our Stakeholders is more fully defined as: 'To operate effectively we need to engage with all our stakeholders. This will lead to an open and transparent effective regulatory dialogue with all stakeholder groups and an open understanding approach to regulation. This will be proactive to ensure we brief stakeholders regularly to avoid reactive and defensive responses.' It is clear how this Plan-on-a-Page has distilled the three strands of the transformation programme into focused and practical objectives. Focus in ensured by the fact that the map contains just 17 objectives. As Donnelly rightly observes: "It would have been far too easy to have built a Strategy Map that describes everything the organization does, rather than taking the time to identify the critical few objectives that make a real difference to the delivery of our mission and strategy."


Ensuring that the Plan on a Page did not balloon into something that was more akin to an organizational map than a Strategy Map was something ND's senior team was keen to ensure from the outset of the design process which, in keeping with API's methodology, began with individual and anonymous interviews between API and the 12 members of the Directorate's management board. This was followed by a feedback session in which API presented the first draft Plan-on-a-Page. The management team then went though several iterations of debating and refining the map. Following this stage, ND took the Plan-on-a-Page for wider consultation amongst the employee base as well as the Trades Unions. Donnelly highlights the support and involvement provided by the Trades Unions. "They could see the benefits of what we were trying to do," she says. "Also they had been actively involved in the changes that were under way as we were planning to transition to a statutory corporation so are positive about change and performance improvement." To ensure buy-in and understanding ND involved a large number of its employees (up to 30%) from all levels and all Divisions in the Plan-on-a-Page consultation process. "This process took several months but was definitely worthwhile," comments Donnelly. "It was useful in getting staff to understand the process and what we were trying to achieve as an organization and for their seeing how their day-to-day work contributed to the objectives on the Strategy Map." She adds that there was some debate on the precision of the wording on the map and that from the various workshops they received great insights as to what employees thought were the most important drivers of ND success. As cited, she says that one challenge was that some staff wanted everything that the organization does to be included on the Directorate Strategy Map. "But you can't do that at the highest level, you have to be more focused," she says.


With the Strategy Map in place the next step was the formulation of the KPQs. An API innovation, KPQs serve as bridge between strategic objectives and KPIs. A KPQ is a management question that captures exactly what managers want to know when it comes to reviewing each of their strategic objectives. The rationale for KPQs is that they focus attention onto what actually needs to be discussed when an organization reviews performance and most importantly, provides guidance for collecting meaningful and relevant performance indicators. By first designing KPQs organizational leaders are able to ask themselves: "What is the best data and management information we need to collect to help us answer our key performance questions?" As cited by API clients in other case studies that can be found in resource section of the API website, ND's Donnelly is quick to stress the importance of KPQs. "KPQs are extremely valuable," she says. "They've made a huge impact on how we've thought about performance improvement and have really concentrated the minds of managers on what really makes a difference to performance and what our real information needs are, rather than just thinking about what we can actually measure." As with the number of objectives that appear on the Strategy Map, ND has been careful to limit the number of KPQs. "We're really looking to ensure that we have as few as we need but enough to cover the whole map," explains Donnelly. The KPQs were mainly developed by the senior management team. However heads of units also had some input as "they would be managing the people who did the work on a day-to-day basis that would deliver to our mission," says Donnelly. "So it was critical that they were comfortable with the information requirements that were being defined through the question." Consider these as sample Directorate KPQs. The Core Activity: 'Reputation: We manage our reputation as a world leading, independent nuclear regulator," is supported by two KPQs: • How confident are all of our stakeholders in our ability to effectively regulate the nuclear industry? • How does our reputation compare to that of other regulators? As a further example the performance enabler: 'Resource Management: We manage our resources effectively and efficiently enhancing value for money.' Is supported by three KPQs: • To what extent are we putting our resources where the biggest hazards are? • To what extent are we becoming more effective and in the use of our resources? • How well is our spending justified for external scrutiny?


At the time of preparing this case study, ND was still completing the process of identifying its KPIs, although it has made some good progress. However, Donnelly says that selecting appropriate KPIs is difficult in some of the 'softer' areas. "For example, one of the areas of our Strategy Map is how we influence our nuclear site licensees - the people that actually produce the energy and who are responsible of the safety of their activities - to make sure that they have the highest level of nuclear safety and security culture, given that you cannot regulate a culture." She says that measuring influence is something of a challenge. However she adds that there are areas that are much easier, such as how ND ensures compliance, as there is much here that is clearly measurable. Importantly, however ND is not waiting until they have the full complement of KPIs before using the framework as a management tool or holding review meetings, but is rather working with the initial KPIs that are in place and will work with the new ones as they come online. ND held its first formal quarterly review of performance to the Plan-on-a-Page in July 2010.


The Directorate has certainly made good progress in aligning strategic initiatives/action programmes to the objectives on the Strategy Map, as Donnelly explains: "In April 2010 we held a workshop with the management board and all of the heads of units where we assessed every programme that we were currently running and analyzed how they linked to the Strategy Map and therefore contributed to the delivery of our strategic goals," she says. "If there was anything that we were currently doing that wasn't making a clear contribution then we should stop doing it."


Another step to towards clear goal alignment across the organization the strategic performance management framework has been cascaded to Divisional levels. This was done in workshops with the Divisional heads and their teams who mapped their activities against the Corporate Plan on a page to ensure that their own strategic objectives were aligned fully. As the heads of divisions were involved in creating the Directorate level framework it was an easy process which both confirmed the validity of the Corporate Plan on a page and ensured all activities carried out the Divisions will contribute to its achievement.


Another intention is that a virtual team is created across the Directorate. Individuals would be assigned responsibility for performance management within each of the seven Divisions. Presently the performance management framework and process for the whole Directorate is managed by Donnelly and a staff of two. This small team collects all of the information required to populate the map and creates the reports. However Donnelly says that putting in a virtual team may prove difficult at present, as the public sector spending cuts means that a strict recruitment freeze is in place. Of course, the public sector spending cuts within the UK are going to have a dramatic impact on all branches of Government and for many years ahead. Donnelly certainly agrees. "To be honest I think the Strategy Map will be vital if we are to be successful in the face of the upcoming challenges," she says. "From one viewpoint the map and framework will enable the Directorate to clearly communicate and demonstrate the value of what it does. From another perspective it will provide the Directorate's management team with the tools for better resource management as well as giving real insights into our business. We will be able to ensure that we are investing resources into the most important areas and are spending money appropriately." She adds: "I think that over the next couple of years the Strategy Map will really prove its worth for the Directorate."


Donnelly concludes by offering three critical factors for succeeding with a strategic performance management framework. "Firstly, and most importantly, is senior management buy-in and support and their actively championing of the process," she says. "Without this it is difficult to drive change across an organization." Secondly she says that it is important to try to involve as many people as possible. "We found this really useful as it was a great way of communicating why we were creating the framework and how it impacted the work of all staff," she says. "If we hadn't done this there would have been a real danger that staff would badge it as yet another management initiative. Their buy-in would then have been much more difficult to secure." Donnelly offers 'persistence' as a third critical success factor. "To keep this whole process moving there has to be dedicated and committed people that are willing to keep pushing it forward until everyone's on board and everybody understands what the organization is trying to achieve with the Plan on a Page and the rest of the framework. If this energy is not applied then it is unlikely that such a programme will succeed."

Bernard Marr is a globally regognized big data and analytics expert. He is a best-selling business author, keynote speaker and consultant in strategy, performance management, analytics, KPIs and big data. He helps companies to better manage, measure, report and analyse performance.
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