Many human services – health care, education, aged care, disability support, community services and correctional services – are delivered by government agencies or by private and not-for-profit providers which are funded directly or indirectly by government. Key to significant productivity gains in the delivery of human services lies is the reform of operational management at the front-line. 

Detailed studies of successful productivity reform at this level are rare but essential for understanding how the effectiveness and efficiency of public services can be improved. Our detailed case study on the John Morony Correctional Centre in NSW has begun to fill the evidence gap and provides practical and detailed insight into what governments could do to deliver better public services and substantially improve the productivity of the non-market services sector. 

John Morony is widely considered to be a success story in public service reform. They have achieved substantial and sustained improvements in quality and cost, including reductions in assaults, sick leave, and operating costs, and improvements in inmate employment rates and out-of-cell hours. 

Five factors were critical to the successful reform at John Morony: 

1. Challenge: The right to manage the facility was contested and put out to competitive tender. The ‘in-house’ public sector team proposed a radical change when faced with this contest, which was the winning bid against three multinational corporations. 

2. Focus on the front-line: The reform focused on the front-line unit that delivered day-to-day services, especially the management team of this unit. 

3. Performance management: The performance management approach for John Morony was successful because it set out clear objectives and gave management certainty and space to innovate, whilst holding them accountable for results. 

4. Financial management: The management team received a predictable stream of payments in return for delivering services. They also faced meaningful incentives, including financial abatements, if they failed to meet targets. 

5. Commitment: The performance and financial management approach was captured in a quasi-contractual agreement that set out what management would deliver and how it would be measured, consequences for success and failure, what financial resources would be made available to deliver those results and over what period of time. 

These are valuable insights but they are based on a single case study. The opportunity to roll this approach out in other correctional facilities will further build our understanding of what works, as well as test the generalisability of these critical success factors.