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Industrial Data
versión impresa ISSN 1560-9146versión On-line ISSN 1810-9993
Ind. data vol.25 no.1 Lima ene./jun. 2022 Epub 31-Jul-2022
http://dx.doi.org/10.15381/idata.v25i1.20870
Production and Management
Level of Management Performance of the Provincial Municipality of Chota: A Methodology for Local Governments
1 PhD in Public Management and Governance from Universidad César Vallejo. Currently working as an independent consultant (Chiclayo, Peru). E-mail: riquimejia@hotmail.com
This descriptive, quantitative, non-experimental (non-probabilistic, targeted sample) and cross-sectional research aimed to determine the level of management performance of the Provincial Municipality of Chota (MPCH). The results showed that the MPCH has a low level of efficiency, effectiveness, collaboration, transparency and ethics; therefore, it was concluded that an analysis of the municipal administration from the “New Public Governance” and “Institutional Strategic Planning” dimensions provided a methodology to diagnose the management of the MPCH, which may be useful for other local governments.
Keywords: public governance; institutional strategic planning; municipal management.
INTRODUCTION
Determining the level of municipal management performance is a key task for decision making and for which exist various methodologies. However, in this research, the management of the Provincial Municipality of Chota (MPCH) was analyzed from five core dimensions that emerge from the principles of New Public Governance (NPG) and the phases of institutional strategic planning (ISP), thus contributing to knowledge (epistemology), through the identification of successful past experiences and a relevant theoretical framework (ISP Theory and Modernization Theory [MT]). This study is relevant because it supports the improvement of municipal management, from a diagnosis based on a methodology. Also, it is novel because it provides a tool for the diagnosis of municipal management, calibrated and aligned to current standards and to the NPG trend. In addition, it expands upon the topic, as the methodology may be used by other local governments, according to their particularities.
Upon this premise, there are clearly factors that limit effective public management in Latin American and Caribbean (LAC) countries, despite the efforts of governments (Inter-American Development Bank - IDB, 2018; Organization for Economic Cooperation and Development [OECD], 2020). There are constraints such as the disruption of the ISP cycle (elaboration, monitoring and assessment) that influence inconsistent state spending (deficiency) versus the prevalence of poverty (ineffectiveness) (Comisión Económica para América Latina y el Caribe [CEPAL], 2017; Instituto Latinoamericano y del Caribe de Planificación Económica y Social [ILPES], 2017). This causes dissatisfaction with public administration among the population, i.e., delegitimization (Jara & Cedeño, 2019), which is mainly found in municipalities labeled as deficient institutions that neglect the needs of their inhabitants (Aguilar, 2016). Seeing that local governments depend economically on the central government (Arias, Retamal & Ramos, 2019), interest in ISP is low (Ortega & Parra, 2019) and dialogue on institutional transparency is postponed (Foglia & Rofman, 2020).
In Peru, there are also factors related to the inadequate coordination of the ISP that limit effective municipal management, since the projects implemented are not included in the investment program designed in the planning phase (Ministerio de Economía y Finanzas [MEF], 2018). This can be attributed to the fact that, in Peru, planning represents an unnecessary expense (Ministerio de Vivienda, Construcción y Saneamiento [MVCS], 2017). For instance, 100% of the existing municipalities (1874) failed to spend 28% of their budget (inefficiency) in 2018 (Congress of the Republic, 2019), which could have been used to reduce poverty affecting 20.5% of Peruvians that year (Instituto Nacional de Estadística e Informática [INEI], 2019a) as a consequence of inappropriate public spending (Olivos & Quiñones, 2016). As a result, municipalities are considered unreliable by citizens (INEI, 2020; Casiano & Cueva, 2020).
Likewise, there are factors related to inadequate spending in the municipalities of Cajamarca region that limit their management, as 29% of the budget allocated for the 15 provincial and 114 district municipalities (INEI, 2019b) was not spent in 2018 (deficiency) (Congreso de la República, 2019). It should be noted that Cajamarca holds the first place in poverty and extreme poverty (inefficiency) in the country (INEI, 2019a).
In turn, the MPCH, also presents factors related to inadequate institutional planning that limit its effective management, showing a lack of articulation between its various plans, which are outdated (Municipalidad Provincial de Chota, 2016). This mismatch may have influenced the MPCH to not spend 45.2% of its Modified Institutional Budget (PIM) in 2019 (Presidencia del Consejo de Ministros [PCM], 2020). This can be interpreted as inefficiency against poverty that ranges between 41% and 55.1% in Chota (INEI, 2020).
In view of this challenging context, the general objective of the research was to determine the level of management performance of the MPCH, developing a methodology based on the theory of ISP and MT. It is justified by its contribution to decision-making and the continuous improvement of municipal management based on real data collected and processed using an appropriate methodology, considering that there is evidence that local governments, such as the MPCH, have factors that limit their management, thus the study contributes to generating knowledge and methodology in this regard.
BACKGROUND
Background information and theories were identified for the theoretical framework of the research study.
At the international level, it was found that a low level of transparency has an impact on democracy and the aspirations of citizens; that is, on sustainable development, which shows that the population increasingly demands information through different means of communication and participation (Liuta & Mershchii, 2020). However, municipalities present low levels of transparency and promotion of citizen participation in planning (Ramos & Viana, 2019).
In terms of planning and management, municipalities present low legitimacy and cross-sectoral collaboration (Synnevåg, Amdam & Fosse, 2019), which evidences a lack of political interest in this matter (Kousgaard, Scheele & Vrangbæk, 2019), as well as a weak ISP (Chukwuneme & Potgieter, 2018). It is then demonstrated that institutional planning is important, as it contributes to the continuous improvement of municipal management (Piedra, 2018).
In addition, there was evidence of poor implementation of good public governance practices in local governments (Camilo, Manenti & Yamaguchi, 2018), deficient public spending that leads to citizen distrust (Dzuke & Naude, 2017) and poor personnel training that hinders the execution of municipal planning (Rayo & Puerta, 2017).
Furthermore, municipalities disclose little information about their management on their web portals (Manfredi et al., 2017), and unethical municipal actions also exist (Dimeski & Karadzoski, 2017); therefore, there are challenges regarding accountability and inter-institutional collaboration to render local management transparent (Hernández, 2016).
A poor knowledge and innovation management was found to be the cause of inadequate local administration (Molina et al., 2016), and the feeble fight against unbecoming conduct of public servants results in inadequate municipal management (Hallunovi, Osmani & Bashi, 2014). Thereby, ISP is a key tool in the management of public entities (Da-Fonseca et al., 2014).
At the Peruvian level, it was determined that there are challenges in local administration (Quispe de los Santos, 2020). There is also poor strategic planning, few mechanisms and apps for the diffusion of knowledge and information, and institutional divorce (Daza, 2017). All this gives rise to inadequate spending that hinders local sustainable development (Fernández, 2016). It was also found that the planning process is inadequate, as the lack of coordination between the three levels of government prevails (Andia, 2016). Apart from the poor implementation of the planning process and inadequate spending, it was observed that management depends on the central level (Sánchez, 2014).
Theories
The research was based on the following theories: continuous improvement theory (CIT), ISP, MT and municipal management theory (MMT).
Continuous Improvement Theory (CIT)
To address the theory of continuous improvement means to delve into the widely used Kaizen philosophy (Alvarado & Pumisacho, 2017; Suárez & Miguel, 2008 cited by Hincapié-Montoya, Zuluaga-Correa & López-Zapata, 2018). According to this philosophy, any activity performed by an organization can be done better, based on a gradual organizational ideology, incorporating all human talent in the drafting and implementation of objectives, indicators, goals, techniques, technology, training and standardization of improvements through policies to mitigate mistakes (Prata & Giroletti, 2017; Mihaila, Bădicu & Jieri, 2019).
ISP Theory
The concept of ISP has evolved over many paradigms (Organización de las Naciones Unidas [ONU], 2012), and is defined as a systematic process of phases (elaboration, monitoring, evaluation) to achieve objectives (Fiallos, 2017). According to CEPAL (2017, p. 7), es un acto político, una teoría y una disciplina [it is a political act, a theory and a discipline] that translates into empowerment and vision towards the future. It is a political act, because the government must solve the problems of the population, by planning development in a collaborative manner; it is a theory, because it became a modern planning with articulated phases (elaboration, monitoring, assessment) that provide feedback and continuous improvement to the systems; and it is a discipline that seeks to generate leadership.
Planning is the means whose end is development (CEPAL, 2017). It is a comprehensive public process that provides a route for a country to achieve its objectives that are part of the planning tools, where the body responsible for the role of planning development is the Sistema Nacional de Planeamiento (CEPAL, 2019).
From the above, it can be deduced that ISP is cyclical (Arroyo, 2016; Alguero, Britto & Fuentes, 2018) and that it has mechanisms tied to a critical path (Sánchez, 2015).
As of 1962, the year in which this process began, strategic planning in Peru has evolved, with reforms in 2002 such as the National Agreement, the creation of the Sistema Nacional de Planeamiento Estratégico [National Strategic Planning System] - SINAPLAN and the Centro Nacional de Planeamiento Estratégico [National Center for Strategic Planning] - CEPLAN, from which planning is managed through different regulations such as Directive No. 001-2017-CEPLAN/PCD, from which continuous improvement is implemented in ISP linking plans and budgets at all levels of the Peruvian government.
As ISP guides the management of SINAPLAN institutions, it becomes a management instrument that provides the PliegoTN1 with the strategy to achieve its objectives over a three-year period (Centro Nacional de Planeamiento Estratégico [CEPLAN], 2019).
During the elaboration or amendment of ISP, the institution outlines its mission, objectives and institutional strategic actions with their respective indicators, considering the priority (route) among other aspects ((CEPLAN, 2019).
The follow-up allows analyzing its progress by measuring goals that were assigned to the objectives, strategic actions, operational activities and investments, through systemic information that provides early warnings ((CEPLAN, 2019). There are several tools for this such as Smart Reports and the balanced scorecard (Soares, Silva da Rosa & Ensslin, 2017).
A comprehensive assessment is carried out to evaluate ISP, identifying the aspects that contribute to or limit its compliance.
Modernization Theory (MT)
The Modernization Theory advises that entities are key instruments of a government to achieve its agenda, using different organizational structures to meet the requirements of the population (Secretaría de la Función Pública de los Estados Unidos Mexicanos, 2015). There was a breaking point that revealed the inability of public management to address the unmet needs of citizens, which led to the modernization of public management in order to achieve legitimacy and effectiveness (efficiency and effectiveness), which gave rise to New Public Management (NPM) and New Public Governance (NPG) (Secretaría de la Función Pública de los Estados Unidos Mexicanos, 2015).
Management then shifted from the Weberian model based on the efficiency of the administration to the NPM, which incorporated effectiveness to achieve goals; nevertheless, several countries are currently using the NPG, incorporating other principles such as collaboration (CO), transparency (TR) and ethics (ET) (PCM, 2019b).
Efficiency makes it possible to determine the quality of the public based on interventions and their costs versus intervention results (Porto, Garriga & Rosales, 2018), indicating that in municipal administration it is analyzed using the Índice de Esfuerzo Fiscal Municipal [Municipal Tax Effort Index] (IEFM) based on municipal revenue collection to implement ISP (MVCS, 2019).
Likewise, efficiency in municipal administration is assessed by means of the Índice de Ejecución de Inversiones Municipales [Municipal Investment Placement Index] (IEIM), analyzing investment execution and assessing expenditures for local development projects (MVCS, 2019).
On the other hand, collaboration focuses on participatory decision making by gathering the knowledge, feelings and experience of public servants, beneficiaries and stakeholders (PCM, 2019b).
Transparency is the key to good governance that serves the population’s right to access public information (Spano, 2016); it responds to the population’s demands for information about what money is spent on, forcing public officials and public servants to be accountable (PCM, 2019b). In this matter, the current trend is ex officio transparency, under which public institutions offer citizen-friendly information via their websites (Abeleida et al., 2019).
Ethics contributes to the materialization of collaboration and transparency, for it is more than mere compliance with rules, but rather a regulatory framework with collaborators motivated in the establishment of new management models (PCM, 2019b).
The above factors influence the modernization of the public sector, as it is aware of the reality, understanding that people are different and suffer from similar problems; however, they need different solutions (PCM, 2019bThis leads institutions to use suitable management mechanisms to provide timely attention to the needs of the population (PCM, 2019a). For this purpose, Law No. 27658, Framework Law for the Modernization of State Management, is in place, along with the implementation of the Public Management Modernization Policy to 2021, orienting its interventions to results, where government modernization is materialized by the ISP.
MMT
First, it should first be noted that management refers to the role of administration (Galinelli et al., 2015). In general terms, it is closely related to the phases of administration, so that administration is equivalent to management and, specifically, that it consists of organizing collaborative work to achieve institutional objectives (Galinelli et al., 2015).
Municipal management is based on decentralization, tied to the concept of territorial decentralization, which consists of providing local and regional governments with autonomy and a budget (Henríquez, 2020). From the above, municipal management (MM) occurs through administrative procedures to address the needs of the population of its territorial jurisdiction, by planning local development (Chávez et al., 2018).
As for Peruvian municipalities, according to Law No. 27972, Organic Law of Municipalities, they are territorial bodies that promote local development, providing services and representing their citizens because they are close to them; likewise, they have political, economic and administrative autonomy (Ley N.° 27972).
Local governments plan their territory in a comprehensive and participatory manner, ensuring access to public information and social monitoring, for which they are accountable to the populations, who are empowered to revoke the mandate of the mayor and councilors if they do not comply with their functions (Ley N.° 27972).
As such, municipalities are the immediate institutions that respond to citizen demands in their area (Machín et al., 2019).
Municipal management influences the quality of life of citizens (Victoria & Mamani, 2017); therefore, adequate management is a citizen right (Arcila & López, 2019) where strategic planning is an essential element (Dyadik, 2014), as there is evidence that it contributes to improve municipal management (Barati-Stec, 2015).
METHODOLOGY
A questionnaire consisting of five dimensions (identified in the theoretical framework and representing a methodological proposal aimed at assessing municipal management) with 17 items was used in this positivist, quantitative, descriptive, non-experimental (non-probabilistic with a targeted sample) and cross-sectional research, and it was applied to 20 MPCH employees. The questionnaire was validated by three expert specialists and calibrated using a pilot test that yielded a Cronbach’s alpha of .990, indicating its high reliability, thus it was applied for data collection, data was then cross-checked with a documentary review and observation sheets.
This research followed a sequential transformational design, as shown in Figure 1.
RESULTS
The diagnostic of the MPCH followed a methodology designed on the basis of the theoretical framework identified in this research, which can be used by other local governments according to their particularities. For this purpose, a questionnaire was applied to 20 employees of the del Servicio de Administración Tributaria [Tax Administration Service (SAT)] of the MPCH, resulting in the prevalence of a low level in the five dimensions analyzed, which limit the MPCH management. Results are shown in Table 1.
Table 1 Perception of the Level of Efficiency, Effectiveness, CO, TR and ET in MPCH Management.
Source: Prepared by the author.
As observed above, efficiency levels of the MPCH were found to be very low (50%) and low (40%), respectively; thus, 90% of the respondents consider the management of the MPCH to be inefficient. This perception is related to the fact that 90% of respondents perceive there to be inadequate spending.
An analysis of the MPCH’s spending over a five-year period was carried out to validate this perception following a document review by means of a friendly expenditure query in the Ministry of Economy and Finance (MEF) of Peru, revealing that the MPCH spent an average of 61.44% of its Modified Institutional Budget (PIM) over the period 2015-2019 (see Table 2), confirming that there are spending limitations.
Table 2 PIM and ICEGM of the MPCH 2015-2019.
Source: Prepared by the author.
* Municipal Budget Spending Capacity Index.
The low level of efficiency of the MPCH can be attributed to the fact that all respondents perceive that the MPCH does not raise enough of its own resources for the execution of ISP. Over the period 2015-2019, the MPCH collected on average only 5.06% of its total revenues (see Table 3), indicating a very low municipal tax effort index and a budget that depends on the central level.
Table 3 IEFM of the MPCH 2015-2019.
Source: Prepared by the author.
*Obtained from the sum of municipal taxes and directly collected resources.
Additionally, the low level of efficiency of the MPCH can be attributed to the disagreement of respondents with the fact that the services and projects included in the Multi-Annual Investment Program are not those contained in the MPCH’s ISP.
Respondents perceived the level of effectiveness of the MPCH to be very low (65%) and low (20%). This is related to the respondents’ disagreement (90%) that the ISP should be considered in the formulation of the MPCH’s Institutional Operating Plan (IOP) and that there is a lack of scorecards and checklists to follow-up on ISP, for which reason they do not issue reports in accordance with CEPLAN’s standards. In addition, 85% of the respondents perceive a lack of coordination between areas regarding the implementation of the ISP.
This perception was cross-checked with information from the MEF and it was determined that the MPCH had an average IEIM of 52.15 in the 2015-2019 period (see Table 4); in other words, 47.85% of investment expenditure was not spent, which could have influenced the perception of the respondents.
Table 4 IEIM of the MPCH 2015-2019.
Source: Prepared by the author.
*Obtained through non-financial assets.
The very low (65%) and low (20%) level of collaboration within the MPCH can be attributed to the fact that respondents perceive a lack of association between planning documents at the central and regional levels, requiring the establishment of working groups with MPCH staff and focus groups with local stakeholders and CEPLAN representatives for the formulation or updating of the ISP.
This perception was cross-checked with a documentary review of the MPCH and CEPLAN for the 2015-2019 period, revealing that there are two ISPs prepared by consultants, but neither MPCH staff nor territorial stakeholders were involved in their elaboration. Furthermore, neither of the ISPs is accompanied by a report issued by CEPLAN and only the one elaborated in 2019 is registered in the CEPLAN V1 application, a situation that may have contributed to the perception of the respondents.
In turn, the very low (75%) and low (10%) level of transparency in the MPCH administration can be attributed to the fact that 85% of the sample perceives that no public hearings are held to account for the ISP nor is relevant information about this document published in its transparency platform, Portal de Transparencia Institucional (PTI). There are no ISP reports available according to CEPLAN regulations, nor is ISP information available as open data to the public.
This perception was cross-checked with a documentary review, revealing that, during two administrations comprising the period 2015-2019, informative events such as town meetings were held; however, no information or accountability on the implementation of the ISP was provided. Also, neither ISP monitoring information nor open and user-friendly data for the population based on MPCH management indicators were available in the transparency portal of the MPCH, which could have determined the perception of the respondents.
On the other hand, the very low (75%) and low (10%) level of ethics in the management of the MPCH is attributed to the fact that respondents perceive that there is no socialization of the ISP so that all collaborators are aware of it, since there is a lack of training in methods, instruments and manuals for the ISP cycle as required by CEPLAN.
This perception was cross-checked with a documentary review, revealing that the MPCH does not train employees in methods, instruments and techniques for the ISP cycle (preparation, monitoring and evaluation), there is a lack of manuals for the ISP cycle pursuant to CEPLAN and adapted to the management of this local government, and there are no IPS improvement plans, which may have influenced the perception of the respondents.
DISCUSSION
From the observation of the present reality (R) and the theoretical model devised (T), it is clear that, according to Quispe de los Santos (2020) and Camilo, Manenti and Yamaguchi (2018), challenges prevail in municipal management, as good public governance practices are yet to be adopted. According to Piedra (2018) and Da-Fonseca et al. (2014), ISP is a key instrument that contributes to the continuous improvement of municipal management; however, and as pointed out by Daza (2017) and Sánchez (2014), there are limiting factors in the municipalities that prevent compliance with the ISP cycle, few instruments for knowledge management and applications for information dissemination.
It was determined that the MPCH (Ox) has factors that limit its management such as low levels of efficiency, effectiveness, collaboration, transparency and ethics.
Thus, the low level of efficiency of the MPCH is based on the perception of the respondents, on inadequate spending and the low level of its IEFM. This finding coincides with that of Arias et al. (2019), who state that municipalities are highly dependent on the central government budget and also with that of Fernández (2016), who states that municipalities show deficient public spending.
In turn, the low level of effectiveness of the MPCH is supported by the perception of the respondents and the inadequate capital investment expenditure, reflected in its IEIM, which is consistent with Dzuke and Naude (2017), who refer that deficient public spending leads to citizen distrust.
The low level of collaboration is supported by the perception of the respondents, the low participation of MPCH collaborators and key territorial stakeholders in the elaboration of the IPSs, as well as the fact that none of these accounts for evaluation reports issued by CEPLAN as stipulated by the norm. Indeed, as pointed out by Synnevåg, Amdam and Fosse (2019), and Kousgaard, Scheele and Vrangbæk (2019), municipalities present a low level of cross-sectoral collaboration and legitimacy in institutional strategic planning due to their low interest in it and, as indicated by Chukwuneme and Potgieter (2018), and Andia (2016), due to their inadequate strategic management and strategic leadership.
The low level of transparency of the MPCH is based on the perception of respondents, inadequate accountability that is not based on the ISP, lack of ISP follow-up and monitoring information in the MPCH transparency platform ITP, and lack of an open data platform to inform the population of the ISP. As Liuta and Mershchii (2020) noted, all those aspects have an impact on democracy and the aspirations of the citizens; in other words, on sustainable development, for which reason people demand more information through the different communication media. The foregoing coincides with the statements of Ramos and Viana (2019) and Hernández (2016), according to whom local governments show low levels of transparency and citizen participation in planning, since, as stated by Manfredi et al. (2017), municipalities disclose little information about their management on their web portals and, as pointed out by Molina et al. (2016), poor knowledge management and innovation lead to inadequate municipal management.
The low level of ethics of the MPCH is based on the perception of the respondents, on the deficient training of the personnel in methods, instruments and techniques for the ISP cycle, on the lack of manuals for the ISP cycle aligned to the CEPLAN methodology and standards adapted to the management of this local government. Such premises are consistent with Rayo and Puerta (2017), who attribute the non-compliance with the ISP cycle to poor human resource capacities; furthermore, as stated by Dimeski and Karadzoski (2017), municipal unethical actions prevail, an observation that coincides with that of Hallunovi et al. (2014), who indicate that the scarce promotion of ethics generates inadequate municipal management.
CONCLUSIONS
From the analysis of the present reality (R) and the theoretical model devised (T), it was concluded that challenges prevail in municipal management in LAC, Peru, the Cajamarca region and in the MPCH, providing a relevant theoretical framework that made it possible to design and apply a methodology to diagnose the management of the MPCH, which could be used by other local governments, since by analyzing municipal management from the dimensions of New Public Governance and Institutional Strategic Planning, real information with scientific rigor is obtained for decision-making and continuous improvement.
From the application of this methodology in the diagnosis of the MPCH (Ox), it was concluded that there are factors that limit its management such as low levels of efficiency, effectiveness, collaboration, transparency and ethics. These factors can be overcome if an Institutional Strategic Planning Manual (MPEI) that considers efficiency, effectiveness, collaboration, transparency and ethics as a component in its three phases (preparation, monitoring and evaluation) is prepared and implemented, for ISP is a key instrument that contributes to the continuous improvement of municipal management.
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Received: August 04, 2021; Accepted: December 16, 2021
Este es un artículo publicado en acceso abierto bajo una licencia Creative Commons
