Public sector needs professional managers says WB Country Director | Sunday Observer

Public sector needs professional managers says WB Country Director

Public sector enterprises need to have KPIs and it is necessary to introduce a performance management culture. It is also important to understand the objectives of these entities. This was highlighted at the launch of the hand book ‘Good Governance for Chairmen and Board of Directors of Public Enterprises’ by the Chartered Institute of Sri Lanka in Colombo last week.

“Lack of professional management is the main reason for losses in the public sector. A test of ‘fit and proper’ should be carried out to ensure good governance. Credible and trustworthy institutions build on credibility will have public acceptance,” World Bank, Country Director Dr. Idah Pswarayi-Riddihough said.

“International experience shows that there is a strong correlation between good governance and performance. There are many negative impacts due to corruption and therefore, it is essential that quality institutions be in operation,” she said.

Stressing the importance of strengthening the country’s good governance  process, Dr. Idah said that there should be a conducive environment and accountability with regard to the public sector.

“There are 400 State Owned Enterprises (SOEs) in operation in Sri Lanka. They play a huge role in socio-development of the country. They contributed Rs 1.5 trillion to the economy which was 30 percent of the country’s GDP in 2016. Their impact on achieving socio-economic development is enormous. However, according to a research finding, it shows that many Sri Lankans are not happy with the performance of SOEs,” she said.

Sri Lanka needs to implement policy reforms and good governance practices which will have beneficial impact on fiscal consolidation. “We will fully support the efforts to implement the good corporate governance practices initiative. There should be a holistic approach where transparency and accountability will lead to competition which in turn will raise the performance bar,” she said.

Good governance will increase the service delivery of SOEs. It is also necessary to improve the legal framework and to set up a central clearing house. The hank book launched should be implemented to ascertain positive results, she said.Speaker Karu Jayasuriya said loss-making SOEs have incurred a loss of as much as Rs. 25 billion over the past several years and this needs to be rectified. With the good governance practices, enormous losses to the economy could be stopped.

Public enterprises play an important role in the delivery system. Since 2015, far reaching steps have been taken to supervise SOEs and with the implementation of good corporate governance practices these enterprises could be turn around, “The hank book which is a PPP initiative is well timed and relevant in today’s context. What is of paramount importance is the right selection of the board of directors who are responsible for the entity’s performance. A report released in 2007 highlighted that 40 percent of the funds allocated for projects go waste and this situation has now improved, he said.


This applies to the corporate sector as well as private business houses as well. Without proper systems structured, process driven management systems that are data monitored to support decision making, competitiveness in the global market is unlikely to be sustainable. Not even the banks have fully digitized operating systems with the result that they are unable to offer the public a seamless digital service. Manufacturing is far behind and services seem to have lost their way a long time ago. Tasks and their related activities, the timing and rational configuration of tasks to make jobs, the configuring of these jobs along systems structures with infrastructural and technological support, the formulation, initiation, support, guidance and sustenance of processes, the monitoring and optimization of performance, position and scale are all unknown to almost all corporate directors and managers who still inhabit a world of personality driven organizations where volatility, screaming at subordinates, intimidation and sometimes contracted violence rule the roost. Along with the cut-throat "leg pulling" organizational cultures that are widespread this is the primary driver of "Brain Drain". A nation with a very small population of 20 million people who have an average IQ of just 79 which borders on mental retardation has no choice other than to "import" as much intelligence as it can in order to increase that average to around 95 which is what is required if it is to realize its potential to emerge as the entrepot to capital flowing into the regions of IOR-ARC, SAARC, BIMSTEC and ANTARCTICA and a transhipment point for resources, commodities, manufactured goods and services flowing out from these regions to the rest of the planet.