'Service directors will stand or fall on the quality of their service and that alone,' Mr Elliston said.
'Hackney has been undermined by departmentalism, lack of strategic purpose and a culture of mediocrity. We are now engaging on the most radical restructuring in local government which will enable us to move from being one of the worst to one of the best local authorities in the country.'
Four executive directors will replace the current six directors, and nine service directors will replace 14 assistant directors. None of the present directors, who are all still in post, has yet declared an interest in applying for the new posts, retiring or seeking work elsewhere.
The service directors will agree key outcomes and performance goals with the executive directors and members, against which their performance will be
measured. Each will control their own budget.
The council will develop a league table of 100 top indicators. Service directors will be held accountable for achieving results such as processing benefit forms within a set number of days.
Hackney is keen to be one of around 40 councils the Labour government will choose to pilot its 'best value' alternative to CCT.
Mr Elliston said: 'Value as a concept is going to be a big part of our thinking. If they are looking for pilot areas, we'd be very interested in being part of that because, in terms of local government, it would seem to be the one really big idea.'
The top management structure was agreed in February 1997, the new service directors will be in post by September and the reorganisation will be completed by 1 January.