Creating High Performance Government: A Once-In-A-Generation Opportunity

CREATING HIGH PERFORMANCE GOVERNMENT: A ONCE-IN-A-GENERATION OPPORTUNITY
The Campaign for High Performance Government Robert F. Wagner School of Public Service New York University Paul C. Light, Professor and Director
Funded with support from the Truman Foundation and the Robertson Foundation for Government June 21, 2011
EXECUTIVE SUMMARY
Confidence in the federal governments ability to respond effectively to national and international, economic and political problems continues to dwindle. Some of these complaints are a clear reaction to political ideology, deepening polarization, and the recent budget battles, but they all reflect a core of reality. Americans remain divided on what the federal government should do in these difficult, uncertain times, but are increasingly convinced that the federal government must work better, and at lower cost. The question is what can be done to both design and implement a comprehensive reform agenda that would create the high performance government Americans want and so desperately need. This report provides an overview of the accountability, efficiency, and productivity challenges facing Congress and the president as they consider a broad overhaul of the federal bureaucracy, and offers possible reforms that might improve performance as part of a package of comprehensive action, as well as a discussion of one method for bipartisan legislative implementation. The report also provides estimates of the potential savings involved in such a package with the caveat that better performance also involves investment in the basic resources needed for improvement. This report is built on the simple premise that the time for small-scale reform has passed. Congress and the president have a once-in-a-generation opportunity to improve government for the long-term. It has been seventy years since the last comprehensive review of the federal governments basic structure and operations. There is simply no time for another blue-ribbon commission of the kind chaired by former president Herbert Hoover during the late 1940s and early 1950s. Moreover, as Appendix A to this report shows, there are already plenty of good ideas for action circulating through Congress and the executive branch. The challenge is to push these and other ideas forward soon enough to create a government that works better and costs less.
The Campaign for High Performance Government Robert F. Wagner School of Government New York University
THE CASE FOR REFORM

Many Americans have come to believe the worst about the federal government. Some of these doubts are rooted in partisan conflict and a drumbeat of anti-government rhetoric, but some are rooted in the escalation of government failures. Americans pay close attention to the news of the daythe sluggish jobless recovery, terrorist plots, poorly supported soldiers, poisoned food, vacancies in the top jobs of government, waste and improper payments to undeserving citizens and corporationsall which seemingly reinforce the federal governments persistent inability to assure the highest performance possible. As exaggerated as some of the criticism may be, there is more than enough evidence of lapses in performance to fuel the distrust. Political polarization is both a reflection and a cause of the perceived administrative failures. But there is enough evidence imbedded in recent governmental breakdowns, ethical breaches and outright fraud to feed the distrust. While low rates of trust may temporarily favor a minority party, radical shifts in legislative majorities over the past few election cycles are further proof that the American people are desperate for change. In short, this is not a partisan issueRepublicans and Democrats alike have been and will be held accountable for governments poor performance. There is no question that trust has reached a dismal low. Even as they demand deep budget cuts, Americans want more of virtually everything the federal government delivers. At the same time, they have come to believe that Washington is trying to do too much in these trying times, and are increasingly frustrated (52 percent) and even angry (25 percent) with the federal government. Only 21 percent of Americans interviewed last year said they were basically content with government, while only 25 percent said they trusted the government in Washington just about always or most of the time. Although the anger subsided somewhat in 2011, the frustration remains. For most Americans, the problem is not so much what government does, but how it works. The past two National Commissions on the Public Service focused on what the first commission called a profound erosion of public trust and the quiet crisis in government performance. The 1989 Commission warned, such distrust, if continued, may undermine the democratic process because it acts as a disincentive to potential recruits who too often associate public life with frustration or breaches of integrity. Fifteen years later in 2003, the second National Commission on the Public Service concluded that this quiet crisis had become a deafening roar. We see the result in unsuccessful, redundant, wasteful, and counterproductive efforts in government.
THE THREE BARRIERS TO HIGH PERFORMANCE GOVERNMENT

Every president since Franklin Roosevelt has entered office promising government reform, but none has quite succeeded. Instead, todays federal bureaucracy remains anchored in organizational strategies and structures invented in the 1930s and rarely updated since. If major financial, health and education overhauls are indeed sorely needed to improve the quality of life of Americans, Paul Volcker has argued, so too is a federal service reform that will equip the federal government with the tools that I need to successfully implement reforms and carry out existing missions. This is not to argue that the federal government fails at every turn. Federal employees accomplish miracles every day, often struggling against the bureaucracy to create measureable impacts through their work. Moreover, most Americans agree with the federal governments basic missionno sensible person wants to weaken cancer research and the prevention of life-threatening pandemics, the effort to protect food, drugs, and water, leadership in science and technology, and least of all the assurance of a highly effective and affordable national defense. But in order for the federal government to perform at its highest-level comprehensive reform is needed to solve the three challenges that continue to erode the performance that Americans deserve: The Accountability Challenge: With the governments ever-expanding mission, it is often impossible to know where the buck stops or what agency is responsible for the execution of which task. Not only is the federal governments program agenda riddled with duplication and overlap, it remains encumbered by administrative structures that diffuse accountability and confuse the chain of command. The bureaucratic bloat is easiest to spot at the top of the federal organization chart in the proliferation of needless management layers. In a sentence, there have never been more layers in government or more leaders per layer. The total number of senior officers increased from 451 in 1960 to more than 2,600 in 2008. More than 500 of these senior posts require Senate approval, but move through the White House and Senate at such a sluggish pace that it now takes more than a year on average for an administration to finally fill these top positions. Accountability is not only lost up the vertical hierarchy within departments and agencies, but it is also lost along the horizontal chain of coordination between duplicative and overlapping programs. According to the Government Accountability Office, there are seven departments and agencies currently working on U.S.-Mexican border water quality, and 20 involved in managing federal cars, trucks, and airplanes; there are also two-dozen presidential appointees on top of programs to prevent bioterrorism; the FBI and Bureau of Alcohol, Tobacco, Firearms and Explosives are still working in separate silos on controlling explosives; there are now 15 agencies assigned to food safety and separate health programs for each of the armed services; and there are 18 programs for food assistance, 44 programs for employment and training programs, 54 programs for financial literacy, 80 programs for economic development, 82 for teacher quality, 100 programs for surface transportation. The Effectiveness Challenge: The public perception that government is both ineffective and inefficient fosters mistrust in governments willingness to do its job well, particularly at a time of huge deficits, rising expenditures while the private sector continues to seek excellence in efficiency and innovation. American people are right to worry about fraud and waste and abuse. Much more of the governments work today is outsourced, without clear guidelines as to the net benefits or costs of such an approach. In 2008, the federal government spent $188 billion on noncompetitive contracts, a figure that increased by 229 percent since 2002 ($84 billion). Additionally, cost-reimbursement contracts, which are highly inefficient, grew from $71 billion in 2000 to $135 billion in 2008. A major part of the inefficiency problems likely come from the state of federal procurement professionals themselves. The Acquisitions Advisory Panel found that since 1999 the size of the acquisition workforce has remained relatively stable, while the volume and complexity of federal contracting has mushroomed.
The acquisition workforce is only one part of the federal governments under-performing administrative infrastructure: Thirty years after Congress and the president created the Office of Inspector General to monitor government economy, efficiency, and effectiveness, the offices are understaffed and rarely focus on how to prevent mistakes early enough in the regulatory and legislative process. Twenty years after Congress and the president created Chief Financial Officers in every agency to produce audited financial statements, there continues to be a lack of financial discipline and systems for reducing wasteful expenditures. Fifteen years after Congress and the president enacted the Government Performance and Results Act, many agencies are unable to measure the impact of their programs as a tool for rewarding high performance and winnowing failure. Finally, more than a decade after Congress and the president created Chief Human Capital Officers and Chief Information Officers in every agency, the federal governments information systems remain antiquated and poorly designed, while the federal governments human capital system continues to fail at virtually every task it undertakes.
Rebuilding this infrastructure is essential for assuring the highest-possible performance across government. Statutes must be revitalized and enforced, while agencies must provide the leadership to assure a full embrace of the need for change. The Productivity Challenge: Poor leadership, scarce or misaligned resources, and underperforming staff within the federal government have led to a federal workforce that is inconsistent at best. Yet a highly productive federal workforce is critical to high performance. The governments ability to prevent a crisis, respond to a disaster and to answer routine but important requests and needs of citizens depends on the strength of its leaders, well trained workforce and teams that have the resources necessary to complete its tasks. The greatest barriers to a productive and energetic workforce are a lack of performance incentives and disciplinary actions, unqualified leadership and insufficient training. Leadership at the federal level has been inconsistent at best, negligent at worst. Leaders of agencies typically are often too focused on policy instead of management; and in the worse cases, they are unqualified and serve solely a political purpose. Only 44 percent of federal employees believe that the leaders of their organizations generate high levels of motivation and commitment in the workforce. Similarly, 45 percent said that they were satisfied with the policies and practices of their senior leaders. This leadership crisis is especially critical now as a large portion of the workforce faces retirement (the percentage of the workforce that was older than 55 rose by more than 60 percent between 1998 and 2008). Compared with the private sector, the government has failed to create strong incentives for high performance. Automatic pay raises and inflated employee evaluations have done little to encourage productivity. In fact, 45 percent of the federal workforce believes that pay raises do not depend on how well employees perform their jobs; 41 percent do not believe that steps are taken to deal with a poor performer who cannot or will not improve. Although many agencies have created their own pay systems to improve productivity, efforts to implement pay-for-performance systems have generally been unsuccessful.
PRACTICAL REFORMS
There is no shortage of compelling ideas for improving government performance today. To the contrary, the problem is not a lack of ideas, but too many ideas that tackle relatively small issues and lack strategies for implementation. Congress and the President are deluged with good ideas for action but are often frustrated by a scoring system that undervalues management reform. Simply put, if government reform is into a scorable event it is not considered a legislative priority. It is time to consider a comprehensive reform package as a visible signal to the American public and the federal establishment that the time for piecemeal reform is over. Not only would a comprehensive package produce greater accountability, effectiveness, and productivity in government, it could reduce the federal debt by as much as $1.5 trillion over the next decade. Driven forward by an action-forcing mechanism such as a variation in the military base-closing commissions, Congress and the president should be able to reach agreement on a list of common-sense, but high value reforms. Consider the following list of reforms and estimated savings as a possibility: ACCOUNTABILITY 1. Eliminate 1,500 Senate-confirmed presidential appointees and presidential at-will appointees in the non Career Executive Service and the Schedule C classification category. Estimated Savings: $1 billion 2. Reduce the number of management layers in the federal hierarchy by half, while setting a goal of no more than six layers between the president of the United States and the service delivery layer of the hierarchy. Estimated Savings: Positive, but not yet scorable 3. Rebalance the federal workforce to eliminate senior level positions that are not essential to an accountable, efficient and productive government: a. Reduce the number of higher-cost GS 13 to 15 managers and professionals using a one-for-two ratio replacement ratio after they separate or retire. This ratio would be implemented after evaluating and rating each vacancy as essential before it is filled or eliminated. b. Strengthen the service delivery levels of government by increasing the number of employees using a two-for-one replacement ration after they separate or retire. c. Create a pay-go system for the creation of new presidential positions and management levels. The PAYGO system would prohibit the creation of any new appointed positions and layers without a one-in-one-out policy. Estimated Savings: Positive, but not yet scorable
4. Strengthen oversight of government performance by increasing the number of acquisition, information technology, inspector general, and Government Accountability Office employees. Estimated Savings: Positive, but not yet scorable
5. Use the Government Performance and Results Modernization Act not only to establish priorities to measure success and eliminate non-essential programs, but also to target mission overlap, and to divide agencies and bureaus with conflicting missions. Estimated Savings: Positive, but not yet scorable 6. Require Congress to prepare and review administrative impact statements for all pending legislation. Estimated Savings: Positive, but not yet scorable 7. Make sure the Congressional Budget Office has the staff and expertise to score management reform with the same dedication used to score policy proposals. Estimated Savings: Positive, but not yet scorable
EFFICIENCY 1. Set a goal of achieving at least $1 trillion in savings over the next ten years through an aggressive attack on wasteful government spending: a. Eliminate at least half of the $150 billion in federal improper payments within five years, and all improper papers thereafter. b. Dispose of the federal governments unnecessary real property, including 14,000 properties that are underutilized or vacant. c. Eliminate the $300 billion backlogs of delinquent tax through aggressive collection efforts, and prevent further delinquency through effective enforcement. d. Consolidate and thereby sharply reduce, the number of separate data centers, while developing effective standards for sharing data across agencies and with the public. e. Streamline the federal acquisitions process, while enhancing competition and planning. f. Terminate failed weapons systems, information technology projects and new programs at the earliest sign of failure, thereby reducing the amount of sunk costs in unworkable programs. g. Reduce the contract workforce (now estimated at 7.5 million jobs) by 500,000 positions. Estimated Savings: $1 trillion 2. Identify all duplication and overlap across federal programs followed by immediate consolidation. Estimated Savings: $100 billion 3. Improve and encourage innovation in the federal government: a. Establish innovation investment funds within all federal agencies for improved government effectiveness.
b. Expand the Obama Administrations SAVE award to include a one billion dollar-plus savings award with a $100,000 prize to individual or team that presents it. c. Invest in programs for preventing long-term costs by early interventions in areas such as juvenile diabetes, early childhood education, literacy, health research, and technology development. Estimated Savings: Positive, but not yet scorable
PRODUCTIVITY 1. Establish accurate and effective measures of government productivity, and set a goal of a three percent gain in productivity each year. Estimated Savings: Positive, but not yet scorable 2. Streamline the presidential appointee process. Congress needs to enact legislation requiring: (1) the President to make nominations within 120 days of a vacancy; (2) the Senate limit the personal use of holds to no more than 30 days; and (3) the Senate to discharge its advise and consent within 120 days hence. Estimated Savings: Positive, but not yet scorable 3. Create an effective results-based pay-for-performance system for all federal employees and/or work groups and units based pay for performance, while building effective training and monitoring systems for assuring fairness in the system. Estimated Savings: Positive, but not yet scorable 4. Provide leadership, resources and training for high performance government: a. Reform the Senior Executive Service (SES) to restore its original intent as highly mobile and talented workforce. b. Identify federal training budgets as a line item in the Presidents budget and set a goal of increasing training to match private sector investment. c. Expand hiring opportunities for bringing outside talent into jobs at all levels of government, while limiting automatic promotions and step increases based on time on the job and seniority. d. Accelerate and streamline the hiring process to reduce delays in replacing essential employees. Estimated Savings: Positive, but not yet scorable 5. Establish precise definitions of pay comparability that measure job requirements as the basis for implementation of the Federal Employee Pay Comparability Act, while basing pay comparability on the expertise needed to perform specific jobs. Estimated Savings: Positive, but not yet scorable

IMPLEMENTATION
There have been a number of suggestions over the past 20 years, including the creation of the office of federal management (OFM) within the EOP, a new bipartisan commission modeled on the two Hoover Commissions of the 1940s and 1950s, a civilian fast track commission modeled on the military based closing commissions, and restoration of the presidents reorganization authority. All of these proposals share a concern for both identifying and fast-tracking legislative action, but do not provide the needed administrative capacity and agility for quick deficit relief. The challenge is to meld fasttrack consideration with the deep analysis and judgment needed for making difficult decisions. Moreover, the kind of comprehensive action described above requires a clear mandate, adequate staffing, and full authority to act, including fast-track reorganization authorityin short, a new quasi-independent government agency tasked to act. 1. Establish a Government Reform Corporation to develop legislative proposals for immediate action through fast track, up-or-down votes. The federal government already has modest experience with the use of special agencies to dispose of troubled assets, outmoded programs, obsolete agencies, and demobilization. The most notable recent success in using quasi-governmental corporations for reorganization involved the Resolution Trust Corporation (RTC), which closed 750 thrift companies totaling $400 billion during its five years in operation. Building on the RTC model, a Government Reform Corporation (GTC) could do the same for the federal government as a whole. Operating as a time-limited, highly-agile, quasi-independent agency, the GTC would have full authority to submit reorganization plans with fast-track consideration by Congress and the President.
THE THREE CHALLENGES FACING HIGH PERFORMANCE GOVERNMENT

Every president since Franklin Roosevelt has entered office promising government reform, but none has quite succeeded. Instead, todays federal bureaucracy remains anchored in organizational strategies and structures invented in the 1930s and rarely updated since. If major financial, health and education overhauls are indeed sorely needed to improve the quality of life of Americans, Paul Volcker has argued, so too is a federal service reform that will equip the federal government with the tools that I need to successfully implement reforms and carry out existing missions. This is not to argue that the federal government fails at every turn. Federal employees accomplish miracles every day, often struggling against the bureaucracy to create measureable impacts through their work. Moreover, most Americans agree with the federal governments basic missionno sensible person wants to weaken cancer research and the prevention of life-threatening pandemics, the effort to protect food, drugs, and water, leadership in science and technology, and least of all the assurance of a highly effective and affordable national defense. But in order for the federal government to performance at its highest-level comprehensive reform is needed to solve the three challenges that continue to erode the performance that Americans deserve.
THE ACCOUNTABILITY CHALLENGE A clear chain of command and mission-oriented agencies are necessary components of a high performance government. But as the federal governments responsibilities have increased over time, so too has the distance between the top and bottom of the hierarchy, and the number of agencies with overlapping and conflicting missions. As a result, accountability has been lost in a dense thicket of reporting relationships, leading to miscommunication, poor coordination and the failure to connect the dots at the most critical of times. These trends need to be reversed in order to avert further failures and to ensure the faithful execution of the laws. The federal government is now responsible for an agenda of staggering reachfrom Social Security to food safety to the war in Afghanistan. Over time, new positions, agencies and responsibilities have been added in a piecemeal fashion without dismantling the outmoded bureaucratic structures that existed before. The federal government now has more layers of management and more people occupying each position than at any other point in history. This thickening of government leads to miscommunication as information is distorted and delayed while passing through layer upon layer of the hierarchy. Meanwhile, as Presidents take on new responsibilities and Congress divides up agencies like turf, agencies have been assigned increasingly overlapping and conflicting missions. Overlapping missions lead to poor coordination as agencies fail to share key information with each other and accountability lines become obscured. Conflicting missions mask the governments priorities and compromise its ability to fulfill its essential responsibilities. LAYERING Current Reality The federal government has more layers of leaders and more leaders per layer than ever before. The number of bureaucratic layers increased significantly in 1930s under the New Deal and further accelerated with President Johnsons Great Society, Nixons administrative presidency, and the 1978 Civil Service Reform Act, which gave the President greater power in overseeing the newly formed Senior Executive Service (SES). As a result, new positions have grown rapidly at the upper and middle levels of the bureaucracy while many front-line jobs have either been erased by new technologies or contracted out to private firms.
The evidence from federal personnel records is revealing: The total number of layers at the top of government grew from 17 in 1960 to 64 in 2004. At the middle levels, the addition of office directors, division chiefs, bureau heads, and their assistants alone added 20 layers and 13,000 occupants to the departmental hierarchy between 1980 and 1992. The number of lower-level employees fell from 780,000 to 525,000 between 1983 and 2003.
Layering has produced two notable trends in the executive hierarchy. First, the number of senior executives and presidential appointees increased dramatically from 451 in 1960 to 2,592 in 2004. The numbers are even more revealing at specific executive levels: between 2001 and 2009, Executive Level III and V appointees have increased by 73 and 47 percent, respectively. Second, layering has produced a long list of new titles, many of which are variations of the five titles subject to Senate confirmationsecretary, deputy secretary, under secretary, assistant secretary, and administrator. The assistant secretary position, for example, had 43 occupants and 2 layers in 1935 and 1,439 occupants and 8 layers a half century later. The only way to increase the number of executive level presidential appointments is through amendments to the Title V of the U.S. Code. Lesser constraints apply at lower levels, where positions are created and eliminated by presidential and secretarial orders, but action is still required. On a broad level, bills are introduced, debated, and passed; orders are explained and promulgated. But while much of the layering in government is buried in procedures so arcane and minute as to be incomprehensible to outsiders, there is enough evidence on the creation of new Title V positions to suggest a simple two-step process: first, new positions and layers are established; then, the new posts spread throughout the bureaucracy as departments try to keep up with one another. Creating and Justifying New Positions New positions are generally established through several types of legislation such as creation of a new cabinet department or agency, authorization of a new program, expansion of an existing program, or establishment of a new government-wide post. The justification of an additional post varies according to which type of bill is used to create it. Cabinet bills provide the clearest and lengthiest justification for new positions since Congress subjects such bills to relatively serious legislative scrutiny. Single authorization bills also provide clear rationales for new positions, as authorizing committees are compelled to justify new posts in the departments they oversee. Annual department-wide authorizations are designed to cover so much ground that justifications for new posts are often vague or left out altogether. At the very top of the federal hierarchy, for example, legislative histories suggests a broad inventory of reasons for creating new positions at the very top of the federal hierarchy: (1) aid in the recruitment of a prized appointee; (2) boost morale of a specific unit; (3) smooth the transfer of a unit out of one department into another; (4) ease the workload of beleaguered executives; (5) improve accountability; (6) expand the stream of advice to another senior officer; (7) make a symbolic statement about a national priority; (8) elevate or equalize the status of similar positions in government. This legislative record points to two seemingly contradictory reasons for the endurance of layering over time. On the one hand, layering endures as new positions are justified during the creation of often duplicative and overlapping programs. On the other hand, new positions are easily added because there is no price assigned to doing so. Most significantly perhaps, new positions are often replicated by other agencies in an effort to meet the accepted notion of the good agency, resulting in a ripple effect of bureaucratic growth across the federal government. For instance, presidents may conclude that every department needs some new lever of power; or Congress may expand an experiment, such as the creation of the inspector general position, to every corner of the executive establishment. Copying existing positions, as opposed to creating new ones, is
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relatively easy since Congressmen and their staffs routinely borrow language from previous authorizations to justify new personnel needs. The evidence speaks for itself: Senator Daniel Patrick Moynihan described an organizations instinct to copy existing bureaucratic structures the iron law of emulation. Emulation occurs in four ways: (1) coercion: organizations are forced to accept new positions such as chief financial officer and chief human capital officer; (2) mimicking: organizations copy the latest fads in titles such as chief of staff; (3) norms: organizations follow what they believe are the structural outlines of the good organization, and; (4) evasion: agencies use titles and the promotions that go with them to compensate for pay freezes or recruit talented employees at lower salaries than they might otherwise earn. Bureaucratic Resistance to Change A bureaucracys ability to resist painful change is another factor that explains the federal governments increased layering over time. Indeed, the addition of new positions would not constitute large-scale layering if outdated positions could be removed with the same ease. But government agencies and departments are not neutral tools of executive direction; rather, they are energetic participants who become passionately interested in their own survival. Herbert Kaufman persuasively captured this reality in his book, Are Government Organizations Immortal, when he concluded that agency advocates have a large arsenal of weapons to employ in their agencies defense. They cultivate their allies and the mass media. Covertly and openly, they attack and try to embarrass their adversaries. They strike bargains to appease the foes they cannot overcome. If this sounds like warfare, it isat least a type of warfare, a struggle for organizational existence. Kaufmann traced 175 organizations from 1923 to 1973, and found that 148, or 85 percent, were still alive at the end of the fifty-year period. He went on to outline a series of factors that contribute to an agencys ability to safeguard from undesirable change: Agencies often have multiple allies/champions in Congress Many agencies are insulated from departmental and even Presidential control An agency leader has enormous professional incentives to ensure its survival, and is particularly resistant to the dismemberment of its structures. Agencies often have allies outside of government who advocate on their behalf. Making significant changes to the bureaucratic structures of agencies generally requires legislative action; but the legislative setting favors the status quo.
Problems with Current Reality The central problem with such unfettered bureaucratic growth is that it ultimately leads to a diffusion of responsibility that makes it nearly impossible to hold government officials accountable for their actions. This larger outcome is the result of a number of more immediate outputs, including the miscommunication and delay that result from passing information through layer upon layer of the hierarchy, and the glacial pace and vacancies that result from the presidential appointments process. Miscommunication The rapid growth of bureaucratic layers has both decreased the accuracy and slowed the pace of information transmission up and down the hierarchy. Like the childhood games of telephone or gossip, messages often change dramatically as it moves from the bottom of the hierarchy to the top, and vice versa. The result is predictable distortion as information moves up, down, or across agencies, which separates
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agency leaders, Congress, and the president from action on the ground. Such miscommunication has been seen in virtually every federal failure over the last thirty yearsfrom the unheeded prior to the 2009 Christmas Day bombing attempt, to the aborted leads that might have alerted the FBI and other agencies to the 9/11 attacks. In each case, lower-level employees tried to send information upward, only to be rebuffed at the middle or higher levels, giving secretaries and administrators ample cover to profess a lack of knowledge about the problems below. Delay and Vacancies with Presidential Appointments Increased layering in government has also resulted in many more layers of political appointees than ever before. This development has contributed to increased delays in both the nominating and confirmation processes over the last half centuryfrom 2.4 months under Kennedy to 3.4 under Nixon, 4.6 under Carter, 5.3 under Reagan, 8.1 under Bush, and 8.5 under Clinton. As a result, many presidents are left without key appointees in place for many months after taking office, which undermines agencies ability to execute the laws and to be held accountable. Moreover, since presidential appointees serve for just 18 to 24 months on average, the top officers of government begin to leave even as new officers are still arriving. These delays and vacancies leave agencies alarmingly understaffed and ill-equipped to carry out the missions under their jurisdiction. For example, in March of 2009 the Treasury Department was charged with stabilizing the financial markets and leading the administrations economic recovery plan, all with about 18 vacant senior positions, amounting to virtually the entire upper echelon of the department aside from Secretary Tim Geithner. While many of these appointees were actually working informally for the department prior to their confirmations, their lack of official authority severely limited their capacity to effectively carry out their duties.
Past Efforts to Address Layering Grace Commission On June 30, 1982, President Reagan issued an executive order establishing the Presidents Sector Survey on Cost Control (PSSCC), commonly referred to as the Grace Commission for its chairman, J. Peter Grace. The commission was charged with identifying waste in the US Federal Government and making recommendations for how to increase efficiency and cost savings by executive or legislative action. The Grace Commission also marked the beginning of the so-called bulge project, which attempted to reduce the number of midlevel workers by 40,000 within the federal bureaucracy. Concluding that there were simply too many employees clogging up the middle ranks of government, the commission noted that only 26% of private sector middle and upper level management personnel are employed at a level comparable to GS-11 and above, compared to 72% in the Federal Governmenti.e., a Government concentration 2.8 times as great as that in the private sector. In order to address this imbalance, the commission recommended reductions in the number of temporary positions, broader supervisor/subordinate spans of control; and deep cuts in the number of management layers between the top and bottom of the federal hierarchy. Pros Brought greater attention to the midlevel bulge as a growing problem warranting serious discussion and debate. Cons Over-stated savings likely to result from implementing its recommendations. Congress ignored commission recommendations in the years following their release. Failed to make headway on reducing ranks of middle management.
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President Reagan and his management agencies were not committed to successful implementation of the proposals.
Reinventing Government President Clinton created the National Performance Review on March 3, 1993, and put Vice President Gore in charge of the effort. The campaign began with a simple mission: to create a government that works better and costs less. President Clinton initially saw NPR as a means for achieving quick budget cuts, but Gore expanded NPRs scope to include a broader review of how the federal government worked. Overall, NPR included three different phases, and produced recommendations on issues ranging from improving government operations to overseeing departmental mergers to restoring trust in government. One central rationale for these recommendations was that the federal government had become unwieldy with too many bureaucratic layers between top managers and frontline workers. Therefore, it was necessary to thin out the ranks of midlevel managers in order to better focus organizations on their work and improve their responsiveness to the public. Pros Reinventing government met its downsizing goals with a substantial reduction in the size of the federal civilian workforce. Increased span-of-control ratios, from 8:1 in 1992 to 11:1 in 1997.
Cons Most of the personnel savings came from the Department of Defense, which closed hundreds of obsolete bases following the end of the Cold War. An untold number of the 40,000 reduction in managers were achieved by converting managers into managerial support specialists and team leaders who continued to exert management responsibilities. The vast majority of the job cuts involved attrition on the frontlines of government, which eroded at least some capacity to execute the laws.
Efforts to Limit Executive Branch Political Appointments On March 8, 2010, Senators Russ Feingold (D-WI) and John McCain (R-AZ) introduced a bill to cap the number of presidential political appointees at 2,000, marking a one-third cut. The Senators noted that the number of political appointees had increased by 28% since the end of the Carter administration, and cited a Congressional Budget Office report estimating that these cuts could yield savings of nearly $900 million over ten years. The bill was immediately referred to the Committee on Homeland Security and Governmental Affairs, but it has not made any headway since. Senators Feingold and McCain introduced virtually identical legislation to the Senate in 1995, 1997 and 1999, and Feingold tried again without a co-sponsor in 2001, but none of these efforts were successful. In the House, former Representative Bill Luther (D-MN) introduced identical versions of the bill in 1999 and 2001, with the same result. The closest they came was in 1995, when Senators Feingold and McCain managed to pass their legislation as an amendment to an appropriations bill. However, the amendment was later killed in the appropriations conference committee. At the time, President Clinton strongly opposed the amendment, claiming that it was part of a broader attempt by Congress to "micromanage" the executive branch, and that it was a distraction from his administrations goal of reducing the size of the federal government by 272,000 jobs.
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Pros These legislative efforts put an important spotlight on the excessive number of presidential political appointees. Cons The legislation has never been enacted. Future prospects for enactment remain dim because limiting presidential appointments is viewed by many as restricting the sitting president from setting the agenda by placing loyal personnel in key offices. Proposed action by the Senate to reduce the number of presidential appointments subject to confirmation does not resolve the significant barriers facing the nominees who enter the Senate process, all of whom will continue to be subject to the rising number of personal holds that delay review.
OVERLAPPING MISSIONS Current Reality As the federal government has responded to new needs and problems over time, agencies have accumulated new roles and responsibilities that increasingly overlap with one another. Today, most agencies now address more than one mission, and most missions are assigned to multiple departments and agencies. These overlapping duties may originate from either the executive or legislative branches, as Presidents shift responsibilities and Congress realigns agency missions in order to reflect their respective priorities. Duplication and overlap reflect competing preferences for bureaucratic designwith the president favoring centralization of authority in order to drive his agenda, and Congress preferring an insulated bureaucracy that is administratively inflexible and immune to presidential meddling. Ultimately, the resulting overlap obscures the chain of command and makes it extremely difficult to hold specific agencies and personnel accountable for unsatisfactory outcomes. Major government failures represent another major cause of mission overlap. As in the cases of 9/11, the gulf oil spill, and Hurricane Katrina, government failures draw public attention and generate demand for serious policy responses. Government responses typically involve a shift in responsibilities from one agency to another, or even a complete restructuringsuch as the creation of the Department of Homeland Security in the wake of 9/11. In many cases, new responsibilities are assigned to new agencies rather than old ones not only because Presidents and legislators distrust the existing organizations, but also because they can exercise more control over newly formed bodies. Mission overlap may also result from the lack of regular review. For example, GAO has reported that tax expenditures (such as credits and deductions to encourage social & economic activities) are given less oversight than discretionary programsa reality that has led to excessive duplication. Problems with Mission Overlap A certain amount of redundancy is understandable and even necessary in order to reflect the breadth of activities associated with increasingly complex federal missions. For example, the break-up of the Society Union demanded a vast effort across numerous federal departments and agencies in order to provide the food aid, private sector development, emergency humanitarian assistance, and democratic reform that the circumstances required. In too many cases, however, the degree of overlap is excessive and gives rise to enormous coordination and accountability problems.
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One salient example is the federal governments food safety regulation system, which deploys 15 agencies to administer 30 food-related laws, and contributed to the 2008 Salmonella outbreak that led to a recall of over 500 million eggs. Taken as a whole, when missions are spread out among numerous agencies, no single entity is accountable for their effective executionmaking it difficult for leaders to determine who is responsible both before and after a failure. Mission overlap also creates opportunities for regulatory arbitrage. In the case of financial regulation in the late 1990s, identical financial products were subject to different rules, regulations, and regulatory burdens that differentially impact firms profits and competitiveness in the market. Thus, by exploiting legal loopholes, firms could effectively select their regulatorsusually the Federal Reserve, the Federal Deposit Insurance Corporation, the Securities and Exchange Commission, Treasury Department, and so forth. As a consequence, it is often unclear who regulates whom. Further examples of overlapping responsibilities between agencies include: Over 20 federal agencies provide a wide range of assistance to individuals with disabilities, such as employment-related services, medical care and monetary support. These agencies often have different missions, funding streams, eligibility criteria and policies that sometimes work against each other. In addition, these agencies utilize data management systems that often employ different definitions and cannot be easily integrated to create a comprehensive picture of disabled individuals and their needs. Multiple federal agencies have overlapping responsibilities for cyber security and it is unclear which agency has overall responsibility. This effort was supposed to fall under the National Cyber Security Center (NCSC); however, a number of other cyber security response centersincluding one within DHShave many of the same responsibilities for coordinating information and securing networks and systems. Due to lack of coordination between agencies and the White House, the center is still not fully operational, and confusion remains regarding which responsibilities it should assume. This poor coordination was further revealed during the federal governments ad-hoc response to the July 2009 cyber attacks on US government websites. As previously mentioned, federal oversight of food safety is becoming more fragmented, with 15 agencies administering 30 food-related laws. The Department of Agriculture is responsible for inspecting all meat and poultry, and catfish, while the Food and Drug Administration is responsible for nearly all other foods, including seafood. However, the Government Accountability Office reports that this fragmented system has led to insufficient oversight, poor coordination, and a wasteful use of resources. For example, the USDA, FDA and Environmental Protection Agency lack a coordinated strategy for monitoring genetically engineered crops for food safety concerns. Moreover, federal expenditures on food safety are not consistent with the volume of foods that are regulated by agencies. The FDA monitors about 80 percent of the food supply but accounts for only 24 percent of expenditures. The USDA, on the other hand, monitors only 20 percent of the food supply but accounts for the majority of expenditures. This fragmented oversight structure contributed to the 2008 outbreak of salmonella, which affected 1,500 people nationwide and led to a recall of over 500 million eggs. At the time, the FDA oversaw the safety of eggs still in their shells, while the USDA regulated liquid eggs, chickens, and the grading of eggs for quality. Meanwhile, Iowas agricultural department regulated farms use of chicken litter used for fertilizer. However, none of these authorities inspected the Iowa farms responsible for the outbreak to make sure that the eggs were safe for human consumption. The USDA had inspected the relevant egg facilities for grading purposes prior to the recall, observing unsanitary conditions, but this critical information was never communicated to the FDA. Moreover, even if the FDA had known about the presence of salmonella, it would not have had the power to demand a recall but only to encourage a company to voluntarily recall a product.
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Past Efforts to Minimize Mission Overlap Presidents have grappled with overlapping missions in the executive branch through a variety of structural mechanisms. They have expanded efforts to centralize policy planning and management in the White House, particularly through the Executive Office of the President (EOP), institutional coordinators like the National Security Council (NSC), a super cabinet, and policy czars. Commissions and task forces created by the president and/or Congress have offered reorganization advice and occasionally independent counsel. And efforts have been made to better align the executive hierarchy through the creation of large super-agencies like the Departments of Homeland Security and Health, Education, and Welfare. White House Centralization The president can coordinate the disparate parts of a congressionally created executive branchsuch as the defense and intelligence communitiesby centralizing their command through White House agencies. The Executive Office of the President (EOP) serves as a nexus between various departments and agencies in order to improve coordination and better carry out the Presidents agenda. But while the president can create new EOP functions with discretionary funds, such decisions are not allowed to contravene existing statutes remain subject to Congressional approval. The press often refers to EOP office directors and other prominent non-Cabinet staff members as czars. Some of these positions must face Senate confirmation, such as the intelligence czar who leads the Office of the Director of National Intelligence (ODNI). Other powerful positions like the National Security Advisor and head of the National Economic Council serve at the pleasure of the president and are not subject to Senate confirmation. Pros White House centralization may improve coordination of overlapping missions in government Cons White House centralization has little ability to eliminate duplicative structures unless Congress goes along either in the budget process or in new legislation White House is also dependent on Senate confirmation for the appointment of some prominent nonCabinet staff, such as the intelligence czar Influence of czar-like advisors depends on degree to which presidents coordinate policy from the White House and not through functionaries in the cabinet.
Government Performance and Results Act In 1993, Congress passed the Government Performance and Results Act (GPRA), which attempted to shift the emphasis of accountability from staffing and activity levels to the specific outcomes produced by federal agencies. The act required agencies to do three main things: (1) to develop five-year strategic plans, mission statements, and results-oriented objectives for each of its major missions; (2) to prepare annual performance plans detailing performance goals for each fiscal year, and a description of how the goals are to be met and verified; and (3) to prepare annual performance reports that assess their degree of its success in meeting their stated goals. One of the key objectives of this statute was to increase government information and improve coordination on missions that cut across agencies. Pros GPRAs information requirements improved knowledge and understanding of mission overlap across agencies; GPRA provided opportunities for agencies to ensure that strategies are reinforcing, common performance measures are used, and coordination is improved overall.
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The recently enacted Government Performance and Results Modernization Act should enhance the priority-setting process, and allow much better measurement of results.
Cons The OMB, Congress, and executive agencies did not realize the full potential of GPRA to address crosscutting missions. Congress has not made adequate use of agency performance information to identify fragmentation and overlap across mission areas. GPRA calls for the Office of Management and Budget to develop government-wide performance plans in order to better address missions that cut across different agencies, but the OMB has not issued a distinct plan since 1999.
CONFLICTING MISSIONS Current Reality As agencies accumulate new responsibilities, it is increasingly common for their missions to conflict with one another. Examples abound in the current environment: the Immigration and Naturalization Service must protect the borders but also support legal immigration; the Customs Service must facilitate trade while keeping unwanted items out of the country; and until recently, the Mineral Management Service not only enforced environmental and safety regulations, but also developed energy resources and collected mineral revenues. Such conflicts arise from a number of factors, including highly political disagreements about agency jurisdiction and the growing reliance on fees for revenue. Problems with Conflicting Missions Conflicting missions compromise an agencys accountability mechanisms because they obscure the organizations real priorities. Moreover, such conflicts often force agencies to play a zero-sum game where the fulfillment of one mission comes at the expense of another. This was the case in the lead up to the gulf oil spill when the Minerals Management Service proved unable to meet its responsibilities for conducting environmental and safety inspections because of a management focus on drilling. Other times, agencies develop split personalities that prevent them from succeeding at either mission. This has been the result at the Department of Homeland Securitys Immigration and Customs Enforcement Bureau, where both illegal immigration and citizenship application backlogs have risen despite enormous increases in the agencys budget. Conflicts are particularly problematic when agencies have financial incentives to prioritize one mission over another. This is apparent in the case of regulators whose budgets are increasingly dependent on fees, as they become increasingly susceptible to focusing on revenue generation at the expense of regulatory oversight. For example, the FDA started collecting fees from the pharmaceutical industry in 1992. The law creating the fees re-oriented the agencys priorities towards speeding up the approval process, and as a result, approval times were cut in half by1999. But the string of drug recalls over the last 10 years suggests that the agencies new priorities were misplaced. Furthermore, even when agencies do not have missions that directly compromise regulatory oversight, experts who have previously worked in the industry often lead them, and many plan to return after their tenures in government. Subsequently, these agency leaders have strong incentives to act on behalf of the industries they are supposed to regulate. Further examples of conflicting missions include: The Forest Service has always had to balance production and preservation of resources on public lands, but the emphasis between these two missions has varied widely. During and after World
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War II, timber harvesting became critical to war efforts and the post-war housing boom. Starting in the 1960s, as environmental concerns mounted, the agency reoriented. Today, it has come to emphasize ecosystem management over timber harvesting. But the shift hardly has unanimous support. The Customs Service is responsible both for speeding trade and preventing the entry of undesirable goods into the United States. But thoroughly inspecting goods coming into the country takes time and the resulting shipping delays cost importers money. Conversely, moving goods quickly undermines the ability to inspect them for contraband. Hence, those who favor law enforcement see Customs as inadequately aggressive and those who want faster movement of people and goods view the agency as a bureaucratic impediment. The mission clash has forced Customs to constantly shift resources between conflicting priorities, a recipe for management inefficiency. Prior to the financial crisis, a number of federal regulations were in place to protect consumers against fraud and to promote understanding of financial products like credit cards and mortgages. But as abusive practices spread, particularly in the market for subprime and nontraditional mortgages, the federal governments regulatory framework proved inadequate in important ways. Multiple agencies have authority over consumer protection in financial products, but for historical reasons, the supervisory framework for enforcing those regulations had significant gaps and weaknesses. Banking regulators at the state and federal levels had a potentially conflicting mission to promote safe and sound banking practices, while other agencies had a clear mission but limited tools and jurisdiction. Most critically in the run-up to the financial crisis, mortgage companies and other firms outside of the purview of bank regulation exploited that lack of clear accountability by selling mortgages and other products that were overly complicated and unsuited to borrowers financial situation. Banks and thrifts followed suit, with disastrous results for consumers and the financial system. The USDA is simultaneously responsible for improving nutrition and health through education and expanding markets for agricultural products. This tension has played out in the agencys recent promotion of the cheese industry through Dairy Management, a government-created marketing consultant for the industry that has helped firms market their products on the basis of increased cheese content. In one example, Dairy Management spent millions of dollars on an advertising campaign that claimed people could lose weight by consuming more dairy products, even though no other research has substantiated these claims. Such efforts run in the face of federal anti-obesity efforts that discourage over-consumption of some of the very foods that Dairy Management actively promotes. Prior to the BP Gulf disaster, The Minerals Management Service had two missions that conflicted with its regulatory responsibilities: to manage mineral resources on the Outer Continental Shelf (OCS) and to collect and distribute bonuses, rents, and royalties from companies that lease and produce minerals from Federal lands, both onshore and offshore. In both of these missions, the agency largely saw itself as a partner of industry, and failed to monitor oil and gas companies with appropriate scrutiny. For instance, MMS gave a safety award to Transocean, the owners of the Deepwater Horizon rig. Moreover, the Washington Post found that the company from which MMS claimed to have received its largest fine between 2000 and 2009 could find no evidence that the fine had been levied. MMSs mistakes and insufficient oversight resulted in billions of dollars in uncollected royalties, and contributed to the Deepwater Horizon disaster that has devastated the Gulf.
Past Efforts to Address Conflicting Missions MMS Restructuring On May 19, 2010, Department of Interior Secretary Ken Salazar issued a secretarial order to divide the departments Minerals Management Service (MMS) into three separate offices: (1) the Bureau of Ocean
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Energy Management (BOEMRE) for developing both renewable and oil and gas resources; (2) the Bureau of Safety and Environmental Enforcement (BSEE) for regulating these industries; and (3) the Office of Natural Resources Revenue (ONRR) for the collection of onshore and offshore revenues. On July 15, Secretary Salazar received an implementation plan for this restructuring, which calls for a phased implementation beginning in January 2011 and continuing for about 12 months. The plan notes that restructuring is not the only tool for overhauling offshore energy management, but is a key component of a larger strategy that includes new safety requirements, investigation of the BP Deepwater Horizon oil spill, legislative and regulatory reform, and new inspection programs. Pros Splitting MMS into three bureaus is a necessary reform for addressing the agencys previous conflicts of interest. Reforms have been bolstered by stronger ethics guidelines and efforts to slow the revolving door between industry and government.
Cons Spitting missions would create new agencies that would be more difficult to audit and inspection functions, making it difficult to attract high-quality leaders. Reorganization cannot solve the entire problem because poor oversight is largely the result of a subservient relationship between MMS and industry. BSEE will still face conflicts of a regulatory body that is closely tied to the industry that it regulates.
PRACTICAL RECOMMENDATIONS FOR REFORM 1. Eliminate 1,500 Senate-confirmed presidential appointees and presidential at-will appointees in the non Career Executive Service and the Schedule C classification category. The majority of political appointees are not confirmed until well after the Presidents first year in office. Accountability is diffused without leaders at the helms of agencies and departments, putting our nation at greater risk for a crisis. Estimated Savings: $1 billion 2. Reduce the number of management layers in the federal hierarchy by half, while setting a goal of no more than six layers between the president of the United States and the service delivery layer of the hierarchy. The executive hierarchy has grown taller in the past 50 years without sufficient evidence that new positions are indeed needed. The President has never had more leaders to supervise. Estimated Savings: Positive, but not yet scorable 3. Rebalance the federal workforce to eliminate senior level positions that are less essential to an accountable, efficient and productive government. Much of the downsizing of the federal service in the past 20 years was based on attrition, which has a pernicious impact on the frontlines of government where turnover rates are highest. The federal workforce is not so much in need for downsizing, but reshaping. a. Reduce the number of higher-cost GS 13 to 15 managers and professionals using a one-for-two ratio replacement ratio after they separate or retire. This ratio would be implemented after evaluating each vacancy before it is filled or eliminated. b. Strengthen the service delivery levels of government by increasing the number of employees using a two-for-one replacement ration after they separate or retire.
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c. Create a pay-go system for the creation of new presidential positions and management levels. The PAYGO system would prohibit the creation of any new appointed positions and layers without a one-in-one-out policy. Estimated Savings: Positive, but not yet scorable 4. Require Congress to prepare and review administrative impact statements for all pending legislation. Estimated Savings: Positive, but not yet scorable 5. Make sure the Congressional Budget Office has the staff and expertise to score management reform with the same dedication used to score policy proposals. Estimated Savings: Positive, but not yet scorable
THE EFFICIENCY CHALLENGE Inefficiency can be the silent killer of effective government. Wasted tax dollars can at times go unnoticed in a $3.5 trillion budget, but every dollar wasted is one that could have been spent better delivering more services or bolstering the governments capacity for better delivery in the future. More perniciously, citizens perception of inefficiency fosters mistrust in governments willingness to do its job well, particularly at a time when the private and nonprofit sectors continue to seek excellence in efficiency and innovation. Insofar as inefficiency goes unaddressed, it reduces the federal governments ability to fully and effectively honor its obligations to the people. The result is a frustrated, ill-equipped federal workforce and a weakened consent of the governed. At its worst, inefficiency results in very public failures that directly and negatively impact peoples lives. Hurricane Katrina is a telling example. During the FEMA response to Hurricane Katrina, state and local emergency responders shared a common IT system to manage requests for assistance and material aid. At the federal level, however, FEMAs logistics systems were incompatible with the state and local software, and FEMA personnel were not trained to understand their counterparts system. As a result, first responders at times found making and tracking requests for federal aid a hopeless affair. FEMA also had only one outstanding contract for temporary housing in the region prior to Katrinas landfall, resulting in a shortage of trailers and necessitating a flurry of noncompetitive contracting to fill demand for services that should have been anticipated during emergency planning. Examples like Katrina show that the technicality even banality of inefficiency does not inhibit it from occasionally impacting core governmental functions to a degree justifiably labeled catastrophic. INSUFFICIENT PROGRAM MEASUREMENT Current Reality Between 1944 and 2000, Congress passed approximately 553 major laws spanning dozens of missions: expanding homeownership, ensuring safe drinking water, improving mass transportation, and others. Unlike the private sector, the federal government is often tasked with fulfilling missions where evaluating program outcomes can be difficult. Measuring the number of flights booked or cars built is much easier than measuring the degree to which hunger has been reduced, consumers have been protected, and public safety has been secured. Nevertheless, a government looking to execute the laws faithfully must have methods for measuring its success in doing so, as well as plans for improving performance and costeffectiveness over time. Despite progress toward more efficiency standards for agency management (such
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as the Government Performance and Results Act), the federal government lags behind the private and nonprofit sectors in its measurement of program outcomes. Agency appropriation requests are an ideal time for the executive branch to audit the performance of federal agencies around mission. The OMB can use its own analysesas well as oversight reports from the GAOto make the case for programmatic realignment and funding changes based upon recent performance. Congress may still override these executive recommendations in appropriations committees, but this can be harder to justify when presented with a rigorous analysis detailing why a program is failing to fulfill its mission. And yet, even with some program evaluation systems in place, ineffective and duplicative programs continue to live on, sapping scarce resources away from high-performing alternatives and solidifying their presence in the federal structure. Overlapping missions play a major role in inefficiency. Not surprisingly, this results in the blossoming of duplicative program streams across the executive hierarchy. A 2000 report by the GAO found 40 jobs training programs across seven agencies in the federal government, with combined funding of approximately $11.7 billion. Fourteen of the programs served fewer than 4,000 people, with one program serving only 318. It is unclear why programs with such limited scope need to be managed and/or funded at the federal level, or why they shouldnt be consolidated. A similar GAO report in 1995 found that jobs training programs had administrative costs between 7-20 percent, suggesting consolidation or elimination of duplicated efforts could yield over a billion dollars in overhead savings alone. Similar examples of program duplication include 110 federal programs for science, technology, engineering and mathematics (STEM) education and over 100 youth mentoring programs. It may be rational to have similar programs across various agencies, but the presence of dozens of duplicated efforts cries out for an evaluation protocol (or agency/office) that more persuasively makes the case for consolidation and elimination of programs in the already information-saturated budget process. Even if substantial reporting and evaluation processes are implemented for all federal programs, the information generated is not always useful, or presented in way that facilitates actionable policy response. As Senator Mark Warner remarked about examining USDA performance evaluations from 2008, You can see a fairly weighty tome, based upon their GPRA efforts, clearly a lot of information. I sometimes think that we could do with a little less reporting and a little more focus on more valuable data. So far, the federal government has been unable to create an evaluation and measurement system that has the unique combination of Congressional influence and comprehensiveness (and comprehensibility) that would allow program analyses to be readily translatable into programmatic or budgetary changes.
Past Efforts to Measure Performance Congress, presidents, and OMB heads have tried various ways to align agency resources around their mission, and have sought to measure programmatic effectiveness in a consistent way. They have also created oversight structures like offices of inspectors general (OIGs) that help identify wasted or inefficiently directed resources, along with fraud and abuse. Agency Performance Plans The Government Performance and Results Act of 1993 mandated annual agency performance plans as a mandatory exercise in defining strategy around agency mission, establishing measurable outcomes, and rationalizing budgetary resources. The plans are reviewed by the OMB during budget preparation and are also regularly analyzed by the GAO. In addition to generating programmatic measurement tools, the performance plans also give the federal government insight into duplicative policy efforts across government. However, as the GAO noted in a review of FY 2000 performance plans, identifying and coordinating/consolidating crosscutters would be easier if agencies themselves recognized their existence in the plans, and the OMB assisted them in this effort.
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Pros Provides standardization of agency strategizing and program measurement. Forces rationalization of budgetary resources around mission.
Cons Performance plan usefulness depends on agency leaders to be honest and reflective. Locating crosscutting programs may fall to the staff at OMB. Legislators may resurrect crosscutters in competing appropriations committees.
Presidents Management Agenda (PMA) and Program Assessment Rating Tool (PART) The Presidents Management Agenda (PMA) was established in 2001 as a measurement initiative to boost government efficiency. According to the GAO, OMBs PMA standards included references to additional approaches to improving efficiency, such as competitive sourcing and business process reengineering for commercial services management, developing business cases for major systems investments, and using earned value management to plan, execute, and manage major information technology (IT) investments. PART was created as a component of PMA in 2002. Specifically, it promoted efficiency measurement by forcing agencies to identify cost drivers used to produce programmatic services, and then tracked ratios over time (i.e. inputs per unit of output/outcome). Government efficiency could therefore be boosted either by reducing costs or increasing the amount of output that a given unit of cost could produce. Pros Standardization of measures allows for effectiveness tracking over time. Emphasis on measurement drives IT system investments.
Cons Successful implementation necessitates developed cost accounting systems across agencies. GAO found that many measures were output- or process-based rather than outcome-based. Appropriations are fungible and some outputs time-variant, so attempting to identify outputs in a given period with inputs from a given period may be misleading. What gets measured gets done. Picking what is easily measured may not be consistent with an agencys most important mission(s).
Mobilization of the Federal Inspectors General (IGs) The first Office of Inspector General (OIG) was created in 1976, followed by further expansion in 1978 and thereafter. Prior to the 1978 act, agency leaders were capable of impeding audit efforts of administratively appointed Inspectors Generalfor example, the Secretary of Agriculture abolished the departments entire OIG in 1974. Under the 1976 and 1978 acts, the president was given authority to appoint the inspectors general with the consent of the Senate without regard to political affiliation and solely on the basis of integrity and demonstrated ability in accounting, financial analysis, law, management analysis, public administration, or investigations. Under the 1978 act, agency heads and their superiors may not interfere with audits, investigations, or subpoenas initiated by IGs, insulating auditors to some degree from internal and external political pressures. The 1978 act also promotes independence by establishing a dual reporting responsibility, whereby IGs report both to the head of their respective agencies and to Congress.
22 The Campaign for High Performance Government Robert F. Wagner School of Government New York University
Congress passed the Inspector General Reform Act in 2008, which consolidated 69 inspector general offices along with leaders from the OMB, OPM, FBI, Office of the Special Counsel, and Office of Government Ethicsinto a centralized Council of the Inspectors General on Integrity and Efficiency (CIGIE). Ostensibly, the 2008 act will allow for greater coordination between independent OIGs and allow for the continual development of rigorous IG standards and practices. For the purposes of program evaluation of measurement, the CIGIEs first goal upon assembly was to contribute to improvements to program integrity, efficiency, and cost-effectiveness across government by providing cross-agency analyses to mitigate vulnerabilities that confront multiple federal programs and entities. In its first year of operation, the CIGIE acted on this goal by beginning investigations into expenditures across agencies from the 2009 Recovery Act, whistleblower hotlines across agencies, and crosscutting national disaster response functions. Also in fiscal year 2009, agency leaders agreed to more than $34 billion in spending changes that IGs posited would result in better uses of funds or lower costs. Pros (of CIGIE) Centralizes the mission and coordination of dozens of independent IGs throughout the government. Brings together agency-specific experts to investigate interagency vulnerabilities. CIGIE explicitly states that cross-agency evaluations are a major priority. IGs possess politically insulated subpoena power for their investigations, unlike the GAO.
Cons It is still unclear how CIGIE and GAO might best coordinate their actions to maximize oversight and minimize unnecessary overlap of investigations. Former Comptroller General David Walker said in 2003, Traditionally, GAO and IG coordination has been applied on an ad-hoc, job-by-job or issue-by-issue basis. The 2008 reform act requires presidential budgets to delineate how much money is requested by each IG office, as well as the funding level requested by each IG. Like any other governmental function, IG effectiveness may be limited by insufficient resources, which are requested and allocated within the (still political) budget process.
WASTEFUL CONTRACTING AND PROCUREMENT Current Reality Government agencies are increasingly contracting out to the private and nonprofit sectors those basic services that have traditionally been the province of federal employees. Agencies frequently rely on a single bid (or no bids at all) to award large federal contracts, or use contract types that place cost overrun risks and auditing burdens on the government, rather than contractors themselves. The number of acquisition/procurement officers has not kept pace with the scale of contracting, which shows in the governments inability to enhance efficiency and cost-savings through competitive bidding, bundled contracting, and interagency procurement strategies. Putting aside the accountability issues that arise when nongovernment personnel provide essential public services, federal contracting policies should strive to achieve the best possible prices from contractors operating in a competitive environment. All too often, federal agencies fail to take advantage of a competitive commercial marketplace or achieve the lowest prices available for goods and services.
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Failure to Leverage Purchasing Power Congress has passed multiple pieces of legislation over the past eighty years intending to streamline federal agency procurement and contracting. The General Services Administration (GSA), for example, was granted authority to negotiate large indefinite-delivery/indefinite-quantity (ID/IQ) contracts with outside vendors in an effort to receive most favored customer pricing for federal agencies. In 2008, federal agencies used GSA pricing schedules to acquire $37.6 billion of commercial goods. Similarly, multiagency contracts (MACs) exist to promote contracting efficiency by enabling agencies to contract with other agencies that already have outstanding vendor contracts, rather than entering into new vendor agreements (MACs or enterprise-wide contracts) and fragmenting the governments buying power. With regard to GSA procurement, the GAO and GSAs Inspector General have found that the tools GSA uses to ensure favorable pricing are inconsistently applied, possibly resulting in costs that may otherwise be avoided. For example, audits of a vendors customer pricing are supposed to be conducted prior to awarding contracts expected to exceed $25 million over five years. GSAs Inspector General found that for the two year period of 2009 through 2011, more than 250 contracts that exceeded the $25 million threshold were not selected for audit due to resource constraints. Inspector general audit data also show a strong correlation between the number of audits conducted and GSA cost savings achieved, suggesting these auditing resource constraints may cause significant savings to go unrealized. GSA data systems also fail to track many, if not most, agency transactions that occur through its vendor schedules. As a result, it is difficult for GSA and government accountability analysts to know the extent to which agencies are capturing favorable pricing or missing out on optimum procurement terms. Inter- and intra-agency contracting face their own inefficiencies. In particular, the federal governments procurement database does not reliably track the proliferation of MACs and enterprise-wide contracts. In other words, a complete picture of which agencies are contracting for themselves or with othersrather than through the GSAis generally unavailable, creating great difficulty for third parties to locate areas for contracting improvement or consolidation. (One study estimates 2004 interagency contracts at $142 billion, or 40 percent of that fiscal years contracting.) Despite the existence of GSA schedules and multitudes of MACs, many agencies find creating new MACs and enterprise-wide contracts a better option than using existing contracts. The reasons given to the GAO for this practice included avoiding fees paid for the use of other agencies contracts, gaining more control over procurements made by organizational components, and allowing for the use of cost reimbursement contracts. Another analysis reached similar conclusions, stating the pressures and incentives to create and use these vehicles, coupled with inconsistent or lacking oversight and little transparency has created an environment biased towards the uncoordinated proliferation of interagency contracts. Taken together, a lack of centralized information (such as a reliable database) or management (such as required authorization from OMB or another entity before entering into new contracts) regarding federal contracts may be costing taxpayers billions of dollars per year. Agencies frequently lack the funding or information resources to fully research new vendor contracts or search the federal government for relevant, existing vendor relationships. Failure to Contract Competitively As the number of federal contract employees has grown from an estimated 4.4 million in 1999 to 7.6 million in 2008, so has the incidence of reports detailing waste and uncompetitive practices. By one estimate, the number of contracts not subject to full and open competition grew from $82 billion to $188 billion between 2002 and 2008. In a memo to the heads of the federal agencies, President Barack Obama emphasized figures that showed the amount of cost-reimbursement contracts rising grew from $71 billion in 2000 to $135 billion in 2008. Sometimes the stories are more specific: it was recently reported that the Postal Service has awarded more than 2,700 contracts to former employees since 1991 and awarded 17 no-bid deals to former executives between 2006 and 2009, with some contracted executives
receiving twice their original federal salaries. It makes sense to ask how contracting and procurement controls are breaking down in cases like these. In many such cases, breakdowns occur during the standard procurement process detailed earlier in this section. For example, agencies may open a kind of account for recurring orders with GSA schedule vendors through a blanket purchase agreement (BPA, which is not an explicit contract, so there are no minimum order or delivery requirements). In a GAO study of BPA assignments, a sample of agencies showed only 64 percent considered more than one vendor before awarding a BPA. Agencies may also award BPAs to multiple vendors, but the GAO sample found that 60 percent of BPAs were awarded to only a single vendor, sometimes for many years or even decades. The GAO report notes that Federal Acquisition Regulation (FAR) is ambiguous about competition requirements in the case of BPAs, illustrating that a lack of mandatory requirements or consistent oversight will typically yield practices favoring simpler, uncompetitive procurement. Cost-reimbursement and time-and-materials (T&M) contracts, rather than the preferred fixed-price alternative, have increased significantly. The latter type outline a fixed price for services rendered, so that project overruns are essentially borne by contractors, not the government. Cost-reimbursement and T&M contracts, on the other hand, reimburse contractors for their overall costs (plus a fee) or their supplies and hourly labor costs. These contract types are more high risk for the government since costs will be borne by taxpayers, and contractors have fewer incentives to be cost-efficient as a result. The Acquisitions Advisory Panel in 2007 found that fixed-price contracts, which are generally accepted as the optimal contracting vehicle are often passed over for cost-reimbursement and T&M contracts because the government frequently is unable to define its requirements sufficiently to allow for fixed-price solutions, and also because of a culture focused on getting to award and budgetary time pressures combined with a strained workforce and lack of internal expertise in the market. The Department of Defense (DOD) is one example. According to the GAO, the amount T&M contracts in DOD doubled from $5 billion in 1996 to $10 billion in 2005, but noted that these amounts are likely understated because they do not include contracts submitted through the GSA schedule. Data show that T&M contracts ramped up around the start of the second Gulf War, and were likely used to get flexible contracts in place quickly. However, the GAO noted, for most of the contractsreviewed, the justifications did not include a rationale showing why no other contract type was suitable, nor did the acquisition plans. Failure to Train and Equip the Federal Acquisitions Workforce Federal procurement professionals also cause tremendous inefficiency. The Acquisitions Advisory Panel found that since 1999 the size of the acquisition workforce has remained relatively stable, while the volume and complexity of federal contracting has mushroomed. In testimony before the Panel, former Department of Homeland Security Chief Procurement Officer Greg Rothwell described the acquisitions workforce as having been gutted, and gave an example of a $3 billion program that did not have a single full-time equivalent [procurement] employee. Contracting cannot be conducted efficiently if procurement offices lack the staff, training, and funding to perform their jobs well in an environment of evergrowing complexity. Past Contracting Reform Efforts Both presidents and Congress have attempted to take hold of the government contracting process by creating commissions, writing contracting guidelines into appropriations bills (e.g., the 2009 economic stimulus bill required fixed-price contracts to the maximum extent possible), and promulgating procurement standards through the Office of Management and Budget.
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Contracting Guidelines and Oversight In March 2009, shortly after taking office, President Barack Obama issued a memorandum to the head of all executive agencies and departments calling for a more deliberately competitive and justified contracting framework. In July of that year, OMB head Peter Orszag issued a follow-up memorandum calling on all agencies to reduce the number of FY 2010 sole-source, cost-reimbursement, and T&M contracts by 10 percent from FY 2008 levels. Orszag also recommended development of acquisitions staff skills and better use of technology in the procurement process. A few months later, the Office of Federal Procurement Policy (OFPP) within OMB issued a new contracting framework for use by agency heads in moving away from these types of contracts, asking acquisition leaders to discuss their policies and procedures already in place and to show proof of movement toward competitive awards. The OFPP will conduct semiannual reviews of progress and require correct actions plans, where necessary. Pros Clearly outlines expectations for reduction in high-risk contracts over a defined period of time. Symbolizes executive awareness and action regarding recurrent contracting failures. Recognizes the need for acquisition workforce training and stronger recruitment.
Cons Little or no response to the presidents request for clarification on when governmental outsourcing for services is and is not appropriate. OMB contracting guidelines often conflict with guidance from other sources. For example, the OMB memo recommended pooling the federal government's buying power in pursuit of strategic sourcing. The president's small business task force, on the other hand, urged strategies to prevent unjustified contract bundling, or aggregating in one contract supplies or services "previously provided or performed under separate smaller contracts."
Business Case Analyses for New Interagency Contracts The defense appropriations bill for fiscal year 2009 requires that all new multiagency contracts be justified by a business case analysis. The analysis must include estimates of direct and indirect costs to the federal government of awarding and administering a contract and the impact it would have on the ability of the federal government to leverage its buying power. The Act also compels more communication between agencies using existing MACs, specifying that all interagency acquisitions include a written agreement between the requesting agency and the servicing agency that assigns responsibility for the administration and management of the contract and a determination that the acquisition is the best procurement alternative. Pros A meaningful legislative attempt to restrain the redundant proliferation of new contracts. Mandates more communication and rationalization between agencies about procurement alternatives.
Cons The GAO remarks, the act is silent on what steps an agency should take to examine the effect a new contract will have on the ability of the government to leverage its buying power. Additionally, the act does not address similar requirements for enterprise-wide contracts. That is, implementation is unspecified, and not applicable to new contracts limited to one agency.
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Encouraging Performance-Based Acquisition (PBA) Strategies In its memo on increasing competition during the procurement process, the Office of Federal Procurement Policy argued Performance-based acquisition (PBA) is the governments preferred approach for acquiring services. PBA is an approach to obtaining innovative solutions by focusing on mission outcomes rather than dictating the manner in which the contractors work is to be done. Those outcomes are then measured and the contractor compensated on the basis of whether or not the outcomes are achieved. PBA is also used extensively in the private sector, and leaves substantial room for contractor innovation and maneuverability in finding the best way to meet well-defined goals by (1) establishing an integrated solutions team; (2) describing the problem that needs to be solved; (3) examining private sector and public sector solutions; (4) developing a performance work statement (PWS) or state of objectives (SOO); (5) deciding how to measure and manage performance; (6) selecting the right contractor; and (7) managing performance. Pros (quoted from Acquisition Advisory Panel) Increased likelihood of meeting mission needs. Focus on intended results, not process. Better value and enhanced performance. Less performance risk. No detailed specification or process description needed. Contractor flexibility in proposing solution. Better competition: not just contractors, but solutions. Contractor buy-in and shared interests. Shared incentives permit innovation and cost effectiveness. Surveillance: less frequent, more meaningful. Variety of solutions from which to choose.
Cons Implementation requires a well-trained acquisition staff with highly clarified missions. Metrics can be difficult to create and track. Not always an appropriate option: requires significant upfront investment of time and ongoing monitoring.
BARRIERS TO INNOVATION AND TECHNOLOGY INTEGRATION Current Reality Only 41 percent of federal employees agreed that creativity and innovation are rewarded. Thirty percent responded negatively to the statement. It is clear that management of the federal bureaucracy continues to be a resolutely top-down process. From a strategic perspective, such centralization of management authority ensures execution of a democratically elected presidents agenda. From an operational perspective, however, top-down management prevents the knowledge of line managers and employees from being utilized to improve and streamline services, particularly those dealing most directly with the public. At the same time, the government has severely lagged behind the private and nonprofit sectors in using technology to drive productivity and connectivity. Technology investments like some government
contracting generally are often initiated with little regard for leveraged purchasing opportunities and interoperability between agencies and programs. The Obama administration, though, has taken significant steps to begin addressing the public-private IT gap. The public sector generally does not have the same culture of innovation that the private sector has, despite a workforce of people with good ideas. As the Center for American Progress has noted, innovation is harder for government because of the way money is allocated (as discussed above, money does not always flow to the most effective programs), because of voter preferences for policies they already understand, and because of a federal culture that compensates and rewards people for turning the gears of bureaucracy rather than improving the overall machinery. This does not mean that government is incapable of new processes and ideas, just that the institutional framework and culture does not possess the raison dtre of innovation that the private sector must have in order to thrive. The absence of a more innovative and efficiency-minded culture manifests itself in wasteful processing errors and underdevelopment of technological capability. As OMBs Deputy Director for Management, Jeffrey Zients, recently lamented, In 2009, the Federal Government reported improper payments of $100 billion. These are payments to the wrong person or the wrong entity or in the wrong amount. $100 billion of waste is not just a waste of money; it also erodes citizen trust. Its unacceptable. Or consider the case of U.S. Census Bureau, which invested in a $647 million program for handheld computers that it eventually abandoned in favor of paper response forms. Such poor planning and execution of new technologies is not consistent with a government aiming to embrace innovative practices. On the information technology frontwhere the government spends more than $75 billion per yearthe federal purchasing process fails to match best practices of other sectors in the economy. According to Peter Orszag, In the private sector, IBM has reduced the number of data centers it uses from 235 to 12. HewlettPackard has consolidated 14 data centers into one, reducing energy consumption by 40 percent. What about the federal government? Since 1998, we have gone from 432 data centers to more than 1,100. Where the private and nonprofit sectors have been scaling down their redundant network infrastructure (and moving toward cloud computing), the government has been building more, compounding its utility costs and creating more capacity to sit idle much of the time. The investment process is also not being well managed. In 2008, the OMB and agencies found 352 IT projects that were at risk for waste, with $20.4 billion of investments labeled as poorly planned, $1.8 billion as poorly performing, and $3 billion as both poorly planned and poorly performing. For the federal government to successfully meet novel and challenging missions (and compete for talented employees), it will need to cultivate an environment and management system that promotes creative thinking, ushers good ideas from abstraction to practice, and maximizes technological capabilities wherever possible. Past Attempts at Innovation and Technology Integration Creating a culture of innovation and technology savvy rarely happens with top-down management. The federal government and outside groups (like the Partnership for Public Service) have begun to foster innovation build-up from the employee level through awards and prizes. At the same, policies have been enacted that attempt to join this bottom-up innovation with centralized management and provision of technology services, which increases IT investment flexibility, leverages purchasing power, and enhances interoperability between agencies systems. Securing Americans Value and Efficiency (SAVE) Award The SAVE Award was established by President Obama in 2009 to empower all federal government employees to suggest changes to their agencys operations that would reduce costs, simplify or speed up governmental processes, and be easily implementable. Over 38,000 ideas were reportedly received in the first three weeks of the program, and the winner saw her proposal enacted and had the opportunity to meet the president.
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Pros Gives federal employees the chance to suggest efficiency changes to their work environments, and the recognition for doing so. Communicates ideas straight to the OMB, bypassing bureaucratic layers that would otherwise block information flows.
Cons Dependent on a discerning OMB staff to find the best ideas. Raising good ideas is no guarantee of their implementation: only 15 of the 38,000+ SAVE submissions were incorporated into the presidents budget.
Service to America Medals (Sammies) The Samuel J. Heyman Service to America Medal is awarded annually to those public servants who demonstrate high impact and innovation. Sponsored by the Partnership for Public Service and a number of corporate entities, the medal is awarded in eight categories, some of which deal with unique achievement or career service, while others are specific to federal roles, such as Justice and Law Enforcement. Pros Recognition of federal employee achievement, with emphasis on innovation and high performance. Cons Because the program is sponsored by the nonprofit Partnership for Public Service, not the federal government itself, the awards may limit the awards ability to actually shape the culture of the federal service or promote innovation sharing between agencies. OMB Centralization of Information Technology (IT) Contracting The Information Technology Management Reform Act of 1996 (often combined with the Federal Acquisition Reform Act of 1996 to be called the Clinger-Cohen Act) moved the responsibility for the productivity, efficiency, and effectiveness of executive IT programs to the OMB. Essentially, this management responsibility involves designating executive agents of the government authorized to enter into governmentwide acquisition contracts (GWACs) with IT vendors that can used by all other agencies. The act also requires OMB to analyze, track, and evaluate IT investments made by all agencies, which are themselves required to better link their IT planning and investment decisions to program missions and goalsto implement and enforce IT management policies, procedures, standards, and guidelines[and to] engage in capital planning and performance and results-based management. For the sake of transparency and clear project tracking, the Obama Administration took the additional step of creating the IT Dashboard in 2009. The Dashboard, which varies information accessibility to the public and agency employees, allows individuals to see the progress, cost, and management ratings of information technology investments made by the primary federal agencies and departments. To take one example, the Veterans Administration used the Dashboard to identify 45 IT projects that were at-risk and eventually terminated 12 of them. Pros Provides for integrated IT investment across the federal government. Transparency promotes close hewing to timelines, costs, and risk management. Clinger-Cohen Act forces alignment of IT capabilities with agency mission. Centralization of IT oversight with OMB clarifies accountability and, unlike most interagency contracts, allows for simplified project tracking.
Cons
Technology needs of agencies are best understood by agency leaders and line employees.
Cloud Computing and Apps.gov Cloud computing is one possible answer not only for reducing the federal governments energy bill, but also for improving IT investment flexibility and interoperability. Cloud computing combines network infrastructure power to provide users with on-demand software services. Instead of each federal agency or department procuring its own IT systems and software and having to maintain its own staff and server capacity cloud computing uses centralized network capacity to deliver software capabilities to individual departments or workers when they need it. This saves not only electricity (since hundreds of mostly-idle server farms can be condensed and operated closer to capacity), but also helps eliminate the sunk costs of large IT investment and centralizes software procurement, which can improve purchasing power. The federal government has already set off down the path toward increased cloud computing use. The website www.apps.gov was launched in September 2009 to bring cloud computing to federal agencies via the GSA. The website offers software applications (some of which are free) in the categories of business, productivity, and social media, along with cloud IT services. Within the business apps category alone, there are over thirty categories of software packages, ranging from asset management and educational software to analytics and enterprise resource planning (ERP) packages. The site also provides information and links to vendors who are interested in contracting with the GSA and appearing on apps.gov. Pros On-demand software with various subscription periods gives the agencies flexibility in investing in and/or upgrading their IT capacity. Requires significantly less physical infrastructure and electricity than the current, redundant capacity model. Removes redundant approvals, certifications, price negotiations, service level agreement negotiations, and so on that federal IT projects typically require. Allows for a gradual implementation of new technology without mandates that [punish] an agency for working at its own pace and rationalizing its adoption as it goes.
Cons Reduced physical IT infrastructure may decrease cyber security robustness (less redundant capacity available). PRACTICAL RECOMMENDATIONS FOR REFORM 1. Seek at least $1 trillion in savings over the next ten years through an aggressive attack on wasteful government spending: a. Eliminate at least half of the $150 billion in federal improper payments within five years, and all improper papers thereafter. In 2010 alone, improper and mistaken payments to individuals and companies cost the federal government $150 billion. Eliminating half of the annual rates of improper payments over the next ten years would yield $750 billion in savings. b. Dispose of the federal governments unnecessary real property. The government currently owns 1.2 million properties, 14,000 of which are underutilized or vacant. The federal government should swiftly dispose of all excess real property assets.
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c. Eliminate the $300 billion backlog of delinquent tax through aggressive collection efforts, and prevent further delinquency through effective enforcement. In 2001, the Government Accountability Office estimated the 2001 federal tax gap to be $290-$345 billion, but has steadily climbed closer to $400. Effort to eliminate delinquent taxes could produces $600 billion in savings over the next ten years ($150 for the first year, $50 for each year after. d. Consolidate and thereby sharply reduce, the number of separate data centers, while developing effective standards for sharing data across agencies and with the public. Government data should not be owned by one department, agency, etc, it should be treated as a national asset. New standards should be developed for sharing data. e. Streamline the federal acquisitions process, while enhancing competition and planning. According to OMB, the dollars spent on contracting more than doubled from 2000 to 2008, the size of the workforce responsible for managing Federal contracts remained flat. f. Terminate failed weapons systems, information technology projects and new programs at the earliest sign of failure. Doing so will greatly reduce the amount of sunk costs in unworkable programs. g. Reduce the contract workforce (now estimated at 7.5 million jobs) by 500,000 positions. Estimated Savings: $1 trillion 2. Identify all duplication and overlap across federal programs followed by immediate consolidation. With over 40 programs dedicated to jobs training and over one hundred programs devoted to science education, for example, it is clear that consolidation of federal programs will not only decrease the annual budget, but will also help to clarify department and agency missions and roles. Estimated Savings: Positive, but not yet scorable 3. Improve and encourage innovation in the federal government. When only 41 percent of the federal workforce believes that innovation and creativity are rewarded in the workplace, it is safe to assume that the federal government lags far behind the private sector in finding innovative solutions to outmoded systems. We propose that the federal government: a. Establish innovation investment funds within all federal agencies for improved government effectiveness. b. Expand the Obama Administrations SAVE award to include a one billion dollar-plus savings award with a $100,000 prize to individual or team that presents it. c. Invest in programs for preventing long-term costs by early interventions in areas such as juvenile diabetes, early childhood education, literacy, health research, and technology development. Estimated Savings: Positive, but not yet scorable
4. Strengthen oversight of government performance by increasing the number of acquisition, information technology, inspector general, and Government Accountability Office employees. Federal agencies and Congress should work together to ensure that the OIGs have sufficient funding, staffing, and resources to expose wasteful spending. Estimated Savings: Positive, but not yet scorable
5. Use the Government Performance and Results Modernization Act not only to establish priorities to measure success and eliminate non-essential programs, but also to target mission overlap and divide agencies and bureaus with conflicting missions. Conflicts often occur when agencies have financial incentives to prioritize one mission over another, usually regulator in nature.
THE PRODUCTIVITY CHALLENGE The combination of poor leadership, scarce or misaligned resources, and a lack of performance incentives at the federal level have led to an inconsistently productive and underperforming federal workforce. Lack of faith in the federal workforce further highlights the publics deep mistrust of the federal government. A highly productive federal workforce is critical to the mission of the federal government. A government is equipped to prevent crises, respond to disasters and answer the needs of citizens when its agencies and departments have a strong leaders, well-trained employees, and sufficient resources. And yet, public perception of the federal workforce is alarmingly negative despite increasing demands on government. Over half of Americans believe that federal workers are overpaid, and half think that they do not work as hard as private company employees, according to a recent Washington Post poll. More than a third of those polled think the federal workforce is less qualified than employees in the private sector, and threequarters believe that federal workers receive better pay and benefits than those outside of government. While the validity of these perceptions varies, the perceptions themselves matter greatly and correlate directly to a growing distrust toward government. These perceptions also impact morale within the federal workforce and the ability to recruit new talent. Productivity in the federal government can be examined closely at the individual and unit level, in essence where high performance is or is not exhibited. Unqualified leadership, a lack of performance incentives and disciplinary action, and insufficient resources and training are all barriers to productivity at the federal level. LACK OF CONSISTENT HIGH QUALITY LEADERSHIP Current Reality Quality of leadership within the federal government is inconsistent across agencies. In some cases, leaders of agencies focus too closely on policy and not on management or vice versa. In the worse cases, leaders are unqualified and serve solely a political purpose. There are numerous instances where one unqualified leader at the helm is seen as responsible for government failure. When effective, a strong leader is a significant driver of productivity within an agency, he or she has the potential to both encourage and enforce performance, lead by example, and advocate for the needs of the agency and its employees. A leaders strength in these areas is integral to an employees morale, sense of purpose, and overall productivity. The 2010 Federal Employee Viewpoint Survey conducted by the Office of Personnel Management highlights the profound weaknesses in federal workforce leadership. Only 44 percent of employees believe that the leaders of their organizations generate high levels of motivation and commitment in the workforce. Similarly, just 45 percent said that they were satisfied with the policies and practices of their senior leaders. This clear lack of confidence in leadership can have a severe effect on staff morale and motivation. Substandard executive level pay is one of several factors that hinder recruitment of qualified leaders to the federal workforce. While there are levels of government where employees are arguably sufficiently paid or even overpaid, it is widely accepted that senior leadership within the federal government receive significantly lower compensation than their private sector peers. Ed OKeefe of The Washington Post,
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reporting on recent data released by the Bureau of Labor Statistics writes, the government's numbers show that higher-paid, more senior employees tend to fall behind their counterparts at private companies, whereas lower-paid employees in government come out ahead. Insufficient compensation, a lack of flexibility in managing employees, challenges in navigating a daunting bureaucracy, and other factors are all significant barriers to recruiting excellent leaders. Federal Government Executive Leadership Understanding the executive structures within the federal government and how leadership is defined is an important part of identifying systemic challenges. Once past the political ranks at the very top of the federal hierarchy, members of the Senior Executive Service (SES) comprise the most significant number of executive leaders within the federal workforce. Members of the SES are selected and evaluated based on their possession of fundamental competencies and Executive Core Qualifications. Fundamental competencies, demonstrated through past experiences and training, include interpersonal and communication skills, integrity and honesty, continual learning, and commitment to public service. Executive Core Qualifications involve elements such as vision, strategic thinking, team building, accountability, entrepreneurship, and the mastery of institutional and external politics. While evaluations of SES members are specific to each agencys goals and performance expectations, these evaluations are supposed to be standardized and monitored by the Office of Personnel Management through supervisory bodies such as Performance Review Boards. Despite this requirement for a disciplined review mechanism, the GAO has found little variation in actual ratings, which reduces the incentives for higher performance As a result, the GAO recommended the reform of rating levels and more consistent use of agency safeguards. Problems with Current Reality Flaws in the Senior Executive Service (SES) suggest the need for stronger leadership. Originally, the SES was designed to be a highly selective body of executives within the federal government, with exceptional management skills. Leaders and managers within the SES are the critical link between top-level appointees and the vast federal workforce, and they direct and oversee the work of about 75 federal agencies. Yet a 2009 Partnership for Public Service report concluded that the SES has not realized its potential and is not operating as it was originally intended. The report cites the following flaws:
A Stationary Corps: Senior executives often remain in the same agency and do not cycle through different departments, as the program initially intended as a way to encourage collaboration and shared best practices. Lacking in Strategic Management: Executive leaders do not think strategically enough about management because they are concerned with the day-to-day operations and specializations of their agencies. In fact, the authors argue that many members of the SES should, in fact, be in the Scientific and Professional or Senior Level job categories. A Sluggish Selection Process: The SES hiring process is overly complicated, drawn-out, and far too time consuming. The process overemphasizes technical expertise rather than underscoring leadership skills and management capability. The Lack of Proactive Recruitment: Agencies rely too heavily on internal candidates and recruitment, and do not actively and regularly seek executive talent outside of the federal government. Additionally, internally recruited executives are not well trained without adequate candidate development programs and proper on-the-job development. Insufficient Compensation: Low starting salaries, compensation packages and pay caps for senior executives within the federal government are a significant barrier to recruiting talented leaders.
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The SES has the potential to drive productivity and workforce improvements, but may not be empowered to do so. Most members of the SES are motivated, dedicated, highly qualified, and acutely aware of problem areas not only within in their agencies and programs, but also within overarching federal workforce systems. They have the perspective to pinpoint obstructions in the federal bureaucracy, but too often lack the means to solve the problems they see. Past Efforts to Build Stronger Leadership In 1977, President Carter established the Presidential Management Fellows Program (PMF) by executive order to encourage high-achieving, advanced-degree graduates to embark on a leadership track in the Federal civil service. Fellows must be nominated by a university dean and complete a two-year professional development internship upon acceptance. Fellows generally enter the program at the compensation level of GS-9, but are offered pathways to rise to GS-11 and -12. The PMF is considered a successful program but continues to face challenges in developing and retaining effective future leaders. In 2001, for example, the U.S. Merit Systems Protection Board praised the PMF for its ability to recruit highly qualified individuals, as well as its success advancing fellows into high-level management positions. However, the report also suggests that more could be done to refine the purpose of the program and its adoption across agencies. Past administrations have used competitive compensation packages to attract talented and accomplished leaders with some success. Following the recommendations of the first National Commission on the Public Service (Volcker Commission), Congress and the president enacted the Ethics Reform Act of 1989, which gave Executive Schedule and SES employees a 25 percent pay increase. Since then, movement has been more incremental. As of 2009, the salary cap for the highest level of federal leadership remained less than $200,000 in annual compensation. Currently, the Obama Administration is commencing a renewed effort to improve the SES and to promote high performance not only among executives, but also throughout agencies. The OPM announced in August of 2009 that it was creating a new office to oversee the Senior Executive Service. This office would consolidate authority over the SES and would oversee the Qualifications Review Board, which would evaluate performance management, candidate development programs, and SES positions available across agencies and would hire new executives. SCARCE RESOURCES Current Reality The federal government does not allocate its resources effectively to ensure agencies are fully supported in achieving their goals. Productivity decreases considerably if an agency or individual employee does not have the appropriate funds to support its duties. Additional resources, such as training and development for staff, information technology and staff members, are critical to an agencys productivity. A 2010 Partnership for Public Service report noted that 68 federal level Chief Human Capital Officers and HR leaders were greatly hindered by insufficient investments in training. And according to the 2010 Federal Employee Viewpoint Survey, only 54 percent of federal employees felt that their training needs were met. Additionally, just 56 percent said that they are satisfied with the training they receive for their present job. Productivity gains are nearly impossible with limited training, obsolete systems, difficulty recruiting and retaining staff, and shortages of critical resources.
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Problems with Current Reality
Archaic Systems and Insufficient Training The perpetuation of poor training and ineffective systems will generate tremendous waste. For instance, in 2010, 80 percent of patent applications were received electronically, a vast improvement from days of dense paper applications. However, upon receipt of the application, Patent Office staff prints and scans applications by hand into an outdated case management system, resulting in an average approval time of three years. Since the case management system is so outdated, the receipt of electronic applications is actually an impediment to productivity rather than an aid to efficiency. The Census Bureaus repeated failure to train its employees is further evidence of productivity failure is another prime example. The Bureau was awarded a $595 million contract to upgrade their system in 2006, providing census workers with hand-held computers. Two years later, the system was abandoned, and census workers were back to pen and paper the agency citing miscommunication on system requirements as a major reason for the failure. In these cases, poor systems and a lack of training for new systems resulted in waste. Many Americans and government leaders regard the government as unproductive because it fails to keep pace with the private sector, particularly with regard to IT and systems. The White Houses commitment to improving technology employed by agencies will be beneficial, but adequate training on these new systems is critical. The massive egg recall in the spring of 2010 highlights further proof of inadequate training and number of Food and Drug Administration inspectors. In the wake of the salmonella outbreak, the FDA has launched FDA-TRACK, a new agency-wide program performance management system that monitors over 100 FDA program offices through key performance measures to temper concerns about high profile recalls in recent years, including spinach and peanut butter. According to OMB, the FDA has increased the number of employees trained in the Incident Command System (ICS), improving the agencys response to emergencies; developed a new risk-based approach for evaluating the safety, effectiveness, and quality and begun reducing vacancy rates on critical advisory councils. Efforts to increase training, enhance systems, and improve transparency will help to restore public confidence after scandal. Ensuring these measures are in place across agencies will prevent the crises that lead to a lack of faith in the federal government in the first place. Difficulty Recruiting Top Talent in an Aging Workforce The federal government has difficulty recruiting talented staff. Organizational management experts often say that a key ingredient to a high performing team of employees is the employee himself. Hiring the right people is critical to the success of any organization or business, and the federal government faces significant challenges in this area. According to the 2010 Federal Employee Viewpoint Survey, federal workers have alarmingly low confidence in their agencies ability to recruit talent. When asked whether they thought their work units were able to recruit people with the right skills, only 46 percent responded positively, and nearly 30 percent thought their agencies were unable to recruit qualified staff. A 2010 Partnership for Public Service report on the federal workforce emphasizes that issues of recruitment often stem from arcane federal hiring system and unsatisfactory HR professionals. Additionally, an antiquated and overly rigid pay and classification system and inequities in the pay flexibilities available to agencies are hindering efforts to attract, motivate and retain the quality workforce that is needed. Until very recently, the federal government took as long as 180 days on average to process an application and make an offer to a candidate. Under executive pressure to (1) shorten the hiring process to 80 days or less; (2) establish more communication with candidates at each stage of the process; (3) create a more efficient, resume-based application process; and (4) eliminate the Knowledge, Skills and Abilities (KSA) essays, which many consider a cause of delays, the hiring process has been reduced to an average of 105 days, and KSAs have been largely eliminated, although some agencies still incorporate them once a candidate is further along in the process.
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The aging federal workforce is problematic for recruitment of new talent for several reasons. First, the federal government has high turnover rate among new staff, which further exacerbates the recruitment challenge facing an aging workforce. In November 2010, a Partnership for Public Service report revealed that while overall attrition remained low, nearly 25 percent of new federal employees leave within two years, with the rates as high as 30 percent in certain departments. The report suggests that these rates for recently hired employees indicate weaknesses in the agency's recruiting, hiring and on-boarding processes, as well as shortcomings in supervision. Second, in the past decade, white-collar employees have shifted toward older age brackets, creating increases in the percent of employees in the 50-54 and 55-59 age groups and decreases in the 25-29 and 30-34 age groups. Between 1998 and 2008, the portion of the workforce aged 55 or older increased by over 60 percent, and as of 2008, the largest percentage of federal workers could be found in the 50-54 age bracket, compared to 45-49 in 1998. Finally, combining both those eligible for retirement and early-out retirement, over one-fourth of the Federal workforce is now eligible for exit. Staff and Funding Shortages Downsizing and deliberate cuts also drive staff shortages. While downsizing is often an important consideration, particularly in a down economy, there are consequences that negatively impact productivity. After the Reinventing Governments downsizing effort in the early 1990s, nearly half of 9,700 managers and employees surveyed believed that their units lacked enough employees to get their job done and considered institutional memory to have been eroded. In the same survey, 40 percent of respondents reportedly felt organizational productivity had been impaired. The events surrounding Hurricane Katrina illustrate the impact of insufficient number of staff, inadequate training and resources, and staff, and poor agency leadership at the Federal Emergency Management Administration. Failure to train emergency management personnel is one of the main reasons why roles and responsibilities were unclear during the disaster. As a GAO report notes, The readiness of FEMAs national emergency response teams was inadequate and reduced the effectiveness of the federal response. After the Homeland Security merger, FEMA had a vacancy rate of 15-20 percent, which resulted not only in a significant loss of institutional knowledge and experienced personnel, but also in a total lack of capacity to respond to the hurricane disaster. Finally, important preventative measures, such as hurricane simulations were not completed and fully evaluated because of insufficient financial support. Past Efforts to Address Scarce Resources New efforts to address resources deficiencies, such as the FDA tracking system and federal hiring reform initiatives, are important steps in ensuring agencies have the staff and systems they need to fully and effectively serve the American people. These resource problems, however, are widespread and complicated, and will take significant reform and time to be corrected. In recent years, several attempts have been made to tackle these productivity barriers, and with varying degrees of success. Senators George Voinovich (R-Ohio) and Daniel K. Akaka (D-Hawaii), sponsors of the previously discussed Federal Hiring Process Improvement Act of 2010, led human resources management reform efforts nearly a decade earlier. Voinovich and Akaka introduced personnel reform as a part of the Homeland Security Act of 2002. Under the legislation, Congress created a Chief Human Capital Officers (CHCO) in all major agencies to elevate human capital functions and needs within agencies, and to improve hiring and retention. A CHCO council was also established, providing a forum in which to exchange best practices and ideas. Agencies were granted greater flexibility in hiring staff and executive exit packages (buyout and retirement incentives). Enhancing the Government Performance and Results Act (GRPA), the bill also mandated that agencies include human capital strategic planning in Performance Plans and Program Performance Reports. The amendment increased agency resources and allowances to employees for job and agency-related training and academic advancement.
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POOR INCENTIVES FOR EXCELLENCE Current Reality Managers and executives either encourage productivity through incentives and rewards for innovation and high performance, a formalized pay-for-performance system, or through disciplinary action and consequences for poor performance. In the federal workforce, incentives are weak, rewards are often inconsistent or misused, disciplinary action is in short supply, and as of yet, merit pay systems have gained little traction. In the private sector, and increasingly among nonprofits, performance management systems are commonplace and a central mechanism for driving success. As of 2005, 90 percent of Fortune 1,000 companies and 75 percent of all U.S. companies linked employee performance to pay. The private sector and federal government differ significantly in this regard. The federal government has seen mixed and mostly unsatisfactory results in its past attempts at performance management and incentives systems, specifically pay-for-performance. Flawed Classification System The rigid pay and classification systems at the federal level present challenges for improving staff management and encouraging high performance. The General Schedule (GS) system determines the salaries of most federal employees. The GS is divided into 15 grades with accompanying salary ranges, according to the level and complexity of the job. Each GS grade has 10 steps, which result in increases in pay, based on time in service (a year or more between steps) and a performance rating of at least level 3, or Fully Successful. As of 2004, the average grade for federal employees was 9.89, with a median grade of 11. According to OPM, over 40 percent of the federal workforce falls between GS 9 and 12, with over 35 percent in GS 13-15, and just over 25 percent in GS 5-8. Federal employees who are not part of the General Schedule are paid through either the Federal Wage System, generally for blue-collar jobs, or the top-level SES or Executive Schedule. The President appoints Executive Schedule employees, who fall within five pay levels, ranging from administrators and deputy directors to Cabinet-level posts. Their raises are considered together with members of Congress, judges, and other top government officials, and are approved when Congress permits annual increases based on changes in the employment cost index (ECI). For federal employees in the SES, there are six compensation rates, which are adjusted to reflect local labor-markets and account for regions with a higher cost of living and higher-paid private sector peers. Caps on SES salaries correspond to pay rates within the Executive Schedule. Pay schedules are barriers to productivity even though they were designed to streamline and manage human capital across agencies and levels of government. On one hand, promotions and raises are granted with time and provide little incentive. On the other hand, insufficient salaries at the executive level fail to attract top-notch talent. As discussed previously, hiring systems and timelines deter applicants, and rigid management policies leave little room for flexibility within agencies to foster innovation, retain highperformers, and experiment with new methods for driving efficiency. Problems with Current Reality Inadequate Rewards and Discipline Measures Poor disciplinary action within agencies and perceptions that exceptional performance is not met with rewards negatively affect federal employee motivation. Most federal workers within the General Schedule receive pay increases every year, and according to OPM, over three-quarters of raises are independent of annual evaluations of employee performance. This is true despite the fact that current regulations allow for the use of some performance-based system elements, highlighting a failure both to implement performance management measures, as well as to conduct effectual assessments of employee performance.
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Federal employees readily highlight the lack of a connection between pay, promotion, and performance. According to the 2010 Federal Employee Viewpoint Survey, only 35 percent of federal employees think that promotions in their work unit are based on merit, in fact, even more (37 percent) believe that promotions are not based on merit. A dismal 26 percent of employees believe that pay raises depend on how well employees perform their jobs, and nearly half (45 percent) responded by saying that pay raises do not depend on performance. In terms of disciplinary action, less than a third of federal employees reported that steps are taken to deal with a poor performer who cannot or will not improve. Nearly as many employees think that differences in performance are not recognized in a meaningful way, while only 41 percent of federal employees think that creativity and innovation are rewarded. There are some built-in performance incentives for full-time permanent federal employees despite these alarming statistics on federal employee attitudes toward performance-related rewards and discipline. Awards and bonuses are the most common of these incentives; specifically, one-time payments based on performance, recruitment, retention or relocation, or time-off awards. Additionally, employees may receive rewards and incentives through promotions, quality step increases, and intra-governmental transfers. For senior executives, particularly the SES, performance bonuses and individual retention allowances are a common way to boost overall compensation. Given evidence of low morale in this area, it would seem that these efforts are not effective at boosting productivity government-wide. These mechanisms may be somewhat effective at supplementing salaries to compensate for base salary differentials between the public and private sectors; however, particularly in the case of the SES, rigid caps are still widely criticized as a barrier to recruiting first-rate leaders. Furthermore, while bonuses may boost overall compensation, their effect on productivity is questionable. Challenges Implementing Pay-for-Performance Pay-for-performance can be a powerful tool for driving employee productivity and overall success. The federal government, however, faces particular barriers to implementing such a system effectively. A GAO report warns that the federal governments outdated compensation structures and ineffective motivational tools do not achieve maximum results. The report goes on to suggest that it is imperative to transform the federal governments pay system, updating it to be more market-based and performance-oriented. However, in looking at attempts by government agencies to implement pay-for-performance, there are major roadblocks, including insufficient monetary incentives, flaws in rating systems such as those that award uniformly high bonuses and a lack of knowledge and experience among personnel officials and management in executing performance-based pay. The Partnership for Public Service argues that organizations with a civic mission may have a harder time establishing effective performance metrics than companies with a more quantifiable bottom line. Moreover, employees may be more motivated by the opportunity to contribute to a greater public good than by monetary incentives. Additional conditions that may lead to failure are objectives that do not align with the necessary duties of the agency or that are changed abruptly, rewards that result in unproductive levels of competition, perceptions of favoritism, and insufficient monetary incentives. Past Efforts to Create Incentives Private sector companies are pursuing the group merit pay approach in greater numbers. In the mid 1980s, research showed that most companies using this method for performance appraisal experienced improvements in productivity, reduced costs, and other operational improvements, in addition to increased morale, improved attitudes, and better overall quality of work-life. The federal government has had less success in creating productivity incentives for its employees, but there are a few demonstration projects that may offer praiseworthy practices.
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Civil Service Reform Act of 1978 Initiatives to implement pay-for-performance at the federal level have, in general, not been very successful. The Civil Service Reform Act of 1978 included performance-based pay efforts, but most have been abandoned, and are not thought to have increased employee motivation and organizational performance. Furthermore, it is generally considered difficult to design performance appraisal systems within government that are not only effective, but also perceived to be fair. Recent presidents have also expressed a need to stem the balkanization of federal government. The 1978 Civil Service Reform Act opened the door to agencies experimenting with different models of HR management. As a CRS report describes, there has been a decline in the use of the General Schedule pay system over the past decade, which corresponds to an increase in agency-specific pay structures. The report predicts, If recent trends continue into the future, the GS system will cover less than half of the federal workforce within the next 15 years. Ultimately, the GS would be replaced by agency-designed systems. Although some of these individual systems have garnered positive results, the OPM has not been successful at replicating best practices learned from these systems government-wide. With agencies continuing to pursue individual methods, the Director of OPM and President Obama have both articulated a desire to develop a single government-wide pay-for-performance system. National Security Personnel System The Department of Defense (DOD) National Security Personnel System (NSPS) is an example of a failed pay-for-performance system. Created during the Bush Administration and modeled after the Department of Homeland Security Personnel System, the NSPS has received criticism for its limitations on collective bargaining, a 2008 Federal Times analysis of NSPS pay increases suggested that the system was biased against minorities. The Congressional Budget Office also conducted an extensive evaluation of the system and found the weak support it received among employees problematic. According to the evaluation, only 15 percent of those covered by the system thought it was better than its predecessor. The Obama Administration abolished NSPS in 2009 with the Defense Authorization Act. Although NSPS was dismantled, OPM remains committed to looking into new pay-for-performance models. Air Force Pacer Project Air Force Pacer Share Project implemented a unit-based merit pay system and saw mixed results. While work climate improved, there was no impact on productivity, as compared with both baseline data and control groups. Additionally, employees conveyed dissatisfaction with the connection between pay and job performance, as well as with opportunities for advancement. Reflections on this and other group-designed approaches indicate that it is important for the culture of the agency to match the method group merit pay should exist in an environment where group work is commonplace and well managed. Demonstration Projects: China Lake & NIST After the passage of the Civil Service Reform Act, the United States Navy launched a demonstration project known as China Lake in 1980, which implemented an integrated approach to pay, performance appraisal, and simplified position classification. The Navys methods involved pay banding, which blended GS grades to create wider pay ranges and more flexibility in determining initial compensation and raises for achievement. Experts praise China Lake as a successful example of pay-for-performance, as well as an important foundational experiment in alternative compensation strategies. According to a GAO analysis of common strategies used at China Lake, National Institute of Standards and Technology (NIST), and the Naval Research Laboratory (NRL), past efforts to link pay to performance involved a tiered effort using competencies to evaluate employee performance; translating employee performance ratings into pay increases and awards; considering current salary in making performancebased pay decisions; managing costs of the pay-for-performance system; providing information to employees about the results of performance appraisal and pay decisions. Looking specifically at the
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National Institute of Standards and Technology, GAOs research found that employee perceptions did indeed confirm a link between pay raises and performance. Employees also believed that within the system, low performers left while high performers stayed. However, this success may have reflected the tight organizational culture surrounding science and engineering, and the highly specialized workforces engaged in the experiment. Despite these promising examples, the overall evidence related to merit-based pay systems in the federal government remains mixed, and perceptions of poorly directed rewards and discipline persist. The Obama Administration has outlined an agenda for improving the management of the federal workforce, with priorities that include the recentralization of hiring and pay, as well as an emphasis on pay-forperformance. Critical analysis of past failures and promising practices in federal performance-based pay will help to avoid repeat implementation mistakes. PRACTICAL RECOMMENDATIONS FOR REFORM 1. Establish accurate and effective measures of government productivity, and set a goal of a three percent gain in productivity each year. The federal government has not measured its productivity since 1995. Unlike the private sector, the federal government has very limited ways to measure its outputs. The federal government should adopt a stronger and more targeted system of performance measurement and evaluation to guide policy and management choices. Estimated Savings: Positive, but not yet scorable 2. Streamline the presidential appointee process. Congress needs to enact legislation requiring: (1) the President to make nominations within 120 days of a vacancy; (2) the Senate limit the personal use of holds to no more than 30 days; and (3) the Senate to discharge its advise and consent within 120 days hence. Estimated Savings: Positive, but not yet scorable 3. Create an effective results-based pay-for-performance system for all federal employees with waivers for work-group based pay for performance, while building effective training and monitoring systems for assuring fairness in the system. Estimated Savings: Positive, but not yet scorable 4. Provide leadership, resources and training for high performance government: a. Reform the Senior Executive Service (SES) to restore its original intent as a highly mobile and talented workforce. Senior executives suffer from immobility, lack strategic management, get bogged down in the hiring process, and are insufficiently compensated. b. Identify federal training budgets as a line item in the Presidents budget and set a goal of increasing training to match private sector investment. Good talent often goes to waste without proper training and resources for top federal employees. Excellent training is a non-negotiable that should not be subject to Congressional approval. c. Expand hiring opportunities for bringing outside talent into jobs at all levels of government, while limiting automatic promotions and step increases based on time on the job and seniority. d. Accelerate and streamline the hiring process to reduce delays in replacing essential employees. The current hiring process is painfully slow, which deters the recruitment and retention of many talented employees each year, thereby reducing the governments potential productivity. Estimated Savings: Positive, but not yet scorable
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5. Establish precise definitions of pay comparability that measure job requirements as the basis for implementation of the Federal Employee Pay Comparability Act, while basing pay comparability on the expertise needed to perform specific jobs. Estimated Savings: Positive, but not yet scorable
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CONCLUSION
The American people deserve a government that is accountable, efficient, and productive. Federal government reform dates back to the first days of our country and is built into our Constitution. However, the government has failed to keep apace with rapid technological and global changes that have occurred since the Hoover Commission in 1960, resulting in a bureaucracy that is outmoded, overcrowded, inefficient, and unproductive. The federal government is now responsible for an enormous mission. New webs of positions, agencies and programs that have been created over time to carry out this mission have only served to further dilute clarity of command and diffuse accountability. The government now has more layers of management and more employees occupying each position than at any point in history. Lack of oversight, poor performance measurement and lack of incentives for innovative leadership breed inefficient systems and incredible waste. Finally, poor leadership, scarce resources, and a lack of incentive system for federal employees contribute to an unproductive workforce. These three challenges are apparent to the American people. The resulting crises that occur from a poorly performing government only fosters mistrust in governments willingness to do its job well, especially when the private and nonprofit sectors continue to seek excellence in accountability, efficiency and productivity. Insofar as these challenges go unaddressed, federal governments ability to fully and effectively honor its obligations to the people is greatly reduced. Simply put, the federal government needs comprehensive reform in order to be sustainable into the future as a visible signal to the American public and the federal establishment that the time for piecemeal reform is over. A comprehensive package will produce greater accountability, efficiency, and productivity in government, and could reduce the federal debt by as much as $1.5 trillion over the next decade. The problem is not that there have been too few recommendations (see Appendix A) but that there are too many that focus on piecemeal reform. Almost all of the ideas cannot be scored for savings using the current congressional budget scoring system. As a result, Congress and the President are flooded with good ideas for action from both sides of the aisle but do not have a compelling case for action without a mechanism for implementing these recommendations, especially during these times of intense budgetary stress. To implement the full set of reforms outlined in this paper, we strongly propose the establishment of a Government Reform Corporation (GRC) to develop legislative proposals for immediate action through fast track, up-or-down votes. Modeled after the Resolution Trust Corporation (RTC), the GRC would serve as a temporary, highly agile, quasi-independent governmental corporation. The Government Reform agency would have the full authority to submit legislative proposals to the President and Congress for an immediate up-down vote. This highly visible reform model would not only be efficient and cost-saving in the long term, but would also send a clear message to the American people that federal government is finally going to tackle some of its most deep-seated problems with effective and large-scale reforms.
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APPENDIX A: PAST RECOMMENDATIONS FOR REFORM

ACCOUNTABILITY Reduce the Number of Political Appointees Score: 5 Impact: Positive Political Feasibility: Savings: Immediacy: Visibility: Reducing the number of political appointees would accomplish a number of goals: limit the amount spent on high salaries of appointees, encourage continuity in the leadership of executive agencies, and make room for career public servants to grow into expert leadership positions. The 1989 Volcker report identifies two different targets for reductions: limiting total appointees in the executive branch by 33%, and limiting the percentage of leadership positions that are appointed in each Cabinet-level agency (currently set at 25%, no lower alternative is given). The Legislative and Executive branches must work together to selectively identify political positions that could be changed to career positions or terminated altogether (RAND 37-38). Sources: RAND--The Volcker Commission. High-Performance Government: Structure, Leadership, Incentives. 2005. http://www.rand.org/pubs/monographs/MG256.html Report of the National Commission on the Public Service. Leadership for America: Rebuilding the Public Service. 1989. Report of the National Commission on the Public Service. Urgent Business for America: Revitalizing the Federal Government for the 21st Century. January 2003. Brookings, E.J. Dionne, Jr., William A. Galston, Senior Fellows, Governance Studies, December 2010, http://www.brookings.edu/papers/2010/1214_appointments_galston_dionne.aspx
Require an Implementation Impact Statement for Pending Legislation Score: 4 Impact: Positive Political Feasibility: Immediacy: Visibility: Implementation analysis would be administered by the Government Accountability Office, and would draw on the Congressional Budget Offices experience with budget scoring of legislative proposals. Even though Implementation Analysis does not provide a complete cookie cutter methodology for all types of proposals or a single quantitative indicator of a proposals feasibility, having a checklist of standards and concerns that can be applied when a policy proposal is being considered can highlight potential troublespots early in the policymaking process and improve government performance once an initiative has been enacted. Thus it can provide information that is useful not only in deciding whether to implement an initiative but also how to do so. Source: Brookings, R. Kent Weaver, Senior Fellow, Governance Studies, February 2010, http://www.brookings.edu/~/media/Files/rc/papers/2010/02_implementation_analysis_weaver/02_im plementation_analysis_weaver.pdf, http://www.brookings.edu/papers/2010/02_implementation_analysis_weaver.aspx
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Strengthen Ethics and Disclosure Requirements for Federal Contractors Score: 3 Impact: Positive Immediacy: Visibility: When working on behalf of the federal government, contractors should be held to a similar standard as public servants. One proposal from the Office of Inspector Generals includes a comprehensive ethics and transparency system for government contractors. A transparent disclosure system for contractors would help restore the publics faith in government projects managed by non-governmental actors. Source: Robert I. Cusick. Journal of Public Inquiry. Outsourcing Public Integrity, Fall/Winter 2007/2008
Eliminate Antiquated, Underperforming and Duplicative Programs Score: 4 Impact: Positive Political Feasibility: Savings: Immediacy: Visibility: Many programs perform functions that could be carried out more effectively elsewhere in the government. And some programs are simply inefficient. Better performance management and evaluation of program effectiveness is helping us make better choices about where to invest and where to cut. Through line by line reviews, we have proposed approximately $20 billion of terminations, reductions, and savings in both the FY 2010 and 2011 budgets. While recent administrations have seen between 15 to 20 percent of their proposed discretionary cuts actually approved by Congress, we worked with Congress to enact 60 percent of our proposed discretionary cuts for FY 2010. We are targeting even greater savings going forward. As part of the FY 2012 budget process, we have instructed agencies to identify their lowest-priority programs (equal to 5 percent of total spending) for consideration as terminations or reductions. Agencies are taking the hard step of identifying programs that are less central to achieving agency goals, have completed their original mission, or have an unclear or duplicative purpose. Source: Jeffrey Zients. Memo for the Senior Executive Service: The Accountable Government Initiative an Update on Our Performance Management Agenda. September 14, 2010. http://www.whitehouse.gov/sites/default/files/omb/memoranda/2010/AccountableGovernmentInitiative _09142010.pdf. p. 5.
Restructure Congressional Committee Jurisdictions Score: 3 Impact: Positive Immediacy: Visibility: Reorganizing the divisions of House and Senate committees so that they are aligned with each other and executive branch divisions would have the combined effect of clarifying lines of responsibility, reducing wasteful overlap, and duplication of effort. While recognizing the benefits of a complete overhaul, the committee refrained from endorsing such a proposal because it would be politically infeasible. Source: Organization of the Congress Final Report (1993), in Reorganization of Congress: Modern Reform Efforts
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Ensure that Inspectors General have Sufficient Funding, Staffing, and Resources to Expose Wasteful and Abusive Spending. Score: 5 Impact: Positive Political Feasibility: Savings: Immediacy: Visibility: Auditors and IGs are on the front lines of rooting out wasteful spending in federal agencies. It is essential that these offices have the funding, staffing, and resources they need to do their job. Unfortunately, many oversight and IG offices are overworked and understaffed. For instance, a 2008 DoD IG report found that while Pentagon spending has soared in recent years to cover the costs of the global war on terrorism and the wars in Iraq and Afghanistan, staffing at the IG office has remained nearly constant. As a result, in FY 2007 nearly half of the $316 billion spent on weapons acquisition did not receive sufficient audit coverage. Congress needs to provide auditors and IG offices with sufficient resources so that they can be truly effective junkyard watchdogs. A 2002 POGO report found that at the Defense Criminal Investigative Service (part of the DoD IGs office), every dollar spent resulted in $14 in anticipated recoveries. In addition, in FY 2008, federal contracting officers did not uphold the Defense Contract Audit Agencys (DCAA) findings on $6.5 billion in questioned, disallowed, or unsupported contract costs. This represented over one-third of all costs found to be unsupported by DCAA. If implemented, the combined recommendations by IGs and the DCAA would potentially result in $31.5 billion in savings. If agencies decide not to implement these recommendations, they should at least be required to provide a compelling reason for not doing so. Source: Easy Money: Top Five Recommendations for Increasing Revenue and Cutting Costs, Project on Government Oversight, February 27, 2009. http://www.pogo.org/pogo-files/reports/goodgovernment/gg-20090227.html
EFFICIENCY Create a virtual statistical agency Score: 5 Impact: Positive Political Feasibility: Savings: Immediacy: Visibility: The government should create a virtual U.S. statistical agency. Consolidating statistical infrastructure could slash spending on IT resources and support personnel by many billions of dollars. It would also link information for decision and policy-making (see technology recommendation on Creating an Open/Shared Technology Environment). Government data should not be owned by one department, agency, etc, it should be treated as a national asset. New standards should be developed for sharing data. Source: CAP, Compiled by Sarah Rosen Wartell; Forward by John D. Podesta, November 2010, http://www.americanprogress.org/issues/2010/11/pdf/executive_orders.pdf
Replicate the BRAC Model to Address Spending Reform Score: 5 Impact: Positive Political Feasibility: Savings: Immediacy: Visibility: The Base Realignment and Closing (BRAC) commissions of the late 80s and early 90s were remarkably successful because of their peculiar structures, not simply because they were commissions. They worked
because no member of Congress ever had to vote for shutting down any particular military base. A spending commission could curb discretionary spending successfully, but only if it embodies the lessons of BRAC. That means not just creating a commission, but making sure it is composed of independent members whose recommendations become binding without congressional action. A BRAC-style commission probably could not reform entitlement spending, which funds programs like Medicare/ Medicaid, Social Security, and veterans benefits. These programs are so large, so entrenched, and command such a strong lobby that it is difficult to see how Congress would ever cede decisions over them to an independent body. A spending commission that embodied the lessons of BRAC, however, could tackle discretionary spending, recommending the closing of specific federal programs on the basis of objective criteria. It would be composed of disinterested and respected public citizens and experts (for example, retired Supreme Court justices from each party would co-chair it) to whom Congress would also assign a guiding basis for program review, such as cutting programs that are empirically inefficient or wasteful. Source: Mercatus, Jerry Brito, February 2010; Mercatus on Policy, No. 70 (working paper)
Reduce Improper Payments While Improving Delivery of Services Score: 5 Impact: Positive Political Feasibility: Savings: Immediacy: Visibility: Program integrity efforts are designed to reduce mistaken and improper government payments to people and companies, which was estimated as a $125 billion problem in 2010. One such example is the White House's Partnership Fund for Program Integrity Innovation (part of the Accountable Government Initiative), which aims to test ideas for reducing improper payments (an estimated cost of $125 billion in 2010) while improving federal program service delivery. This fund is making headway through idea generators, improvements to systems, etc., but needs to look specifically at Medicaid, Medicare (both make up half of problem), HeadStart, and other large programs with high rates of improper payment. If this effort proves effective, Congress and the White House should be prepared to invest more money into this and other program integrity efforts. (Liz) Source: Center for American Progress, John Griffith, December 2010, http://www.americanprogress.org/issues/2010/12/program_integrity.html
Pass Sunsetting Legislation to Terminates Agencies and Programs After a Specified Period of Time Unless Reauthorized Score: 5 Impact: Positive Political Feasibility: Savings: Immediacy: Visibility: At a minimum, a new federal sunset process could help uncover serious management lapses at agencies before they explode into crises. Beyond averting federal management disasters, a sunset commission could lay out the facts regarding whether agencies and programs are needed at all. With the coming budget pressures of entitlement programs set to explode with the retirement of the baby boomers, Congress needs to start terminating or privatizing as many government programs as possible so that the next generation is not crushed with taxes. A new federal sunset process with a broad scope could help Congress make those needed reforms. In one recent example, legislation was introduced in 2002 by Rep. Kevin Brady (R-TX) to sunset most federal agencies every 12 years (H.R. 2373), but this did not gain passage. Source: CATO, Chris Edwards, May 2002, http://www.cato.org/pubs/tbb/tbb-0205-6.pdf Category: Efficiency, Accountability
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Leverage Federal Buying Power Through Blanket Purchase Agreements (BPAs) Score: 5 Impact: Positive Political Feasibility: Savings: Immediacy: Visibility: OMB recommends using Blanket Purchase Agreements for common commodity purchases across the federal government. This will leverage the huge purchasing power of government, as well as simplify the purchasing process for everyday items. The government expects to save $200 million over the next year alone based on recent blanket purchase agreements for office supplies. Source: Jeffrey Zients. Memo for the Senior Executive Service: The Accountable Government Initiative an Update on Our Performance Management Agenda, September 14, 2010
Enhance General Procurement Reform Score: 5 Impact: Positive Political Feasibility: Savings: Immediacy: Visibility: Centralize and coordinate policy and oversight responsibilities, increase competition for federal contracts, and improve contractor efficiency while eliminating management disincentives. The Grace Commission found limited and often inaccurate procurement information; decentralized, uncoordinated, and poorly planned acquisitions; disincentives to good management; and purchases that were neither efficiently nor cost-effectively handled because of excessive and inconsistent regulations. Source: War on Waste: Presidents Private Sector Survey on Cost Control, p. 91; also recommended in A $400 Billion Opportunity: 10 Strategies to Cut the Fat Out of Federal Procurement, Center for American Progress, November 2010 Category: Efficiency
Reform Federal Leasing and Dispose of Unneeded Real Property Owning Score: 5 Impact: Positive Political Feasibility: Savings: Immediacy: Visibility: The government could achieve considerable savings by building or purchasing property rather than leasing it, in some cases. As of 2006, the federal government occupied approximately 400 million square feet of building space through a combination of leased and owned real property. Although leases provide flexibility and may be useful for small amounts of office space, the GAO found that many millions of dollars could be saved if property was constructed/owned as opposed to leased. Per budget scoring, though, the full cost of construction or ownership must be recorded in the initial year, while lease costs appear annually, making ownership appear much more capital intensive than leasing, even when its net present cost is lower. Source: GAO-08-197
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Rebuild Capacity and Effectiveness of the Acquisitions Workforce Score: 5 Impact: Positive Political Feasibility: Savings: Immediacy: Visibility: The Office of Federal Procurement Policy and individual agencies should develop stronger tools and trainings for acquisition managers. According to OMB, while dollars spent on contracting more than doubled from 2000 to 2008, the size of the workforce responsible for managing Federal contracts remained flat. The President requested $158 million in the 2011 budget for building the capacity of the acquisition workforce, but a more large-scale reconsideration of workforce capabilities is needed. Source: Jeffrey Zients. Memo for the Senior Executive Service: The Accountable Government Initiative an Update on Our Performance Management Agenda, September 14, 2010
Reform the Federal Budget Process Score: 4 Impact: Positive Immediacy: Visibility: To combat fiscal imprudence and better illuminate intergenerational fairness in taxing and spending, the Committee on the Fiscal Future of the United States recommends instituting federal budget process reforms via statutes and/or congressional procedure (points of order). The current 10-years-forward scoring window should be supplemented by prominent, regular disclosure of longer-term projections and fiscal exposures, such as incremental pension/maintenance costs for new programs and capital expenditures. Federal government financial statements should either replace or supplement cash-basis accounting with accrual accounting standards, which will minimize budgetary tricks and better capture long-term and contingent liabilities. The President and Congress should also consider setting hard fiscal targets (such as limiting debt to 60 percent of GDP, or the deficit to 2 percent of GDP) with automatic, predetermined spending/revenue mechanisms that rebalance the governments long-term fiscal position when necessary. Disclosures of the discretionary and entitlement fiscal position should also be updated and published more frequently. Source: Choosing the Nations Fiscal Future, Committee on the Fiscal Future of the United States (Collaboration of the National Academy of Public Administration and the National Research Council of the National Academy of Sciences), 2010. See Chapter 10 and Appendix G, http://www.ourfiscalfuture.org/thereport/ PRODUCTIVITY Reshape the Federal Workforce by Selective Replacement after Attrition Score: 5 Impact: Positive Political Feasibility: Saving: Immediacy: Visibility: To reduce the size of the federal workforce, the CBO offers a recommendation of only hiring 2 new employees for every 3 that depart. In 1993, CBO estimated the average five-year savings from reducing one job using this tactic would be $178,400 (versus $183,000 if one worker was laid off), while avoiding many of the negative effects of layoffs on staff morale. Source: CBO. Reducing the Size of the Federal Civilian Work Force. December 1993. pg. 39 http://www.cbo.gov/ftpdocs/104xx/doc10419/1993_12_reducingsizeoffederalcivilian.pdf

Create Separation Incentives
Score: 5 Impact: Positive Political Feasibility: Saving: Immediacy: Visibility: Separation incentives, including early retirement bonuses, could effectively reduce the size of the federal workforce. These incentives could be targeted at particular organizations, occupations, or locations to minimize costs. CBO estimated the average five-year savings from reducing one job using separation incentives would be $125,600 for early retirees and $159,600 for other resigning employees (versus $183,000 if one worker was laid off). In addition to monetary savings, such incentives can help with other personnel management issues, like reducing the number of senior staff to make room for career growth of lower level employees. Source: CBO. Reducing the Size of the Federal Civilian Work Force. December 1993. pg. 39 http://www.cbo.gov/ftpdocs/104xx/doc10419/1993_12_reducingsizeoffederalcivilian.pdf
Recommendations to Improve Reduction-in-Force (RIF) Procedures Score: 5 Impact: Positive Political Feasibility: Saving: Immediacy: Visibility: PPSS made three primary recommendations to improve RIF procedures: (1) assigning greater weight to performance and efficiency in determining employee ratings in RIF procedures. For example, veterans preference has excessive weight in determining point assignments, while performance has too little weight. (2) Limiting bumping and retreating rights (displacing employees with lower standing) to not more than one grade level lower than the position which the RIF employee is released to prevent excessive and indiscriminate displacement and the loss of valuable employees. (3) Designating separate retention lists by clerical and nonclerical classifications. Establishing lists on this basis will help to lessen disruption by eliminating replacement of highly skilled clerical employees by marginally skilled or unskilled nonclerical employees. Source: War on Waste: Presidents Private Sector Survey on Cost Control, p. 255.
Reform Retirement Systems to Reduce Costs Score: 4 Impact: Positive Political Feasibility: Savings: Immediacy: Visibility: PPSS reviewed the two largest Federal retirement systems, the Civil Service Retirement System (CSRS) and the Military Retirement System (MRS), which together cover approximately 98% of all Government employees, and concluded that Government retirement plans provide benefits and incur costs three to six times as great as the best private sector plans. PPSS recommendations would reduce Federal retirement costs to levels comparable to those in the private sector by increasing the normal retirement age from 55 in CSRS and about 40 for MRS to age 62, reducing benefits actuarially for retirement before age 62, revising the benefit formula to define base earnings as the average of the highest five years salary (versus three years in FY 1982), and revising cost-of-living adjustments to reflect prevailing private sector practices. Source: War on Waste: Presidents Private Sector Survey on Cost Control, p. 265.
Use New Technologies for Faster, More Transparent Freedom of Information Score: 4 Impact: Positive Political Feasibility: Immediacy: Visibility: Report suggests using new technologies such as a centralized, searchable database to cut down paperwork and administrative overhead, consolidate overlapping requests. Source: Center for American Progress, Compiled by Sarah Rosen Wartell; Forward by John D. Podesta, November 2010, http://www.americanprogress.org/issues/2010/11/pdf/executive_orders.pdf
Improvements to the Senior Executive Service Score: 1 Impact: Positive To improve the performance and appraisal of the SES, the GAO recommended in 2008 that the OPM guide the Senior Executive Service in reforming rating levels for executives, and ensuring more consistent use of safeguards (such as Performance Review Boards) by agencies. This was due to the fact that in FY 2007, most were clustered within the top two rating levels, leaving little room for meaningful appraisal and rewarding based on performance. The GAO recommends that OPM direct agencies to use a wider range of levels for assessment. Similarly, the OMB recommends investing in SES recruitment, appraisal, and development. The Presidents Management Council recently launched a collaborative, cross-agency effort to identify and implement best practices in these areas, which are expected to yield actionable suggestions in the next year. Finally, some reform advocates recommend that the creation of an Executive Management Corps would allow top government managers mobility to move between agencies and the opportunity to earn more performance-based pay. The 2003 Volcker Commission envisioned splitting the current SES into distinguished groups of managers (EMC) and a Professional and Technical Corps, the latter keeping a similar structure to the current system. Sources: Results-Oriented Management: Opportunities Exist for Refining the Oversight and Implementation of the Senior Executive Performance-Based Pay System; GAO, November 2008. Report of the National Commission on the Public Service. Urgent Business for America: Revitalizing the Federal Government for the 21st Century. January 2003. Jeffrey Zients. Memo for the Senior Executive Service: The Accountable Government Initiative an Update on Our Performance Management Agenda. September 14, 2010. http://www.whitehouse.gov/sites/default/files/omb/memoranda/2010/AccountableGovernmentInitiative _09142010.pdf. pg. 13.
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Establish a pay-for-performance system Score: 5 Impact: Positive Political Feasibility: Saving: Immediacy: Visibility: Within a broader performance management agenda, establish a pay-for-performance system that is particularly sensitive to government pitfalls. Specific suggestions include adequate training of administrators to ensure effective implementation and use of assessments, enough funding to differentiate between levels of performance and provide meaningful incentives, transparency to prevent political misuse and encourage employee commitment. Source: Partnership for Public Service; Issue Brief; March 2005 http://www.ourpublicservice.org/OPS/publications/viewcontentdetails.php?id=40
Establish Results-Oriented Pay Reform Score: 4.5 Impact: Positive Political Feasibility: Savings: ? Immediacy: Visibility: In a 2003 report, the GAO recommended that in addition to pursuing performance-based pay possibilities, the federal government should continue to allow agencies flexibility in trying new, alternative approaches to pay systems. Specifically, they recommended that Congress explore the benefits of broadbanding by (1) giving OPM additional flexibility that would enable it to grant government wide authority for all agencies (i.e., class exemptions) to use broadbanding for certain critical occupations and/or (2) allowing agencies to apply to OPM (i.e., case exemptions) for broadbanding authority for their specific entities or occupations. They added that there should be a mandate for agencies to demonstrate they have modern, effective, credible, and validated performance management systems in place before they are allowed to use broadbanding or related pay for performance initiatives. Source: Results-Oriented Cultures: Modern Performance Management Systems Are Needed to Effectively Support Pay for Performance; GAO, Tuesday, April 1, 2003; J. Christopher Mihm.
Invest in SES Recruitment, Appraisal, and Development Score: 2 Impact: Positive Political Feasibility: OMB recommends investing in Senior Executive Service (SES) recruitment, appraisal, and development. The Presidents Management Council recently launched a collaborative, cross-agency effort to identify and implement best practices in these areas, which are expected to yield actionable suggestions in the next year. Source: Jeffrey Zients. Memo for the Senior Executive Service: The Accountable Government Initiative an Update on Our Performance Management Agenda. September 14, 2010. http://www.whitehouse.gov/sites/default/files/omb/memoranda/2010/AccountableGovernmentInitiative _09142010.pdf. pg. 13.
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CREATING HIGH PERFORMANCE GOVERNMENT: A ONCE-IN-A-GENERATION OPPORTUNITY