Federal Diary Live

Federal employees looking for a roadmap to the future will want to check out "Six Trends Transforming Government," an analysis prepared by three senior staff members of the IBM Center for the Business of Government, based in Washington, D.C. The authors of the new report believe the challenges facing government call for comprehensive and profound change.

Mark A. Abramson , the IBM Center's executive director, Jonathan D. Breul and John M. Kamensky , IBM senior fellows, took your questions and comments on Federal Diary Live Wednesday, Sept. 20. at noon ET . Stephen Barr , who writes the Federal Diary column for The Post, served as the session's moderator.

Trends transforming government performance includes changes to civil service rules, the use of performance management, competitive sourcing, on-demand performance, citizen engagement and the use of networks and partnerships.

Abramson, a fellow at the National Academy of Public Administration, served as the first president of the nonprofit Council for Excellence in Government. Breul, a former senior adviser at the Office of Management and Budget, helped develop President Bush's management agenda and was instrumental in establishing the President's Management Council. Kamensky, who worked at the Government Accountability Office for 16 years, served for eight years as the deputy director of Vice President Gore's National Partnership for Reinventing Government.

The transcript follows.

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Stephen Barr: Thanks to all joining this discussion today, especially our guests from the IBM Center for the Business of Government--Mark Abramson, Jonathan Breul and John Kamensky. I'd like to open this discussion by asking our guests to narrow their six tends--which ones are really the most important, at this time, in the government? Hopefully, that'll kick off a wide-ranging chat today. My special thanks to Mark, Jonathan and John for sharing their time with us.

Mark A. Abramson: Let me add one that is receiving a lot of attention today. We think all are important, but we recognize that each is at a different stage of learning. I think government faces a challenge in effectively learning how to use tools such as competitive sourcing. We need to both learn how use the tool and to make it less contentious and politically volatile.

Jonathan D. Breul: The first trend transforming government has been the growing effort to change the "rules of the game" of government. Reform of the civil service system has become a major national issue, with new managerial flexibility in the creation of the Department of Homeland Security and separately in DOD with the National Security Personnel System.

John M. Kamensky: Another issue that is increasing in importance is the OMB Program Assessment Rating Tool. This year, after 5 years of development, OMB will finish assessing all 1,000 government programs. What's next? Will this information be used to make tradeoffs between programs?

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Fort Belvoir, Va.: Is there an single organization for the federal government that feeds lessons learned? We are all trying to build a better mouse trap -- and I'll bet many times in the federal battlespace that mousetrap has already been built. Logistics and personnel are the two areas that come to mind immediately. THE BEST SYSTEM for doing these things should be defined and used system (federal) wide, without fail.

Mark A. Abramson: I think this is an excellent question and an area in which government needs to do better. There clearly needs to be more learning across agencies. I would like to see the Office of Personnel Management do more in exchanging the latest ideas about best practices in personnel management. I think the Office of Federal Procurement Policy has tried to fulfill this role in the past regarding best procurement practices and I would like them to do more exchange about best practices in the future.

Jonathan D. Breul: Many human capital management experts believe that other agencies would do well to heed the lessons of the Government Accountability Office (GAO) use of human capital to transform their culture.

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Washington, D.C.: What do the authors think of this administration's approach of "one size fits all," especially concerning the e-gov initiatives. While economies can be achieved in some areas, it seems we are spending more for less in other areas.

Jonathan D. Breul: In changing "the rules of the game," many governments are increasingly discarding one-size-fits-all approaches, permitting departments and agencies more managerial flexibility with customized operating procedures and approaches to delivering services.

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Washington, D.C.: What roles do political appointees and union leaders play in setting government trends, especially those labeled transforming? Thank you.

Mark A. Abramson: For government to achieve its full potential and to implement many of the six trends we discuss in our paper, there needs to an effective partnership between political leaders and the unions. Neither one of them can accomplish government change by themselves. I think relationship between political appointees and unions can clearly be improved and is needed.

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Washington, D.C.: What are the key elements of performance budgeting, especially at a time when Congress cannot be relied upon to provide funds as promised (see almost any DHS initiative, for an example)?

Jonathan D. Breul: A second key trend - perhaps a linchpin - is the increased use of performance management in governments around the world. Some experts contend that the US federal government has never been in a better position to make its budget decisions more informed by considerations of performance. An IBM Center report by Burt Perrin identifies the state of the art practices and thinking - but make it clear that there is no one "correct" or best model that could or should fit all countries.

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Falls Church, Va.: What grades would you give the Bush administration on engaging/responding to these trends? They certainly haven't gotten much traction on e-gov, as they define it, and technology seems to be an important consideration for you IBM types.

Mark A. Abramson: I would give them a different grade on each of the six trends. The administration is still working on changing the personnel rules in HHS and DOD, so they get an incomplete on that. I think they are making substantial progress on using performance management as exemplified in the PART process. There is clearly room for improvement, however, in the area of market based government in which the administration needs to work closer with Congress in developing a better understanding of how tools such as competitive sourcing can be effectively implemented.

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Washington, D.C.: Steve Barr calls your paper a "roadmap" to the future. Exactly what future do you see out there for us feds?

Jonathan D. Breul: The imperatives and strategies described in our "Six Trends" report are making a difference in government today. Improving government management remains a complex and difficult assignment, both technically and politically. Management is no longer seen as a centralized, one-size-fits-all uniform undertaking. Our works suggests three new challenges ahead for federal employees: (1) using networks to organize for routine and non-routine problems, (2) developing a way to govern through a "network of networks," and (3) engaging citizens in new roles to solve public problems.

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Annapolis, Md.: I have read some of Mr. Abramson's work and a recent IBM publication that included discussions of human capital strategies at USAID. My reflections regarding trends in government are that a manager and hopeful leader must actually understand the psychology behind the current situation and the improved system for something like performance based management to work. How would you suggest that agencies like DoD and DHS help long time managers understand and accept the behavioral dynamics/motivation behind today's knowledge worker so that both the worker and the manager can maximize the new system?

Mark A. Abramson: Excellent question. Throughout my career, I have been a strong proponent of executive education. You need to prepare people in government for their careers and giving them both "on the job" training, experiential training, and mobility. I think there is much to be learned about how you "manage" knowledge workers in a flat organization. Executives can really learn -- both in the classroom and via their own experience -- how you motivate employees and created a collegial team environment.

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Warren, Mich.: Hi Steve and Guests,

The six trends are fine as talking points. But, the tactics by the Bush administration so far on changing personnel systems have been extreme. The SES system survey revealed the admission of quotas being used to limit higher ratings and awards. What are your thoughts on this admission and the Bush tactics in general?

John M. Kamensky: The recent SES survey does suggest a mixed review of the first full year of SES performance pay. The experience of using performance pay in the private sector suggests that it takes several years to "get it right" so the culture focuses on performance and results of individuals being rated vs. personality and quotas. Getting it right, though, means senior managers and leaders have to care and make it a priority. The SES results are a good indicator of the need for better management training and awareness before taking this kind of pay approach more broadly across the government. . . and this was the conclusion of GAO, which has been implementing a performance pay system over the past decade or more.

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Washington, D.C.: Sirs, how about a time out on transformation and a few solid years spent on cleaning up the GAO High Risk list? What do you say?

Jonathan D. Breul: A close look at the President's Management Agenda will reveal that most of the items are an effort to address the federal government's most significant, chronic management problems - corresponding very closely to the items on GAO's High Risk list. Financial management and human capital are two particularly important examples.

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Arlington, Va.: Your column on IBM's "6 Trends Transforming Government" is very interesting. But don't those 6 concepts contradict what was written on Sunday's front page about political appointees picked for work in Iraq by loyalty, not by competence ?

I guess my broad question is how does government operate well when political goals often conflict with quality assurance goals ? That can be true of both executive appointees and congressional mandates.

Mark A. Abramson: I believe we need highly qualified individuals in politically appointed positions. There is no shortcut for experience and quality individuals. You clearly need experience individuals to implement many of the six trends. We don't believe, however, that experience has all come from within the federal government. We have seen many examples of highly qualified political appointees who have added value to their organizations and worked closely with the career civil service in implementing management improvements. You need careerists and political appointees to create effective working relationships.

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Rockville, Md.: Do these trends apply to the military as well?

Jonathan D. Breul: Yes, indeed. The "Six Trends" are occurring at all levels of government within the United States - federal, state and local - and governments around the world.

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Virginia: I lived in Europe while I was U.S. government. There are very few political appointees, the top ministry person is always a political appointee, but the deputy to down were always career civil servants.

John M. Kamensky: GAO has recommended that several departments create a Chief Management Officer that would be a term appointment, possibly a career executive, to bring long-term management expertise, and stability, into senior ranks. This is roughly equivalent to the Deputy Ministers in many European countries.

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Easton, Md.: I am a big fan of continued improvement in public service, but these trends and tools fall flat and lose steam and trust when the politically appointed leadership pushes their own ego-driven initiatives (such as visiting every national park while in office) and where there is ineffective transition of vision and purpose between administrations. One example may be VP Gore's well understood GPRA initiatives and the ExpectMore.gov which suddenly appeared but may somehow be related. I always want to see the transition and heritage of one program to the other. What are the factors in attaining better transitions with stronger results for government performance, in the workforce, with citizen engagement, or from the 3 branches of government? Thank you!

Jonathan D. Breul: Forty years of presidential efforts to improve the management and performance of government suggest a number of clear and compelling lessons:

1. Start early

2. Establish an overarching set of principles and values

3. Secure and maintain top-level support

4. Link efforts to the budget

5. Coordinate and collaborate effectively with the agencies

6. Obtain support from Congress

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Rockville, Md.: Do you think there is a lack of capable project managers in the government?

Mark A. Abramson: I think there are many capable project managers in government, but I think we need more. Government needs to provide more training about what it actually means to be project manager. Today, not as as many executives as should view their job to be a project manager. There is much excellent training available on project management capabilities. We believe that such skills will be needed even more in the future as government continues to contract large projects to the private sector. We believe this trend will continue and hence the need for more and better trained project managers in the future.

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Washington, D.C.: What do we mean by market-based government? Thank you.

John M. Kamensky: Market-based government is a body of tools and incentives that guide public action by embodying some of the beneficial characteristics inherent in private sector markets, such as competition, choice, flexibility, voluntary entry/exit from using a service, etc. Providers of services may find this threatening (they face competition), but users find this approach more favorable - they have choices in providers, transparency in the quality of services, and more responsiveness. In government, this is probably more applicable to internal government services (HR, acquisition, IT services, etc.) but is also possible in mission-based services (i.e., use of vouchers in veterans education) or regulatory programs (i.e., tradable permits in EPA).

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Arlington, Va.: Gentlemen, do you foresee your trends changing or even fading in the post-Iraq, post-Katrina world of government? The failures of leadership by agency heads and senior administration officials suggests to me that the next two trends are Oversight and Accountability. Yes?

Mark A. Abramson: I think these trends are even more important now given examples such as Katrina. Katrina pointed out the needed for more effective use of networks and partnerships. There are many lessons to be learned from Katrina in how government can improved its partnerships with state and local government, as well as the non-profit sector. We believe in oversight and accountability, but would like to see more emphasis placed on learning lessons from the past and somewhat less emphasis placed on "blame."

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Redlands, Calif.: "Trends transforming government performance includes changes to civil service rules, the use of performance management, competitive sourcing, on-demand performance, citizen engagement and the use of networks and partnerships." This was a humor column, wasn't it? A trend normally covers a longer span of time than just 5-6 years.

--Changing civil service rules - in effect forcing out experience sooner than necessary, leaving the inexperienced to make more,bigger and more costly mistakes.

--(federal) Performance management - a way to free more money for congressional pork and/or the administrations priorities at the expense of the workforce. (I imagine it is the same in business - taking money from the workforce to redecorate the corporate board's dining facility.)

My opinion is that the three gentlemen who wrote this, see and accept trends because they benefit. If they were on the workforce end of things, they might have a completely different perspective. This is another way of saying that the winners (businesses) write history and the losers (workforce), well, lose.

Jonathan D. Breul: The "Six Trends" are occurring at all levels of government within the US - federal, state and local - and governments around the world. Many began in other countries and have been copied here. In other cases, the US was in the lead, spearheading a trend that has been exported to other countries. While none of us knows for certain what comes next, we believer that understanding these six trends can help government (and government employees) be better prepared to meet the challenges ahead.

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Richmond, Va.: What can be done to get Congress to recognize areas in their legislation that should be changed to enable agencies to operate within the budget they choose to give them. In my view Congress fails to give adequate funding to run some of the programs they passed. They should be required to fund that which they pass or modify it if they fail to fund adequately for it. VA and SS benefits are prime examples. There are some areas in each not intended in legislation but which continue to be a drain on the agencies operations.

John M. Kamensky: Congress sometimes makes decisions in the absence of clear information about agency programs. Agencies need to be able to clearly articulate what they do, how much it costs, and what the benefits are that result. Many agencies do not know what their programs cost (they don't have a good accounting system) and others don't know what the impact is of their programs). Agencies that do -- like the Bureau of Land Management has an activity-based accounting system that clearly attributes costs to activities, and the State Department has a good ability to describe its performance via the Program Assessment Rating Tool -- tend to be able to better defend their budgets.

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McLean, Va.: Hi, I'd like to know, what federal agencies have or will (soon) adopt performance management? What has been the reaction/response from federal employees? How will the compensation system align with performance management? Will pay become market driven?

Thanks!

John M. Kamensky: In one sense, performance management has been adopted by all agencies. All SESers fall under a performance pay system. A number of agencies have expanded to either managers, or all employees. For example, FAA and USPS cover all managers, and GAO covers all employees. DHS and DOD have statutory authority to expand systems to their workforces as well. I believe only GAO at this point explicitly has a market-based pay system.

John M. Kamensky:

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Washington, D.C.: This chat seems to underscore that leadership is vitally important to pulling off any transformation. What bright spots do you see in federal management that are on track to make a difference, big time?

Mark A. Abramson: There are many bright spots in government. We know many outstanding career civil servants and political appointees in government. Many are working hard to improve their organizations. We agree completely that leadership is crucial to transformation. Jonathan Breul will now provide two examples.

Jonathan D. Breul: Frank Ostroff's recent Harvard Business Review article about "change management" in government provides three very good examples. One is the Occupational Safety and Health Administration in the Department of Labor during the Clinton Administration. A second more recent example is the U.S. Special Forces in the Defense Department. A third example is the Government Accountability Office under the leadership of Comptroller General David Walker.

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Virginia: With new pay banding being implemented one BIG problem that will occur is how will civilians be able to transition between agencies to determine if they are qualified. These problems are going to explode as more agencies have their own pay systems where it will be almost impossible for career personnel to advance in the federal system from say DoD to an agency that still uses the GS system. My feeling is there will need to be an underlying job level metric to determine who is qualified similar to the GS system unless a new system is created on base pay level and base pay bands.

John M. Kamensky: With pay banding, transition between agencies will most probably be based on pay levels rather than rank. GAO went to pay banding 15 years ago and when staff transferred in or out of GAO, the goal was to equate the pay level and experience level of employees in the transition.

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Washington, D.C.: I have worked for HHS/ACF for the past 12 years. We have a terrible morale problem. I attribute the problem to several factors including more work that must be performed by fewer and fewer federal employees, little to no investment or respect by politicals in the federal workforce, and to be fair, little to no confidence by federal employees in the political leadership. Are these and other problems being addressed? Thank you.

Mark A. Abramson: Government is a very large place. Some agencies are working very well while others are not. I encourage all career civil servants to think hard about their current agency and whether they are in the "right place" for them. I would like to see more mobility between agencies for civil servants. I believe individuals need experience in more than one organization to give them a broader perspective on managing in government. So I would say that if one's agency is not living up to one's expectation, career civil servants to begin to seek out other agencies which appear to providing more supportive environments for their career civil servants.

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Washington, D.C.: Re "blame," in a previous response: Compared to the private sector, it appears that the government has trouble taking early action against those who use poor judgment, and that, in turn, calls into question the progress of your Six Trends. Right or Wrong here?

Mark A. Abramson: I would place more emphasis on putting the right people in place at the beginning. I do believe in holding people accountable and making personnel changes when needed. But the key -- and where I would put my emphasis -- is on getting the right people (both career and political appointees) in place at the beginning. Does that person's experience match the job requirements and what is needed to effectively perform the mission of that specific agency. More attention also needs to be placed to effectively using the excellent career civil service we now have in place. Many of those individuals could be moved around to better use their experience and capability where needed.

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Washington, D.C.: Do you have a (collective) opinion on the C-jobs of the government: chief financial officers, chief information officers, chief human capital officers, etc.? It appears from the VA's mishap with the missing laptop that these folks really don't have a seat at the table.

John M. Kamensky: A number of the C-suite positions are statutory. Theoretically, they have a "seat at the table," but their influence depends on a department's senior leadership and how much opportunity they have to focus on management. GAO has recommended a Chief Management Officer to coordinate and integrate the efforts of the various C-jobs, so the Secretary can focus on policy and his/her deputy can focus on management.

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Harrisburg, Pa.: I heard an economist in the Comptroller General's office offer a forecast that our country will have a shortage of about 60 million employees from what we should expect to maintain our economy. We are already beginning to see this shortfall in jobs held by teenagers (due to the less proportion of Americans being teenagers, who will soon be the future lower proportion in the entire workforce) and in health care professions (where shortages of people to fill the demand for jobs are evident). What are the forecasts for jobs in the public sector? What are the future employment needs within public sector, and are we producing enough graduates in the public sector fields?

Jonathan D. Breul: I don't have the data to forecast the need for jobs in the public sector, but the reality is that the challenges of today's complex society are such that individual agencies and programs cannot succeed in delivering results on their own any longer. The fundamental performance improvement challenge in government today is for leaders to achieve results by creating collaborative efforts that reach across agencies, across levels of government, and across the public, nonprofit and private sectors.

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McLean, Va.: It seems to me that current trends affecting government are declining morale in the civil service, a consistent inability of Congress to reform (and perform), and a rise in "non-governmental" organizations to meet needs that perhaps the Federal Government should be doing. Do you agree that these are trends, and, if so, what actions can be taken to move these trends to a positive direction?

Mark A. Abramson: These trends are clearly evident, but each is different. Morale can be changed and improved. Government can do a better job of articulating their exciting missions to their own employees. Many government agencies are doing highly important work for the future of the nation and are at the cutting-edge of their professions.

More activities will be performed by non-government organizations in the future, but government has the unique challenge of actively creating these networks and partnerships to accomplish national goals which no one organization can accomplish by themselves.

I believe Congress can do a better job. I recommend a new book out by Norm Ornstein and Tom Mann on the need for additional reforms in Congress to make it a more effective branch of government.

So all these trends will continue -- but we can clearly do a better job in responding to each one.

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Stephen Barr: I'm interested in your observations about the "trade offs" when pursuing transformation. I would venture that many federal employees endorse the notion, but are skeptical about their agency's ability to pull it off. In your paper, for example, you cite Howard Risher and Shelley Metzenbaum on the risks involved in the transition to performance pay.

Jonathan D. Breul: Good point. Richer, in fact points out that there is no textbook answer and that new pay for performance systems must "fit" the organization and its approach to management. He also warns that the transition to pay-for-performance is not going to be easy - suggesting it may well prove to be the most difficult change any organization has ever attempted!

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Patuxent River, Md.: How will the trends of Transforming Government impact the future of Civil Service retirement plans? Please better define the changes mentioned in Monday's column concerning civil service rules?

John M. Kamensky: The civil service rules described in Monday's column relate more to performance-based pay, pay-banding, and hiring flexibilities (such as eliminating the "rule of three"). The trends we see are attempts to update personnel processes, not change the values of the civil service system. One of our authors noted that a shift to performance-based pay is risky, especially if improperly designed or implemented. But the potential benefits of creating a greater focus on performance and results may be worth the risks. GAO says that the best approach is to phase in these initiatives over time, and revise systems if things aren't working as planned.

None of our work to date has direct implications for the federal retirement system.

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Stephen Barr: I also wanted to draw attention to your trend--"performing on demand." Many Diary readers believe that is the secret of the success enjoyed by the military and the Coast Guard. How would you define this trend for the non-military parts of the government?

Mark A. Abramson: There are many examples of "on demand" performance at the state and local levels of government. I can renew my drivers license in Virginia on-line anytime. There are many examples of such government "transactions" which can now be done "on line". We are seeing more and more examples. The Social Security Administration and the Internal Revenue Service has substantially improved their on line capability. IRS can tell you when you tax refund will be mailed to you. That is an excellent example of on demand. We believe more and more agencies will be demonstrating such capabilities in the years ahead.

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Bethesda, Md.: Certainly the federal workforce and its rules & regs could use improvement. I'm all for that. However, I certainly don't see Congress, or the House, or even the White House for that matter taking care of their responsibilities in a timely functional manner.

Isn't leadership supposed to be top-down to qualify as "leading"? Where's that 2007 budget, anyway?

Jonathan D. Breul: To be successful, management reform efforts must secure and maintain top level support throughout the White House and with the Office of Management and Budget. In the absence of strong leadership at the highest levels, management agendas will have limited impact. Indeed, a management initiative may well be counter-productive in the absence of support and unequivocal commitment at the level of senior White House and Cabinet officers.

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Washington, D.C.: Why 6 trends and not 10? Thanks.

Mark A. Abramson: We worked hard together brainstorming on these trends. We actually started out with four and then added two additional trends. We plan to constantly review these trends and update this report in the future.

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Washington, D.C.: It's hard for me to put any more faith in the much-vaunted "market system" than it is to put it into the government, particularly after the Enron (and all the other) debacle.

John M. Kamensky: "Market-Based" refers to an approach, not necessarily the ethics of an approach! Typically, an agency uses hierarchical approaches to delivering its mission services. But many challenges are cross agency and agencies are increasingly using networks and partnerships across agencies and sometimes across levels of government. However, when a challenge is complex and cannot be easily managed by any one agency or level of government, market-based tools are sometimes the most effective approach. For example, the VA's "market based" tool is the GI Bill. The government decided it wasn't effective to create a network of VA Universities. Likewise, states use a bottle deposit refund system to encourage people to return bottles rather than put them into the garbage stream.

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John M. Kamensky: Thanks for the opportunity to participate in this forum. It is exciting to see so many readers who are equally interested in the challenges facing government in the coming years. Another report you might find interesting is our report, "The Next Government of the United States" by Donal Kettl, which identifies several key management issues that the next President will face. It is available at IBM Center for the Business of Government.

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Jonathan D. Breul: Thanks Steve. The challenges facing government call for comprehensive and profound change. Those that play a waiting game, postponing these changes, will find their fiscal strength and programmatic effectiveness eroding.

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Mark A. Abramson: Thanks very much Steve for the opportunity to participate in this Forum. We look forward to continuing to track these trends, as well as future trends in government.

I want to echo's John suggestion that readers visit the Center's Web site, IBM Center for the Business of Government. We have published over 150 reports during the last eight years which are reflected in the development of six trends. Center publications can either be ordered online or by calling (202) 515-4504.

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