Reformation can be expensive, especially when the object of reform is the world's largest nonprofit organization, the U.S. government. To date reform-mined federal officials have promised or paid out more than $14 million to outside experts. In return they have been promised advice, diagrams and systems that will enable them to tell which government executives and supervisors are good or bad, and once rated, what to do about them.
The flood of hiring management consultant firms flows from the Civil Service Reform Act. It is President Carter's plan to make the federal bureaucracy more efficient, responsive and businesslike by introducing industry-style systems and practices such as rewards, bonuses, pay differentials and pay "disincentives" (lower-than-normal raises), depending on a worker's report card.
The reform law calls for merit pay (rather than automatic annual raises) for thousands of Grade 13 to 15 supervisors and managers (who are paid from $29,375 to $50,112.50), and a new system of hiring, using and rewarding top executives in the Seniro Executive Service. The SES includes most federal officials formerly in the top three grades, Gs16, 17 and 18.
Anxious to get impartial opinions, federal agencies have been turning to outside consultant firms. So far, agencies and departments have spent or allocated $14.10 million for services -- ranging form big firms to college professors -- to tell them how to set up training systems for SES members of implement merit pay and performance standards. Many departments and agencies are paying the same firms two, three or four times for the same advice. Oficials explain, however, that rather than duplication, this is to provide specific programs for agencies within the same department.
Contracts range from gigantic to tiny. For instance:
Navy has given a multimillion-dollar contract to Coopers and Lybrand to develop a merit pay system and provide training to about 22,000 of its workers. Navy has approved a separate, $1.25 million contract with the same firm on an SES performance and appraisal system.
Air Force has given three contracts ($263,000; $240,000 an $77,255) to help implement civil service reform. It has also contracted for $113,228, according to Sen. David Pryor (D-Ark.), with Applied Sciences Inc. for a job performance and promotion appraisal training system. Pryor heads the Senate civil service subcommittee that is questioning the dollar amounts and wisdom of contracts to outside firms when the government itself has 2.8 million highly trained employes.
Army will pay Organization Resource Counselors an estimated $10,000 to review drafts of SES plans and tell it what other agencies -- like the Navy and Air Force -- and industry do with their executives.
The Offices of the Secretary of Defense has also contracted with a firm to help it set up an SES training program, like Army, Navy and Air Force.
The Securities and Exchange Commission is paying Towers, Perrin, Forsters and Crosby $16,000 for SES development and another $16,000 for merit pay help . . . Federal Trade Commission is paying another firm $26,000 for the same SES advice, and another group $75,000 for an executive development program for the SES "and feeder group."
Small Business Administration has agreed to pay Coopers and Lybrand $270,000 to design a merit-pay training system for managers.
Health, Education and Welfare paid three individuals, called "key consultants," $134,000 to design a National Institutes of Health performance planning system. It said "tight deadlines" forced it to go outside rather than rely on in-house expertise.
Defenders of the system say the contracts are monitored carefully and should result in significant savings n future through better management. They say that what appears to be duplication of effort is not, since the Office of Personnel Management and the Reform Act Encourage agencies to tailor programs to their specific needs.
"You can't just make Xerox copies of one of these reports for one department and pass them out to others," an official explained.