A thread running through the Project 2025 report is that the government needs to improve performance.  A search of the report found the word ‘performance’ appears 87 times.  ‘Accountability’ appears 113 times (‘Accountable’ is another 77.).  Effective management of performance is the core issue in the early chapter: “Central Personnel Agencies: Managing the Bureaucracy”.

President-elect Trump disavowed Project 2025, but now he’s filling key positions with authors of the report.  Russell Vought was most notable, nominated as the Director of the Office of Management and Budget.  In a recent column, The Wall Street Journal focused on an issue that follows from the Project 2025 report:

“The civil service certainly needs an overhaul—as former Federal Reserve Chairman Paul Volcker argued for decades—to establish accountability from top to bottom. The point, however, isn’t to inject a sense of terror in government employees but to instill trust that everyone is held to the same standards. Near-zero accountability is like pouring acid over public culture, eroding trust and pride.”

There have been calls for government reform as far back as Truman.  Reagan sought to “drain the swamp” when he created the Grace Commission, composed of more than 150 business executives.  The Clinton/Gore “Reinventing Government” was intended to “make government cool again.”  Obama’s Simpson-Bowles Commission also focused on making government more efficient.  Both sides agree government needs to change but today’s divided government is a high barrier.

The New Management Model of the 90s

The federal government took a step as far back as 1993 to reinforce agency accountability with passage of the Government Performance and Results Act (GPRA), requiring agencies to adopt the widely used business practices – setting goals, measuring results, and reporting progress.  Obama “modernized” the required practice in 2010 with legislation that created a “more defined performance framework”.  The subject has been a recurring subject on the President’s Management Agenda.

Despite the laws and White House commitment, it’s now three decades since the passage of GPRA, and writers continue to discuss the problems the law was intended to address.  The website GovExec frequently has columns focused on performance.  One of the most recent posts in October highlights a key omission from the legislation, “Holding poor performers accountable can lead to better government.”  As if the few poor performers are responsible for the public’s dissatisfaction with the government.

Businesses once had similar problems. However, the Total Quality Management movement in the 1980s prompted new attention to frontline workers and their role in “continuous improvement.” That was followed by the 1990/91 recession and the elimination of layers of management to cut costs. ‘Knowledge workers’ became a popular new phrase. ‘Reengineering’ became a buzzword.  Delayering meant managers had more employees to supervise, triggering the transition to goal setting. Together, the changes became a new model for workforce management. However, civil service systems remained rigid and unchanged in the public sector.

Today, accountability means “making each employee accountable for the success or failure of the expected contribution to the work effort.”  With effective leadership, “. . . employees are not just accountable for their tasks but are motivated to exceed expectations, contributing to a high-performing team . . .”  “. . . a culture of accountability serves as the thread that holds everything together.”

In the business literature, the word ‘accountability’ or ‘accountable’ is rarely found in performance management discussions.  Those concepts are deeply entrenched and effectively taken for granted in the thinking and practices of every successful business.

The Missing Element

The common government practices are silent on a virtually universal practice that reinforces goal achievement.  It’s the use of financial incentives that link organizational performance to the compensation of executives and managers. They are rewarded as a “team” for the organization’s success. Similar incentive plans are often used with teams at lower levels. That reinforces accountability.

The difference is apparent in the columns on websites like the Center for Accountability and Performance. Discussions of using goals and metrics appear frequently, but it’s rare to find statements suggesting individual or team accountability.

No company focuses only on individual performance.  Except for sales commissions, the incentives at all levels are tied with metrics to company, division or team performance.  Metrics-based group incentives are virtually universal in business.  There are added payroll costs but those are more than offset by better results, including improved efficiency.

Profit sharing was used in France for roughly two centuries. It’s still used widely by smaller companies, frequently to fund retirement benefits. Gainsharing, based on cost savings, was conceived by a union leader in the 1930s. Its use in government to reduce costs was discussed in the 2016 book Peak Performance, the story of Denver’s Peak Academy and how small teams of city workers saved millions.

Interest in rewarding performance goes back decades. At the federal level, the first real change was the passage of the Civil Service Reform Act of 1978. The law created the Senior Executive Service, providing cash awards to the best performers as high as $20,000. The law also created a true “merit pay” system for managers and supervisors, but the design was flawed, and the policy was terminated 40 years ago.

Merit salary increase systems exist in several federal agencies and a number of state governments, but the differences make them hard to compare. There are many critics, but surprisingly, there has been no initiative to document ‘best’ practices. There have been no studies on the linkage between pay policies and performance. It’s as if worker performance is unrelated to agency performance.