Government’s Performance Dilemma
Harvard’s Kennedy School offers a course: “Driving Government Performance”, that is described on the website as:
“Results, results, results.
That’s what citizens expect from their public executives … and they expect those results now.
The program curriculum focuses on goal setting, building operational capabilities, measuring results, and “motivating individuals and energizing teams.” That’s straight out of textbooks on management.
Some version of that strategy is reflected in the management of virtually every company and increasingly in the management of hospitals. But in successful organizations, additional elements not common in public agencies are integral to raising and sustaining performance levels. An overriding issue for public agencies is attracting and retaining Gen Z workers with requisite job knowledge and skills.
Pew Research makes it clear there is a shared consensus on the nation’s most important problems – the pandemic, health care costs, violent crime, racism, illegal immigration, education, economic recovery, infrastructure, etc. Government has a role to play in addressing each of the problems (assuming the parties can reach an agreement). However, the track record suggests public agencies have not been managed to make a difference; there has been little progress. In fact, with government’s older workforce and the wave of employee resignations affecting employers across the country, government’s readiness could deteriorate.
A few public employers are ready to tackle the problems but far too many are not. The evidence is clear: experts have been advocating goal setting and the use of metrics for more than three decades. There is extensive literature and lines of consultants anxious to offer advice but the problems are, if anything, seen as more serious today than even a decade ago.
There are issues beyond what the Kennedy course covers that in combination make it difficult to realize meaningful performance gains in the absence of reform. Change is needed. A quote often attributed to Einstein is relevant: “The definition of insanity is doing the same thing over and over again and expecting different results.”
It Starts With Leaders
One of the often ignored but most important differences is the role of elected officials. In business, CEOs are deeply involved in company management. In contrast, it’s rare to find an elected official at any level who has extensive experience managing in large organizations. Several Presidents served previously as governors which is valuable but that’s not the same as leading a corporation. More typically people run for public office because of an interest in public policy. Many were lawyers. That’s also true of appointees.
An exception was Bill Haslam, Tennessee’s governor from 2011 to 2019. He worked раrt-tіmе in hіѕ father’s company as a teenager and went on to become president. He left to work for Saks Fifth Avenue and was also on the board of a clothing company. In his tenure as governor, the state made significant economic gains. He also is credited with leading one of the most successful state reform initiatives.
At the federal level, the Government Accountability Agency (GAO), is a similar success story. From 1998 to 2008 it was led by David Walker who previously served as a partner and global managing director of Arthur Andersen and earlier at Coopers & Lybrand. While at GAO he led a number of transformational reforms within the GAO and in the government that were widely recognized.
Elected officials who do not have experience in management tend to focus on external, political concerns. Those like Haslam and Walker make internal management issues a higher priority.
An answer is adding a Chief Management Officer or Chief Operating Officer to the Cabinet, along with an executive in each agency responsible for strategic planning, goal setting and performance reporting throughout the year. They are responsible for keeping the head of their agency apprised of results to date along with any operating problems. They should meet prior to cabinet meetings to track performance.
Agency heads should be expected to report on progress meeting goals in cabinet meetings. Companies with multiple divisions or operating units hold similar meetings monthly. In meetings with one’s peers its natural to want to confirm one’s competence so there is pressure to show progress in achieving goals.
The Two Worlds of Performance Management
Strategic planning, performance goals, and metrics have been part of the government world for years. Today’s uncertain environment highlights the need for agility: the economy, the political differences, and events like the COVID-19 crisis make it clear that goals are subject to unexpected change. Organizations, public and private, need to be ready to respond quickly to unexpected events.
Actually, that’s not new; it’s just more obvious today. One difference, and it’s a thread that affects many organizations, is that unexpected events could threaten lives.
Corporations were first prompted to become more responsive to events by the 1990 recession. To cut costs and become more responsive, many began to delayer — eliminating layers of management. It reduced the time for decisions to rise through the levels of management. They recognized they were too bureaucratic.
They also delegated decision-making on local issues to lower levels of management. That rides on trust and a willingness to live with mistakes. (The cost of mistakes at the lowest levels is generally low.)
Delayering triggered an expanded ‘span of control’ – the number of employees reporting to a supervisor – which open the door to increased autonomy and empowerment. Today, in larger companies with national or international operations, it’s common to find employees who rarely meet with their ‘boss’. Technology makes it possible to monitor performance from a distance.
Government is different in another significant way – it’s common in agencies to find two distinct approaches to performance management. At the highest levels, strategy, mission statements, goals, and metrics are the focus; at the front line level, year-end generic, ‘check the boxes’ appraisal forms are the norm. Each has its own literature, research studies, and experts. There is minimal overlap. In a real sense employee performance is unrelated to agency management.
The federal model goes back decades and for better or worse is reflected in state and local practices. Laws like the 1993 Government Performance and Results Act (GPRA) and the follow-up GPRA Modernization Act of 2010 were at the time seen as best practice.
The laws are combined with the long history of civil service and the continuation of regulations and practices that are more than a half-century old. In the first half of the 20th-century industrial engineers defined performance standards. Employees were told what to do – expected output was quantified. And that shifts the focus to what is minimally accepted performance.
Meeting standardized expectations is still common in federal policies. The federal focus continues to be on those who fail – the “poor performers”. Outstanding performance gets lip service but has little impact on the way employees are managed. Focusing attention on the best performers creates a work environment where achievements and success are celebrated; the best performers are rewarded.
A House committee used the word “revitalizing” in the title of a hearing on needed actions “to repair, rebuild, and fortify it for the future.” Significantly, among those called to testify, only Jim Sherk, Trump’s labor policy adviser, discussed performance and his focus was dealing with poor performers.
Rebuilding the federal workforce starting in 2020 has been a topic of congressional hearings, panel discussions, podcasts, and Washington area TV shows. The Biden White House has released several Executive Orders and Memorandum focused on strengthening the workforce.
A recent National Academy of Public Administration (NAPA) paper includes three recommendations focused on adding talent: Building interest in public service, shifting to more flexible pay and job classification, and reforming the hiring process. The working group also recommended: Improving the quality of managers and supervisors and identifying talent management as a presidential priority.
But aside from “the quality of managers” the many reports have been largely silent on two issues that are continually a focus of initiatives in the private sector. First are the workplace attributes highlighted in the research on high-performance organizations and the Great Places to Work – open communications, trust, collaborative working relationships, etc. Second, the only reference to “performance” in the NAPA paper is in the statement “promotion rules that value longevity over expertise and performance.”
NAPA has produced several reports that focus on the management of performance. One that stands out is, Strengthening Organizational Health and Performance in Government. However, in their reports, the management of agency performance and employee performance is treated as unconnected problems. That divide is reflected in the federal government by the very separate roles of OMB and OPM.
Research as well as our personal experience as parents tells us desired new behaviors are more likely to succeed when change is reinforced.
Investing in Managers
There was a time in the distant past era when the job of ‘manager’ was relatively simple. They told subordinates what to do and made sure they did it. Seniority was the basis for naming new supervisors. Manager training was limited, focused on company policies and the requirements of laws like the Fair Labor Standards Act. It’s been said that the practice means the organization loses a good technician or craft worker and gets a poor supervisor.
In the years after World War II, pent-up consumer demand fueled exceptionally strong economic growth. With the rapid growth, large organizations emerged; owners/managers were replaced by a cadre of professional executives trained in business schools. Growth continued, with brief downturns, to the 1990 recession. In the decade, personal computers and cell phones came into common use, enabling managers to monitor results from a distance. Knowledge jobs emerged. The pandemic and working remotely is the latest development. The changes in the work management paradigm have been revolutionary.
Two decades ago, Gallup started promoting the importance of employee engagement and its impact on performance. While Gallup has gotten the attention, a number of researchers have confirmed the linkage between employee engagement and their performance.
Their research also confirmed the old adage, “people quit their bosses, not their jobs.” In government a dissatisfied employee may be reluctant to quit – walking away from accrued benefits is costly – but they can and sometimes do resign on the job. That’s actually more costly than a resignation since their discontent affects other employees.
Gallup’s studies show managers and their approach to supervision account for 70% of the variance in employee engagement. Their analyses show the level of engagement is correlated with several performance metrics – absenteeism, turnover, accidents, mistakes, etc — associated with operating costs. To quote from a recent Gallup post, “In nearly every dimension of business success, the manager makes the difference. From diversity and inclusion to productivity and retention, the manager plays a singular role in the life of an employee” and is the single most influential factor in their performance.
That post, ‘8 Behaviors of the World’s Best Managers”, focuses on what managers should do to develop highly engaged work teams.
It needs to be emphasized that raising performance levels requires change. It’s the Einstein quote. Investing in managers to develop the supervisory practices associated with high performance will pay off with better results.
All the evidence suggests far too many government managers rely on an approach to supervision that is not appreciably different than it was decades ago. Unless there is a reason to change, managers perpetuate the supervisor style learned through their experience. Evidence from other sectors makes it very clear performance cannot be improved as long as the work experience and the approach to supervision are unchanged. That’s the key to improving performance.
It’s likely the optimal supervisory practices vary from agency to agency. There are to be sure common cultural characteristics across all levels of government but effective supervision in agencies as diverse as a prison system, a banking department, and a public health department have to require somewhat different supervisory behaviors. An analytics study based on employee survey responses would identify the differences. Analytics could also identify clusters or archetypes of manager styles.
Then agencies would have the information to develop manager training programs, develop more focused appraisal instruments, and use coaches to work with managers needing improvement. Coaches played an important role in Tennessee’s reform.
Research, as well as our personal experience as parents, tells us desired new behaviors are more likely to succeed when change is reinforced. The promise of rewards for success is deeply entrenched in other sectors. Pay for performance for managers is effectively universal. That is a proven strategy to improve results. Moving to a pay-for-performance policy for managers was important in Tennessee.
To reiterate, when the goal is to improve performance, change is essential. Unfortunately, resistance to change is natural, especially when it could affect ones status or sense of security. That’s especially true for older workers. Many public employers have the added barrier – unions where leaders look to older workers for support.
The dilemma is that young, Gen Z workers look for a very different work environment. (See, for example, the Gallup column, “4 Things Gen Z and Millennials Expect From Their Workplace”.) Realistically, the management philosophy common for decades is quite different and needs to change.
An Additional Step: Replace Traditional Job Descriptions
Public employers have files of hard copy documenting jobs and assigned tasks that would require yards of shelf space. There was a time not too many years ago when personnel offices had specialists who focused on developing job descriptions and classifying jobs. Then jobs were more or less static for years. Today that’s a cost that’s hard to justify. The pandemic made that all too apparent.
Today the work environment is rarely static. Ever-changing circumstances mean jobs and performance expectations need to be reconsidered as the year unfolds. The rapid shift to working remotely highlights the need to be ready for change. In business, the focus in planning is improving results so it’s much more common for managers and their people to discuss how external developments affect goals and expectations.
Assuming agencies want to improve performance – that’s discussed in reports but not supported by the evidence — it would be far more productive to shift to the widely used goal-based management, with managers and their people discussing and agreeing on expected accomplishments. Employees work at their best when they are empowered and know what they need to accomplish.
When someone is asked about their job, they can describe what they do in a minute or two. Similar brief descriptions are used in salary surveys. Traditional job descriptions can take weeks and months to be approved, especially with multiple incumbent jobs. The practice is hard to justify.
Descriptions should include a statement summarizing how the incumbent contributes to team, unit, or agency success, metrics relevant to evaluating performance, the knowledge and competencies associated with good performance, career paths, reporting relationships, and working relationships with co-workers and other units. That information is relevant to all stages of talent management.
The Goal: Creating a Performance Culture
Business planning focuses on growth and profitability. Those cascading goals depicted in textbooks always end with the bottom line. Managers and employees can see how their efforts contribute. Competition also feeds the shared commitment to achieving goals. Management incentive plans link everyone to company performance. At lower levels, team incentives do the same thing.
In the past, it was argued that “it’s the paycheck that counts”. Today of course millions of employees are resigning. That makes it clear today’s employees want something more.
Government should have an advantage. A McKinsey podcast from June, “The Search for Purpose at Work”, captured the value of a job that provides “a sense of direction, intention, and understanding that the contribution you’re making is going somewhere reason for going to a job each day.” From the transcript, purpose “usually speaks to higher values or a higher mission.” That describes government service.
Agency performance goals and metrics have been used in agency management for roughly three decades. A 2004 GAO report made a key point, “GPRA Has Established a Solid Foundation for Achieving Greater Results”. Metrics enable everyone to monitor progress. Metrics can also be used to compare progress across agencies. But the data needs to be shared; leaders need to emphasize the goal of realizing gains. When linked to an agency’s “purpose”, it feeds employee desire to contribute. Then cascading goals can work for government.
However, a key point in the GAO report is that managers agreed they are “accountable”, but a significantly lower percentage agreed they have the “decision-making authority needed to help the agency accomplish its strategic goals.” Moreover, fewer than half “reported receiving relevant training” or a “positive recognition for helping agencies achieve results.” That needs to change.
That reality represents one of the most important differences when government practices are compared with ‘best practices’ in the private sector. Empowering managers is basic. They are the often overlooked keys. Tennessee proved investing in managers pays off. Add to that occasions to recognize team and individual accomplishments and agencies should realize significant performance gains. Everyone wins.
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