THOUGHTS ABOUT THE FUTURE John Pickering Commonwealth Centers FOR HIGH-PERFORMANCE ORGANIZATIONS www.highperformanceorg.com THOUGHTS ABOUT THE FUTURE John Pickering and Center for Executive Leadership THE FEDERAL EXECUTIVE INSTITUTE THE WELDON COOPER CENTER FOR PUBLIC SERVICE University of Virginia FOURTH HIGH-PERFORMANCE CHANGE CONFERENCE March 2-4, 2004 Charleston, SC

THANKS PHIL, JOAN, and KEITH! BERNIE EVERYONE FOR ATTENDING

REFLECTIONS ON THE JOURNEY

TWO “QUOTES OF THE CONFERENCE” “Organization years are like dog years; 7 human years = 1 organization year” “Only three things in organizations happen naturally: friction, confusion, and under-performance. Everything else requires Leadership.” Peter Drucker

TWO THOUGHTS FOR THE FUTURE THE “NATURE OF WORK,” THE NETWORKED TALENT MODEL, AND INDIVIDUAL JOB PERFORMANCE GOVERNMENT AND “THINKING LIKE A BUSINESS”

TWO THOUGHTS FOR THE FUTURE THE “NATURE OF WORK,” THE NETWORKED TALENT MODEL, AND INDIVIDUAL JOB PERFORMANCE GOVERNMENT AND “THINKING LIKE A BUSINESS”

A QUICK REVIEW OF CONCEPTS

BUILDING HIGH-PERFORMANCE THE TWENTY-FIRST CENTURY Commonwealth Centers FOR HIGH-PERFORMANCE ORGANIZATIONS www.highperformanceorg.com MODULE I: SETTING THE CONTEXT--THE EVOLUTION OF “THE NATURE OF WORK” BUILDING HIGH-PERFORMANCE ORGANIZATIONS IN THE TWENTY-FIRST CENTURY

The Evolution of “THE NATURE OF WORK” INDUSTRIAL ENGINEERS “SCIENTIFIC MANAGERS” 1900 L OWNERS EXECUTIVES Upper Class INDUSTRIAL PHASE M M M MANAGERS FOREMEN Division of Labor Vertical Horizontal T T T T T 2B LABOR Working Class

The Evolution of “THE NATURE OF WORK” Leadership Team 2000 NETWORKED TALENT MODEL M L TS T M L M L TS TS T T M L M L TS TS T T Management Team Task Team

“WORK” IS HOLISTIC IN THE NETWORKED TALENT MODEL The Evolution of “THE NATURE OF WORK” “WORK” IS HOLISTIC IN THE NETWORKED TALENT MODEL Management Skills, Abilities, and Behaviors Causal Modeling/Systems Analysis Performance Planning Project Management and Execution People Development Plan Implementation, Monitoring, and Adjustment Outcome/Results Variance Analysis Open Communication Leadership Skills, Abilities, and Behaviors Strategic Customer Value Analysis Vision/Values to Strategy/ Structure/Systems Suprasystems Integration/ Stewardship Learning/Thinking/Changing/ Renewing Enabling/Empowering/ Energizing M L TS T Task/Technical Skills, Abilities, and Behaviors continuously broaden and deepen task/ technical skills and abilities Team Skills, Abilities, and Behaviors see slide I-9 for these skills

Compensation Based On “Value” TS T M L Journey-Level Position TS Value to the Organization T M L TS T T M L TS Entry-Level Position T Entry Filter X Time in the Organization X X X

INDIVIDUAL PERFORMANCE LINKED TO ORGANIZATIONAL PERFORMANCE Personal (Individual) Focus Team (Interpersonal) Focus Network (Microbusiness) Focus TEAM/ NETWORK PERFORMANCE UNDER CONTROL (e.g., Project Management) INDIVIDUAL DELIVERS COMPETENCIES & BEHAVIORS TO TEAM/ NETWORK INDIVIDUAL COMPETENCIES + VALUES/ BEHAVIORS + +

INDIVIDUAL PERFORMANCE LINKED TO ORGANIZATIONAL PERFORMANCE Personal (Individual) Focus Team (Interpersonal) Focus Network (Microbusiness) Focus TEAM/ NETWORK PERFORMANCE UNDER CONTROL (e.g., Project Management) INDIVIDUAL DELIVERS COMPETENCIES & BEHAVIORS TO TEAM/ NETWORK INDIVIDUAL COMPETENCIES + VALUES/ BEHAVIORS + + Base Pay (90%) Variable Pay (5%) (5%)

TWO CRITICAL WORKFORCE TRENDS RANDOM OBSERVATION: TWO CRITICAL WORKFORCE TRENDS INCREASING CONTRACTOR PERCENTAGE; DECREASING GOVERNMENT EMPLOYEE PER-CENTAGE – GET GOOD AT INTEGRATING CONTRACTOR/PUBLIC WORKFORCES THE MOVE FROM TASK BASED JOBS TO COMPETENCY BASED JOBS, AND THE MOVE FROM RANK-IN-JOB TO RANK-IN-PERSON – GET READY FOR PAY BANDING

TWO THOUGHTS FOR THE FUTURE THE “NATURE OF WORK,” THE NETWORKED TALENT MODEL, AND INDIVIDUAL JOB PERFORMANCE GOVERNMENT AND “THINKING LIKE A BUSINESS”

BALANCED SCORECARD EXAMPLE FROM SOUTHWEST AIRLINES SM-49a BALANCED SCORECARD EXAMPLE FROM SOUTHWEST AIRLINES Objectives Measures Goals Strategies Profitability Market Value 30 % CAGR * Increased Revenue Seat Revenue 20 % CAGR Plane Lease Cost 5 % CAGR Lower Costs FAA On Time Arrival Rating No. 1 Quality Management On-time flights Lowest Prices Customer Ranking (Market Survey) No. 1 Customer Loyalty Program Learning Internal Customer Financial Time on Ground 30 Minutes Cycle Time Optimization Fast Ground Turnaround % On Time Departure 90 % Program % Ground Crew Shareholders Employee Stock Option Plan Year 1: 70% Year 3: 90% Ground Crew Alignment with Company Goals % Ground Crew Trained Ground Crew Training Year 5: 100% * CAGR = Compound Annual Growth Rate

SSC San Diego Strategy Map Integrated Products & Services SM-50 To Be the Nation’s Pre-eminent Provider of Integrated C4ISR Solutions for Warrior Information Dominance Innovation Integrated Products & Services Execution Excellence Customer, Buyer & Stakeholder (C 1) Develop Innovative Capabilities (C 2) Deliver Quality Products & Services (C 3) Provide Fully Supported Products (C 4) Provide Affordable Solutions (C 5) Deliver On Time & Within Budget (F 1) Invest in Future Capacity (F 2) Manage Cost of Operations (F 3) Maintain Financial Health Financial (I 5) Improve Strategic Outreach (I 1) Develop Innovative Solutions (I 2) Transition Technology Into Capabilities (I 4) Build Trusted Relationships (I 6) Team Across Technical, Support & Administrative Functions Internal (I 3) Shape the Business (I 7) Standardize Technical Work Processes (I 8) Improve Financial & Administrative Processes Learning & Growth (L 1) Ensure a Workforce with Critical Skills (L 2) Share Corporate Information (L 3) Align to Shared Vision & Values (L 4) Cultivate an Enriching Work Environment V. 5 25 June 2002

EPA – Office of Inspector General SM-51 Measuring the Office of Inspector General’s Performance GOAL 3: Produce timely, quality and cost effective products and services that meet customer needs GOAL 4: Enhance diversity, innovation, teamwork and competencies GOAL 2: Improve EPA’s management and program operations Resources Activities/Program Outputs Customers Short-term Behavioral Outcomes Intermediate Behavioral and Organizational Long-term Environmental Ecosystem and Human Health Improved and Natural Environment and Human Health Improvements • Changes Deterred Crimes Better Systems and Processes Employees Contracts Technology Travel Training Audits Evaluations Investigations Special Studies Consulting Services Legislative/ GOAL 1: Contribute to improved GOAL 1: Contribute to improved environmental quality and human health environmental quality and human health • Audits • • Reports Reports • • Congress Congress • • Increased Increased • Evaluations • • Briefings Briefings • • EPA EPA • • OMB OMB Knowledge Knowledge • Investigations • • Civil Actions Civil Actions • • Changes in Changes in • Special Studies • • Criminal Actions Criminal Actions • • Other Other Attitude Attitude • Consulting • • Administrative Administrative Federal, Federal, Services Actions Actions State, Local State, Local • • Improved Skills Improved Skills • • Aspirations to Aspirations to • Legislative/ Agencies Agencies • • Private Private Improve EPA/ Improve EPA/ Regulatory Regulatory Environment Environment Reviews Reviews Sector Sector • • Public Public - Legislative changes - Risks reduced or - Risks reduced or - Regulatory changes eliminated eliminated - EPA policy or directive - Examples of - Examples of changes environmental environmental - Risks identified improvements improvements - Best practices identified - # and % of performance measures affected - # of best practices transferred - Questioned costs - Time saved (cycle time) - Costs avoided or saved - Recommended - % of recommendations % improvement in GPRA efficiencies implemented rating - Criminal/ civil/ - Best practices - Time to resolve administrative actions implemented - examples of management challenges - Best practices identified process/ practice changes - % satisfaction with EPA -Fines/recoveries and service quality restitutions - # of collaborative - # of contacts with - % of OIG work requested efforts, states/feds congressional staff - % customer satisfaction - Cost and time per ratings assignment - % of cases/ recommendations accepted - % of engagement letter expectations met - % positive image rating - # of requests to testify OIG LOGIC MODEL - % of staff meeting - % of work - % of products available training standards completed by multi- electronically - % of staff in parity disciplinary teams with civilian workforce - % of work - # of awards for performed creativity, innovation electronically and teamwork - # of innovative - % staff satisfaction techniques/processes on internal surveys and % implemented