NYATEP Fall Conference October 2008 Strategic Operating Plans:  Integrating Performance Based Management Into One-Stop Center Expectations

Agenda Overview of NYC Workforce1 System Outcomes Based Contracting Strategic Operating Plan (SOP) Developing the process Communicating the exercise to Centers Working with Centers to achieve outcomes Linked to Annual Contract Evaluation In Depth Look: ITG Measurement Lessons Learned Questions

Overview of NYC Workforce1 System NYC Local Workforce Investment Area is the largest in the country Consists of the five boroughs of New York City New York City’s workforce system is overseen by the NYC WIB Direct services to adult jobseekers and businesses are managed by the NYC Department of Small Business Services NYC Department of Small Business Services oversees the operation of eight Workforce1 Career Centers (One-Stop) Seven different contracted service providers, both non-profit and for-profits All contracts are performance based and all Centers participate in an annual strategic planning process Business and data driven workforce development system Since April 2004 the system has placed New Yorkers in over 60,000 jobs, more than 4,000 in each of the past ten quarters

Overview of NYC Workforce1 System Workforce1 serves two customers with two brands: NYC Business Solutions helps businesses save time and money by providing employers with pre-screened, qualified job candidates and connecting businesses to training programs designed to improve workforce skills and reduce turnover. Six Business Solutions Centers provide a range of business services, including financing, MWBE certification, and business incentives. Workforce1 Career Centers (WF1CC) connect employers to a skilled workforce and provide training and placement services to the City’s adult jobseekers. WF1CCs provide the City's jobseekers with a full array of employment services including career advisement, skills training, and job placement. SBS operates these centers in coordination with the New York State Department of Labor and the City University of New York, combining the expertise of many different organizations to provide a seamless network of employment services and business development resources.

Outcomes Based Contracting Contracts are 70% line item reimbursement, 30% performance milestones Line Item budget reduces risk to providers and provides opportunity to increase performance goals each year Performance Milestones Total Job Placements Employer Fulfillment/ Account Management Teams General Retention After 6 Months Employer Specific Retention After 6 Months At least 30% of new customer registrations per month must be Dislocated Workers as a prerequisite for reimbursement Validation of Outcomes for Payment Performance outcomes are determined on a quarterly basis Outcomes are validated by third party research firm using telephone surveys of jobseekers The system is currently in Year 5 of 6 year contracts Milestones were completely changed after Year 3 and contracts were amended to reflect new milestones

Strategic Operating Plan (SOP) Overview Goal is to focus service delivery on job quality and exemplary customer engagement in addition to total volume of placements Clearly defined processes to achieve success Annual plan written by service providers to articulate strategy for the year ahead (July-June) Performance is reviewed and rated quarterly Currently there are five Strategic Objectives: Target Sectors Hiring (including New Location Openings and Account Management Teams) Business Solutions Centers Hiring Community Partners Training (including Individual Training Accounts) In 2006, the system had ramped up operations and infrastructure to achieve outcomes consistent with current averages Placements, however, were not strategic and SBS realized that there needed to be a focus on quality, not just quantity, and how placements are achieved Each Objective has approximately 5 sub metrics to measure specific qualitative and quantitative goals

Strategic Operating Plan (SOP) Annual Plan Development March & April: SBS program teams meet internally to evaluate objectives and determine performance priorities for coming year May: SBS develops Annual Plan Template, Annual Rating Guide & Rating Sheet, Quarterly Rating Guide & Rating Sheet June: Centers write and submit Annual Plan. SBS rates plans and meets with centers individually to discuss and revise July: New SOP Objectives are implemented by Centers Quarterly Performance Review & Rating Each Objective is worth 10 points; Each metric receives a “Did Not Meet”, “Met”, or “Exceeds”. Point distribution is based on total number of metrics SBS meets with each Center individually to discuss the past quarter’s performance and set goals for upcoming quarter Each Objective is managed by an SBS program team Annual Rating and Quarterly Ratings are combined and used to inform each provider’s contract evaluation The contract evaluation provides the leverage to ensure performance. If a provider receives a rating other than “Satisfactory” or better, they will have a difficult time winning future contracts with the City.

Strategic Operating Plan (SOP) Clear Communication and Ongoing Engagement with Centers Monthly and Quarterly Performance Reports issued by SBS Weekly Communication Newsletter e-mailed to all Centers Monthly and Quarterly Meetings with Centers Training and Hiring Objectives have Biweekly Conference Calls SOP Rating Guides clearly state expectations for rating scores for both qualitative and quantitative outcomes Ongoing technical assistance is available to Centers on particular processes and Objectives as needed Centers share a common database with each other and with SBS Transparency in data entry and reporting Consistent definition of goals and successes SBS meets with service providers as a group on a monthly and quarterly basis to discuss performance and operations, set expectations, and provide a forum for best practice sharing

Example: Training Objective Quantitative Metrics Issuance of the center’s Individual Training Account (ITA) allocation Actual vs Target Achievement of a 70% Adult/ 30% Dislocated Worker allocation of vouchers Effective integration of training into the center’s demand-driven strategy by ensuring ITAs are allocated towards Target Sector employers and Hiring Accounts Demonstration of a strong strategy for reengaging customers after training At least 50% of jobseekers must be placed in employment after training completion Demonstration that the Case Conference process was utilized to increase the number of jobseekers connected to occupational training via referrals to non-WIA funded training Referrals to free trainings = at least 50% of training fund allocation for quarter Achievement of enrollment and placement goals for the onsite GED/ESL classes Qualitative Metrics Effective utilization of the Case Conference model to help determine the strategic investment of training vouchers Achievement of goals for working with onsite and offsite Literacy partners

Example: Training Objective Implementation Development of System-wide process to evaluate ITA applications Biweekly Conference Calls with Center Career Advisors Weekly Training Voucher Issuance Report from SBS ITA Pipeline Report Issuance Report Pipeline Report

Lessons Learned Manage to the Objectives Control the Data Align payment milestones/ strategic objectives with key measures of success Ensure service providers have direct influence over metrics Limit number of metrics to lessen administrative burdens Understand how daily operations are impacted by metrics and goals Control the Data Define outcomes to best reflect objectives (Require outcomes that can be regularly reported) Record data consistently and timely Set up process to maintain data quality Understand how changes in technology, policy, and practice might affect data Common Data Points and Shared Database Allow Allows for tracking of performance over time and across the entire system Determination of where uniformity brings efficiency Sharing of best practices Performance Based Management is Labor Intensive Requires significant staff and technology resources for both SBS and providers All stakeholders must commit to process Performance Based Management done well allows for performance growth and accurate outcomes reporting

Questions Shanna Gumaer Assistant Commissioner Workforce1 Career Center System Performance NYC Department of Small Business Services 110 William Street, 8th Floor New York, NY 10038 sgumaer@sbs.nyc.gov www.nyc.gov/sbs www.nyc.gov/workforce1 Stephanie Martinez Policy Director NYC Workforce Investment Board smartinez@sbs.nyc.gov www.nyc.gov/wib