1. Building a High Performance Government The Obama Administration’s Performance Management Approach Building a High Performance Government: The Obama Administration’s Performance Management Approach Dustin Brown International Consortium on Government Financial Management Wednesday, April 4, 2012

2. Where are we Headed? Government That Works “We shouldn’t just give our people a government that’s more affordable. We should given them a government that’s more competent and more efficient. We can’t win the future with a government of the past.” President Barack Obama State of the Union Address, January 25, 2011 “The test of a performance management system is whether it's actually used…. Federal managers and employees at all levels must use performance goals and measures to set priorities, monitor progress, and diagnose problems.” Chief Performance Officer Jeff Zients October 29, 2009 2

3. Lessons Learned from Past Efforts Government Performance and Results Act (1993 - present) 3 Program Assessment Rating Tool (2003 - 2008) Past government-wide efforts helped set goals and report results, but fell short of establishing lasting, effective management practices and became compliance activities with little senior or program engagement 38%56% 40%64% +__ Stable performance planning and reporting framework Performance focus --__ Lack of leadership involvement No focus on prioritization or management Focus on creating plans/reports 38%56% +__ Program focused Challenging questions on program effectiveness/mgmt Improved outcome measurement __--__ Not used by Congress to allocate funds Not used by agencies Reinforced stovepipes

4. Public Sector Lags in Performance Management Practices 4 2007 GAO survey found that while managers reported the supply of performance information has gone up over time, “the use of performance information in management decision making has not changed in the last 10 years” and had declined in several areas. 38%56% 40%64%

5. Public Views on Importance of Results Focus * By 62% to 36%, people said their priority is making government more efficient and more effective, not reducing its size 44% of Americans rate government’s ability to meet its goals as not so good or poor, but 61% say satisfied with own personal interactions with Federal programs. Having agencies set clear goals that are measured by real-world results (68%) was top-ranked specific proposal, followed by improving the budget process. * Center for American Progress/Hart Survey from July 2010 5

6. Over the last decade, there have been several efforts to apply leadership and data-driven performance management principles to government: Local governments began implementing data-driven reviews following successful “COMPSTAT” effort led by NYC Police Commissioner Bill Bratton that was credited with contributing to NYC crime reduction in late 1990s. Several other cities and now states have used techniques for targeted Governor/Mayoral led measurement and systematic reviews through “STAT” programs that covered all government operations. Governor O’Malley has implemented both a StateStat effort as well as a Delivery Unit program for Maryland First and best know central government effort is UK’s Prime Minister’s Delivery Unit, started by Tony Blair during his second term Australia and Canada have implemented similar programs with approximately a 40-50 person central performance teams 6 Leading State/Local and Foreign Government Practices

7. Example of Homeless Housed Resulting from DC CAPSTAT Efforts 7 CAPSTAT meetings

8. Transition to Obama Administration Opportunity to adopt latest practices from State, local, international examples into government-wide efforts But, need to tailor performance improvement framework to characteristics of U.S. Federal government Need to move beyond government-wide performance improvement efforts that led to compliance instead of establishing useful, lasting management practices 8

9. Past Legislation created a foundation But ….. the true test of a management system is Is it used? 9

10. Senior agency leaders typically focus on communications, budget, legislation —not results To achieve the Administration’s goals, we need to focus leaders on driving focus on results through to completion 10

11. How Will We Get There? Performance Management Strategies that Make Government Work Better 1.Leaders Set Clear Goals 2.Frequent Measurement and Analysis 3.Data-Driven Reviews Led by Senior Officials 11

12. Agency Priority Goal Approach 12 ObjectivesHow? Senior Leadership EngagementAgency Heads define “Priority Goals” to get ownership and ongoing engagement AccountabilityNear-term goals over 18-24 months aligned with tenure of senior leaders; Goal Leaders clearly named Focus on ImplementationGoals should be achievable within current legislation and budget Frequent Performance ReviewsMeasures/milestones with quarterly updates to identify improvement actions Prioritized Follow UpSurveys of Goal Leaders and OMB on likelihood of goal achievement TransparencyProgress made available on central web site – performance.gov

13. Overview of Agency Priority Goal Process 13 Engage Agency Heads Identify Goal Leaders Action Plans Quarterly Updates Senior Goal Leader Goal Lieutenant Quarterly Targets Quarterly Milestones Data-Driven Performance Reviews Agency Reviews OMB Reviews based on: Quarterly Data, OMB surveys, Goal Leader surveys on likelihood of success Public Updates on Site Quarterly Progress Updates on Priority Goals reported on web site 3-8 set by agency heads Ambitious, Meaningful Measurable Within Current Budget/Legislati on Identify problems Strategy Measures Milestones Contributing Programs Management Review Processes

14. Example Agency Priority Goals By September 30 2013, in partnership with the VA, reduce the number of homeless Veterans to 35,000 by serving 35,500 additional homeless veterans. By September 30, 2013, the U.S. Department of Agriculture (USDA) will expand U.S. agricultural exports to at least $150 billion to assist rural communities to build and maintain prosperity through increased agricultural exports. Increase use of our online services. By the end of FY 2013, we will increase our online filing rates from 36 percent at the end of FY 2011 to 48 percent. By December 31, 2013, reduce annual adults’ cigarette consumption in the United States from 1,281 cigarettes per capita to 1,062 cigarettes per capita, which represents a 17.1% decrease from the 2010 baseline. 14

15. Communicate progress through data-driven reviews Data-driven discussion on progress with quarterly survey of Goal Leaders and OMB on: – Likelihood of goal achievement? – Confidence in that assessment? – Which actions would most improve performance? – Promising practices identified? – Were targets/milestones for this quarter met? Use “Bill Bratton accountability principle” across the Federal government: – “No one got in trouble if the crime rate went up. They got in trouble if they did not know why it had gone up and did not have a plan to address it.” 15

16. Initial Results Agency Leaders are engaged in communicating priorities through measurable goals. – Agency heads and deputy secretaries/COOs personally engaged in setting their Priority Goals (instead of delegating performance issues) Agency Leaders are conducting frequent data-driven reviews of progress (instead of just compliance with OMB) – Agency COOs personally leading at least quarterly reviews Roles and responsibilities of performance leaders clarified (instead of new reporting requirements) – PIOs elevated and “Goal Leaders” defined to lead across organizations On-the-ground results and efficiencies realized (instead of “inside the beltway” effort) – Reduced violent crime, increased renewable energy, reduced improper payments 16

17. Safe Indian Communities Priority Goal Number of Violent Crime Incidents in Rocky Boy, Mescalero, Standing Rock, and Wind River Indian Reservations Beginning of FY ’10 Priority Goal initiative, October 2009 Average number of reported incidents for years‘07,’08,’09

18. Department of Interior Safe Indian Communities Priority Goal Initiative Department of Interior Safe Indian Communities Priority Goal Initiative In February 2009 Secretary of Interior set a goal to reduce violent crime by 5%. As of September 30, 2011, violent crime Incidents decreased overall by 35% in four Reservations. Priority Goal implementation begins 3 year average FY ‘07.’08,’09 - 68% - 40% - 27%7%7% Mescalero, New Mexico

19. Department of the Interior Renewable Energy Development Priority Goal Initiative Megawatt s Interior Secretary Kenneth Salazar led the Administration’s effort to develop new renewable solar, wind, and geothermal energy resources on public lands managed by the Bureau of Land Management. BLM approved projects generating 6,055 megawatts of new energy, enough to power 2.4 million homes. Though the 9,000 MW goal was not met, Interior’s progress toward this goal and its accomplishments to date have been historic.

20. Treasury Department Goal Decrease the Number of Paper Transactions with the Public Millions Actual Number of Paper Benefit Payments Issued Impact and Benefits Expected savings over five years: eliminated 835 million paper based transactions, $ 500 million in costs, 12 million pounds of paper, decrease improper payments and errors from 500,000 to almost too small to count

21. 21 Senior-Led Performance Management Reviews

22. Strengthen Problem-Solving Networks Performance Improvement Council fosters cross-agency problem solving to drive performance and results Establish peer review networks to help improve quality of goal setting and effectiveness of agency performance reviews In January, reached agreement on core competencies needed for goal setting, evaluating programs, and analyzing and using performance information to improve effectiveness and efficiency in order to: Develop new job classifications for performance management professionals Develop agency training programs 22

23. Overview of GPRA Modernization Act Elevates and Clarifies Performance Leaders by Defining their Roles & Responsibilities – Role for President, Agency Head, COO, Performance Improvement Officer, PIC, and Goal Leaders established in law, further clarified in August 2011 guidance from Lew/Zients Engages Leaders in Performance Improvement by Setting a Limited Number of Priority Goals – President sets longer-term Federal Cross-Agency Priority (CAP) Goals (outcome and management) every 4 years with interim goals set in FY 2013 Budget, with annual and quarterly targets; next priority goals set with FY 2015 Budget – Agency Heads develop Strategic Plans every 4 years beginning February 2014, set Agency Priority Goals (APGs) every 2 years beginning with FY 2013 Budget, and set goals for key aspects of agency performance every year Engages Leaders in Implementation through Frequent Data-Driven Management Reviews – At Least Quarterly Review of CAP Goals by OMB Director/PIC beginning June 30, 2012 – At Least Quarterly Review of APGs by agency COOs beginning June 30, 2011 Improves Usefulness of Performance/Program Information through Reporting Modernization – All program and performance information on central website by October 1, 2012 with quarterly updates on Priority Goals starting November 15, 2012 and annual updates on all goals – Establishes new annual report from OMB Director to Congress on GPRA goals not met beginning in fall 2012 – Requires identification of low-priority program activities and proposals to reduce burdensome Congressional reporting beginning with FY 2013 Budget 23

24. Cross-Agency Priority Goals for release with the 2013 Budget: 1.Exports. Double U.S. exports by the end of 2014. 2.Entrepreneurship and Small Business. Increase federal services to entrepreneurs and small businesses with an emphasis on (1) startups and growing firms and (2) underserved markets. 3.Broadband. As part of expanding all broadband capabilities, ensure 4G broadband coverage for 98% of Americans by 2016. 4.Energy Efficiency. Reduce Energy Intensity (energy demand/$ real GDP) 50% by 2035 (2005 as base year). 5.Improve Career Readiness of Veterans. By September 30, 2013, increase the percent of eligible service members who will be served by career readiness and preparedness programs from 50 percent to 90 percent in order to improve their competitiveness in the job market. 6.Science, Technology, Engineering, and Math Education. Increase the number of well-prepared graduates with STEM degrees by one-third over the next 10 years, resulting in an additional 1 million graduates with degrees in STEM subjects. 7.Job Training. Ensure our country has one of the most skilled workforces in the world by preparing 2 million workers with skills training by 2015 and improving the coordination and delivery of job training services. 8.Increase federal information system cybersecurity. By 2014, achieve 95% utilization of critical administration cybersecurity capabilities on federal information systems. 24

25. Cross-Agency Priority Goals - Management 1.Sustainability. By 2020, the Federal Government will reduce its direct greenhouse gas emissions by 28 percent and will reduce its indirect greenhouse gas emissions by 13 percent by 2020 (from 2008 baseline). (P.gov content to come). 2.Real Property. The Federal Government will manage real property effectively to generate $3 billion in cost savings by the end of 2012. 3.Improper Payments. The Federal Government will reduce the government-wide improper payment rate by at least two percentage points by FY 2014. 4.Data Center Consolidation. Improve IT service delivery, reduce waste and save 3B in taxpayer dollars by closing at least 1200 data centers by FY15. 5.Closing Skills Gaps. By September 30, 2013, close the skills gaps by 50% for 3 to 5 critical Federal Government occupations or competencies, and close additional agency-specific high risk occupation and competency gaps. 6.Acquisition. Reduce the costs of acquiring common products and services through strategic sourcing by agency identification and strategic sourcing of at least two new commodities or services annually in both FY13 and FY14 expected to yield at least a 10% savings reduction agency-wide over the prices paid in the previous year, with at least one for information technology products or services. 25

26. Thank You Questions? Contact Information Dustin S. Brown Deputy Assistant Director for Management Executive Office of the President Office of Management and Budget dbrown@omb.eop.gov 26