PMC sets up performance measurements

Top Cabinet officials have agreed on a set of performance measurements for procurement that agencies will use to determine how well agencies serve users.

The President's Management Council (PMC), whose members include department deputy secretaries, said last month that agency procurement offices should set goals for price, quality of goods, timeliness of purchases and productivity. Each agency will develop its own performance measurement plan by the end of this fiscal year and apply it during fiscal 1997.

Under this program, agencies are expected to choose measures in each performance category that reflect their mission, organizational structure and the types of purchases they make. A task force that developed the plan for the council suggested more than four dozen possible measures, ranging from the percentage of contracts with cost overruns to the results of customer surveys.

"One of the things we're looking at is for agencies to benchmark themselves to see if procurement reform is helping them improve," said David Litman, director of acquisition and grant management with the Transportation Department, who led the task force.

For now, the performance data will only be used internally by each agency, and it will be up to each agency to decide how it will respond to its findings, Litman said. The program is one way the government plans to comply with the Government Performance and Results Act, as that law takes full effect over the next few years, he added.

According to a summary of the PMC's March 6 meeting, during which the program was adopted, the Office of Management and Budget does not plan to reduce agency budgets based on savings that come from achieving performance goals. Money saved on procurement could be used for programs instead.

Eventually, some measurements might be adopted on a governmentwide basis, according to the task force report.

"It's a very big deal," said Steven Kelman, administrator of the Office of Federal Procurement Policy. "We're working toward a situation where the procurement system is held accountable for results."

The procurement performance measures are not directly connected to the performance measures required for major systems acquisitions under the Federal Acquisition Streamlining Act of 1994, Kelman said, although they have a similar intent. While the FASA-mandated measures are supposed to apply to individual procurements, these new measures apply to buyers' performance generally.

Such measurements are new to most agencies, and many agencies have struggled to define what their goals are, much less how to gauge them.

The agencywide measures could be used to fulfill another FASA provision, however: rewarding contracting officials who run their programs efficiently, Kelman said. But, Litman noted, "we haven't quite linked the two together."