Agencies should jump on PMAT wagon

In the book I wrote in the late 1980s about the problems with federal information technology procurement, I made a recommendation to partly base the performance evaluation of procurement on surveys of how satisfied IT and program customers were with the service they had received from contracting folks.

At the time, I placed the idea in the "impossible dream pile." Most of the contracting people I had spoken with no more regarded IT or program folks as their customers than Drug Enforcement Administration agents so regard Colombian drug lords. The culture at the time would have viewed such surveys as an encouragement to procurement people to close their eyes to violations of laws and regulations.

Imagine my surprise when I entered government in 1993 and discovered that an interagency group called the Procurement Measurement Action Team (PMAT) had been working together to develop performance measurements for the procurement function, including a customer satisfaction survey for program and IT customers. PMAT had been set up by a group of seven procurement executives from civilian agencies that had banded into a group called the Procurement Executives Association, which was headed by the Treasury Department's then-procurement executive Bob Welch, who is now procurement executive at the Commerce Department.

If anybody wants to know why procurement reform became possible, they need look no further than the formation of PMAT. Here— in the wake of the Total Quality Management movement of the early 1990s, the Government Performance and Results Act (GPRA) of 1993 and the first rumblings of the National Performance Review— was the procurement community that was seizing the initiative to measure, and thus try to improve, its performance. The movement was receiving the help of visionaries such as Welch and Rich Hopf, then procurement executive at the General Services Administration and now at the Energy Department.

The initial effort was discussed in Robert Kaplan and David Norton's pathfinding book, The Balanced Scorecard, and won an International Benchmarking Clearinghouse prize, which is seldom given to public-sector efforts.

Now, four years after PMAT was formed, the reform effort is not only alive but growing. In April, for example, Commerce issued its fourth annual PMAT report, in which Commerce bureaus are compared with each other and trend lines since the 1994 base line are presented for the entire department and for individual bureaus.

Bureaus are scored on timeliness and the quality of goods or services procured (based on customer surveys), on the quality of the work force (based on customer, employee and contractor surveys) as well as on quantitative measures of how much is spent on the administration to spend a procurement dollar and on negotiated cost savings (achieved through introduction of competition, negotiations, volume discounts, consolidation of requirements and price renegotiations during contract performance). Bureaus' scores that are listed in black are better than average, and scores in red are worse than average.

Significant improvements have occurred throughout Commerce since measurement began in 1994. On a scale of 0 to 1, customer perception of quality has improved from 0.74 to 0.88, and the perception of timeliness from 0.71 to 0.87. After a dip in 1996, negotiated savings were up dramatically in l997.

Action-Improvement Plans

As of this year, Commerce's individual agency procurement shops that fall below the average for bureaus departmentwide on any performance measure will be required to present action-improvement plans to their agency chief financial officer. In a memo to the heads of agency procurement shops, Welch stated, "Because I support each of you in this inward journey, I will review these plans, ensuring that you receive the senior executive attention, support and commitment you need." The next step, in my view, is to tie the measures to the performance plans of individuals and teams in contracting shops.

Additional civilian agencies, such as the Social Security Administration, are beginning to use PMAT. And a crucial change is that the "M" in PMAT has changed from "measurement" to "management," a realization that using the measures as a management tool is key to gaining improved performance.

Also in April, the Procurement Executives Association— which includes representation from the departments of Commerce, Energy, Health and Human Services, Interior, State, and Transportation as well as GSA— chartered a group to move PMAT to its next stage. The agencies have committed themselves to jointly use the performance measures the group develops.

The group seeks to tie its performance measures to the objectives for the procurement system listed in the "core guiding principles" of the Federal Acquisition Regulation— such as procurement of quality goods and services, teamwork and maintenance of public trust— and to introduce a greater number of objective measures into their system— such as percentage of bid protests sustained and the dollar volume of interest payments under the Prompt Pay Act.

The team's work is almost completed, and one of the performance measures the team set was to convince agencies not currently using the measures to adopt them.

Rep. Steve Horn (R-Calif.) has been promoting legislation, discussed recently in Federal Computer Week, that would, among other things, require the Office of Federal Procurement Policy to develop a procurement performance measurement system for the government. As PMAT indicates, such efforts are already under way through voluntary teamwork among procurement shops and procurement leaders who are committed to delivering better government.

Not only should other agency procurement shops take a look at PMAT, but those trying to make GPRA happen throughout government should as well. And maybe Horn might find time to say a word or two in praise of the dedicated career government employees who have put their hearts into this bit of bootstrapping.

Kelman was the administrator of the Office of Federal Procurement Policy from 1993 to 1997. He is now Weatherhead Professor of Public Management at Harvard's Kennedy School of Government.