OMB turns up heat on performance

"Link budget and management decisions to performance,"

The information technology programs that support many government services are among those the Bush administration may test to see how to link program performance to agencies' budgets.

Establishing that link is at the top of President Bush's management agenda, said Sean O'Keefe, deputy director of the Office of Management and Budget. In the fiscal 2002 budget, Bush outlined his intention to move forward with the Government Performance and Results Act (GPRA) of 1993 by choosing a set of programs across government to test agencies' abilities to set goals, measure performance and use the information to improve results.

OMB officials are reviewing agencies' fiscal 2003 budgets, O'Keefe told a House subcommittee last week, and as part of that process, they have defined five requirements that must be met for a program to be included in the trial (see box). An agency's ability to clearly define a performance result—not, for example, something as amorphous as "the achievement of world peace" for the State Department—is the top requirement, O'Keefe said.

"This is a very rigid, extremely specific set of criteria," O'Keefe said. "There's going to be a selected number of programs that can pass through this process."

During the past two years, agencies have had trouble identifying the goals and measurements that would yield the kind of information needed to improve programs, according to an analysis from scholars at the Mercatus Center of George Mason University.

As chairman of the Senate Governmental Affairs Committee, Sen. Fred Thompson (R-Tenn.) commissioned an analysis of the 1999 and 2000 reports by the General Accounting Office and the Mercatus Center. He wants agency leaders to move past developing plans and reports to using performance information in their daily management. Thompson also wants Congress to use the information for oversight and funding decisions. But those goals will not be met until agencies can get the first step right, he said.

"It's not how many pieces of paper we shuffle, [it's] how many phones we answer," Thompson said.

It is not easy for agencies to come up with the right goals and measurements, said Maurice McTigue, distinguished visiting scholar at the Mercatus Center. McTigue came to the center from New Zealand, which started using results-based decision-making in the early 1990s, and his analysis showed that many agencies have been focused on fixing the consequences of problems, not addressing what causes them. Until the right goals are identified, the rest of the process is useless, he said.

OMB has not set the number of programs it plans to choose for the trial, and it is unclear how many could be IT programs, said Christopher Ullman, associate director of communications for OMB. But IT is one of the high-risk management challenges identified by GAO, and many agencies have specified improving IT programs as goals in their performance plans the past two years without reporting any real progress.

In one case, the Treasury Department set the goal of creating a financial systems integration framework, with the intended result of generating complete and accurate financial and performance information on which to base program decisions. But a June 2000 GAO report found no performance measurement in the Treasury plans to determine whether the department was making any progress toward that goal.

The CIO Council is working with OMB to help agencies identify programs that will meet OMB's requirements, said Jim Flyzik, the Treasury Department's chief information officer. Flyzik added that it is difficult for agencies to define clear goals, "but we will take a shot at it."

Performance measurement is crucial if the government is to operate more like a business, said John Mitchell, deputy director of the U.S. Mint, which was one of the agencies that participated in a 1994 pilot program to test the concept of linking program performance with agency budgets.