Lessons to unlearn: New fiscal climate demands new ideas

Public sector executives looking to carry out their agency's mission in the current stringent fiscal environment should not look to the past but instead focus on reshaping current organizational strategies and rethink management approaches for future government employees, according to a new report.

Against the backdrop of looming spending cuts and the public’s growing distrust in the government, the Corporate Executive Board has released a report, called “Achieving Mission in the New Budgetary Environment,” that offers imperatives and best practices to help government leaders weather the worsening storm.

“We’re now faced with a new set of challenges, with the recession, the stagnation in the economy,” noted Anthony Williams, former D.C. mayor and executive director of the government practice at the Corporate Executive Board. “Most important as it relates to the federal government is the debt from anywhere between $1.5 trillion to $4 trillion dollars pulled out of the economy that is really forcing government to look not backward but forward, and look at new basic approaches to how it does business, how it relates to its mission, how it looks at its operations.”

Williams said the first imperative for organizations is to avoid reorganization traps. Experiences in the private sector have shown that many reorganization efforts are only successfully in the short term, Williams said, and even when they are successful, there is a significant cost in terms of employee morale and involvement.

Plans that don’t consider the long term, inadequate accountability or resistant employees could all impede the reorganization effort. Motivating employees, especially, is essential to restructuring success, the report said, yet many initiatives lead to increased levels of disengagement.

Another imperative is how organizational planning and strategies need to be considered in a new light, and Williams emphasized taking a bold approach.

“Now we've really got to be bold,” he said. “We can’t just be safe. We've really got to be bold. And with bold, we’re not talking about predicable work plans anymore. If you’re moving out of the rigid corporate structure to a new structure, the work plans are going to be more varied because you want to be more flexible, more nimble.”

While more than 80 percent of reorganization efforts meet or surpass their financial targets, nearly 75 percent see a slump in employee performance for the next 18 months, according to the report. It’s important to efficiently communicate why changes are being made as research shows that communication failure is one of the most common challenges in the majority of all change initiatives.

Williams, who served as chief financial officer in the Agriculture department during the Clinton administration, said his experience in government has taught him how the focus of a message to employees is just as vital as the communication itself.

“If you said the same thing and communicated the same thing over and over and over to your employees, the same way you would with your constituency – kind of like branding – it can’t be 40 things, it can’t be even be five things, but if it’s three things … they get that that’s important,” he said.