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Office of Public and Intergovernmental Affairs

Remarks by Former Deputy Secretary W. Scott Gould

Center for Human Capital Innovation, Leadership Roundtable
Washington, DC
March 31, 2011

Introduction

Thank you, Dr. Zeman, for your kind introduction … and for your invitation to address this Leadership Roundtable.

It’s a pleasure to support CHCI’s mission of improving human capital management across the federal government.

Thank you all for the opportunity to speak with you today.

Leading government through turbulent times requires leaders to think deeply about the role of government; the needs of citizens; and the means by which to serve them.

Lincoln once said that government should do for people only what they cannot do for themselves. Regardless of where you come out on the precise balance between public and private provision of services, I think we can all agree that government should play some role in providing:

  • National security;

  • A system of justice;

  • Regulations to protect individual freedoms and ensure the safety and welfare of the few from the unfettered actions of others;

  • Build and maintain certain kinds of infrastructure; and

  • Care for those unable to help themselves.

Now is a time when we need the government we do have to work better for everyone—faster, more effectively, more efficiently. The complexity of problems that government must address is increasing. As a result, President Obama has challenged us to:

  • Forge a more open government … a more transparent federal structure … with more flexible and responsive processes.

  • Reform the way government does business.

  • Maintain America’s leadership in a rapidly changing world.

How? Win the future by leveraging our historic national strengths.

Out-Innovate. In R&D investments, such as energy technologies. In wind, solar, and clean coal, and investments in medicine. Our goal by 2035 is to obtain 80 percent of America’s energy from “clean” sources. And we can, of course, look to the landmark Affordable Health Care Act which reduces the rate of health care cost growth, including medical malpractice liability.

Out-Educate. We need to build on the Race to the Top. Redefine and right-size the federal government’s role in education. Raise expectations … challenge failures … and reward success. Provide greater flexibility for innovation and improvements. I’m happy to say that my own department is advancing this effort by funding the new Post-9/11 GI Bill. Today, we have 400,000 Veterans in school, covering almost $5 billion in tuition.

Out-Build. We must ensure the fastest, most reliable ways to move people, goods, and information—from roads and airports … to high-speed rail and Internet … to new hospitals and clinics for Veterans. We must rebuild our national infrastructure. For example, there’s the National Wireless Initiative that will help business extend next-generation wireless coverage to 98 percent of Americans.

Now, to make government work for everyone we have to follow three basic principles:

  1. respond to the needs of citizens (people-centered);

  2. meet high-quality standards (results-focused); and,

  3. use resources efficiently now and in the future (future-oriented).

Applying these principles helps us lead in turbulent times. Times that demand leaders who can successfully tackle the problems facing government; who can manage change and challenge in times of uncertainty; and, who can leverage progress for better outcomes.

In my remarks, today, I want to do three things: Describe how VA is using the leadership principles of people-centric, results-focused, and future-oriented to serve Veterans—a case study, if you will. Then, look across government at problems and solutions that are proving effective. And finally, make the case for a response by today’s leaders to meet the President’s challenge to out-innovate … educate … and build.


Principles for Leadership

Secretary Shinseki and the VA leadership team are focused on three principles: People-centric, results-focused, future-oriented. Here are some examples of what we mean and what we are doing about them:

First: people-centric. IT, equipment, and assets alone don’t achieve organizational vision, mission, and goals—people do. Organizational leaders must create, develop, and build systems that encourage and enhance individual potential and productivity … and, in turn, organizational productivity. These include training, development, and professional management systems that support agency goals and objectives, as well as instituting metrics to record and track progress.

At VA, we invest in our people to achieve better operational results. Let me give you some examples. In training, VA’s Learning University delivers a full complement of tiered courses and programs that support professional development and improved on-the-job performance. Additionally, our Office of Corporate Senior Executive Management provides the full scope of human resources services that are the bulwark of VA’s effective management of our executive personnel.

Our second principle is results-focused. We ensure that agency products, services, and initiatives—as well as supporting employee training—link to what our clients, customers, and taxpayers want and expect. Here are some examples of what we’re doing at VA:

  • We’ve implemented new department-wide performance management systems like PMAS—our Project Management Accountability System. Using a rigorous management model, PMAS is an incremental development approach to IT that ensures early identification and correction of under-performing IT programs.

  • Our Program Planning Budgeting System (PPBS) makes informed program policy decisions which tie to our budget and specific multi-year plans.

  • Our executive-level Operational Reviews take a hard and disciplined approach in managing VA’s funded operating plans.

  • And finally, individual performance evaluations and vigorous monthly performance management reviews underscore our belief that measurable performance goes hand-in-hand with VA’s goal of a results-oriented culture.

Third: future-oriented. We are adopting a long view for investments in people and infrastructure to ensure that today’s needs are met … as well as tomorrow’s. For instance, we put a premium on research and development, IT investments, data-driven governance, as well as drawing on the expertise of academia and external think tanks.

When we talk about government, we are talking about people first, not just systems, assets, technology, programs, policies, or money. They are our most precious resource. Government needs more investment in people to deliver a government that works for everyone. Among a host of other management and business process reforms, this includes revamped hiring practices and a greater emphasis on training and development.

The truth is good government is a reflection of the almost two million people who make it that way. Their leadership—their dedication—has been essential to fulfilling the contract between government and the governed for 235 years. Because of that fact, people, in my view, rank as government’s most important resource. We need to treat that national resource as we would any other—as a vital strategic asset worthy of our ongoing investment. And that brings me to leader development.

There’s a distinct set of defining qualities that distinguish American leadership.

  • Vision—knowing what needs to be done … and how to do it;

  • A mix of high-motivation and even higher levels of perseverance; and,

  • A spirit of principled pragmatism on the path to finding what works.

  • Government-wide Initiatives

What are we doing, government-wide, to instill these qualities in our leaders?


Leader Development

Let’s look at leader development. Federal workforce transformation is underway—from recruitment, through retention, to retirement. Its goal? Implement a framework that:

  • Synchronizes current human resources theory with accepted, successful management practices;

  • Executes progressive policies from both the public and private sectors; and

  • Incorporates the ‘people factor’ in the way we manage.

OMB is building systems aimed at improving performance management under the leadership of Jeff Zientz.

At OPM, John Berry has the lead in:

  • Strengthening the link between appraisal systems and agency performance goals;

  • Broadening training efforts for executives;

  • Piloting rotational opportunities for high-potential staff below SES level;

  • Developing shared government-wide capacity to market/recruit for SES positions; and,

  • Developing a one-year on-boarding program for SES.

Customer Service

Another flashpoint is customer service. We are being confronted with the rising expectations of our clients—the American taxpayer. Much of it is driven by consumer-obsessed corporations that operate on the razor’s edge of R&D, marketing, and customer service. In response, government is engaging in broad and growing outreach to citizens. Here are some eye-opening statistics:

  • There are now 2,000 top-level websites across the federal sector, with 89 million unique visitors monthly;

  • There are 2,500 walk-in centers serving about 4 million visitors monthly; and,

  • 3,000 public phone lines handling 30 million calls monthly

But, in general, customer service lags behind the private sector and varies in quality across agencies and departments. A recent American Customer Satisfaction Index found that overall customer satisfaction with the government is at a 10-year low, although certain services score high, for example, VA’s National Cemetery Administration is ranked number one in the United States.

Some, but not all, key services are available online. And when collected, customer feedback is usually obtained through surveys rather than less formal means like focus groups and panels.

What’s been done to upgrade customer service? For one thing, more and more services are online, like immigration status mobile alerts. There is a streamlined approval process in place for conducting focus groups and post-transaction surveys. And there is an upcoming effort to increase metrics for key services, for example, the average processing time for VA disability claims.

Added to that are the signature pilot initiatives being developed that use technology to improve the customer experience. Government is engaging in collective, new thinking to leverage new and better ideas, new approaches, novel methodologies, and in casting a wide net to capture best practices from all sectors. We are engaging our clients as people … advocating on their behalf … and empowering them with clear, consistent information.


Contracting

Let’s turn to contracting. Government spends approximately $500 billion per year on contracting. That’s a lot of taxpayer money. Strides have been made in leveraging government’s purchasing power to “buy smarter” as it annually spends $1.6 billion in office supplies, $6 billion in commercial software, and $2 billion in printers and their maintenance and supplies. However, improving services contracting is problematic. As government has embraced outsourcing, we’ve seen a ballooning of contracting for services—IT, engineering, architectural, janitorial, HR, EEO, legal, financial, consulting.

The numbers tell the story. In 2006, $260 billion. In 2011, that number has risen to $324 billion.

Strategy development is underway as government tries to figure out a smarter way to buy services. The issues confronting us are significant:

  • Results-based services;

  • Certified qualifications of contractors;

  • Innovative work;

  • Getting the best value; and,

  • Better revenue models.

And then there are the issues unique to the federal government. For one thing, statutory requirements for competition preclude long-term partnerships common in the private sector. And then there is the complicated legal framework for “umbrella” contracts, with actual work handled through task orders under the contracts. And finally, there are socio-economic considerations that favor contracting with small, and other types of businesses, to include disabled Veteran, Veteran-owned, women-owned, and HubZone businesses.

So what’s being done to improve contracting? The Services Acquisition Reform Act established a Chief Acquisitions Officer in all civilian agencies to consolidate the acquisitions function. Efforts are well underway to streamline the acquisition process across government and, simultaneously, develop a well-trained acquisition workforce. And strategic sourcing is aligning acquisition capability with agency mission outcomes.


IT Reform

Government spends over $80 billion annually on IT systems. Currently, there are more than 12,000 of them. But all too often, projects end up being more expensive, taking longer, or delivering fewer capabilities than planned. Of the current major projects, 40 percent are identified by agencies as not on track.

Let’s look at the root causes.

  • Projects are improperly scoped, with first deliverables due years after work begins;

  • Program managers do not have the technical knowledge or management skills to oversee complex IT projects; and,

  • The budget and acquisition processes frequently require agencies to make final decisions on technology solutions years in advance rather than at the point of execution.

What efforts are underway to turn this around?

  • The IT dashboard tracks investments and assigns ratings.<

  • Monthly TechStat sessions have achieved $3 billion in savings.

  • Government has executed a 25-point IT reform plan that addresses structural problems that often get in the way of consistent execution.

  • Formal IT program management and IT acquisition career paths have been established, to include integrated program teams.

  • Best practices are being shared across government.

  • Efforts are geared to support modular development.

  • Agencies are working with Congress to support flexible IT budget models.

  • We are strengthening the government structures that review major projects.

The IT reform agenda focuses on three key objectives. First, using a modular approach to drive-down the average size and duration of IT projects, and drive up success rates on nearly $50 billion of IT program spend. Second, it is targeted on improving the yield on $24 billion in IT infrastructure spending and shifting spending from redundant, underutilized infrastructure to mission-priority programs. And last, the push is to utilize a Cloud First approach to achieve up to 50% lower per unit cost.

I’ve just given a telescoped look at just a few of the major initiatives underway across government. They are part of a larger, overarching paradigm that can be summed up this way: In the business of government, business as usual will no longer do.

And the fact is, there’s a host of initiatives … innovations … and new or retooled programs and processes underway in every department and agency across government, all with an eye toward:

  • Improving organizational performance by delivering quality programs and services;

  • Making people-centric service our hallmark;

  • Developing strategies for working smarter through collaborations and best practices from all sectors;

  • Leveraging partnerships as force multipliers in meeting our missions;

  • Engaging in collective problem-solving and opening our minds to new thinking and creative approaches; and,

  • Infusing a culture of innovation across government—always being on the lookout for the next new opportunity to better serve our tax-paying customers. And that means that leaders like you must be open to new thinking and new approaches … novel methodologies … and new and better ideas. Why? Because that’s where the future lies.

Challenges of Government Leadership

Well, it’s an understatement to say that this is an exciting time to be working in government! When we talk about leadership during turbulent times, we are talking about every day challenges that transcend ideology or politics. We are talking about contributing mightily to our common cause—good government.

There are great challenges before each of you, most certainly. But also even greater opportunities for achievement. As public servants—as leaders—our job is to care for an increasingly sophisticated taxpaying public … deliver results for them … and build solidly for the future.

At this critical juncture, we have the opportunity to shape government for the 21st century. Not an easy task. The rigors of leadership are no less than its rewards. And no matter what your agency mission may be, there are problems and challenges. There always will be.

President Obama is working hard to reform government so that it’s leaner and smarter … so that barriers are removed, and incentives created for new growth. He needs all of us to do our part.

In my view, many of the systemic problems that have hobbled government for far too long are giving way. Change and transformation are works in progress. And in your work, whatever it might be, you can be progress-promoters not just caretakers of the status quo … because the status quo is unacceptable to our clients—the American people.

As you manage the complex functions that drive government’s day-to-day operations, I would challenge you to do a number of things:

Take the initiative. Start by defining the problem or issue before you and then find out who is doing the best to solve it—public or private … NGO or academia … national or global. No agency, no business, can work in a vacuum. No one person or organization has all the answers.

Collaborations, teaming, and partnerships are essential to doing business in the 21st century. Select the few solutions, from among the many, that warrant an investment of time, energy, and resources, and then move forward to adopt the solution that proves best.

On another front, work to create a spirit of innovation. Remember that innovation in the public sector is no longer a luxury—it’s a necessity.

Don’t be risk-averse—it’s the oxygen of progress. But make haste with caution.

Communicate—with your colleagues and your customers; within your own agency, and with others.

Leave your mark on the programs, policies, and services—the resources and assets charged to you.

A maxim to keep in mind—“Your legacy should be that you made it better than it was when you got it.” Based on my experience, that’s excellent advice.


Conclusion

In closing, let me leave you with the words of President John Kennedy. A half-century ago, he transformed the image of a federal career and inspired a generation of Americans to serve the public interest.

In 1961—in times of challenge not unlike our own—he shared his admiration for those who serve our country through government service.

Let the public service be a proud and lively career. And let every man and woman who works in any area of our national government … be able to say with pride and honor in future years: I served the United States government in that hour of our nation’s need. Let me thank you all for your service and extend my best wishes for success in the hard work that lies ahead.