GAO: Managers should focus on employee performance

Federal managers are not using the data available to them to improve employee performance, according to the Government Accountability Office.

The Bush administration is focused on moving the federal workforce to a performance-based personnel system, including a hotly debated pay-for-performance structure. The Defense and Homeland Security departments are working out the kinks in their pay-for-performance systems, and a similar one is being floated for extension governmentwide.

A key component to these systems is collecting, and using, performance data on which to base employee pay. Last week, DHS announced it was pushing its first wave of performance-based paychecks back a year; union officials contend the delay is a result of the difficulty in figuring out how to measure performance.

The idea is to collect data on employees' individual accomplishments, and determine pay raises according to that information. But according to GAO, managers across the government have access to performance data already but so far have largely neglected to use it in crafting management decisions.

In 1993, Congress passed the Government Performance and Results Act, which required agencies to collect performance data. In 2004, a GAO study concluded that "while the percentage of federal managers who report having performance measures for their programs has increased over time, their use of performance information in making key management decisions, such as adopting new program approaches or changing work processes, has not."

This latest report (GAO-05-927) gives managers an outline for just how to utilize the information at hand. The recommendations came at the request of Rep. Todd Platts, R-Pa., chairman of the House Government Reform Subcommittee on Government Management, Finance and Accountability.

Managers can use performance data to make decision in four areas, GAO found: identifying problems and taking corrective action, allocating resources, implementing programs, and rewarding workers who meet or exceed expectations.

GAO used the Federal Aviation Administration as an example of an agency that effectively uses performance data to reward outstanding employees. The FAA uses a performance-based pay system for most of its workers. Employees receive a pay raise comparable to the increase for General Schedule workers based on whether "actual performance meets goals." Performance is determined by 31 key measures.

The report also uses the Veterans Health Administration as an exemplar of the proper use of performance information. VHA uses data on the performance of its networks, such as clinical waiting times, the percentage of patients receiving cancer screenings and patient satisfaction, to determine the compensation of the network's director.

GAO outlined a number of management practices that improve the usefulness of performance data. One is simply demonstrating a commitment to using the data. The watchdog agency reported that "demonstrating the willingness and ability to make decisions and manage problems on the basis of results, and inspiring others to embrace such a model" is vital to the value of having performance data in the first place.

Some of the data that agencies collect is not specific enough, or pertinent to managers on the ground, GAO found. Agencies should work with managers to tailor the data collection to their needs. The Small Business Administration achieves a level of specification by allowing managers of each office to determine their own measures.

The report also focused on providing adequate training in using performance data to managers, and frequently communicating available performance information to employees.