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Last week's Office of Management and Budget guidelines for fiscal 2011 spending requests differ from past administrations' documents in one critical respect: they will allow agencies to set their own performance priorities.

In the June 11 memorandum, OMB Director Peter R. Orszag asked agency heads to identify a limited number of high-priority goals and begin developing strategies to address them. Orszag wrote that having each agency spell out its goals is a first step to meeting the president's agenda for building a high-performing government. These goals and progress toward them will be reviewed regularly, Orszag said.

John Kamensky, senior fellow at the IBM Center for the Business of Government, said it is normal for administrations to release budget guidance memos in this time frame, but called the section on identifying performance goals "unusual." Kamensky particularly praised Orszag for learning from past administrations that agencies, not the White House or OMB, should set priorities.

"This is the first time that someone has actually taken a lesson that's been learned earlier and applied it without having to relearn the lesson," he said.

Kamensky said agencies are by far the most qualified to identify what needs to be done and to begin laying out how; the White House and OMB should offer support to leaders and managers as they tackle these challenges.

Orszag identified a few things for agency leaders to keep in mind when establishing priorities, including the need for them to have high direct value to the public or reflect a key agency mission, as opposed to being focused on internal management or administrative tasks. The OMB leader instructed agencies to set priorities that already have sufficient funding for successful implementation, even if legislative changes are necessary.

The priorities should address challenges agencies are unlikely to overcome without a concerted focus of resources but, once resolved, will likely lead to improved efficiency and effectiveness, Orszag wrote. They also are supposed to be relatively near-term goals with performance outcomes officials can evaluate and measure in a timely fashion.

For each priority, agencies must define the problem and goal, name contributing programs within and outside the agency, identify lead officials responsible for implementation, and outline strategy and key performance measures. Agencies won't have a lot of time to gather this information; it is due to OMB by July 31.

Kamensky said Orszag's statement that OMB will work with the Performance Improvement Council to develop a standard template and examples for how the information should be submitted was encouraging.

"Turning to leaders in agencies to help design it shows they're open to other people's input," Kamensky said.