Chapter10.docx

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Chapter 10
THE MANAGER’S TOOLBOX

Public management is “a world of settled institutions designed to allow imperfect people to use flawed procedures to cope with insoluble problems.”

—James Q. Wilson (1989, p. 375)

Managers are responsible for developing and sustaining a high-performing organization. There are many tools that managers have in their toolbox to help them achieve this goal. Some of these tools have been adopted from the private sector, others from local governments, and still others from state and federal agencies. This chapter focuses on the tools that are essential for managing contemporary local governments—strategic planning, performance measurement, program evaluation, budgeting for results, and succession planning—and provides examples of lessons learned from experience.
BUILDING ORGANIZATIONAL CAPACITY
As discussed in Chapter 7, managers work with elected officials as organizational capacity builders. This responsibility can be traced to the founding of council–manager government more than 100 years ago, when municipalities were growing rapidly and demanding infrastructure improvements to increase mobility and safety. Many managers at that time were trained engineers and brought to their jurisdiction public works experiences that were critical to constructing streets and sidewalks, lighting systems, water and sewer lines, and traffic controls as communities began their transformation from rural/agrarian to urban/industrial economic bases.
POSDCORB
The 1930s witnessed a second significant change in the manager’s skills and abilities. As the field of public administration evolved, managers were expected to put basic systems in place for planning, managing, financing, and executing the work of local governments. Luther Gulick and Lyndall Urwick coined the acronym POSDCORB to capture seven basic principles that, in their judgment, were applicable to all organizations regardless of purpose, place, or clientele—planning, organizing, staffing, directing, coordinating, reporting, and budgeting. The manager’s job was to apply these principles to enhance organizational performance in a quest for efficiency. At that time, administrative orthodoxy held that administration was a science, that politics and administration were separate, and that public administrators were neutrally competent and value free. These themes began to change with World War II, the explosion of the federal government’s domestic role in the postwar period, and changes in the field of public administration in the behavioral era. But POSDCORB remained the dominant theme of managerial work and efficiency (Gulick & Urwick, 1937).
Federal Bureaucratic Reforms
Beginning in the 1960s, POSDCORB principles were joined in the manager’s toolbox with reforms incorporating innovations and best practices from the private sector and other governments. These reforms were intended to not only improve government efficiency but to also connect expenditures to performance outcomes. Bureaucratic reform efforts since the 1960s have focused on budgeting, personnel, and performance management (see the summary in Table 10.1).
One such approach to maximizing efficiency was the planning–programming–budgeting system (PPBS), championed by Secretary of Defense Robert McNamara based on his experience as chief executive officer of the Ford Motor Company. PPBS was an example of rational decision making, in which “the goal of any activity, including governmental programs, is to get the biggest return for any investment. Simply put . . . to get the most bang for the buck” (Kettl, 2015, p. 265). PPBS had three phases: (1) senior managers developed five-year plans and strategies for defense; (2) strategies were translated into detailed weapons systems and other programs with delivery schedules; and (3) the plans and programs were presented as budget requests each year. In these ways, the annual budgeting process was linked to longer-range objectives, emphasis was placed on the program rather than organizational unit (i.e., program budgeting), and inputs were tied to outcomes.

Table 10.1 Bureaucratic Reform Models

Reform Effort

Description

Year Instituted

Planning–programming–budgeting system (PPBS)

Management tool designed to use data and analysis to support budgeting choices. Also called output budgeting

1961

Management by Objectives (MBO)

Personnel management method in which staff set measurable personal goals that align with organizational goals

1973

Zero-based budgeting (ZBB)

Budgeting method in which all expenditures in a given period must be justified; begins with a zero base instead of an incremental increase from the previous fiscal year

1977

National Performance Review (NPR)

Customer-focused management model in which citizens are customers and governments should find the ways that serve their customers best, whether that is in-house or through alternative service delivery methods

1992

President Lyndon Johnson thought the PPBS results in the defense area were impressive, so in 1965, he directed that program budgeting be expanded to include nearly all federal departments and agencies. Managers were directed to submit to the Bureau of the Budget five-year plans on future programming and related financial requirements, accompanied by cost-benefit analyses of alternatives. Not surprisingly, PPBS soon became characterized by wish lists, excessive paperwork, and disconnects between program desires and financial realities. There was no -in from Congress, who was not consulted, did not receive PPBS information and analysis, and continued to follow its traditional approach to budgeting. Strong bureaucratic resistance to innovation and change also could not be overcome:
Lower organizational units were upset that PPBS appeared to rob them of authority . . . that it shifted analytical work from agency staffs knowledgeable about an agency’s policy area to PPBS technicians skilled in quantifying but unacquainted with the agency’s policy area, and that it required an enormous amount of paperwork without discernible impact on decision making. (Kettl, 2015, p. 268)
PPBS was abandoned by the federal government in 1971. However, as will be seen, components of PPBS remained in place and were incorporated into subsequent administrative reforms.
Other federal reform efforts were instituted in subsequent administrations, but none gained enough traction with Congress and the federal bureaucracy to be sustained for the long term. The two most widely cited were management by objectives (MBO) and zero-based budgeting (ZBB). MBO is a personnel management tool that was instituted by the Nixon administration (1973–1974). Organizations using MBO encourage management and staff to work together to develop individual goals and align them with organizational goals. Progress on goal accomplishment is then tracked over time. While MBO was only used for a short time at the federal level, a recent study found that 17% of 893 municipalities responding to a survey were using MBO alone or in combination with other management models (Holliman & Bouchard, 2015).
ZBB was implemented by the Carter administration between 1977 and 1979. Using this method of budgeting, each unit of the organization was required to zero out the base and justify every expenditure each fiscal year. The rationale behind this method is that government budgeting tends to be incremental; each year, a percentage increase is added to the prior year’s budget without reexamining base spending. In theory, ZBB would encourage staff to consider whether any given program was necessary to continue or whether the programs could be provided in a more cost-efficient way. ZBB requires an enormous amount of paperwork and time to do correctly. In practice today, ZBB is nearly nonexistent at the local level (Kavanagh, 2011).
Reinventing Government
Perhaps the most significant reform that has influenced the manager’s toolbox was the Reinventing Government movement of the 1990s. Reinventing Government was different in scope, substance, and impact from earlier bureaucratic reform efforts. It also challenged many traditional assumptions about the roles of public agencies and public administrators. Launched by two books, Reinventing Government (1992) by consultant David Osborne and former city manager Ted Gaebler and Banishing Bureaucracy (1997) by David Osborne and former Michigan Department of Commerce official Peter Plastrik, the tone of the movement was captured in the subtitle of the former: “How the Entrepreneurial Spirit is Transforming the Public Sector from Schoolhouse to Statehouse, City Hall to the Pentagon.” The broad appeal of Reinventing Government’s theme was underscored by Reinventing Government achieving New York Times best-seller list status. Unlike earlier models, Reinventing Government was originally developed at the local government level. It was embraced by the Clinton administration, principally through the National Performance Review (NPR) initiative, led by Vice President Al Gore between 1993 and 2001, that promised to make government work better and cost less.
The rationale for Reinventing Government was based on a number of trends, issues, and developments that are still relevant today. These include citizen desires for more for less from government amidst significant resource constraints; the chilling effect of the four Ds—deficits, debt, defense, and demographics—on the federal government’s ability to financially support domestic programs; the public’s confidence in lower levels of government as service providers; the appeal and applicability of models from the private sector, such as rightsizing, delayering, and lean management; and the straitjacket effects of Progressive Era reforms, such as civil service requirements and line-item budgets that sought to insulate and isolate the public service from partisanship and corruption but also impeded the ability of government officials to respond nimbly and effectively.
According to Osborne and Gaebler (1992), traditional government program approaches, where monopolistic organizations spend appropriated public funds to deliver a service, have several flaws. First, they are subjected to the desires and demands of powerful constituency groups instead of customers. Second, they are driven by political pressure (which waters down and blurs goals) and not by rational plans and policies. Third, they devote too much attention to turf and custody battles over programs and clientele and not enough to effective management. Fourth, they fragment service delivery systems, each of which has its own procedures and none of which are user friendly. Fifth, they have no self-correcting mechanisms when results or outcomes are not being achieved; sometimes success is penalized (such as when all appropriated funds are not spent, raising questions about demand for services) and failure is rewarded (such as when public administrators ask for more money because they are unable to achieve goals). Sixth, they rarely achieve a fiscal magnitude that is necessary to attain their mission, such as ending poverty, achieving national K–12 education goals, and rebuilding neighborhoods. Finally, they function on a command–control, top-down system rather than an incentive basis, and often, the commands are not followed by subordinates or cannot be enforced by senior managers. In the view of Osborne and Gaebler (1992), the role of governments is to steer the ship of state, leaving the rowing to others, including private firms and nonprofit organizations (pp. 285–290).
Twenty-five years after the publication of Reinventing Government, many of the principles, practices, and protocols that formed the foundation of the movement have been adopted at all levels of government and have affected both the strategies and the tools managers have available to do their work. Some of these core principles that the reinventers contend should drive practice include the following:
· Governments should use alternatives to in-house delivery and focus on making policy and conducting oversight while other organizations, especially the private sector, handle implementation (e.g., charter schools, trash collection, corrections, parking meters).
· Public agencies should be driven by their mission rather than by the rule book.
· Public administrators should be outcome and results oriented instead of input and process oriented, and performance assessments and funding awards should be based on the former.
· Clients should be considered customers, and their needs as stakeholders should be taken into account in determining plans, priorities, and delivery systems.
· Public administrators should work to empower citizens to participate in the planning and coproduction of services through neighborhood councils and community groups (e.g., recreation services, senior citizen and veteran assistance, crime prevention).
· Competition should be encouraged within the public sector, such as competitive bidding for service delivery, as well as between government agencies and private sector organizations (e.g., school choice and voucher plans).
· Authority and responsibility should be decentralized.
· Public agencies should be authorized to earn money through fees, run surpluses and retain a portion of unspent appropriations for use in the next fiscal year, and leverage the marketplace through incentives for investment.
· Adoption of these principles would make government at all levels more nimble, entrepreneurial, and customer focused. As noted earlier, the Clinton administration’s NPR was established in 1993 to spearhead adoption of reinvention approaches by federal departments and agencies as well as by state and local governments that received federal funding. The promise of NPR, for a government that works better and costs less and moves from red tape to results, was partly achieved by reducing the federal civilian workforce by 272,900 positions (about a 12% cut), producing the smallest workforce since 1967 and about $108 billion in savings, some of which were offset by relying on private contractors to do the work formerly performed by civil servants (Kettl, 1998, pp. 2–3). Many of these positions were so-called checkers, who were viewed as being guilty of overcontrol and micromanagement, resulting in stifled creativity and reduced flexibility. These personnel included supervisors, personnel specialists, budget analysts, procurement specialists, auditors, accountants, and middle managers—the very people who help ensure accountability, neutrality, and efficiency. Clearly, the focus was more on costs less than works better. The NPR also adopted reengineering strategies by using computer systems and telecommunications to transform service delivery and replace obsolete structures. And the NPR included customer service, streamlined procurement, decentralized decision making, and employee empowerment among the components of a continuous improvement strategy (NPR, 1993).
· In 1998, the Brookings Institution issued a five-year report card on the Clinton administration’s efforts to embed Reinventing Government into the cultures and operations of federal agencies through the NPR. The principal investigator was Donald Kettl, who observed, “No administration in history has invested such sustained, high-level attention to management reform efforts” (1998, p. ix). NPR’s overall grade was B, with the highest grades given to effort (A+) and procurement reform (A) and the lowest to relations with Congress (D) and identifying objectives of government (D). When George Bush became President, the NPR was terminated. Nevertheless, similar to PPBS, components of Reinventing Government remained in place in the executive branch, including strategic planning, outsourcing, performance measurement, purchasing cards, and customer service components.
· Not surprisingly, some leaders in the public administration community criticized the reinvention movement. Many practitioners also were skeptical. Robert and Janet Denhardt, for instance, advocated a New Public Service model, arguing that public administrators should serve citizens not customers and not try to steer society in new directions. They should be attentive to more than marketplace forces and accountability mechanisms and especially be responsible to law, community values, political norms, professional standards, and the interests of citizens. In their view, citizenship should be valued above entrepreneurship (Denhardt & Denhardt, 2011).
· THE MANAGER’S TOOLBOX
· The preceding highlights of significant administrative reform efforts provide a context for discussing five of the most important tools that should be in the manager’s toolbox. Four of the five tools covered—strategic planning, performance measurement, program evaluation, and budgeting for results—are survivors in the sense that they have been components of administrative reform efforts over the years under various names and led by different levels of government. The fifth—succession planning—is a relative newcomer, but it will be an essential tool given the anticipated changes in public sector workforce demographics. There are variations in each approach, and the following overview will highlight best practices and provide managers with potential challenges they should be aware of when applying them. Emphasis will be placed on strategic planning, performance measurement, and budgeting as the three most comprehensive and integrative tools for managers to utilize.
· Strategic Planning
· Strategic planning originated in the private sector and its use in government is relatively recent. Beginning in the 1980s, however, strategic planning spread widely across the intergovernmental system. Its growth was first spurred by the publication of a pathbreaking book by former Ohio Budget Director John Olsen and consultant Douglas Eadie in 1982 entitled The Game Plan: Governance with Foresight and then by the Reinventing Government movement and the Government Performance and Results Act (GPRA) of 1993. All federal agencies now produce and revise strategic plans, and most states and localities have engaged in this practice as well (Bryson, Berry, & Yang, 2010, pp. 499–500). A 1999 survey of state administrators by Jeffrey Brudney, Ted Hebert, and Deil Wright found that strategic planning was the most widely implemented of the Reinventing Government reforms.
John Bryson (2010) defines strategic planning as “a deliberate, disciplined effort to produce fundamental decisions and actions that shape and guide what an organization (or other entity) is, what it does, and why it does it” (p. S256). Strategic planning has two organizational benefits: (1) It helps promote strategic thought and action through systematic information gathering, negotiating performance measures, clarifying future directions, and establishing priorities for action and (2) it improves decision making and organizational effectiveness by focusing attention on current issues and emerging challenges, providing a framework for decisions, improving coordination and collaboration across levels and functions, and building administrative capacity over time. Through strategic planning, an organization can gain legitimacy with its stakeholders by engaging them in the process, soliciting their assessment of how well the organization is performing, and relating goals and objectives to their expectations. It can also improve employee morale and connect an individual’s work to larger organizational mission and goals (Bryson, 2010, p. S255).
Despite these benefits, the strategic planning record is mixed and, as Theodore Poister (2010) observed, “the extent to which these efforts are worthwhile is not all that clear” (p. S247). It is difficult to assess the impact of strategic planning, as there are so many variables involved in implementation and some activities may not be measurable. However, Bryson’s review of the record in the more than 25 years since publication of The Game Plan: Governance with Foresight concluded, “strategic planning does produce positive benefits on a modest scale, and in some instances, produces quite outstanding positive results” (2010, p. S258). The challenge to public managers is to get the most benefit from this tool.
Strategic planning is an excellent illustration of the rational approach to decision making. The process has eight fundamental components: (1) a situational analysis of strategic issues, sometimes called a SWOT analysis (strengths, weaknesses, opportunities, and threats) or, more positively, a SOAR analysis (strengths, opportunities, aspirations, and results); (2) a mission statement of why and for whom the organization exists, why it is distinctive or unique, what the core functions are, and how it adds value; (3) a values statement regarding what the organization stands for and how it treats its employees and customers; (4) a vision statement of what the organization will look like and the impact it will have when the plan is fully implemented; (5) goals statements, usually from three to five, describing the major activities to be undertaken through operationalizing the plan; (6) objectives statements for each goal, quantifying what progress is expected over time as implementation proceeds and embracing SMART (specific, measurable, aggressive but attainable, results-oriented, and time-bound) principles; (7) strategies and action plans, indicating strategies such as adaptive market entry or withdrawal and positioning, resources and time lines, and responsible parties (sometimes called champions); and (8) performance measures.

Figure 10.1 frames these components in the context of three questions: What should we do? How do we do it? How are we doing? The chart reveals the strategic planning process as a disciplined system. Ideally, over time, the process would move full circle. Unfortunately, in the experience of the University of North Carolina School of Government’s Strategic Public Leadership Initiative, few counties and municipalities have completed the full model. Instead, various components have been adopted, such as visioning, goal setting, and performance measurement, but for several reasons, the dots have not been connected into a more systematic approach.

Figure 10.1 Strategic Public Leadership: Setting Priorities and Getting Results

Source: UNC School of Government. Reprinted with permission.
According to Bryson (2010), there are a number of reasons for the spread of strategic planning across the United States since the early 1980s. Particularly for smaller jurisdictions, strategic planning may only occur under coercion—for example, when small jurisdictions are required to prepare plans as a condition of receiving grants-in-aid. In larger jurisdictions, there may be normative pressures for strategic planning to be considered necessary for innovation or to be a top-performing organization because it is identified as a best practice by practitioners and academics. In other cases, strategic planning may be seen as a fad or “the flavor of the year” reform. In these situations, it is understandable why some managers and elected officials resist going beyond minimum compliance responses, have a “check the box” mentality, and let the plan sit on the shelf and not drive decision making. Even though Bryson concludes that strategic planning is “here to stay,” 
Table 10.2
 indicates some of the challenges identified by researchers that make it difficult to make strategic planning real.
These challenges are formidable, but managers can overcome them. Bryson and others argue that governments should make the journey from strategic planning to strategic management. This involves the ongoing integration of strategic planning across an organization—including performance measurement and management, evaluation, budgeting, and human capital management—in to fulfill its mission, meet mandates and expectations, and create public value. As will be considered next, it involves collecting and analyzing data on a regular basis and routinely conducting “Groundhog Day,” where the management team and elected officials review plan execution, identify problems, and celebrate progress. Because strategic management is ongoing, continuous organizational learning takes place as the organization becomes more future ready by identifying possible scenarios, taking steps to adapt to its changing environment, and responding to feedback on its implementation strategies and actions.

Table 10.2 Common Strategic Planning Challenges

Unwillingness to engage stakeholders and incorporate their feedback and expectations

Including too many goals or goals that are too vague

Failing to prioritize goals and identify crosscutting goals

Lowering the bar on SMART objectives due to fear of reprisals

Confusing outputs with outcomes

Failing to cross-walk budget requests to long-term goals and short-term objectives

Using inappropriate performance data

Underestimating financial, human, and other resources needed to achieve goals

Holding administrators responsible for objectives that depend on conditions beyond their agency’s control

Unwillingness to seek feedback, assess implementation, and take corrective actions

Sources: Bryson, 2010, p. S263; Poister, 2010, p. S247.

Performance Measurement
Performance measurement has become an increasingly important component of strategic planning. Once an organization decides where it wants to go in terms of goals and the related strategies, measuring progress using the SMART objectives or performance targets tells administrators, elected officials, and stakeholders how much progress is being made, what corrective actions are required to stay on course, how much more work needs to be done, and what resources will be needed. It also enables an organization to compare itself to its peers and to benchmark itself against them or to the best in field, region, or country. Organizations can also benchmark against themselves from year to year. According to Steven Cohen and William Eimicke (1998):
The benchmarking process has value even if the desired improvements are not achieved. By continuously seeking to identify the best-in-class and to duplicate or surpass their performance, an organization shapes its culture and behavior with a strong spirit of competitiveness, pride, confidence, energy, and a drive to always do better. (p. 75)
As such, performance measures are a tool to use to help an organization understand, manage, and improve what it does. In addition, accountability is strengthened, employees are empowered by having clear goals and targets to manage and measure, and teams and teamwork are encouraged.
At the national level, two reforms gave performance measurement a substantial boost. In the executive branch, the Program Assessment Rating Tool (PART) was adopted as a key component of President George W. Bush’s management agenda as a successor to the NPR. Red, yellow, and green “Stoplight Scores” were assigned by the Office of Management and Budget (OMB) to agencies based on their success in advancing and achieving outcome-based performance targets. Although a latecomer to management reform, in 1993, Congress passed the GPRA, which required federal agencies and funding recipients to prepare strategic plans covering a three- to five-year time period and containing goals, objectives, and measures. In 2010, Congress passed the GPRA Modernization Act, which directed agencies to prepare a four-year plan and submit it to Congress one year after a President is elected or reelected, using common definitions of such terms as goals and objectives. Under the new law, the OMB is required to conduct annual strategic reviews of agency performance relative to their plans, develop cross-agency priority goals, and designate a lead federal official for each (Kamensky, 2013, p. 8).
Despite these breakthroughs, an assessment of experience by Beryl Radin concluded that these legislative and executive branch performance measurement systems have created conflict between the branches, fragmentation of responsibilities with congressional authorizing and appropriating committees, and variations of roles and responsibilities within federal departments and agencies. Radin concluded that there is very little evidence that performance information has been actually used in decision making by federal-level public managers and that they were “basically invisible” in congressional authorization and appropriations processes (2011, p. S130).
As with strategic planning, Radin’s research underscores that there are formidable challenges associated with making performance measurement real to decision makers. First, just as “strategic planning is defined and implemented in vastly different ways across organizations,” taking a one-size-fits-all approach to the collection of performance information ignores the diversity of agencies and programs (Poister, Pitts, & Edwards, 2010, p. 539).
As James Q. Wilson pointed out in his classic book Bureaucracy (1989), the work of “production organizations” such as state and local transportation, welfare, and public works departments is much easier to measure in terms of both outputs and outcomes than that of “coping organizations” such as schools and police departments, where neither outputs nor outcomes can be readily observed or connected and multiple factors influence performance. For instance, is there a linkage between the number of traffic tickets written (output) and the reduction of traffic accidents, injuries, and fatalities (outcome) (pp. 159–163, 168–171)? Grant programs such as the Community Development Block Grant, in which the federal government provides a sum of funds to accomplish a broadly defined purpose but allows local recipients to exercise considerable flexibility and discretion in setting priorities and determining uses of federal monies, also create performance-monitoring challenges compared to those having more national direction, specificity, and administrative oversight (Radin, 2006).
Second, with respect to the quantity and quality of data, when GPRA’s reporting requirements were enacted, some critics said that they did not consider widely varying databases, information collection systems, and analytical capabilities at the state and local levels. Martin O’Malley’s leadership and commitment to data and analytics while mayor of Baltimore (CitiStat) and governor of Maryland (State Stat) received national recognition. Both Citi Stat and State Stat are versions of Performance Stat. Originally called Comp Stat (a system created in the 1990s by the New York City police department to reduce crime), today’s Performance Stat programs are used more broadly in public agencies. These systems use a combination of data analytics, performance measurement, and accountability to improve government performance. However, across the country, the performance measurement spotlight did not shine widely or brightly on other elected leaders who must have -in if such efforts are to succeed. As Robert Behn’s examination of 21 municipal Performance Stat programs across the country discovered, the job of elected and administrative leaders involves much more than collecting statistics. -in entails the following:
A jurisdiction or agency is employing a Performance Stat leadership strategy if, in an effort to achieve specific public purposes, its leadership team persists in holding an ongoing series of regular, frequent, integrated meetings during which the chief executive and/or the principal members of the chief executive’s leadership team plus the director (and the top managers) of different subunits use current data to analyze specific, previously defined aspects of each unit’s recent performance; to provide feedback on recent progress compared with targets; to follow-up on previous decisions and commitments to produce results; to examine and learn from each unit’s efforts to improve performance; to identify and solve performance-deficit problems; and to set and achieve the next performance targets. (Behn, 2014, p. 1)
Personnel cutbacks that were made in the wake of the Great Recession thinned the ranks of statisticians and analysts who were charged with gathering and reporting performance information. Funds to train staff in performance measurement methods and best practices had dried up in many jurisdictions. While local economies are rebounding, filling vacancies in analyst and evaluator positions ranks far below police, firefighter, teacher, public works, and librarian positions.
Third, if not carefully managed, performance measurement systems can take on a “blame and shame” nature. An example here is the PART’s “Stoplight Scores.” Programs were rated effective, moderately effective, adequate, ineffective, and results not demonstrated in terms of four factors—their purpose and design, strategic planning, program management, and results (Radin, 2011, p. S129). These scores were used by the OMB to help determine budget recommendations. Agency personnel who disagreed with the rating could appeal to the OMB’s political executives—not an attractive option. This approach raises the accountability stakes, but it also creates distrust and conflict between careerists and political appointees as well as between managers and elected officials. In fact, there may be understandable reasons why an agency or program has failed to meet its strategic objectives and performance targets—such as unrealistic goals, insufficient funding, short implementation time lines, and inadequate staff—that might not be brought to light.
Where this “gotcha” mentality persists, a typical bureaucratic response is to game the measures to satisfy departmental leadership. Donald Kettl believes that “all performance measures are gamed” (2014, p. 16) and asserts that measures create incentives that may be dysfunctional if punishment rather than progress is the focus. In the federal government, the effort of the Department of Veterans Affairs senior managers to disguise wait times for appointments in VA hospitals is illustrative. And in New York City’s police department, which launched a crime statistics collection and analysis system (CompStat) to much fanfare, senior management’s pressure to drive down crime rates led officers to cook the books:
When a victim reported a theft, for example, officers would use eBay and other websites to find a lower value for the stolen item than the value the victim claimed. If they could drive the amount down to less than $1,000, it would become a misdemeanor instead of a felony, which are reported to the FBI [Federal Bureau of Investigation] as major crimes. Officers also claimed they were under pressure to convince victims not to report crimes at all or to adjust the facts to allow the police to downgrade the charge. (Kettl, 2014, pp. 16–17)
The PART experience shows that performance ratings are not objective or politically neutral. Studies have found that during the Bush administration, programs that were established under Republican presidents received more favorable scores than those created under Democratic presidents. Programs that reflected more liberal values such as equity, resource redistribution, and environmental protection also received low ratings. In this context, the wariness of careerists about PART and desire to game the system are understandable (Lavertu & Moynihan, 2012, pp. 527–529). PART was discontinued when the Obama administration took office.
So while more performance-related information is being collected at all governmental levels, there are concerns that it is not being used, or used as intended, by public administrators and elected officials. Research has found, for instance, that federal managers consider both PART and GPRA “primarily as a compliance exercise rather than an opportunity to generate purposeful performance information use” (Moynihan, 2013, p. 502). To be an effective tool, especially for local strategic plans and websites, managers will need to find ways to routinely include this data and analysis in program assessments, budget requests, personnel appraisals, and day-to-day administration. As with strategic planning, managers must work to embed performance management in their organizational culture.
Program Evaluation
A frequent comment on the current public administration scene is “what gets measured gets done.” For many years, information collected through regular evaluations of programs and services in management studies, consultant reports, and employee surveys, among other instruments, has been used by managers to examine their effectiveness and to identify ways to improve performance. Having performance measurement systems in place that are more than just compliance exercises proves critical to evaluation success.
Program evaluation is one of the most commonly used tools. A mid-1990s survey of municipalities between 25,000 and one million population found that 70% of the respondents had used program evaluation citywide or in a specific area (Poister & Streib, 1994). Whether the research is quantitative or qualitative, contemporary information technology enables managers to evaluate how well their jurisdiction’s programs and services are working on several fronts, including stakeholder assessments (e.g., citizen surveys), efficiency and effectiveness indicators (e.g., using geographic information systems to track neighborhood trash collections), and benchmark comparisons against peers using dashboards (e.g., water and sewer fees, police and fire response times, and K–12 graduation or dropout rates).
Growing interest in evidence-based decision making, open data, and analytics should bolster traditional program evaluation efforts and make local government operations more transparent and accountable. Of course, these tools entail investments in information technology, professional staff, and consultants that may be difficult for smaller and less affluent local governments to make. One promising development is the emphasis that most master of public administration and master of public policy programs now place on developing the data collection and analytical competencies of their graduates, who could fill entry-level positions in budget or evaluation units or the manager’s office.
Budgeting for Results
Budget reforms also have been common instruments of administrative reform, although many of the initiatives have been short-lived and achieved fad or gimmick status. Proposed systems since PPBS have a variety of names: zero-based budgeting, program budgeting, budgeting for results, performance-based budgeting, responsibility-centered budgeting, and budgeting for outcomes. From a toolbox perspective, their common purpose is to move away from object-based line-item decisions focusing on incremental adjustments of the base. While these conventional approaches offer relative simplicity and are embraced by elected officials, they assume that the local government operates on autopilot in terms of its strategic direction, needs, and priorities. According to David Osborne and Peter Hutchinson (2004):
The true outrage is that traditional budget cutting focuses entirely on what we cut (or hide), while ignoring what we keep. It does little to improve the effectiveness of the 85 or 90 percent of public dollars that continue to be spent. It never broaches the question of how to maximize the value of the tax dollars we collect. (p. 5)
At the core of budget reform, whatever terminology is used, is an effort to change the rules of the budget game by aligning resources with results. The process involves systematically connecting plans and programs with budget requests at the outset and then monitoring, evaluating, and providing feedback on results. Performance information is an integral part of budget development, execution, and evaluation (Barnett & Atteberry, 2007).
Such cross-walking can take time and consume staff resources and cause the eyes of elected officials to glaze over. But the payoffs in terms of showing elected officials the returns on the investment of taxpayer dollars and enabling them to ask good questions to staff regarding the impact of proposed expenditures are worthwhile. Focusing on these questions raises the conversation during budget season to the policy and program levels and helps keep policy makers from getting lost in the weeds and preoccupied with small line-item requests. Doing so will prove challenging to managers, as governing body members are often inclined to focus on budget details that they understand and are comfortable with and to micromanage staff proposals that are on the voter’s radar screen instead of looking at the long-term big picture. An important lesson from past efforts is that it makes little sense to introduce a new budget system into the executive branch without consulting with legislators and encouraging them to use it.
One facilitating factor is the growing use of local websites to showcase how taxpayer dollars are spent through the budget, indicate current budget priorities and emerging needs, track spending trends, and compare budget allocations against peer jurisdictions. A wealth of data on local budgets and operations is available for managers to use to package information and communicate in ways that are understandable to elected officials, citizens, and other stakeholders.
Another benefit of budgeting for results systems is that the groundwork is in place for a more informed dialogue among elected officials and with citizens during the annual budget process. Performance information can be used to identify and justify both budget increases and cuts. Many local governments are required under state statute or local ordinance to conduct a public hearing on the proposed budget. Of course, budget work sessions are open to the public and media, but they rarely attract crowds. While hearings may not be an ideal way to convey information about the budget or to give useful feedback to decision makers, there are steps that managers can take to help promote an informed dialogue. These include making available a “citizen’s budget” highlighting major or sensitive initiatives and related rationales and expected outcomes, cross-walking strategic goals and objectives to budget requests, and holding hearings in neighborhood facilities such as community centers as well as at the county courthouse or city hall.
Succession Planning
A fifth tool for managers that is gaining attention is succession planning. The focus here is on human capital (not plans, budgets, and evaluations), and it is driven by the so-called silver tsunami. Depending on the jurisdiction, a substantial number of the baby boomer generation are making retirement plans. For example, as indicated in Chapter 5, ICMA has reported that approximately 60% of the managers currently serving communities will be eligible for retirement within 10 years. The potential size of the retiree exodus and resulting amount of lost institutional knowledge and experience have raised serious concerns about who will fill the local management pipeline. This is especially the case in view of the growing popularity of the nonprofit management specialization in graduate programs.
Municipal and county managers have been encouraged by their professional associations to prepare succession plans for key departmental and management team personnel. Such plans identify the knowledge, skills, and abilities that will be necessary to fill a particular position as well as possible internal candidates who could be groomed to move into vacated positions. The latter sometimes involves a detailed management training and leadership development curriculum as well as job rotations in key positions in the organization. Where succession planning works, there is a smooth transition of personnel out of and into key positions.
Despite the anticipated critical need for talent and the organizational performance benefits, succession planning is not widely practiced. Some organizations simply do not have the resources to develop a succession planning system or have too few management-potential employees to make it realistic. There is also a concern that investing money in developing employees may be wasted if the new training makes them more marketable to other organizations. Some managers prefer to bring in fresh perspectives and new faces from outside the organization rather than to rely on internal candidates who might be wedded to the current culture and ways of doing business. Elected officials may not be supportive of a long-range succession plan, so they may be unwilling to agree in advance to groom individuals for senior management positions, especially where turnover occurs on the governing board and elected official–professional staff trust levels are not high. A legal hurdle also may exist. Civil service requirements, grant conditions, and human resource office practices may mandate that recruitment for all positions be wide open and that no favoritism should be shown toward particular candidates.
THE JOURNEY FROM PLANNING AND MEASUREMENT TO MANAGEMENT
Earlier in this chapter, Bryson (2010) was quoted with respect to the importance of moving from strategic planning to strategic management. Even though each of the five tools highlighted may be underutilized and its potential not fully realized, looking at each one’s application in terms of a more integrated or comprehensive framework may pay dividends. As Bryson (2010) notes regarding the move toward strategic management, “the move includes integrating strategic planning, budgeting, human resource management, and performance measurement and management” (p. S262). In their review of the state of public strategic management research, John Bryson, Frances Berry, and Kaifeng Yang (2010) observe:
Strategic management theory now emphasizes the development and alignment of an organization’s mission, mandates, strategies, and operations, along with major strategic initiatives such as new policies, programs, or projects, while also paying careful attention to stakeholders seen as claimants on the organization’s attention, resources, or outputs, or as affected by that output. (p. 496)
In these respects, all five of the instruments in the manager’s toolbox are well aligned.
Turning to performance management, Theodore Poister (2010) distinguishes it from strategic management as follows: “Whereas strategic management focuses on taking actions now to position the organization to move into the future, performance management is largely concerned with managing ongoing programs and operations at present” (p. S251). Poister points out that large, complex organizations use a wide variety of performance measurements and systems at different management levels, different units, and different program areas. Performance measurement and performance management systems are more encompassing than strategic planning and management. Harry Hatry (2002), an Urban Institute program evaluation expert, has asserted that performance can improve in the absence of strategic planning, even though it would lead to an emphasis on the immediate situation and diminish attention to where the organization should be going in the future.
Performance management lags behind performance measurement in terms of adoption, and it should not be assumed that more performance measurement leads to better performance management. Poister cites a 2008 report by the Government Performance Project—a joint venture by the Pew Charitable Trusts, Syracuse University, and Governing and Government Executive magazines—that graded states on their attention to management issues such as human capital, financial management, and information technology. The results indicated that 24 states received a C or D grade on their effort to generate performance information and use it to support decision making. Only six states received an A (Poister, 2010, p. S250). The Government Performance Project also examined 75 large counties and municipalities and found that only eight merited an A or A- in the “managing for results” category (Ammons, Liston, & Jones, 2013, pp. 172–173). The grades could have been worse except for the efforts of public managers in some states to hasten work on their management reforms in anticipation of the public reporting of grades.
A survey of 72 county and municipal governments having a reputation for good performance management found that most (49%) focused on systems for collecting, compiling, and improving performance data, with another 24% indicating that their emphasis was limited to upgrading performance measures. Only 28% connected it with a managerial philosophy. The latter localities collected more information and used it to improve operations and services (Ammons et al., 2013, p. 175). The authors concluded:
City and county governments that embrace performance management as their management philosophy may enjoy advantages in the pursuit of particular types of benefits over those regarding performance management as a system or tool, and both of these sets of governments are likely to anticipate and receive more benefits from performance management than municipalities and counties that are focused simply on upgrading their performance measures. (p. 178)
Among the reasons for this spotty record are the low priority elected officials give to administrative oversight, except when there is a crisis. Governing bodies often lack political will to make decisions and incur costs necessary to achieve substantial performance gains. And, recalling the straightjacket effects of rules identified by Reinventing Government advocates, public administrators sometimes lack flexibility and discretion to manage programs to improve performance.
An example of how strategic planning and performance budgeting linkages can atrophy if not adequately supported is Alabama’s SMART initiative that was launched in 2004. The acronym stood for “specific results, measurable key goals, accountable to stakeholders, responsive to customers and, finally, transparent to everyone” (Barrett & Greene, 2012, p. 68). Partly due to worsening fiscal conditions, by late 2011, state agencies were no longer required to submit their budget requests connected with SMART, although they continued to plan and set goals. Lack of legislator -in, uneven support from departmental and agency leadership, outmoded technology, and disconnects between annual goals and statewide strategies were among the reasons for the demise of performance budgeting.
The state of Washington provides another interesting example. In 2007, the Council of State Governments gave its first Governance Transformation Award to the state’s Government Management Accountability and Performance (GMAP) system that had been put in place two years earlier. Among the many illustrations of how processes were streamlined and response times were improved was Child Protective Services, which acted on 69% of referrals within 24 hours in 2005 and rose to 90% by 2007. GMAP was a proud accomplishment of Governor Christine Gregoire’s administration, but when she convened a meeting to assess the impact of the six years of program experience, the feedback was eye-opening. According to Wendy Korthuis-Smith, GMAP’s director:
Some of the directors felt like the measures weren’t relevant anymore but that they couldn’t or shouldn’t change them. . . . Some saw the GMAP meetings with the governor as “dog and pony shows.” . . . The system we’d built didn’t feel flexible and nimble. . . . There was too much focus on polishing presentations, when what we really wanted were cycles of experimentation, improvement, and results. (Buntin, 2016, p. 28)
GMAP was becoming “just another stale compliance regime” (Buntin, 2016, p. 28).
This is not to say that managers should stay on the sidelines in the struggle to move to the next level of organizational planning and performance. Table 10.3 indicates a number of managerial levers that could be pulled to steer organizations in this direction.

Table 10.3 Levers to Encourage Strategic Performance Management

Tracking Implementation Progress by Monitoring Performance Measures

Assessing and adjusting performance data in strategy review sessions to ensure that appropriate performance metrics are being used

Cross-walking programmatic and budgetary proposals, requests, and initiatives to strategic plans and communicating this information to elected officials

Aligning budget requests and manager’s work plans with strategic priorities

Incorporating progress on goal and objective accomplishment into administrator appraisals and compensation decisions

Communicating progress to stakeholders and engaging them in SOAR (strengths, opportunities, aspirations, results) assessments and program performance reviews

Promoting vision, mission, and goal recognition with employees throughout the organization by using signage, newsletters, websites, and award ceremonies

An important, and unanswered, question is, “So what?” Have local governments that use these tools performed more effectively than those that have not done so? Have the tools bolstered relationships between managers, elected officials, and citizen stakeholders? Empirical evidence is lacking or, at best, mixed. Benedict Jimenez conducted research to determine whether municipalities that had comprehensive strategic plans in place were better able to adjust to the economic crisis during the Great Recession and minimize their budget deficits. He found that “managers from cities with comprehensive strategic planning are more confident of the fiscal outlooks of their governments amidst a generally worsening local fiscal climate” (2012, p. 597). This confidence, while subjective, can inspire a sense of control and capacity to act at a time of declining morale, confused direction, and decision paralysis. While it might be hypothesized that local governments operating under reformed forms of government—such as the council–manager system featuring professionally trained managers, nonpartisan and at-large election systems, and unified decision making—were more efficient, there was no confirming evidence that structure affected fiscal policy and that such reforms impacted taxing and spending levels (Morgan & Pelissero, 1980). Clearly, more evidence-based research is needed here.
USING THE TOOLS AS MANAGER
The journey to better local government performance could prove difficult, lengthy, and frustrating in many organizations. Immediate problems and pressing needs often trump long-range thinking, planning, and acting. The attention span of local elected officials is relatively short as they seek to satisfy constituents’ current concerns and bolster their reelection prospects; indeed, their definition of the future might well be the next election, not the time frame of a strategic plan. Competing values such as efficiency, effectiveness, and equity sometimes produce political decisions that do not reflect managerial recommendations and are satisfactory but not optimal. The wide diversity of public organizations and need for collaborative approaches to problem solving complicates planning, execution, and accountability. And of course, while looking to the future strategically and acting on the basis of forecasts and trends are important, as the Great Recession reminds us, there are always unforeseen events and unintended consequences.
Yet, according to David Ammons (2002), despite their limitations, using these tools in the decision-making process has benefits:
Thoughtful analysis normally elevates the quality of debate on an issue. Important aspects of a decision and its likely ramifications become more apparent. Sometimes the analysis is so compelling that its recommendations are adopted in full; sometimes recommendations are modified to be more politically acceptable, but are nevertheless adopted with most characteristics intact. Even when its recommendations are rejected, careful analysis permits decision makers to proceed with eyes wide open, fully aware of the likely consequences of a particular decision. (p. 222)
For local governments, there has been progress on the strategic planning, performance, and budgeting fronts in a relatively short time period. While challenges remain, these tools are here to stay. More and better information is now available to policy makers and managers that can help them adapt to changing environments, improve decisions and outcomes, and create greater public value for their work. The key challenge is to embed these tools into the organizational cultures and management systems of public agencies and into the mindsets of elected officials.
Local governments need both strategic management and performance management. They must be nimble in terms of both identifying and dealing with compelling current issues and needs while remaining focused on long-term goals and adapting to a rapidly changing environment. Using the tools highlighted in this chapter will enable managers to successfully embark on and complete this journey.
REFERENCES
Ammons, D. N. (2002). Tools for decision making: A practical guide for local government. Washington, DC: CQ Press.
Ammons, D. N., Liston, E. G., & Jones, J. A. (2013). Performance management purpose, executive engagement, and reported benefits among leading local governments. State and Local Government Review, 45(3), 172–179.
Barnett, C. C., & Atteberry, D. (2007). Your budget: From axe to aim. Public Management, 89(5), 6–12.
Barrett, K., & Greene, R. (2012). SMART is stumped. Governing, 26(1), 68–70.
Behn, R. (2014). Bob Behn’s performance leadership report. Washington, DC: Brookings Institution Press.
Brudney, J. L., Hebert, F. T., & Wright, D. S. (1999). Reinventing government in the American states: Measuring and explaining administrative reform. Public Administration Review, 59(1), 19–30.
Bryson, J. M. (2010). The future of public and nonprofit strategic planning in the United States. Public Administration Review, 70(Supplement 1), S255–S264.
Bryson, J. M., Berry, F. S., & Yang, K. (2010). The state of public strategic management research: A selective literature review and set of future directions. The American Review of Public Administration, 40(5), 495–521.
Buntin, J. (2016). The reinventors: 25 years after first “reinventing government” states are still tinkering with how to get it right. Governing, 29(12), 26–33.
Cohen, S., & Eimicke, W. (1998). Tools for innovators: Creative strategies for managing public sector organizations. San Francisco, CA: Jossey-Bass Publishers.
Denhardt, J. V., & Denhardt, R. B. (2011). The new public service: Serving, not steering (3rd ed.). Armonk, NY: M.E. Sharpe.
Gulick, L., & Urwick, L. (Eds.). (1937). Papers on the science of administration. New York, NY: Institute of Public Administration.
Hatry, H. (2002). Performance measurement: Fashions and fallacies. Public Performance and Management Review, 25(4), 352–358.
Holliman, A. E., & Bouchard, M. (2015). The use of management by objectives in municipalities: Still alive? Review of Public Administration and Management, 3, 1. Retrieved March 24, 2017, from https://www.omicsonline.com/open-access/the-use-of-management-by-objectives-in-municipalities-still-alive-2315-7844-1000150.pdf

Jimenez, B. S. (2012). Strategic planning and the fiscal performance of city governments during the Great Recession. The American Review of Public Administration, 43(S), 581–601.
Kamensky, J. M. (2013). The strategic plans are coming! PA Times, 36(5), 8, 11.
Kavanagh, S. (2011). Zero-base budgeting: Modern experiences and current perspectives. Chicago, IL: Government Finance Officers Association.
Kettl, D. F. (1998). Reinventing government: A fifth-year report card. Washington, DC: The Brookings Institution.
Kettl, D. F. (2014). Gaming the system. Governing, 27(11), 16–17.
Kettl, D. F. (2015). Politics of the administrative process (6th ed.). Washington, DC: SAGE/CQ Press.
Lavertu, S., & Moynihan, D. P. (2012). Agency political ideology and reform implementation: Performance management in the Bush administration. Journal of Public Administration Research and Theory, 23(3), 521–549.
Morgan, D. R., & Pelissero, J. P. (1980). Urban policy: Does political structure matter? American Political Science Review, 74(4), 999–1006.
Moynihan, D. P. (2013). Advancing the empirical study of performance management: What we learned from the program assessment rating tool. The American Review of Public Administration, 43(5), 502.
National Performance Review. (1993). From red tape to results: Creating a government that works better & costs less. Washington, DC: U.S. Government Printing Office.
Olsen, J. B., & Eadie, D. C. (1982). The game plan: Governance with foresight. Washington, DC: The Council of State Planning Agencies.
Osborne, D., & Gaebler, T. (1992). Reinventing government: How the entrepreneurial spirit is transforming the public sector from schoolhouse to statehouse, city hall to the Pentagon. Reading, MA: Addison-Wesley Publishing Company, Inc.
Osborne, D., & Hutchinson, P. (2004). The price of government: Getting the results we need in an age of permanent fiscal crisis. New York, NY: Basic Books.
Osborne, D., & Plastrik, P. (1997). Banishing bureaucracy: The five strategies for reinventing government. Reading, MA: Addison-Wesley Publishing Company, Inc.
Poister, T. H. (2010). The future of strategic planning in the public sector: Linking strategic management and performance. Public Administration Review, 70(Supplement 1), S246–S254.
Poister, T. H., Pitts, D. W., & Edwards, L. H. (2010). Strategic management research in the public sector: A review, synthesis, and future directions. The American Review of Public Administration, 40(5), 522–545.
Poister, T. H., & Streib, G. D. (1994). Municipal management tools from 1976 to 1993: An overview and update. Public Productivity & Management Review, 18(2), 115–125.
Radin, B. A. (2006). Challenging the performance movement: Accountability, complexity, and democratic values. Washington, DC: Georgetown University Press.
Radin, B. A. (2011). Federalist no 71: Can the federal government be held accountable for performance? Public Administration Review, 71(Supplement 1), S128–S133.
Wilson, J. Q. (1989). Bureaucracy: What government agencies do and why they do it. New York, NY: Basic Books.
RESOURCE LIST/TO EXPLORE FURTHER
Books/Articles
Altman, L., Henderson, M., & Mamlin, V. (2017). Strategic planning for elected officials: Setting priorities. Chapel Hill: University of North Carolina School of Government.

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