[Senate Hearing 109-927]
[From the U.S. Government Publishing Office]


                                                        S. Hrg. 109-927
 
    CRITICAL MISSION: ASSESSING SPIRAL 1.1 OF THE NATIONAL SECURITY 
                            PERSONNEL SYSTEM

=======================================================================




                                HEARING

                               before the

                              COMMITTEE ON
               HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS
                          UNITED STATES SENATE


                       ONE HUNDRED NINTH CONGRESS

                             SECOND SESSION


                               __________

                           SEPTEMBER 20, 2006

                               __________

        Available via http://www.access.gpo.gov/congress/senate

                       Printed for the use of the
        Committee on Homeland Security and Governmental Affairs



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        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

                   SUSAN M. COLLINS, Maine, Chairman
TED STEVENS, Alaska                  JOSEPH I. LIEBERMAN, Connecticut
GEORGE V. VOINOVICH, Ohio            CARL LEVIN, Michigan
NORM COLEMAN, Minnesota              DANIEL K. AKAKA, Hawaii
TOM COBURN, Oklahoma                 THOMAS R. CARPER, Delaware
LINCOLN D. CHAFEE, Rhode Island      MARK DAYTON, Minnesota
ROBERT F. BENNETT, Utah              FRANK LAUTENBERG, New Jersey
PETE V. DOMENICI, New Mexico         MARK PRYOR, Arkansas
JOHN W. WARNER, Virginia

            Jennifer H. Hemingway, Professional Staff Member
   Theresa Prych, Professional Staff Member, Oversight of Government 
                              Management,
    the Federal Workforce, and the District of Columbia Subcommittee
             Michael L. Alexander, Minority Staff Director
               Lawrence B. Novey, Minority Senior Counsel
     Jennifer L. Tyree, Minority Counsel, Oversight of Government 
                              Management,
    the Federal Workforce, and the District of Columbia Subcommittee
                  Trina Driessnack Tyrer, Chief Clerk


                            C O N T E N T S

                                 ------                                
Opening statements:
                                                                   Page
    Senator Collins..............................................     1
    Senator Voinovich............................................     3

                               WITNESSES
                     Wednesday, September 20, 2006

Hon. Gordon England, Deputy Secretary, U.S. Department of 
  Defense, accompanied by Mary Lacey, NSPS Program Executive 
  Officer, U.S. Department of Defense............................     2
Hon. Linda M. Springer, Director, U.S. Office of Personnel 
  Management.....................................................     7
Lieutenant General Terry L. Gabreski, Vice Commander, Air Force 
  Materiel Command, U.S. Air Force...............................     9

                     Alphabetical List of Witnesses

England, Hon. Gordon:
    Testimony....................................................     2
    Prepared statement...........................................    23
Gabreski, Lieutenant General Terry L.:
    Testimony....................................................     9
    Prepared statement...........................................    33
Springer, Hon. Linda M.:
    Testimony....................................................     7
    Prepared statement...........................................    27

                                APPENDIX

Responses to post-hearing questions for the Record:
    Mr. England..................................................    41
    Ms. Springer.................................................    54
    General Gabreski.............................................    56
Darryl Perkinson, National President, Federal Managers 
  Association, prepared statement................................    58
United Department of Defense Workers Coalition (UDWC), prepared 
  statement......................................................    62


                 CRITICAL MISSION: ASSESSING SPIRAL 1.1



                        OF THE NATIONAL SECURITY



                            PERSONNEL SYSTEM

                              ----------                              


                     WEDNESDAY, SEPTEMBER 20, 2006

                                       U.S. Senate,
                           Committee on Homeland Security  
                                  and Governmental Affairs,
                                                    Washington, DC.
    The Committee met, pursuant to notice, at 2:33 p.m., in 
room SD-342, Dirksen Senate Office Building, Hon. Susan M. 
Collins, Chairman of the Committee, presiding.
    Present: Senators Collins and Voinovich.

             OPENING STATEMENT OF CHAIRMAN COLLINS

    Chairman Collins. Good afternoon. Today, the Committee 
holds its third hearing to examine the design and 
implementation of the National Security Personnel System. We 
will focus on the conversion of approximately 11,000 employees 
that began earlier this year.
    The pay-for-performance systems underway at the Departments 
of Defense and Homeland Security represent the most significant 
change in Federal employees' supervision and compensation 
methods since the General Schedule was introduced in 1949. When 
fully implemented, the new pay-for-performance systems will 
cover approximately one-half of the Federal civilian workforce.
    Debate on the National Security Personnel System for the 
Department of Defense's civilian workforce started in 2003, 
when the Department initially submitted a proposal that many of 
us believed went too far and failed to provide important 
provisions to protect good employees. Since then, considerable 
progress has been made. I want to commend Secretary England for 
his continued commitment during the past 3 years to ensuring 
that the new system is credible and that it appropriately 
reflects congressional intent to reward high performers and 
avoid unfair consequences. I am very impressed that Secretary 
England has stayed personally involved in this project, despite 
having the tremendous responsibility of being Deputy Secretary.
    Despite the Department's efforts to provide a robust 
training program for its employees and their supervisors, I 
continue to hear concerns from employees and their 
representatives that show their lack of confidence in the new 
system.
    I have had, for example, employees from the Portsmouth 
Naval Shipyard in Kittery, Maine, express to me concerns about 
whether their managers will be fair in their evaluations and 
whether they will know how to do their evaluations. There is 
not a resistance to evaluation per se. In fact, most employees 
tell me they welcome a good evaluation system where their pay 
is tied to their performance. But many of them say to me, quite 
frankly, ``I do not think my manager is going to be able to do 
this in a way that is fair.'' I believe we have a real 
challenge to build confidence in the new system.
    Secretary England has previously testified that, ``A key to 
the success of NSPS is to ensure that employees perceive the 
system as fair with trust between employees and supervisors.'' 
I think that really sums up the challenge before us. I look 
forward to learning how the Department is building that trust 
that is absolutely critical to achieve a successful 
implementation of the new program. If there is not employee 
buy-in, if employees do not view NSPS as a fair system that 
will truly reward good performers, then the Department is going 
to be met with continued resistance and opposition. After all, 
the real test of NSPS begins next month, when Spiral 1.1 
employees receive their first written performance evaluations 
from their supervisors.
    Implementation of the new system will, of course, require 
honest, accurate, and actionable evaluation and will continue 
to be dependent, as I have indicated, on good management, 
proper execution, and effective training. Each of those factors 
requires adequate resources. I am, therefore, also interested 
in hearing what kinds of improvements are planned to ensure 
that future employee conversions are properly funded so that 
managers and supervisors can make the proper judgment calls.
    Whether the system set forth in the final regulation will 
achieve the Committee's goal of helping the Department recruit, 
reward, and retain a highly skilled workforce and ensuring that 
employees are recognized for their contributions to the mission 
remains to be seen. As the Department moves forward, this 
Committee will continue to scrutinize the system and to assist 
to determine if it meets the goal of supporting the best 
possible Federal workforce. And that really is the goal that 
unites all of us.
    I know that Senator Voinovich, who asked me to conduct this 
hearing, is very eager to hear the Secretary's remarks. It is 
my understanding that he is on the way, so I am going to ask 
that the Secretary proceed with his statement, and with your 
permission, when Senator Voinovich arrives, I will interrupt 
you and defer to him for his opening comments.
    Secretary England, we are delighted to have you here today.

  TESTIMONY OF HON. GORDON ENGLAND,\1\ DEPUTY SECRETARY, U.S. 
DEPARTMENT OF DEFENSE, ACCOMPANIED BY MARY LACEY, NSPS PROGRAM 
         EXECUTIVE OFFICER, U.S. DEPARTMENT OF DEFENSE

    Mr. England. Senator Collins, thank you, Madam Chairman, 
and it is a delight to be here. I do thank you for the 
opportunity to be here. I know you are extraordinarily busy in 
the Senate as you get to the end of the session, so it is very 
gracious of you, frankly, to hold this hearing today. Thank you 
for your comments about my personal involvement, and let me 
reciprocate. We appreciate your personal involvement because it 
has been most helpful, and we do appreciate your steadfast 
support and your help and assistance and suggestions as we have 
gone along. So I do thank you.
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. England appears in the Appendix 
on page 23.
---------------------------------------------------------------------------
    It is a pleasure to be here today with Linda Springer. She 
is our very close partner at OPM. And here is Senator 
Voinovich, so maybe I will----
    Chairman Collins. We will break, and I will ask you to 
withhold.
    Senator Voinovich, you have perfect timing. You did not 
have to listen to my opening statement, but you did not miss 
Secretary England's. I would say that was good timing. So, 
Senator Voinovich, I was explaining that the idea for this 
hearing originated with you and that we have worked very 
closely on a variety of human capital challenges, and I would 
like to give you an opportunity to make some opening comments 
before the Secretary proceeds.

             OPENING STATEMENT OF SENATOR VOINOVICH

    Senator Voinovich. Thank you.
    Thank you for holding this hearing. As you know, this 
Committee has had an ongoing interest in the National Security 
Personnel System. If it was not for the Chairman of the 
Committee and her leadership in the conference committee, NSPS 
would look very different. While the legislation establishing 
NSPS did not come through this Committee, we have been 
conducting oversight of it ever since, haven't we?
    I have often said that the changes underway at the 
Department are far reaching and will impact Federal workforce 
reform across the entire Executive Branch. It is the 
responsibility of Congress and this Committee to continue its 
oversight to ensure the implementation is progressing in a 
positive manner and that employees are benefiting from the 
changes embodied in NSPS.
    I am glad that Mr. England and Ms. Springer are here today 
to testify before the Committee. I appreciate the fact that we 
have had such good cooperation with you.
    Madam Chairman, I know that issuing the regulations to 
establish the National Security Personnel System was not an 
easy task, and it took longer than we thought. The 
implementation process is going to be even more formidable if 
we are to institutionalize NSPS at the Department of Defense. 
And failure is not an option.
    I want to go back to March 2001, when I Chaired the 
Subcommittee hearing titled ``National Security Implications of 
the Human Capital Crisis.'' The panel of witnesses that day 
included former Defense Secretary James Schlesinger, who was a 
member of the U.S. Commission on National Security in the 21st 
Century. At that time Secretary Schlesinger said, ``As it 
enters the 21st Century, the United States finds itself on the 
brink of an unprecedented crisis of competence in government. 
The maintenance of American power in the world depends on the 
quality of U.S. Government personnel, civil and military, at 
all levels. We must take immediate action in the personnel area 
to ensure the United States can meet future challenges. It is 
the Commission's view that fixing the personnel problem is a 
precondition for fixing virtually everything else that needs 
repair in the institutional edifice of the U.S. national 
security policy.''
    And so far this Congress and the Committee, including my 
Subcommittee, have held four hearings on the National Security 
Personnel System. The most recent was a field hearing where we 
examined the training for preparation of Spiral 1.1. We looked 
at what they were doing at Pearl Harbor and other military 
bases, and we were very impressed.
    In addition, my staff has met with the leaders of various 
components in Ohio who are preparing for implementation of 
Spiral 1.2. While approximately 100 DOD civilian employees in 
Ohio were converted to Spiral 1.1, over 3,800 Ohioans will be 
converted during Spiral 1.2. Department-wide, I think the total 
converting in Spiral 1.2 is about 60,000 more people, starting 
in October. That is next month.
    During this past year, I have been struck by the excitement 
and enthusiasm I have seen in senior career staff as they 
prepare for NSPS implementation. In conversations with these 
individuals, I know they understand the challenge before them, 
and I am committed to ensuring that they have the necessary 
support and resources. The Chairman and I worry about the 
Department having the resources to support NSPS. Once DOD 
converts the next 60,000, are the budgets of the agencies going 
to be sufficient to train these folks to make this program 
successful?
    So today I restate my commitment to work with the 
Department, and make sure, Secretary England, that they have 
the money to get the job done. Too often around here--and the 
Chairman and I have talked about this--we keep asking agencies 
to do more. We give them more responsibilities, and we do not 
give them more money to get the job done. If we are going to be 
successful with this, the Department has to have the resources.
    I would hope that you let the Director of the Office of 
Management and Budget--Rob Portman--know what you need because 
without the support this will not be successful, it will not be 
institutionalized. We cannot afford to go back. Thank you.
    Chairman Collins. Thank you, Senator. Secretary England.
    Mr. England. Senator Voinovich, I was just commenting as 
you came in. The Chairman was gracious enough to thank me for 
staying personally involved, and I was thanking the Senator, 
and I also thank you because you have both been very supportive 
and extraordinarily helpful, and we enjoy and appreciate 
working with you on this very important issue.
    It is a pleasure to be here today with Linda Springer, our 
partner from OPM, also Mary Lacey, our Program Executive 
Officer, and also this afternoon Lieutenant General Terry 
Gabreski, who is from Wright-Patterson Air Force Base and so 
can discuss some on-the-ground real events with you today.
    Before I proceed, I just want to give a very brief 
thumbnail, but let me first address the issue of budgets. We do 
not have a budget issue. The components have the money they 
need to do the training to the level they need to do it, and if 
they need more for training, they will have more money. This 
program is vitally important for the Department of Defense. We 
know it is vitally important, and we are fully funding all 
aspects of this program. And that is a personal commitment. At 
the end of the day, I actually get to sign off on these budgets 
and approve them and make sure that projects are fully funded. 
I can assure you this program has been and will continue to be 
fully funded for training our people. So a commitment on the 
budget, Senator, is not going to be an issue. And if there is 
an issue, I will tell you, and you can look me directly in the 
eye, but I can tell you we are not going to have a funding 
issue in terms of training on this program.
    I do want to comment--I would like to just give you a 
thumbnail sketch because I know time is short and there is a 
lot in the Senate going on. But let me say that we are making 
significant progress, and I have been personally very pleased 
by the feedback. We have been in Spiral 1.1, as you commented, 
Madam Chairman. We have 11,000 personnel in 12 different 
organizations in Spiral 1.1. And, Senator Voinovich, you are 
correct, we start next month. Between October and January, we 
will have 66,000 more people join NSPS. So we have a 
significant increase, and there are people from around the 
world in this next group of people, 66,000. They are from 
organizations around the world. I can tell you, supervisors are 
engaged, employees are engaged. We have open channels of 
communications. Our employees know what is expected. And I am 
delighted to tell you that the feedback--what people tell me, 
that this is the first time they have ever seen a large-scale 
DOD training effort focused on the leadership and our 
employees. This is directed to our civilian workforce and our 
military workforce who manages civilian employees. And so this 
is about improving skills, particularly improving the skills of 
our management personnel. And they are very pleased that this 
is happening.
    The other feedback that is very positive is people are 
talking about the mission of the Department. That is, they go 
in and talk to their supervisor. And as you know, I have felt 
strongly about this from day one. The great benefit is we can 
take our national security objectives through the Secretary of 
Defense and literally down to ``the deck plate'' and trace that 
through expectations, job objectives, and then be able to 
evaluate job objectives tied to our mission, and for the first 
time, I believe, widespread--people across the Department now 
in Spiral 1.1 and getting ready for 1.2, are talking about the 
mission and how we accomplish it and how we link job 
performance to the mission that we are trying to accomplish. So 
I am very pleased.
    Now, I will tell you, we do have a hiccup or two in the 
program. One of the hiccups, of course, is we do have a 
district court decision, and the district court enjoined, that 
is, prevented us from implementing some of the labor relations, 
specifically the adverse actions, appeals, and the labor 
relations portion itself of NSPS. So on three of the issues, we 
were enjoined by the court. We expect to have a decision 
sometime early next year, hopefully--it depends on the courts, 
but our expectation is early next year we will have a decision 
on that part of the case.
    In the meantime, we are proceeding. And, by the way, I will 
tell you there is some degree of frustration. It takes a while 
to do this. We get held up by the courts and stop and start. On 
the other hand, my view is, literally, God bless America, this 
is a case where the Legislative Branch passed a law, the 
Executive Branch is implementing it, it goes to the courts, and 
ultimately there will be an arbiter, did we do it the way that 
the Legislative Branch intended. And so that is the way the 
system works, and in the end we will end up with the right 
answer, and we will continue to proceed to implement the 
system.
    In the meantime, of course, we are hopeful that the courts 
will rule and resolve all this. We may, depending on what the 
rulings of the courts are, we may come back for some 
clarification before the Congress next year, specifically as 
the program has been delayed. This has not been dictated by the 
calendar. We always said this was going to be whatever the 
schedule, the appropriate timelines were. But, we do have built 
into the law an end date of 2009. So if we are held up long 
periods of time, we may indeed come back and ask for an 
extension of the 2009 date. I don't know if we will, but, 
again, just so you will not be surprised if we do next year, 
that is a possibility.
    The other thing that we may come back to you for is 
clarification regarding national level bargaining. Both the 
unions and ourselves would like to do national level 
bargaining. Unfortunately, it has been tied in now to the labor 
relations parts of NSPS, and now we are precluded from doing 
national level bargaining. We would like to separate that. We 
do not think that was ever the intent. So depending, again, on 
how the court case comes out, we may ask for clarification in 
that arena next time. But we will continue to be event driven. 
We are adapting as we go; that is, we are learning as we go, we 
are modifying as we go. The whole objective is to end up with 
an environment for our people to excel, for our Department to 
excel. We have not lost sight of what the end objective of this 
program is.
    We are committed to dialogue. We are doing that with all 
the stakeholders, and we have had a lot of communication and 
training, and I will let Mary Lacey talk more about that, and 
also Linda Springer.
    So I just want to tell you, we are committed. We have 
applied the resources to the program. We are making progress--
not as fast as we would like, but, frankly, we are going to 
have this program a long time. So even if it takes us a little 
bit longer, it takes us a little bit longer. But we will get to 
the end, and when we get there, it will be a very effective 
program. I remain convinced that this will be a very effective 
program for our employees, for our Department, and for the 
country.
    And so I thank you for your support, and I thank all the 
people who have worked so hard. We have been at this now 
literally for years. A lot of people have spent a lot of time, 
energy, and commitment, and I thank them for that commitment 
and time and energy on behalf of our employees and our 
Department, and I thank this Committee.
    Chairman Collins. Thank you very much, Mr. Secretary.
    I would now like to introduce the Director of the Office of 
Personnel Management, Linda Springer.
    Ms. Springer, we are very glad to have you here today, and 
I would ask that you proceed with your statement.

 TESTIMONY OF HON. LINDA M. SPRINGER,\1\ DIRECTOR, U.S. OFFICE 
                    OF PERSONNEL MANAGEMENT

    Ms. Springer. Thank you, Madam Chairman and Senator 
Voinovich. It is a privilege to testify and give you an update 
on OPM's role with respect to the NSPS implementation. OPM has 
been very deeply involved, and our collaboration with DOD has 
been productive. It would not have occurred without DOD's 
leadership, especially the senior leadership, and particularly 
Secretary England.
---------------------------------------------------------------------------
    \1\ The prepared statement of Ms. Springer appears in the Appendix 
on page 27.
---------------------------------------------------------------------------
    The result of this collaboration is a new human resources 
system at the Department of Defense that will support our 
national security goals and objectives but at the same time 
respect the individuals that create those results. It will 
value their performance, their leadership, their commitment to 
public service, and really ensure accountability at all levels 
while remaining a competitive and cost-effective system.
    In November, I testified before you that OPM would be 
involved and would support the Department of Defense in every 
way to make sure that it was an effective implementation. In my 
view, the Spiral 1.1 conversion has met those objectives, and 
OPM has played a very important role in that success.
    OPM leaders participate on a weekly basis, as well as in ad 
hoc and other important meetings, with the DOD project team 
leadership to make sure that we are involved in all aspects of 
the policy guidance with respect to the implementation. Our 
legal staff actively consults with the DOD leadership's legal 
staff to ensure that we have met not only statutory 
requirements but also judicial restraints on NSPS.
    Our policy experts assist in the development of the 
implementing issuances.
    Our compensation experts were very heavily involved in the 
substance of the issuances to make sure that we have a credible 
pay-for-performance system that rewards individual performance 
and also allows for recognition of organizational results in 
developing those rewards.
    Our performance management experts were involved in the 
development of the performance management aspects of the 
implementing issuances to make sure that managers and 
supervisors are held accountable for effectively managing the 
performance of the people for whom they are responsible and 
also that merit systems principles are not overlooked.
    Our classification experts reviewed procedures for 
classifying positions to ensure that the system was streamlined 
and simplified, but not at the expense of employee rights.
    Our staffing experts worked with their DOD counterparts to 
develop procedures for implementing such features as category 
rating, public notice requirements, and veterans' preference 
requirements.
    All of these OPM experts--legal, policy, compensation, 
performance management, classification, and staffing--really 
covering the full breadth and scope of the personnel range, 
spent many months working with the Department of Defense in 
developing implementing issuances. Now our attention has turned 
to evaluating how well the NSPS is working, and with a 
particular emphasis on training. We have gone through all of 
the online training to evaluate whether or not it is in plain 
English, whether it is understandable, whether it is 
comprehensive, and the OPM experts are convinced that it is. We 
are going to be spending time at the on-site instructor-led 
training starting with the early October sessions. We will 
actually participate, and we will have seats in the training 
sessions dedicated for OPM observers.
    There are three different formal evaluations that are 
planned or already underway. The first is a review of the 
performance management system that will allow the Secretary to 
determine whether or not by law the NSPS system should extend 
beyond the original 300,000 employees that were in the purview 
of the system. That assessment will particularly focus on the 
Spiral 1.1 conversion all the way through the rating process 
and the ultimate payout, as you mentioned, that would happen in 
January of 2007. OPM will be involved in the assessment 
process.
    I have included the development of the criteria for 
determining whether or not that assessment is effective in the 
OPM Strategic and Operational Plan so that OPM's senior leaders 
are being held accountable for making sure that they are 
involved in the setting of those assessment criteria and that 
they really meet our standards as well as DOD's.
    The second review is an ongoing program evaluation that DOD 
is conducting, and OPM staff meet regularly with the DOD staff 
on their evaluation. That is a routine evaluation.
    The third one is really an OPM initiative. Under our own 
independent statutory authority, OPM will be conducting an 
evaluation of the effectiveness of NSPS. That evaluation will 
be very comprehensive. We will look at all levels--managers, 
supervisors, employees, other executives--to make sure that as 
they spiral into NSPS, the effective training, as well as all 
the other aspects of the implementation, are happening as we 
would expect and have met our standards. So that third 
independent review is one that will be completed by May 1 of 
next year, and we will be happy to report to you on the results 
of that assessment.
    In sum, though, we have worked very closely with DOD on 
implementation, and we are now very much engaged and looking 
forward to our assessment efforts. And we will continue to be 
involved in that way. We appreciate from the very beginning the 
Senate and this Committee's work to make sure that OPM does 
have an important role, and we take that very seriously, Madam 
Chairman, and we look forward to continuing to let you know how 
we are doing.
    But, in short, I would say the NSPS is providing the 
flexibilities that DOD needs to really be responsive to the 
ever-increasing and changing national security issues, which 
they need to meet on behalf of the American people.
    So I thank you for the opportunity to testify today, and I 
look forward to any questions that you might have.
    Chairman Collins. Thank you very much, Director Springer. I 
smiled at your closing comments because as you are well aware, 
Senator Voinovich and I both felt very strongly about the need 
for OPM to be involved at every step of the way to share its 
considerable expertise. I know that Secretary England always 
welcomed that involvement as well. That was not, however, true 
of everyone who was involved in this process.
    I am now very pleased to introduce Lieutenant General Terry 
Gabreski. General Gabreski is the Vice Commander of the Air 
Force Materiel Command and is stationed at Wright-Patterson Air 
Force Base, an installation that is near and dear to my 
colleague's heart. She is responsible for the oversight of NSPS 
training and implementation within the Air Force Materiel 
Command and also oversaw the conversion of 2,400 employees at 
Tinker Air Force Base to NSPS earlier this year.
    General Gabreski, we are very pleased to have you here to 
share your personal experiences.

  TESTIMONY OF LIEUTENANT GENERAL TERRY L. GABRESKI,\1\ VICE 
     COMMANDER, AIR FORCE MATERIEL COMMAND, U.S. AIR FORCE

    General Gabreski. Good afternoon, Chairman Collins and 
Senator Voinovich. I, too, want to echo an appreciation for you 
all taking time to focus on this important subject for us, not 
just in the Department but in Air Force Materiel Command. This 
afternoon I would like to briefly share with you some examples 
of how we successfully are implementing NSPS Spiral 1.1 out at 
Tinker Air Force Base in Oklahoma and give you some examples of 
how we dress for success out there.
---------------------------------------------------------------------------
    \1\ The prepared statement of General Gabreski appears in the 
Appendix on page 33.
---------------------------------------------------------------------------
    In particular, we worked extremely hard during the planning 
phases of NSPS to ensure that we emphasize training as well as 
communication. We continue to work those two specific areas, 
and we think that those investments are paying off. The one 
thing, I think you would agree, that separates our Armed Forces 
from any other in the world is our magnificent people, and 
certainly one of the things that makes our people great is the 
premium that we place on training.
    So just like the training we provide for any operational 
mission, it is important that we ensure that our folks are 
trained and the emphasis is placed on training in regard to 
NSPS.
    We have taken great care in training both our civilian and 
our military personnel in the specifics of NSPS implementation, 
as well as the soft-skill sorts of training, such as how to 
manage change in organizations. This training sets the stage 
for our continued success as we continue to deploy NSPS.
    Now, hand in hand with the training focus is our focus on 
communication. The Air Force has made clear that communication 
is critical to NSPS as we continue to implement it. We have 
used a variety of methods within Air Force Materiel Command and 
at Tinker Air Force Base specifically. Our four-star commander 
has relayed the importance of NSPS in communications that he 
gives to our installations and to our individual employees. 
Each Air Force Major Air Command conducted ``Spread the Word'' 
briefings in which general officers traveled to the 
installations in their major commands underscoring the 
importance of this program.
    One of the key messages that was relayed during these 
briefings to our people is that NSPS is much more than just a 
new personnel system. It is a commander responsibility, and it 
must be led from the top. So at Tinker, as at other AFMC bases, 
commanders have informed their personnel about NSPS through 
commanders calls, weekly newspaper articles, informative 
websites, even down to the electronic marquees on the 
installations and talking about important facts about NSPS.
    Now, we have had the opportunity to put this training and 
communication to the test at Tinker as the first Air Force 
installation to deploy NSPS. Twenty-four hundred non-bargaining 
employees converted there in April of this year, but well 
before that implementation, we stood up at Tinker an NSPS 
program office. We have applied a programmatic approach to NSPS 
implementation, and we have charged that program office with 
the responsibility for every aspect of NSPS deployment.
    We placed in charge of that program one of our high-
performing employees who is a non-personnelist, a person who is 
an expert in our business and someone who can show the 
importance of NSPS as not just a new personnel system.
    I visited Tinker last week personally, and I saw firsthand 
how their vigorous training and communication is paying off as 
I spoke to both employees and managers who have converted. The 
employees have experienced a clearer communication of 
performance expectations as well as a stronger linkage to the 
mission.
    Additionally, NSPS has provided to the leadership at Tinker 
the flexibility and responsiveness to carry out their mission. 
There have been challenges as well as lessons learned at 
Tinker, and we continue to share those across the Air Force as 
well as the Department.
    NSPS provides our commanders the agile human resources 
system they need to succeed in today's environment. As you 
heard from Secretary England, senior leadership in the 
Department is committed to the success of this program, and I 
appreciate and thank you for your strong support.
    So I look forward to answering any of the questions you 
might have on our deployment of NSPS in Air Force Materiel 
Command and at Tinker Air Force Base specifically. Thank you.
    Chairman Collins. Thank you very much, General Gabreski.
    A key person in the unveiling and implementation of the 
program has been Mary Lacey, the Program Executive Officer for 
the National Security Personnel System. Ms. Lacey, I'd like to 
give you the opportunity for any comments you would like to 
make before we go to questions.
    Ms. Lacey. Thank you for having us here today.
    Chairman Collins. Thank you.
    Secretary England, the Department has indicated that the 
protection of pay pool funding would be addressed in several 
different ways. For example, the Department has stated that it 
would mandate the minimum composition and expenditure of pay 
pool funds. In addition, certain senior-level officials would 
be required to certify that the funds allocated to the 
performance-based pay pool would be used only for that purpose.
    I would like to ask you how the Department is going to 
ensure that, in times of tight budgets, managers do not use 
money that is intended to support the pay-for-performance 
program for other purposes. One of the fears that I hear from 
Department employees is that the pay-for-performance system is 
not really to reward outstanding employees with additional 
compensation, but rather, it is a means to reduce overall 
personnel costs.
    What is your response to that?
    Mr. England. Senator, I frankly believe we are fixing a 
problem that used to exist in that regard. It was brought to my 
attention when we started that it was not unusual in the past 
that if somebody was short on funds, they needed to fix a 
building, they fixed the building and, therefore, cut down on 
the pay pool for employees. So I believe that was a problem 
that existed, frankly, before we implemented this system. It is 
not a problem that exists now. We have strict controls in 
place. We identify what the pay percentages are, what the 
performance pay pool allotments are. We approve those so they 
are controlled. People do not have flexibility to move that 
money around. We work with the Comptroller to make sure that is 
the case.
    So under NSPS, I would say that we have a much stricter 
process in place in terms of controlling funds that they do not 
drift out of this system, and I am confident--we worked this 
very hard. That was a commitment when you passed the 
legislation and we started implementing this that we would make 
sure we had controls in place, and we do. So we approve the 
amount of money, we approve what goes in the bonus pools, and 
we control those within the Department. And I can tell you, 
that money is not going to migrate, and I do not believe it can 
migrate the way we have had the Comptroller set this up. And, 
Ms. Lacey, you may comment yourself because we are actually 
implementing this now as part of our mock pay pools to make 
sure we have those controls in place.
    Ms. Lacey, if you want to add to that?
    Chairman Collins. Ms. Lacey.
    Ms. Lacey. We have built that into policy, which has the 
force of internal regulations in the Department of Defense. So 
those floors for the amount of money available have been set in 
policy already. The money is set in place in the budgets. It 
will be there for the January payouts for the employees, and we 
will continue to do that year in and year out. It is 
institutionalized.
    Chairman Collins. So, Secretary England, just to close out 
this issue for the Federal employees who are watching today or 
who may read about this hearing, there is no intention on the 
part of the Department to spend less on overall pay under NSPS 
than under the old system. That is not a goal of the system.
    Mr. England. That is not a goal. As a matter of fact, as I 
recall, Senator, I believe we are actually precluded by law 
from spending less. So, we will spend the money allocated. It 
will not be less than it would have otherwise been. I think in 
some cases it will be more because of the pay-for-performance 
aspect. It will not be less. More importantly, the money is 
being protected to make sure that it actually goes to pay pools 
for employees. So employees can feel very confident that under 
NSPS there is a defined pot of money for employee raises and 
for pay-for-performance.
    Chairman Collins. Thank you. The reason I wanted to spend 
some time on that issue is because pay-for-performance has a 
hollow ring to it if, in fact, you cannot get additional 
compensation because the money is not there.
    Mr. England. Right.
    Chairman Collins. And that is why I think that is a really 
important point.
    Mr. England. You are absolutely right, Senator.
    Chairman Collins. General Gabreski, I am very interested in 
your observations as someone who has overseen the conversion of 
some 2,400 employees. What do you think needs to be improved? 
What kind of feedback can you give us, can you give the 
Secretary, Ms. Lacey, and Director Springer?
    General Gabreski. When I was out at Tinker last week, I got 
some very up close and personal feedback from the folks that 
have converted, and several lessons come through loud and 
clear. One of them is that they really appreciated the quality 
and the quantity of training, and, if anything, they are 
wanting to continue that level of training to keep their skills 
sharp. But as important, as they go through these mock pay 
pools, the fact that writing objectives between supervisors and 
employees is harder than they thought it would be. So they are 
wanting specifically to improve their skills in that area so 
that everyone can be successful in the end, that they properly 
sit down with employees, outline the objectives and their 
expectations, and that they follow the process through in the 
best way.
    So those are really the two takeaways I had from last 
week's interface and observations as we have deployed this.
    Chairman Collins. Ms. Springer, the General Accountability 
Office has constantly emphasized the importance of an ongoing 
review which incorporates lessons learned during 
implementation. How is OPM making sure that changes such as the 
ones that were just identified by General Gabreski are fed back 
into the system so that the next conversion can learn from the 
past conversion?
    Ms. Springer. The first step is to make sure that OPM is 
involved, that we are actually sitting in on training courses, 
which we are doing, and that we are actually going in and using 
the online tools and training. Then, when we meet with 
individuals and interview them, as we will be doing during our 
assessment and independent evaluation, we can actually have a 
working knowledge of what it is that they are using. As a 
result of that level of involvement, when the individuals with 
whom we meet come back and say, well, this part of it needs to 
be enhanced or this part of it was more or less valuable to us, 
we already have an understanding and are able to give direction 
on how to incorporate those findings. It is not as if we will 
be in a learning mode. In many ways, our actual experience will 
help us to validate independently what we are being told.
    The notion and the observation that the objective setting 
is a key part of this is no surprise to OPM. It is similar to 
evaluations we have done of demo projects. In fact, we are 
making sure that the questions that we ask and the assessment 
metrics that we look at are very closely aligned with what we 
have learned are important from evaluating demo projects. There 
is a very close relationship. And that is why it was so 
important to make sure that these objectives were put in 
writing because that written exercise forces people to come to 
grips with a clear articulation of measurable goals. So that is 
not an unexpected observation.
    Chairman Collins. Thank you.
    Ms. Lacey, are there examples of changes that either have 
been made or will be made to Spiral 1.2 as a result of employee 
feedback from Spiral 1.1?
    Ms. Lacey. Yes, there are several. Let me start with the 
aperture for the conversion. With Spiral 1.1, we converted 
everybody on virtually the same day, over a period of 3 or 4 
days, the personnelists working to do all the electronic 
conversions. That meant everybody had to be prepared and 
trained up by the same day.
    For Spiral 1.2, we have opened that aperture, opened that 
window, to do the conversion over a 4-month period. This makes 
it a lot less stressful for us to actually get people trained 
up and ready to go. And so we have done that. It also enables 
the commanders to make the final decision ``my organization is 
ready,'' so they do not have that pressure of having to go by a 
certain date.
    On the training, every single training class has feedback 
built right into it. We have two different kinds of feedback. 
We have the usual how did the instructor do in teaching you the 
material, but we also have a pre-test and a post-test to get a 
sense of how much learning did this employee actually get while 
they were sitting through this course. And we are using that 
feedback to continuously upgrade the training material so that 
we can ensure that employees have the opportunity to learn as 
deeply and richly as possible.
    So we have made those changes all along, even through some 
of the Spiral 1.2 training that has been going on. We have 
added several training modules and vehicles to the toolkit. We 
have recently put up online some Web-based training, Camtasia 
training for folks so that they can get a better understanding 
of the automated tools that are available on employee and 
managers' desktops. We are adding an additional module to what 
we call our NSPS 101 to put more information in about pay pools 
and the performance management process. This certainly has 
caught the attention of our employees, and they want to know 
more. So we are adding more details there.
    We also have provided additional ad hoc courses on writing 
performance objectives for commands and organizations that 
wanted a graduate school program, if you will, as they went 
through that process.
    So we will continue to listen to that feedback and continue 
to do those things to ensure that we have the best experience.
    Chairman Collins. Thank you. Senator Voinovich.
    Senator Voinovich. I would like to continue discussing how 
pay adjustments work.
    Congress passes a pay increase across the board for 
everyone, right? Then that money is allocated to the various 
departments, so they are going to get X number of dollars. In 
Spiral 1.1, which will be the first group to be paid on the 
basis of performance, you take that pool of workers and then 
you allocate X number of dollars differently. Is that right?
    Ms. Lacey. The law provides for us to do that, but from a 
policy point of view, we have chosen not to for this payout. 
For Spiral 1.1's payout, any across-the-board raises that 
Congress passes, we will make structural adjustments to 
employees' pay so they will receive that.
    Senator Voinovich. So the first Spiral will get their 
automatic pay increase, a cost-of-living increase, and then 
have extra money for those whose performances are higher. 
Correct?
    Ms. Lacey. Correct.
    Senator Voinovich. OK. So, in effect, you are spending more 
money than you would ordinarily spend.
    Ms. Lacey. Not quite. The source of that other money is 
money that we are no longer spending that used to be automatic, 
the within-grade pay raises that folks got. Career ladder 
promotions that went away because the bands----
    Senator Voinovich. OK. So the extra money would come from 
where?
    Ms. Lacey. Step increases, that we would have otherwise----
    Senator Voinovich. Step increases.
    Ms. Lacey. Right.
    Senator Voinovich. The step increases are gone, so 
employees will get an across-the-board increase, then you take 
the funds that would have funded step increases to fund 
performance increases. Is that right?
    Ms. Lacey. Correct, and across the Department, the white-
collar portion of the workforce, the GS/GM, acquisition demo 
equivalents, that number is actually 2.26 percent of salaries. 
That is what we have historically spent on within-grades that 
we are no longer going to be spending.
    Senator Voinovich. And there are 11,000 trained to do 
performance evaluations.
    Ms. Lacey. Yes.
    Senator Voinovich. Just to be sure I really understand 
this, of the 11,000 only a certain number of them are managers 
that are going to do performance evaluations. But you have gone 
beyond the managers in training employees to familiarize 
everyone with how NSPS is going to work.
    So 11,000 have been trained on NSPS, but the jacket, the 
heavy jacket is on the managers to write performance 
evaluations. Is that right?
    Ms. Lacey. That is correct.
    Mr. England. Yes, Senator, that is well said. And this is a 
critical part of the program. You have heard a few people say 
that. You have alluded to it. This heavy training for managers 
and supervisors to be able to sit down with employees, 
literally write out objectives, come to agreement, and make 
sure those objectives track with what the objectives of the 
Department are so that we link these throughout the 
organization and that they are in sufficient clarity that you 
can actually then measure against the objective because at the 
end of the day it is pay-for-performance, so you have to be 
able to measure performance. And this is the very crucial part 
of the program.
    And, Madam Chairman, when we talked earlier about the 
fairness of the system, this is the crux of it, to make sure 
that people understand how to do that.
    Senator Voinovich. Right, but the fact of the matter is 
that the first real snapshot that we are going to have of the 
program is when that is done. When will that take place?
    Mr. England. Well, we have a mock payout this fall, so we 
will have feedback from the mock payout. Now, again, that is 
not a real payout. It is a mock. It is part of the training 
process. But it is just like you go through the whole process, 
get evaluated for the whole thing, but your pay is not 
dependent on that evaluation. So it is called a mock because 
your pay is not going to be dependent on it. We want people to 
go through this process so we can learn ourselves and make sure 
we have it right.
    Senator Voinovich. This is an important part of a 
government-wide reform bill that I have introduced. All of the 
managers would go through the training. This ought to be done 
anyhow just in terms of a management objective. People should 
know how they fit in the organization, what the organization 
wants to accomplish.
    Well, I am interested to see, once that happens, what kind 
of feedback you are going to get.
    General, how do you monitor the folks that you are 
responsible for? Do you hear feedback or have you developed 
metrics that you judge whether NSPS is effective?
    General Gabreski. Absolutely, Senator. We have a variety of 
ways that we monitor how we are deploying and how well we are 
doing. One of them is at the local levels; our installations 
have established various forms of executive steering groups at 
the senior leadership level so that they can, on a routine 
basis, get feedback from pay pool managers, from supervisors, 
from their NSPS program offices. And they use metrics that 
measure how much training has been done versus how much needs 
to be done.
    For instance, at Tinker Air Force Base, they have filled 
17,000 training seats just in getting ready for their 2,400 
folks who went into Spiral 1.1. So at the local level, we 
monitor all of that very closely.
    Senator Voinovich. Do you have some kind of piece of paper 
that you get back, kind of an information sheet that the folks 
that have had the training can offer feedback. In other words, 
anything in writing right now that so you know whether the 
training is working or not?
    General Gabreski. Yes, sir. As Ms. Lacey mentioned, we get 
the feedback at the end of the training, but we also ask--
particularly useful in doing this, in asking for this back, is 
our website, where folks can tell us what they need more of or 
what needs to be done just a little bit better. And because we 
are in the first spiral out there, they are able to actually 
help tweak the system.
    Senator Voinovich. So you have a paper method for employees 
to get back to you, and they get feedback through e-mail.
    General Gabreski. You bet.
    Senator Voinovich. Do you get a lot of that from folks?
    General Gabreski. Yes, sir, we do. Our employees are not 
shy, and the one big takeaway in terms of not being shy that I 
got last week is between the employees and the managers, they 
are actively engaged in working their way through what each 
group has to do to get this thing done properly.
    Senator Voinovich. They are sort of excited about this, 
aren't they?
    General Gabreski. Actually, they are. They really are.
    Senator Voinovich. Yes. Secretary England, when are we 
going to get to the unionized employees?
    Mr. England. Senator, I expect to wait to see what happens 
with the court case because----
    Senator Voinovich. Does the court case preclude you from 
doing pay-for-performance for unionized employees?
    Mr. England. No, it does not. We can do that. But it does 
get a little bit complicated because, you know, pay then gets 
into the labor system, particularly if you have an issue or a 
problem then it goes into labor relations. So it does make it 
somewhat complicated.
    Senator Voinovich. I hate to interrupt you, but would the 
elimination of the step increases be something that might be 
touchy?
    Mr. England. I am not sure that is touchy. I will tell you 
where I have been on this, and folks, sort of our senior group, 
all agree with this, and that is, while the court case is going 
on, we actually do not want to put our employees nor the union 
employees in an uncomfortable position. There is really no rush 
to do this. We have 66,000 people in Spiral 1.2. The court case 
will be determined early next year. So why put people in a 
difficult position?
    Senator Voinovich. The point is that down the road is when 
the unionized employees would be transitioned, in Spiral what?
    Mr. England. One point three, or something.
    Senator Voinovich. So you have time before that to get this 
court case resolved and come back to us.
    Mr. England. You are correct, sir.
    Senator Voinovich. OK. If NSPS is implemented with the non-
unionized employees and the feedback is positive, that will be 
the best thing to allay employees' fears. But I know there will 
be some unhappy people. How successful you are with NSPS will 
have a lot to do with whether it will continue under a new 
administration. They may have a different point of view. That 
is why what you are doing right now has got to be quality. If 
you want to institutionalize NSPS, how well you do is going to 
make the difference for the future of the program.
    Chairman Collins. Thank you, Senator.
    I have no further questions for this panel, just a 
concluding comment for this panel. Do you have additional 
questions?
    Senator Voinovich. I do.
    Chairman Collins. Please feel free to proceed.
    Senator Voinovich. Thank you. Secretary England, you 
mentioned that you may need an extension of the date. What is 
the relevance of that? I am not sure I understand the relevance 
of it.
    Mr. England. Senator, there is a sunset clause that we have 
to have a certified system, and basically we have to have--as I 
recall, the whole system has to be certified and in place by 
the end of 2009.
    Now, as you know, when we started the system, that sounded 
like a long way down the road. But, also, we decided not to 
have a calendar-driven system but an event-driven system. That 
is, we were never going to move to the next phase--your recent 
comments, make absolutely certain we are doing this right and 
employees benefit from it, and we are confident as we go 
forward. Plus the court case has been delaying because it has 
been a bit disruptive to us.
    So at the end of the day, it may be that we may--and, 
again, I am not sure we will. We will wait and see where we are 
next year, but we may end up asking for an extension.
    Senator Voinovich. OK. What does the sunset mean?
    Mr. England. We need to have a certified system of the 
first, I believe, 300,000 people before we are allowed to go 
forward. So it has to be certified before we can go beyond 
300,000 people. That is the certification between ourselves and 
OPM that----
    Senator Voinovich. So when NSPS was authorized, it was 
capped at 300,000 employees initially. You are saying you 
cannot get to 300,000 because, first of all, it took longer to 
develop the regulations, and I frankly think you took a lot of 
time with them. That was good. You are just saying we need more 
time because the whole system has been slowed down. Is that 
right?
    Mr. England. That could indeed be the case. Again, we will 
decide, but we did not want you to be surprised if we came back 
and talked to you about that next year.
    Ms. Lacey. Let me add just a little bit here, sir. The 
specific piece that sunsets, according to the current 
legislation, pertains to our authority to change anything in 
the labor relations world. That is the piece that we are most 
concerned about because the anticipation was by then we would 
have had several years of run time under a new LR system to 
determine was it fair, was it credible, was it working, and if 
it wasn't, it ought to----
    Senator Voinovich. But you will not know because the court 
case still is pending.
    Ms. Lacey. Right.
    Senator Voinovich. You might have to come back and ask for 
an extension as to that portion of the law.
    Mr. England. Right.
    Senator Voinovich. OK. I want to get back again to the 
issue of the training because when I was out and met with the 
folks at Pearl Harbor, many of them said they were able to fold 
training into the current budget. However, they were somewhat 
concerned that when NSPS expands, they would not be able to 
absorb the costs into their regular budget process.
    Now, Mr. Secretary, you said that you were going to be 
watching that? General, you have been doing this with your 
regular budget, haven't you?
    General Gabreski. Yes.
    Senator Voinovich. You have been somehow doing it; there is 
no question about it. We did total quality management in Ohio, 
but we did ultimately have to get some more money for it.
    What is your perspective on how you are going to be able to 
handle that? Are you going to be able to handle the next Spiral 
with the current budget, or are you going to need more 
resources in order to do the job?
    General Gabreski. Senator, we have already allocated in 
fiscal year 2007 the funds that we need to continue into this 
next spiral, and we don't currently see any problem at all, 
just as the Secretary said.
    Senator Voinovich. Mr. Secretary, have you looked at the 
budget for future years to see if they are going to need more 
to get the job done?
    Mr. England. Well, what happens is the services have a 
certain allocation of money, and then they have to fit lots of 
requirements in there, and this is one of the requirements. So 
they prioritize and they juggle, and at the end of the day, 
they make it fit. And our direction to them is you have to do 
NSPS, it is important to the Department, and it gets done.
    Senator Voinovich. Now, I want to make sure that the money 
that you use for other training does not evaporate. We often 
ask an agency to take on new responsibilities and then leave it 
up to the agency to figure out how to fund the program. 
Agencies then end up having things that really need to get done 
but do not because the resources have been put into some other 
area.
    Mr. England. I would expect that we are like all other 
agencies, and we do not have extra money. There are always more 
things you can do. The demand is always greater than the money. 
That is just the nature of every organization. But like the 
nature of every other organization, you prioritize what needs 
to get done, and you decide that this is one of those things we 
need to do, it is important. Ultimately, we are all convinced 
that we will be more efficient and more effective with NSPS, so 
it is an investment. And we just need to invest now so we get 
the benefit for our employees and for the organization later. 
And our management team understands that, Senator, and that is 
the path we are on.
    Senator Voinovich. Well, General, we would like to get 
feedback, and if I do not get it from you, I am going to be out 
visiting your people, and I will get it from them. [Laughter.]
    With NSPS in Ohio, I always like to get out and talk to the 
folks that are involved. I think a couple of my staff members 
were out at Wright-Patterson, weren't they?
    General Gabreski. Yes, sir, just recently, in August.
    Senator Voinovich. Good. Now, I was wondering, what is your 
plan to deal with managers who find they do not want to be in 
this new role? Have you run into that at all? If they do not 
want to do it, have you decided what you are going to do?
    Ms. Lacey. That would not be a surprise to us based on the 
experience we had with all of the other demonstration programs 
over the last 15 or 20 years. Truth be told, when people have 
been put in senior leadership, senior management positions, 
their job is to be a manager. We have changed the rules of the 
game. We understand that. We have several places that have 
already gone through the mock payout process, and managers have 
said, ``I cannot handle this. I am the wrong person. This is 
the wrong job for me,'' and their line management is working 
with them to see about assigning them to other duties--which, 
by the way, is much easier in NSPS than it would have been 
otherwise--so that they can continue to make meaningful 
contributions to the organizations.
    Truth be told, though, we may not be able to find 
equivalent senior-level positions, non-managerial positions for 
every individual, but we----
    Senator Voinovich. So you might have to say to somebody, 
``I know you do not want to do this, but we do not have a 
different job for you?''
    Ms. Lacey. No. I think the answer would be, ``We do not 
have a different job for you that is not a manager's job.'' We 
would take the managerial duties away. We may not be able to 
place them in their perfect job right away at their current 
salary.
    Senator Voinovich. But the point is that you expect that 
might happen.
    Ms. Lacey. We expect that might happen. In fact, it has 
happened, and we have organizations that are working with line 
managers as we speak.
    I will also say, though, sir, that there are many folks 
that have gone through this mock payout process, the mock pay 
pool process, the training, and they have said, ``Now that I 
get it, now that I have had the training, now that I have had 
the conversations, it is not as scary to me today as it was 
anticipating it 6 months ago.'' So that training and 
retraining, which is built into our program, is very important 
as well. A little bit of knowledge takes a lot of the fear 
away.
    Senator Voinovich. General, could you share with me how 
long it is going to take for a manager to do a complete 
performance evaluation?
    General Gabreski. I would tell you that after I chatted 
with the managers specifically out at Tinker, the fact that the 
training, in conjunction with the pay pool, kind of completes 
the cycle, just as Ms. Lacey said, that is really part and 
parcel of their job as supervisors and managers. So in the 
future, that will be part of their jobs. But now, as they are 
doing the training, they are getting that comfort level. And I 
would tell you it is not just the managers. It is the employees 
in terms of getting feedback, which is something different than 
they have had before, having to sit down face to face and 
eyeball to eyeball----
    Senator Voinovich. Do you have any idea of how long it 
would probably take to conduct a performance appraisal?
    For example, a manager sits down with an employee to 
discuss the written performance appraisal. By the way, is that 
going to be uniform throughout the system?
    General Gabreski. Well, actually, the way it works is the 
training that they have had and that we have been doing has 
been going on for about a year and a half.
    Senator Voinovich. But the document that you are going to 
use, is that uniform throughout the system?
    General Gabreski. Yes, it is.
    Senator Voinovich. Yes. And have you gotten any feedback in 
the training process as to whether people think that the format 
is a good instrument to do the evaluation? Have you discussed 
that one yet?
    General Gabreski. We have both sides of the coin. Once they 
get used to it and they are familiar with it and comfortable 
with it, they are going, OK, now I get it. But as you go into 
it, it is a little bit scary, but once you start doing it, it 
is a matter of the training and the on-the-job training.
    Senator Voinovich. One of the things that is really 
important is the instrument you are using. It is going to be 
uniform, but does it really help get the job done? Is that 
something you already had, or have you worked with a 
consultant?
    Ms. Lacey. Well, sir, if I can, let me answer that 
question. This is built into the Defense Civilian Personnel 
System tool that we currently have. We have a single integrated 
database for all of our civilian personnel information in the 
Department of Defense. That particular system has some 
functionality in it for doing performance appraisals. It is 
used in the private sector. It is an Oracle-based product that 
we have modified to include the NSPS performance standard 
system. And that is now available at the desktop to all 
employees and supervisors as they transition into Spiral----
    Senator Voinovich. So they can see it?
    Ms. Lacey. They can see it. They can make modifications.
    Senator Voinovich. And as you go through this, if somebody 
feels there is something that needs to be changed, there are 
ways to do that? It is really important that employees feel 
comfortable that the tool that you are using is fair.
    Ms. Lacey. Yes.
    Senator Voinovich. It must capture the things that really 
are necessary to do the job.
    Ms. Lacey. In fact, I am actually changing the tool as we 
speak. Based on the preliminary results from the mock payouts, 
they said, ``We need more characters that we can put in our 
self-assessments.'' So we are making that change so it will be 
ready for the final payouts this fall.
    Senator Voinovich. OK.
    Mr. England. Senator, if I can make one comment, too, just 
for clarity, because the objective is not to sit down at the 
beginning with the employee and arrive at objectives and 
criteria, then at the end of the year sit down again. The 
objective is to work with the employee throughout the year so--
--
    Senator Voinovich. Yes, but the point is you have to have 
the employee involved at the beginning.
    Mr. England. Right.
    Senator Voinovich. A good performance evaluation is one 
that you do not wait a year to do. As you go through the year, 
people should hear constant feedback, so when it is the end of 
the year, employees have a pretty good idea of how they are 
doing.
    Chairman Collins. It should not be a surprise.
    Mr. England. That is my point.
    Senator Voinovich. Good.
    Chairman Collins. Exactly.
    Mr. England. Exactly my point. By the end of the year----
    Senator Voinovich. I am all for that.
    Mr. England. Right.
    Senator Voinovich. It is unfortunate Mr. Perkinson is not 
here, and we ought to talk to him to see how he is looking at 
the system.
    One last thing, I really think it is important that you 
spend a lot of time collecting feedback from folks about 
whether or not they think NSPS is fair or not. Some will not be 
happy, but they need to know their supervisors are doing it 
fairly, that it is not subjective. The biggest concern we are 
going to hear from the unions is that this is arbitrary. How 
are you going to guarantee that it is being implemented the way 
it should be to deal with some concerns in that area?
    Chairman Collins. Senator Voinovich, before the witnesses 
respond to that excellent question, I am going to have to 
leave, and so I am going to turn the hearing over to you.
    Senator Voinovich. Well, this is the last question, but 
thank you. Thanks for staying.
    Chairman Collins. I will allow you to finish.
    Senator Voinovich. If she had not been willing to hold this 
hearing, you might not be here. [Laughter.]
    Chairman Collins. I apologize to our witnesses. I am 
involved in the negotiations on four bills right now that I am 
trying to complete. And I hope you will keep my friend busy for 
a long time because chemical security is one of those bills. 
[Laughter.]
    Senator Voinovich. And I want to talk to you about sunset.
    Chairman Collins. I had a feeling that you did.
    But I did want to place in the record the testimony of 
Darryl Perkinson, the National President of the Federal 
Managers Association, who has had an unexpected event arise 
that precludes him from being here today.\1\
---------------------------------------------------------------------------
    \1\ The prepared statement of Mr. Perkinson appears in the Appendix 
on page 58.
---------------------------------------------------------------------------
    I want to close my comments by citing for the record his 
conclusion. Mr. Perkinson says, ``Education and training are 
easing many concerns and providing initial calm to anxious 
managers and supervisors. Four and a half months into the new 
system, this is encouraging, but we have a long way to go.'' I 
really think that sums up so well where we are, and it also 
indicates how absolutely critical that education and training 
process is to not only ensure that people understand the new 
system and implement it correctly, but also to ease those fears 
and those anxieties.
    I thought that Mr. Perkinson said it very well, and since 
he is not here to say it for himself, I did want to say it 
publicly on his behalf.
    Again, I want to thank Senator Voinovich for all of his 
work on this issue and thank all of our witnesses for being 
here today. Thank you.
    Senator Voinovich, the gavel is yours.
    Senator Voinovich [presiding]. Thank you. Well, it is going 
to be for one second.
    The main thing is to make sure there is in place a 
mechanism for employees to provide feedback. DOD must be able 
to identify a potential problem area before it gets out of 
control.
    Thank you very much. We appreciate it and look forward to 
seeing you after the first pay outs under NSPS.
    Mr. England. Absolutely. Senator, thanks. We do appreciate 
your personal involvement. You have indeed been very helpful to 
this whole process, and we do thank you. It is greatly 
appreciated.
    Senator Voinovich. Well, the reason why I included the 
quote from Schlesinger is I really believe that this is 
fundamental to our national security. It really is.
    Mr. England. Absolutely.
    Senator Voinovich. Again, how well you do in the next 2 
years is going to have a lot to do with whether or not this 
program is going to be successful and become institutionalized. 
That is a big challenge. I think from your perspective that it 
may be the greatest contribution particularly, Mr. Secretary 
and Director, that you can make to your country.
    Mr. England. Absolutely. We agree. Senator, thank you.
    Senator Voinovich. Thank you.
    [Whereupon, at 3:47 p.m., the Committee was adjourned.]
                            A P P E N D I X

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