Managing for Results: Prospects for Effective Implementation of the
Government Performance and Results Act (Testimony, 06/03/97,
GAO/T-GGD-97-113).
GAO discussed the status of the implementation of the Government
Performance and Results Act of 1993 (GPRA) and the prospects for its
effective governmentwide implementation.
GAO noted that: (1) GPRA seeks to shift the focus of federal management
and decisionmaking away from a preoccupation with the activities that
are undertaken, such as grants or inspections made, to a focus on the
results of those activities, such as real gains in employability,
safety, responsiveness, or environmental quality; (2) under GPRA, GAO
was to report to Congress on the Act's implementation; (3) GAO's work
shows that, to this point, the implementation of GPRA has achieved mixed
results, which will lead to highly uneven governmentwide implementation
in the fall of 1997; (4) on the one hand, GAO found that the experiences
of some of the GPRA pilot agencies and related efforts by nonpilot
agencies showed that significant performance improvements were possible
when an agency adopted a disciplined approach to setting
results-oriented goals, measuring its performance, and using performance
information to improve effectiveness; (5) on the other hand, GAO's
survey of a random sample of civilian managers and supervisors in 24
major executive branch agencies found that although there had been
progress over the last 3 years, managers reported that many agencies did
not appear to be well positioned to provide in 1997 an answer to the
fundamental GPRA question of whether programs have produced real
results; (6) GAO found that agencies are confronting five key challenges
that have limited the effective implementation of GPRA; (7) these
challenges include those associated with: (a) establishing clear agency
missions and strategic goals, especially when program efforts are
overlapping or fragmented; (b) measuring performance, particularly when
the federal contribution to a result is difficult to determine; (c)
generating the results-oriented performance information needed to set
goals and assess progress; (d) instilling a results-oriented
organizational culture within agencies; and (e) linking performance
plans to the budget process; (8) addressing some of these challenges
will raise significant policy issues for Congress and the Administration
to consider, some of which will likely be very difficult to resolve; (9)
GAO noted that GPRA's success or failure should not be judged on whether
contentious policy issues are fully resolved; (10) rather, judgment of
the success or failure of GPRA should turn on the extent to which the
information produced through the required goal-setting and performance *
--------------------------- Indexing Terms -----------------------------
REPORTNUM: T-GGD-97-113
TITLE: Managing for Results: Prospects for Effective
Implementation of the Government Performance and Results Act
DATE: 06/03/97
SUBJECT: Congressional/executive relations
Reporting requirements
Strategic planning
Agency missions
Mission budgeting
Federal agency reorganization
Accountability
**************************************************************************
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Cover
================================================================ COVER
Before the Subcommittee on Management, Information
and Technology
Committee on Government Reform and Oversight
House of Representatives
For Release on
Delivery Expected at
9:30 a.m. EDT
Tuesday
June 3, 1997
MANAGING FOR RESULTS - PROSPECTS
FOR EFFECTIVE IMPLEMENTATION OF
THE GOVERNMENT PERFORMANCE AND
RESULTS ACT
Statement of L. Nye Stevens, Director
Federal Management and Workforce Issues
General Government Division
GAO/T-GGD-97-113
GAO/GGD-97-113T
(410143)
Abbreviations
=============================================================== ABBREV
GPRA - Government Performance and Results Act
GM - General Management
GS - General Schedule
SES - Senior Executive Service
OMB - Office of Management and Budget
SSA - Social Security Administration
HUD - Department of Housing and Urban Development
FASAB - Federal Accounting Standards Advisory Board
MANAGING FOR RESULTS: PROSPECTS
FOR EFFECTIVE IMPLEMENTATION OF
THE GOVERNMENT PERFORMANCE AND
RESULTS ACT
====================================================== Chapter SUMMARY
The Government Performance and Results Act, which is referred to as
"GPRA" or "the Results Act," seeks to shift the focus of federal
management and decisionmaking away from a preoccupation with the
activities that are undertaken--such as grants or inspections
made--to a focus on the results of those activities--such as real
gains in employability, safety, responsiveness, or environmental
quality. Under the Results Act, GAO was to report to Congress by
this week on the Act's implementation. Yesterday, GAO released its
report in response to that mandate.
GAO's work shows that to this point, the implementation of the
Results Act has achieved mixed results, which will lead to highly
uneven governmentwide implementation in the fall of 1997. On the one
hand, GAO found that the experiences of some of the Results Act pilot
agencies and related efforts by nonpilot agencies showed that
significant performance improvements were possible when an agency
adopted a disciplined approach to setting results-oriented goals,
measuring its performance, and using performance information to
improve effectiveness. On the other hand, GAO's survey of a random
sample of civilian managers and supervisors in 24 major executive
branch agencies found that although there had been progress over the
last 3 years, managers reported that many agencies did not appear to
be well positioned to provide in 1997 an answer to the fundamental
Results Act question of whether programs have produced real results.
GAO found that agencies are confronting five key challenges that have
limited the effective implementation of the Results Act. These
challenges include those associated with (1) establishing clear
agency missions and strategic goals, especially when program efforts
are overlapping or fragmented; (2) measuring performance,
particularly when the federal contribution to a result is difficult
to determine; (3) generating the results- oriented performance
information needed to set goals and assess progress; (4) instilling a
results-oriented organizational culture within agencies; and (5)
linking performance plans to the budget process.
Addressing some of these challenges will raise significant policy
issues for Congress and the administration to consider, some of which
will likely be very difficult to resolve. GAO noted that the Act's
success or failure should not be judged on whether contentious policy
issues are fully resolved; rather, judgment of the success or failure
of the Act should turn on the extent to which the information
produced through the required goal-setting and performance
measurement practices--once those practices are successfully
implemented--helps inform policy decisions and improve program
management.
MANAGING FOR RESULTS: PROSPECTS
FOR EFFECTIVE IMPLEMENTATION OF
THE GOVERNMENT PERFORMANCE AND
RESULTS ACT
==================================================== Chapter STATEMENT
Mr. Chairman and Members of the Subcommittee:
I am pleased to be here today to discuss the status of the
implementation of the Government Performance and Results Act of 1993
and the prospects for its effective governmentwide implementation.
In essence, the Act, which is referred to as "GPRA" or "the Results
Act," seeks to shift the focus of federal management and
decisionmaking away from a preoccupation with the activities that are
undertaken--such as grants or inspections made--to a focus on the
results of those activities--such as real gains in employability,
safety, responsiveness, or environmental quality.
Congress understood that the management changes required to
effectively implement the Results Act would not come quickly or
easily. The Act therefore included a phased implementation approach
that began in fiscal year 1994 with pilot projects on the Act's
performance planning and reporting requirements. Under the Results
Act, we were to report to Congress by this week on the implementation
of the Act, including the prospects for compliance by executive
agencies beyond those that participated in the pilot phase.
Yesterday, we released our report responding to that mandate, and, as
requested by the Subcommittee, my comments today are based on that
report.\1 We drew on a large body of work we have done in recent
years on the Results Act and on related goal-setting, performance
measurement, and accountability concepts. We also surveyed a random
sample of civilian managers and supervisors at the general schedule
(GS) and general management (GM) levels GS/GM-13 through Senior
Executive Service (SES) levels in 24 major executive branch
agencies.\2 These 24 agencies accounted for over 99 percent of the
federal government's net outlays for fiscal year 1996. The sample
was stratified by whether the manager was SES or non-SES and by
whether the manager was working in an agency or agency component that
was designated as a Results Act pilot and that we were able to
isolate in drawing our sample. Of the approximately 1,300 managers
surveyed, we received usable responses from about 72 percent.
The overall survey results are statistically generalizable to the 24
agencies included in the survey. The survey data in our report that
I will discuss today are the estimated percentages of how officials
would have responded had the entire universe of eligible officials
been surveyed. In general, percentages reported for the entire
sample have confidence intervals ranging from + 5 percentage points
to + 12 percentage points. In other words, if all managers in the 24
agencies included in our population had been surveyed, the chances
are 95 out of a 100 that the results obtained would not differ from
the sample estimate, in the most extreme case, by more than + 12
percentage points.
--------------------
\1 The Government Performance and Results Act: 1997 Governmentwide
Implementation Will be Uneven (GAO/GGD-97-109, June 2, 1997).
\2 In reporting this survey data, when we use the term "manager" or
"federal manager," we are referring to both managers and supervisors.
PROGRESS IN IMPLEMENTING THE
RESULTS ACT HAS BEEN MIXED
-------------------------------------------------- Chapter STATEMENT:1
Our work shows that, to this point, the implementation of the Results
Act has achieved mixed results, which will lead to highly uneven
governmentwide implementation in the fall of 1997. Although agencies
are likely to meet the upcoming statutory deadlines for producing
initial strategic plans and annual performance plans, we found that
those documents will not be of a consistently high quality or as
useful for congressional and agency decisionmaking as they could be.
On a more positive note, the Office of Management and Budget (OMB)
selected over 70 performance planning and reporting pilots that far
exceeded the number required by the Act and that should provide a
rich body of experience for agencies to draw on in the future.
Congress, too, has shown a growing interest in and support for the
governmentwide implementation of the Act. For example, the House
Majority has established teams consisting of staff from various
committees to lead its strategic plan consultation efforts. These
teams have been reaching out to agencies to review and comment on
agencies' strategic plans.
We also found that the experiences of some of the Results Act pilot
agencies and related efforts by nonpilot agencies showed that
significant performance improvements were possible when an agency
adopted a disciplined approach to setting results-oriented goals,
measuring its performance, and using performance information to
improve effectiveness. For example, the Veterans Health
Administration improved services to veterans by more rigorously
assessing the results of the medical care it provides. In
particular, the Veterans Health Administration reported that it used
performance information to target the most important improvement
opportunities and thereby lowered the mortality rate for cardiac
procedures by an average of 13 percent over the last 8 years.
In another example, involving the Social Security Administration's
(SSA) national toll-free 800 telephone number to handle citizen
inquiries, SSA used customer satisfaction and other performance
information to identify and make program changes, including providing
additional staff to handle phone calls from the public. As a result,
the busy rate decreased from 49 to 34 percent, and the percentage of
calls answered within 5 minutes increased from 74 to 83 percent from
fiscal year 1995 to fiscal year 1996.\3
Although these and other performance improvements are noteworthy, the
reported examples of substantial performance improvements were
relatively few, and many agencies did not appear to be well
positioned to provide in 1997 a results-oriented answer to the
fundamental Results Act question: What are we accomplishing? For
example, we reported in January 1997 that the Department of Housing
and Urban Development's (HUD) Public Housing Management Assessment
Program did not collect important information needed to manage and
assess its results.\4 The program is to assess the performance of
local housing authorities by measuring factors such as the numbers of
outstanding work orders and uncollected rents. However, the system
does not measure other factors, such as housing quality, that are
essential for assessing the results that housing authorities are
achieving, as well as for determining which housing authorities are
performing well or poorly.
The situation at HUD appears to be typical. We surveyed federal
managers about the extent to which critical performance measures were
available for their programs. As figure 1 shows, according to our
survey, only 32 percent of federal managers said that, to a great or
very great extent, they have the types of performance measures that
would demonstrate whether their programs or operations were achieving
their intended result. The figure also shows that 38 percent or less
of federal managers reported having, to a great or very great extent,
other important performance measures, such as efficiency and quality
measures.
Figure 1:
(See figure in printed
edition.)
Source: GAO survey data.
As indicated in figure 1, while still viewed as low, significantly
more managers reported the existence of results-oriented and other
performance measures to a greater extent currently than 3 years ago.
For example, when asked to recollect what the situation was 3 years
ago, 19 percent of federal managers reported that, to a great or very
great extent, they had results-oriented measures, compared to 32
percent who reported that they had such measures today. This
represents a 13 percentage point change over what federal managers
perceived the situation to have been 3 years ago, suggesting that
results-oriented performance information, which is essential to the
success of the Results Act, is becoming more widely available.
Obviously, it is not sufficient merely to measure current
performance. The Results Act envisions that performance information
will be used to make decisions and better manage programs. We asked
federal managers about the extent to which results-oriented
performance information was used to help make key decisions about
their programs. As figure 2 shows, the reported use of such
information was limited.
Figure 2:
(See figure in printed
edition.)
Source: GAO survey data.
Similar to the situation with performance measures, federal managers
reported some positive changes in what they recollected the situation
to have been 3 years ago. Although these changes are statistically
significant for most of the uses shown in the figure, these changes
have been modest.
Even among those federal managers who reported that, to a great or
very great extent, they had measures that demonstrate their programs
are achieving intended results, their reported use of
results-oriented performance information was not high. No more than
37 percent of the managers reported that performance information was
used to a great or very great extent to help make any of the key
decisions shown in figure 2.
These survey results underscore how far agencies still have to
progress in the use of results-oriented performance information.
Although there has been progress over the last 3 years, many agencies
still have not developed the information necessary to determine
whether their programs are accomplishing their intended results.
Where managers reported that their agencies had results-oriented
performance measures, the results-oriented information generally was
not being used to a great or very great extent to help make decisions
affecting their programs.
--------------------
\3 Social Security Administration: Significant Challenges Await New
Commissioner (GAO/HEHS-97-53, Feb. 20, 1997).
\4 Public Housing: HUD Should Improve the Usefulness and Accuracy of
Its Management Assessment Program (GAO/RCED-97-27, Jan. 29, 1997).
KEY CHALLENGES REMAIN TO
EFFECTIVE IMPLEMENTATION OF THE
RESULTS ACT
-------------------------------------------------- Chapter STATEMENT:2
We found that agencies are confronting five key challenges that have
limited the implementation of the Results Act. These challenges
include those associated with (1) establishing clear agency missions
and strategic goals, especially when program efforts are overlapping
or fragmented; (2) measuring performance, particularly when the
federal contribution to a result is difficult to determine; (3)
generating the results-oriented performance information needed to set
goals and assess progress; (4) instilling a results-oriented
organizational culture within agencies; and (5) linking performance
plans to the budget process. As Congress recognized when it passed
the Results Act and as the experiences of pilot agencies and related
efforts by nonpilot agencies suggest, these challenges will not be
quickly or easily resolved. I will briefly describe each of these
five challenges and give some examples.
ESTABLISHING CLEAR MISSIONS
AND STRATEGIC GOALS
------------------------------------------------ Chapter STATEMENT:2.1
One challenge to the effective implementation of the Results Act is
traceable to overlapping and fragmented program efforts.
Crosscutting program efforts, such as student loan or economic
development programs, present the logical need to coordinate efforts
to ensure that goals are consistent and, as appropriate, that program
efforts are mutually reinforcing. We found that, when this is not
done, overlapping and fragmented program efforts can undermine
efforts to establish clear missions and goals. Such uncoordinated
overlapping and fragmented program efforts can frustrate program
customers, waste scarce resources, and limit the overall
effectiveness of the federal effort.
For example, we reported in 1995 on the Department of Education
programs that provided loans and grants to students to help finance
their higher education.\5 We found that although the student loan and
Pell grant programs provided the majority of federal financial aid to
students for postsecondary education, another 22 smaller programs
were targeted to specific segments of the postsecondary school
population, such as prospective students from disadvantaged families
or women and minorities who are underrepresented in graduate
education. These 22 programs were collectively funded at $1.1
billion for fiscal year 1995. We concluded that these smaller grant
programs could be considered candidates for consolidation--with other
larger programs or among themselves--with no adverse impact on
students' access to postsecondary education. We also found that the
federal government could anticipate administrative savings of 10
percent each year, or a total of $550 million in budget authority
(adjusted for inflation) over 5 years.
In addition to the problem of overlapping and fragmented programs,
agencies are challenged in setting goals because those goals often
must reflect a balance of competing policy priorities. For example,
we reported in April 1997 that the Forest Service had increasingly
shifted the emphasis of its efforts from producing timber to
sustaining wildlife.\6 This shift was taking place in reaction to
requirements in planning and environmental laws and their judicial
interpretation--reflecting changing public values and
concerns--together with social, ecological, and other factors.
However, we noted that the demand for recreation was also expected to
grow and may increasingly conflict with efforts to sustain wildlife
and produce timber. We found that the disagreement both within the
Forest Service and among key external stakeholders, including
Congress, on how the Forest Service is to resolve conflicts or make
choices among competing uses on its lands had seriously undermined
its efforts to establish the goals and performance measures needed to
ensure accountability. We concluded that until general agreement is
reached, the Forest Service's decisionmaking is likely to continue to
be inefficient and ineffective.
--------------------
\5 Department of Education: Information on Consolidation
Opportunities and Student Aid (GAO/T-HEHS-95-130, Apr. 6, 1995); and
Department of Education: Opportunities to Realize Savings
(GAO/T-HEHS-95-56, Jan. 18, 1995).
\6 Forest Service Decision-Making: A Framework for Improving
Performance (GAO/RCED-97-71, Apr. 29, 1997).
MEASURING PERFORMANCE
------------------------------------------------ Chapter STATEMENT:2.2
A second challenge to the effective implementation of the Results Act
is the often limited or indirect influence that the federal
government has in determining whether a desired result is achieved,
which complicates the effort to measure the discrete federal
contribution to a specific result. Our work has shown that measuring
the federal contribution is particularly challenging for regulatory
programs; scientific research programs; and programs that deliver
services to taxpayers through third parties, such as state and local
governments. For example, determining the impact of economic
development programs has been a daunting task because of the numerous
external forces--including broad national economic trends and the
assistance that communities may receive from state and local
governments and the private sector--that may contribute to local
economic development.
Separating out the effects of federal program efforts can be
extremely difficult, as we observed in a 1996 review of economic
development programs, because it would require, first, documentation
that there had been some improvement in a targeted area; second,
linkage of specific program elements to actual economic changes; and
third, measurement of the growth stemming from other influences on
the economy of the targeted area in order to isolate the impact that
could be attributed to the economic development program.\7
Some agencies are exploring approaches that begin to address the
difficulty they are having in developing useful results-oriented
performance information. Among the approaches that are detailed in
our report are (1) using impact evaluations; (2) using intermediate
performance measures; (3) using a range of measures; and (4) working
with stakeholders to identify and reach consensus on the most
meaningful measures for the program.
--------------------
\7 Economic Development: Limited Information Exists on the Impact of
Assistance Provided by Three Agencies (GAO/RCED-96-103, Apr. 3,
1996).
GENERATING RESULTS-ORIENTED
PERFORMANCE INFORMATION
------------------------------------------------ Chapter STATEMENT:2.3
A third challenge to the effective implementation of the Results Act
is the lack of results-oriented performance information in many
agencies, which hampers efforts to identify appropriate goals and
confidently assess performance. Even when data exist, we have
consistently found that the quality of agencies' performance data is
often questionable due to several factors, including the need to rely
on third parties to provide data. For example, Department of
Veterans Affairs officials told us that some of their
results-oriented measures for a Loan Guaranty program were new and
that baseline data were not available on those measures.
Consequently, they did not have data on past performance to use in
setting some of the program's fiscal year 1998 goals. In some of
these cases, the Department indicated in its fiscal year 1998 budget
submission that those goals were "to be determined." In another
example, Department of Agriculture officials said they eliminated
some performance measures that had been part of their Results Act
pilot's annual performance plan because they did not have a way to
collect data on those measures. Lacking these data, they did not
have an informed basis on which to set goals.
INSTILLING A
RESULTS-ORIENTED
ORGANIZATIONAL CULTURE
------------------------------------------------ Chapter STATEMENT:2.4
A fourth challenge to the effective implementation of the Results Act
centers on the need to instill within agencies an organizational
culture that focuses on results, and this remains a work in progress
across the federal government. According to our survey, federal
managers rated the commitment of top leadership to achieving results
as higher currently than they did 3 years ago. However, federal
managers' responses to our survey also suggested that not much
progress has occurred in agencies to develop and sustain cultures
that focus on results. For example, when we asked federal managers
about the extent to which they or supervisors at their levels had the
authority they needed to help their agencies accomplish their
strategic goals, the federal managers did not perceive that they had
more such authority currently than they recalled having 3 years ago.
Significantly, for federal managers from the Results Act pilots that
we were able to isolate for our sample, managers' perception of the
extent of their authority currently was much lower than their
perception of the situation 3 years ago. For example, 40 percent of
SES managers from selected pilots reported that managers at their
level had authority to help the agency accomplish its strategic goals
to a great or very great extent currently, while their perception of
this extent of authority 3 years ago was 56 percent--a difference of
16 percentage points.
These survey results suggest that as agencies implement the Results
Act and strive to become more results oriented, they need to pay
special attention to ensuring that key managers have the authority
they need to achieve intended results. In passing the Results Act,
Congress recognized that if federal managers were to be held
accountable for program results, they would need the authority and
flexibility to achieve those results. Congress also understood the
importance of affording federal program managers the freedom to be
innovative and creative and to marshal resources to achieve results.
Thus, the Results Act authorizes agencies to apply for managerial
flexibility waivers of nonstatutory administrative procedural
requirements and controls in their annual performance plans. The Act
further specified that managerial accountability and flexibility
waivers were to be piloted during fiscal years 1995 and 1996.
However, as we reported in April 1997, the managerial accountability
and flexibility pilot did not work as intended.\8 We found that three
major factors contributed to the failure of the managerial
accountability and flexibility pilot to work as intended. First,
changes in federal management practices and laws that occurred after
the Act was enacted affected agencies' need for the waivers. Second,
agencies could use other, less rigorous, means to obtain waivers from
administrative requirements. Third, unlike its active approach to
the first set of Results Act pilots covering performance planning and
reporting, OMB did not work actively with agencies that were seeking
to take part in the managerial accountability and flexibility pilot.
--------------------
\8 GPRA: Managerial Accountability and Flexibility Pilot Did Not
Work As Intended (GAO/GGD-97-36, Apr. 10, 1997).
LINKING PERFORMANCE PLANS TO
THE BUDGET PROCESS
------------------------------------------------ Chapter STATEMENT:2.5
Finally, a fifth challenge to the effective implementation of the
Results Act is the need to link agencies' performance plans directly
to the budget process through the Results Act requirement to base the
annual program performance goals on the budget's program activity
structure.\9 We have found that the extent to which the budget's
program activity structure can be directly linked to a
results-oriented performance framework varies widely among
activities, and adjustments and accommodations in the program
activity structure may be needed. Reaching agreement on such changes
between Congress and the executive branch will be a time-consuming
and difficult process that will likely take more than one budget
cycle to resolve.
--------------------
\9 Performance Budgeting: Past Initiatives Offer Insights for GPRA
Implementation (GAO/AIMD-97-46, Mar. 27, 1997).
AN AUGMENTED REPORTING
FRAMEWORK HOLDS PROMISE FOR
STRENGTHENING FEDERAL
DECISIONMAKING AND
ACCOUNTABILITY
-------------------------------------------------- Chapter STATEMENT:3
The Results Act is the cornerstone of a series of initiatives that
are intended to provide a comprehensive framework for integrating
program, cost, and budget information. Improved financial reporting
and auditing required by the Chief Financial Officers Act should
strengthen the reliability of cost and performance information. The
Federal Accounting Standards Advisory Board (FASAB) has developed a
new set of reporting concepts and accounting standards that underpin
OMB's guidance to agencies on the form and content of their
agencywide financial statements.
FASAB standards include a new reporting model for federal agencies
geared to providing users with information about budgetary integrity,
operating performance, stewardship, and systems and controls. These
standards also include cost accounting standards that became
effective beginning with fiscal year 1997 and are the first set of
standards that are to account for the full costs of federal programs.
For the first time, decisionmakers are to be provided with annual
"report cards" on the costs, management, and effectiveness of federal
agencies. The FASAB cost accounting standards, if successfully
implemented, are to provide decisionmakers with information on the
costs of all resources used, including the costs of services provided
by others to support activities or programs. Such information would
allow for comparisons of the costs of various programs and activities
with their performance outputs and results.
------------------------------------------------ Chapter STATEMENT:3.1
In summary, Mr. Chairman, the performance improvements already
reported strongly suggest that the basic goal-setting and performance
measurement model used by the Results Act, if successfully
implemented, will be an important tool to improve federal management
and performance. However, addressing some of the challenges that I
have highlighted today, such as crosscutting program efforts and
balances among competing priorities, will raise significant policy
issues for Congress and the administration to consider, some of which
will likely be very difficult to resolve.
The Results Act's success or failure should not be judged on whether
contentious policy issues are fully resolved; rather, judgment of the
success or failure of the Act should turn on the extent to which the
information produced through the required goal-setting and
performance measurement practices--once those practices are
successfully implemented--helps inform policy decisions and improve
program management. Although progress thus far has been mixed and
implementation this fall will be uneven, the Results Act has shown
that it has the potential for improving the federal government's
performance and sharpening executive branch and congressional
decisionmaking.
This concludes my prepared statement. I would be pleased to answer
any questions.
*** End of document. ***