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Quality Management Hearing (Statement Submitted for the Record)

 

STATEMENT OF DAVID J. BARRAM
ADMINISTRATOR

GENERAL SERVICES ADMINISTRATION
BEFORE THE
SUBCOMMITTEE ON OVERSIGHT OF GOVERNMENT MANAGEMENT AND THE DISTRICT OF COLUMBIA
COMMITTEE ON GOVERNMENTAL AFFAIRS
UNITED STATES SENATE

OCTOBER 15, 1999

 

American business hit a rough spot in the road in the 1970's. International competition and expensive fuel oil were putting sharp pressures on performance and productivity. Total Quality Management emerged to help. It was a systematic and highly disciplined method by which quality of products could be improved without concurrent increases in cost. Actually, costs dropped. In fact, as I learned in the private sector, quality is actually free because the bump that is gained in employee performance and productivity virtually cancels out any financial investment for the program.

Ford, where "Quality is Job 1 ", was one of the most visible success stories of the TQM effort. The Baldridge Awards have highlighted other terrific successes. And when I met the Baldridge winners during my tenure at the Department of Commerce I heard again the big lesson: quality is one proven path into good management. And good management is what it is all about.

Good management is what we are about at GSA. I am here today to give you a very cursory overview of what that means for us.

Good management is not a one shot, one pill, one remedy answer. Instead it is a .1 systems" answer in which the leadership juggles change on a number of fronts. To judge if an organization is successful requires a look at each of those fronts.

1. Context

The Clinton Administration has championed good government. GSA jumped on opportunities to try different management techniques in our many NPR labs, and given the number of Hammer Awards received, I believe we learned and contributed much.

GSA also moved its mission away from mandatory, monopoly delivery of services and product. This changed the fundamental terms of business for us in a good management direction.

The pressure to reduce our size along with being able to offer buyouts allowed us to cut from over 20,000 people to 14,000 people, thereby freeing up all kinds of talent that had been buried in the organization. At the time, some worried we were "cutting muscle with the fat". We can confidently say that people have stepped up to the challenge. We have added helpful technology, and we have added procurement and project management skills, which are our core competencies. We rely on outside expertise where cost effective. And, our own

people are shedding work processes wherever possible as they focus more on results and less on getting six signatures for each form.

Finally, the Administration's keen interest in labor-management partnerships has been important to GSA. We believe strongly that reinvention applies to us, to our union partners, and to our relationships. In that spirit, we have been aggressive in moving to a new goal, which fits with the extraordinary changes in our economy. The old goal was "job security". The new goal is "employability." We believe and have worked hard to focus on skills, to give all employees technology experience, to expect excellence and results so that employees are working on important and valued tasks, to communicate daily and so on. Much of this tale is simply good management but it gives all employees a leg up in the economy and for that we are proud.

In addition, we have a whole new set of management tools available to us under the GPRA legislation. GPRA emphasizes strategies, measurements, and results, three of the key elements that I am talking about today. As we have pushed for these inside GSA, GPRA has given us reinforcement and encouragement from the outside.

All that set the larger stage for us to change and focus on good management, rather than protective or territorial issues.

2. Strategic direction

Employees need to know where an organization is going. GSA people are no different. It is also critical - and only human - for people to feel part of something important. When I became the Administrator in 1996 the first task I took on myself was to "test", if you will, various visions for GSA. I believe - and our story confirms - that vision must be shared and evergreen. It must be something the whole organization can agree upon and respond to. It must be real. It must be something you can remember. But you can't ask for votes. It cannot be a wordsmithed statement hung in the lobby. The leaders need to listen hard for visions, which resonate, which come back to them in the language, in the presentations, in the focus of the organization.

So, we quickly "tested" visions. Three stuck. A fourth emerged a year later. We keep practicing a couple others.

The first was "thrill your customer". Greeted first with chuckles, the phrase soon became part of the lexicon. The point is that everyone knew what it meant. They knew enough to start checking themselves for whether they were in tune. Were they connecting to customers? Were they thrilling them?

The second was excellence. We quickly realized we needed to be the best in order to survive in a non-mandatory world. Like Hertz who championed the "We're number One" theme as much for its own employees as for its advertising jingle, GSA quickly adopted "Can't Beat GSA". This became a mantra of excellence.

Change was third. I gave an early speech in which I remarked "This is Not Your Father's GSA." I shamelessly stole the phase so I could quickly to tell the story of change. People laughed. Then when I was introduced at another event, I was introduced as the Administrator who says, "This is Not your Father's GSA". Lo and behold, a third vision, one about change. I was just in St Louis responding to a request that I deliver a speech about "What My Daughter's GSA will Look Like." The vision of change deepens within our people.

The fourth vision took a little longer to catch hold. We talked about the idea of "honest conversations" being a norm for our whole organization. It seemed simple and something that ought to be there anyway. But in a highly political environment, it wasn't always. I tried again in my State of the Agency address. I talked about our need for customer partnerships, for clarity among ourselves, in short, our need to practice honest conversation. And it stuck. We created a chat line immediately thereafter, which I am proud to say is still a part of our culture. The honest conversation on it is almost raw at times but fundamentally healthy. It is a vigorous and an important method for people to push each other, ask questions, and air their anxieties.

3. Leadership

Vision is nice but it is not enough. The leadership team needs to be its champions.

One of my top priorities has been developing, challenging, and tapping the creativity and energy of our leadership team. My Chief of Staff would tell you this is her Job One.

How did we do this? First, the buyouts created great turnover. Approximately 25% of our executives have mustered out of the agency in the last four years. Some were top notch. Some were marking time. But the sheer turnover gave us lots more flexibility.

Second, we have pushed, prodded, demanded and enticed executives into changing jobs. We no longer keep track of the numbers but I would venture that less than 20% of the executive team is in the same job it held three years ago. It is the cheapest training I know. It is also the only way to learn leadership and to demonstrate the demands of change - by doing it yourself.

Third, we have tweaked the compensation process. A portion of the SES bonuses is now awarded in a peer process. We believe firmly that executives need feedback from each other. A team is strong only if it is talking honestly among its members. And who is to say that I know the right compensation for all 111 executives. We do it three or four times a year, like this: each executive is given $400 to distribute to his or her peers. We name the criteria for each award: honest conversation, thrilling customers, building skills in people, etc. And the results are right on. The customer fanatics get money when that's the criteria. The people who teach, mentor and shape skills get money when that's the criteria. We publish the nominators, the recipients and the award amounts. If you're just giving it to a buddy everyone will see and know. So you don't.

This was not without controversy. Just as controversial, though, have been our leadership conferences. Once a year the executive team has gone off site for four days and immersed ourselves in a huge amount of creative material. Our conferences are hardly typical. We firmly believe that speakers - inspirational or substantial - are of very limited value when you are aiming for real change. We cannot exhort good leadership out of executives. It comes from within as people experiment, experience, expand, explicate, extract and ultimately exult in their abilities.

Our conferences aim for all that. We have asked executives to name their business passions and team up with others who share them, to imagine the future in groupware technology, to create product fairs and then defend products to venture capitalists, to hear master story tellers, to create a mock web page of their own, to describe customers in visual and graphic design ways so they can appreciate the dimensions of customer profiling, to read and discuss books like Antigone which tell of classic leadership dilemmas, and so on. We know that executives need to think in new ways. Good management requires lots of flexibility and discipline. We also know that the lessons we hope people will acquire come to them over time.

Inside all this wonderful story of leadership challenge and development is one very tough problem. That is the problem of moving people out of jobs or rank when they are no longer the right match for the work. Often, this is the problem of poor performance.

While buyouts helped us reduce our overall headcount, it also meant we lost some good performers. But, not every senior executive was a high performer. So, we applied ourselves to "expecting more" from our senior executives and have taken some strong actions to remove some poor performers from the SES. It has been neither pleasant nor quick, but we believe we should always be evaluating and counseling executives because the SES should reflect the best executive leadership possible.

Let me just comment on the issue of the government personnel regulations and processes. I don't doubt OPM and my own Chief People Office when I'm told that I can do just about anything I need to in order to manage our workforce. I am sure that I can remove a poor performing senior executive. The issues in my way are time, energy, and expense

At GSA, I have been sworn to good stewardship to our citizenry. I have to make executive decisions all the time about where to apply resources for the most leverage in service to our country. Should I promote small business, organize leadership conferences, testify on the Hill, hold measurement reviews, meet with employees, or develop partnerships with vendors? Or should I divert a lot of valuable effort to an overly complex, cumbersome, resource intensive personnel process. Guess what most executives will choose? And so very little gets changed.

This is not good management. It is doable, barely, but it is not management that respects time, resources, the risk/reward calculation of executive leadership, my judgment, or the future oriented needs of our organizations.

4. Technology

And then there is technology - computers, telecommunication, the Internet, etc. There is no possibility of finding good management in the modern government organization if technology is not smack in the center of everything. The surest and quickest way to empowerment, feedback, information exchange, and good communication is to give people technology tools. We insisted by Flag Day in 1996 that every GSA employee should have access to the Internet. That decision now seems to have been no big deal, but in 1996 we were leaders. The signal we sent to the organization was - be hot, be out in front, learn, change. What better way exists to unleash the power of the individual employee? Certainly there is no cheaper or quicker way.

We can point now to obvious benefits.

We have an on-line university service through which employees can choose from, and take, hundreds of courses.

We have an Intranet that allows people to sign up for events, handle their travel and transportation forms, read our GSA daily newspaper, adjust their personnel information, research policies, you name it.

We have e-mail, which unlocks the power of asynchronous communications. It is hard even to remember the energy we used to spend just trying to catch each other on the phone.

We have people at low-grade level assuming much more sophisticated presentation, graphical and marketing tasks.

And, that's just inside GSA. Our use of the Internet is huge. We simply couldn't be as good as we are without it.

5. Disciplines

Unlocking the power of an organization is one large job. The "yin" to balance that "yang" is to put all that power into some sort of coherent order. We can't function like bumper cars. We need disciplines.

Three years ago we declared "measurements" to be one of our four operational priorities. In many ways this was TQM reinvented. It was important to find the proper data streams, summarize what the data told us, share it with some analytical awareness, use "information" to make decisions, build our skills.

Measurements propelled us a great distance in just a few short years. First we had to demand more of our systems. We trashed long-standing legacy systems and installed new ones. This has not been without serious stress but we could not stall or we wouldn't learn enough.

Our Chief Information Office was established and quickly became an important part of our infrastructure. We even made a video tape of the role of the CEO and the CIO in which we interviewed powerful CIO and CEO's from the private sector who explained this important new resource. We called it: Joined at the Hip, The CEO/CIO Relationship.

In quarterly reviews we began to dig into the measurements now available to us. We set aside the piles of statistics and honed the measurements. Each iteration brought new questions and insights. If we learned anything, we learned that measurements are very dynamic critters. If done right, they only serve to force the next question and demand the next level of excellence. Our Public Building Service stands tall in its rapid assimilation of a measurement culture. This is quite important because it is our biggest service and its business model cries out for measures that give us the pressure for continual improvement.

Another discipline we are internalizing is project management. GSA fills a particular niche in the federal government and much of that is our expertise in project management - be it in construction projects or information technology. We have created a "center of expertise" in our Public Buildings Service focused on project management. We are also approaching our current information systems projects from this perspective, intending to break the long-standing traditions of design-build as the only way to get what we want. Put another way, we are learning the power of technology in our project management discipline and understanding that "Standards will set you free".

One quite visible manifestation of management discipline has been the re-ordering of our central functions. We decided to streamline our "professional services" functions, namely legal, financial, personnel and information. Each of these specialties has parallel entities in the private sector so it is easier to benchmark and seek "best practices". In addition, the clarity of the central functions, the Four Chiefs and General (Chief Information Office, Chief Finance Office, Chief People Office, Chief Knowledge Office and General Counsel) makes their support and expertise more clearly defined for their customers.

6. Style and culture

To say that we have accomplished certain "good management" results is to downgrade the importance of creating a culture and style of "good management". No effort is good enough if it doesn't resonate, or find a simple way to check itself, or otherwise become integral to an organization.

Two things help define style and culture for GSA. The first has been the need for change and the second is the need for "testing" potential changes quickly. Another word for that is experiment. We are learning to experiment, to assume and absorb an appropriate level of risk, to stand a little taller in the face of gratuitous criticism. It is hard and it requires steadfast leadership, a lot of belief in people, not a little courage. I congratulate the career civil servants of GSA. They have regularly stepped forward, perhaps even gone at times where angels fear to tread.

One example is our fast track awards system. We long ago decided that awards needed to be granted closer to the work that warranted them. In other words, why wait a year to say congratulations and thank you to a person for a job well done? To decentralize the awards system and make it "real time" in character required a lot of risk. No longer could a manager wait until one pre-selected time to review the whole budget and set priorities on the awards. This was an extraordinary change in control. It required new systems, new terms, new expectations and we had to do it while in the race - not when the race was figuratively over. This was manage as you go and do so in new and important ways. It has been terrific. We've learned a lot and people perceive awards no longer as entitlements but as earned rewards.

Another example is our Chief Knowledge Officer. Information systems are one thing and take a lot of our energy. But, just how does information turn into the kind of knowledge that we need? We don't know. Few seem to. So, we created a CKO and have asked her to start helping us find some answers.

Another example is challenging executives to, themselves, change. We are constantly moving senior people into different jobs. Imagine being a Chief Financial Officer, one of the most respected career people in the government, and the Administrator asks you to move over and lead the Federal Technology Service. Or, imagine you are a lawyer, in fact a great lawyer. The Administrator asks you to take a position called "Strategic Innovations" in the Public Building Service. It's a new and important role that hinges not on legal strategies but on new lines of business. Or, imagine you are the Deputy Regional Administrator in Chicago who cares first and foremost about customers. Within a single year Ken KaIscheur, and 5 SES colleagues, created a systematic definition of the difference between "satisfying" and "thrilling" the customer. Ken then applied those new higher bars of excellence in an integrated support project to a customer in high need, namely the Census Bureau. From this we have learned a huge amount about responding to customers, being internally flexible, communicating our performance and in general adding value where value was surely needed.

I am proud of the progress we have made at GSA. Good management is a quest that never ends. We have been able to shed a lot of old bad habits and turn our face to the future with energy and skill. I am confident that the preponderance of employees at GSA recognize that we are different these days, that measurements and customers matter, that we will have to keep changing and improving. Government service is no less.

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