What it Takes to Change Government

Presentation

What it Takes to Change Government

Washington, DC Spring, 2009

This document is proprietary to and may not be released without attribution to Booz Allen Hamilton Inc.

Contents I.

Motivations and Context for this Research

II.

Methodology

III. Results and Conclusions IV. Contact

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Motivations and Context for this Research…

Booz Allen sponsored a rigorous research effort to find out how public strategies are most effectively developed and implemented Some government agencies set strategy – but are never really able to carry it out Other leaders overcome substantial challenges – and achieve monumental strategic change What differentiates the successes from the failures? We believe that evidence could help leaders use the techniques of those who succeeded

Purposes • Contribute to fact-based knowledge of how public strategies are successful • Provide thought leadership in the fields of public administration, strategy development and strategic change • Support strategy and transformation efforts – particularly following the 2008 presidential election

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Methodology…

We studied 11 leaders who sought to implement ambitious change at cabinet and sub-cabinet level U.S. federal agencies The leaders were nominated by members of the National Academy for Public Administration and fellows of the Council for Excellence in Government Each leader was nominated for having succeeded (eight), or for having “met significant challenges” (three) in the carrying out the change they sought to make To create a larger control group, we also interviewed six “counterparts” who led the same agency as a successful leader, except during the previous or subsequent administration Evidence was gathered and analyzed by Booz Allen in collaboration with Harvard Kennedy School Professor of Public Management Steve Kelman 8 7

Successful Case 1 2

9 8

6

Unsuccessful / Counterpart 1

3 5

4

2 3

4

7 6

We conducted more than 300 interviews with federal agency leaders and their employees, career executives, congressional staff, unions, media, customers, and interest groups. We also reviewed strategic plans, congressional testimony, budget requests, and GAO reports

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3

Methodology…

The studied agencies range in budget, size, and sector – and they pursued a wide variety of strategic goals Range of Studied Agencies Reporting Level

Administration

Sample Strategic Goals Modernize agency structure, process, image Transform agency mission

U.S. President

Cabinet Secretary

Clinton 1993-2001

Bush 2001-2009

Integrate management Consolidate, collaborate with other agencies

Annual Budget

$8 to $50 billion

Sectors – Health – Security

Number of Employees

2,500 to 200,000

– Finance – Research – Regulation

Coordinate field offices Implement a new nation-wide benefit, and improve associated existing services Obtain new resources (money, staff, materials) Institute pay bands

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Methodology…

For each case, we vetted commonly held hypotheses regarding strategic change Hypothesis Rating Scale

Data Sources Applied

Hypothesis #29: Develop and use objective metrics for the organization and employees to assess strategy implementation and outcomes

M

• Agency Leader interview

If the leader mentioned this technique, without prompting, as a way he/she sought to achieve goals, we show an “M”

“Subordinate” interviews inside and outside the agency give more perspective for successful and unsuccessful leaders Agency developed objective metrics, used the metrics frequently, and revised strategy based on the metrics Two or three of the above are true OR all are partially true OR all are true, but were not effective One or none of the above is true Successful

Hypothesis 29. Develop and use objective metrics for the organization and employees to assess strategy implementation and outcomes.

Org 1

Successful

Org 2

Org 3

Successful

Org 4

Org 5

Org 6

M

Control Group

M Control Group

Org 8

Org 10

Org 11

Org 13

Org 14

M

M

Control Group

Counterpart

Unsuccessful Org 9

M

Control Group

Counterpart Org 15

Org 16

Counterpart Org 17

Org 12

Each case represents the leader of a cabinet or sub-cabinet level agency between 1992 and 2008.

M

M

Interviews with: • OMB Examiner • GAO Representative • Middle Managers • Director of Planning • Deputy

Each hypothesis has its own unique rating scale and prioritized list of sources

Successful Org 7

Each case represents the leader of a cabinet or sub-cabinet level agency between 1992 and 2008.

M

(Sources are listed in order of priority. Input was sought but not obtained from all sources for all cases)

The contrast between “Successful” and “Unsuccessful” agencies/leaders is based on nominations by NAPA and CEG members, validated by the agency’s internal & external interviewees’ 1-10 scale ratings of success

M

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Results and Conclusions…

From across a large number of detailed findings, we draw two overall conclusions

It seems to be no accident that successful leaders achieve their goals

The successful leaders we studied generally used similar techniques, and those techniques fell within their discretion and control. In contrast, leaders who did not achieve their goals, and those who did not attempt ambitious change, tended not to use the same techniques.

It’s more important to be a good manager than to be good at change in particular

While both successful leaders and those who were not successful used traditional change management techniques, the leaders who successfully led a change in government were most prominently distinguished by their use of good general management techniques that are not uniquely suited to initiating or carrying through change. These general management techniques include, for example, using a strategy planning process, using performance measures.

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Four techniques emerge as the top differentiators for successfully effecting ambitious change in federal agencies Use a strategy planning process, but remember – a fancy plan isn’t the point Seventy five percent of the successful agencies and leaders used a strategic planning process, while just one in nine (eleven percent) of our control group did so

Use performance measures – Most of the successful agency leaders used performance measures to move their agenda forward, while most in the control group did not. Some agency leaders used performance measures from third-party organizations.

Build relationships proactively with interest groups and Congress – Successful

leaders worked hard to inform interest groups and Congress, and get their support – beyond public forums and appropriation hearings, even on tennis courts. Successful leaders worked with a range of relevant external stakeholders and engaged potential opponents.

Establish accountability for strategy – Successful leaders aligned appraisals and

rewards for senior executives / managers to hold them accountable for implementing strategy and achieving successful outcomes. Several removed or reassigned executives for strategy performance related reasons, while unsuccessful leaders did not

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Methods of managing inside the organization distinguished those who succeeded (choosing a good strategy isn’t enough) Get a running start – Half of the successful leaders used time between nomination and confirmation to understand their agency, its environment, strategy options, supporters/ opponents, and the positions of key members of Congress

Use just two or three goals – Those who failed had too many goals, and their goals were tactical or counterintuitive. Audiences didn’t understand or consistently agree on their goals

Collaborate with your employees – encourage their participation – Nearly every

successful leader emphasized a collaborative style, while less than half of the control group did (note however, that two of three unsuccessful leaders mentioned a collaborative style)

Manage within your organization, not just at 50,000 feet – Successful leaders

focused half their time inside their agency, while unsuccessful leaders spent just one quarter inside, and three quarters outside

Consider reorganizing the agency if that will better enable you to make the changes you seek – Three quarters of the successful leaders reorganized their agencies – compared to just one of nine in the control group

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Why, in your opinion, don’t ALL leaders use the techniques that this research found differentiate successful leaders? • Use a strategy planning process

• Get a running start

• Use performance measures

• Make well-informed choices

• Brand your change

• Collaborate with your employees

• Build relationships proactively with interest groups and Congress

• Manage within your organization, not just at 50,000 feet

• Use just two or three goals

• Consider reorganizing

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The study also found several mistakes that past leaders made…

Don’t be in such a hurry to set your strategy that you neglect key steps - The

most common feature of the unsuccessful leaders in our study was that they set strategy quickly, and neglected to gather necessary data on customer needs, stakeholder expectations, and employee ideas about what can be implemented

Don’t expect that spending more time and energy is enough to produce better results - Successful leaders actually reported spending slightly less time (about ten percent less) on the job than unsuccessful leaders. The successful leaders simply spent their time more effectively. For example, successful leaders worked proactively with Congress and stakeholders to set the agenda, present and justify their strategy… it may turn out that this requires much less time than reacting defensively down the line.

…and that some current leaders may now be making

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Other techniques weren’t used any more often by those who succeeded - or weren’t used at all - and were rarely mentioned by the leaders themselves Used by Successful and Unsuccessful Alike Align major business processes to the adopted strategy – Most successful agencies and leaders did this, but many unsuccessful ones did, too

Revise job descriptions, retrain employees, recruit employees with new skills – About half of the successful leaders and agencies did this – almost exactly the same proportion of unsuccessful leaders and agencies did, too

Used Infrequently Develop and publicly consider alternative strategies – Few successful leaders

did this, and few unsuccessful ones did as well, despite a hypothesis that open, public discussion of alternatives might lead to buy-in for the one selected. Many successful leaders considered alternatives prior to their start, or early in their tenure (without public discussion)

Proactively seek to engage public support from the White House – Again,

relatively few leaders did this – and some that did seemed to do so as a last resort, usually without good results

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Finally, while most differentiators for success were under the control of the agency leader, some factors were not Tenure may be a differentiator – several successful leaders held an office with a fixed term – Four out of ten successful leaders held offices with a fixed term (for example, the Comptroller General - 15 years, IRS Commissioner - 5 years). None of the unsuccessful leaders had a similar luxury, and their average tenure was more than 1 year shorter

Brain surgeons are more likely to succeed at brain surgery – We reviewed agency leaders’ background. All but one success had significant experience in their agency’s focus area prior to appointment. Many of the control group did, but one-third did not

Career staff capability counts – All nine of the agencies we studied that were successful

included a smaller proportion of political appointees than other federal agencies. In fact, seven of the nine successful agencies included fewer than one-tenth the percentage of political appointees as does the average federal agency; three of these include fewer than one onehundredth

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For additional information:

“Booz Allen is sharing this research in public forums because we believe that it can help agency leaders succeed.” - Dave Mader, Booz Allen Vice President, Former IRS Assistant Deputy Commissioner

Contact: Dave Mader (703) 377-1333 [email protected]

Steve Kelman (617) 496-6302 [email protected]

Jeff Myers (703) 902-4125 [email protected]

Emily Rae (360) 306-0940 [email protected]

Browse: * http://www.BoozAllen.com/What-it-Takes-to-Change-Government/ * http://KSGnotes1.Harvard.edu/Research/wpaper.nsf/RWP/RWP09-009

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Methodology…

We studied 11 leaders who sought to implement ambitious change at cabinet and sub-cabinet level U.S. federal agencies

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