GCN INTERVIEW | John Mercer, government reformer

GCN July 27, 1998

Performance plans must become routine

John Mercer served eight years as counsel to the Senate Governmental Affairs Committee, where he was the architect of the Government Performance and Results Act. Last year Mercer left government to become deputy director for government performance planning at Federal Data Corp. of Bethesda, Md. As a consultant, Mercer advises agencies how to implement the GPRA legislation. His clients include the Veterans Affairs Department, Office of Personnel Management, FBI and agencies of the Defense and Interior departments. Before coming to Washington, Mercer served as mayor and council member in Sunnyvale, Calif. The city’s performance-based management and budget system was the inspiration for the federal GPRA legislation. In addition to his 13 years on Capitol Hill, Mercer also served a stint as deputy assistant secretary for program policy development and evaluation at the Housing and Urban Development Department, where he assisted state and local governments in using community development block grants. Mercer received a bachelor’s degree in public administration from San Jose State University and a law degree from the University of Notre Dame Law School. GCN senior editor Florence Olsen interviewed Mercer at his office in Bethesda. What’s more Family: Wife, Sandrine, is an international sales account executive with UUnet Technologies Last book read: The History of France by G. de Bertier de Sauvigny Hobbies: Running, tennis, reading Motto: “Whatever you get involved in, make a real impact and have fun.”

GCN: How many government people do you think really understand performance planning?

MERCER: If we’re talking about performance planning as envisioned by the Government Performance and Results Act, I’d say certainly less than 10 percent. Most federal employees have not yet been involved.

The agencies have had only a handful of people putting together the strategic plan and annual performance plans that GPRA requires, and some agencies are barely aware of the law.

GCN: Isn’t this unusual? The law was enacted in 1993.

MERCER: It’s not unusual for any agency to struggle when it starts doing comprehensive performance measurement. It wasn’t until last year that many agencies got serious. You could say they had fair warning it was coming, but many of them ignored it until last year when they had to submit a strategic plan to the president and Congress.

Many agencies thought they knew what strategic planning was but then realized how difficult it was when they tried to do it.

Agencies hadn’t been developing annual plans that said: Here’s what we’re going to do this year, and here’s the link between the annual plan and the budget—and what we’re going to do this year is going to take us one-fifth of the way toward our five-year goals.

GCN: Do you think performance planning or performance measurement will be as difficult for agencies as business process re-engineering?

MERCER: Yes and no. The fact that performance measurement is mandated by statute with a fair number of specific requirements makes it more difficult.

There are GPRA requirements not only in the statute but in guidance from the Office of Management and Budget, and in recommended evaluation criteria from the General Accounting Office and from Congress, which has come up with its own scoring card. GPRA is a very visible effort, and that’s why it is probably tougher.

On the other hand, the fact that GPRA is a statute and not the management flavor of the month means the effort will be more sustained. That sends a message to career civil servants that this isn’t just some political flavor of the month handed down by a particular administration or a congressional committee chairman asking that something be done. The law says we’re going to do this, and we’re going to stick to it until we get it right.

GCN: What does the law require of agencies in terms of performance and results?

MERCER: There is a requirement that every agency has a five-year strategic plan that goes into effect beginning with the year it was submitted. That plan must have long-term goals as well as a description of strategies for accomplishing them.

The second major requirement is an annual performance plan that shows in detail the performance goals for each program. For each long-term goal in the strategic plan, you have one or more measurable annual performance goals.

The emphasis is on setting goals for outcomes rather than outputs, recognizing that both forms of measurement are legitimate. It’s one thing to measure how many people enter and complete job training programs. It’s another thing to say how many will get jobs and go off welfare.

The annual performance plans were submitted at the time the president submitted his budget in February so that Congress can, in theory, look at annual performance and budget proposals side by side. That is happening right now, and the annual plans go into effect for the new fiscal year Oct. 1.

GCN: Is GPRA going to be expensive for agencies to comply with?

MERCER: The experience of others who have done it right is that it’s not costly, especially if you have program managers involved who see it as part of what they should be doing anyway.

When you’re developing a budget, you should give thought to how you will spend money and what you will get for it.

If GPRA has a cost, it will be on the information technology side. After you have established goals for programs, the law requires a report at the end of the year

on what you accomplished. Getting the data in a timely fashion means reporting results to the president and Congress six months after the fiscal year closes.

What is behind GPRA is a vision of agency program managers getting a constant stream of performance data related to measurable goals throughout the year.

To get that kind of information, particularly when you have data embedded in legacy systems, is a real challenge that may require upgrading information management systems. That can be costly, but it is the sort of thing agencies do anyway on a periodic basis. It should become part of the system requirements that the information management system generate performance information for managers on a weekly basis.

GCN: Are the electronic information systems in most federal agencies adequate for the requirements of the law?

MERCER: Absolutely not. As a rule they are not able to support the law’s implementation the way it was envisioned. That’s partly because IT systems have not been set up to measure and report performance.

In some instances, it may be a matter of finding the data and pulling it into a data warehouse. In others, it may require updating systems or buying new systems. If you are doing a comprehensive performance management system as GPRA envisions, it means the IT people sit down and talk to the budget and accounting and program management staff to figure out what information they have and what they’re going to need. I’m not sure that conversation has been held in many agencies.

GCN: Have any agencies been exemplary in meeting the new requirements?

MERCER: The Transportation Department is recognized as doing the best job overall. The Education Department also has been doing well. Veterans Affairs has shown the biggest improvement. Many other departments have been found by Congress to be seriously wanting.

GCN: What inspired you to make a career of reinventing government?

MERCER: I was always interested in government from high school on. I studied public administration as an undergraduate and came to Washington when I got out of law school. I went to work on Capitol Hill, so I was exposed early on to policy debates.

I left after five years and returned to my hometown of Sunnyvale. This was in the late 1970s, and Sunnyvale was just starting a comprehensive performance management and budget system about the same time I got elected to the city council.

Over the eight years I served on the council, and part of that as mayor, I saw how effectively it worked. I believed at the time, as I still believe, that the city had discovered something about the power of measuring goals and linking that to budget resources.

I remember thinking, aha, now I understand why the federal government is so screwed up. All the policy debates were about whether a particular program was a federal responsibility or not, never about what the program should accomplish. That argument was always missing from the debates I heard in Congress in the five years I was on the House of Representatives staff.

GCN: Isn’t there considerable overlap between GPRA and the requirements of the Government Management Reform Act and the Chief Financial Officers Act?

MERCER: There is certainly a very strong relationship. GMRA and CFOA together require reforms of financial management systems and annual audits. If you think of those two laws as the spending side of the coin, GPRA is the performance side.

When all three laws are effectively implemented, you should have an true picture of what you are spending and what you get.

Budget structure reforms are necessary, because the budget account structures don’t match performance plans as well as they should. They were created at different times for different purposes, and the appropriations staff has difficulty making cross-references.

If you want to do all of this right—good financial management, good performance measurement, good accounting systems, a rational budget process—all the players need to be at the table coming up with a common plan. Then they can each go out and execute their own piece. When you reassemble the pieces, they should fit together in one nice picture.