strategies for success in the new normal

Strategies for Success in the New Normal

Dr. Joe Saviak, J.D., Ph.D. Associate Professor & Assistant DirectorPublic Administration ProgramFlagler College

Redefining Government in the 21st Century The New Normal The Monopoly Is Dead High Performance Government Use of Analytics High Performance Workforce Redesigning Government – Partnerships, Contracting & P3s, Vouchers Redesigning Public Pensions & Employee Health Care Strategic Planning Program Evaluation Organizational Culture Communication Leading Change/Innovation in the Public Sector Moving from Government to Governance

Redefining Government in the 21st Century It’s malpractice when we do not provide managers and professionals

with the understanding, skill set, and the ability to use all the tools they should have in their problem-solving tool box for the challenges of the 21st century

Organizing government around the realities of the 20th century can no longer be justified

Real lessons from the 20th century (the professional public service model – a vast improvement over the incompetence and corruption in early 20th century local govt.) - some lessons still applicable (retain & employ what still works)

But so much has changed that what worked last century simply will not work now!

As Starling would say, “We can’t be the Post Office in the age of the Internet.”

The New NormalHere’s the current fiscal health of state and local government in America: (Martin, Levey, & Cawley, 2012)

GAO estimates that collectively local governments face a $225 billion structural budget deficitPew Center for the States (2011) estimates that state and local government pension plans may be underfunded by $1.3–$3 trillion.Municipalities nationwide ended 2010 with the largest year-over-year reductions in general fund revenues and expenditures in the last 26 years (National League of Cities) American Society of Civil Engineers (ASCE) rates the condition of the majority of America’s infrastructure as “mediocre” or “poor.” The ASCE estimates that it may cost up to $3.6 trillion to bring the nation’s infrastructure up to “good” condition (ASCE, 2013) Since 2008, the number of public sector jobs eliminated by just local governments alone has been variously estimated at between 236,000 and 850,000 - many of these jobs will not return when the Great Recession is over & are gone forever.

The New Normal

As the economy recovers, life in local government will be just like it was in the 1990s - this is false

Punctuated Equilibrium resulting in a New Normal - many changes are here to stay and more change will be on the way - no single status quo during a career in local government – change will be the constant – change will be our new culture

Reduced revenues, smaller public sector workforce, tough choices on service levels, and adoption of new means of financing/delivering public services (Martin, Levey, & Cawley, 2012)

Solutions cannot be short term & tactical in nature Solutions must be strategic, structural, & long term We will need to use all of the tools in the toolbox of successful public

managers – we will need to be change leaders.

The New Normal (Martin, Levey, & Cawley, 2012)

Specific Strategies:1. Evaluate current services – mandates, needs, wants, & things we don’t need to be doing (should we be doing this?)

2. Assess current service levels – based upon the evidence, what can we decrease? (how much - at what service level?)

3. Rethink service delivery – crisis offers opportunities for reform – time is now to rethink, reorganize, and reengineer service delivery (how should we deliver this? Make or buy? Contracting, P3s, Grants, Vouchers, Volunteers, Pay for Success) 4. Consider more privatization and less privatization – on a case by case analysis, should we outsource or in-source? Just the mere process of considering new service delivery choices will usually generate cost savings (Goldsmith Model – allow public sector to compete) – In-sourcing City of Palm Coast $2.2 M cost savings

5. Explore more shared services - you don’t have to consolidate govts. to engage in joint service delivery


Specific Strategies6. Identify new revenue streams - improve tax collection – consider user charges where applicable – selling services & cost recapture - diversify from dependence on ad valorem - don’t leave money on the table

7. Un-freeze assets – conduct a lazy assets analysis – inventory & select strategy to enhance, optimize each asset - use P3 concessions and leases of roads, bridges, and facilities to produce new revenue streams for local governments (Chicago Skyway) – sell public property not serving a public purpose

8. Automate, automate, automate – achieve greater efficiencies with IT solutions – (Cloud computing instead of physical storage, Use of advanced analytics, E-government - use of on-line self service for citizens instead of office locations, Waterfall to Agile – “buy success in manageable phases” (IBM, 2012), Knowledge Management)


9. Reform employee health care and pension plans – wellness programs, HDHPs & HSAs, on-site clinics, VBID, eligibility audits, generics, smoker surcharge, self insure, telemedicine – change from DB to DC or hybrid

10. Program Evaluation - We can ill afford to not measure what we do each day - culture of program of evaluation – builds public trust & confidence (Saviak, 2011)

11. Partnerships – for funding, service/program delivery, regulation, and to finance, build, operate, and maintain infrastructure (Saviak, 2013)

The New Normal (Martin, Levey, & Cawley, 2012; Saviak; 2013)

12. Use all tools in the toolbox - need to access the full set of toolsbeyond the traditional 20th century tools of government of legislate, regulate,& direct delivery by govt. (Salamon, 2002)

13. Continuously communicate and effectively educate – conduct honest adult conversations with citizens about services, costs, finances, & choices – make sure they have the facts – the communications burden is yours – also let them know about your successes (no one else will!) – have a communications plan for each major administrative/policy decision – failure to effectively communicate can carry a high price!

In the New Normal, The Monopoly Is Dead (Benest, 1996)

Government no longer has a monopoly – government now competes! Citizens should be seen as customers – citizens now have options – in the 21st century, when the

public does not like your agency or policies or level or quality of service or its cost, the public an do something about it

They can fire your agency – they can still get the service without using you!

Options available to policymakers and taxpayers include: Annexation Consolidation Incorporation – contract cities (Weston, Florida & Sandy Springs, Georgia) Privatization Contract with another public provider Reorganization Reduced funding Service elimination Or just fire staff & start over

In the New Normal, The Monopoly Is Dead (Benest, 1996)

Each local government must now compete for customers & prove & communicate that its policies and services represent the best product at the best price

Citizens will no longer be content with “that’s the way we have always done it”, “you don’t understand”, “it’s none of your business”, etc.

Govt. has to continually explain & justify its spending, policies, & services to win and maintain public support – don’t assume it, prove it!

Citizens cannot just be told – they must also be convinced Program evaluation & effective communications are key – evaluate and communicate!

“Local governments also compete in a marketplace as they attempt to retain and attract residents, businesses, shoppers, tourists, utility and transit users, service customers, and arts patrons. Public agencies compete for people’s cooperation and political support, whether that support involves complying with codes, conserving water, or paying higher trash fees. Realistically, local government cannot force people to do anything unless they are willing to comply. Because citizens are bombarded with communications from all sources, local governments must vie for their attention. Cities and counties literally must compete on a daily basis for people’s hearts and minds.”

Dr. Frank Benest, former City Manager of Palo Alto, California (1996)

Local Government in the 21st Century – Declining Social Capital (Putnam, 1995; 2000)

We regulate human behavior either through private institutions, public institutions & both – as private institutions decline, a greater burden to address needs, solve problems & regulate conduct can be placed on public institutions (informal to formal, internal to external regulation, social norms to laws, private to public institutions/functions)

Social capital – bonding (within group) and building (across groups) – the strength of relationships – degree of connectedness to one another and to others

Social capital helps communities thrive – trust, engagement, networks, norms – enable communities to more effectively organize/mobilize/support/respond to prevent problems, meet needs, & maintain a higher quality of life – strong predictive relationship with quality of governance & quality of life – life is different in communities with low levels of social capital

Local Government in the 21st Century – Declining Social Capital (Putnam, 1995; 2000)

Major decline in social capital in America in recent decades - over the last 25 years:58% decline in club and civic organization participation33% decline in family dinners33% decline in church attendance45% decline in having friends over35% decline in involvement in community life (public meetings)While 55 percent of American adults in 1960 believed others could be trusted most or all of the time, only 30 percent did in 1998, and the future looks bleaker because the decline was sharpest among our nation’s youth. Roughly 75 percent of Americans trusted government to do the right thing most or all the time in 1960, a figure that sounds quaint today when less than 25 percent trust the government.

What does this mean for managers in local government? 1) Design policies which foster social capital, 2) avoid policies which harm social capital, 3) deal with changing citizen expectations, 4) influences decisions on programs & services, 5) managing in an era of distrust, & 6) how to engage citizens?

High Performance Government (Abels & Lee, 2010; Benest, 1996; IBM, 2008; 2011; 2013)

Priority IssuesRedesigning government at all levels from 20th century to effectively operate in and respond to 21st century realitiesCitizen engagement – visioning – articulate values, hopes, & fears – educate! Not passive consumers but active partners in problem-solving - Vending Machine vs. Barn-raising models - Neighborhood EmpowermentMoving away from sole dependence on traditional hierarchical bureaucratic model for organizational structure/service delivery - Service boundaries matter less – service delivery matters more – service delivery will be organized differently (e.g. not one single dept. – networks, collaboration, joint service delivery) – managing horizontally Expect surprises – doing risk management right!

High Performance Government (Abels & Lee, 2010; Benest, 1996; IBM, 2008; 2011; 2013)

Priority IssuesFocus on results – managing for performanceMeeting citizen expectations for on-line, real time, & high quality service – coordinated response/integrated service delivery - being transparent & accountable Culture of Innovation in Government Leadership

High Performance Government – Use of Analytics (Bachner, 2013; Partnership for Public Service, 2013)

Increasing use of analytics by wide range of government agencies at all levels to enhance outcomes & performance – reduce crime, prevent epidemics, improve agriculture

Analytics converts data into actionable information to guide decision-making – identifies patterns, opportunities, and relationships to drive decisions

Analytics confirm predictive relationships - predict & prevent problems before they occur or in real time as they are occurring – confirm causes to select solutions – target limited resources to prevent or react rapidly to the problem

Case Studies

1. CDC – PulseNet – identify food-borne disease outbreaks – identify clusters – collect data from state public health labs - 29:1 ROI – cost-avoidance accounting – monetizing value of prevention

2. Predictive Policing – Santa Cruz PD - Computer algorithm uses criminal incident data to map high probability crime squares each week - top 15 squares in city - officers are briefed, resourced, & concentrated – officers get updated, real time, hot spot maps - raining, easy to understand & use, not mandated to base everything on map but map is another tool – 27% decrease in burglaries

High Performance Government – Use of Analytics (Bachner, 2013; Partnership for Public Service, 2013)

Lessons LearnedStrong support of agency leadership is keyUsers need analytics that deliver actionable information when, where, and how they need it – must be able to easily access and comprehend the tools and modify them to suit their needs – user-centeredData-driven decision-making must become fully integrated into the organizational culture of an agency – “it’s how we do business here”First understand your current operations & objectives to ID data needs & value of analytics - where can I obtain data & where can analytics help?Collaborate with other agencies – capitalize on their knowledge & tools – leverage their data - share successes & lessons learnedCreate a team to manage the initiative who have agency history, analytical abilities, & subject matter knowledgeSell success to incentivize agency leaders & employees to support & use analytics – prove the value of analytics with ROI (CDC 29:1 ROI)

Snapshot of the State & Local Government Workforce (Center for State & local

Govt. Excellence 2013)

75% of survey respondents are from local government.

Key Findings The picture is brightening for the state and local government workforce,

although 33% still report pay freezes and 18% report layoffs. That compares with 51% reporting pay freezes in 2012 and 28% reporting layoffs.

27% report that hiring freezes are in place compared with 42% in 2012. 56% modified health benefits for employees – of those changes, 52%

involved shifting health care costs to employees. 54% made changes to retirement benefits offered to employees. 29% of

current employees saw an increase in their pension contributions, as did 34% of new hires.

74% rated staff development the most important workforce issue in 2013, followed by employee morale (70%), and managing workloads (68%).

Snapshot of the State & Local Government Workforce (Center for State & local

Govt. Excellence 2013)

Reducing employee health care costs, retaining staff needed for core services, & public perception of government workers were also identified as important issues by 60% of more of survey respondents.

The pace of retirements is high, with 22% reporting that employees have accelerated their retirement date. Public employees are retiring from state and local governments in historic numbers in order to avoid impending changes to public pensions and health care (Martin & Saviak, 2014).

When asked if employees were financially prepared for retirement, 44 percent said, “no,” and 18 percent said, “yes.”

Since the economic downturn in 2008, 61% report that their workforce is smaller. 19.5% report it being the same size. Only 7.4% report it being larger compared to 2008.

High Performance Workforce(IBM Center for the Business of Government; Nigro, Nigro, & Kellough, 2007; Starling, 2008)

Managing a Multi-Generational Workforce – 4 different generations on the job at the same time – Traditionalists, Baby Boomers, Gen Ex, & Millenials

Each generation may think, work, & communicate differently – diff. goals & values & expectations

Managerial strategies, tools of communication, benefits (work-life balance much more important to Millenials compared to Traditionalists)

Cross-generational mentoring – Baby Boomers & Gen Teach enhance soft skills (professionalism/social skills) of Millenials and Millenials teach technology to Traditionalists & Baby Boomers


Managing workforce planning – will you be able to effectively fill vacancies with the right talent 1 year, 5 years, 10 years from now? massive change due to Baby Boomer retirements – historic opportunity to remake the organization but a historic amount of institutional knowledge is being lost with retirements of Baby Boomers - need to attract and retain high quality replacements – need to not lose that institutional experience & knowledge (knowledge management) – historic opportunity to reshape the workplace & change organizations with large infusion of new personnel – what is workforce planning? NAPA – “identifying human capital needs required to meet organizational goals & developing effective strategies to fulfill those needs” - need to anticipate future workforce needs and pro-actively design & implement specific solutions for those challenges – solve the problem before it becomes a problem - cannot be reactive in HR in the 21st century - need to recruit and fill positions

Agencies needed to have: 1) strong succession planning, 2) career tracking,

3) mentoring & 4) professional development/training programs or you will have a

big problem! The organization needed to be “learning” while the person was still on

the job so the knowledge does not leave when the employee does – 5) knowledge

management program


Manage talent strategically – recruit, retain, develop, & mange a high performance workforce – to attract, retain, & develop high quality, need 1) flexibility in hiring (incentives, direct hire), 2) professional/leadership development programs, & 3) new types of benefits - child care, telework, student loan repayment, etc. - high demand & real competition for knowledge workers – are you recruiting the talent you actually need now & in the future? (hint: an ad on the website or in the local paper is not recruitment) - you compete with private sector & against other public sector employers too – need for working conditions, wages, benefits, career tracks, organizational culture, management style, other incentives, etc. to be competitive to attract & retain knowledge workers – especially in a recovering economy, these workers have options and they change jobs and careers several times during their working lives (for example, what will happen with your best IT employees when the economy ramps back up?) - Investing in employee training & professional development to ensure needed & changing competencies & skill sets - Public employers will have to sustain ongoing & major investments in workforce planning, training & employee development - need to continuously upgrade skills & technical abilities of employees – the organization needs it, the public expects it, and employees want it – it will cost $ but failure to plan & invest could carry an even higher price tag (it’s just like defer/delay of maintenance with your infrastructure, there’s a point you pass where costs go way up because you did not do it when you should have


Need HR flexibility for managers (some decisional freedom from the central HR office) – critical pay authority (able to offer higher pay for needed competencies & skills), use of buy-outs & early retirement plans, & streamlined hiring

Managing a changing workplace environment – work is not confined to the traditional workplace or workweek – telework, compressed work week (4/10)

Highly diverse & increasingly diverse workforce and service population in Florida

which will affect all aspects of HR – different employee expectations & needs – new and

different generations within the workforce – HR policies need to match the needs &

expectations of changing demographics within the public sector workforce

Offering benefits that match, motivate, & matter - more diverse package of potential

benefits (e.g. not just traditional ones like health insurance – flexible working arrangements)


Manage for Performance – need to link employee performance with agency strategic plans (e.g. how are employees specifically helping to attain agency goals & objectives?)

Performance measurement systems - cannot do the generic traditional single supervisor everyone gets satisfactory useless evaluation

Performance management systems which measure, reward, & recognize performance – pay for performance – paybanding (pay based on qualifications & skills rather than longevity) - pay for performance (be careful about how you design and implement – need to fully fund – need employee buy in)

Public sector HR must clearly contribute to a “culture of performance” where employees are selected, trained, evaluated, promoted, & rewarded for performance as opposed to non-performance criteria (length of tenure – yes, there are legal/political constraints to this) - If there are policy or managerial obstacles to HR contributing to optimizing organizational performance, then it is HR’s role to identify & help remove these barriers to performance – recommend reforms so performance truly matters (recommend organizational policies, HR policies & procedures, incentive & disincentive structures for performance)

High Performance Workforce(IBM Center for the Business of Government; Nigro, Nigro, & Kellough, 2007; Starling, 2008; Spreitzer et al, 2012)

Help make sure that your organizational culture is a positive & productive one - employees internalize the organization’s mission & values (make the mission and values of the organization their own) - the right organizational culture facilitates communication, coordination, attainment of goals, reduces risk & liabilities, ensures consistent performance, enhances retention, sustains morale, boosts productivity & performance, & maintains public trust - tools include selection/onboarding, policy, training, supervision, rewards/discipline, teachable moments, & leadership

Measuring employee satisfaction – employee satisfaction programs – a persistent and high rate of employee dissatisfaction is evident today in all sectors

Make sure your employees thrive! Vitality & Learning. Keep employees healthy, make work meaningful, opportunities to learn, innovate, & lead, provide decision-making discretion, information sharing, minimize incivility, provide performance feedback, & promote diversity

The Public Manager’s Toolbox (Salamon, 2002)

Tools are the means by which policies operate & produce results – pick the righttool for the right job and know how to effectively use and evaluate it – strengths &limitations - avoid selecting the wrong tool or using the right tool the wrong way

1. Re-engineering & Reorganization2. Contracting & Public-private partnerships3. Vouchers4. Grants & subsidies5. Regulation – economic/social6. Distribute benefits7. Government insurance program8. Social marketing9. Needs assessment10. Technical assistance11. Impact fees12. Development agreements 13. Sale, use, exchange of property14. Information technology 15 Tax & Budgetary Policy16. Provide a service or program

Partnerships (Saviak & Christiansen, 2013)

We can effectively partner with other agencies (public-public), non-profit orgs, & private firms (public-private) for:Funding ($) – grants, new revenue streams, cost savingsService/program deliveryRegulationTo finance, build, operate and maintain infrastructure Two counties who build & staff a single fire station at the county line to serve a large development which extends across the borders of both (joint service agreement)Local govt. engaging a private sector partner to handle agency technology needs or a non-profit to deliver a specific program for citizens (contracting)State government partnering with a private firm who will design, build, finance, operate & maintain a major highway to serve a major port city and several counties in a region of the state (public-private partnership) Many success stories across the world & nation – partnerships can help obtain needed expertise and skills, reduce costs, improve service, enhance efficiency, enhance citizen satisfaction, secure financing for infrastructure & deliver new infrastructure on time and on budget Not a silver bullet solution to every problem but it is a potential problem-solver when wisely selected, appropriately designed, effectively implemented, and rigorously evaluated

Partnerships (Salamon, 2002; Cohen & Eimicke, 1998)

To make partnerships successful, managers need to be skilled in: procurement, partner selection, rethinking service/infrastructure delivery, relationship management, contract design and management, risk allocation, and program evaluation

The proposed partnerships must make sense – what’s the rationale - complementary capabilities – each partner does what they do best - benefits outweigh costs for both partners – citizens experience improved outcomes - risks & rewards appropriately allocated – both partners must be “all in”

“Nothing new that is really interesting comes without collaboration.” (Watson & Crick – discovery of the structure of DNA)

Two Types of Partnerships – Contracting and P3s (Martin & Saviak, 2014)

Contracting – for goods & services P3s for infrastructure Renewed interest today in a valuable tool of public management whose

successful use in our country pre-dates our birth as a nation Don’t let policy choices precede research – do the business case analysis each

time Contracting out should not be seen as a challenge to but as an opportunity for

public administration In recent years, many state and local governments have dealt with their budget

deficits is by deferring maintenance on existing infrastructure and delaying the construction of new infrastructure - somewhat helpful in the short term but results in longer term financial problems. Is there another strategy available to state and local governments?

How do we close this funding gap and meet our infrastructure needs for the 21st century?

ContractingContractingit’s the classic Drucker “make or buy” question (Martin, 2001) – this is an evidentiary question – need to collect & analyze the data on all key performance measures & arrived at an evidence-based decision - based on the empirical analysis, will it be direct delivery by government (govt. funds & govt. delivers) or do we choose to purchase outcomes (govt. funds & private sector or non-profit provider delivers)State & local governments contract with both private sector firms as well as nonprofit organizations. Estimates are that state and local governments annually expend between $1.1 and $1.5 trillion on contracting.Eighty percent (80%) of American cities use contracting to some extent.Over 90% of city officials support contracting.Contracting can be described as “guarantor government.” Government guarantees that the service or activity will be provided to citizens, but non-governmental providers do the job.Contracting is based on a buyer/seller relationship. A state or local government becomes the buyer and tells the private sector what it wants to purchase (the process is called procurement) and receives bids or proposals from interested private sector firms (the sellers).

Contracting

The Benefits of ContractingIncreased Competition and ChoiceAbility to Innovate, Reengineer, and RestructureCost SavingsEconomies of ScaleQuality ImprovementTimelinessAccess to Specialized SkillsAbility to Deal with Variable DemandAccess to Intellectual Property

“How can the private sector deliver services and activities at less cost than state and local governments and still make a profit?” Adjusting workforce to work demand. Private sector firms generally make more use of part-time and seasonal employees to smooth out workload peaks and valleys (match workforce to actual service demand – ramp up & ramp down) which government may be less able to do.

Contracting

The Colorado State Auditor’s Office (CSAO) has developed criteria for use in evaluating services and activities for contracting. The CSAO approach has been used by numerous other state and local governments for a number of years. The CSAO approach consists of nine criteria:

(1) market strength, (2) political resistance, (3) service quality,

(4) impact on public employees, (5) legal barriers, (6) risk, (7) resources,

(8) control, and (9) cost.

Managing the Contracting Process

State and local government usually contract using one of three major procurement methods:

1. The invitation for bids (IFB) process

2. The request for proposals (RFP) process

3. The request for qualifications process (RFQ)

The trick in contract management is ensuring that the contract is implemented according to the agreed upon terms and conditions without impinging on the contractor’s independent decision-making

Contracting

Successful ContractingWhat will be our major benefit or benefits and what will be our major challenge or challenges?Single Point of Contact Contract Design –If something is not in the contract, the contractor cannot be held accountable for it. Scope of WorkAbility to Modify the Contract - every contract is considered an “incomplete contract.” Ability to Deal with Disputes Use of Performance-Based Contracts - PBC involves tying payments and contract extensions to the contractor’s accomplishment of output, quality, and outcome performance specifications.Contractor Monitoring – early warning systemRequires a different skill set for public managers Avoid “bureaucratization” of private and non-profit providersSelect the right method of compensation – avoid perverse incentives (Goldsmith & Eggers, 2004)

Public-Private Partnerships (Martin & Saviak, 2014)Public Private PartnershipsThe American Society of Civil Engineers (ASCE) rates the condition of the majority of America’s infrastructure as “mediocre” or “poor.” The ASCE estimates that it will cost $3.6 trillion to bring the nation’s infrastructure up to “good” condition by 2020.National, state, and local governments have successfully employed public-private partnerships to deliver infrastructure and public facilities. P3s are not based solely on a buyer/seller relationship. P3s involve an alliance between government and the private sector with each partner sharing in both the risks and the rewards.

Most Common Public-Private Partnerships (P3s) Airports, Bridges, Highways, Hospitals, Parking Facilities, Prisons, Rail Systems, Roads, Tunnels, Water/Wastewater. As of 2011, 377 public-private partnerships (P3s) have been initiated in 24 states - 104 of these P3s for transportation infrastructure - Florida (16), California (12) and Texas (9) have initiated the greatest number of P3s. P3s run the gamut from the relatively straightforward operations and maintenance (O&M) to design-build (DB) partnerships to the more complex design-build-operate (DBO), design-build-operate-transfer (DBOT), build-own-transfer-operate (BOTO), build-lease-transfer-maintain (BLTM), lease-renovate-transfer-maintain (LRTM) to the most complex design-build-finance-operate-maintain (DBFOM). DB most common. Can structure P3s differently depending on the project & goals/needs/strengths of partners.

Public-Private Partnerships

Benefits:

1)Accelerating infrastructure maintenance and construction

2)Substantial risk transfer from government to the private sector

3)On-time and within budget delivery of infrastructure projects

4)Source of infrastructure funding

5)Cost savings

6)Equal or better quality

Because more risk is transferred to the private sector partner, P3s tend to be completed on-time and within-budget with successful operational startup (e.g. the private sector partner who has paid for the toll road has a lot of incentive to get it built on time and get it producing revenue & ensure quality and safety so that customers use it so they can be repaid & make a profit)

Case Studies: Long Beach Courthouse, Port of Miami Tunnel, Chicago Skyway, I-495 Capital Beltway, Texas State Highway 130, ADOT Highway Reststops

Florida has 2 P3 statutes – both are well designed

F.S. 334.30 – authorizes FDOT to engage in P3s for transportation infrastructure

HB 85 – F.S. 287.05712 Florida’s other P3 statute is for local governments


Strategies for Success:Is there state enabling legislation? What does it allow?Build our institutional capacity – knowledgeable staff In contracting, we manage the contract – in P3s, we manage the relationshipIt’s not the traditional buyer/seller relationship as with contracting for most goods/services especially if it is a DBFOM – different roles & responsibilities for each partner - need to adapt traditional public procurement to the partnership model for P3s – private sector partner providing the $ in DBFOM Different procurement process & tools - use of RFQ followed by RFP/Competitive dialogue/ITN instead of traditional procurement processes (ITB/RFP)Designing/implementing long term contracts (e.g. 30-50-99 years) – treat as “incomplete contracts” - enhanced flexibility, periodic review by partners, user-friendly contract amendment process, dispute resolution mechanism, emphasis on PBC – tools to make the contract perform over the long haul


Strategies for Success:Use of unsolicited proposals – have a policy for this!Project size must be sufficient to attract private sector partners (e.g. US $100M) – use of bundlingNo progress payments – don’t change the incentive structure of the P3! What’s our P3 procurement policy and procedures? Make sure your procurement policies & process conform to Florida law (HB 85, CCNA) – adhere to the comprehensive agreement criteria (HB 85)Badly need a model policy developed to distribute to local governments in Florida – a template that local govts. can start with & tailor to their specific needs Employ best practices & lessons learned from abroad for your policies and contracts - need to utilize international best practices

Public-Private PartnershipsStrategies for SuccessAuthority to use the full range of project financing mechanisms (Iseki et al, 2009)/the ability to accept all forms of potential project financing – for example, all federal assistance or loan programs (Nossaman, 2009; Iseki et al,2009) Broad authority to consider and engage in a diverse range of types of P3 projects (Iseki et al, 2009)Creation of a P3 Unit – specific organizational units should be created to oversee P3s. Contract Provisions - a P3 contract should also: (1) focus on outputs and outcomes rather than inputs & methods used (PBC); (2) identify the number of asset upgrades, if any, and when they are to occur; (3) identify if, when and how much tolls or user fees may be increased; and (4) specify what happens to the asset at the end of the P3 project.Documentation of Decisions and Directions – staff will changeIn P3s, the partner (government or private sector) best positioned to deal with the risk, should assume the risk.

Port of Miami Tunnel P3

The Port of Miami actually sits on an island. Traffic entering and exiting the Port of Miami must do so on surface streets. 26,000 cars each day on those surface streets entering & leaving the port – congestion.

The Florida Department of Transportation (FDOT) has entered into a transportation P3 with a private sector consortium partner, MAT Concessionarie LLC, to design-build-finance-operate-maintain (DBFOM) a tunnel that will connect the port with interstates I-395 and I-95.

The total cost of design and construction of the tunnel is $903 million. The private sector partner contributed $80 million to the project with the remainder of the funding in the form of debt and loans. Once the tunnel is open to traffic, all operating and maintenance costs will be paid by the State of Florida. The FDOT will collect container and passenger fees to provide the revenue stream to fund the partnership.

Construction of the tunnel began in May 2010 and completion is expected by May of 2014. Operational control of the tunnel will revert to the FDOT at the end of the P3 contract in October 2044.

Vouchers (Salamon, 2002; Cohen & Eimicke, 1998) Vouchers – Instead of direct delivery, citizens are given a choice by funded access tomultiple competing providers Examples: GI Bill – another partnership tool3 key issues for public managers to assess in considering use of vouchers to provide public program or service: Choice: When the govt wants the receiver of the good or service to have some choice of the

supplier of the good or service Efficiency: When the govt wants to promote efficiency. A voucher can allow for competition and

thus lower prices Equitable: Vouchers can promote equity and are often driven by concerns with fairness (ex:

children stuck in failing or low performing public schools – low income families provided vouchers) Challenges: Need competition & capacity among providers

Ensuring informed consumers - information asymmetries (when consumer lacks sufficient

information to make choices – providers knows everything & consumer knows little) Evaluate provider performance Potential for adverse selection (customers will select bad providers or providers will end up with

bad customers – screen providers via procurement – match providers to diff. customer groups) Current policy discussion: should we depend on a public sector monopoly (the VA) or give our

veterans the power and choice to pick their doctors and health care providers?

Redesigning Public Pensions & Employee Health Care The traditional implied contract – less pay, more benefits – is changing Collective bargaining agreements - some services in some localities are pricing

themselves out of the market (Benest, 1996) “I can afford 1 fire department – I just cannot fund 2-3 fire departments at the same

time” (Moore, 2011) – cost of retired employee pension/benefits obligations GAO – unfunded state and local govt. retiree health care obligations total $530

billion (Martin et al, 2012) SLGE study – 68% of city & county govts. pushing to have retirees assume more of

their health care costs 85% of state & local govt. employees still in DB retirement programs State & local govt. pension plans underfunded by $1.3-3 trillion (Pew Center, 2011) In 2008, state & local govts. spent about $132 billion annually on employee health

benefits From 1996-2008, the average single employee premium increased 156% - for family

coverage, 169% (Barro, 2011)

Redesigning Health Care (Barro, 2011)

What makes public plans so costly?In the 4th quarter of 2010, public workers earned an average of $4.66 per hour in health benefits compared to an average of $2.08 per hour in the private sector – a difference of 124% The plans are different in the public sector!Lower employee contributions to premiums – 10% less compared to private sectorFewer and smaller co-payments and deductibles – insurance plans pay a greater % of the bills and lower cost sharing increases utilization which increases costs - 75% of private sector employees have a deductible – just under 50% of public employees have one74% of private plans impose a waiting period for eligibility – only 58% of public plans do and when they are required, they are shorter – this means people take jobs with health benefits anticipating a likely claim (adverse selection) which means more costs to the plan Only 20% of private plans offer health benefits to retirees under age 65 (pre-Medicare) but 66% of state & local plans do 99% of full time state & local employees have access to benefits (86% in private sector) and only 16% of public employees waive them (compared to 26% in the private sector)Superior physician networks & higher provider reimbursement rates

Redesigning Public Pensions & Employee Health Care (Brookings, 2014; ALEC, 2013; ICMA, 2013; GFOA, 2011; Barro, 2011)

Employee Health CareIdentify your cost drivers Manage choice of providersManage eligibility – eligibility audit – change time to eligibility Cost sharing – increase contributions, co-pays, & deductibles – variable premium contributionsOffer diversity of plans to employees – 1) High deductible plan & HSAs 2) High deductible, low premium catastrophic insurance policy Self insureImplement wellness, health literacy, disease management, physical fitness programs & smoking cessation programs – reduce utilization – decrease costs Surcharges for smoking – 9 states reward non-smokers & make smokers pay more – 39 states with smoking cessation programs

Redesigning Public Pensions & Employee Health Care (Brookings, 2014; ALEC, 2013; ICMA, 2013; GFOA, 2011; Barro, 2011)

Leverage Points of Cost Management

1.Change benefits

2.Manage plan participant choice of providers

3.Cost sharing with employees

4.Reduce utilization

5.Right combination of outsourcing & insourcing

6.Maximize value

ROI All StarsOnsite clinicsVariable premium contributionsHDHP & HSAsWellness programsSelf-insuranceCooperative purchasingValue-based insurance design disease-management (VBID) – Asheville Model

Redesigning Public Pensions & Employee Health CareCase Studies – The Bailey Group In January of 2013, The Bailey Group transitioned Alachua County School District (client since 2012) from a fully-insured to a self-funded platform. Our conservative estimate shows $5,000,000 in savings for the first year alone with no plan changes or cost-shifting to the employees. This transition was completely seamless to the employee population.In 2006, we took an innovative approach by researching on-site health clinics as an alternative to reducing medical and prescription benefits and increasing premium contributions. In 2007, the on-site health clinic model was presented to St. Johns County School District (SJCSD). After months of analysis and meetings, including but not limited to, insurance committee meetings, board workshops and the final board meeting, SJCSD opened their first on-site health center in May of 2009. The estimated savings for the PPO plan claims was $1.4 million the first year, derived from the reduction of primary care and specialist office visit charges and prescriptions. Due to the success of the first clinic, two more on-site health clinics were opened in November of 2010. The SJCSD Health Clinics provide primary, chronic acute and preventative care services along with occupational and workers compensation services, pharmacy, EAP, lab services and digital x-ray. The Bailey Group has been involved in every aspect of planning, implementing and running the health centers.

Redesigning Public Pensions & Employee Health CareCase Studies – The Bailey Group Focusing on innovative solutions, The Bailey Group introduced a High Deductible Health Plan paired with a Supplemental Bridge product to the benefits portfolio of a non-profit organization in Northeast Florida with approx. 900 employees. The employer absorbed the cost of the bridge product for their employees to assist the employees with the increased deductible. When introduced, the High Deductible plan instantly achieved 80% participation and will save the group over $200,000 in the first year. The employees were thankful to have such a comprehensive plan, and the employer was appreciative of the savings.When conducting a recent dependent audit, we estimated over $300,000 in annual savings for one school district (calculated using average claims per employee per month X the number of dependents found ineligible). Additionally, just last year one of our Account Executives successfully fought to have a $180,000 claim rescinded for a large self-funded client based on incorrect diagnosis coding. It took 8 months, but the carrier finally agreed and neither the employer nor the participant was responsible for the claim.

Redesigning Health Care(GFOA & Colonial Life, 2011)

To succeed with these strategies, local governments should: Secure stakeholder support Use employee benefit committee – they participate in plan decisions – increases buy inProvide employees with benefits value statement with $ costs – educate them about the real costs of HCSell the benefits of specific types of reforms to employees (on-site clinic convenience, HSAs help them accrue savings, self insuring can better match employee needs)Emphasize ROI to decision-makers Compensation study to show public compensation in line with other local governments Implement long term reform incrementally!

Keeping the Promise: State Solutions for Government Pension Reform (Liljenquist, 2013)

“The sad fact is that political calculations give legislators strong incentives to promise generous benefits and few, if any, incentives to make good on those promises.” (p. iii)

Local govt. can go bankrupt & restructure – states cannot States can have increasing pension burdens rob them of discretionary

spending decisions 76 of 126 (60%) major state and local plans below the recommended

80% funding ratio Unfunded liabilities ranging from $730 billion to $4.4 trillion

Redesigning Public Pensions (Brookings, 2014; ALEC, 2013; ICMA, 2013; GFOA, 2011; Barro, 2011)

Specific Potential Pension Reform Solutions Leaders must commit to permanently fixing the problemsYou must confirm the actual scope of the problem Don’t exempt public safety – employees retire earlier so price tags are larger, exempting them may make your reforms legally vulnerable, & citizens support public safety but they also want fiscally sustainable pension plans Know the legal limits (case-law) Effectively communicate – sell reform

Tools of Reform: Delaying retirement (increase age & service requirements)Stop double dipping & eliminate pension spiking (cashing in a large amount of sick leave or OT in the final year of employment)Limit COLAs/make COLAs contingent upon the financial health of the planChange from non-contributory to contributory plansIncrease contribution requirementsChange the calculation of final average salaryDB to DC for new hires, hybrid plans, CB plans Decrease the multiplierPlace a hard cap on pension payouts

Redesigning Public Pensions (Brookings,

2014; ALEC, 2013; ICMA, 2013; GFOA, 2011; Barro, 2011)

How to Sell Pension ReformAssess the Environment for Major ReformDevelop a Winning MessageTalk with System StakeholdersMessage Math not IdeologyReforms need Strong ChampionsAccurate Data & Effectively Communicating Pension Liabilities are KeyProve the Impact of Pensions on Taxes & other Public Spending PrioritiesAnticipate and plan for Legal ChallengesEnsure People Understand that We Cannot Grow Our Way of the ProblemEnsure People Comprehend that Inaction is not an OptionSell Benefits to Public Employees – More take home pay, sound retirementBuild a Strong Support CoalitionIdentify What Can Be Negotiated and What Cannot – meet commitments to current retirees – take steps for a troubled plan (close the plan to new hires, freeze the amount accrued by current participants (do not add to your problems), & move to a more sustainable modelUnderstand that Plan Administrators are in a Predicament as far as Public Statements Go – they don’t want to alarm employees or bring their own management into question – you need them to make accurate statements – use outside expertise too

Strategic Planning (Cohen & Eimicke, 1998)

This process seeks to arrive at the best fit between the organization & its environment so that organizational goals are attained

It is about our mission, our customers, our future – how we will best survive, succeed, & serve for years to come - planning involves identifying threats & opportunities in the future & designing plans which optimize those opportunities and reduce/thwart those threats in the present

Enables us to be pro-active – identifying opportunities to optimize our success - driving events instead of always being driven by them – leading change & playing offense - no longer reacting to the issue of the moment & only playing defense

SP facilitates success in leading and managing change - times change & successful organizations change with them - organizations which fail to anticipate, lead, & manage change will at best compromise their performance or at worst, begin to write their own organizational obituary - “It is futile, for instance, to try to ignore the changes and pretend that tomorrow will be like yesterday, only more so.”(Drucker, 1999)

Given our mission, strengths, weaknesses, opportunities, threats, stakeholders, history, capacity, and resources, what should our objectives be and which strategies can we design and implement to achieve them?

R M G O S T I E

Strategic Planning (Cohen & Eimicke, 1998)

“The temptation in many organizations is to go to a retreat, or go through a strategic planning exercise, develop the strategy, and then ignore it.”

Strategic Planning Need leadership & organizational commitment to the process Resource constraints are important Strategic goals must reflect organizational capability or they will not happen SP connects ends to means SP helps the organization collectively “think” There are risks: 1) Goal definition will have explicit trade-offs – here’s what we will do

and what we don’t do – may spur political opposition from internal and external groups who don’t share those objectives 2) SP can fail – wrong mission, goals, or objectives selected, lack of leadership, lack of capacity, no real commitment, lack of accountability, objectives not measurable or measured, action plans not well designed or effectively implemented, organizational barriers (agency culture, personnel, policies, procedures not geared towards performance), politics/external constraints

Strategic Planning - Benefits to Planning in Public Management (Cohen & Eimicke, 1998)

Clarify our mission, goals and objectives Optimize organizational performance Efficient allocation of limited resources Boost morale – employees internalize the mission Attract resources – it’s easier to get agency stakeholders & citizens to

invest in a winning plan they can see, understand, & support Enhances public confidence – with a clear plan and demonstrated

outcomes, the public can understand and support what our agency is doing Anticipatory government – being prepared for the predictable and there’s

a lot that is capable of being predictable - limit the # of surprises, their duration, & intensity

Enables us to successfully introduce & lead change

Proving Performance – Program Evaluation Program evaluation must be a priority – why?

1. Limited/shrinking resources - in Florida, a multi-year recession and Amendment 1 have

significantly reduced revenues and triggered scrutiny of spending & review of programs by local

govt. - restraints on resources force choices to be made (Rossi et al, 2003).

2. Demand for greater accountability by policymakers & public – Continued &

consistent pressure to constrict or terminate programs that fail to demonstrate effectiveness

and/or efficiency (Rossi et al, 2003).

3. Need to restore public trust & confidence - Program evaluation can demonstrate to the

public that you are operating both effectively and efficiently - program evaluation enables you to

make the case to citizens that you are doing the job right and you are the one to do it for

them.

4. It’s required for $$$ - Program evaluation often is automatically required as a condition of

receipt of a federal or state grant & 1/3 of local government budgets consist of fed. & state grants –

if you like grants, then you need to learn to love program evaluation.

Proving Performance

What is program evaluation/policy analysis and what can it help us do? (Royse, Thyer, Padgett, & Logan, 2006)

Apply the tools of the scientific method to the problems, causes & consequences of public policy - predict which programs would likely work & explain why a policy failed

Help us document need, better allocate resources, aid in program planning & design, aid in program reform or modification, assist policymakers and administrators (executive decision support), identify best practices & replicate them & actually help citizens

It can also aid us in building public confidence that we actually know what we are doing & why we are doing it.

Can enable us to “separate the signal from noise” and determine the real causes of a problem & which policies actually address those true causes to produce better outcomes

Proving Performance

Tools to measure & validate program effectiveness: experimental design quasi-experimental design single system research design meta analysis

Tools to measure & validate program efficiency: data envelopment analysis (DEA) cost benefit analysis (CBA) cost effectiveness analysis (CEA)

Tools to measure & validate program equity: equity evaluation use of major ethical frameworks

*All of these are done & can be done by local agencies**Not always a need to do the study, someone else has probably done it for you (Royse, Thyer, Padgett, & Logan, 2006)

Proving Performance

“What gets measured gets done.

If you don’t measure results, you can’t tell success from failure.

If you can’t see success, you can’t reward it.

If you can’t reward success, you’re probably rewarding failure.

If you can’t see success, you can’t learn from it.

If you can’t recognize failure, you can’t correct it.

If you can demonstrate results, you can win public support.”

- Osborne and Gaebler, Reinventing Government, 1993

Program Evaluation + Effective Communication = Public Support

Proving PerformanceWhat can PE tell us? (Royse, Thyer, Padgett, & Logan, 2006) Program NEED – the extent to which a program meets a community need and the extent to which

a program is reaching its target population Program DESIGN – are the hypothesized relationships between the causes of the problem &

effects of the program correct? Program IMPLEMENTATION – is the program being implemented/service being delivered as

intended? Program EFFECTIVENESS – program outcomes are achieved Program EFFICIENCY – best use of limited resources Program EQUITY - the extent to which all groups of the population are representative of those who

should be and are being served by the program – benefits & burdens shared by all groups in the community

A program whose effectiveness is secured through its inefficiency (got results by dumping

money on the problem) is poorly managed

Can be trade-offs – might increase one at the expense of another - “Cheaper, better, quicker

– pick 2 out of 3 but you might not get all 3”

We cannot assume performance – we must prove it. Have to demonstrate the effectiveness &

efficiency of our programs & services

Organizational Culture(Starling, 2008)

The dominant value system of a workplace - a strong & well defined organizational culture makes communication easier, can boost productivity, facilitates decision making, & can create increased cooperation & commitment

If successful, everyone should both understand and live the organization’s mission, values, & objectives – the personality of the organization – how we do business here

Employees have internalized the mission and values – it is inscribed upon their hearts

You know when you are in an organization with a distinct organizational culture (shared set of values) – you know when you are in a Ritz Carlton or a Publix – there is a clear culture of customer service

You know when you are around a group of United States Marines or the Florida National Guard – there is an easily identifiable sense of mission and shared and specific set of values among them – their culture defines them


Organizational cultures can either be healthy, positive, & productive or unhealthy and dysfunctional

You can have a single culture across the entire organization or different cultures within different departments – the goal is a single healthy positive productive culture across the entire organization!

Make sure that your organizational culture is a positive & productive one – healthy & functional not unhealthy/dysfunctional - The right culture facilitates attainment of goals rather than undermines positive results

You want to avoid allowing subcultures to exist which run counter to the overall organizational culture (e.g. LAPD Ramparts scandal)

In general, tools for establishing & sustaining an organizational culture:

1. Selection – hiring those who share our values

2. Socialization – teaching & reinforcing our values (emphasis on organizational history, use of role models) – never miss a moment to effectively communicate core values


Tools to create the right organizational culture include: Selection - recruit those who share our values Strong policies coupled with solid supervision Establish training programs on proper conduct Effective supervision – you hired the right folks and trained them to policy –

now what? review actions of employees & reward/punish in way that clearly communicates expected conduct - avoid mixed or muddled messages

Promptly & vigorously investigate customer complaints/any allegations of misconduct to protect the integrity of the organization & defend the right organizational culture - have an effective & well respected professional standards office – assures the complaining customer that a good process is in place, can often vindicate the employee, can ensure an employee receives more training/supervision to improve performance, can rightfully remove a wrongdoer

Identify/utilize teachable moments in the life of the organization to communicate & reinforce organizational values

Effective Communication (Kimball, 2011)

Not enough to do a good job – your key constituencies must know you are doing a good job – ineffective communication can stop a good policy or program or hurt a career!

No longer live in a time where “people will take your word for it” or automatically give you the benefit of the doubt - We can no longer assume that we have the public’s trust – we must earn it & work to keep it

Successful public policies do not simply sell themselves (Martin and Saviak, 2012). Without effective communication strategies, stakeholders, citizens, and employees may not

embrace a new policy or managerial initiative Do not assume public understanding and acceptance - can easily fall victim to

misinformation (rumor loves a vacuum – people will fill in the blank) Have a specific, detailed, and actionable communications plan for each major

policy/program or managerial decision & utilize skilled and experienced communications professionals

Do a stakeholder analysis to guide your communication/support strategies Build a support coalition with a diverse set of organizations and individuals to educate the public

- enlist policy/project champions Factual message points – easily comprehended – sell specific benefits

Effective Communication(Wilcox & Cameron, 2009)

Q: Have you done a communications audit to assess your current agency image and the effectiveness of your current communications strategies and tactics? To help you identify communication needs, goals, & opportunities?

Q: If you asked the opinion leaders of your community about your agency or specific services, what would they say?

Q: Does your agency have a plan to build & sustain community support?

Q: Are you effectively and consistently utilizing all available tools of communication – earned media, public awareness campaigns (PSAs), a guest speakers bureau, a community advisory council, weekly e-newsletter to opinion leaders, community survey/neighborhood walk, etc.?

Make sure your communications are research-driven - you have measured awareness, attitude, & behavior via survey research, focus groups & other data sets before you begin communicating – if you cannot conduct primary research, then rely upon valid secondary research – communicating without research is simply flying blind – research enables us to deliver the right message to the right audience through the right channels to secure the right outcomes!

The public image of your agency is rarely created by the PIO alone – many opportunities for both good and bad PR present themselves each day to all employees - it is everyone’s responsibility

Introducing and Managing Change/Innovation in the Public Sector (Drucker, 1999)

“The best change is the change we create.” (Drucker, 1999)

“To try to make the future is highly risky. It is less risky, however, than not to try to make it.” (Drucker, 1999)

Why is it difficult to lead change in the public sector? (Starling, 2008)

Why are there not more innovators in the public sector?Risk avoidanceLack of rewardsPolitical pressureFear of failureWillingness to accept the status quo

Effective public managers identify barriers to change and design and implement strategies to remove them

Management matters and there is no substitute for leadership!

You can do it – there are many public sector success stories of strategic change!

Planned Organizational Change (Kotter, 1996)

Create a sense of urgency – if the need for change is not effectively communicated and perceived as urgently needed, change may not occur

Build a change coalition – create a broad coalition of internal & external actors invested in change - build support at all levels within the organization – identify and neutralize opponents

Create a compelling vision and effective strategy – develop a practical game plan to inspire support by showing the benefits to be realized and how success will be achieved

Communicate the vision effectively – change coalition members must repeat the change message many times & must consistently communicate the behaviors associated with the change through their words and actions

Empower employees to act on the vision – identify and remove barriers to change – provide resources to facilitate action

Produce early and visible victories – nothing sells like success – momentum is created by highly visible short term victories

Build on progress, preserve gains & push forward - align operations with outcomes – reward change agents (personnel is policy – change policies require change personnel)

Institutionalize innovation within the organizational culture – this cements successful change – employees and stakeholders not only embrace this specific change but the culture comes to see change as a positive force in organizational life

Introducing and Managing Change (Drucker, 1999)

Policies to Make the Future: Organized Improvement – create a culture of continuous improvement – recognizes the

need for identifying & implementing improvements in all major aspects of the organization in a systematic and continuing fashion (3% annual improvement rate is possible – 3% fewer errors, 3% growth in productivity, etc.)

Exploiting Success – most monthly reports only discuss problems while ignoring opportunities – “starve problems & feed opportunities” – staff the opportunities – have a problem page & a success sheet in the organization’s monthly report – allocate staff & resources to your successes to build on them just as you direct staff & resources to your problems to reduce them – we should not assume “it’s already successful so I don’t need to add any people or resources to it” – wrong – don’t let success fend for itself – build upon it – don’t miss an opportunity to capitalize on this success

The Doctrine of Organized Abandonment - free the organization of yesterday’s policies which no longer produce results – put every service & action of the organization on “trial for its life” on a regular schedule- abandonment must be a systematic policy – agency holds abandonment meetings at all levels one day a month – now, agencies operate under statutory mandates so you cannot abandon everything, but there may be policies and procedures which can be successfully abandoned

Introducing and Managing Change(Drucker, 1999)

The Right Way to Introduce Change Inside & Outside of the OrganizationPiloting - nothing new is right the first time – pilot new programs – test on a small scale - test their effectiveness & resolve their deficiencies Fund innovation – dedicate a budget to funding new programs – keep funding stable Document unexpected success – “we tend to manage what we see in the reports we receive” – make reporting on unexpected success a regular function so management can see it and exploit these successesReward innovation – tangible rewards to employees who innovate

Look for “windows of opportunity” – a systematic policy of searching the organization & environment for change opportunities

Innovation + Window of Opportunity = Success!

The world is changing & public administration is changing with it New & influential thinking about how we address societal problems & meet public

needs & provide public services – adapt government to 21st century realities –

stop being the Post Office in the age of the Internet! Can it work and would we want to do it if we could? Are these just aspirations/goals

or is it doable? Is a hybrid possible/desirable? Are we now in a period of transition? Is it possible to move from the government model to a governance model?

Retain what works from the old public management while embracing what works

from the new public management.Sources are a number of individuals who are shaping how we think about public administration in the 21st century Sources: Martin

(2005), Rittel and Webber (1973), Cohen and Eimicke (1998), Volcker (1989), Salamon (2002), Drucker (2005), Eggers and Goldsmith (2004), Osborne & Gaebler (1992)

FROM Government TO Governance

GOVERNMENTGOVERNMENT

20th Century mindset

Largely designed to deal with “tame problems”

Top down

Hierarchical bureaucracy – vertical – centralization – single agency solution and it’s a govt. agency that acts if anyone does

Limited set of traditional government tools of command & control - legislate or regulate – try to outlaw it or control it

GOVERNANCEGOVERNANCE

21st Century mindset

Able to effectively manage “wicked problems”

Bottom up

Can employ a coordinated network of public & private actors to solve community problems – horizontal – decentralized approach – multi-partner solution

Wide range of governance tools in addition to command & control – incentives, build capacity, partnerships (i.e. market mechanisms, social marketing/public awareness, vouchers, grants, alternative service delivery systems)

vs.vs.


Problem-solving – “what solves the problem?” is the dominant question

Asks the Drucker “make or buy” question – utilizes performance measures & data (quality, cost, effectiveness, efficiency, specialized skill sets, degree of innovation, etc.) to determine who can best deliver programs & services (public, private, non-profit, partnership model)


Command & Control – “who’s in charge?” is the dominant question

Does not typically ask the Drucker “make or buy” question – govt. “does it all” – produces & delivers all programs and services itself – bureaucratic monopoly

vs.vs.

Governance Flexible Outcome-oriented Calculated and data-driven risk

taking permitted, encouraged, & rewarded

Embraces citizen participation – “we want you to help – let’s find ways for you to help solve the problem”


Rule-bound

Process-oriented

Risk averse

Has difficulty with real citizen participation – “we’ll do it for you”


Flexible

Outcome-oriented

Calculated and data-driven risk taking permitted, encouraged, & rewarded

Embraces citizen participation – “we want you to help – let’s find ways for you to help solve the problem”

vs.vs.


Diminished degree of adaptability – lack of flexibility & speed – inability to rapidly react to changing conditions

Has difficulty initiating or managing strategic change in the organization or the community

One size fits all


Able to better & more rapidly respond to changing conditions

Able to introduce and manage strategic change in the organization or community

Spatially responsive/community targeted/specifically designed programs & services to recognize & successfully address community differences

vs.vs.


Culture of Performance

Customer-centered – highly responsive – asks “Who is the customer?” here & gets the question right – how can I create value for the customer?

Public managers will also employ persuasion & partnerships where appropriate – need to know how to convene, facilitate, negotiate – bring all potential problem solvers to the table

Problem anticipating/ entrepreneurial/innovative/can self-initiate to ID & address problems/pro-active


Culture of Stability (maintain/reinforce status quo)

Needs of bureaucracy can compete with/override customer needs/concerns

Public managers rely on formal legal authority to solve the problem – depend on traditional tools of command & control such as legislation, regulation, enforcement

Problem postponement/problem

avoidance/often reactive

vs.vs.

From Government TO Governance


Problem definition sometimes leads to the wrong response – all public

problems demand government solutions

Program maintenance & continuation through

incrementalism, tradition& anecdote or even as a function

of rules or funding (we have the grant, so let’s keep it going)


Not all community challenges require direct government intervention – what counts is if the problem is solved not who solved it – govt. might need to get out of the way if others can solve or are already solving the problem

Program evaluation – culture of continuous improvement through program evaluation, re-design, reform, termination, resource reallocation from low performing to high performing programs – all based on data & evidence – program maintenance & expansion must be justified by data & performance metrics – ID best practice programs

vs.vs.


Success adjudicated by performance metrics & evidence-based outcomes – performance measured by outcomes (real results – actually improved/solved the problem)

Consistent with public expectations to deliver results – do more on less – could enhance public confidence


Success adjudicated by amount of resources spent (# of people & dollars thrown at the problem) – performance measured by input ($ spent) & outputs (# of tickets written)

Increasingly inconsistent with public expectations – decreased voter confidence & trust in “government”

vs.vs.

Sources Cohen & Eimicke (1998). Tools for Innovators: Creative Strategies for Managing Public Sector

Organizations. San Francisco, CA: Jossey-Bass. Drucker, P. (1999). Management Challenges for the 21st Century. New York, New York: HarperCollins

Publishers. Dye, T. Understanding Public Policy, 13th Edition. Upper Saddle River, New Jersey: Pearson Prentice

Hall, 2010. Karsh, E. & Fox, A. The Only Grant-Writing Book You’ll Ever Need. 3rd Edition. New York: Basic Books.

ISBN 978-0-465-01869-7. Kettner, P. Moroney, R. & Martin, L.L. (1999). “Chapter 11 – Performance Measurement, Monitoring &

Program Evaluation.” In their Designing & Managing Programs. Thousand Oaks: Sage Publications, pp. 215-238.

Kimball, L. (2011). Large scale redevelopment in challenging times. Economic Development Journal, Vol. 10, 3, 39-46.

Kotter J. (2012). Leading Change. Harvard Business Revioew Press. Kotter J. (1999). What Leaders Do. Harvard Business Review Press; 1st edition. Martin, L., Levey, R. & Cawley, J. (2012). The New Normal for Local Government. State and Local

Government Review, 2012 44: 17S. Retrieved from http://slg.sagepub.com/content/44/1_suppl/17S Royse, D., Thyer, B., Padgett, D., Logan, T.K.. Program Evaluation: An Introduction, 4th or 5th Edition.

Belmont: California: Thomson Higher Education, 2006 .

Salamon, L. (2002). The Tools of Government: A Guide to the New Governance. Oxford University Press. Starling, G. (2008). Managing the Public Sector, 8th Edition. Boston, MA: Thomson Higher Education. Wilcox, D. and Cameron, G.. Public Relations: Strategies and Tactics, 9th Edition. Boston,

Massachusetts: Pearson Education, 2009

SourcesFull citations available from Dr. Saviak

New Normal/Local Government in the 21st CenturyThe New Normal – Martin et al (2012)What is the Future of Local Government – Benest (1996)Designing Local Government for the 21st century – Abels & Lee (2010)Bowling Alone: America’s Declining Social Capital – Putnam (1995; 2000)

High Performance GovernmentTen Challenges Facing Public Managers – IBM – Morales & Breul (2008)Six Trends Driving Change in Government – IBM – Chenok et al (2011)Seven Management Imperatives – IBM – Abramson et al (2013)Is The Worst Yet To Come? Kettl (2006)Predictive Policing: Preventing Crime with Data and Analytics – IBM – Bachner (2013)From Data to Decisions III – IBM – Partnership for Public Service (2013)

High Performance WorkforceToward Human Sustainability – How To Enable More Thriving at Work – Spreitzer et al (2012)Chapter 3 – People – IBM Report (2009; 2012)Engaging a Multi-Generational Workforce – IBM – Hannan & Yordi (2011)Chapter 6 – Team Management – Tools for Innovators – Cohen & Eimecke (1998)Nigro L., Nigro F., and Kellough, J.. (2007)

Sources

Redesigning Service Delivery Contracting & P3s – Martin & Saviak (2014)Chapter 14 – Vouchers – The Tools of Government: A Guide to the New Governance – Salamon (2002)

Strategic Planning/Program EvaluationChapter 2 – Strategic Planning - Tools for Innovators – Cohen & Emecke (1998)Summary of the Framework for Program Evaluation – CDC Working GroupChapter 1 – Program Evaluation: An Introduction – Royse et al (2006)

Redesigning Public Pensions & Employee Health CareState Employee Health Benefits – National Conference of State Legislators (2012)Containing Health Care Costs – Government Finance Officers Association (2011) Cadillac Coverage – Barro (2011)Improving Public Pensions – Brookings – Malher, Chingos, & Whitehurst (2014)Keeping the Promise – State Solutions for Government Pension Reform – Liljenquist (2013)

strategies for success in the new normal

Documents