Top Nine Recommendations from The People Factor:
Strengthening America by Investing in Public Service
1. The United States is facing some of its most serious challenges in a half century. Overcoming this crisis will require a new and revitalized federal government on a scale and scope not seen for generations.
After decades in which “big government” was seen as the source of many of the nation’s problems, America is waking up to the realization that government is still important. Most Americans now agree that markets and individual action alone will not keep the country safe, secure and prosperous. The nation has just enacted a package of measures to revive the economy, create jobs, rescue the banking sector and lay the groundwork for health care reform, energy independence and a modern infrastructure. Who will administer these measures and make them successful? America needs a well-functioning public sector, with well-trained, well-equipped public servants to actually run the programs, monitor the spending, award the contracts and do the work. Yet decades of neglect have left the government workforce chronically weak. If we are to keep our country strong, we must reinvest urgently in the government workforce so it is able to succeed. The People Factor: Strengthening America by Investing in Public Service explains how to do this.
2. The federal government is the largest single employer in the United States—we devote one-quarter of the national budget to government salaries and benefits. But in many ways we have neglected government. Nearly half the federal workforce will become eligible for retirement in the next five years, including nearly 90% of the senior executives who run the biggest government programs. In vital areas such as air traffic control, these imminent retirements could seriously impair the nation’s ability to function if we do not act now.
The problems in the civil service have been building over a long period. They are the result of an aging workforce combined with a failure to plan for the future by recruiting and training the next generation of government leaders. The generation called to serve under President Kennedy is retiring. Our failure to attract and retain talented young people in recent decades has created a skills shortage throughout government service that is only going to become more acute. The People Factor offers a detailed blueprint for how to attract the best and the brightest into government. This includes reform of the recruiting and hiring systems, greater use of skills assessments, expansion of internship, mentoring, mid-career hiring and exchange programs, and innovative tools such as an “HR Passport” and the core-ring model.
3. In the past few decades the federal government has been a constant target for public criticism—what we might call a public culture of "gotcha,” in which every mistake is vastly amplified. Congress, the media and the public have tended to view federal workers in terms of costs rather than assets. We need to change this mentality.
For at least 30 years, government “bureaucrats” have fallen out of favor—a mindset epitomized by Ronald Reagan’s statement that “The nine most terrifying words in the English language are ‘I'm from the government and I'm here to help.’” This destructive attitude towards government service, in combination with compensation levels that are further and further below the private sector, discourages talented people from joining government and undermines the morale of current employees. It has also created a climate that discourages innovation and penalizes honest mistakes. Instead of accentuating the negative, we need a culture that recognizes and rewards the dedication of our civil servants and emphasizes the long-term satisfaction of a public service career. This does not mean that we should not hold the federal government to high standards. But we need to think about the federal civilian workforce as a critical resource that requires attention and investment in order to deliver government programs efficiently and effectively.
4. The federal government is turning away talent because of its poor image among students, its rigid personnel system and its slow and cumbersome hiring process.
The federal government needs to hire hundreds of thousands of new applicants a year—but in many cases its own structural deficiencies are preventing the best applicants from being hired. The majority of college students surveyed for The People Factor said they would prefer to work for private or non-profit organizations because the qualities they most looked for in a job—including working for a “caring” employer and being able to rise to the top of an organization—were absent in a government career. They also reported being discouraged from government careers by the difficulty of locating a job, the length of time it took to be hired and the lack of training and mobility.
5. The “People Factor” is a fundamental value system that focuses on motivating every worker by recognizing the importance of his or her contribution to the overall success of the enterprise.
Two decades of empirical evidence show that organizations perform to the highest levels when they invest heavily in their employees. These organizations do better in terms of financial returns, innovation and job creation. In particular, companies that embrace this philosophy have survived and prospered through many economic cycles and have consistently outperformed their peers.
By contrast, the federal government has largely failed to grasp that its workforce is a core asset—one that walks out the door every day. Drawing on best practices from the public and private sector and from the military, the “People Factor” shows how to introduce a culture of people-focus in the federal workforce, leading to substantial gains in workforce productivity. The book presents two compelling case studies from government agencies that show how this approach can be implemented and describe the very substantial gains that resulted.
6. The single most pressing task for the government is to invest in training the federal workforce in leadership and management skills.
Training is fundamental to the long-term success of any organization. A recent survey of U.S. industrial companies shows that training budgets are one of a very few areas of spending likely to increase in 2009 over the prior year. This is because good companies know that the financial payback from training is so high that they are willing to invest in it even during a severe recession. The military also views training as essential to creating an effective organization of individually reliable members. The whole military system is set up to train and support each individual so he or she will be able to accomplish the mission. Professionals, including doctors, lawyers, architects and accountants, are all required to undergo periodic training in order to maintain their credentials. By contrast, the federal government trusts important government workers with similar levels of responsibility for America’s safety, security and health but fails to train them. The United States spends on its civilian government employees less than one-third per capita what private firms and the military spend, and training is one of the first line items to be cut when money gets tight.
This lack of training is out of step with the increasing demands placed on our civil servants. The volume and complexity of government transactions has increased significantly over the past few decades, along with the size of the U.S. population. The typical government manager requires a variety of skills, including the ability to collaborate, to motivate and to manage a wide network of partners including contractors, local government entities and the non-profit workforce. The People Factor calls for a national investment in federal government training through a “Civil Service GI Bill.” This program would include the design and provision of training in leadership, supervisory and managerial skills.
7. There is a strong business case for investing in the workforce. If we invest $10 billion over the next five years, this will lead to $300-$600 billion in productivity gains and cost savings as well as better government service.
Transforming the government workforce to create the skills necessary for the twenty-first century will require a $10.3 billion investment over the next five years. These funds will pay to strengthen the federal workforce, including training and investments in recruiting, mentoring, wellness, benefits, increased mobility and flexibility for employees. We calculate that this investment will pay for itself many times over—and that it is likely to produce a significant return on investment through improved productivity, collaboration, innovation, better budgeting, better design and management of contracts, improved supervision and oversight, and reduced waste and duplication. Such a return on investment is expected to be in the range of $300-$600 billion, depending on the success and speed of implementation.
8. If the United States does not come to grips with the problems affecting the federal workforce, we will continue to witness a steady decline in the way that America is governed.
The immediate consequence of not investing in the public sector workforce is that we risk not being able to fix the economy or that the recovery takes much longer. Over the medium term, the consequence will be increased outsourcing of core government functions to private contractors and others who do not have the same mission focus as the federal workforce. We also risk losing the best and brightest from government, falling behind in important areas such as science, technology and energy development, and delivering mediocre service to our citizens.
Over time, if we don’t take this issue seriously, we may move farther and farther away from the ideal of government public service and the ideal set of rules, regulations and high moral standards that our founders expected from representative government.
9. The country needs to cast off its skepticism and embrace a “yes we can” philosophy toward restoring excitement, prestige and honor to the federal workforce. Solving this challenge is well within our ability as a nation.
Today there is an unprecedented opportunity to reinvigorate the federal workforce, both because there is a general feeling in the country that government work is important, and because the challenges we face are so visible. There is a recognition that the country cannot prosper without a strong public sector.
To implement this program will require leadership, starting with the president and cascading to all levels, including the cabinet, sub-cabinet, senior executives, managers, union leaders, supervisors and all organizations that care about excellence in government. The fundamentals of this reform are well understood and they are achievable with presidential leadership. Many of the recommendations in our book have been cited before in government and academic reports and in two bipartisan national commissions led by Paul Volcker. We urge President Obama and leaders in the administration to host a summit meeting dedicated to public service, and to launch a robust effort to revitalize the federal government workforce.