Measuring Up

elcome to the new era of "Government by Report Card." It brings back fond memories of my college days.

Question: "How did you do with Professor Horn?

Answer: "He's so strict. Gave me an F. Whatever happened to the Gentleman's C?"

Question: "What about Professor Armey?"

Answer: "He's no better. The best in class only got a C. Don't these guys know anything about grading on the curve?"

Whether contending with year 2000 computer problems or trying to create a workable Government Performance and Results Act annual performance plan, agency heads today can expect instant feedback from their congressional overseers. That feedback is simple, direct and, unfortunately for many, painful.

In keeping with national and government-wide trends, it also focuses on results. Grades make you take stock of where you are compared with where you'd like to be. They also let you know how you measure up against others facing similar problems.

Great Expectations

Score cards, report cards and other types of measures are powerful tools for focusing attention. Some might complain the results are biased and the conclusions foregone. Nevertheless, not everyone gets the same grade. The obvious question is why some agencies fare better than others do. What gives them the edge?

Similar questions should be asked of agency procurement shops. During the past few years, various pieces of legislation have been passed and policies promulgated to improve how agencies do business. These range from streamlining and simplification measures to setting new standards for performance. Have they helped? Are tools even available to answer that question?

The answer to both questions is a qualified "yes." First, data are now available to show that at least one innovation-performance-based service contracting-really works. Second, the Procurement Performance Measurement Model, created by an interagency team under the Procurement Executives Association, offers a way to set baselines and measure progress.

Under performance-based service contracting, agencies define performance expectations while contractors come up with approaches for accomplishing the work. The presumed advantages are that government will focus on results, not processes, and contractors will select the most cost-effective ways to meet the government's needs. The results of a pilot project run by the Office of Management and Budget's Office of Federal Procurement Policy confirm these benefits.

Twenty-six contracts, ranging from $100,000 to $325 million, from 15 agencies were reviewed. Their award value was $585 million. Some critics have dismissed performance-based service contracting as applicable only to lower-order contracting such as buying janitorial services. However, the pilot project, in addition to covering this type of work, also looked at complex technical and professional services. The results were positive for both.

Agencies using this technique found it raised customer satisfaction levels almost 20 percent while lowering contract costs 15 percent. The only downside: procurement lead times increased as agency staff learned a new way of doing business. With services contracting totaling about $100 billion annually, and these kinds of results, a shift in approach would seem well worth the effort.

'How Am I Doing?'

While the pilot project measured results on a one-time basis, the Procurement Performance Measurement Model offers a way to track continuous improvement through a series of questionnaires to be answered by procurement office staff and their customers. The survey questions focus on such areas as timeliness, quality, customer service, mission goals and efficiency of operations. There is no better procurement tool for answering the question, "How am I doing?"

The model follows a "balanced scorecard" approach that examines performance not from just one perspective (i.e., costs and profit) but from a combination of viewpoints. For the procurement model these include financial benefits, customer perceptions of how well the process is working, and employee confidence in their organization's professionalism, quality of operations and quest for continuous improvement.

The survey and self-assessment data are arrayed in a chart that demonstrates the success of the procurement office in meeting various performance measures. Data from previous assessments or even performance of other procurement offices can also be displayed. Therefore, both baselines and benchmarks can be established against which to measure progress. Bob Welch, procurement executive at the Commerce Department, says it "has allowed me to begin to move from program measurement to program management."

The model doesn't provide all the answers. For such factors as procurement lead times, for example, it's useful to know how you measure up against other agencies when officials complain that it takes too long to get what's needed. That type of hard data can't be found in the model. But the model does tell you whether customers believe you're meeting their needs. Just by asking the question, you've gone a long way toward gaining a partner.

Allan V. Burman, a former Office of Federal Procurement Policy administrator, is president of Jefferson Solutions in Washington.