Marked Improvements

hen the Government Performance Project visited the Patent and Trademark Office for last year's article on the agency, labor-management relations were just plain ugly. PTO Commissioner Bruce Lehman and Ronald Stern, head of the union that represents patent examiners, said there was only one way to end a stand-off between labor and PTO management: One of them had to go.

Lehman left.

In January 1999, Q. Todd Dickinson, former deputy commissioner, took the reins of the agency and turned his attention to resolving the awful labor-management relationship that had led to a huge level of distrust throughout the agency and threatened nearly every effort to improve PTO operations.

"I made it a high priority of mine, for a variety of reasons, not the least of which was the [Government Executive] article," Dickinson says. "There's been a dramatic change in our labor-management relationship just this past year."

Stern echoes Dickinson's report of improved relations.

"We have reached a lot of agreements due to the attention of Todd Dickinson," Stern says. "We've reached more agreements [in 1999] than we have in the past decade. He is a breath of fresh air."

How did Dickinson do it?

For starters, he hired some former Labor Department employees to advise the agency on better labor relations. Dickinson also made some personnel changes among PTO's labor relations staff in the human resources department. And after it had atrophied for years, the agency's labor-management partnership council-a body designed to help prevent tense, long and difficult formal negotiations-was re-established.

But most simply, and perhaps most importantly, Dickinson worked on his personal relationship with representatives of Stern's Patent Office Professionals Association and the two other unions that represent PTO employees.

"I have spent a significant amount of time listening, working with, meeting with all three unions," Dickinson says. "That has paid off in material ways."

Management priorities that had stalled under Lehman have moved forward under Dickinson. Until 1999, the patent examiners union had opposed PTO's pending move from 18 buildings in Arlington, Va., to a single building in Alexandria,Va. While the union still isn't excited about the move, it dropped its opposition after Dickinson and union representatives resolved a dispute over the size of examiners' offices.

After civil service protections for PTO employees were guaranteed, the union dropped its opposition to legislation passed in 1999 transforming PTO into a performance-based organization. Stern cautions that friendly relations have not trickled down through the agency, despite improvements at the top. But he agrees with Dickinson that the agency is moving in the right direction. "We're on the upswing," Dickinson says.

Financial First

Labor-management relations isn't the only area in which PTO made strides in the past year. Financial managers throughout government might look jealously upon PTO's activity-based costing system.

Activity-based costing is a method of determining the true costs of programs. In an agency like PTO, which is fully funded by the fees people pay to have their patent and trademark applications processed, activity-based costing can tell managers whether their fees are covering their costs. In 1999, PTO learned the answer.

"There was a common perception that the trademark side of our operation was basically subsidizing the patent side of the operation," Dickinson says. "When we did the activity-based cost accounting and we aligned the fee structure with the activity, it turned out to be the opposite. It turned out that patents were subsidizing trademarks to the tune of about $20 million, so we needed to realign our fees."

Armed with the activity-based costing data, PTO explained to Congress the need to change fees, which are set by law. Subsequently, Congress lowered the patent fees and-Dickinson chuckles at this-delegated the responsibility of raising the trademark fees to him.

To determine the new fees, Dickinson looked at the budgets of various trademark functions. For example, activity-based costing revealed the appeals board that handles trademark processing complaints costs $11 million a year to run, but took in only $2 million in fees. Dickinson adjusted the appeals fees accordingly.

"I'm told we are the only federal entity that's ever implemented activity-based cost accounting agencywide," Dickinson says. "It's very helpful in terms of our budgeting process because it allows us to get down into the numbers and down into the specific costs of programs to make the kind of informed decisions you have to make about not only whether to keep or retain or modify a particular program, but the impact that kind of modification would have on other programs. This allows for sophisticated judgments to be made that were more difficult in the past."

Performance Picnic

Activity-based costing didn't kick into full gear until 1999, but performance measurement has long been a strong point for PTO management. Patent and trademark examiners are on strict quotas for processing applications, and managers have robust data on how long it takes to get applications in and out the door.

A primary goal for the office is to reduce the amount of time it takes to process applications. The agency must reduce processing time while handling a rapid increase in patent and trademark applications spurred by the country's economic growth in recent years.

The average time applicants had to wait for the office's first action on their trademarks had risen from 6.4 months at the end of fiscal 1997 to 7.2 months at the end of fiscal 1998. Dickinson told trademark managers they needed to find a way to reduce the wait. As a high-impact agency under Vice President Al Gore's National Partnership for Reinventing Government, PTO had committed to a goal of reducing the wait to three months by the end of 1999.

"The managers weren't used to taking this kind of strategic initiative," Dickinson recalls. "Some of them said to me, 'What do you want us to do?' And I said, 'I'm not a trademark manager. I'm not going to tell you how to get there. You tell me how you're going to get there.' "

Dickinson allayed managers' worries about making the wrong decision, and they came back to him early this summer with a 10-point plan to reduce the processing time. By the end of September, despite a 25 percent increase in applications in 1999, the wait time was reduced to 4.5 months-not quite as low as Dickinson had hoped, but still an impressive improvement.

"We took the entire trademark organization out on a picnic in early October to celebrate the fact that they had gotten that significant a decrease in pendency," Dickinson says. PTO also reduced processing time on patent applications, down to 12.9 months in 1999 from 16.9 months in 1998.

Technology Troubles

Of course, for every fire a federal manager extinguishes, another is kindled. For Dickinson, 1999's management fire came in the form of a new computer system.

The old Messenger search system that patent examiners used to help determine the viability of patent applications wasn't Y2K-compliant and was becoming increasingly expensive to maintain because it required custom programming.

The Messenger system was replaced in October by a new system-the Examiner Automated Search Tool (EAST) and the Web-based Examiner Search Tool (WEST). When the new systems went on line, complaints came in from all directions. EAST and WEST were too slow and too hard to use, patent examiners said. So slow, in fact, that the agency extended comp time so examiners would come in early or stay late to spread out usage.

Examiners also had not received adequate training on the new system, they told Dickinson. "It is unforgivable for a federal agency to put systems in place that they don't train people on," Stern says. "If it weren't for Todd Dickinson, the culture of this place would have been to deny the existence of a problem. That culture was overcome by Todd's integrity."

Dickinson got examiners the needed training and ordered the technology staff to improve the new systems. "There are some times when you lay down the law and say you want it fixed," Dickinson says. "Then you get movement."

Despite the EAST/WEST snafu, PTO did score a technology success in 1999: The agency's patent and trademark databases can now be accessed online at www.uspto.gov.

"Allowing our customers, the people who write patent applications, access to the databases, improves the quality of their applications. The quality of what goes out [of PTO] is highly dependent on the quality of what comes in," Dickinson says. In fact, the only complaints about the online databases came from commercial firms that charged people for the same searches that now can be completed on line, for free. GPP report card

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