This is the accessible text file for GAO report number GAO/GGD-96-118 
entitled 'Executive Guide: Effectively Implementing the Government 
Performance and Results Act' which was released on June 1, 1996. 

This text file was formatted by the U.S. General Accounting Office 
(GAO) to be accessible to users with visual impairments, as part of a 
longer term project to improve GAO products' accessibility. Every 
attempt has been made to maintain the structural and data integrity of 
the original printed product. Accessibility features, such as text 
descriptions of tables, consecutively numbered footnotes placed at the 
end of the file, and the text of agency comment letters, are provided 
but may not exactly duplicate the presentation or format of the 
printed version. The portable document format (PDF) file is an exact 
electronic replica of the printed version. We welcome your feedback. 
Please E-mail your comments regarding the contents or accessibility 
features of this document to 

This is a work of the U.S. government and is not subject to copyright 
protection in the United States. It may be reproduced and distributed 
in its entirety without further permission from GAO. Because this work 
may contain copyrighted images or other material, permission from the 
copyright holder may be necessary if you wish to reproduce this 
material separately. 

United States General Accounting Office: 

Comptroller General of the United States: 

June 1996: 

Executive Guide: 

Effectively Implementing the Government Performance and Results Act: 



In recent years, an understanding has emerged that the federal 
government needs to be run in a more businesslike manner than in the 
past. As companies are accountable to shareholders, the federal 
government is accountable to taxpayers, and taxpayers are demanding as 
never before that the dollars they invest in their government be 
managed and spent responsibly. 

As countless studies by GAO have long noted, federal agencies often 
fail to appropriately manage their finances, identify clearly what 
they intend to accomplish, or get the job done effectively and with a 
minimum of waste. After decades of seeing these problems recur in 
agency after agency, Congress moved to address this endemic situation 
on a governmentwide basis. Major statutes now in their first years of 
implementation hold substantial promise for creating a more 
accountable and effective federal government. 

The Chief Financial Officers (CFO) Act of 1990 provided for chief 
financial officer positions in 24 major agencies and required annual 
reports on the financial condition of government entities and the 
status of management controls. Under the CFO Act, federal agencies 
will be subject to the same kinds of financial reporting that have 
long been required in the private sector and by state and local 

The Information Technology Management Reform Act of 1996 requires, 
among other things, that agencies set goals, measure performance, and 
report on progress in improving the efficiency and effectiveness of 
operations through the use of information technology. 

And, most fundamentally, under the Government Performance and Results
Act of 1993 (GPRA), every major federal agency must now ask itself 
some basic questions: What is our mission? What are our goals and how 
will we achieve them? How can we measure our performance? How will we 
use that information to make improvements? GPRA forces a shift in the 
focus of federal agencies-—away from such traditional concerns as 
staffing and activity levels and toward a single overriding issue: 
results. GPRA requires agencies to set goals, measure performance, and 
report on their accomplishments. 

This will not be an easy transition, nor will it be quick. And for 
some agencies, GPRA will be difficult to apply. But GPRA has the 
potential for adding greatly to government performance-—a particularly 
vital goal at a time when resources are limited and public demands are 
high. To help Congress and federal managers put GPRA into effect, we 
have identified key steps that agencies need to take toward its 
implementation, along with a set of practices that can help make that 
implementation a success. We learned of these practices from 
organizations that successfully have taken initiatives similar to the 
ones required by the act. Several federal agencies that have already 
put these practices to use are represented in the case illustrations 
that are part of this guide. 

This guide is a companion to our Executive Guide: Improving Mission
Performance Through Strategic Information Management and Technology,
which outlined a number of information management approaches that 
federal agencies can take to improve their overall performance. 
Improving the management of federal agencies will require responsible 
actions in several areas at once. Success will demand concerted effort 
and long-term commitment, but the returns should be considerable. And 
American taxpayers deserve no less for their investment. 

Signed by: 

Charles A. Bowsher: 
Comptroller General of the United States: 

[End of section] 




A Changing Environment Demands Federal Management Reform: 

Legislative Requirements Support Managing for Results: 

Experiences of Leading Organizations Show a Way: 

Step 1: Define Mission and Desired Outcomes: 

Practice 1: Involve Stakeholders: 

Case Illustration: Environmental Protection Agency: 

Practice 2: Assess the Environment: 

Case Illustration: United States Customs Service: 

Practice 3: Align Activities, Core Processes, and Resources: 

Case Illustration: Federal Emergency Management Agency: 

Step 2: Measure Performance: 

Practice 4: Produce a Set of Performance Measures at Each 
Organizational Level That Demonstrate Results, Are Limited to the 
Vital Few, Respond to Multiple Priorities, and Link to Responsible 

Case Illustration: National Oceanic and Atmospheric Administration: 

Practice 5: Collect Sufficiently Complete, Accurate, and Consistent 

Case Illustration: National Highway Traffic Safety Administration: 

Step 3: Use Performance Information: 

Practice 6: Identify Performance Gaps: 

Case Illustration: Veterans Health Administration: 

Practice 7: Report Performance Information: 

Case Illustration: GPRA Pilot Projects' Fiscal Year 1994 Performance 

Practice 8: Use Performance Information to Support Mission: 

Case Illustration: Coast Guard: 

Leadership Practices Reinforce GPRA Implementation: 

Practice 9: Devolve Decisionmaking With Accountability: 

Case Illustration: Army Corps of Engineers: 

Practice 10: Create Incentives: 

Case Illustration: Department of Veterans Affairs: 

Practice 11: Build Expertise: 

Case illustration: Department of Defense: 

Practice 12: Integrate Management Reforms Case illustration: Army 
Research Laboratory: 


Appendix I: Overview of the Government Performance and Results Act: 

Appendix II: Objectives, Scope, and Methodology: 

Appendix III: Major Contributors to This Executive Guide: 

Related GAO Products: 


Figure 1: Implementing GPRA: Key Steps and Critical Practices: 

Figure 2: Define Mission and Desired Outcomes: 

Figure 3: Measure Performance: 

Figure 4: Use Performance Information: 

Figure 5: Leadership Practices Reinforce GPRA Implementation: 


ARL: Army Research Laboratory: 

CFO: Chief Financial Officers Act: 

DOD: Department of Defense: 

EPA: Environmental Protection Agency: 

FEMA: Federal Emergency Management Agency: 

GMRA: Government Management Reform Act: 

GPRA: Government Performance and Results Act: 

NHTSA: National Highway Traffic Safety Administration: 

NOAA: National Oceanic and Atmospheric Administration: 

OMB: Office of Management and Budget: 

VA: Department of Veterans Affairs: 

VHA: Veterans Health Administration: 

[End of section] 


A Changing Environment Demands Federal Management Reform: 

Over the past several years, Congress has taken steps to fundamentally 
change the way federal agencies go about their work. Congress took 
these steps in response to management problems so common among federal 
agencies that they demanded governmentwide solutions. In addition, two 
contemporary forces converged to spur congressional action: year-in, 
year-out budget deficits that had to be brought down and a public now 
demanding not only that federal agencies do their jobs more 
effectively, but that they do so with fewer people and at lower cost. 

This was—-and remains-—an enormous challenge. For one thing, many of 
the largest federal agencies find themselves encumbered with 
structures and processes rooted in the past, aimed at the demands of 
earlier times, and designed before modern information and 
communications technology came into being. These agencies are poorly 
positioned to meet the demands of the 1990s.[Footnote 1] Moreover, 
many of these agencies find themselves without a clear understanding 
of who they are or where they are headed. Over the years, as new 
social or economic problems emerged, Congress assigned many agencies 
new and unanticipated program responsibilities. These additions may 
have made sense when they were made, but their cumulative effect has 
been to create a government in which many agencies cannot say just 
what business they are in. 

In some cases, agencies' legislative mandates have grown so muddled 
that Congress, the executive branch, and other agency stakeholders and 
customers cannot agree on program goals, worthwhile strategies, or 
appropriate measures of success. Our work has shown that the 
effectiveness of federal program areas as diverse as employment 
assistance and training, rural development, early childhood 
development, and food safety has been plagued by fragmented or 
overlapping efforts.[Footnote 2] A frequently cited example of overlap 
and ineffectiveness is the federal food safety system, which took 
shape under as many as 35 laws and was administered by 12 different 
agencies yet had not effectively protected the public from major 
foodborne illnesses.[Footnote 3] 

Traditionally, federal agencies have used the amount of money directed 
toward their programs, or the level of staff deployed, or even the 
number of tasks completed as some of the measures of their 
performance. But at a time when the value of many federal programs is 
undergoing intense public scrutiny, an agency that reports only these 
measures has not answered the defining question of whether these 
programs have produced real results. Today's environment is results-
oriented. Congress, the executive branch, and the public are beginning 
to hold agencies accountable less for inputs and outputs than for 
outcomes, by which is meant the results of government programs as 
measured by the differences they make, for example, in the economy or 
program participants' lives. A federal employment training program can 
report on the number of participants. That number is an output. Or it 
can report on the changes in the real wages of its graduates. That 
number is an outcome. The difference between the two measures is the 
key to understanding government performance in a results-oriented 

Legislative Requirements Support Managing for Results: 

Congress' determination to make agencies accountable for their 
performance lay at the heart of two landmark reforms of the 1990s: the 
Chief Financial Officers (CFO) Act of 1990 and the Government 
Performance and Results Act of 1993 (GPRA). With these two laws, 
Congress imposed on federal agencies a new and more businesslike 
framework for management and accountability. In addition, GPRA created 
requirements for agencies to generate the information congressional 
and executive branch decisionmakers need in considering measures to 
improve government performance and reduce costs. 

The CFO Act was designed to remedy decades of serious neglect in 
federal financial management operations and reporting. It provided for 
chief financial officers in the 24 largest federal departments and 
agencies, which together account for about 98 percent of the 
government's gross budget authority. In 1994, Congress followed up on 
the CFO Act with the Government Management Reform Act of 1994. The 
latter extended to all 24 CFO Act agencies the requirement, beginning 
with fiscal year 1996, to prepare and have audited financial 
statements for their entire operations. 

While the CFO Act established the foundation for improving management 
and financial accountability among the agencies, GPRA is aimed more 
directly at improving their program performance. GPRA requires first 
that agencies consult with Congress and other stakeholders to clearly 
define their missions. It requires that they establish long-term 
strategic goals, as well as annual goals that are linked to them. They 
must then measure their performance against the goals they have set 
and report publicly on how well they are doing.[Footnote 4] Federal 
agencies also are to apply these principles—-goal setting, performance 
measurement, and reporting—-to their information technology efforts, 
under the Information Technology Management Reform Act of 1996. For 
example, agencies are to establish performance measures to gauge how 
well their information technology supports their program efforts. 

Experiences of Leading Organizations Show a Way: 

At the request of Congress, we studied a number of leading public 
sector organizations that were successfully pursuing management reform 
initiatives and becoming more results-oriented.[Footnote 5] We studied 
state governments, such as Florida, Oregon, Minnesota, North Carolina, 
Texas, and Virginia; and foreign governments, such as Australia, 
Canada, New Zealand, and the United Kingdom. Many of these 
organizations found themselves in an environment similar to the one 
confronting federal managers today-—one in which they were called upon 
to improve performance while simultaneously reducing costs. Congress 
asked whether the experiences of these organizations could yield 
worthwhile lessons for federal agencies as they attempt to implement 

Each of the organizations we studied set its agenda for management 
reform according to its own environment, needs, and capabilities. Yet 
despite their differing approaches to reform, all these organizations 
were seeking to become more result-oriented, and they commonly took 
three key steps. These were to (1) define clear missions and desired 
outcomes, (2) measure performance to gauge progress, and (3) use 
performance information as a basis for decisionmaking. Although the 
organizations we studied were not acting under GPRA, their three key 
steps were consistent with GPRA'S requirements. That is, the first 
step-—define mission and desired outcomes—-corresponds to the 
requirement in GPRA for federal agencies to develop strategic plans 
containing mission statements and outcome-related strategic goals; the 
second step—-measure performance—-corresponds to the GPRA requirement 
for federal agencies to develop annual performance plans with annual 
performance goals and indicators to measure performance; and the third 
step-—use performance information—-although much broader, includes the 
requirement in GPRA for federal agencies to prepare annual performance 
reports with information on the extent to which the agency has met its 
annual performance goals. 

Along with each step, certain practices proved especially important to 
the success of their efforts. In addition to these steps, these 
organizations also found that certain top leadership practices were 
central to making the changes needed for the organizations to become 
more results-oriented. 

Taken together, the key steps and practices drawn from the 
organizations we studied provide a useful framework for federal 
agencies working to implement GPRA. The key steps and practices are 
shown in figure 1. 

Figure 1: Implementing GPRA: Key Steps and Critical Practices: 

[Refer to PDF for image: illustration] 

Step 1: Define Mission and Desired Outcomes: 
1. Involve stakeholders; 
2. Assess environment; 
3. Align activities, core processes, and resources. 

Step 2: Measure Performance: 
4. Produce measures at each organizational level that: 
* demonstrate results, 
* are limited to the vital few, 
* respond to multiple priorities, and, 
* link to responsible programs; 
5. Collect data. 

Step 3: Use Performance Information: 
6. Identify performance gaps; 
7. Report information; 
8. Use information. 

Reinforce GPRA Implementation: 
9. Devolve decisionmaking with accountability; 
10. Create incentives; 
11. Build expertise; 
12. Integrate management reforms. 

[End of figure] 

In this executive guide, we discuss the three key steps and their 
relationship to GPRA, along with the practices associated with each 
step.[Footnote 6] In the final section of this executive guide, we 
discuss the role of top leadership and the practices it can follow if 
it hopes to make GPRA a driving force in an organization. Accompanying 
the discussion of each practice is a case illustration involving a 
federal agency that has made progress in incorporating the practice 
into its operations. The fact that an organization is profiled for a 
particular practice is not meant to imply success or lack of success 
in other dimensions. Moreover, underscoring the fact that implementing 
management changes required by GPRA will not come quickly, most of the 
agencies profiled began their results-oriented management before GPRA 
was enacted. 

The experiences of leading organizations suggest that the successful 
implementation of GPRA may be as difficult as it is important. For 
example, obtaining agreement among often competing stakeholders is 
never easy, particularly in an environment where available resources 
are declining. In addition, measuring the federal contribution to 
outcomes that require the coordinated effort of numerous public and 
private entities—-such as improvements in education, employment, or 
health-—can require sophisticated and costly program evaluations. 

To help ensure the success of GPRA, the CFO Council, which the CFO Act 
created to provide the leadership foundation necessary to effectively 
carry out the Chief Financial Officers' responsibilities, established 
a GPRA Implementation Committee. The Committee is providing guidance 
and information to Chief Financial Officers and managers in the 24 
agencies covered by the CFO Act. The Committee recognized that 
uncertainty or fear of failure may immobilize an agency's efforts to 
implement GPRA and that its implementation is evolutionary in that 
proficiency comes with time and experience. To assist federal 
managers, the Committee published guiding principles and key issues 
for implementing GPRA.[Footnote 7] Our guide is intended to complement 
the Committee's work in assisting managers as they implement GPRA. Our 
work has shown that although the steps and practices discussed in this 
guide don't come quickly or easily, they can serve as the fundamental 
building blocks to creating a results-oriented organization. 

[End of section] 

Step 1: Define Mission and Desired Outcomes: 

Figure 2: Define Mission and Desired Outcomes: 

[Refer to PDF for image: illustration] 

Step 1: Define Mission and Desired Outcomes: 
1. Involve stakeholders; 
2. Assess environment; 
3. Align activities, core processes, and resources. 

[End of figure] 

GPRA requires that federal agencies, no later than September 30, 1997, 
develop strategic plans covering a period of at least 5 years and 
submit them to Congress and the Office of Management and Budget (OMB). 
OMB provided guidance on the preparation and submission of strategic 
plans as a new part of its Circular No. A-11—the basic instructions 
for preparing the President's Budget—to underscore the essential link 
between GPRA and the budget process. OMB required agencies to submit 
major parts of their strategic plans by June 7, 1996. 

Strategic plans are intended to be the starting point for each 
agency's performance measurement efforts. Each plan must include a 
comprehensive mission statement based on the agency's statutory 
requirements, a set of outcome-related strategic goals, and a 
description of how the agency intends to achieve these goals. The 
mission statement brings the agency into focus. It explains why the 
agency exists, tells what it does, and describes how it does it. The 
strategic goals that follow are an outgrowth of this clearly stated 
mission. The strategic goals explain the purposes of the agency's 
programs and the results they are intended to achieve. 

In crafting GPRA, Congress recognized that federal agencies do not 
exist in a vacuum. As agencies develop their mission statements and 
establish their strategic goals, they are required by the act to 
consult with both Congress and their other stakeholders. Further, 
agencies must be alert to the environment in which they operate; in 
their strategic plans, they are required to identify the external 
factors that could affect their ability to accomplish what they set 
out to do. 

We found that leading results-oriented organizations consistently 
strive to ensure that their day-to-day activities support their 
organizational missions and move them closer to accomplishing their 
strategic goals. In practice, these organizations see the production 
of a strategic plan—-that is, a particular document issued on a 
particular day—-as one of the least important parts of the planning 
process. This is because they believe strategic planning is not a 
static or occasional event. It is, instead, a dynamic and inclusive 
process. If done well, strategic planning is continuous and provides 
the basis for everything the organization does each day. 

For strategic planning to have this sort of impact, three practices 
appear to be critical. Organizations must (1) involve their 
stakeholders; (2) assess their internal and external environments; and 
(3) align their activities, core processes, and resources to support 
mission-related outcomes. 

Practice 1: Involve Stakeholders: 

Successful organizations we studied based their strategic planning, to 
a large extent, on the interests and expectations of their 
stakeholders. These organizations recognize that stakeholders will 
have a lot to say in determining whether their programs succeed or 
fail. Among the stakeholders of federal agencies are Congress and the 
administration, state and local governments, third-party service 
providers, interest groups, agency employees, and, of course, the 
American public. 

In the federal government, stakeholder involvement is particularly 
important as federal agencies face a complex political environment in 
which legislative mandates are often ambiguous. Thus, the basic 
questions that must be answered in crafting a mission statement—what 
is our purpose, what products and services must we deliver to meet 
that purpose, and how will that be done—will present a significant 
challenge for many agencies. While statutory requirements are to be 
the starting point for agency mission statements, Congress, the 
executive branch, and other interested parties may all disagree 
strongly about a given agency's mission and goals. GPRA seeks to 
address such situations by requiring agencies to consult with Congress 
and other stakeholders to clarify their missions and reach agreement 
on their goals. Full agreement among stakeholders on all aspects of an 
agency's efforts is relatively uncommon because stakeholders' 
interests can differ often and significantly. 

Still, stakeholder involvement is important to help agencies ensure 
that their efforts and resources are targeted at the highest 
priorities. Just as important, involving stakeholders in strategic 
planning efforts can help create a basic understanding among the 
stakeholders of the competing demands that confront most agencies, the 
limited resources available to them, and how those demands and 
resources require careful and continuous balancing. Because of its 
power to create and fund programs, the involvement of Congress is 
indispensable to defining each agency's mission and establishing its 
goals.[Footnote 8] This may entail identifying legislative changes 
that are needed to clarify or modify Congress' intent and expectations 
or to address differing conditions and citizens' needs that have 
occurred since the initial statutory requirements were established. 
Congressional consultations also may include additional guidance on 
Congress' priorities in those frequent cases where agencies have more 
than one statutory mission. 

Involving customers is important as well. An agency's customers are 
the individuals or organizations that are served by its programs. This 
is not to say that contact between a federal agency and its customers 
is always direct. Many federally mandated or federally funded services 
are dispensed through third parties, such as state agencies, banks, or 
medical insurance providers. In such cases, federal agencies face the 
particularly challenging task of balancing the needs of customers, 
service providers, and other stakeholders, who at times may have 
differing or even competing goals. 

In our reviews of successful results-oriented organizations, we found 
numerous examples of organizations that achieved positive results by 
involving customers and other stakeholders in defining their missions 
and desired outcomes.[Footnote 9] Oregon, for one, developed consensus 
on its statewide strategic plan by bringing together such diverse 
stakeholders as legislators, state agency officials, county and local 
government officials, and community group representatives. The 
Minnesota Trade Office, for another, used surveys to obtain its 
stakeholders' views on the degree to which the office was contributing 
to its customers' export activities. On the basis of the data it 
obtained, the Trade Office made program changes and improved both its 
performance and its responsiveness. 

Case Illustration: Environmental Protection Agency: 

The Environmental Protection Agency (EPA) was established in 1970 
under a presidential reorganization plan in response to public concerns
Environmental over unhealthy air, polluted rivers, unsafe drinking 
water, and haphazard waste disposal. Congress gave EPA responsibility 
for implementing federal environmental laws. From the start, however, 
EPA lacked an overarching legislative mission, and its environmental 
responsibilities have yet to be integrated with one another. As a 
result, EPA could not ensure that it was directing its efforts toward 
the environmental problems that were of greatest concern to citizens 
or posed the greatest risk to the health of the population or the 
environment itself. Therefore, EPA decided in 1992 to launch the 
National Environmental Goals Project, a long-range planning initiative 
under which it would involve its stakeholders in developing measurable 
goals for EPA to pursue in improving the quality of the nation's 

EPA designed its National Environmental Goals Project to produce a set 
of long-range environmental goals, including milestones to be achieved 
by 2005. The agency recognized that while environmental goals should be 
grounded in science and factual analysis, they should be based, as 
well, on the needs and expectations of the nation's citizens. In 1994, 
EPA initiated a series of nine public meetings to hear their views. 
The meetings were held around the country and included environmental 
organizations, businesses, state and local governments, tribal 
governments, and other stakeholders. To provide a basis for 
discussion, EPA drafted and distributed to participants a set of goal 
statements and descriptive information on the 13 broad environmental 
goal areas that its staff considered to be of the greatest national 

EPA used the information it received at these public meetings to 
revise and better define these goals. For example, the agency added 
milestones for managing and cleaning up radioactive waste, restoring 
contaminated sites to productive use, and slowing habitat losses. 
Further, it added the goal of improving its dissemination of 
environmental information and its other education efforts. EPA found 
that its stakeholders' interests included how EPA does its core 
processes—for example, the amount of flexibility it can offer to the 
regulated community. EPA recognized these stakeholder interests in a 
summary report of its revised goals that it sent to Congress and its 
other stakeholders in February 1995. 

EPA continued to involve stakeholders in the National Environmental 
Goals Project by soliciting comments on the summary report. Many of 
EPA'S stakeholders are businesses or other regulated entities that 
wanted the agency to address such matters as the procedural costs of 
environmental regulations. EPA responded with a discussion of the 
overall costs and benefits of controlling pollution. At its 
stakeholders' request, it provided trend data and laid out strategies 
for achieving its environmental milestones. EPA recognizes that 
involving stakeholders is an ongoing effort that needs to be 
continued. The proposed goals are to be sent again to federal, state, 
local, and tribal government stakeholders for another round of review 
later this year, and plans are being made for public review. 

Practice 2: Assess the Environment: 

Good managers have understood for a long time that many forces—both 
inside and outside their organizations—can influence their ability to 
achieve their goals. But even managers who try to stay alert to these 
forces often gather their information anecdotally or informally. In 
contrast, the successful organizations we studied monitor their 
internal and external environments continuously and systematically. 
Organizations that do this have shown an ability to anticipate future 
challenges and to make adjustments so that potential problems do not 
become crises.[Footnote 10] By building environmental assessment into 
the strategic planning process, they are able to stay focused on their 
long-term goals even as they make changes in the way they intend to 
achieve them. 

Both the external and internal environments are important, and neither 
can be viewed independently of the other. Assessing the external 
environment is particularly important, in part because so many 
external forces that fall beyond an organization's influence can 
powerfully affect its chances for success. For organizations both 
public and private, external forces can include newly emerging 
economic, social, and technological trends and new statutory, 
regulatory, and judicial requirements. An organization's internal 
forces include its culture, its management practices, and its business 
processes. Today, federal agencies find that monitoring these internal 
forces is especially important, given the effects of funding 
reductions and reorganizations. The tools available to organizations 
assessing the internal environment include program evaluations, 
employee surveys, independent audits, and reviews of business 

Case Illustration: United States Customs Service: 

The missions of the Customs Service—-the oldest federal agency-—are to 
ensure that goods and persons entering and exiting the United States 
comply with all U.S. laws and regulations, while also facilitating the 
legitimate movement of goods and persons through U.S. ports. But long-
standing management problems, including weaknesses in strategic 
planning, had threatened the agency's ability to adapt to changing 
demands. Customs' strategic planning efforts now focus on the dramatic 
changes occurring in its external and internal environments and on the 
equally dramatic changes the agency will need to make in response. 

Recognizing that the international trade environment has undergone 
many changes in recent years, the Customs Service identified the new 
challenges these changes brought it in its 1993 strategic plan. The 
clearest challenge for Customs would be to manage a workload that was 
growing rapidly and that could not be expected to taper off. From 
fiscal year 1986 to 1995, for example, total import entries increased 
by 242 percent, from 11.1 million to 38.0 million. During the same 
period, passenger arrivals increased by 42 percent, from 304 million 
to 431 million. Customs anticipated that world trade would also 
continue to accelerate. During 1995 alone, approximately $761 billion 
in merchandise was imported into the United States. For the rest of 
the decade, Customs expects that figure to grow by more than 10 
percent each year. 

Customs anticipated that trade issues would assume greater prominence 
in the coming years as developing countries continue to industrialize, 
corporations continue to expand internationally, and trade barriers 
continue to fall Further, the proliferation of international trade 
agreements, such as the U.S.-Canada Free Trade Agreement of 1989, the 
North American Free Trade Agreement, and the General Agreement on 
Tariffs and Trade, should lead to further increases in trade and 
travel volume. 

Internally, Customs anticipated that as public pressures to reduce the 
federal deficit continued, no real growth would occur in the agency's 
funding. Customs also anticipated attrition among its staff and a loss 
of valuable expertise due to that attrition. It determined that by 
1998 about 10 percent, or about 2,000 employees, would be eligible to 

All of these forces—-external and internal-—have caused the Customs 
Service to begin to reengineer its core processes, including those 
related to the movement of people and cargo into the United States and 
the movement of cargo out of the United States. For example, the 
agency is undertaking a major reorganization structured from the 
ground up, using its 301 ports as its foundation. While headquarters 
staffing is to be streamlined, the staffing levels at the ports are to 
be maintained or increased. Under the reorganization, port directors 
are to be given some of the authority previously exercised at the 
district or regional levels. 

It is too soon to tell how effective Customs' reorganization will be 
in responding to the pressures it faces. But by assessing its external 
and internal environments, the agency came to see that its traditional 
ways of pursuing its mission were no longer viable and that major 
changes would be needed. 

Practice 3: Align Activities, Core Processes, and Resources: 

Leading organizations recognize that sound planning is not enough to 
ensure their success. An organization's activities, core processes, 
and resources must be aligned to support its mission and help it 
achieve its goals. Such organizations start by assessing the extent to 
which their programs and activities contribute to meeting their 
mission and desired outcomes. As the organizations became more results-
oriented, they often found it necessary to fundamentally alter 
activities and programs so that they more effectively and efficiently 
produced the services to meet customers' needs and stakeholders' 
interests. For example, we have traced the management problems of many 
federal agencies to organizational structures that are obsolete and 
inadequate to modern demands.[Footnote 11] As federal agencies become 
more outcome-oriented, they will find that outmoded organizational 
structures must be changed to better meet customer needs and address 
the interests of stakeholders. 

As agencies align their activities to support mission-related goals, 
they should also make better linkages between levels of funding and 
their anticipated results. Under a series of initiatives called 
Connecting Resources to Results, OMB is seeking to adopt a greater 
focus on agencies' goals and performance in making funding decisions. 
For example, OMB fiscal year 1996 budget preparation guidance said 
agencies were to identify key features of their streamlining plans 
(e.g., increased span of control, reduced organizational layers, 
and/or milestones for full-time equivalents) and encouraged agencies 
to include performance goals and indicators in their budget 
justifications.[Footnote 12] Whereas the agencies' fiscal year
1995 documents discussed streamlining primarily in terms of the number 
of positions to be eliminated, the fiscal year 1996 budget documents 
included discussions about how proposed staff reductions could affect 
the agencies' performance. Under OMB'S guidance, agencies' fiscal year 
1997 budget requests were to contain a significantly greater amount of 
performance information to help define funding levels and projected 
program results. For the fiscal year 1998 budget, OMB plans to 
continue to increase the role of performance goals and information in 
guiding funding decisions. 

We also have found that leading organizations strive to ensure that 
their core processes efficiently and effectively support mission-
related outcomes. These organizations rely increasingly on a well-
defined mission to form the foundation for the key business systems 
and processes they use to ensure the successful outcome of their 
operations. For example, many successful public and private 
organizations integrate their human resource management activities 
into their organizational missions, rather than treating them as an 
isolated support function.[Footnote 13] This sort of integrated 
approach may include tying individual performance management, career 
development programs, and pay and promotion standards to 
organizational mission, vision, and culture.

Information management is another activity that organizations must 
address in aligning their activities and processes.[Footnote 14] 
Modern information management approaches, coupled with new information 
technology, can make success more or less likely-—depending on the way 
they are handled. We found that successful organizations pursue 
something called strategic information management-—that is, 
comprehensive management of information and information technology to 
maximize improvements in mission performance. Strategic information 
management will be an important part of any federal agency's attempt 
to implement GPRA successfully. Managing better requires that agencies 
have, and rely upon, sound financial and program information. 
Strategic information management would lead to systems that would 
better provide federal agencies the data they need in considering ways 
to realign their processes, reduce costs, improve program 
effectiveness, and ensure consistent results with a less bureaucratic 
organization. Lacking these data, the agencies would be missing one of 
the indispensable ingredients of successful management. 

Case Illustration: Federal Emergency Management Agency: 

Established in 1979, the Federal Emergency Management Agency (FEMA) is 
responsible for the coordination of civil emergency planning and 
mitigation as well as the coordination of federal disaster relief FEMA 
is responsible for responding to floods, hurricanes, earthquakes, and 
other natural disasters. Hurricane Hugo and the Loma Prieta earthquake 
in 1989 generated intense criticism of the federal response effort. 
Hurricane Andrew, which leveled much of South Florida in 1992, raised 
further doubts as to whether FEMA was capable of responding to 
disasters. In 1993, FEMA'S new Director refocused the agency on 
meeting its mission and aligning its activities to better serve the 

Since FEMA issued its mission statement in April 1993, it has been 
reexamining its approach to limiting deaths and property losses from 
disasters. Traditionally, FEMA had concentrated its efforts on post-
disaster assistance. But after taking a hard look at its performance, 
FEMA concluded that it could better fulfill its mission by addressing 
the range of activities available before, during, and after disaster 

As part of its first agencywide strategic planning effort, FEMA 
comprehensively reviewed its programs and structures and initiated a 
major reorganization in November 1993. FEMA concluded that all 
emergencies share certain common traits, pose some common demands, and 
ought to be approached functionally. FEMA'S new, "all-hazard" mission 
takes a multifaceted, sequential approach to managing disasters:
mitigation, preparedness, response, and recovery. 

FEMA now focuses its disaster planning and response processes on steps 
that need to be taken, not just during and after the event, but in 
advance. To build preparedness, FEMA now seeks to build partnerships 
with other federal, state, and local organizations. For example, the 
agency is working with local governments and the building industry to 
strengthen building codes so that structures will be better able to 
withstand disasters. It has also launched an effort to increase the 
number of flood insurance policyholders-—something that had not been a 
traditional focus of the agency but that is now understood as being 
critical to helping individuals recover from disasters. By more 
closely aligning its activities, processes, and resources with its 
mission, FEMA appears today to be better positioned to accomplish that 

[End of section] 

Step 2: Measure Performance: 

Figure 3: Measure Performance: 

[Refer to PDF for image: illustration] 

Step 2: Measure Performance: 
4. Produce measures at each organizational level that: 
* demonstrate results, 
* are limited to the vital few, 
* respond to multiple priorities, and, 
* link to responsible programs; 
5. Collect data. 

[End of figure] 

The second key step that successful results-oriented organizations we 
studied take—-after defining their missions and desired outcomes—-is 
to measure their performance. Measuring performance allows these 
organizations to track the progress they are making toward their goals 
and gives managers crucial information on which to base their 
organizational and management decisions. Leading organizations 
recognize, as well, that performance measures can create powerful 
incentives to influence organizational and individual behavior. 

GPRA incorporates performance measurement as one of its most important 
features. Under the act, executive branch agencies are required to 
develop annual performance plans that use performance measurement to 
reinforce the connection between the long-term strategic goals 
outlined in their strategic plans and the day-to-day activities of 
their managers and staff. The annual performance plans are to include 
performance goals for an agency's program activities as listed in the 
budget, a summary of the necessary resources to conduct these 
activities, the performance indicators that will be used to measure 
performance, and a discussion of how the performance information will 
be verified. For the first time, GPRA requires that agencies' annual 
program performance planning efforts be linked directly to their 
budget estimates and obligations. This linkage is achieved by 
requiring performance goals and measures for agencies' program 
activities that are included in their budget requests. Congress 
recognized that the activity structure in the budget of the United 
States government is not consistent across various programs. As a 
result, Congress expects agencies to consolidate, aggregate, or 
disaggregate the lists of program activities appearing in the budget 

The first of these annual performance plans is to cover fiscal year 
1999; each agency is to submit its plan to OMB in the fall of 1997. 
However, OMB is requiring descriptions of the proposed performance 
goals and indicators for fiscal year 1999 with the agency's fiscal 
year 1998 budget request. 

In developing GPRA, Congress recognized that federal agencies—-
unaccustomed as they are to the practice—-may find that developing 
performance measures is a difficult and time-consuming task.
As a result, it provided for selected agencies and programs to pilot 
GPRA'S goal-setting and performance measurement requirements before 
these are applied governmentwide. Our work with leading results-
oriented organizations confirmed that many agencies may need years to 
develop a sound set of performance measures. 

We learned, as well, that agencies that were successful in measuring 
their performance generally had applied two practices. First, they 
developed performance measures based on four characteristics. These 
measures were (1) tied to program goals and demonstrated the degree to 
which the desired results were achieved, (2) limited to a vital few 
that were considered essential for producing data for decisionmaking, 
(3) responsive to multiple priorities, and (4) responsibility-linked 
to establish accountability for results. Second, recognizing that they 
must balance their ideal performance measurement systems against real-
world considerations, such as the cost and effort involved in 
gathering and analyzing data, the organizations we studied made sure 
that the data they did collect were sufficiently complete, accurate, 
and consistent to be useful in decisionmaking. 

Practice 4: Produce a Set of Performance Measures at Each 
Organizational Level That Demonstrate Results, Are Limited to the 
Vital Few, Respond to Multiple Priorities, and Link to Responsible 

As the leading organizations we studied strive to align their 
activities and resources to achieve mission-related goals, they also 
seek to establish clear hierarchies of performance goals and measures. 
Under these hierarchies, the organizations try to link the goals and 
performance measures for each organizational level to successive 
levels and ultimately to the organization's strategic goals. They have 
recognized that without clear, hierarchically linked performance 
measures, managers and staff throughout the organization will lack 
straightforward roadmaps showing how their daily activities can 
contribute to attaining organizationwide strategic goals and mission. 
Federal agencies that are developing such hierarchies for their 
organizations are finding that organizationwide performance 
measurement efforts take time and require the active involvement of 
staff at all organizational levels. 

The experiences of leading state, foreign, and federal governments 
show that at least four characteristics are common to successful 
hierarchies of performance measures.[Footnote 15] These 
characteristics include the following: 

Demonstrate results: Performance measures should tell each 
organizational level how well it is achieving its goals. Yet, simple 
as this principle may appear, it poses an especially difficult 
challenge for federal managers, for whom the link between federal 
efforts and desired outcomes is often difficult to establish and may 
not, in fact, be apparent for years. Research programs provide one 
example. So do many health and welfare programs that are delivered 
jointly with state and local governments and third-party service 

Limited to the vital few: The number of measures for each goal at a 
given organizational level should be limited to the vital few. Those 
vital few measures should cover the key performance dimensions that 
will enable an organization to assess accomplishments, make decisions, 
realign processes, and assign accountability. Organizations that seek 
to manage an excessive number of performance measures may risk 
creating a confusing excess of data that will obscure rather than 
clarify performance issues. Limiting the number of performance 
measures to the vital few at each organizational level will not only 
keep the focus where it belongs, it will help ensure that the costs 
involved in collecting and analyzing the data do not become 
prohibitive. As a result, lower organizational levels may use 
different measures and goals from those meaningfully or appropriately 
included in the organization's annual performance plan. Likewise,
agencies will have more goals and measures than can be meaningfully or 
appropriately included in the governmentwide performance plan OMB will 
develop under GPRA. However, as performance plans are compiled for 
higher organizational levels, the consolidation and possible exclusion 
of some goals and measures does not mean that those goals and measures 
are not important to guide the efforts of the lower levels and should 
still be monitored. 

Respond to multiple priorities: Government agencies often face a variety
of interests whose competing demands continually force policymakers 
and managers to balance quality, cost, customer satisfaction, 
stakeholder concerns, and other factors. Performance measurement 
systems must take these competing interests into account and create 
incentives for managers to strike the difficult balance among 
competing demands. Performance measurement efforts that overemphasize 
one or two priorities at the expense of the others may skew the 
agency's performance and keep its managers from seeing the whole 

Link to responsible programs: Performance measures should be linked
directly to the offices that have responsibility for making programs 
work. A clear connection between performance measures and program 
offices helps to both reinforce accountability and ensure that, in 
their day-to-day activities, managers keep in mind the outcomes their 
organization is striving to achieve. This connection at the program 
office helps to lay the groundwork for accountability as measures 
advance through the agency. By helping to lay the groundwork for 
accountability, a connection between performance measures and program 
offices also provides a basis for determining the appropriate degree 
of operational authority for various organizational levels. Managers 
must have the authority and flexibility for achieving the results for 
which they are to be held accountable. 

Case Illustration: National Oceanic and Atmospheric Administration: 

The mission of the National Oceanic and Atmospheric Administration 
(NOAA) is to describe and predict changes in the earth's environment, as
well as to conserve and manage the nation's coastal and marine 
resources to ensure sustainable economic opportunities. NOAA concluded 
in its 1995 strategic plan that the nation's ability to prepare for 
severe weather events, including tornadoes, thunderstorms, hurricanes, 
and flash flooding, depends on the quality and timeliness of the 
agency's observations, assessments, and information delivery. Through 
strategic planning, NOAA evaluated how best to accomplish its mission 
and then put into place those performance measures essential to 
demonstrating the extent to which it was attaining its desired 

NOAA determined that the most important business of its short-term 
warning and forecast weather services was to predict the time and 
location of weather events and to do so with accuracy. Rather than 
simply count the number of forecasts it made—that is, to simply gather 
data on its activity level—NOAA began to measure the extent to which 
it could increase the lead time or advance notice it gave the public 
prior to severe weather events. It decided, in other words, to measure 
what counts. 

NOAA reported that from fiscal year 1993 to fiscal year 1995, its lead 
time for predicting tornadoes increased from 7 minutes to 9 minutes, 
and the accuracy of its predictions increased from 47 percent of the 
time to 60 percent of the time. For fiscal year 1996, NOAA has set 
targets of 10 minutes and 64 percent, respectively. 

NOAA also measured how accurately it could predict the range where 
hurricanes would reach land, given a 24-hour lead time. From fiscal 
year 1993 to fiscal year 1995, its accuracy improved from 185 
Idlometers (115 miles) to 134 kilometers (83 miles). It credited the 
improvement to its installation in June 1995 of a new hurricane 
tracking model. On the basis of fiscal year 1995 performance, NOAA 
revised its fiscal year 1996 target from 155 kilometers (96 miles) to 
150 kilometers (93 miles). Although the new fiscal year 1996 target of 
150 Idlometers is higher than the fiscal year 1995 actual performance 
of 134 kilometers, NOAA wants to test the new model through at least 
another hurricane season before radically revising its targets for 
future years. 

The significance of earlier and more accurate hurricane warnings is 
enormous. Most importantly, they help prevent deaths and injuries. But 
they also save money, because earlier and more accurate predictions of 
hurricane tracks and intensities can reduce the size of the warning 
areas in which people are advised to prepare for the event. NOAA 
calculated that for each hurricane, the public's preparation and 
evacuation costs exceed $50 million, but improved predictions can cut 
that cost by $5 million. In addition, NOAA officials believe that the 
public takes more accurate forecasts more seriously-—which helps 
lessen loss of life and property. 

Practice 5: Collect Sufficiently Complete, Accurate, and Consistent 

As the organizations we examined developed their performance measures, 
they paid special attention to issues relating to data collection. 
Although they recognized that adequate and reliable performance data 
are indispensable to decisionmaking, they were also aware that 
collecting the data can be costly and difficult. As a result, as 
agencies implement GPRA, they will have to balance the cost of data 
collection efforts against the need to ensure that the collected data 
are complete, accurate, and consistent enough to document performance 
and support decisionmaking at various organizational levels. 

As the experiences of these organizations demonstrated, managers 
striving to reach organizational goals must have information systems 
in place to provide them with needed information.[Footnote 16] In 
Texas, for example, officials said that the state restructured its 
statewide information systems to include the missions and goals of its 
agencies, specific strategies for achieving objectives, and measures 
of progress. The system also linked budgeted expenditures, accounting 
information, and performance data. 

Our work has shown consistently that the federal government's basic 
financial and information management systems are woefully out of date 
and incapable of meeting modern needs for fast, reliable, and accurate 
information—particularly as these needs relate to financial reporting 
and program costs. As the leading organizations we studied became more 
results-oriented, many of them made significant investments in their 
information management systems. Many federal agencies will need to do 
the same. But agencies can keep costs down by applying the performance 
measurement principles these leading organizations have employed and 
also-—where they can—-by building performance data collection into the 
processes that govern daily operations, rather than creating entirely 
new and separate data collection systems. 

Case Illustration: National Highway Traffic Safety Administration: 

The National Highway Traffic Safety Administration's (NHTSA) mission 
is to reduce casualties and economic losses resulting from motor vehicle
crashes. To accomplish its mission, NHTSA pursues two main strategies: 
setting and enforcing safety performance standards for motor vehicles 
and promoting safe driving behavior. After it was established in 1970, 
and concluded that reliable crash statistics databases were needed. 
The need was twofold: to help in identifying and analyzing traffic 
safety problems and for evaluating the effectiveness of motor vehicle 
safety standards and highway safety initiatives. To fill this need, 
NHTSA developed data collection systems derived from existing data 
sources and has taken steps to ensure the completeness, accuracy, and 
consistency of these data. 

NHTSA has developed two data systems that, taken together, serve as a 
single source of motor vehicle crash statistics. The Fatal Accident

Reporting System has enabled NHTSA to document that the rate for one 
of its desired outcomes—-reduction in the fatality rate-—decreased 
from 2.3 to an estimated 1.7 per 100 million vehicle miles of travel 
from 1988 to 1995.[Footnote 17] Also, NHTSA has used data from the 
General Estimates System to document another one of its desired 
outcomes—-a reduction in injury rates-—from 169 to an estimated 138 
injuries per 100 million vehicle miles of travel from 1988 to 1995. 

The Fatal Accident Reporting System contains accident data provided by 
the 50 states, Puerto Rico, and the District of Columbia. According to 
NHTSA documents, throughout the states, Puerto Rico, and the District 
of Columbia, trained state employees gather and transmit these data to 
NHTSA'S central computer database in a standard format. State 
employees obtain data solely from each state's existing documents—-
including police accident reports, vehicle registration files, and 
vital statistics records—-and then enter them into a central computer 
database. NHTSA analysts periodically review a sample of the cases. 

The General Estimates System contains data from a nationally 
representative sample of police-reported accidents. To compile the 
database, NHTSA data collectors randomly sample about 48,000 reports 
each year from approximately 400 police jurisdictions in 60 sites 
across the country, according to NHTSA documents. NHTSA staff then 
interpret and code the data directly from the reports into a central 
electronic data file. The data are checked for consistency during both 
coding and subsequent processing. 

NHTSA has recognized that its data have limitations. For example, the
General Estimates System is based on police reports, but various 
sources suggest that about half of the motor vehicle crashes in the 
country are not reported to police, and the majority of these 
unreported crashes involve only minor property damage and no 
significant injury. A NHTSA study of the costs of motor vehicle 
injuries estimated the total count of nonfatal injuries at over 5 
million compared to the General Estimates System estimate for that 
year of 3.2 million. NHTSA intends to study the unreported injury 

[End of section] 

Step 3: Use Performance Information: 

Figure 4: Use Performance Information: 

[Refer to PDF for image: illustration] 

Step 3: Use Performance Information: 
6. Identify performance gaps; 
7. Report information; 
8. Use information. 

[End of figure] 

The third key step in building successful results-oriented 
organizations—-after establishing an organizational mission and goals 
and building a performance measurement system-—is to put performance 
data to work. Managers should use performance information to 
continuously improve organizational processes, identify performance 
gaps, and set improvement goals.[Footnote 18] 

When the CFO Act and GPRA are fully implemented, decisionmakers are to 
routinely receive the performance and cost information they need to 
assess their programs and make informed decisions. Congressional 
decisionmaking should also benefit. GPRA was intended, in part, to 
improve congressional decisionmaking by giving Congress comprehensive 
and reliable information on the extent to which federal programs are 
fulfilling their statutory intent. The act requires that each agency 
report annually to the President and to Congress on its performance—-
specifically, on the extent to which it is meeting its annual 
performance goals and the actions needed to achieve or modify those 
goals that have not been met. Annual performance reports are intended 
to provide important information to agency managers, policymakers, and 
the public on what each agency accomplished with the resources it was 
given. The first of these reports, covering fiscal year 1999, is due 
by March 31, 2000. 

In crafting GPRA, Congress recognized that different information users 
would have differing information needs. Federal agencies must 
determine what information is both relevant and essential to different 
internal and external information users and include only the 
information the users require.[Footnote 19] Most important, agency 
managers need performance information to ensure that programs meet 
intended goals, assess the efficiency of processes, and promote 
continuous improvement. Congress needs information on whether and in 
what respects a program is working well or poorly to support its 
oversight of agencies and their budgets.[Footnote 20] Agencies' 
stakeholders need performance information to accurately judge program 

In short, we have found that leading organizations that progressed the 
farthest to results-oriented management did not stop after strategic 
planning and performance measurement. They applied their acquired 
knowledge and data to identify gaps in their performance, report on 
that performance, and finally use that information to improve their 
performance to better support their missions. 

Practice 6: Identify Performance Gaps: 

Performance data can have real value only if they are used to identify 
the gap between an organization's actual performance level and the 
performance level it has identified as its goal. Once the performance 
gaps are identified for different program areas, managers can 
determine where to target their resources to improve overall mission 
accomplishment. When managers are forced to reduce their resources, 
the same analysis can help them target reductions to keep to a minimum 
the threat to their organization's overall mission. 

The leading organizations we studied recognized that improvement goals 
should flow from a fact-based performance analysis and be rooted in 
organizational missions.[Footnote 21] Such organizations typically 
assess which of their processes are in greatest need of improvement in 
terms of cost, quality, and timeliness. By analyzing the gap between 
where they are and where they need to be to achieve desired outcomes, 
management can target those processes that are in most need of 
improvement, set realistic improvement goals, and select an 
appropriate process improvement technique.[Footnote 22] One technique 
these organizations used is benchmarking—comparing their processes 
with those of private and public organizations that are thought to be 
the best in their fields. By benchmarking its own processes against 
those of the best in the business, an organization can learn how much 
change it needs to make and what changes might be the right ones. 

Case Illustration: Veterans Health Administration: 

The Veterans Health Administration (vim) in the Department of Veterans 
Affairs runs one of the nation's largest medical care delivery 
systems, consisting of a network of medical centers, nursing homes, 
domiciliaries, and outpatient clinics that provide health care 
services to nearly 2.8 million patients each year. vim recognizes that 
its ability to survive growing market pressures, answer criticisms of 
health care quality, and sustain and improve services to an aging 
veteran population depends on its ability to analyze data to pinpoint 
areas needing change and improvement. via has initiated numerous 
studies to identify performance gaps. With better data in hand, via is 
taking actions to improve its products and services. 

VHA has provided medical care to veterans for over 60 years. 
Traditionally, however, the agency has lacked the sort of data needed 
to assess the quality, cost, and effectiveness of its care. VHA'S 
current data analysis efforts are structured to provide caregivers 
with improved data on medical outcomes. It has begun to use this 
performance information to improve service to veterans. 

An example is VHA'S effort to benchmark the success of cardiac 
surgeries in VHA facilities. VHA'S database, which contains over 
51,000 records on cardiac surgical outcomes, is risk-adjusted for 
severity of illness on the basis of 54 variables, including age and 
previous medical history, collected prior to surgery. VHA was able to 
identify the differences in surgical outcomes among the 43 VHA medical 
centers performing cardiac surgery. On the basis of these analyses, 
VHA recommended a number of techniques and processes for shortening 
the postoperative hospital stay, decreasing excessive diagnostic 
testing, and reducing the risk of postoperative infections or 
complications. According to VHA, because it adopted these and other 
techniques, the performance data show that cardiac teams lowered their 
mortality rates for all cardiac procedures over the last 8 years by an 
average of 13 percent. 

Another VHA data analysis effort is the External Peer Review Program. 
The program compares VHA medical centers' performances against 
established community standards. As part of the effort, panels 
composed of physicians not affiliated with VHA review medical records 
to determine if community standards have been met. One performance gap 
VHA identified through this benchmarking was the low vaccination rate 
of elderly and chronically ill VHA patients who are at high risk for 
contracting one type of potentially fatal pneumonia. VHA has worked 
with the National Institute on Aging in the Department of Health and 
Human Services and the American Lung Association to raise its 
pneumonia immunization rate for these patients from 19 percent to 29 
percent over the past 2 years. 

VHA also is analyzing performance data to switch some of its focus 
from inpatient to ambulatory care. For example, according to VHA, 
after careful data analysis, its medical center in Little Rock, 
Arkansas, determined that only a small percentage of the patients 
admitted to its 28-day inpatient detoxification program needed acute 
medical attention. As a result, the program was converted in fiscal 
year 1995 to an outpatient program with only a small inpatient 
capacity. The center reportedly now serves more patients with eight 
fewer full-time staff members and anticipates that savings from the 
first year of the new outpatient program will be $600,000-—with no 
lessening in the quality of patient care. 

Practice 7: Report Performance Information: 

No picture of what the government is accomplishing with the taxpayers' 
money can be complete without adequate program cost and performance 
information. But this information must be presented in a way that is 
useful to the many audiences who rely on it to help them assess and 
manage federal programs.[Footnote 23] Viewing program performance in 
light of program costs—-for instance, by establishing the unit cost 
per output or outcome achieved—-can be important on at least two 
levels. First, it can help Congress make informed decisions. Second, 
it can give the taxpayers a better understanding of what the 
government is providing in return for their tax dollars. 

Consistent with GPRA'S requirement that annual performance plans be 
tied to budget requests, the annual performance reports, which are to 
report progress toward achieving the goals established in the plans, 
are to link levels of performance to the budget expenditures. Directly 
calculating unit cost information will likely become more widespread 
when the Government Management Reform Act of 1994 (GMRA) is 
implemented. GMRA authorized OMB, upon proper notification to 
Congress, to consolidate and simplify management reports. The CFO 
Council has proposed that agencies prepare two annual reports: a 
Planning and Budgeting Report and an Accountability Report. The two 
consolidated reports would be used to present each agency's past 
financial and program performance and provide a roadmap for its future 
planning and budgeting actions. At present, OMB is having six agencies 
produce Accountability Reports on a pilot basis. The Accountability 
Report would eliminate the separate requirements under various laws—
such as GPRA, the Federal Managers' Financial Integrity Act, the CFO 
Act, and the Prompt Payment Act. 

Case Illustration: GPRA Pilot Projects' Fiscal Year 1994 Performance 

GPRA requires that each federal agency report annually on its 
performance-—specifically, on the degree to which the agency is 
meeting its annual performance goals and on the actions needed to 
achieve those goals that have not been met. Under GPRA, OMB was 
required to select agencies to pilot GPRA performance planning and 
reporting requirements. Forty-four pilot projects submitted reports 
for the first round of performance reporting in 1995. We identified 
some individual features that when viewed as a whole, appear to have 
the potential for enhancing the general usefulness of future 
performance reports in providing decisionmakers and the public with 
the information needed to assess progress.[Footnote 24] These features 
would also be appropriate for GMRA accountability reports. 

Our initial observations suggest that GPRA performance reports are 
likely to be more useful if they: 

* describe the relationship between the agency's annual performance 
and its strategic goals and mission, 

* include cost information, 

* provide baseline and trend data, 

* explain the uses of performance information, 

* incorporate other relevant information, and, 

* present performance information in a user-friendly manner.

By describing how the annual performance information it has reported 
relates to its strategic goals and mission, an agency can help its 
customers and stakeholders understand the relationship between the 
year's accomplishments and the agency's long-range goals and reason 
for existence. By including cost information-—ideally, unit cost per 
output or outcome—-the agency can demonstrate the cost-effectiveness 
and productivity of its program efforts. In addition, by providing 
baseline and trend data-—which show the agency's progress over time—-
the agency can give decisionmakers a more historical perspective 
within which to compare the year's performance with performance in 
past years. Similarly, by explaining the uses of the performance 
information—such as the actions the agency has taken or identified as 
needed, based on the data—the agency can help decisionmakers judge the 
reasonableness of its performance goals and decide upon actions they 
may need to take to improve the agency's performance. The report 
should include any other information that is relevant—such as the 
limitations in the quality of the reported data—that users of the 
report may need to help them better understand the performance data 
and its context. It is important, as well, that the text be 
understandable to the nontechnical reader—that it use clearly defined 
terms and appropriate, user-friendly tables and graphs to convey 
information as readily as possible. 

Practice 8: Use Performance Information to Support Mission: 

As efforts continue to reduce federal spending, policymakers and the 
public alike are reexamining the federal government's spending 
priorities. Federal agencies are feeling the pressure to demonstrate 
that they are putting the taxpayers' money to sound use. They are 
expected to demonstrate improved performance even as they cut costs-—
two simultaneous demands that are driving the trend toward results-
oriented government. 

As they focus on the outcomes they hope to achieve, federal managers 
increasingly are finding that the traditional ways they measured their 
success—-and thus the traditional ways they did business and provided 
services—-are no longer appropriate or practical. For example, the new 
focus on outcomes is prompting some federal agencies to alter the 
approach of their programs, including working more closely with states 
and local governments and businesses. As agencies create information 
systems to provide them with cost and performance data, they discover 
that having the facts gives them a basis for focusing their efforts 
and improving their performance. 

Case Illustration: Coast Guard: 

The mission of the Coast Guard's Office of Marine Safety, Security and 
Environmental Protection is to protect the public, the environment, 
and U.S. economic interests through the prevention and mitigation of 
marine incidents. In the past, the Coast Guard's marine safety program 
concentrated on the physical condition of vessels, through activities 
such as inspections and certifications. The program focused less 
attention on the human factors that contribute to marine safety. But 
as the office became more outcome-oriented and made more extensive use 
of performance information, it began to redirect its safety efforts. 
Coast Guard data indicate that its mission-effectiveness is now 
dramatically improved. 

Traditionally, the Coast Guard based its marine safety efforts on 
inspections and certifications of vessels. It measured its performance 
by counting outputs, such as the number of prior inspections and 
outstanding inspection results. But the data on marine casualties 
indicated that accidents were often caused, not by deficiencies in the 
vessels or other factors, but by human error. For example, towing 
industry data for 1982 through 1991 showed that 18 percent of reported 
casualties were caused by equipment and material failures, 20 percent 
by environmental and other factors, and 62 percent by human factors. 

Putting this information to use, the Coast Guard changed the focus of 
its marine safety program from outputs to outcomes in its first 
business plan, dated January 1994. After all, it came to recognize, 
the mission of the marine safety program was not to do more and better 
inspections of vessels, but to save lives. As a result, the Coast 
Guard shifted its resources and realigned its processes away from 
inspections and toward other efforts to reduce marine casualties. In 
addition, it identified a significant role for the towing industry in 
the marine safety program and looked for opportunities to work with 
its stakeholders in the towing industry to reduce casualties in their 

The Coast Guard and the towing industry worked to build the knowledge 
and skills of entry-level crew members in the industry. The Coast 
Guard and the towing industry jointly developed training and voluntary 
guidelines to reduce the causes of fatalities. This joint effort 
contributed to a significant decline in the reported towing industry 
fatality rate: from 91 per 100,000 industry employees in 1990 to 27 
per 100,000 in 1995. 

The marine safety program apparently not only improved its mission 
effectiveness, but did so with fewer people and at lower cost. Since the
Coast Guard's marine safety program became a GPRA pilot program in 
fiscal year 1994, the number of direct program personnel declined and 
its budget was reduced by 2 percent. According to the Coast Guard, the 
program achieved its results by giving field commanders greater 
authority and by investing in activities and processes that went most 
directly to the goal of reducing risks on the water. 

[End of section] 

Leadership Practices Reinforce GPRA Implementation: 

Figure 5: Leadership Practices Reinforce GPRA Implementation: 

[Refer to PDF for image: illustration] 

Reinforce GPRA Implementation: 
9. Devolve decisionmaking with accountability; 
10. Create incentives; 
11. Build expertise; 
12. Integrate management reforms. 

[End of figure] 

GPRA will not succeed without the strong commitment of the federal 
government's political and senior career leadership. Only they can 
ensure that each agency's strategic planning and performance 
measurement efforts will become the basis for its day-to-day 
operations. Moreover, only they can ensure that results-oriented 
management will endure despite the customarily high rate of turnover 
among political appointees.[Footnote 25] Some of the practices they 
can take to reinforce results-oriented management are to: 

* devolve decisionmaking authority within a framework of mission-
oriented processes in exchange for accountability for results, 

* create incentives to encourage a focus on outcomes, 

* build expertise in the necessary skills, and, 

* integrate management reforms. 

If GPRA is to thrive over the long run, its concepts need to be made a 
part of organizational culture. For that to happen, the top leadership 
in each agency has to initiate results-oriented management, keep the 
agency focused on it, and embed its principles in the organization's 
basic approach to doing business.[Footnote 26] 

Practice 9: Devolve Decisionmaking With Accountability: 

Leading organizations we studied create a set of mission-related 
processes and systems within which to operate, but they then give 
their managers extensive authority to pursue organizational goals 
while using those processes and systems. These organizations invest 
the time and effort to understand their processes and how those 
processes contribute to or hamper mission accomplishment. They then 
seek to ensure their processes provide managers at each organizational 
level with the authority and flexibility they need to contribute to 
the organization's mission. Allowing managers to bring their judgment 
to bear in meeting their responsibilities, rather than having them 
merely comply with overly rigid rules and standards, can help them 
make the most of their talents and lead to more effective and 
efficient operations. 

In our work with foreign countries that have adopted results-oriented 
management, we found that two reforms in particular were aimed at 
enhancing accountability among line managers: simplifying the rules 
for such things as budgeting and human resource management while 
devolving decisionmaking authority.[Footnote 27] These two reforms 
were undertaken in exchange for managers assuming greater 
accountability for the results of their programs. Managers generally 
welcomed their new authority to make spending, personnel, and 
operational decisions that had formerly been made by central 
authorities. But although these countries were generally satisfied 
with the progress they had made, they continued to struggle with a 
number of important issues, such as the acceptable level of risk and 
the extent to which decisionmaking authority should be devolved to a 
given organizational level. 

Case Illustration: Army Corps of Engineers: 

The U.S. Army Corps of Engineers' Civil Works Directorate's Operation 
and Maintenance Program is responsible for the stewardship of dams, 
levees, and other parts of the water resources infrastructure 
constructed by the Corps. Operation and maintenance expenditures had 
become by fiscal year 1990 the single largest individual program item 
in the Corps' budget. In 1991, faced with rising budget pressures, a 
growing project inventory, and the need to become more results-
oriented, the Corps initiated a comprehensive review of its civil 
operation and maintenance program. 

One major finding of the Corps' 1993 plan of improvement was the 
burdensome number of internal levels of review. At the majority of 
project sites, for example, procurement of items costing less than 
$25,000 required between one and five signatures; each approval beyond 
the first one added to the time required for the procurement and 
created inefficiency, revenue loss, and a potential danger to the 
staff and public when safety corrections were delayed. 

To remedy this situation, the Corps changed its processes by 
decentralizing its organizational structure and giving project 
managers new decisionmaking authority to help them achieve the desired 
outcomes. The intent of these changes was to put key operational 
decisions in the hands of the managers who were closest to the point 
of customer service. These managers could now focus on, and be held 
accountable for, achieving goals instead of merely complying with 
rules. Now procurements of up to $25,000 can be approved by a single 

As part of this new approach, the Corps reformed its processes, 
revising its policies and procedures to ensure that only those that 
were necessary remained. It achieved this reduction, by and large, by 
indicating "what" was to be accomplished and leaving the "how" to the 
initiative of project staff. Eighty-nine engineering regulations were 
thereby consolidated into 7, and the number of pages of Corps' 
regulations was reduced from 1,596 to 306. 

This streamlining of its organization and processes allowed the Corps 
to reduce the number of its management levels. By the Corps' estimate, 
the savings created amounted to about $6 million annually and a 
reduction of 175 full-time equivalent staff years. 

Practice 10: Create Incentives: 

Across government, the best incentive Congress and the executive 
branch can apply to foster results-oriented management is to use 
performance measurement data in their policy, program, and resource 
allocation decisions and to provide agencies with the authority and 
flexibility to achieve results. Like Congress and the executive 
branch, an agency's top political and career leadership can encourage 
a greater accountability for results by providing managers at each 
level in the organization with the appropriate authority and 
flexibility to obtain those results. 

Successful organizations we studied defined their missions clearly and 
communicated them to their employees—-particularly to their managers-—
so that each one would understand his or her contribution. At both the 
organizational and managerial levels, accountability requires results-
oriented goals and appropriate performance measures through which to 
gauge progress. Our study of several leading foreign governments, 
however, showed that although there was general agreement on how to 
hold organizations accountable for results, there was as yet no such 
agreement on how best to hold individual managers accountable. 
[Footnote 28] New Zealand and the United Kingdom held their program 
managers accountable for efficiently providing specific goods and 
services. Australia and Canada, on the other hand, hold their program 
managers accountable for evaluating the overall effectiveness of their 

Congress and the executive branch continue to explore formal ways to 
hold individual managers accountable for results. At the agency level, 
however, informal incentives are available to leaders to encourage 
results-oriented management. Through meetings and personal contacts, 
for example, leaders can let managers and staff know of their 
commitment to achieving the agency's goals and to keeping these goals 
in mind as they pursue their day-to-day activities. 

Case Illustration: Department of Veterans Affairs: 

The Department of Veterans Affairs (VA) comprises three agencies that 
provide services and benefits to veterans. The elevation of VA to 
cabinet-level status in 1989 spurred the department to make internal 
management improvements. To recognize and reinforce results-oriented 
management, VA instituted in 1992 a formal recognition program for 
quality achievement. 

The Robert W. Carey Quality Award is VA'S most prestigious award for 
quality achievement. It is named for Robert W. Carey, who, as the 
Director of VA'S Philadelphia Regional Office, was a "Quality Leader" 
and champion of excellence in the federal government. The Carey Award 
helps promote quality management within VA by giving the department a 
prominent means of recognizing high-performing offices, encouraging 
outcome-oriented practices, and educating VA employees about the 
benefits of results-oriented management and customer service. 
According to a VA official, the Carey Award is valuable, in part, 
because VA offices that want it must apply for it and the application 
itself becomes a useful self-assessment tool. 

VA announced its first Carey Award in 1992. There is one overall 
trophy winner annually along with several category winners. There have 
been 20 winners to date. 

Practice 11: Build Expertise: 

To make the most of results-oriented management, staff at all levels 
of the organization must be skilled in strategic planning, performance 
measurement, and the use of performance information in decisionmaking. 
Training has proven to be an important tool for agencies that want to 
change their cultures.[Footnote 29] Australian government employees, 
for example, cited training as one of the factors that contributed the 
most to making reforms succeed in their areas.[Footnote 30] 

Results-oriented managers view training as an investment rather than 
an expense. And as human resource management experts at leading 
private and public organizations have pointed out, organizational 
learning must be continuous in order to meet changing customer needs, 
keep skills up to date, and develop new personal and organizational 
competencies.[Footnote 31] But at a time when overall agency budgets 
are under pressure, training budgets are unlikely to increase. 
Therefore, it is important that agencies develop innovative and less 
costly ways to train their staffs—remembering as well that the level 
of return for investing in the skills needed for results-oriented 
management will depend largely on how well employees are encouraged to 
put those skills to use. 

Recognizing the value of training, especially for the people at the 
top of the organization, the CFO Council's GPRA Implementation 
Committee has begun an outreach effort directed toward senior managers 
in the 24 CFO Act agencies. The council's goals are to familiarize 
these leaders with GPRA'S fundamentals and with the importance of 
these fundamentals for the future of federal management. 

In addition, in response to an initiative of the American Society for 
Public Administration and with the encouragement of 01V113, over 30 
case studies are being developed on the agencies' use of strategic 
planning or performance measurement. These case studies, to be 
completed in the summer of 1996, are to be made publicly available. 

Case Illustration: Department of Defense: 

The Department of Defense (DOD) is responsible for the military forces 
needed to deter war and protect the security of our country. DOD'S 
major service branches-—the Army, Navy, Marine Corps, and Air Force-—
consist of about 1.5 million men and women on active duty, 1 million 
members of the reserve components, and about 900,000 civilian 
employees. As with other federal agencies, performance information is 
becoming an increasingly important part of DOD'S budget process. DOD'S 
leadership has come to recognize that if the Department is to make 
results-oriented management a success, it must train its employees in 
strategic planning, performance measurement, and the use of 
performance information. 

DOD officials recognized when they were considering various methods to 
deliver GPRA training that the costs—in both money and time—of 
providing training through traditional, live classroom instruction 
would be prohibitive. As an alternative, DOD is now testing the 
feasibility of training staff at its GPRA pilot agencies via 
satellite. This interactive approach can reach widely dispersed 
audiences less expensively than traditional methods. The GPRA course 
originates out of a studio and has been broadcast simultaneously to up 
to 20 sites around the country. Since the first class in September 
1995, the GPRA training has been delivered 3 times via satellite to 38 
sites and has reached 760 people. 

In developing its GPRA training, DOD decided to go beyond the 
traditional lecture approach to instruction. GPRA training has 
included exercises and panel discussions designed to make trainees 
think the way they will need to when the training is over and the real 
work of implementing GPRA begins. Participants have been asked, for 
instance, to develop mission statements for their home organizations 
and to develop strategic goals and performance measures. According to 
a DOD official, the classes have been well received. 

DOD is also developing a self-paced GPRA course accessible on the 
Internet and is considering the use of CD-ROM technology. 

Practice 12: Integrate Management Reforms: 

Within a given federal agency, the management reforms now under way 
may spring from various sources. Some of these reforms may be self-
initiated, others may have been mandated by legislation, still others 
may be the result of administration initiatives such as the National 
Performance Review. All of this reform activity needs to be 
integrated, as the CFO Council urged in May 1995: 

Existing planning, budgeting, program evaluation and fiscal 
accountability processes should be integrated with GPRA requirements 
to ensure consistency and reduce duplication of effort. In addition, 
other management improvement efforts, such as implementation of the 
CFO Act, and FMFIA [Federal Managers' Financial Integrity Act], 
customer service initiatives, reengineering, and Total Quality 
Management, etc., should be incorporated into the GPRA framework to 
capitalize on the synergy and availability of key information and to 
improve responsiveness to customers and other stakeholders.[Footnote 

Another management reform initiative that provides a legislative basis 
for measuring performance is the Information Technology Management 
Reform Act of 1996, which requires each federal agency to ensure that 
performance measures are prescribed for information technology that it 
will use or acquire and that the performance measures assess how well 
the information technology supports agency programs. In addition, the 
Federal Acquisition Streamlining Act of 1994 requires the head of each 
executive agency to approve or define the cost, performance, and 
schedule goals for major agency acquisition programs. 

Taken together, these reforms can help redirect an organization's 
culture from the traditional focus on inputs and activities to a new 
focus on defining missions and achieving results.[Footnote 33] Our 
work has shown, however, that the top leadership of each federal 
agency needs to meld these various reforms into a coherent, unified 
effort.[Footnote 34] Top leadership—-both political and career—-needs 
to make clear its commitment to the fundamental principles of results-
oriented management and ensure that managers and staff at all levels 
recognize that they must do the same. Traditionally, the danger to any 
management reform is that it can become a hollow, paper-driven 
exercise. Leaders who integrate results-oriented management into the 
culture and day-to-day activities of their organizations will help 
avoid that danger. 

Case Illustration: Army Research Laboratory: 

The Army Research Laboratory (Aim) was established in October 1992 as 
a result of a realignment of a number of Army research and development 
organizations. It is now the central laboratory of the Army Materiel 
Command. At a time when both staffing levels and funding had been in 
decline since fiscal year 1989, ARL was given a major technological 
challenge—-digitizing the battlefield for the U.S. Army. ARL concluded 
that to ensure that it had the capability to meet the new challenge 
and continue to conduct its mission of basic and applied research, it 
had to work in partnership with universities and the private sector, 
as well as operate more effectively and efficiently. This "Federated 
Laboratory" concept guided ARL as it integrated the various management 

As a GPRA pilot program, ARL developed a strategic plan that included 
a mission statement and long-range goals. In addition, it has produced 
two yearly products: a performance plan with key measures and a report 
detailing its progress in meeting its goals. The annual reports have 
been integrated into ARL'S planning and budgeting processes and are 
discussed by agency leadership at the Director's quarterly meetings. 
In addition, the reports have been tied into DOD'S Planning, 
Programming, Budget, and Execution System. ARL'S performance measures 
gauge the relevance of ARL'S current work to the agency's long-term 
goals and give ARL'S leaders indicators of productivity and quality. 
As part of its performance measurement efforts, ARL established 
customer service standards and sent surveys to its customers to obtain 
feedback on the quality of its work. 

As a National Performance Review "reinvention laboratory," ARL has 
been granted waivers by DOD and the Army from internal regulations in 
order to streamline its processes. For example, one such waiver 
allowed ARL to eliminate redundant reviews of certain procurements, 
thereby saving 5 workdays on each procurement. Saving time on 
administrative processes frees staff to perform the principal mission 
of the laboratory. 

Facing pressures similar to those confronting federal managers to 
reduce costs and improve performance, leading state and foreign 
governments have responded by implementing management reform efforts 
consistent with GPRA. The experiences of these governments—and those 
of the federal GPRA pilots—demonstrate that each federal agency will 
need to chart its own course in response to its specific environment 
as it seeks to implement GPRA and become more results-oriented. 
Nonetheless, the experiences of the leading organizations suggest that 
the steps and practices discussed in this guide can assist agencies in 
successfully implementing GPRA. Federal agencies that apply the 
practices may find that their transition to a results orientation is 
quicker, smoother, and, most important, more successful in providing 
the effective and efficient government the American people deserve. 

[End of section] 

Appendix I: Overview of the Government Performance and Results Act: 

The Government Performance and Results Act (GPRA) is the primary 
legislative framework through which agencies will be required to set 
strategic goals, measure performance, and report on the degree to 
which goals were met. It requires each federal agency to develop, no 
later than by the end of fiscal year 1997, strategic plans that cover 
a period of at least 5 years and include the agency's mission 
statement; identify the agency's long-term strategic goals; and 
describe how the agency intends to achieve those goals through its 
activities and through its human, capital, information, and other 
resources. Under GPRA, agency strategic plans are the starting point 
for agencies to set annual goals for programs and to measure the 
performance of the programs in achieving those goals. 

Also, GPRA requires each agency to submit to the Office of Management 
and Budget (OMB), beginning for fiscal year 1999, an annual 
performance plan. The first annual performance plans are to be 
submitted in the fall of 1997. The annual performance plan is to 
provide the direct linkage between the strategic goals outlined in the 
agency's strategic plan and what managers and employees do day-to-day. 
In essence, this plan is to contain the annual performance goals the 
agency will use to gauge its progress toward accomplishing its 
strategic goals and identify the performance measures the agency will 
use to assess its progress. Also, mu will use individual agencies' 
performance plans to develop an overall federal government performance 
plan that OMB is to submit annually to Congress with the president's 
budget, beginning for fiscal year 1999. 

GPRA requires that each agency submit to the President and to the 
appropriate authorization and appropriations committees of Congress an 
annual report on program performance for the previous fiscal year 
(copies are to be provided to other congressional committees and to 
the public upon request). The first of these reports, on program 
performance for fiscal year 1999, is due by March 31, 2000, and 
subsequent reports are due by March 31 for the years that follow. 
However, for fiscal years 2000 and 2001, agencies' reports are to 
include performance data beginning with fiscal year 1999. For each 
subsequent year, agencies are to include performance data for the year 
covered by the report and 3 prior years. 

In each report, an agency is to review and discuss its performance 
compared with the performance goals it established in its annual 
performance plan. When a goal is not met, the agency's report is to 
explain the reasons the goal was not met; plans and schedules for 
meeting the goal; and, if the goal was impractical or not feasible, 
the reasons for that and the actions recommended. Actions needed to 
accomplish a goal could include legislative, regulatory, or other 
actions or, when the agency found a goal to be impractical or 
infeasible, a discussion of whether the goal ought to be modified. 

In addition to evaluating the progress made toward achieving annual 
goals established in the performance plan for the fiscal year covered 
by the report, an agency's program performance report is to evaluate 
the agency's performance plan for the fiscal year in which the 
performance report was submitted (for example, in their fiscal year 
1999 performance reports, due by March 31, 2000, agencies are required 
to evaluate their performance plans for fiscal year 2000 on the basis 
of their reported performance in fiscal year 1999). This evaluation 
will help to show how an agency's actual performance is influencing 
its plans. Finally, the report is to include the summary findings of 
program evaluations completed during the fiscal year covered by the 

Congress recognized that in some cases not all of the performance data 
will be available in time for the March 31 reporting date. In such 
cases, agencies are to provide whatever data are available, with a 
notation as to their incomplete status. Subsequent annual reports are 
to include the complete data as part of the trend information. 

In crafting GPRA, Congress also recognized that managerial 
accountability for results is linked to managers having sufficient 
flexibility, discretion, and authority to accomplish desired results. 
GPRA authorizes agencies to apply for managerial flexibility waivers 
in their annual performance plans beginning with fiscal year 1999. The 
authority of agencies to request waivers of administrative procedural 
requirements and controls is intended to provide federal managers with 
more flexibility to structure agency systems to better support program 
goals. The nonstatutory requirements that OMB can waive under GPRA 
generally involve the allocation and use of resources, such as 
restrictions on shifting funds among items within a budget account. 
Agencies must report in their annual performance reports on the use 
and effectiveness of any GPRA managerial flexibility waivers that they 

GPRA calls for phased implementation so that selected pilot projects 
in the agencies can develop experience from implementing GPRA 
requirements in fiscal years 1994 through 1996 before implementation 
is required for all agencies. As of June 1996, 68 pilot projects for 
performance planning and performance reporting were under way in 24 
agencies. OMB also is required to select at least five agencies from 
among the initial pilot agencies to pilot managerial accountability 
and flexibility for fiscal years 1995 and 1996; however, as of June 
1996 it had not done so. 

Finally, GPRA requires OMB to select at least five agencies, at least 
three of which have had experience developing performance plans during 
the initial GPRA pilot phase, to test performance budgeting for fiscal 
years 1998 and 1999. Performance budgets to be prepared by pilot 
projects for performance budgeting are intended to provide Congress 
with information on the direct relationship between proposed program 
spending and expected program results and the anticipated effects of 
varying spending levels on results. 

[End of section] 

Appendix II: Objectives, Scope, and Methodology: 

Our objectives were to (1) identify and describe the practices most 
helpful to successfully implementing GPRA and related results-oriented 
management initiatives and (2) provide case illustrations of federal 
organizations that have made progress in implementing each practice. 
This report builds on (1) our 1994 report profiling leading private 
and public sector organizations that have successfully improved 
mission performance and program outcomes through the innovative use of 
information management and technology and (2) our 1995 report on the 
human resource management principles employed by selected public and 
private organizations to build and sustain high levels of 
organizational performance.[Footnote 35] Together, these reports are 
intended to suggest frameworks for Congress and federal agencies to 
use in implementing GPRA and related results-oriented management 

To meet our first objective, we reviewed the experiences of leading 
public sector organizations that were successfully changing their 
management and accountability practices to be more results-oriented. 
As part of that effort, we issued separate reports on the experiences 
of six leading U.S. state and four foreign governments.[Footnote 36] 
We also reviewed the management studies of 23 large federal 
departments and agencies that we did during the last decade as well as 
a broad array of our other management and program work. To supplement 
our work looking at leading organizations, we identified and reviewed 
a large body of literature on management reform, strategic planning, 
and performance measurement. From our work, we identified a number of 
practices common to successful efforts to become more results-
oriented. We obtained input from a wide range of federal executives 
and managers and experts in public sector strategic planning, 
performance measurement, and program and policy evaluation, including 
those from the Departments of Defense, Commerce, Transportation, and 
the Treasury; ()NIB; the Office of Personnel Management; the National
Academy of Public Administration; the Urban Institute; and the 
University of Southern California. On the basis of their comments and 
our continuing reviews of leading organizations, we consolidated and 
refined the list of practices to those presented in this guide. 

To meet our second objective, we identified those federal agencies 
that were instituting results-oriented management from our ongoing 
work on the implementation of GPRA at 24 departments and large 
agencies (covering about 98 percent of the federal government's fiscal 
year 1994 outlays) and OMB'S identification of agencies making early 
progress in implementing selected aspects of GPRA. In this way, we 
targeted our work toward agencies that would provide examples 
illustrating each of the practices. The fact that an organization is 
profiled for a particular practice is not meant to imply the 
organization's success or lack of success in meeting other practices. 
Moreover, underscoring the fact that implementing management changes 
required by GPRA will not come quickly, most of the agencies profiled 
began their results-oriented management before GPRA was enacted. We 
interviewed agency officials in program offices, strategic planning 
and quality management offices, and planning and evaluation offices. 
We also reviewed agency documents, such as strategic plans, 
performance plans, performance reports, program descriptions and 
documentation, and other related documents. 

We did our work on this guide from January 1995 to March 1996 in
Washington, D.C., in accordance with generally accepted government 
auditing standards. The steps and practices presented in this 
executive guide are largely a synthesis of previously published 
information and analysis. 

We provided a draft of this guide to OMB, the CFO Council's GPRA
Implementation Committee, and to the individual agencies profiled in 
the case illustrations for their review and comment. OMB noted that 
the guide and the practices suggested in it will help federal agencies 
as they implement GPRA. OMB also expressed support for the guide's 
focus on agency use of performance information to improve management 
and program performance and to demonstrate that federal agencies are 
using taxpayers' money effectively. OMB concurred with our observation 
that the federal government is at the beginning, rather than the end, 
of the process of turning itself into a more accountable, better 
managed, more effective organization. Finally, OMB noted that the 
development and refinement of performance measures will be an ongoing 

We also provided copies of a draft of this guide for comment to the 
agency representatives on the CFO Council's GPRA Implementation 
Committee and incorporated their individual comments as appropriate. 
Generally, their comments suggested that the steps and practices we 
identified from the leading organizations studied were valid and 
complete, and that the case illustrations were accurate to the best of 
their knowledge. We also asked officials in each of the agencies 
profiled as case illustrations to verify the accuracy of the 
information presented on their respective agencies; however, we did 
not independently verify the accuracy of that information. 

[End of section] 

Appendix III: Major Contributors to This Executive Guide: 

L. Nye Stevens, Director, Federal Management and Workforce Issues,
(202) 512-8676: 

Michael Brostek, Associate Director, (202) 512-9039: 

J. Christopher Mihm, Assistant Director, (202) 512-3236: 

Lisa R. Shames, Project Manager, (202) 512-2649: 

Stephen Altman: 

Thomas M. Beall: 

Barbara H. Bordelon: 

Janet C. Eackloff: 

Carolyn J. Hill: 

Donna M. Leiss: 

Victoria M. O'Dea: 

Dorothy L. Self: 

Katherine M. Wheeler: 

[End of section] 

Related GAO Products: 

Managing for Results: Achieving GPRA'S Objectives Requires Strong
Congressional Role [hyperlink,
96-79], Mar. 6, 1996. 

GPRA Performance Reports [hyperlink,], Feb. 14, 1996. 

Office of Management and Budget: Changes Resulting From the OMB 2000
Reorganization [hyperlink,], Dec. 29, 1995. 

Transforming the Civil Service: Building the Workforce of the Future,
Results of a GAO-Sponsored Symposium [hyperlink,], Dec. 26, 1995. 

Financial Management: Continued Momentum Essential to Achieve CFO
Act Goals [hyperlink,], 
Dec. 14, 1995. 

Block Grants: Issues in Designing Accountability Provisions
[hyperlink,], Sept. 1, 

Managing for Results: Status of the Government Performance and Results
Act [hyperlink,], June 
27, 1995. 

Managing for Results: Critical Actions for Measuring Performance
[hyperlink,], June 
20, 1995. 

Managing for Results: The Department of Justice's Initial Efforts to
Implement GPRA [hyperlink,], June 20, 1995. 

Government Reorganization: Issues and Principles [hyperlink,],
May 17, 1995. 

Managing for Results: Steps for Strengthening Federal Management
[hyperlink,], May 9, 

Managing for Results. Experiences Abroad Suggest Insights for Federal
Management Reforms [hyperlink,], May 2, 1995. 

Government Reform: Goal-Setting and Performance [hyperlink,], Mar. 27, 1995. 

Block Grants: Characteristics, Experience, and Lessons Learned
[hyperlink,], Feb. 9, 1995. 

Program Evaluation: Improving the Flow of Information to the Congress
[hyperlink,], Jan. 30, 1995. 

Managing for Results: State Experiences Provide Insights for Federal
Management Reforms [hyperlink,], Dec. 21, 1994. 

Management Reforms: Examples of Public and Private Innovations to
Improve Service Delivery [hyperlink,], Feb. 11, 1994. 

Performance Budgeting: State Experiences and Implications for the
Federal Government [hyperlink,], Feb. 17, 1993. 

[End of section] 

Ordering Information: 

The first copy of each GAO report and testimony is free.
Additional copies are $2 each. Orders should be sent to the following 
address, accompanied by a check or money order made out to the 
Superintendent of Documents, when necessary. VISA and MasterCard 
credit cards are accepted, also. Orders for 100 or more copies to be 
mailed to a single address are discounted 25 percent. 

Orders by mail: 

U.S. General Accounting Office: 
P.O. Box 6015: 
Gaithersburg, MD 20884-6015: 

or visit: 

Room 1100: 
700 4th St. NW (corner of 4th and G Sts. NW): 
U.S. General Accounting Office: 
Washington, DC: 

Orders may also be placed by calling (202) 512-6000 or by using fax 
number (301) 258-4066, or TDD (301) 413-0006. 

Each day, GAO issues a list of newly available reports and testimony. 
To receive facsimile copies of the daily list or any list from the 
past 30 days, please call (202) 512-6000 using a touchtone phone. A 
recorded menu will provide information on how to obtain these lists.
For information on how to access GAO reports on the INTERNET, send an 
e-mail message with "info" in the body to: 

or visit GAO's World Wide Web Home Page at: 

[End of section] 


[1] Improving Government: Need to Reexamine Organization and 
Performance [hyperlink,], 
Mar. 11, 1993. 

[2] Government Reorganization: Issues and Principles [hyperlink,], May 17, 1995. 

[3] Food Safety: A Unified, Risk-Based Safety System Needed to Enhance 
Food Safety [hyperlink,], 
Nov. 4, 1993. 

[4] For a more detailed description of GPRA's requirements, see 
appendix I. 

[5] See, for example, Transforming the Civil Service: Building the 
Workforce of The Future, Results Of A GAO-Sponsored Symposium 
[hyperlink,], Dec. 26, 1995; 
Managing for Results: Experiences Abroad Suggest Insights for Federal 
Management Reform [hyperlink,], May 2, 1995; Managing For 
Results: State Experiences Provide Insights for Federal Management 
Reforms [hyperlink,], Dec. 
21, 1994; Government Reform: Goal-Setting and Performance [hyperlink,], Mar. 27, 1995; 
Executive Guide: Improving Mission Performance Through Strategic 
Information Management and Technology [hyperlink,], May 1994. Also see our 
reports and testimonies included as footnotes and the Related GAO 
Products section of this guide. 

[6] For a detailed discussion of our objectives, scope, and 
methodology, see appendix II. 

[7] Implementation of the Government Performance and Results Act 
(GPRA), A Report on the Chief Financial Officer's Role and Other 
Issues Critical to the Governmentwide Success of GPRA. Chief
Financial Officers Council, GPRA Implementation Committee, May 1995. 

[8] Managing for Results: Achieving GPRA's Objectives Requires Strong 
Congressional Role [hyperlink,], Mar. 6, 1996. 

[9] [hyperlink,], Dec. 21, 

[10] For a discussion of environmental monitoring as a critical aspect 
of strategic thinking, see Henry Mintzberg, The Fall and Rise of 
Strategic Planning (New York Free Press and Prentice Hall 
International, 1994). 

[11] Government Management Issues [hyperlink,], Dec. 1992. 

[12] Office of Management and Budget: Changes Resulting From the OMB 
2000 Reorganization [hyperlink,], Dec. 29, 1995. 

[13] [hyperlink,], Dec. 26, 

[14] [hyperlink,], May 

[15] Managing for Results: Critical Actions for Measuring Performance 
[hyperlink,], June 
20, 1995. 

[16] [hyperlink,], Dec. 21, 

[17] Vehicle miles of travel is published by the Federal Highway 
Administration, as reported by state highway agencies, and is based on 
formal guidance provided by the Administration. 

[18] [hyperlink,], 
June 20, 1995. 

[19] Chief Financial Officers Council, Streamlining Govemmentwide 
Statutory Reports (Jan. 17, 1995). 

[20] Managing for Results: Status of the Government Performance and 
Results Act [hyperlink,], 
June 27, 1995; and Program Evaluation: Improving the Information Flow 
to the Congress [hyperlink,], Jan. 30, 1995. 

[21] Government Reform: Using Reengineering and Technology to Improve 
Government Performance [hyperlink,], Feb. 2, 1995. 

[22] [hyperlink,], 
June 20, 1995. 

[23] Financial Management: Continued Momentum Essential to Achieve CFO 
Act Goals [hyperlink,], 
Dec. 14, 1995. 

[24] GPRA Performance Reports [hyperlink,], Feb. 14, 1996. 

[25] Political Appointees: Turnover Rates in Executive Schedule 
Positions Requiring Senate Confirmation [hyperlink,], Apr. 21, 1994. 

[26] Organizational Culture: Techniques Companies Use to Perpetuate or 
Change Beliefs and Values [hyperlink,], Feb. 27, 1992. 

[27] [hyperlink,], May 2, 

[28] [hyperlink,], May 2, 

[29] Organizational Culture: Use of Training to Help Change DOD 
Inventory Management Culture [hyperlink,], Aug. 30, 1994. 

[30] [hyperlink,], May 2, 

[31] [hyperlink,], Dec. 26, 

[32] Implementation of the Government Performance and Results Act 
(GPRA), Chief Financial Officers Council, May 1995. 

[33] Improving Government: Actions Needed to Sustain and Enhance 
Management Reforms [hyperlink,], Jan. 27, 1994. 

[34] See, for example, Managing IRS: Important Strides Forward Since 
1988 but More Needs to Be Done [hyperlink,], Apr. 29, 1991; General 
Services Administration: Status of Management Improvement Efforts 
[hyperlink,], Apr. 3, 1991; 
and Management of VA: Implementing Strategic Management Process Would 
Improve Service to Veterans [hyperlink,], Aug. 31, 1990. 

[35] [hyperlink,], May 
1994; and [hyperlink,], Dec. 
26, 1995, respectively. 

[36] [hyperlink,], Dec. 21, 
1994; and [hyperlink,], May 
2, 1995. The methodologies for selecting these leading governments are 
detailed in the respective reports. 

[End of section]