Federal Workforce:

Federal Suggestion Programs Could Be Enhanced

GGD-89-71: Published: Aug 23, 1989. Publicly Released: Aug 31, 1989.

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Pursuant to a congressional request, GAO provided information on private firms' and federal agencies' employee suggestion programs, focusing on the program characteristics that contributed to high employee participation and savings.

GAO found that National Association of Suggestion Systems (NASS) data, input from federal program managers, and a Merit Systems Protection Board study revealed that: (1) successful employee suggestion programs included such key factors as management support, continuous publicity, adequate funding and staffing, monetary awards, and responsiveness to suggesters; (2) federal and private programs varied in the extent to which they had those success factors; (3) slow processing of suggestions and unresponsive replies were the most significant disincentives to employee participation; (4) 11 of the 23 largest federal agencies with suggestion programs had automated suggestion systems; (5) in 1987 and 1988, the Office of Personnel Management (OPM) issued guidance to agencies on using computers to improve their suggestion programs, as well as guidance on program evaluation, planning, and administration; (6) during 1987, the private sector generated about 30 suggestions and realized savings of about $50,000 per 100 eligible employees, while federal programs generated 3.9 suggestions and realized savings of about $11,000 per 100 employees; (7) firms generally granted tangible awards as a fixed percentage of realized savings, at an average of $5,000 per 100 employees in 1987, while federal agencies used a sliding-scale formula to grant awards, at an average of $235 per 100 employees; and (8) federal agencies and firms calculated intangible awards similarly.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: OPM issued FPM Letter 451-11 (Nonmonetary and Monetary Incentive Awards) which adopts the intent of the GAO recommendation. Modification of the GAO-proposed payment formula does not appear to be major, and gives latitude to the agencies.

    Recommendation: To motivate federal employees to participate more actively, the Director, OPM, should adopt a fixed-percentage formula for tangible benefit awards of not less than 10 percent, which as shown by NASS data as the typical industry practice. OPM and other agencies should be aware that the potential benefits of this change may not be realized unless the other key factors in a successful program also are emphasized.

    Agency Affected: Office of Personnel Management


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