Federal Performance Management:

Agencies Need Greater Flexibility in Designing Their Systems

GGD-93-57: Published: Feb 24, 1993. Publicly Released: Apr 7, 1993.

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Pursuant to a congressional request, GAO reviewed federal agencies' performance management systems (PMS), focusing on: (1) elements of an effective PMS; (2) whether federal agencies included these elements in PMS; and (3) federal personnel and researchers' views on the adequacy of PMS.

GAO found that: (1) there were 14 key elements of an effective PMS; (2) legislation and regulations required federal agencies to include key elements in PMS; (3) many personnel directors, supervisors, and employees did not believe that PMS improved organizational effectiveness, accountability, employee motivation, or performance; (4) in general, agencies set employee performance requirements and linked performance plans to their missions and goals; (5) PMS improved communication between supervisors and employees; (6) PMS were successful in setting employee performance requirements, but had mixed results in achieving accountability; (7) most personnel directors, supervisors, and employees believed that employees received inflated performance ratings because agencies used performance appraisals for multiple purposes, such as promotions, pay increases, and retention decisions; (8) while some supervisors and personnel directors believed there should be fewer than 5 rating levels, most employees favored retaining 5 performance levels; (9) individual appraisals using established performance standards did not take work teams into account; (10) the capping of performance awards decreased employee motivation toward greater performance; (11) agency officials believed that greater flexibility and decentralization in designing PMS would help ensure that PMS were compatible with the total quality management approach being adopted by many agencies; and (12) the Office of Personnel Management is considering recommendations from two advisory committees on changes in PMS legislation and regulations.

Matter for Congressional Consideration

  1. Status: Closed - Implemented

    Comments: OPM has issued final rules providing agencies with greater flexibility.

    Matter: When Congress considers legislation concerning the Performance Management and Recognition System (PMRS), extending pay for performance to General Schedule employees, and other performance management legislation, it should consider giving agencies the flexibility to better enable them to carry out their missions and manage their human resources. Areas in which greater flexibility might be appropriate are: (1) the requirement to link several management decisions, such as promotions and rewards, directly to the appraisal; (2) the number of summary rating levels that agencies are required to use; and (3) the 1.5-percent ceiling on the PMRS pay pool.


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