By Steve Kelman
In my last blog post, I discussed preparing a class in my introductory management and leadership course for Kennedy School master’s students on the implications of the GSA conference scandal from last spring for how government is organized and managed – in particular how problems like this, and the way the media report them, places a premium in government management on control. (A student from GSA in an executive education program post-scandal reported needing to get 10 signoffs on travel expenses to come, even after participation in the program had been approved.)
I started the class with two quick polls. First I asked those students who had followed the scandal when it broke last spring what their initial reaction had been, with the three alternatives being:
- This is terrible, and it’s typical for how government agencies behave;
- This is terrible, but it’s not typical for how government agencies behave;
- The media is presenting this as a much bigger problem than it really is.
I then gave them the same three alternatives for their views as of the start of the class, after taking their management course so far this semester and reading the background materials on the scandal (the IG report, television coverage, Martha Johnson’s resignation, some congressional testimony, and some “leaked” conference videos from Huffington Post).
The responses were interesting. Their reactions from last spring were:
- 21 percent terrible and typical;
- 61 percent terrible but not typical;
- 18 percent media exaggerating the problem.
After taking part of the management course and reading the material, their opinions had evolved somewhat, though not dramatically:
- 13 percent terrible and typical;
- 69 percent terrible but not typical;
- 19 percent media exaggeration.
To put it mildly, I make no claim that these views – especially the initial reactions from last spring – are representative of the American people. But, especially given that we see a problem of skepticism about government among our students that parallels, although at a much lower level, currents in society as a whole, it was interesting to me that only 20 percent of our students had thought these events were terrible and typical, which to me is good news.
I had the students talk among themselves about the poll results, putting one student from the media-exaggeration camp into each group, and then had the groups brief the whole class. The points the advocates of media exaggeration made that their fellow students found the most convincing were that this involved a tiny amount of money in the government’s budget, and that members of Congress who can’t agree on a deficit reduction deal should be the last to complain about waste at GSA.
We talked about media coverage. I showed them the Google hits I mentioned in my previous blog – that this scandal had gotten infinitely more media attention than the substantive issue GSA head Martha Johnson was spending her time on. One student stated that this was how the media covered business too. I noted that especially in recent years there has been far more critical and hard-hitting coverage of business, but the media still paid significant attention to reporting about quarterly earnings reports, new products, and the substance of the business, in a way that gets done less for government agencies. A student who had been a journalist argued that the media behaved this way because this was what people wanted to read or see – this was being driven by media consumers more than anything.
Finally I put this scandal into the context of what we had been studying about rules vs. empowering employees in the design of government organizations. This kind of environment – and also, as a student had noted in the previous class, the higher ethical standard to which government is held – produces a situation where control becomes a very large element of managing government organizations, and where rules and procedures are used to increase control even if they lower the ability to shine and do a good job.
How to manage in this environment, I asked the students? A number of students were enamored of a reading I gave them by Robert Simons, writing 15 years ago in the Harvard Business Review about “management control in an age of empowerment.” Rules should set boundaries of the unethical and unacceptable, and tell people they must not go outside those boundaries, Simons argues. But inside the boundaries, give people as much room as possible. That is perhaps the wisest lesson to draw from a sad situation.
Posted on Oct 19, 2012 at 10:10 AM0 comments
A year ago, before the GSA conference scandal broke out, we introduced a new case in our introductory management and leadership course at the Kennedy School, written about the decision by the new GSA administrator, Martha Johnson, to emphasize “zero environmental footprint” as her central strategic goal. The aim of the case was to discuss whether it was a good idea to focus on a goal somewhat outside GSA’s traditional mission, and also to discuss whether Johnson should have used more of a planning process before selecting the goal. In the case, Johnson was quoted as saying: “I didn’t want to spend weeks in a conference center, talking about our mission and our goals and so on.… I was trying to give people relief from forever-and-away planning, sifting, strategizing, talking, meeting, and so on, because GSA is an organization of action, and it really simply needs a couple of big channels to work in, and then everybody will take off.”
Last year – though I actually tried to nudge them in a more questioning direction – the vast majority of the students were really enamored of what Johnson had done.
Then the GSA conference scandal hit, and Johnson resigned as GSA administrator. Originally, I wasn’t sure what to do with the case the Kennedy School had spent a lot of time and money developing, and asked myself (and our case program): “Can we possibly teach this again?”
Finally, I decided to do the following: We would teach the original case as is, noting the scandal in the syllabus and telling the students we would have a subsequent class specifically on the GSA conference scandal. The new class – which I decided to call “Martha Johnson and GSA: The Sequel” – would appear in the part of the course dealing with “organizational design,” and specifically after a discussion of the upsides and downsides of decisions to design an organization using lots of rules to prescribe behavior versus giving frontline employees more autonomy/discretion to choose what decisions make most sense.
I checked out a few things to prepare for the class. One of the phrases that was much-ridiculed in media coverage of the GSA conference was spending money on a “team building” exercise at the conference involving assembling bicycles (the phrase was almost always put in quotation marks, so as to heighten the sense of absurdity and waste). So I decided to do a Google search under the phrase “team building conference” to see how common this kind of activity was in the world of conferences and training. The phrase yielded over one billion Google hits, the vast majority for conferences organized for corporate customers, including one company specializing in Caribbean team building conferences for companies, which featured bathing-suited trainees on a beach.
I also looked more carefully at the videos “exposed” by the Huffington Post as “embarrassing,” some of which were played frequently on TV during the scandal. One involved, as the media reported, a clown, who, according to the Huffington Post, boasted about avoiding work. I would urge people to examine the “embarrassing” video – it is a humorous attempt (which probably could be criticized more for being heavy-handed than anything else) to make fun of an employee who doesn’t pull his weight while others are trying to. A video described by the Huffington Post as showing GSA employees “destroying government property” was actually a humorous parody on Johnson’s “zero environmental footprint” policy calling on GSA to save energy – it featured three GSA employees sleeping in one small hotel room (including in the shower), shaving together in the bathroom so as not to waste water, and so forth – the office property was an unneeded printer that wouldn’t be printing unnecessary copies of documents.
Of course, unless somebody was an expert on Johnson’s save-energy policies – which the GSA employees at the conference presumably were and which my students were since they had earlier done a case on this initiative – the point of this whole video would have been lost. Finally, I suspect most of those listening on TV to the “I Wanna Be Commissioner So Fricking Bad” parody sung by the hapless ukulele-strumming Hawaiian GSA employee were unaware of the then-current pop song “I Wanna Be a Billionnaire So Fricking Bad” that it was playing on.
Finally, I Googled “Zero Environmental Footprint GSA” and “Western Regions Conference GSA.” Many blog readers, particularly those in government, will be unsurprised to learn that the former – which is the substantive policy Johnson had actually been spending her time on, as my students knew from the earlier case – got 16,000 hits and the latter 210,000. The first three listings for hits for the former were GSA press releases, while three of the first four for the latter were the Washington Post, Politico, and Youtube. This is how the media cover government agencies.
In my next blog I’ll report on the conversation in class with my students on the scandal and its implications for government management.
Posted on Oct 17, 2012 at 10:06 AM3 comments
FCW’s Matthew Weigelt “obtained” (i.e. somebody leaked to him) a copy of a draft report from the Government Accountability Office about strategic sourcing, which he wrote about on FCW.com, with a follow-up here.
Strategic sourcing – taking advantage of an organization’s combined buying power to get better prices and service from vendors than would be obtainable by each part of the organization buying on its own – is sort of Procurement 101, certainly in the private sector, where it is a major way that purchasing organizations justify their existence in corporate America. The basic idea is no more complicated than the observation that you pay a lower price per unit when you buy the giant economy size than when you buy single-serving containers. I preached this as far back as when I was the Office of Federal Procurement Policy Administrator 15 years ago.
Looking at progress made on strategic sourcing at the Defense Department, Veterans Affairs, Homeland Security and Energy, the GAO report concludes that the government hasn’t moved fast enough, especially compared with big private companies, which, GAO states, buy 90 percent of what they purchase using strategic sourcing, saving a whopping 10 percent to 20 percent of their total purchasing bill (which, if it could be duplicated in the federal government, would imply up to $100 billion a year of savings, a huge number).
I like the idea of comparing what big companies are doing here to what the government is doing, because procurement is a business function, and if the government isn’t doing it as well as big companies, that’s a problem. At the same time, the GAO conclusion is a little unfair, for two different reasons. First, much of what big companies buy is commodities (such as steel or component parts) that are used in the firm’s production, while a larger percentage of what the government buys is services and unique items such as weapons system. Second, strategic sourcing in the government has been politically controversial, with the very concept denounced by small business lobbyists as “bundling.” My own efforts in the government in support of strategic sourcing earned me the frenzied enmity of these lobbyists, who defended the government paying retail rather than wholesale prices.
I like two of the directions the GAO report takes in its recommendations. First, they argue more use should be made of existing strategic sourcing contracts. I agree. Although use of the General Services Administration’s office supplies strategic sourcing contract has been greater than any of the previous similar contracts – and by the way GSA has been able to include some small business suppliers on this contract – it still accounts for less than half of office supply sales to the government. In these tough budget times, why doesn’t somebody (the Office of Management and Budget perhaps?) just bite the bullet and say use of this contract should be mandatory unless there is a good reason – hopefully filled with a lot of stupid paperwork to discourage applications -- for an exemption. This is exactly what many big companies do. (There is a fair worry about prices on these big contracts deteriorating over time and not responding to spot market changes, as well as a worry about GSA gaining a procurement monopoly that will make them lazy. Partly, the multiple-award nature of these contracts counteracts that, but agencies can also do second-stage reverse auctions for larger buys under the contracts that would help keep prices low and deal with spot-market bargains or temporary discounts.)
The GAO’s other recommendation involves applying strategic sourcing more to services. As the report notes, many agencies push back that these are much harder to standardize than the commodities on strategic sourcing contracts. However, I would love to see GSA re-establish some of the earlier service-specific governmentwide contracts they once had (such as for data centers or IT recovery services) that are easier to standardize. And, as a first step, agencies should look at who their two or three biggest service contractors are, and try to manage the relationship more strategically, including obtaining quantity discounts or other favorable treatment.
Posted on Oct 12, 2012 at 10:06 AM3 comments