Archive

Office of Personnel Management

Executive Summary

"I'm in the front rank of radical change," James B. King, director of the Office of Personnel Management (OPM), told Government Executive magazine in mid-1993. "Why take it in little exotic chunks? Why don't we start right at the beginning and take it through to see how it can work best?"(1)

King is not shy about OPM's need to change, nor about its failures. A paper he prepared for the National Performance Review (NPR) said of the agency:

Its rebirth in 1979 as the Office of Personnel Management was intended to reshape its identity from rulemaker and enforcer to developer and supporter of management systems to make the federal agencies more effective in serving the public. Nevertheless, though some progress has been made, the process of change is incomplete. OPM still oversees a regulatory system based on central control, and has failed to embrace its new responsibility as a management agency.(2)

King's candor, and his bold approach to change, comes not a minute too soon for his 14-year-old agency, which has long disappointed its critics. Washington has never needed a new, revitalized OPM more than today. The NPR's vision of fundamental, far-reaching changes in all management systems will demand a major cultural change across the government over the next decade. OPM must lead the way in transforming that vision into reality, although many others also will play key roles--agency heads, the agency's human resource management (HRM) professionals, executives, managers, supervisors, employees, unions, and Congress.

Specifically, the NPR's recommendations for reinventing HRM call for maximum deregulation and delegation, trust, accountability for results, decentralization, and entrepreneurial behavior. Managers will be trusted to act fairly and responsibly in managing their employees, and will be held accountable for their actions and for achieving a productive, diverse, multi-skilled, customer-oriented workforce. Employees will be involved in decisions that affect them and will take pride in their contributions. Where employees are represented, labor and management will work cooperatively as partners in carrying out the organization's mission.

In this system, OPM (and agency HRM offices) must assume the primary role of consultant, providing expert advice and assistance, not acting as an obstacle to progress. In providing such leadership for the cultural change, OPM should take two concurrent paths. One is a long-term commitment to a new internal culture that emphasizes a results-oriented approach to HRM and eliminates the control mentality. The other is continuing the commitment to involve all stakeholders in redesigning HRM systems.

Background

Created in January 1979 with passage of the Civil Service Reform Act (CSRA), OPM was supposed "to strengthen the government's human resource infrastructure by implementing the framework outlined in the law, serving as the government's central personnel leader, and advising the President on personnel matters."(3) But CSRA also created serious problems for OPM, both vis-a-vis other personnel organizations and within OPM itself.

CSRA "fragmented the major responsibilities for federal personnel management by creating OPM, the MSPB [Merit Systems Protection Board] and the Federal Labor Relations Authority out of the Civil Service Commission," personnel expert Larry Lane has written. "Even within its own sphere of responsibility, OPM contained a basic contradiction. Its management doctrine was dedicated to control and accountability while its operational methodology was committed to decentralization and delegation. As a management agency, OPM had little that it could directly control. The meaningful action in implementing CSRA was at the agency level."(4)

While agencies moved to implement CSRA, OPM struggled to find its identity. It could not keep up with, let alone provide leadership and consultation to, the agencies. When OPM tried, its efforts were "universally regarded as too late, too inconsistent, and not sufficiently informed."(5)

During its formative years, OPM pursued two other policies that shaped its character and image. First was its "consistent pattern of excluding the federal personnel community from deliberations on policy and program development."(6) Although OPM met its objective in breaking with the past civil service practices that CSRA was reforming, it also cost itself any viable leadership role in the law's implementation.(7)

Second, OPM relied on a political control process in which the main players in policy development were the assistant secretaries' group.(8) This reliance on political appointees only grew in the Reagan years, when former OPM director Don Devine sought to replace OPM's traditional management orientation with an unswerving emphasis on responsiveness of the public service solely to political direction from within the executive branch. Devine sought to have OPM assert ideological leadership and to establish a system of political administration throughout the federal sector. This approach placed OPM in a bitter adversarial relationship with Congress, labor unions, and other representatives of public service interests.(9)

For the decade beginning in 1981, OPM's budget for direct personnel management activities decreased 45 percent in constant dollars, while the number of political appointees almost doubled.(10) "The career workforce at OPM was subject to frequent reorganizations, forced transfers, and assignments of individuals away from areas of their expertise."(11)

These events left an indelible mark on the agency and contributed to its reputation for ineffectiveness as a central management agency. Not surprisingly, Connie Horner confronted a demoralized agency when she succeeded Devine in 1985. In her major accomplishment, she reversed OPM's politicization by requiring participation of career executives in all discussions of policies affecting the federal workforce.

Constance Berry Newman, who served as OPM director from 1989 to 1992, began a serious rebuilding process and was particularly effective in involving the major stake-holders--unions, the personnel community, managers' associations--in strategic planning for federal HRM. Her initiatives, and the emphasis she placed on civil servants' role in delivering critical public services, began to give OPM a more positive image. But today, despite Newman's leadership, King still has a big job ahead of him.

A Reinvented OPM

To assume the position required in a reinvented government, OPM must alter its role, overhaul its structure, and change its internal culture.

Today, OPM conducts activities in three main categories. It develops legislation, policies, and administrative systems and pro-grams that support HRM; acts as evaluator and regulator of agency behavior; and provides governmentwide services, such as background investigations, examinations, training, and benefits administration. Un-fortunately, its varied roles interfere with its efforts to provide advice to the administration's top executives on transforming HRM.

Thus, OPM should take steps to clearly define and publicize its HRM policy, service, and leadership roles, such as by describing them in published documents. At the same time, it should delegate operational work to the agencies and create a reinvented program of oversight and assessment of the agencies.

Along with its role in a reinvented HRM process, OPM's structure needs an overhaul. Currently, the agency is run by a director and deputy director (both confirmed by the Senate), has 6,100 employees in Washington or field offices across the nation, has a $460 million administrative budget, and manages two trust funds with annual expenditures that total over $50 billion. While critics deride OPM's structure as ineffective, NPR recommendations will place even more demands on the agency.

To fulfill those demands, OPM should restructure itself to better address customer needs and to reflect its changed roles and functions. In that process, OPM should consider, among other things, how it can best reinvent its approaches to compliance and evaluation, integrate and refocus its research and development offices, reexamine the role and size of its Office of the Inspector General, improve interagency training functions to reflect and reinforce government- wide policy and culture change, and help agencies build a more diverse workforce.

The CSRA's promise that agencies would enjoy more latitude over personnel matters has gone unmet, with OPM still maintaining central control. But if the need for change is clear, its prospects are less so. OPM's employees may lack the skills to serve as facilitators of government change.

With success, however, an internal cultural change at OPM can serve as a model for the rest of government. It will let OPM's staff play a more effective leadership role in governmentwide and agency cultural change and reinvention initiatives. In providing that leadership, OPM should use various interagency groups to involve more individuals in the change process. And in setting governmentwide policy, OPM should consider using negotiated rulemaking (reg-neg), which brings interests together in efforts to diminish conflict before policy changes are enacted.

Endnotes

1. Shoop, Tom, "Managing Workers of America, Inc.," Government Executive (July 1993), p. 39.

2. U.S. Office of Personnel Management, Human Resources Management for the 21st Century (Washington, D.C., May 1993), p. 4.

3. U.S. General Accounting Office (GAO), Managing Human Resources: Greater Leadership Needed to Address Critical Challenges, GAO/GGD-90- 19 (Washington, D.C.: U.S. General Accounting Office, January 1989), p. 2.

4. Lane, Larry M., "The Office of Personnel Management: Values, Policies, and Consequences," in Patricia W. Ingraham and David H. Rosenbloom, eds., The Promise and Paradox of Civil Service Reform (Pittsburgh: University of Pittsburgh Press, 1992), pp. 106-7.

5. Lane, p. 107.

6. Ibid., pp. 107-8.

7. Ibid., p. 108.

8. Ibid., p. 107.

9. Ibid., p. 109.

10. GAO, p. 6, and Lane, p. 110.

11. Lane, p. 110.

Return To Report Index