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We in this room know that the federal workplace has problems:

• It is often an environment where employees are isolated from one another because of the way work is assigned and the way work is evaluated.

• It contains employees who are regularly and unfairly derided by the press and attacked by many politicians.

• It often unsafe, because of health and environmental problems.

• It is a place where federal employees can be blown out of their chairs as they were two years ago in Oklahoma City.

We must create a better workplace. We must create a workplace where federal employees work together and want to work together on a clearly defined agency mission; a workplace where federal employees understand their role and are sufficiently empowered that they can perform their role; a workplace where federal employees are excited about their job and want to give their discretionary energy.

By discretionary energy, I mean that energy which cannot be extracted from an employee by a supervisor. Discretionary energy is that energy an employee wants to give because of the challenge and excitement: the workplace. It is the kind of workplace where employees willingly work harder because they are respected, challenged, and empowered.

That workplace can be created only in the context of a successful labor-management partnership. And that kind of workplace is critically necessary to agency success over the next few years.

No agency will be successful over the next few years unless it has a successful labor-management partnership.

I define a successful agency:

1. Meets or exceeds customer satisfaction

2. Meets or exceeds the GPRA goals by constantly searching to discover new work processes and procedures to deliver more quality work at lower cost; and

3. Produces an auditable financial statement. A successful agency will enjoy credibility with OMB, GAO, Congress and the public.

It will have a base of political support and funding support. An agency cannot achieve this success without a successful partnership:

1. Goals cannot be met unless the command and control hierarchial management structure is dismantled and an empowered work force is energized and takes action.

2. Goals cannot be reached unless there are fewer arbitrations, ULPs, time spent in impact and implementation bargaining, and time spent in term bargaining. There must be cost avoidance.

3. There must also be cost saving. And these goals cannot be reached without employee involvement in planning, program development and implementation, budget development and execution; and work process design and redesign.

4. Goals cannot be reached in a workplace at war with itself; a workplace that does not understand where it is headed or why; or a workplace that is not a workplace community.

Agency goals cannot be reached without successful labor-management partnerships. There is no mystery to this. And now we have data to prove our point.

We recently did a 165 question census survey in the IRS. The question that most closely correlated with high job satisfaction was effective use of knowledge, skills, and abilities. If an employee agreed or strongly agreed with the proposition that her or his knowledge, skills and abilities were being effectively utilized, she or he rated job satisfaction as high. The correlation between the two questions was by a 2-to-1 margin. No other question had that kind of correlation.

This information does not surprise us. We have known anecdotally that an employee challenged to use their skills is an employee satisfied on the job. But now we have the data to prove it.

And we have the data to prove that those who rate job satisfaction as high are high performers and work in higher performing groups.

It is only in the context of a successful partnership that a workplace is created where an employee's knowledge, skill and ability can be effectively utilized. While there may be a few employees in every agency who are satisfied with their job and their work, a successful partnership creates a system where every employee has a chance for job satisfaction.

Even though we recognize that partnerships are good and must be created, creating partnerships is hard work.

In many agencies the easy stuff has been accomplished: plans have been made, labor-management problems are on the decline, cost avoidance is on the rise.

And just as things are going well, several things might be occurring:

1. Resistance by first and second level managers who are now, for the first time, being called on to change surfaces.

2. Resistance by union leaders who will be participating in hard decisions versus cost avoidance issues surface. Union leaders begin to understand the stakes.

3. Resistance by union leaders who must now include more people and do not have the union structure in place to effectively communicate with members.

4. Resistance by very high level program managers who now are for the first time confronted with union leaders in their midst - they thought this was all labor-management stuff to be handled by the specialist.

5. Resistance by union members who do not trust managers and management.

We in the federal sector have a tendency to be insular. We tend to think we are unique and our problems are unique. Many of us think that the link between successful partnerships in the private sector and high performing profitable corporations is not applicable to the federal sector. And that often translates into a justification for maintaining the status quo.

Rather than unique problems, I think we are in a unique time -- a time when agencies will be scrambling for a share of an ever declining budgetary pie.

Those agencies with an energetic, enthusiastic work force who produce quality work valued by the public at a decreased cost will survive and be supported. An energetic, enthusiastic work force can only occur in the context of a successful partnership. These are the agencies who will be successful. These are the agencies who will become models for the future.