In this new era of responsibility and accountability, the passage of economic stimulus fundingalong with demands for successful government performancepresents contemporary challenges for public managers. The challenges demand that public managers rely on collective efforts, share collective responsibility and accountability, increase cooperation and collaboration, ensure compliance, broaden communication, and encourage continuity. To meet these challenges, managers should use tools such as increased collaboration and coordination, processing of data and payments electronically, multivariate analysis to assist in planning and making choices, and balanced scorecards to account for outcomes.

Stimulus Funding

The American Recovery and Reinvestment Act (ARRA) of 2009 is an economic stimulus package enacted by Congress in February. ARRA is intended to provide a stimulus to the U.S. economy in the wake of the economic downturn and is worth $787 billion. Basically, the stimulus includes federal tax cuts; expansion of unemployment benefits and other social welfare provisions; and domestic spending in education, healthcare, and infrastructure, including the energy sector.

Cooperation between agencies is key. However, this is not a natural process, because federal agencies must implement policy and manage budgets through discrete agency chains of command, not across the government. Federal agencies must learn how to cooperate more closelya process that officials say is more difficult than it sounds.

Performance Management

Recently, Vince Gooden participated in the grant review paneling process to examine and rate proposals for one of the social welfare programs funded by the stimulus package. Ratings were based on how the applicantslocal-level public, nonprofit, and private organizationsresponded to published performance requirements, such as who is to be served, how they are to be served, who serves them, and how success and outcomes are measured.

Many successful proposals adequately described the need for services, cost effectiveness, and the extent to which they addressed performance requirements and emphasized coordination and collaboration with related services. Conversely, a number of proposals were poorly written, failed to address the proposal requirements, were not cost-

effective, and showed no evidence of cooperative efforts with other service providers.

Collaboration and Coordination

The need for increased collaboration and coordination at the local level is nothing new. When surges in federal funding are made available to communities, such as in the Great Society, the need for collaborative efforts is more apparent. The Great Society was a set of domestic programs enacted in the late 1960s at the initiative of President Lyndon B. Johnson, including social reforms for eliminating poverty and racial injustice. Major ground-breaking spending programs that addressed education, medical care, urban problems, and transportation were launched during this period.

Local Human Resource Councils

In 1971, Gooden sent a letter to Elliot Richardson, the secretary of the U.S. Department of Health, Education, and Welfare (HEW), about the need for local human resource councils that would include the U.S. Office of Economic Opportunity (OEO), the National Institute of Mental Health (NIMH), Model Cities, county welfare agencies, and the United Way. This model group would serve as the pilot for other agencies to follow as needed or as desired. The purpose of the council was to

  • plan services to the community
  • coordinate services provided
  • eliminate duplication of services
  • provide each other assistance when applying for funds
  • provide joint information about future planning.

At that time, it was suggested that the ultimate objective of the council would be greater local agency autonomy over services and more services provided as unmet needs declined. For instance, OEO would provide manpower and economic development; NIMH would provide social and psychological services; and Model Cities would provide housing and rehabilitation.

Summit County, Ohio, Mental Health Board

In 1976, when states were deinstitutionalizing large mental hospitals, the Summit County Mental Health Board coordinated a group composed of representatives from mental health centers, institutions, community agencies, and board staff. The group was called the Transitional Services Committee (TSC), with the expressed philosophy that transitional services are important to the health and quality of life in Summit County. TSC felt that the harmful effect of institutionalization was evident for citizens with frequent psychiatric hospitalizationsnot just the long-term patient. Also, the high psychiatric readmission rate in this county pointed to a need for an improved community support system. The goals of TSC were clear:

  • Achieve a coordinated effort between institutions and community agencies that would result in continuity of care.
  • Develop a community support system that would minimize the need for psychiatric hospitalization and promote individual growth.
  • Improve discharge planning between the hospital and community.
  • Develop a consultation and education service.

TSC members met monthly to determine needs, develop a standards manual for group home operators, complete a transportation study, and participate in the implementation of several aftercare projects, including the Leasing Assistance Program, which provided financial assistance to persons who had been mentally ill but had been prepared for independent living following their treatment.

Kansas Citys Urban Collaboration

More recently, a Washington Post article discussed how President Obama is setting his sights on new ways to address urban renewal. According the article, the presidents plan emphasizes revitalizing U.S. cities with a coordinated effort that involves stimulus funding and getting multiple agencies to work together to improve schools, housing, and neighborhoods.

Until recently, federal policy had typically encouraged sprawl, congestion, and pollution, rather than quality public transportation and smart, sustainable development in urban areas. Hence, this is a new way of looking at the city-metro reality, as well as having agencies as diverse as housing, transportation, and environmental protection working together in the process.

The model for this sort of urban cooperative effort is a $200 million project in Kansas City to transform a large depressed area with high poverty, numerous vacant houses, crime, and unemployment. The key is the coordination and cooperation demanded by several entitiesthe U.S. Department of Housing and Urban Development (HUD), the U.S. Department of Transportation (DOT), the Environmental Protection Agency (EPA), and local energy providers. This approach involves viewing urban challenges in a much more comprehensive, holistic way than has existed for decades, according to a nonprofit that promotes regional cooperation in the Kansas City area.

Electronic Payment and Data Processing

As a result of the Personal Responsibility and Work Opportunity Reconciliation Act (PRWORA) of 1996, all states are required to implement electronic benefits transfer (EBT) programs to automate the distribution of benefits for the Food Stamp program. This requirement was designed to streamline the distribution of benefits, giving program recipients wide access to benefits and decreasing inefficiencies and cost-intensive printing and distribution functions.

EBT reduces issues of fraud and administrative costs on the government side while eliminating the individual stigma associated with the receipt of benefit checks and food stamps. Although electronic processing is mandated for EBT, it is not required for many other federal programs, such as child support, child care, or unemployment insurance. However, the current administration has been advocating it for healthcare reform.


Electronic data interchange (EDI) is the electronic transfer of information, such as electronic media claims, in a standard format between trading partners. As it relates to healthcare, this new technology will enable entities within the healthcare systemconnected by an integrated system of electronic communication networksto exchange medical, billing, and other information and process transactions in a manner that is fast and cost effective (Go to for more information). Most of these improvements are likely to result from the significant reduction or elimination of paper transactions.

Cleveland Clinic

The Cleveland Clinic in Ohio offers a best practice example of how to operate a cost-effective and efficient hospital, and much of its success has been attributed to the conversion to a paperless organization using automated medical record management and real-time access to data. In sum, seamless electronic medical records for patients and doctors are critical to lowering overall healthcare costs, and the federal administration included money toward electronic medical records in the stimulus package.

There are several challenges in electronic processing, including the fact that all federal programs do not require payment processing. As a result, states and local governments frequently treat it as an optional tool. Many state and local business rules are so numerous that it makes electronic processing complicated and costly. In addition, some contractors do not have the subject matter expertise or performance capacityas evidenced by recent school openings failing to have automated schedules on time.

Oklahomas Use of EBT

The Improper Payments Information Act of 2002 (IPIA), P.L. 107-300, was enacted to eliminate (or at least reduce) fraud, waste, and abuse in federal agencies, and includes reporting requirements such as corrective action. The Administration for Children and Families report on IPIA recommends EBT as a possible system solution in its Child Care Administrators Improper Payments Information Technology Guide. Figure 1 outlines how Oklahoma uses electronic payment processing for its childcare program, including challenges, benefits, and how to address improper payments.

In essence, agencies should use more electronic processing methods of payment and data management as tools for cost savings and improved services for recipients and customers.

Multivariate Analysis

In program planning and decision making, managers are often faced with various amounts of data and alternative choices. The ability to obtain a clear picture of what is going on and make intelligent decisions is a challenge. However, there are tools available to analyze data from more than one variable.

Multivariate analysis (MVA) is based on the statistical principle of multivariate statistics, which involves observation and analysis of more than one statistical variable at a time. The manager can then analyze the alternatives or responses and make a selection to fill the constituent or recipient needs or desires. Other tools for analyzing multiple variables include factor analysis, cluster analysis, matrixes, and decision trees. The object of all of these is to make sense of data for effective decision making.

For instance, findings and implications from our education, experience, and research reveal a number of effective practices that successful managers use in the contracting process, as well as implications for building relationships, equitable distribution of goods and services, and management governance. Until now, these implications have not been prioritized; however, for the purpose of making sense about how public management should address the stimulus and performance requirements, evidence indicates that practices do vary in their levels of importance in the contracting and management processes.

For example, The Public Manager article Getting Strategic Results Through Performance-Based Acquisition included a matrix that listed vertically effective practices and displayed various contracting and management processes horizontally. The level of importance was as follows:

  • planning and needs assessment
  • inclusion and alternatives, as well as technical assistance
  • monitoring and utilization, standard rating tools, technology
  • debriefing and costing.

Balanced Measurement

The balanced scorecard (BSC) integrates a set of measurements that link financial, customer, internal business process, and learning and growth perspectives to long-term financial success. This is important because by doing these things an organization enhances performance, inspires action and enthusiasm, and fosters an environment of clear accountability.

An integral aspect of the BCS is performance measurement, which begins with defining performance objectives. Performance objectives should be concise and discuss specific things required to implement the strategy successfully. Each objective has measures, and measures have targets. These measures can be defined as either lagging or leading. Lagging indicators measure results or outcomes; leading indicators drive the strategy and results. Objectives fall into four general categories:

  • Financial objectives and measures result from development of new business opportunities and growth of the organization. Profitable growth leads to increased sales volumes, revenue, profit margins, and shareholder value.
  • Customer value proposition measures focus on a leaders ability to build, expand, and deepen trusted relationships through innovation of products and services and by consistently delivering on commitments.
  • Internal business process measures are concerned with processes that create and deliver customer value. Generally, these measures focus on productivity and efficiency. They include operational management measures, customer management measures, innovation measures, and regulatory and social measures.
  • Learning and growth objective measures focus on developing an employee-friendly culture that begins with a human dimensiondeveloping leaders. The strategic objective is to leverage full-spectrum leadership to fully develop program and business leaders.

Performance measurement (see Figure 3) begins with understanding the specific objective and how each objective will be measured, as well as target metrics associated with successful achievement of each performance objective. The selected metric should be measurable and contribute to the organizations success. There should also be a clear methodology for obtaining and calculating actual performance values for each of the metrics.

BSC is a management tool that provides a means to link the business strategy with performance objectives and measurable targets to drive strategy execution and financial results. With the downturn in the economy and evolving government budgets, the probability for successful strategy execution is greatly increased by using the BSC approach. From a public-private partnership perspective, a major government contractor uses a BSC that helps meet the demands for accountability, oversight, transparency, compliance, and ethical operations.

Also, as the governments emphasis on modernizing acquisition moves forwardinclusive of performance-based contractingemphasis on performance measurement and metrics should be an integral step in getting to desired results. The private sector should be cognizant of the governments change to a program focus in contracting, along with technical and contractual focus, and they should incorporate this focus into their thinking about program objectives and measuring outcomes. Hence, BSC enables an organization to be in sync with government funding sources, thus affording both parties to be in a win-win situation.

Closing Analysis

We are entering a new era of accountability. The challenges we face as a nation and as public sector managers are greater and more complex in content and character than at any time in history. The government is attempting to stimulate an economic recovery by making substantial funding available to state and local entities for infrastructure, social welfare projects, housing, education, and transportation. In many instances, proposals are submitted to secure funding. There are performance requirements, and innovative projects are favored.

Public management in contemporary society is challenging, and managers face complex issues that demand collaboration with other agencies, shared funding options, novel and innovative approaches, and measurable performance outcomes. Managers should use tools available to them to ensure clearly stated needs based on current geographic and demographic data, define measurable objectives, think and act strategically in approaching a situation, organize and staff appropriately, and make cost-effective and efficient decisions.