Feds must tally real value of the work force

Rick Smith

You can't manage what you can't measure. Federal agencies and Congress understand many of the measurable steps of modernizing IT infrastructures to enable e-government. But one component still eludes measurability and therefore better management, namely the people'or human capital'component.

That may be changing. The good news is that managers now have the math to apply to human capital. The President's Management Agenda is a fresh stimulus for federal managers to get a handle on people. The first item on the agenda is Strategic Management of Human Capital. Now the Office of Management and Budget is stressing performance and measurement.
How do you calculate human capital? Is it an asset?

To measure, you need performance metrics. The federal sector is replete with statutes, Office of Management and Budget circulars, General Accounting Office findings, CIO Council how-to documents and similar guidance. These are the necessary beginnings.

Agencies themselves must start focusing on measuring intangibles and discussing how to align IT efforts with mission goals. Simple cost-cutting must yield to value analysis.

An important interim step toward measuring human input is quantifying the business contributions of the existing and proposed infrastructure. One way is via so-called reverse validation: examine the consequences of not having new Census figures, not having military surveillance, or not having online interfaces with the public.

When you've calculated this value, you'll find it a lot easier to calculate the service levels needed to achieve it and to make your case for both people and funds.

The ability to quantify human performance goals seems to be within the government's grasp. Already, bonuses for Senior Executive Service members are calculated on agreed-to performance objectives.

There are several reasons why government employs too many aging supervisors and not enough new, energetic workers. One reason is because agencies are organized one way, but the skills they need have changed radically.

Even though information is the government's primary product, agencies are organized like factories where human interpretation is minimized and efficiency and process are emphasized.

But e-government requires systems than can customize the information product for each citizen, on request. Metrics and job skills of the sausage-factory approach no longer work, and modernizing systems enable this capability.

Agency managers must view their resources as input for creative processes leading to e-government as the output. They must understand that people are a resource'not as a cost element or an asset, but rather something rented to the agency in return for salary and benefits. Management must quantify the value of people and clarify their roles in organization and staffing. Doing so will enable it to model and then optimize the modernization plan.

By using the true value of your agency's human capital to enhance the architectural blueprints for e-government, agencies can better ensure that great products will flow from the government.

Rick Smith is a management consultant in Reston, Va., specializing in helping agencies develop new business practices.

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