In the summer of 2001, the Office of Management and Budget (OMB) announced the President's Management Agenda (PMA), which is aimed at improving Federal government performance. The action, and the highly public scorecards of how agencies are performing on the five key PMA initiatives, builds on more than a decade of enabling legislation and regulatory mandates to create a renewed emphasis on performance - measured in such terms as financial integrity and stewardship, financial performance, cost effectiveness, program effectiveness and service to citizens. Based on our experience in business performance management (BPM) and on our research into the legislative and regulatory context for what we can call government performance management (GPM), it is clear that data/information integration will be an absolutely critical enabler of GPM and the PMA. Accordingly, the business analysis methods and data warehousing design and development methods that have been successfully employed in private industry to deploy business intelligence (BI) and data warehousing (DW) applications are extremely well-suited for GPM and for achieving specific PMA agenda items. That said, there are barriers to applying BI/DW in the Federal environment that must be overcome if we are to truly realize the potential of BI/DW to meet the challenges of the PMA and the mandates of key legislative and regulatory actions. If we can overcome these barriers, BI and DW methods and technologies can be substantial enablers of "Getting to Green."
Core Information Requirements for GPM
The goal of improving government performance is certainly not new. For example, the Joint Financial Management Improvement Program (JFMIP) launched in 1948 continues to be a key driver. What is new is that BI/DW business analysis methods, technologies and development methods have matured and converged to the point that we can acquire, integrate and deploy a rich variety of performance management information and then integrate it into key business processes that make a difference to Federal government productivity, service to citizens and program effectiveness. To leverage BI/DW to get to green, we first need to understand what performance management information we need to integrate. Representative requirements from some of the key legislation and regulations are shown in Figure 1.
Figure 1: Representative Performance Management Information Requirements
Not shown in Figure 1 are a number of highly similar and complementary requirements articulated by the Federal Accounting Standards Advisory Board (FASAB No. 1 and No. 4), the Government Performance and Results Act (GPRA), the Government Management Reform Act, the Federal Financial Management Improvement Act, the JFMIP and other Office of Management and Budget (OMB) Circulars. All these separate but overlapping and complementary requirements create the impetus for Federal government departments and agencies to figure out an integrated approach to having the performance management information they need to satisfy the letter and spirit of these requirements. And while the requirements are the same for all, the specific performance information needed by a given agency will vary according to the particular "businesses" in which it is engaged. Further, the Federal government is different than private industry; thus, we need to use BI/DW design and development methods that are specific to the Federal Government.
Business-Centric Development Methods for GPM
In the August 2004 issue ofDM Review, we discussed the business reasons that underlie the trend toward business-centric BI development methods. Principal among those business reasons is the need to create business value with BI/DW investments. This requires close alignment between business strategy, business processes, business information, analytic tools and structured decision making. These same factors must be aligned for GPM, and the manner in which business-centric BI development methods are applied for GPM are shown in Figure 2.
Figure 2: Performance-Centric BI Development Method
The performance management analytical flow shown in Figure 2 is aimed at identifying the specific performance management information a given Federal department or agency requires in order to effectively plan, manage and improve its performance. Over the last decade, the Federal government has implemented strategic planning and annual performance planning processes that serve to align its missions, strategies and processes - shown as the green boxes in Figure 2. The key performance improvement opportunity, however, lies in being able to identify BI/DW performance management opportunities within core management and service delivery processes - shown as the yellow boxes in Figure 2. What's more, the process of identifying performance management information requirements is one with which the Federal government has struggled. It has been our experience that agencies benefit from a structured approach such as that shown in Figure 2, with two keys being having the right mix of business and BI/DW analysts involved in the opportunity identification process and having the organizational will to do a top-to-bottom and cross-agency analysis in a reasonable time frame. Our experience is that this can be done in six to twelve months if agency top management is committed to and champions the process. Once these BI/DW-driven performance management opportunities are identified, we must also have a way of translating them into the BI/DW requirements that drive design and development. That process is shown in Figure 3.
Figure 3: Requirements to Design
This view of the performance management analytical flow highlights the fact that performance management information requirements, which are business-driven (the yellow box), provide the crucial linkage between strategies, goals and objectives and the BI/DW development methods used to design and develop an appropriate, BI/DW-enabled environment that delivers the specific performance management information needed by a given agency. Conceptually, such an environment might look like that shown in Figure 4.
Figure 4: BI/DW-Enabled Environment
Integrating Performance Management Tools
In the August 2003 issue of Business Intelligence Journal, we discussed key prerequisites for using BI and DW to improve business performance. Central among these is the need to integrate the use of the business information, business analytical tools and structured decision processes that BI enables into the business processes that create value. In the Federal government, creating value includes accomplishing the mission, improving service to citizens, improving program and operational effectiveness and being more cost-effective in the use of Federal funds to accomplish the missions. A decade of experience in the BI/DW industry has shown that to create value, we have to go beyond the traditional project end point - deployment and user training - and proceed through a value creation phase as shown in Figure 5.
Figure 5: Creation of Value
As discussed in the article, most of the traditional BI/DW development activities are aimed at the BI asset creation phase. To improve GPM with BI, we need to engage in BI-driven performance management process engineering or reengineering. This is the BI value capture phase. For example, an agency with field operations that has lacked field office performance management information in the past will not have business processes or structured decision processes engineered to take advantage of newly created GPM information delivered through the BI asset. This goes way beyond user tool training - it is about changing how government managers think about performance, performance management and improving performance.
Five Key Barriers
Business-centric BI development methods, tailored to the Federal government context and applied with skill and resolve, can deliver performance management information that can be used to change Federal performance management approaches, enable use of advanced analytical tools and improve service to citizens and program effectiveness. That said, there are some key barriers to using BI and DW and associated methods to improve Federal performance as follows:
Lack of awareness of how BI/DW can be leveraged to meet government performance management requirements. Our market research indicates that government performance management is evolving and improving, as indicated by the increase in the number of agencies that have gotten to green on one or more of the PMA agenda items. That said, much of the progress has been at the foundational level (e.g., investing in financial management systems that allow agencies to earn clean audits). The lack of Federal success stories for the more advanced aspects of GPM and the PMA indicates that CFOs could benefit from examining how their departments and agencies could benefit by using BI to deliver the kind of integrated information needed for planning, managing, evaluating and improving agency and program performance. Business intelligence and data warehousing technologies and methods are ideally suited to integrating and delivering information for GPM, but their use in this context is not yet widely adopted.
Confusion about which information technologies and products are fit for delivering relevant government performance management information. Progress beyond the foundational level is further complicated by the fact that large consulting firms and leading Federal systems integrators are pushing the enterprise software "solutions" of their software vendor partners, the value proposition for which is about day-to-day transactional efficiency and not necessarily about delivering the kind of customized, integrated information needed for performance management in the more strategic sense intended by the PMA, the CFO Act, OMB Circular No. A-127, FASAB SFFAC No. 1, FASAB SFFAS No. 4, GPRA, GMRA, FFMIA and related regulations. By definition, the kind of performance management information that is required for GPM must be customized to the exact and specific operating/program environments whose performance must be managed. Customization is not what major consulting firms and enterprise software vendors are about. That said, there are appropriate business intelligence and data warehousing technologies that are commercially available that can be integrated to deliver customized, integrated information for GPM. The key is a customized data integration architecture implemented with appropriate tools and technologies.
Meeting the challenge of identifying relevant performance management information in a complex organizational environment. The Federal Enterprise Architecture Business Reference Model shows that the Federal government is involved in 35 lines of business and 137 subfunctions. Many departments are engaged in multiple lines of business and multiple subfunctions. At the same time, these same departments execute multiple programs via many different operations. Within a department, there are often multiple bureaus and/or agencies and/or other components. These various lines of business, subfunctions, programs, operations and components have different missions, strategies, objectives, types of resources, operating characteristics and business perspectives, which means that management of a given Federal enterprise is complex and that the type of performance management information that is relevant varies according to the particular situation. As a result, one size does not fit all, and one must invest in business analysis to determine the full range of customized performance management information required by specific Federal enterprises (departments, agencies, bureaus, etc.). Business-centric BI development methods are very well suited to such analysis and customized data integration.
Lack of linkage between strategic plans, annual performance plans and government performance management information. With GPRA as the impetus, Federal enterprises have become adept at developing strategic plans and annual performance plans that are strategically aligned. Our experience and our market research suggests that there is a gap, however, between: a) these high-level planning documents; b) the key business processes via which the strategies and plans must be realized; and c) the performance management information required for planning, measuring, monitoring and improving those key business processes in order to meet the strategic goals and objectives. This lack of linkage between strategy and operating processes is common in private industry as well and is only partially addressed by balanced scorecards, which create the linkages but do not address the thorny problem of acquiring and organizing the performance management information that feeds the scorecards. Without these top-to-bottom linkages, Federal agencies can manually complete GPRA reports and such, but they cannot be assured of having the performance management information needed to achieve their strategies. Further, this lack of linkages makes it difficult to create the levels of budget-performance integration required to be able to inform Congress and OMB of the operational, service and programmatic impacts of proposed legislative changes and/or budget cuts. Business-centric development methods are very well suited to the task of defining performance management information requirements in relation to agency strategies and plans.
Promoting performance management processes and culture. Over the last decade or so, the Federal government has begun an evolution toward best practices in financial management, service to citizens and performance management. As with private industry, this evolutionary process will take time because it entails significant business process changes and cultural changes. Simply put, large institutions do not change quickly, and the degree of change required for effective GPM touches all aspects of the government enterprise, including people, processes and technology. Further, the Federal government does not have the rigors of competition or the profit motivations that drive performance improvement in the private sector. To overcome these situational realities, leaders in the Federal government must consistently educate their management teams about the benefits and methods of government performance management. As part of that process, appropriate management frameworks and tools, enabled by performance management information, must be developed and deployed. Business intelligence and data warehousing technologies and tools are very well suited to providing performance management information, and the availability of the information can drive cultural change.
Getting to Green
There is a very strong fit between the capabilities of business intelligence and data warehousing technologies and the critical need for integrated performance management information to meet the requirements of the PMA, the CFO Act, OMB Circular No. A-127, FASAB SFFAC No. 1, FASAB SFFAS No. 4, GPRA, GMRA, FFMIA, and related regulations. From a BI/DW perspective, GPM is about strategic alignment, business architecture, business process, analytic applications and data integration.
In essence, the performance management information required by legislative and regulatory mandates represents distinct but overlapping and complementary views of the same thing - government performance. As such, we can design a common, integrated data store that provides a single integrated set of the relevant performance facts of any given department or agency. These same facts can be flexibly mapped to annual performance plan goals and objectives, agency strategic plan initiatives and/or to sometimes transitory initiatives that sweep into the Federal government for a few years and are then forgotten. They can also be mapped to the day-to-day performance management needs of operations and program managers at various levels of the agency.
BI/DW is being used for performance management in Federal agencies today, so there is no reason that agencies that haven't started down this path to performance management progress shouldn't do so. It is inexpensive compared to the $100-million+ enterprise infrastructure and programmatic system investments that are underway in many agencies, and all it really takes to get started is leadership will because suitable business-centric BI development methods are readily available. More broadly, getting to green and GPM is about broad-based organizational changes to the way the Federal managers think about performance, to the tools and processes they use to manage and improve processes, and to the kind of information that is routinely available to them to help them succeed in improving government performance. Accordingly, BI/DW can serve, and probably should serve, as a strategic catalyst for improved government performance. To the degree that it is, government performance will be the better for it.
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