5 Essential management practices
Effective management involves selecting the right people for the right job; organizing them to expedite task accomplishment; identifying, budgeting, and spending funds consistent with the jurisdiction’s capacities and priorities; and ensuring that the information infrastructure is adequate. This chapter addresses these separate but related aspects of management.
The chapter begins with a brief note on organization design and then looks at human resource (HR) management, financial management and budget development, and management of the information infrastructure.
Coordinating the work of departments, pursuing the priorities of governing bodies, recruiting and retaining skilled workers, managing fiscal resources, communicating with citizens, building partnerships with the business and nonprofit communities—local government managers do it all, over and over again. The work of the manager reaches deep into the hidden structure that keeps communities vibrant. Like a juggler with balls perpetually in the air, managers have three sets of resources for which they are continuously responsible: people, finances, and information. How they allocate each determines their capacity to accomplish goals, to be responsive to changing circumstances, and to ensure that each resource is mined to its fullest extent.
The purpose of any organization, whether it is a public works department or an airport authority, is to bring people together so that they can accomplish a mission that cannot otherwise be attained. This requires organizing into work units so that efforts are coordinated and contribute to the success of the organization. Designing these parts so that they fit together offers the opportunity to think about what needs to be achieved and how that can best be accomplished. Managers have four sets of design elements at their disposal, and their configuration determines how well a department functions:
When a new manager is hired, the temptation to reorganize surfaces. Sometimes reorganization is effective; sometimes it is not. But it is always disruptive, and it always carries a cost. In the short term, productivity plummets as employee energy turns to worries about how change will affect them. Relocating offices and modifying reporting channels changes the networks that employees have developed for getting their work done. Those who risk losing power, influence, or status will resist the change and endanger the likelihood that the reorganization will achieve its desired effect. Before undertaking a major reorganization, one must conduct a thorough analysis, seeking answers to the following questions:
If answers to these questions lead to a decision that the benefits of redesign outweigh the costs, the local government manager can develop a consensus for change among those who will be affected by it and then proceed.
The human resource management function
First we turn to the hands and feet of government, the people who deliver services. If governance is anything at all, it is about people safeguarding and enabling the lives of others. This function involves service work, which means that public organizations operate less like well-oiled assembly lines and more like what they are—human beings in a group, with all the human foibles and frailties—who are doing the best they can to deliver services to citizens who understand their own needs far better than they understand the pushes and pulls that squeeze the jurisdiction’s budget and capacity.
In a nutshell, the manager’s challenge is to cause a group of strangers to join together to achieve goals that no one can achieve alone. The level of success affects the work climate, employee retention, communication patterns, morale, interdepartmental relations, and, ultimately, mission achievement. Those who lead, manage, and deliver public services are the human resources that make the jurisdiction work. As extensions of the manager, workers control the effectiveness of every decision made. A motivated, committed workforce achieves far beyond the sum of its parts. Conversely, a demoralized workforce unclear about goals will shut down the best-financed, most technologically advanced operation. Johanna Allyn, a manager for the Department of Social Services in Hanover County, Virginia, observed: “Everything we touch involves human beings. How you say what you say has never been more important.”1
Nothing else matters if the right people are not in the right place at the right time to get the job done. It is people who breathe life into budget priorities, who maintain Web sites, put out fires, catch thieves, provide safety net social services, make traffic lights work, enforce zoning ordinances, fill potholes, collect taxes, and otherwise perform all those functions that communities demand. It is up to the manager to create a productive workplace that can deliver these services.2
The public workplace
Public administration is not business administration. Although the work of local government managers is to conduct the business of government, business and government differ significantly. One difference is in the nature of the workforce and notion of civil service. Because public work requires commitment to the public interest and to constitutional values, public workers are held to a higher standard than business employees, in both their personal conduct and the degree to which their job performance is open to public scrutiny. Moreover, public workers are expected to be representative of the citizens served, which means they should look like and be like the citizens of the community—an expectation that introduces an important variable during hiring and promotion: representativeness. The demographic characteristics of the jurisdiction’s workforce should resemble the composition of the community. A city with a population that is 50 percent African American, for example, should have a city workforce throughout all ranks that is roughly 50 percent African American. A workforce that is 75 percent African American in the lower ranks but 75 percent white in the upper ranks fails to meet this standard.
I spent my first six years in Decatur as personnel director and feel very good about the diverse management team that we have been able to assemble. … And I don’t mean diversity just in terms of race and gender.… He [the sanitation director] is an African American … who has a B.A. in mathematics and an M.A. in divinity. How many sanitation directors are ordained ministers?
Peggy Merriss
Why is representativeness necessary? Because employees bring to the workplace the perceptions and values of their associates. In a democracy that prides itself on equality, discussion and debate bring to light the varying perspectives of all groups of citizens. When all constituencies are represented in the workforce, the values of all citizens are present in decision making. Citizens’ level of trust in government is higher, and, conversely, public officials’ trust in citizens is higher as well. Representativeness in the workplace does not replace the need for town meetings and other open forums, however; instead it increases the likelihood that diverse views that emerge from meetings will be added to the decision calculus.
The term “strategic human resource management” refers to the new way of thinking about hiring, training, developing, and retaining valued employees. The HR function is no longer marginalized as a dotted-line staff function only peripherally related to strategic planning and performance; instead, a strategic approach realizes that HR is the lifeblood of the enterprise. Without the right people, even bountiful budgets miss their targets and sophisticated information technology goes to waste. With a strategic approach, the HR director works hand-in-glove with other directors to develop goals, strategies, workforce plans, and resource allocation. This approach expands the HR director’s job and moves the focus beyond the traditional concerns of recruitment and retention, classification and compensation, performance appraisal, training and development, and labor relations to embrace capacity building, succession planning, and organization design.
Civil service principles Civil service merit principles were established in 1883 when the Pendleton Act was passed by Congress to govern employment in the federal government. Over time, states and local governments also adopted these principles in an effort to separate public employment from patronage, prejudice, and favoritism. Although some confusion exists about the term “civil service” in local government because it often refers specifically to public safety personnel, the reference here is to the merit principles embodied in civil service. The manager must handle all matters of personnel on the basis of merit so that fairness and impartiality govern decisions of appointments, pay adjustments, promotions, and discipline. (See Appendix A, item 11.)
For all workers, it should be the employee’s choice, not the employer’s stereotypes, that determines the acceptance or rejection of employment and advancement opportunity. As enumerated in Title 5 of the U.S. Code at Section 2301, merit principles highlight the importance of representativeness, skills-based hiring, and fair treatment irrespective of gender, race, ethnicity, or any other type of “otherness.”
Merit principles in civil service provide for equal opportunity in hiring and promotion, protection from capricious removal, and standardization of pay scales. They insulate workers from partisan political cycles by guaranteeing job security once a probationary period has passed; they categorize jobs so that equivalent levels of knowledge, skills, and abilities (KSAs) are compensated equally; they require job advertisements that give potential applicants an equal opportunity to apply; and they prescribe selection procedures that are based on an assessment of KSAs rather than on subjective criteria. The downside to this emphasis on fairness and equal opportunity is that it involves processes that require time—time to advertise, screen, rate, and select applicants.
Likewise, a manager has more control over employee output and loyalty if the jurisdiction uses at-will employment, which means that employees can be dismissed for any reason without notice or appeal rights. In most cities and counties, a set of job titles are reserved for just such a purpose. Personal staff assistants to elected officials are usually at-will positions to ensure loyalty to the person, not the post. Conversely, adherence to merit principles insulates workers from the necessity for personal loyalty and, instead, legitimates loyalty to the public good. Why is this necessary? Because elected officials come and go, but the day-to-day work of the jurisdiction must go on no matter who is in power.
The fact that election cycles recur on a regular basis differentiates public administration from business administration. Successful business enterprises almost never switch leadership every few years, especially to incoming executives who have little prior experience. Government has made cyclical turnover succeed by staffing itself with a cadre of workers who know the enterprise. Civil service protections represent a trade-off between fairness and speed. Although procedural delays frustrate both supervisors and workers, job protections have made government employment attractive for those who are motivated to serve the public yet desire insulation from the whipsaw of election returns. Jobs that would otherwise be held hostage to partisan or personal loyalty are relatively free from such coercion.
As with any business, no set of principles can replace effective supervision. In traditional civil service systems, employees are hired for a probationary period, during which the supervisor must orient, train, and appraise the worker’s capacity to perform. Much of the criticism about civil service protection is wrongly placed on the system when, in fact, fault usually lies with the supervisor who fails to take responsibility for the unpleasant task of dismissing workers who do not or cannot perform. The probationary period provides freedom to dismiss the worker. Awarding permanent status to an incompetent worker is a supervision problem, not a civil service problem. Once employees achieve permanent status, they have property rights in the job, which means that any action to deprive them of this property invokes their right to due process. Grievance hearings consume time and energy, and unless the supervisor has a well-documented case, the employee is likely to prevail and be reinstated, embittered, and demoralized.
Another aspect of civil service’s reliance on rules and fairness comes to the fore when a reduction-in-force is necessary. To give priority to those with more seniority and experience, the manager’s discretion over positions to cut is limited to jobs, not people. The rules in jurisdictions give employees bumping rights. Permanent employees in jobs to be cut may bump a worker with less seniority in the same job category, or they may move down a rank and bump someone in a lower job class. The result is that a layoff initiated to cut personnel costs targets upper-level staff, but by the time bumping has cascaded through the unit, it may be the most junior assistant who loses the job. Such a system wreaks havoc among workers, each of whom is wary of being bumped by colleagues. The result is the expenditure of an inordinate amount of energy, a loss of productivity, and little financial gain.
Civil service reforms All solutions produce their own problems; this is also the case with civil service reforms that, in the attempt to improve performance and efficiency, usually focus on:
Reforms can take a number of shapes, including removal of job protection, bumping, or appeal rights; broadening job classifications; and revising the way that lists of eligible job candidates are developed. Changing one aspect inevitably affects others, however. Managers’ goals of more discretion over selection, hiring, and dismissal differ from goals of staff for more flexible job requirements, flexible job classifications that permit staff to shift jobs, and higher pay limits. Although managers hear complaints from employees frustrated by civil service rules, often these same employees forcefully resist attempts to remove the protections such rules provide. Moreover, in jurisdictions that lack home rule, civil service reforms must be approved by state lawmakers, and the local manager may not think it worthwhile to expend political capital lobbying for reform that is controversial among staff.
A less confrontational tack is to make changes at the margins. Recent civil service reforms in local governments have included eliminating the rule of three—in traditional HR systems, only the names of the top three candidates from a list of eligible job applicants, as judged by numerical scores, are forwarded to the appointing authority for possible employment or promotion. Expanding the hiring choice to the top ten candidates or to all eligible candidates provides more managerial discretion. Another reform is broadening job classifications—called broadbanding—so that managers have broader discretion in job assignment and workers are less restricted in the precise definition of their job class. Another is to exempt from the system particular job classes, such as staff of elected officials. This establishes a small cadre of at-will employees while it maintains civil service protections for most jobs.
Some local governments remove specific classes of hard-to-recruit jobs from civil service and hire contract workers; or they partition a particular enterprise into a public authority to insulate it from election cycles while freeing it to develop its own HR system. These cannot be considered reforms of the system, however.
Lessons can be learned from the states of Georgia and Florida, each of which has modified its civil service systems in recent years and eliminated protections for some or all workers. Advocates argue that such reforms allow managers to bypass time-consuming regulations, fill vacant positions quickly, reward good performers with bonuses, and remove poor performers without entanglement in lengthy appeals. Opponents argue that such reforms politicize the workforce, cause excessive turnover after each election, destroy the psychological contract between worker and employer, and discourage the best and brightest from applying. Early evidence is that some of the best as well as some of the worst occur.
Of great interest to managers considering reforms should be whether the proposed reform will make it more difficult to hire and retain the best and brightest. Will occasional political seepage threaten the stability of the workforce and drive away workers whose partisan leanings differ from those in power? Are at-will workers less likely to speak truth to power and less likely to reveal performance problems? No consensus on these questions has yet been reached in the reform states, and similar issues will arise in reform cities and counties. Attempts to overcome the frustrations inherent in civil service will continue, and every solution will bring its own complications.
HR functions
Human resource management involves a number of functions, from recruiting, hiring, and retaining workers, to designing job classifications associated with equitable pay scales, to conducting performance appraisal and employee development. Much of the dynamism in the HR field is due to a confluence of factors that are changing the face of the workplace—the growing diversity of the population, that mothers with young children now remain in the workforce, and that workers with demonstrated family obligations are often protected by federal law. Managers must pay attention to the growing importance of case law as it defines and constrains what was once considered administrative prerogatives.
Recruitment and retention Recruiting workers with the right skills and retaining trained workers are continuous challenges. The Internet is invaluable for recruiting outreach. Many jurisdictions now post job notices on their Web sites. Taking the job hunt to anyone with Internet access speeds the application process. For example, Englewood, Colorado, posts jobs on its Web site and applicants may complete and submit applications online (see www.ci.englewood.co.us). Many cities, although not equipped to manage online applications, post application forms in portable document format (PDF) on the Web so that applicants may print out the form, complete it, and fax or mail it. Some communities operate their own television stations and use them to broadcast job opportunities. For example, on WCOT, the television station operated by the city of Tallahassee, Florida, viewers see job vacancies posted several times each day along with a phone number to call and directions to the city’s Web site where they can see additional information as well as download an application form.
More local governments are using contingent workers. One way to avoid the stalemate caused by a rigid classification and compensation system is to hire contract workers to perform functions that are project oriented, of short duration, or that require expensive-to-attain skills—such as health care—that do not transfer to other jobs. A local government can either establish a job classification for temporary or part-time workers that carries with it none of the benefits or protections of civil service or contract with a firm to provide temporary workers. The advantages are clear: flexibility and thrift. The disadvantage is that contract workers need not be committed to public service and to the citizens. With job security comes the psychological contract between employer and employee that builds commitment to the mission. Nevertheless, for short-term projects or to access skill sets that are difficult to recruit, contract workers are a popular alternative to full-time, permanent employees.
For tasks not needed year around, seasonal contingent workers are routinely employed: summer grounds crews, the snow removal corps, the seasonal pool staff, lifeguards at beaches, and summer playground leaders. Contract workers can also be used to staff projects that will be of short duration and to carry out technical work for which there is a short-term need. Hiring interns from local colleges and universities also fits into this category.
Once an employee is hired and trained, retention becomes the challenge. Few workers today expect to spend their careers with one employer. Labor costs rise each time an experienced worker walks out the door and a new person must be recruited, hired, and trained. Monitoring morale, keeping communication lines open, and providing opportunities for personal growth and career development help to reduce turnover. New organizational designs such as self-managed work teams (SMWTs, discussed later in this section), are tailored to accommodate the new demands of the changing workforce.
Succession planning Preparing to fill vacancies in leadership positions is an area of human resource management where businesses do a better job than government. By identifying promising workers who have leadership potential and grooming them for promotion, a manager can minimize the lapse in performance that can occur when an experienced person leaves. Although strict job classification systems make it difficult to cycle those with management potential through a variety of jobs, the effort to add such an option is worth the time it takes. Without the staff in place to guide activities, financial and information resources go to waste.
The baby boomers who are dedicated to public service are quickly approaching retirement, and far fewer young people are following in their footsteps. This creates a large replacement gap in the public sector. This is particularly a problem in local government, which employs five out of every eight government employees.
Frank Benest
Management development programs become incubators for developing leaders at the same time that they provide personal and career growth for employees. Traineeships identify and groom talented people and prepare future leaders. Establishing a formal trainee program involves:
Mentoring A necessary component of retention and succession planning is to provide employees the opportunity to learn their way around the organization, acquire management skills, and develop leadership potential. Mentoring is a powerful tool for achieving this. Through a mentor, an employee learns existing rules and norms and acquires the savvy necessary for advancement. It also helps newcomers learn the ropes and integrate quickly into the unit. Although formal mentoring systems are used in some agencies, informal mentoring is often more successful. The most effective mentoring is done when experienced workers identify with junior workers, usually because they are reminded of themselves earlier in their careers. Senior staff take the newcomer under their wings, alert them to pitfalls, introduce them to influential people, and notify them of advancement opportunities.
Mentoring can play a large role in either retaining or repelling minority workers. Because mentors tend to help those who remind them of themselves, those of the local majority group tend to mentor those most like themselves and thus exclude members of the local minority group from the fast track. Diverse work teams that span departmental and hierarchical lines can lessen this problem. In addition, work teams can increase informal opportunities for networking among newcomers and old-timers, bringing majority and minority group members together and fostering mentoring relationships that, in the long run, work to the advantage of the entire organization.
Job shadowing—allowing an observer to accompany employees as they perform their duties—is another way to encourage mentoring. The observer learns about the tasks performed and the pressures and challenges of the job. By learning about the work first-hand, the observer has an opportunity to determine whether the job is a desirable career path. Job shadowing is effective at acquainting trainees and interns with work that is done. It also works well at the upper reaches of a jurisdiction, where it can acquaint leadership trainees with the mix of daily tasks that directors face.
Classification and compensation One of the hallmarks of civil service is clear-cut job classification paired with equitable pay schedules. Job classifications ideally provide an objective rationale for compensation rates, create equity among employees, and guarantee that equal work is compensated equally. The downsides are that rigid classifications impede a manager’s ability to take advantage of a worker’s skills and strengths that fall outside the formal job description and prevent a worker’s job enrichment. Correcting these problems requires time-consuming job reclassification. Collapsing groups of classifications into broad bands is one attractive solution.
Broadbanding Broadbanding—grouping jobs together—has been implemented in jurisdictions such as Maricopa County, Arizona, and Charlotte, North Carolina. HR experts rely on O*NET (www.onetcenter.org), an online information source administered by the U.S. Department of Labor’s Employment and Training Administration, to identify job families and place classes of jobs within relatively broad ranges rather than relegating jobs to narrow descriptions. Broadbanding gives managers the flexibility to promote and expand a worker’s duties without having to reclassify the job. While this frees both workers and managers from rigid job classifications and permits more discretion in job assignments, the trade-off is that it requires more supervisory discretion and opens management to charges of favoritism from employees who believe they are not being treated fairly compared with others in their band.
To avoid the downside, training is essential. Those who make job assignment decisions must be aware of the latitude available to them and avoid unfairly privileging some workers over others. In other words, the drawbacks are precisely the reason that narrow job classifications were developed in the first place.
O*NET The Occupational Information Network, known as O*NET, replaces the Dictionary of Occupational Titles (DOT) as the primary source of occupational information in the United States. O*NET is a comprehensive database of worker attributes and job characteristics; it contains information about KSAs, interests, general work activities, and work context. For HR experts, it provides a common language for defining and describing occupations and placing them into job families and classifications. It captures changing job requirements, and it facilitates career counseling, employment, and training.
Skill-based pay Skill-based pay is a new reward program that attempts congruency among an organization’s values, goals, and culture. It is a fundamental departure from traditional pay systems that pay employees for the jobs they hold. In skill-based pay, employees are paid for skills they are capable of using and not for the jobs they are performing at a particular time. This system frees management from a rigid adherence to compensation systems that are pegged to narrow job classifications. In theory, skill-based pay encourages career development because an employee can see direct financial rewards for acquiring additional skills.
As with many innovations, skill-based pay works better in theory than in practice because subjective evaluations enter the compensation system, and, over time, an inequitable pay structure with corresponding claims of favoritism may evolve. Reginald Shareef describes a skill-based pay attempt in the state of Virginia’s Department of Transportation and found that, unless there is a goodness-of-fit for all the systems that support skill-based pay, it fails.3 In the case Shareef studied, alignment among recruitment, performance appraisal, and goals of the work teams was missing. By the time the program ended, it was considered a failure by both managers and employees. Although laudable, Virginia’s experiment demonstrates the difficulty of reforming one aspect of the HR system without wholesale change elsewhere. On the other hand, some small jurisdictions such as Maryland Heights, Missouri, are experiencing some success with limited implementation of skill-based pay.
Performance appraisal Performance appraisal is connected closely with worker retention, job classification, and compensation, but the perfect performance evaluation has yet to be developed. Evaluations should deliver feedback to employees, provide a starting point for supervisor-worker goal setting, establish a record of performance, and aid promotion and work assignment decisions.
Each new type of appraisal promises to overcome the frailties of its predecessor, yet it, too, fails to satisfy. Neither behaviorally anchored rating scales (BARS), nor critical incident reports, nor trait ratings, nor management-by-objectives rating scales changed employees’ belief that they are rated subjectively rather than objectively; and supervisors believe that the evaluation formats prevent them from capturing realistically the performance of the worker. The more thorough the form, the more time it requires for completion. The more sophisticated the evaluation instrument, the more time-consuming supervisory training is required. And still the supervisor’s attention is drawn away from the work of the unit in order to focus on the intricacies of the evaluation process. Experimentation with various formats continues regardless, always in an attempt to find an instrument that achieves its purpose.
One promising attempt to match the performance appraisal process to the work environment is 360-degree performance evaluation. This is a multisource assessment technique, and its strength is that it requires ratings by not only a worker’s supervisor but also by peers and subordinates. It is especially useful for evaluating those who work in teams and who can succeed only if they work collaboratively, have good interpersonal skills, and are reliable teammates. Input from all their work colleagues presents a more comprehensive picture of performance than input from a supervisor only. The downside is that it is costly: such evaluations consume the time of multiple staff and create administrative burdens. Nevertheless, the concept moves the workplace a step closer toward integrating performance goals, workplace design, and individual performance, and it is more thorough than simpler instruments.
Focus on performance
A unit that is apathetic, unresponsive to change, and lacking in new ideas is unlikely to have any conflict, but it is also unlikely to have any energy. A unit that is disruptive, chaotic, and lacking in cooperation has too much conflict. Neither unit will be productive. The midpoint—where employees are self-critical, innovative, and eager to identify and solve problems—is the productive point. The term “organization development” captures the activities used to build capacity. As jurisdictions are challenged to maintain services while revenues shrink, capacity-building efforts focus on identifying and addressing human resource needs.
Public employees from solid-waste technicians to maintenance workers to firefighters to information technicians come to their jobs with skills ranging from manual-labor skills to highly sophisticated knowledge training. Encouraging high performance is not a one-size-fits-all matter. One of the most promising developments in recent years is the increasing diversity of the workforce. Another is the use of self-managed work teams. More traditional means of improving performance include training and reward programs.
Organizational development, known as OD, includes activities that facilitate planned, long-term changes in the attitudes and values of organizational members. In other words, its goal is to change organizational culture in order to improve performance. Training programs that emphasize interpersonal skills, collaboration, and socialization of new employees into the organizational culture help to integrate newcomers and minimize conflict. Organizational development encompasses those activities that prepare the organization for what is ahead; it trains employees about policies and procedures, plans organizational change, equips workers with new skills, and sensitizes them to changes.
Reframing management assumptions Donna Douglas, director of social services, Hanover County, Virginia, commented: “I was managing successfully, but I was not addressing the future; I had to think differently about what I was doing.” In the following year, she changed her management style from micromanagement to a team focus. She reframed her views on personnel to think of human resources as an asset, energized her workforce, and elicited a higher level of performance. “Anybody can do this and it will not cost one additional dollar to implement.”
Source: Anya Sostek, “Managing Performance: People Power,” Governing (January 2003): 54–55.
Although budgetary constraints and pay regulations make it difficult to award salary bonuses, managers have a number of ways to reward and recognize outstanding performers as examples for others to follow. Awards, for example, can include a designated parking spot, a plaque or photograph posted in a prominent place, a story in the office newsletter and on the Web site, or nicer office furnishings. Some jurisdictions hold an employee appreciation day or employee recognition breakfast to commemorate outstanding performance. Consistent, meaningful recognition builds a climate conducive to involvement, retention, and pride. Mollie Anderson, the Iowa personnel director, said, “We can’t offer cars or country club memberships or large bonuses, but it is very honorable work and it is inspiring.”4
Organizational justice With the new generation of workers comes the concept of organizational justice—procedural fairness, the expectation that employer actions provide all workers with equal opportunity to compete and succeed, and that no category of worker bears a disparate burden. Systems that are perceived as fair by employees, even though they may be cumbersome, trump processes that produce an adverse impact on one category of workers. Sensitivity to this concept will help managers navigate around claims of discrimination and other avoidable problems.
Young entrants to the workforce expect higher levels of autonomy and discretion over their work than prior generations, an expectation that necessitates greater reliance on participative decision making and flattened hierarchies. Another difference is that women now remain in the workforce through their childbearing years; this increases the need for employers to provide alternative work arrangements such as flexible work hours, telecommuting, job sharing, cafeteria benefit plans, and convenient day care. Jurisdictions that employ large cohorts of baby boomers need to plan for succession, ensuring that trained workers are ready to step into posts about to be vacated through retirements.
Diversity creates more complexity and more ambiguity in processes, yet it also holds promise of greater productivity. To prevent miscommunication and conflict, managers benefit from a deeper understanding of cultures and workers’ perceptions and expectations. In the short term, research shows that heterogeneous groups have more conflict and lower performance levels. Superficial diversity diminishes over time, however, as workers come to know one another as individuals rather than as members of a class. Demographically diverse work teams typically require a longer startup time than homogeneous groups; but once members of heterogeneous groups have worked together and develop a comfort level with one another, group output in terms of creative and sound decisions meets and then exceeds the output of homogeneous groups.5
Despite the slower startup time of diverse groups, heterogeneity positively affects team creativity and decision quality. Competing ideas and ideologies help to prevent groupthink. By injecting a degree of conflict and tension into team meetings, diverse membership contributes to airing alternatives and ideas that would otherwise be ignored or go unspoken. An additional bonus is that heterogeneous groups develop higher-quality ideas and solutions than homogeneous groups.
How things change! Clara Gordon Rubin’s career with the city of Seattle is an example of how much has changed. She went to work for the city as a typist in 1927. While working for the personnel department, she enrolled in night classes in public administration. In 1937 she was hired as a junior personnel examiner, the first woman to reach professional status with the city. In the late 1940s she received the highest score on the written test for chief examiner but was told the civil service commission would never hire a woman for that job. During the 1950s she played a key role in expanding job opportunities for African Americans and immigrants, and she was instrumental in making the city the first in the country to hire women as firefighters. She died in 2003 at the age of 94.
Source: Observer-Reporter, July 1, 2003, accessed online 7/1/2003.
Diversity brings additional perspectives and ideas and is a source of innovation and creativity, but fault lines exaggerate differences and introduce conflict. Diversity, by definition, includes multiple perspectives and experiences and correlates with task conflict, all the while it provides the potential for enhanced creativity. Severe conflict, however, can reduce satisfaction and stymie performance. If a work group is to take advantage of its diversity, it must learn to accept conflict over ideas while it disapproves of personal conflict. The negative effect of fault lines in a group diminishes as members accumulate common task experiences and mutual understandings. The most productive teams are usually those that have worked together longest.
Chapel Hill’s participatory management One of the characteristics of educated workers is that they expect to have a voice in decisions that affect their performance. Participatory management may have been one of several optional management styles in the past, but now it is the only acceptable style. Chapel Hill, North Carolina, for example, has a Human Relations–Management Relations Committee that meets on a monthly basis to receive information concerning personnel policies and to voice employees’ concerns about personnel-related issues. The committee consists of a representative from each department and from all levels of the town’s organizational structure. This committee plays a meaningful and substantive role in two-way communication between the town’s administration and its employees.
Source: Stephen E. Condrey and Svitlana Slava, “Human Resource Management Best Practices: The Case of Chapel Hill, North Carolina (paper presented at conference on best practices in local government and development, Uzhhorod National University, Uzhhorod, Ukraine, August 17, 2001)
Self-managed work teams Government workers equal or surpass private sector workers in education and intellectual skill because much public service work is knowledge work that requires workers to use their knowledge to do their jobs, in contrast with the private sector that uses labor to manufacture goods or perform tasks.6 Knowledge workers perform their duties in the absence of close supervision, and they exercise discretion in their decisions. Zoning regulators, building inspectors, caseworkers, and law enforcement officers all exercise discretion every day.
Because government depends on knowledge work, no one can know all aspects of a job. Work teams are therefore increasingly popular. Team building brings people together to work interdependently toward the accomplishment of a goal. In its largest sense, the entire jurisdiction’s workforce cooperates to achieve the overall goals. In a more functional sense, effective team building allows for cross-faulting strengths and weaknesses so that workers who are strong in one area but weak in another complement their colleagues with different strengths and weaknesses. Teams were once thought of as an OD intervention to help employees learn to work together more productively, but they are now used as relatively autonomous work groups called self-managed work teams (SMWTs).
These teams plan, organize, control, staff, and monitor themselves; they decide who works on what, where, and when; they control start-up and ending times, the pace of work, and goal setting; they are responsible for inventory, quality control, and work stoppage decisions; and they take action to remedy problems. Benefits of self-managed teams include less managerial overhead and more initiative, personal responsibility, creativity, problem solving, and self-reliance on the part of workers.
A 2002 study of U.S. cities with populations of 50,000 or more showed that 27.5 percent were using SMWTs (Table 5–1).7 Of these, 80.4 percent reported adopting SMWTs to improve productivity. Other reasons for adopting SMWTs included:
SMWTs are put together in a variety of ways. According to the study, some municipalities (counties were not studied) have adopted teams but have chosen not to allow full self-management. Others allow partial degrees of self-management, requiring management clearance before decisions are made that will have a budgetary impact. Still others allow some budgetary decision making but set a ceiling above which approval must be secured before moving forward. Each of these represents variations on the theme of SMWTs.
Of all cities that had adopted SMWTs, more than 85 percent were council-manager cities and over one-half had populations of 100,000 and above. Large cities possibly have more need for interdepartmental collaboration and flexible decision-making structures; they may also have enough latitude to experiment with teams. As shown in Table 5–2, managers report they and city employees rate SMWTs positively. They also believe that SMWTs reduce the cost of service delivery, increase the quality of services, motivate employees, and ease the work of the manager. Regarding citizen perception, one respondent stated: “Citizens don’t care as long as they get city services and taxes are not increased.” Another city manager wrote, “I don’t think they [citizens] care. They only care about outcomes.” Managers take note: when government works right, it is invisible. Only when services are not delivered in a timely fashion do citizens notice.
Table 5–1 Self-managed work teams in U.S. cities
|
Has your city adopted SMWTs? |
|
|
Yes |
27.5% |
|
No |
72.5% |
|
Why did your city adopt SMWTs? |
|
|
To improve productivity |
80.4% |
|
Productivity improvement and benchmarking |
5.4% |
|
Other reasons |
14.3% |
Source: Adapted from Mary E. Guy and Seung-Bum Yang, “Conditions for Effective Self-Managed Work Teams: Lessons from the U.S. Experience,” in Central-Local Relations and Local Government Reform in Korea, ed. Byong-Joon Kim and Glen Hahn Cope (South Korea: Korea Association for Policy Studies, 2003).
Table 5–2 Satisfaction with self-managed work teams
|
|
Mean |
Standard deviation |
|
City manager satisfaction |
3.71 |
.82 |
|
Employee satisfaction |
3.71 |
.84 |
|
Citizen satisfaction |
2.94 |
.80 |
|
Cost reduction |
3.20 |
.89 |
|
Quality improvement |
3.40 |
.83 |
Source: Adapted from Mary E. Guy and Seung-Bum Yang, “Conditions for Effective Self-Managed Work Teams: Lessons from the U.S. Experience,” in Central-Local Relations and Local Government Reform in Korea, ed. Byong-Joon Kim and Glen Hahn Cope (South Korea: Korea Association for Policy Studies, 2003).
For performance innovations to work, there must be congruence among all facets of the HR system. If SMWTs are the goal, then pay increases must be attached to team rather than individual performance. Workers should be selected who thrive when working in close collaboration with others; performance appraisals should evaluate the performance of the team and the individual’s contribution to it; and raises should be pegged to performance of the team, not to performance of the individual. In other words, subsystems should encourage and reinforce the behavior patterns that are sought.
Emotional intelligence Emotional intelligence refers to a person’s ability to perceive and express emotion and to regulate it in oneself and in others. It is linked to skill in managing one’s own emotion as well as others’, and it contributes to performance in all jobs where interpersonal relations are important. Many interpersonal skills required in public service jobs, including the ability to work with others, self-confidence, self-discipline, and personal initiative, rely more on emotional intelligence than on traditional intellectual skills. To some degree, the term emotional intelligence is a more specific name for what has been called “street smarts.” Emotional intelligence influences team performance, and the shift in workplaces to SMWTs has increased the attention that emotional intelligence receives. The relationship between cognitive skill and individual performance is well known, yet only recently has the importance of affective skill been noticed.
Emotional labor Related to the concept of emotional intelligence is emotional labor. Those who staff the counter at the information desk are expected to greet the 100th visitor of the day with the same sincerity and grace as they greeted the first. Those who staff the phone lines for city hall or the county courthouse are expected to be nicer than nice. Caseworkers must care about strangers; administrative assistants must perceive their directors’ moods and respond accordingly. This work is relational in nature and is called emotional labor.
Emotional labor is applicable to both men’s and women’s work but it is the emotions, such as caring and nurturing, required for relational tasks that are most often invisible in job descriptions, performance evaluations, and salary calculations. However, these are the emotions that are a mainstay of interpersonal relations, that grease the wheels so that people cooperate, stay on task, and work well together. Employees who exercise emotional labor are essential to work teams. Traditional job descriptions require only cognitive intelligence, and they disregard emotion work—making it invisible even though it is essential if customer satisfaction and citizen satisfaction are to be achieved.
Legal issues in the changing workplace
Managers are responsible not only for doing the right things but also for doing things right. Case law continues to evolve in the areas of employer liability for workplace violence, sexual harassment, safeguards for disabled workers and family and medical leave. It is most important to put in place sound, written policies; train all employees so they are knowledgeable about the policies; and follow the policies when incidents occur. The advice of a good city or county attorney is also integral. Jurisdictions lose in court when they fail to follow their own written employment policies.
Workplace violence Local government workers fall prey to workplace violence more often than workers in other enterprises. Law enforcement officers, social service employees, teachers, housing inspectors, and public works employees are in high-risk jobs, as are health-care employees, especially nurses who work in public health-care facilities. The Occupational Safety and Health Act (OSHA) of 1971 dictates that employers are responsible for any condition that represents a hazard to the life, safety, or psychological well-being of employees in the workplace. States have adopted varying statutes or policies that apply OSHA principles to local government. Civil law holds an employer responsible for negligent hiring, retention, or supervision. Although the courts are reluctant to hold employers liable for all acts of violence against workers, there is consensus that an employer and/or a manager who is aware of a danger or a harm has a duty to protect an employee who, while acting within the scope of employment, comes into imminent danger of serious harm. For example, social workers in rural counties in North Carolina were fearful because they sometimes worked in isolated situations. Counties then issued them cell phones. This is a change that does not sound like much, but it was a morale boost as well as a safety precaution.8
There are four types of workplace violence: violence by people unconnected to the workplace (robberies), acts committed by people who are related in some way to an employee (domestic violence, stalking), violence between employees, and violence by clients. Although media stories highlight employee-on-employee violence, only a miniscule number of people are murdered by a disgruntled fellow employee. Most women killed at work are victims of domestic violence or stalkers. Most men who are killed are victims of armed robberies. Regardless of the cause, employers are responsible for providing a safe work-place and for planning for possible crises. Courts have thus far been reluctant to hold employers legally liable for harm to employees. This is an area where the law is evolving.
Employee-on-employee and client-on-employee violence emerges from a convergence of factors: an individual’s propensity for violence; a situation that pushes that person beyond the capacity to cope constructively, such as job change or job loss, financial problems, personal hardship or family stress; and a setting in which it is possible to act. In all cases, the employer’s vigilance and preventive measures are required by federal and civil law. Sound judgment, teamwork, reasoned decision making, collaborative information gathering, and compassion will often prevent workplace violence, but this assumes that everyone has learned how to identify potential trouble spots and how to act when they occur. An effective policy contains instruction about behavioral indicators of potential violence and actions to take. Some employers combine sexual harassment with general workplace conduct standards; see, for example, www.cityofseattle.net/personnel/rules/rule_1.htm for Seattle’s workplace harassment policy.
A workplace violence policy should:
Sexual harassment Sexual harassment is a violation of the Civil Rights Act of 1964, which forbade discrimination on the basis of sex. For a number of years, few claims were filed and far fewer prevailed. This changed with the passage of the Civil Rights Act of 1991, which provided a framework more conducive to legal action. It set standards for employers when they attempt to justify discriminatory actions or policies based on business necessity; it shifted the burden of proof to the employer after the plaintiff has established a prima facie case; and it provides the right to a jury trial along with compensatory and punitive damages. Sexual harassment case law is evolving not in a straight line but as a progression of squiggles. Decisions differ on the basis of which court hears the case, the specifics of the complaint, and the arguments of the defense. There is consensus over the essential elements, however.
Sexual harassment is defined as unwelcome sexual advances, requests for sexual favors, and other verbal or physical conduct of a sexual nature when one of the following three conditions exists:
Case law has clarified two types of harassment on the job: quid pro quo and hostile environment. The former occurs when a direct demand is made for sexual favors in return for jobs, promotions, pay raises or the like; hostile environment harassment applies where no direct quid pro quo has been demanded but where conditions are permitted or encouraged by superiors that cause the employee to feel pressured into tolerating or participating in sexual behaviors.
The Mobile case demonstrates how an employer can walk the fine line between a sexual harassment lawsuit from the victim and charges of wrongful discharge on the part of the accused. The court decreed that the city could be held liable only if it knew or should have known of harassment and failed to take action. Because the city investigated swiftly and acted to stop the harassment, the city avoided liability even though it did not discipline the harasser.
The 1995 case of Fuller v. City of Oakland (47 F.3d 1523 [9th Cir.]) presents a different outcome. The case tested the sufficiency of the employer’s policies and procedures in an instance when the police department conducted an internal affairs investigation and offered the plaintiff a transfer. She refused the transfer, and the harassment later stopped voluntarily. The court found that the employer’s actions were inconsistent with its stated policy of strong disapproval of sexual harassment; therefore the court judged that the city could not avoid liability.
The difference that gender makes becomes obvious in sexual harassment training sessions. Women perceive sexual innuendo and harassing behavior as more threatening than men do; this difference accounts for much of the confusion over acts that to women are harassing and to men are harmless. Training sessions that involve open communication about miscommunication are constructive venues for sensitizing employees to how the opposite sex perceives behavior. Combined with a policy and procedure statement with which all employees are familiar, training will help to prevent claims of harassment. An employer that has a sound policy and procedure in place, has trained its employees in the policy, and acts swiftly in accord with the policy when sexual harassment becomes known is likely to prevail if the claim progresses to legal action.9
Public work, private lives Effective legislation reflects a nation’s values and traditions. Two relatively recent laws, the Americans with Disabilities Act (ADA) and the Family and Medical Leave Act (FMLA), were written to ensure flexibility for employees who do not fit the mold of the perfect employee unfettered by family obligations, health problems, or physical limitations. The ADA was passed in 1990 to eliminate discrimination against individuals with physical or mental impairment that substantially limits one or more of the major life activities, individuals with a record of such an impairment, and individuals regarded as having such an impairment. The function of the law is to make employers disability blind as they make personnel decisions and disability conscious as they accommodate employee needs. Remedies for violations of the ADA are the same as for noncompliance with the Civil Rights Acts of 1964 and 1991. As the years pass, the law has been used to test not only an employer’s reasonable accommodation to an employee’s disability, but also to test an employer’s liability in cases when an employee has an extended illness.
To establish a prima facie case of discrimination under the ADA, a plaintiff must show:
The ADA of 1990, as amended by 42 USC §12101 et seq., prohibits covered employers from discriminating against an employee on the basis of known physical or mental impairments, provided that the employee is a qualified individual with a disability. A qualified individual with a disability must satisfy the requisite skill, experience, education, and other job-related requirements of the employment position and, with or without reasonable accommodation, the individual must be able to perform the essential functions of the position. Courts have chosen to interpret the law strictly—narrowly defining terms and usually deciding for the employer rather than for the plaintiff.
The Family and Medical Leave Act of 1993 (FMLA) covers all employers with 50 or more employees who are employed for at least 20 weeks during the year. Covered employees are entitled to 12 weeks of unpaid leave during any 12-month period for the recent birth or adoption of a child; to care for an ill child, spouse, or parent; or for the employee’s own health condition that precludes working. Because FMLA was intentionally couched in somewhat vague terms, only partially clarified by the final regulations promulgated by the U.S. Department of Labor in 1995, employers must look to the courts for guidance in complying. The courts, in turn, look to legislative intent. The purposes of the act include:
To state a claim under the FMLA, a plaintiff must prove three elements at trial:
The importance of policy and training The rule of thumb for the manager in all these areas—workplace violence, sexual harassment, reasonable accommodation for disability, and family and medical leave—is that prevention is the best policy. Develop sound, written policies and procedures to govern workplace behavior. Communicate these policies to all employees in as many ways as possible, and make sure that written copies are accessible to everyone. Ensure that refresher training in these policies occurs on a regular basis. Most important, make sure everyone follows the policies.
A review of case law shows that complaints rarely have “clean margins.” Instead, plaintiffs often claim simultaneous violations of ADA and of FMLA. Court testimony reveals managerial frustration with the employee’s use of leave as well as employee perceptions that supervisors are spiteful. It is usually obvious that tensions mounted in the office before the event that resulted in the legal claim. Early action may nip problems in the bud.
Budgeting and managing financial resources
Failure to manage money wisely has shortened the careers of more than a few local government managers. Financial management comprises budget development and execution, debt management, revenue management, purchasing, short- and long-term cash and investment management, risk management, financial accounting and reporting, internal auditing, and management controls. All these elements should be integrated within one comprehensive financial management system. No one can be expert in all of these areas, but the successful manager has to know enough about each to build an effective financial management team.
All federal agencies, as well as some local governments such as Scottsdale, Arizona; Wayne County, Michigan; and Cook County, Illinois, have created the position of chief finance officer (CFO) to enable top financial managers to better contribute to the making of high-level strategic policy.
The ICMA Task Force on Continuing Education and Professional Development has identified competencies and skills in both budgeting and financial analysis.10 Managers are expected to know about budgeting principles and practices, financial control systems, characteristics of revenue sources, ways to forecast revenues and expenditures, and to be skillful in communicating financial information. They must know how to assess the fiscal condition of their communities, be able to determine the cost-effectiveness of programs, and possess skills in the analytical techniques needed to compare alternative expenditure and financing strategies.11
I got into city management because of a desire to do public service. I started out in the numbers game and learning the money side of it. Most government is dictated by the budget.
Debra Brooks Feazelle
Monitoring financial health
A community should have a financial checkup from time to time. Just as physicians learn diagnostic frameworks to analyze the health of their patients, local managers need a diagnostic framework to discern the financial health of their governments and communities. Private companies that issue credit ratings for governments use their own proprietary diagnostic frameworks. For local managers, ICMA has developed an excellent diagnostic framework, the Financial Trend Monitoring System (FTMS).12 It encompasses information about organizational factors, environmental factors, and financial factors.
Analyzing the organizational factors requires a top-level review of both legislative policies and management practices. A legislative commitment to “no new taxes” is an example of an organizational factor that can make it difficult to balance the budget when recession causes a drop in revenues. Environmental factors include national and regional economic conditions, unfunded state mandates, changes in citizens’ attitudes toward taxes and services, and the potential effects of disasters and emergencies. Specific community needs and resources, tracked through community trends such as a growing or aging population, declining property values, or increased unemployment should be emphasized. Financial factors include revenues, expenditures, operating position, debt, unfunded liability, and capital plant. Annual reviews of these data and trends, perhaps at the outset of budget hearings or in conjunction with a review of comprehensive plans, can help elected officials think strategically about needs and priorities.
Budget development and execution
Budgeting is the set of activities that is necessary to develop, implement, and evaluate a plan for the provision of services and capital assets. The budget is that plan. The budget is the most important plan of any government because through it, all other plans are accomplished. The Government Finance Officers Association (GFOA) gives Distinguished Budget Presentation Awards to local governments that demonstrate proficiency in four areas:
In the early 1930s, ICMA sought close linkages among planning, programming, and budgeting.14 ICMA developed an executive management–oriented budget system that called for preparation of budgets and enactment of appropriations on a program basis and for the setting of goals and objectives. It emphasized the establishment of cost standards, performance measurements, and monthly reporting of accomplishments relative to costs. In that budgeting system, ICMA anticipated nearly every subsequent budget reform for the remainder of the twentieth century.
In the 1990s, ICMA participated with other national organizations in the establishment of the National Advisory Council on State and Local Budgeting (NACSLB). In 1998, the NACSLB released a set of recommended budget principles and 59 specific practices that closely mirror the budgeting system that ICMA had pioneered nearly seven decades earlier.15 Now, for the first time, local governments have a comprehensive set of principles and practices around which they can organize their planning and budgeting activities. The recommended practices call for a goal-oriented approach to budgeting that encompasses planning, development, adoption, execution, and evaluation phases of the budget.
Framework for budgeting established by the NACSLB
Element 1. Assess community needs, priorities, challenges, and opportunities
Element 2. Identify opportunities and challenges for government services, capital assets, and management
Element 3. Develop and disseminate broad goals
Element 4. Adopt financial policies Element 5. Develop programmatic, operating, and capital policies and plans
Element 6. Develop programs and services that are consistent with policies and plans
Element 7. Develop management strategies
Element 8. Develop a process for preparing and adopting a budget
Element 9. Develop and evaluate financial options
Element 10. Make choices necessary to adopt a budget
Element 11. Monitor, measure, and evaluate performance
Element 12. Make adjustments as needed
Capital programming, project management, and debt management
Planning for the acquisition, maintenance, and replacement of capital facilities is usually reflected in a separate capital budget that complements the operating budget. Jurisdictions with a good capital programming and budgeting process keep abreast of the public infrastructure needs of the community—streets, sewers, schools, public buildings, computers, and communication networks, for example. Although the revenues and expenditures of an operating budget need to be balanced annually (borrowing beyond a budget year to finance current operations is a danger signal of fiscal crisis), it is prudent to incur long-term debt to finance some forms of infrastructure. A project that can generate its own revenues sufficient to offset many of its costs (such as a toll road, swimming pool, or performing arts center) is suitable as a capital project. Similarly, in rapid-growth communities, it is wise to borrow money to build larger projects (such as wider roads or bigger sewer lines) at the outset, rather than build too-small infrastructure that will have to undergo costly expansion later. With debt financing, future residents’ taxes and user fees help pay for the facilities they will use.
Elected officials have a difficult job. They hear from neighborhoods that are angry about things like traffic problems, and they demand traffic lights and speed bumps. But the money is not always there to address the needs that citizens have.
Tom Mauk
When a jurisdiction decides to borrow money to finance capital projects, it needs to develop sound debt management policies. Debt must be managed wisely to obtain a good credit rating, and higher ratings save taxpayers money through lower interest rates. Government policies that identify criteria for incurring debt and that limit the debt that can be incurred are essential. When a government decides to market debt, it enters the arcane and highly sophisticated world of municipal finance,16
a world inhabited by specialists—bond advisers, bond counsel, underwriters, mutual fund managers, and insurers. Specialized advice and counsel from experts who have solid track records are advised when entering this world.
Budgets, especially capital budgets, should be linked to a community’s comprehensive plan and to its long-range functional area plans (e.g., transportation). Those plans, in turn, should be based on assessments of current and future community needs. Citizen participation and guidance are important in identifying those needs because failure to seek citizen participation increases the likelihood that voters will reject a capital project.
Once the needs for capital facilities are identified, they must be translated into specific projects for either the construction of new facilities or the maintenance of existing infrastructure.
Project management skills on the part of project managers are an essential component of good capital programming and budgeting. Project managers identify all activities that must be performed at each stage of a project, identify the resources needed to accomplish each step, assign responsibility for accomplishing them, and continuously monitor progress toward the project’s completion. Fortunately, planners and budgeters can now use moderately priced project management software to plan, budget, and manage capital projects. Good project management seeks to avoid costly change orders to ongoing construction projects as well as the costly litigation that often accompanies major construction and technology projects.
Revenue management
Apart from an occasional sale of property and earnings from investments, jurisdictions have six ways to obtain revenues: taxing, charging user fees, levying fines, charging fees for permits, receiving federal or state intergovernmental transfers, and borrowing. Businesses and individuals can be taxed in three ways: when they obtain money (income taxes), when they spend money (sales taxes), and when they have some form of wealth (real or intangible property taxes). Most states sharply constrain the ability of local governments to tax sales and incomes, but in some states taxes that are not based on property have approached or passed property taxes in importance. Property taxes often lag behind the growth rates of local economies and are frequently insufficient to meet local needs. Consequently, managers are often instructed to search for new forms of revenues.
User charges are a popular alternate revenue source; they substitute for tax-based funding of some services. Solid-waste collection services were once commonly funded by property taxes, but user charges for those services are the norm in most local governments today. In locales with considerable amounts of new real estate development, where allowed by state law, local governments charge developers “impact fees” that are used to build infrastructure to support the new development. It is expected that developers, in turn, will pass the cost of fees on to buyers in the form of higher real estate prices. Utility franchise fees, paid by utility companies such as cable and telephone companies to do business within jurisdictional boundaries, are important revenue sources to many local governments.
Several criteria should be used to evaluate changes in revenue policies:
Forecasting future receipts is an often neglected aspect of revenue management. Good forecasting requires accurate records of past receipts and using them to build forecasts. Few local governments develop elaborate economic forecasting models that are commonly used at the state level. On the other hand, inexpensive software can be used by local governments to forecast revenues under varied sets of assumptions. Only those methods that staff can understand, and explain well, should be used. Also, managers should not hesitate to question and challenge the assumptions upon which revenue and expenditures forecasts are based. Experience has shown that good forecasters are those who are most likely to challenge their own assumptions.
Local leaders are often tempted to offer special deals—reductions in taxes or fees—to entice a company to locate nearby. When competition between governments leads to excessive giveaways, new development can lay an additional tax burden on taxpayers or cause underinvestment in education and infrastructure that are essential for building a high-wage economy. Effective managers ensure that their staffs carefully investigate the potential costs—not just the benefits—of offering financial deals to attract companies. (For more on economic development, see Chapter 4.)
Purchasing, privatization, and smart buying
Governments produce goods, such as roads, services, and recreation. Consequently, every government faces make-or-buy decisions. It must choose whether to produce things with its own employees or with outside contractors. Few would build a road with the jurisdiction’s own workforce, but many use jurisdiction employees to maintain roads. Most hire their own police officers, but some contract with other governments to provide law enforcement. Purchasing (also known as procurement) is as old as local governments. The nature of purchasing is changing, however, due to electronic technology, especially the Internet and desktop computing, and the shift in popular attitudes in favor of privatization. Governments, therefore, are relying more heavily on purchasing to provide goods and services, and local governments must be smart buyers.
Government purchasing must be done scrupulously within a formal legal framework. Many governments once behaved like private businesses, which can buy from whomever they please, including close relatives; but the Progressive reform movement of a century ago produced a legal framework for purchasing that still prevails today. That framework requires governments to solicit bids in a competitive manner and award contracts on the basis of a formal analysis of objective factors such as costs, quality, and vendor reliability. When competition is limited, or one contractor is in a uniquely advantageous position to provide goods or services, purchasing regulations typically allow a government to negotiate a contract with that provider. Negotiated contracts are common for social services, where competitors are often few and government does not want to disrupt continuity of care. Unfortunately, it is common for disgruntled contractors or losing bidders to bring lawsuits against governments. Well-trained professional purchasing specialists can help to avert expensive legal proceedings.
Laws and regulations that govern procurement are often outmoded to the point that they inhibit some of the practices that produce the best value. For information technology, for example, the best way to get value for the taxpayer is to hire talented purchasing agents and create the conditions through which they can persistently press for value when they are buying electronically related technology and services.17
Government becomes a smart buyer when it creates a first-rate purchasing office imbued with a sense of value seeking. Such an office provides its buyers with the authority to work creatively with contractors to solve problems and to build performance incentives and measures into contracts. Smart buying, on the other hand, is far less likely to happen if bidders for contracts are allowed to use connections with elected officials to influence purchasing decisions. Purchasing laws should disqualify offending bidders.
Cash and investment management
Government managers have a stewardship obligation to assure taxpayers that their monies are handled carefully and invested wisely. Even small governments receive and disburse large amounts of money. Although the management of cash and investments is a specialized activity, it is still a management responsibility.
If governments manage their own pension funds, the amounts invested can be large, and professional management of retirement funds is essential. Although locally managed retirement systems are common, many states enable local government employees to participate in a state-managed system. Various organizations, such as state associations for local governments, manage pension and related-benefits funds.
The governance structure should be capable of selecting sound investment managers, monitoring their progress, and deciding investment policy. Managers must guard against accruing large, unfunded pension liabilities, which come about by promising additional retirement benefits to employees such as police and fire fighters, but not allocating enough to make the needed investments in their pension funds. Monitoring unfunded pension liability is integral to the ICMA Financial Trend Monitoring System.
Risk management
Governments engage in activities that can cause substantial losses of money and even bodily harm. These activities should be managed in ways that reduce the likelihood of incurring such losses. The process of identifying risk and taking steps to avert losses is called risk management. Assessing the potential for losses associated with investments is integral to investment management. Other categories of loss that a community can face include property loss exposures, liability loss exposures, and exposures to employee injury. Risk management overlaps with disaster planning for the government’s own continuity of operations.
Many actions of government employees can cause harm to citizens, and governments are often legally responsible for compensating citizens for that harm. Appropriate policies should be adopted to reduce the likelihood of causing harm. For example, to reduce the likelihood of harming innocent bystanders, police often adopt policies that authorize high-speed pursuit only to apprehend imminently dangerous violators such as armed robbers on a crime spree.
Risk managers should challenge any policies that sanction unnecessarily risky behavior. They should also ensure that all offices have well-crafted policies and procedures for dealing with workplace violence. Finally, risk management policies need to address questions of self-insuring, sharing risks with other governments in pooled arrangements, and purchasing catastrophic insurance coverage.
Financial accounting and reporting
Accountants are experts in capturing information about financial transactions, recording that information, analyzing it, and reporting it to stakeholders who need to know about a government’s finances. It is their professional responsibility to work with management to design financial information systems that help managers monitor progress and make decisions. Nevertheless, friction sometimes occurs between managers and accounting professionals. To better manage this relationship, it is helpful if managers understand the role and responsibilities of accountants.
Good accountants pay close and careful attention to the details of what they do. The best accounting is that done according to a series of generally accepted accounting principles (GAAP) that describe specific procedures for accountants to follow and formats for the financial reports issued by a government. The recognized standards-setting authority for state and local governments in the United States is a nonprofit body known as the Governmental Accounting Standards Board (GASB). For accountants whose governments follow GAAP, a pronouncement by the GASB has the strength of a legal proclamation. Accountants in recent years have had to learn a new, more comprehensive, and more user-oriented format for reporting government finances. Failure to follow GAAP in all respects can lead to a qualified audit opinion—an accountant’s worst nightmare—in which an outside auditor expresses reservations about the accuracy of financial reports and declines to give a clean opinion. If accountants feel that management wants to alter accounting procedures or make statements in a financial report that could jeopardize the prospects of getting a favorable audit, they feel professionally obligated to resist management.
Some individual accountants may simply resist changes that should in fact be made, perhaps because they are using outmoded accounting software that makes it difficult to serve the information needs of managers. Effective managers need to learn enough about accounting processes to recognize the difference between professionally responsible resistance and outright unwillingness to change.
Auditing and management controls
Effective managers learn not to fear auditors but, instead, to use audits strategically to improve the operations of a government. There are two categories of auditors: internal auditors who work for the jurisdiction’s executive and external independent auditors. There are also two types of audits: financial audits that review a government’s financial operations to assure that reports fairly present the status of its finances, and performance audits that focus on the processes, costs, outputs, and outcomes of programs. Each type of audit can also include a review of ongoing activities to assure that they are in compliance with legal requirements. Both financial and performance audits can provide valuable information to improve the operations of a government.
Newly appointed managers are sometimes wise to request that audits be done of the operations for which they are responsible. The information gained can be used to remedy problems before the manager has been on the job long enough to receive blame for them. Auditors are trained to look for weaknesses and shortcomings, but they can also be valuable for recognizing the strengths (called “noteworthy accomplishments” in the jargon of auditing) of an organization. Managers should encourage auditors to inform them of noteworthy accomplishments as well as shortcomings. Both types of information are essential for framing well-conceived strategies.
Auditors can be especially helpful to managers when they review a government’s internal controls, which are also called management controls to underscore that managers are responsible for implementing them. Internal controls are the various rules and procedures, such as separating the receipt of cash from the disbursement of it, that are applied to prevent fraud, waste, and abuse of money and other resources. The best training programs on management controls emphasize that internal controls begin with an overall climate of ethics and stewardship that is encouraged by management. Without strong organizational commitments to ethical behavior and to the concept that all public servants owe their fellow taxpayers proper management of their money, the specific techniques that are collectively called internal controls could easily fail.
An effective financial management team
Managers are responsible for seeing that the components of a government’s financial operation work together smoothly. One way of meshing these operations is to emphasize the development of an integrated financial management system, often referred to as an enterprise resource planning (ERP) system. The meetings and team building required to develop and implement such a system will often reveal junctures where problems exist and how differences in perspective can lead to struggles for authority. Local governments today are fortunate because good, commercial, offthe-shelf software exists around which a comprehensive system can be built. The manager needs to set the tone by regularly reminding all concerned that financial services should be customer oriented, in other words, all employees of the financial units of a government should be attuned to serving the needs of internal customers (the other units of a government) as well as external customers (the citizen-owners of a government). Effective management of financial resources requires effective management of both human resources and information resources. Developing an integrated financial management system makes that abundantly clear.
Managing information technology resources
Human resource management and financial management have long been essential components of local government administration; information technology (IT) is a newcomer. IT still suffers from the perception that it is for technically savvy managers, system analysts, programmers, and even webmasters to handle. The reality is that IT is integral to local government management at all levels. Arvada, Colorado, and Fairfax County, Virginia, are just two of many local governments that have adopted comprehensive IT plans, recognizing the strategic importance of IT to the mission of the organization.18 Like Fairfax County, many medium to large local governments have added a chief information officer (CIO) to the management team.
IT performance criteria Governing magazine’s annual Government Performance Project evaluates city and county IT with these questions:
Source: “How We Grade Them,” Governing (February 2002): 37.
Now e-government (or e-gov), the common label for Web-based government applications, has brought IT to the forefront of every local government manager’s agenda. Whether for promises of cost savings, better service, increased capacity, or a host of other benefits, e-gov efforts are trumpeted in every trade publication. Despite the good publicity, many of these efforts fail. A recent ICMA study finds that many of the expected benefits, such as cost savings and downsizing, have yet to be realized.19 Government IT projects over the past three decades offer several lessons for managers:
Managers should be healthy skeptics, never forgetting the primary goals and values of public service. The job is to serve the public, not the technology. Managers do not need to understand technical details; they should focus instead on what technologies can do for the community. What are reasonable benefit expectations? What are the costs? Does the organization have the needed resources? Being IT savvy means understanding that technology involves not only technical issues but also managerial and policy issues.
What is e-government? Most people immediately think of government Web sites when they think of e-government. E-government also applies to less-visible Web-based applications that improve internal local government processes like budgeting, asset management, traffic control, and procurement. According to an ICMA survey conducted in 2002, the majority of local governments with populations over 25,000 now use an intranet; almost two-thirds of those with populations over 10,000 use a geographic information system (GIS); and two out of five local governments now purchase equipment online.
According to the same 2002 survey, three out of four local governments maintain Web sites. The most common Web site applications, aside from sharing of general information, include online delivery of requested local government records, online service requests to the local government (for example, for pothole repair), and online communication with local government officials. Online payment of taxes, utility bills, and fees and online completion of permit and business license applications have been implemented by only a few local governments.
Sources: Evelina R. Moulder, “E-Government: Trends, Opportunities, and Challenges,” in The Municipal Year Book 2003 (Washington, D.C.: ICMA, 2003); Evelina Moulder, E-Government: What Citizens Want; What Local Governments Provide, Special Data Issue no. 5 (2002) (Washington, D.C.: ICMA, 2002); and Evelina Moulder, Inside E-Government: Applications for Staff, Special Data Issue, no. 6 (Washington, D.C.: ICMA, 2002).
Technical, managerial, and political concerns
The manager must consider technical, managerial, and political issues when managing IT resources. Stability of the technology is an example of an important technical issue: Is the technology being evaluated for purchase considered a proven technology? Avoid “bleeding edge” technology despite its tempting coolness factor. Will the technology integrate into existing hardware and software? Technical incompatibilities and complications can be costly to a jurisdiction that implements untried or very new technologies. Managerial issues concern personnel and training, deciding whether to outsource, developing an organizational structure for IT operations, and providing project planning and evaluation skills. Political and policy issues include citizen expectations, pressure from elected officials (who are being lobbied by vendors), and legal requirements for handling and providing information (which can sometimes conflict, as when citizen privacy collides with freedom of information).
Technical, managerial, and political issues are usually inseparable. For example, complex and overlapping questions arise when a jurisdiction ponders an online permitting application: Should it be built in-house or contracted out? If it is designed in-house, can it be maintained? If a vendor maintains it, how can accuracy, security, privacy, and information access be addressed? What exactly will the application do: provide electronic copies of applications for download or actually process them online? Should the application completely replace a paper process? Does that limit access to only citizens with Internet connections? Should the application be designed to handle multiple permitting processes across agencies, or just one? What if a council or commission member has a preferred vendor, or despises one, for reasons unrelated to the quality of their proposal? How will the application’s operating costs be covered? Can cost savings be assumed? What about charging a user fee for the system? If so, how much should it be in comparison with any paper-based fees?
A geographic information system (GIS) is a good example of a technology that can bring privacy, efficiency, and effectiveness goals into conflict. GIS databases can expose AIDS patients and lead criminals to vulnerable children, but they can also help police pinpoint drug markets and chop shops. GIS greatly improves the manager’s ability to communicate with staff, elected officials, and citizens; but managers must monitor carefully how it is implemented and always balance citizen privacy concerns. Managers will also face the issue of AVL, automatic vehicle location, which upsets both police officers and public works employees.
In sum, technologies should always be evaluated as applications that serve the public, directly or indirectly. The importance of remembering to address technical, managerial, and political concerns cannot be overstated. See page 142 for a description of Miami-Dade County touch-screen voting for a case in point.
Critical issues in IT management: What a manager should know
Lessons from the field provide insight into technical, managerial, and political concerns that are likely to be encountered in IT management. IT challenges arrive as project proposals for online permitting, webcasting of commission meetings, mobile meter reading, and automated budgeting. Proposals will come from all quarters—employees, vendors, elected officials, and citizens.
Complicating the landscape is the fact that what works for one jurisdiction may not work for another, if for no other reason than the level of resources and support varies from government to government. The Gartner Group, a respected government IT management consulting firm, notes that more than 60 percent of large IT projects fail.25 Neglecting a basic evaluation of the potential application can be one cause of failure. Sophisticated evaluation techniques, many touted by vendors as proprietary methodologies, can be useful for very large applications; but for smaller projects, complicated methodologies can be overkill. The professional IT staff can produce a managerial summary instead. For the evaluation, a manager must keep in mind personnel capabilities and costs, possible benefits in terms of not only cost savings but also service improvement, the role of vendors, and the local government’s relationship with vendors.
What personnel capabilities will be needed and what will be the cost? Estimating cost is tricky. Too often, hardware and software are assumed to be the only costs. Whether employees have the technical skill and time to build an application is usually considered in the evaluation, but the next question is often forgotten: Do employees have the time and expertise to maintain it? Hardware and software are not the major expenses of an application; training and maintenance are. Whether IT staff build the product or a vendor develops it, employees must like and understand it; otherwise the entire operation must be outsourced to reach its potential. Steven Reneker, CIO of Riverside County, California, says that 90 percent of the county’s IT projects get resources only for hardware and software. Implementation, training, and maintenance costs have to be absorbed, which can result in reduced service levels.26 Application support, training, and maintenance often take more than 50 percent of any budget, and such costs must be considered in any proposal.
What benefits can be expected? Traditionally, data processing and storage applications were evaluated by implementation timelines, potential political difficulties, and cost; and the lowest cost or best cost-savings was used. As newer IT applications promise measurable benefits, however, evaluation of potential and existing projects should be more sophisticated.
Experience demonstrates that promised savings tend to be exaggerated. For example, efficiency gains from an online system seldom reduce staffing costs. Pentup service demands and the need to continue to offer services in the traditional way (to insure access to those with disabilities or without Web capabilities) often preclude staff reductions. The new application may also increase demand. And the new application must be supported.
Improved service delivery and better customer satisfaction are often cited as benefits of new technology, but in an era of tight budgets, local governments should do their best to demonstrate more tangible benefits with clear performance measures. These need not always be in monetary terms. For example, an online kennel for an animal shelter can be evaluated by tracking adoption rates. If the local government intends to reduce its printing costs by posting downloadable forms online, it must measure the demand for printed forms. Has it gone down? What about incorrectly completed forms? It may be that before the local government provided forms online, citizens completed the form onsite with staff assistance or review. If they download it, they likely completed it at home and then dropped it off, with a greater chance of error.
Benefits are sometimes intangible. For example, a GIS can improve decisions regarding land use, but it is difficult to quantify this benefit.
What will be the role of vendors? Government IT faces significant challenges in working with IT vendors. Many local governments do not require bids on professional services contracts—the category of much IT work—which increases the chances of pressures from elected officials and faulty vendor relations.
Despite the problems, Miami-Dade paid ES&S almost 90 percent of the contract amount after the primaries. County attorneys claim the company could have abandoned the jurisdiction before the November elections.
An ongoing investigation has prompted speculation that the inspector general’s office may even recommend selling the voting machines back to ES&S or to another county.
Source: Karl Ross, “Payment for Vote Machines Disgusts Commissioner,” Miami Herald (26 February 2003), 5B,
Many jurisdictions also lack the technical expertise to adequately manage the procurement of technical systems. The manager is responsible for making sure that the government has good advice and a sound procurement process in place.
To avoid cost overruns, the local government needs to either avoid multiyear contracts for application development, especially contracts that extend beyond the political cycle, or retain the ability to back out if not satisfied with a vendor.
Finally, local government should look for vendors with government experience. E-gov success relies on a clear understanding of the uniqueness of government work; firms hoping to transplant a business application usually fail.
Critical issues in e-government management: What the manager needs to know
The public face of e-government, the local government Web site, is a visible communications tool that the manager will want to ensure is managed carefully. E-gov applications often are built on a Field of Dreams philosophy: “if we build it, they will come.” Sometimes potential users do not rush to the product, and sometimes they overload the system. A series of management decisions will determine whether the outcome achieves a balance.
A local government need not develop its Web site from scratch. Many vendors offer full site development services. However, procurement of e-government applications poses special challenges. Local governments often have difficulties forming requests for services. Because e-gov is transforming the way government works, not just automating an online process, simply asking for bids to create a Web site is ambiguous and misses the point. Contracting for the work in stages is the best strategy. A local government manager can first bring in an outside firm to help re-engineer processes to be put online. Once an organization knows how it wants the process to work, the description should be outlined in a request for bids.
Many smaller governments get offers from vendors to host government Web sites for free or for dramatically reduced rates. These relationships can introduce problems. Citizens sometimes cannot discern whether such sites offer official government information or private marketing. Also, if a jurisdiction subsequently decides to create its own site, the vendor may balk at removing outdated information or relinquishing the Web address. If vendors host actual transactions for government, significant privacy and security concerns arise. Even a seemingly cost-free arrangement with an employee can cause problems if the employee leaves the government and takes away the necessary knowledge for maintaining the site.
Recognizing the needs of smaller local governments, many states offer assistance ranging from simple hosting to application development and support. Local governments should check with their state IT offices to learn whether such assistance is available. ICMA, in partnership with the Minnesota League of Cities, Qwest, and Microsoft, offers GovOffice, a Web site creation and content management system. (See www.govoffice.com.)
Managers need to ask a series of questions about any proposed Web applications:
Who are the customers and what are their expectations? E-government applications can be government to government, government to business, or government to citizen. Of these, government-to-business applications (for example, licensing and building permits) are the most common. This framework clarifies the nature of the relationships and expectations, but it is simplistic: it ignores the reality that most applications should cut across these lines.
For example, consider a common government-to-business transaction: building permits. Builders can use the Web to file permit requests, check permit status, and schedule inspections. However, citizens can use permit data to check whether that lot clearing down the street has a permit or whether the contractor they are thinking of hiring to fix the roof is licensed. Other jurisdictions might reference the site to validate work histories and licenses cited in bid applications or license requests. This variety of potential customers was a key consideration for Santa Rosa County, Florida, when it developed its online building and contractor records system (see http://src.whinc.net/srpermits/index.html).
Application development should also consider customers’ differing backgrounds and varying levels of computer expertise. For example, the Suwannee River Water Management District, in Florida, created three basic interfaces for its permit information: one for an average citizen, another for a commercial or industrial firm, and yet another for the agricultural and forestry community (see http://www.srwmd.state.fl.us/services/permitting/default1.htm). These divisions reflect different permits and different levels of understanding of the permit process. A citizen needs more help to understand which permits are needed for a boat dock or a water well, but a professional firm may just want to get to the form. The Suwannee Web page is not complicated, but it is unusual because it tailors a specific service to levels of customer sophistication.
The mix of customers and interests creates interesting although often treacherous political landscapes for local governments. Property tax records online cause realtors to howl that such access makes it easy to determine the last price paid for a house, but home buyers like it for the same reason. Some citizens consider online records an invasion of their privacy (although they know they are public data), and others happily use them to compare their assessed values with values of other property owners and perhaps complain of a high appraisal to the property appraiser’s office. Likewise, building permits are not immune to political crosscurrents. Environmental groups may perceive, rightly or wrongly, that streamlining the permitting process for developers encourages development. Like so much of public policy, improved service delivery is not favored by everyone.
Privacy is a hot topic. Businesses want access to public records for marketing purposes, but citizens do not want personal information shared without their express consent. A number of legislative bills at the state level address the issue of corporate use of information and provision of government data to corporate interests. The concern is broader than e-government. Data matching and data mining allow far more personal details to be collected than ever before. Advocates of these techniques cite the benefits of better law enforcement and service provision, but the power of these techniques creates privacy risks.
The position of the business community is that a user must expressly deny—in other words, opt out of—the use of personal data for other purposes. Consumer groups argue that opting out is ineffective.27 For government, an opt-in strategy is perhaps best: jurisdictions should have clearly stated privacy policies for their applications and charge one staff member with privacy policy management and enforcement. Such policies should coordinate with state laws, which tend to be stricter than federal requirements. Privacy concerns vary by application. For example, residents usually appreciate reminders to pay parking tickets, but e-mails about follow-up visits to a public health center can feel disturbingly invasive.
What are the lessons of all this customer diversity? Local government managers should determine the interest groups and customers that are affected by every IT application—their likely benefits, costs, and objections. Managers should not assume the person transacting the business is the only one reaping benefits or costs. The manager must ensure that a plan is developed that addresses negative concerns. How sensitive is the information and what are the privacy expectations of potential users? If a local government is new to e-government, it should first tackle problems with few conflicting interests and where customers can see a clear benefit and be supportive. It may be less cool to provide only downloadable forms—and not build a real-time permit application—but starting small conserves resources while it builds experience.
What do citizens need? E-government applications should be built first around customer needs, not government agency needs: a simple idea, but its implementation is complicated because so many customer needs cut across agencies and governments. For example, a citizen who wants to report a pothole does not care whether the road in question is maintained by the town, the county, or the state; it is the ability to report the pothole at one central Web location that is important.
Residents rarely know which agency provides which services. For business permitting, interjurisdictional cooperation alleviates complexity of navigating through jurisdictional differences. Moreover, cooperation benefits local businesses and economic development efforts by minimizing the number of applications a business must make or at least providing one-stop shopping. Laura Larimer, CIO for the state of Indiana notes, “Citizens really shouldn’t have to—and don’t want to—understand the organizational structures of how government is delivering services.… We ought … to allow them to traverse those lines without having to understand our system.”28 However, coordination across organizational boundaries can be difficult, and lack of coordination can cause serious problems.
To design a successful online application, the local government must find out whether citizens really want to complete a task online, whether they have the access and the technical skills to use the proposed application, and how homogeneous they are in their expectations and needs. Many citizens do not have convenient access to the Web, they may have poor technical capabilities, or they may simply prefer personal interaction to computer interface. These challenges are usually greater among the elderly and the poor (the digital divide is discussed beginning on page 146).
Building permits: A tale of two counties In the mid-1990s, a medium-size Florida county was one of the first to provide a sophisticated system for builders and contractors to file permits online. At a cost of almost $500,000, the application was a technical marvel for its time and generated lots of publicity at its launch. Yet, two years after its release, not a single permit had been processed through the system.
In 2000, another Florida county decided it wanted an online building permit application. Staff went to local industry association meetings and asked builders and contractors what they wanted. From those discussions, the country found the builders were far more interested in simply checking the status of filed permits than in completing them online. All parties agreed that such a limited application would be fast and cheap to build. This system has been a rousing success, and it has replaced an expensive phone-based system for checking permit status. The cost? Less than $10,000.
As of 2004, many areas provide successful online permitting systems, but timing and customer readiness are integral to success.
For example, when Santa Rosa County, Florida, decided to place a job application form on the Web, the county first investigated the nature of the existing application process. Applicants were usually current government employees, and employees commonly applied for several jobs over time. The county built a system that allows applicants to store their basic information across applications, which is a great help because more than 90 percent of an application is repeated in every submission. Applicants may change details, like home address, before new submissions. And applicants do not have to complete their forms in one online session, which is helpful when they have to find required information offline.
Jurisdictions with large non-English-speaking populations have to consider language. El Paso, Texas, for example, maintains a complete version of its Web site in Spanish.29
What about marketing? Sometimes low demand is just poor marketing; Citizens must know about a service. Complicated Web addresses are often to blame. Many local governments use Web addresses in the pattern of <www.ci.cityname. stateabbreviation.us> or <www.co.countyname.stateabbreviation.us>, but many use <.com> addresses instead. However, <.com> addresses make it difficult for citizens to tell an official government site from a commercial site. If a <.com> address is used for marketing, it should feed to an official site name that makes the legal authority clear to citizens. Fortunately, recent legal changes allow counties and cities to use <.gov>. The city of Boston used cityofboston.com for marketing but <www.ci.boston.ma.us> as well. Both addresses now take visitors to a <.gov>-style address recently made available to local governments: <www.cityofboston. gov>. For more popular services, separate Web addresses for each site are useful because they allow each to be marketed separately.
Local governments rarely have much marketing money, but budgets should not preclude cost-free marketing. Jurisdictions can plaster their Web addresses on letterhead, business cards, and utility payments and mention them on answering machines and phone support. Maybe the Web address cannot be placed on every license plate—the state of Pennsylvania does this—but publicity opportunities abound.
Human nature avoids change. Regardless of ease of use and absence of access fees, many still prefer to use walk-in services or call a live person for help. In Fairfax County, Virginia, CIO David Molchany laments that people still walk in to pay taxes instead of using the online system. Maintaining two approaches—the old-fashioned walk-in payment and the new online application—is expensive. Molchany, who hired a marketing director to promote the new, alternative kiosks and Web site, observed, “It’s surprising that people still physically come to this building to pay taxes. We’d prefer they didn’t do that. It takes a tremendous amount of resources.”30
Hiring a marketing agent may seem extreme, but the idea has merit. Some level of marketing is essential to promote online access. Media coverage can promote the service and explain why—easier, more convenient, cheaper—it is to a user’s direct benefit. Managers should be cautious about assuming the old, paper-based procedures will disappear overnight. Citizens without computer access need an alternative. This reality presents the next difficulty: customer accessibility.
Is there a digital divide in the community? Most Americans are online, but not all. For example, the city of Harrisburg, Pennsylvania, where about 32 percent of the residents are at or near the poverty line, waited until 2000 to launch its Web site. John Wright, a city council member, noted, “Cities spend a lot of money on Web sites, but a lot of urban people are never going to use them. There’s a technology gap between the well-to-do and the non-well-to-do. It’s a factor in determining how much of a Web presence you need.”31
Citizen use of local government e-services Percentage of users who say the Internet improves their interactions with local governments:
|
11% |
A lot |
|
19% |
Some |
|
18% |
Only a little |
|
48% |
Not at all |
|
Most popular activities performed at government Web sites are more informational than transactional: |
|
|
77% |
Get tourism and recreational information |
|
70% |
Research work for school |
|
63% |
Find out what services an agency provides |
|
62% |
Seek advice on a public policy or issue of interest |
|
16% |
File taxes |
|
12% |
Renew a driver’s license or auto registration |
|
7% |
Renew a professional license |
|
4% |
Get a fishing, hunting, or other recreational license |
|
2% |
Pay a fine |
|
How local government users rate the sites: |
|
|
41% |
Have visited the local government Web site; of those, |
|
62% |
Rate it excellent or good |
|
38% |
Rate it fair or poor. |
The digital divide is not only an economic division, but is also racial, generational, and educational. For business, potential customers who do not have online access are simply an untapped market. For government, access becomes a serious issue of rights and equity. Nonusers correlate with specific demographic groups, and government cannot simply disregard groups of people. If the application taps basic needs and services, it is an even more significant issue.
Should the question of access be a reason not to launch an application? In most cases, no, not as long as traditional alternatives exist and careful attention is paid to improving access. For example, when Harrisburg moved onto the Web in 2000, officials used a federal educational grant to plan government-run cybercafes (although they did not serve food) to complement existing computer centers at libraries and schools.32 Hardware and connections, however, are not enough. Access is not just about the equipment; it is also about technical knowledge. All too often, local governments launch public access computer banks and find them unused. Harrisburg, realizing this common mistake, included computer training in its cybercafes.
Training needs are partly application specific. For example, if the application targets professional activities and businesses, less training is required. If average citizens use the application (for activities such as paying a utility bill or a parking fine), the more the jurisdiction must plan for variations in background. Frequently, local governments find they must offer support, whether by phone, e-mail, or even online real-time chat, for many applications aimed at the general public.
Access issues also include the often confusing patchwork of policies and laws governing citizens with disabilities. Federal laws, such as the Americans with Disabilities Act and Section 508 of the Rehabilitation Act of 1998, are often cited as requiring IT development restrictions and accommodations. Despite these laws, government Web sites have, at best, a mixed compliance record. A 2002 Brown University study found only 27 percent of federal sites had some form of disability access, and state compliance ranged from Idaho at a poor 3 percent to Maine at 60 percent.33 Why such low numbers? Reasons include legal confusion, development costs, political desirability for fancy sites that defy accessibility, and misunderstanding of proper development, especially among contracted vendors. The reality is that the applicability of much of the cited federal legislation to local governments is murky.34 Even the often cited World Wide Web Consortium (W3C) guidelines and “Bobby-certified” rules (see http://bobby.watchfire.com/bobby/html/en/index.jsp) show clear conflicts with federal statutes. Amid confusion, concern over accessibility has launched a vast array of state policies and interpretations. The best strategy for managers is to consult with their state attorney general. Local governments should have clear, written policies driving application development.
Privacy primer: Some Web sites with advice
Electronic Privacy Information Center
Online Privacy Alliance (a corporate representative)
Source: Christopher Conte, “Getting to Know You,” Governing (May 2002): 46–50.
Disability access should not be only about avoiding litigation. Governments have a moral obligation to assist as best they can. Many jurisdictions have learned that the best approach is to offer agencies carrots, not sticks. Rather than commanding compliance to a specific standard with correlating punishments, Illinois provides training on accessible Web design; Connecticut provides this training not only to government workers but also to consultants preparing applications for the state.35 Such support alleviates two of the greatest compliance problems: development cost and understanding of proper design.
Can staff handle success? Rather than too few users, the problem may be too many. Can staff handle an increase in service demands generated by the ease of Web access? Is there a citizen complaint form on the Web? Staff must be able to respond within a day. Overdemand leads to two problems: the shift from paper-based to online forms necessitates changes in work routines for those who receive the forms and process them; and online application processes increase the total volume of service requests. An overabundance of requests is a serious problem for governments where the supply of a service is strictly limited by budget constraints. Online park reservation applications can exacerbate workload problems in what is often an already over-taxed service unit. Online requests for utility hookups can also cause problems.
Demand can sometimes be controlled by levying a convenience fee, which is a charge for using the online application compared with a free paper-based process. The downside is that, although local governments are legally justified in charging user fees to pay for operating expenses or to regulate demand, such fees meet strong political resistance, especially where citizens and political officials believe the services should pay for themselves through increases in efficiency. Fees may be more acceptable when the primary users are businesses, the service itself is new, the service is perceived as a premium, and the fee is not an economic hardship.
Agencies may refuse to develop online applications unless they are allowed to recoup the costs. Sometimes the application fees are used to support the operation of an agency function, not just the cost of the application process. The worst public relations scenario is that a local government mandates use of the Web for a basic function (such as payment of property taxes) and then charges for this privilege.
The public library of Los Angeles County offers a for-pay research service online, handling requests such as criminal background checks and construction and marketing services. The application, “For Your Information,” goes back to 1989. FYI’s regular users include about 6,000 small businesses and 60 city governments.36
Human resources, when working together with financial resources and information resources, make it possible to pay competitive wages and maintain information services that meet the needs of the community. Managed well, these resources combine to achieve community goals, improve quality of life, and increase citizen satisfaction. These accomplishments are what good government is all about. For the manager, effectiveness means paying attention to detail while keeping the big picture in mind.
Mary Todd, a county commissioner for Taylor County, is encouraging the county to begin processing all permit processes online. She wants the county to begin by handling building and construction permits online, including filings to construct new homes and businesses as well as modifications to such properties. She has read a lot of news articles about how other jurisdictions are using the Web to save money and streamline operations. She wants the service to replace all paper-based permits in two years and is certain that this will bring cost savings—mostly via employment reductions—and reduced red tape.
Although the staff finds the idea appealing, they have many concerns. First, many employees in the building inspection and permit office fear that the service is designed to eliminate their jobs. Also, the director, John Littleton, fears his department will get swamped with calls from users not able to understand the system. Other department employees worry that many permits are complicated and require a lot of interaction with the permit filer to complete. Some permits also involve obtaining related permits from state agencies, for example, when water wells may be constructed for home sites where an environmental permit from the regional water management district must accompany the county filing.
Also, the two largest cities in the county have their own building permit office, and, for some permits, filers must submit requests to both the county and city. Currently, a streamlined paper process allows builders to file with either office for both city and county permits. However, if the county goes online, this ease of filing will no longer be possible unless there is collaboration with the respective cities and their staffs. Therefore, the process could actually become more complicated for builders in city jurisdictions.
Local builders have mixed opinions about Todd’s idea. Large contractors tend to favor it, thinking the system will eliminate red tape. Small contractors think it will make it difficult to access file permits because they will have to learn the new system and then train employees to use it. They also like having county building department employees around to help them with technical details.
Budgeting is also an issue. The initial system is likely to cost at least $75,000 to construct, not counting the amount of staff time that will be required. The county already has pressing needs in what is proving to be a tight budget situation, and the budget has no slack. The $75,000 would have to come from an existing program. A couple of ideas have been proposed: one, unpopular with builders, is to pay for the conversion by increasing the current building permit fees until the new system is online; the other is to enter into an agreement with a vendor to construct it for free and give them the right to collect filing fees to recover their costs and make a reasonable return on their investment. The county’s IT office does not favor the second idea because it places critical information, some of which has significant privacy and security issues, outside the county’s direct control.
The county IT office is already understaffed and does not have the resources to build the new system. They would have to either hire new personnel or contract out the development. Once the application is developed, the building inspection employees will need significant training in its operation. They also suspect that the potential cost savings are exaggerated. Hence, they favor a test of some form and a thorough review of benefits and costs. Aware of the technology office’s reluctance to move forward, Mary Todd has accused the IT office of stonewalling and views a pilot project as just a delaying tactic.
Questions:
1 Anya Sostek, “Managing Performance: People Power,” Governing (January 2003): 54.
2 For a comprehensive text, see Siegrun Fox Freyss, ed., Human Resource Management in Local Government: An Essential Guide, 2nd ed. (Washington, D.C.: ICMA, 2004).
3 Reginald A. Shareef, “The Sad Demise of Skill-Based Pay in the Virginia Department of Transportation,” Review of Public Personnel Administration 22 (Summer 2002): 233–240.
4 Sostek, 54.
5 Faye Rice, “How to Make Diversity Pay,” Fortune 130, no. 3 (1994): 78–83.
6 P. E. Crewson and J. F. Guyot, “Sartor Resartus: A Comparative Analysis of Public and Private Sector Entrant Quality Reanalyzed,” American Journal of Political Science 41 (July 1997): 1057–1065.
7 Mary E. Guy and Seung-Bum Yang, “Conditions for Effective Self-Managed Work Teams: Lessons from the U.S. Experience,” in Central-Local Relations and Local Government Reform in Korea, ed. Byong-Joon Kim and Glen Hahn Cope (South Korea: Korea Association for Policy Studies, 2003).
8 Katherine Barrett and Richard Greene, “The Prized Employee,” Governing (May 2003): 78.
9 K. Smith, “Mobile Wins Sexual Harassment Lawsuit,” Alabama League of Municipalities (March 1995): 16–19.
10 See Appendix B for ICMA Task Force on Continuing Education and Professional Development, “Practices for Effective Local Government Management”; for a comprehensive text on financial management, see Richard Aronson and Eli Schwartz, eds., Management Policies in Local Government Finance, 5th ed. (Washington, D.C.: ICMA, 2004).
11 For a comprehensive text on financial management, see Aronson and Schwartz, eds., Management Policies in Local Government Finance, 5th ed.
12 Karl Nollenberger, original text by Sanford M. Groves and Maureen Godsey Valente, Evaluating Financial Condition: A Handbook for Local Government, 4th ed. (Washington, D.C.: ICMA, 2003). An online supplement, The IndiKit, includes interactive spreadsheets that can be used to compile information annually and prepare worksheets and graphs that help to detect trends in financial health.
13 Government Finance Officers Association, “Distinguished Budget Presentation Award (Budget Awards Program),” www.gfoa.org/services/awards.html, accessed April 6, 2003.
14 Donald C. Stone, “Administrative Management: Reflections on Origins and Accomplishments,” Public Administration Review 50 (January/February 1990): 4.
15 National Advisory Council on State and Local Budgeting (NACSLB), “Recommended Budget Practices: A Framework for Improved State and Local Government Budgeting” (Chicago, Ill.: GFOA, 1998), www.gfoa.org/services/nacslb/, accessed April 6, 2003.
16 The term municipal applies to debt issued by state and local governments generally, not solely to that issued by city governments.
17 Margaret Bowden and William Earle Klay, “Contracting for 21st Century Infrastructure,” Public Budgeting and Financial Management 8 (Fall 1996): 384–405.
18 For two out of many examples of comprehensive IT strategic plans, see the Web sites of Arvada, Colorado, http://ci.arvada.co.us/forms/51321Information%20Technology%20Strategic%20Plan%20web.pdf; and Fairfax County, Virginia, http://www.fairfaxcounty.gov/gov/dit/itplan.htm.
19 M. Jae Moon, “The Evolution of E-Government among Municipalities: Rhetoric or Real,” Public Administration Review 62 (July/August 2002): 424–444.
20 Ibid.
21 Paul Allsing, Maricopa County, Arizona, quoted in Diane Kittower, “Guide to Award-Winning Technology,” Governing (October 1999): 46–52.
22 Kenneth Kraemer, Managing Information Systems: Change and Control in Organizational Computing (San Francisco: Jossey-Bass, 1989); J. Fountain, Building the Virtual State: Information Technology and Institutional Change (Washington, D.C.: Brookings Institution, 2001).
23 Eric Welch and David H. Coursey, “Factors in Perceived Web Success among Government Information Employees,” working paper, 2003.
24 Moon, “Evolution of E-Government among Municipalities.”
25 Blake Harris, “E-Government Failures Reflect Changing Workforce Needs,” Government Technology (May 2002), www.govtech.net, accessed February 12, 2003.
26 Ellen Perlman, “The People Connection,” Governing (September 2002): 32–41.
27 Christopher Conte, “Getting to Know You,” Governing (May 2002): 46–50.
28 Ellen Perlman, “The People Connection.”
29 See www.ci.el-paso.tx.us/esp_spanish.asp.
30 Ellen Perlman, “The IT Czar of Main Street,” Governing (January 2001): 31–33.
31 Ellen Perlman, “Local Resistance,” Governing (September 2000): 54–64.
32 Ibid.
33 Tod Newcombe, “Unequal Access,” Government Technology (December 2002), www.govtech.net, accessed February 12, 2003.
34 Paul Bohman, “Section 508 Now in Effect.” WebAim, www.webaim.org/news/show_item.php?nid=11, accessed March 2003; and Newcombe, “Unequal Access.”
35 Shane Peterson, “An Inclusive Internet,” Government Technology (December 2002), www.govtech.net, accessed online February 12, 2003.
36 Shane Harris, “E-commerce at the Library,” Governing (April 2000): 56–58.