The Trump administration has drawn intense scrutiny and backlash for its proposals to restructure the Office of Personnel Management and update merit system principles, but a report published July 21 by the Senior Executives Association and Center for Organizational Excellence claims to have found a way to modernize federal personnel management in a way that is “a practical issue, not a political issue.”
“We initiated this study in response to the Trump administration’s faulty proposal to merge the Office of Personnel Management and the General Services Administration,” said Robert E. Corsi, Jr., interim president of the Senior Executives Association said at a July 28 press event on the report.
The report outlines five reasons why federal human capital management needs reform in the first place: it is more costly than the private sector; it needs to be prepared for the changing nature of work; it is no longer an inspirational employer; the system is inefficient, lacks credibility and is not future or governmentwide oriented; and the current budget, oversight and management processes put significant strain on its operability.
Benefit packages like annuities, thrift savings plans and health insurance offerings remained popular reasons for people to take and stay in federal jobs.
“We know civil service modernization is necessary, we just have to have the capacity to do it,” said Steve Goodrich, president and CEO of The Center for Organizational Excellence, on the press call, adding that proposals for human capital management change have been going on for years.
“Bold action is required to create this capacity.”
The report makes three recommendations for transforming federal human capital management, each with several action items to help get there: develop a new framework for Congress and the executive branch to work together, reform OPM and become an inspirational employer that invests in its people.
The first recommendation would create a better operating model for collaboration between the White House, Congress and OPM by establishing a select committee on the federal workforce in Congress and a working group with members from the legislative and executive branches.
That recommendation would also require leadership at OPM and the Office of Management and Budget to plan for and keep data on workforce initiatives, implementing a human capital management scorecard, similar to that of the Federal Information Technology Acquisition Reform Act, which grades major agencies twice a year on the health of their technology practices. The agencies would also need to create a plan for training and certifying human capital professionals.
The recommendation of reforming the Office of Personnel Management comes with the most action items, and likely the most potential for controversy, considering how much pushback the Trump administration’s proposal to reorganize the agency received.
Though the report encouraged Congress to wait for the legally mandated review of the proposed merger between OPM and GSA to be completed before making any decision, it also noted that a reform of the agency would be necessary whether or not such a merger takes place.
“It would make no sense to consider moving OPM without effecting a significant transformation first, so that a ‘lift and shift’ does not occur without significant strategic benefit, or to just realize a false sense of ‘job complete’ after the move. However, we do recommend moving all procurement and facilities functions to GSA (we understand facilities management has already been moved),” the report reads.
Under the report’s recommendations, OPM would be reorganized into four primary offices — the Office of Strategic Programs, the Office of Human Resource Programs, the Office of Federal Employee Benefits, and the Office of Agency Operations — while eliminating Human Resources Solutions and reengineering retirement and insurance functions to be more streamlined and user friendly, potentially reevaluating if such services would be best operated by another agency or a third party, just as the Federal Employee Dental and Vision Insurance Program is administered by BENEFEDS.
The director of OPM would also be turned into a five- or eight-year term appointment, still nominated by the president and confirmed by the Senate, while leadership of the four new offices would be drawn from the Senior Executive Service.
According to Goodrich, the agency has been without long-term leadership since 2013, inhibiting its ability to implement meaningful and long-term change. The term appointment structure would enable OPM directors to work across administrations and encourage the selection of nonpartisan nominees.
The recommendations also call for the renaming of OPM to reflect its new trajectory and enhancing the capacity of the Chief Human Capital Officers Council.
The report addresses ongoing challenges with attracting younger employees to federal service by calling on the federal government to improve operations and employee management. This includes delivering budgets that are flexible and on time — to avoid demoralizing shutdowns — and setting aside a training fund that amounts to one to two percent of federal payroll. According to Goodrich the private sector currently spends an average of 3.3 percent on training.
The proposed changes would also work to guide both low and high performers, as SEA’s Legislative Director Jason Briefel noted that a “stick-based” approach to deal with poor performers, as has been proposed by Trump administration officials, will not lead to increased efficiencies.
“Reform connotes that something is broken, that it’s unfixable,” said Briefel, adding that employees themselves do not need to be fixed, but rather the management systems that support them.
Much like other workforce reform efforts, the report calls for the end of the General Schedule, which is not designed for a modern workforce, and calls for more flexible pay banding and employee mobility across agencies.
Goodrich noted that the agency should also be focused on “creating a centralized system where OPM is using mass media, college job fairs and other job fairs for recruiting.”
The report was sent to members of Congress, the White House and election campaigns to encourage the new approach to workforce management.