Sequestration and the Federal Employee Viewpoint Survey

By on April 8, 2013 in Current Events with 51 Comments

The Budget Control Act (BCA) of 2011, which re-introduced the term “sequestration” into the budget process, reinstates the discretionary spending limits on budget authority for 2012 through 2021. Sequestration reduces government expenditures by $600 billion over 10 years, including $85 billion this year.

Since Congress did not enact alternative legislation by January 15, 2012, to reduce the deficit by at least $1.2 trillion, certain automatic spending reductions take effect beginning in 2013. The Office of Management and Budget (OMB) is required to provide a report to Congress that identifies the fiscal year cuts. This report was provided on January 18, 2012 and again on March 1, 2013.

Federal News Radio reports that House Budget Committee Chairman Paul Ryan (R-Wis.) submitted a request to the Government Accountability Office (GAO) on March 1 to examine how agencies prepared for and are implementing sequestration.  

The impacts from sequestration, the President’s signature on the Continuing Resolution that retains the $85 billion in automatic cuts, the GAO reviews of agency implementation strategies, combined with the uncertainties regarding budgets in 2014 and beyond pose unique challenges to agency leaders in sustaining the morale and productivity of the workforce. It also provides an opportunity to re-examine organizational improvement strategies.

Over the past 10 years, the Office of Personnel Management (OPM) has conducted the annual Federal Employee Viewpoint Survey (FEVS) to provide feedback to federal leaders on how well they are communicating and managing in an environment that will likely continue to be uncertain, complex and ambiguous.

Because of the unique challenges posed by sequestration, now may be a good time to revisit and re-assess the 2012 FEVS results (the 2013 FEVS results will likely not indicate a come-back year) and adopt new strategies that may result in improvements that may be reflected in the 2014 FEVS results. (The 2013 FEVS is to be administered between April 23 and June 7).

2012 FEVS Results – A Down Year or a Trend?

The 2012 FEVS was distributed to 1.6 million federal employees and received responses from 687,000 employees. Results indicate that employees believe their work is important, look for ways to improve, and are dedicated in putting in extra effort to get the job done.  

Results also indicate that the policies and systems that provide the support that employees need to sustain their commitment to high performance and quality work are inadequate. For example, only two out of 10 employees feel pay raises are related to their job performance and only three out of 10 employees feel that their performance is recognized in a meaningful way and that promotions are based on merit.

Other key conclusions from the FEVS include the following:

  • “Overall, the steady trend of improvement has changed; government wide scores have dropped on every index, and 36 items decreased between two and five percentage points from 2011 to 2012.”

Appendix D of the FEVS report analyzed trends by applying generally accepted techniques for determining “statistical significance.” Up and down arrows are used to indicate increases and decreases, respectively, and a horizontal arrow indicates no change. Significant trends are provided for the periods of 2008-2010, 2010-2011, and 2011-2012.

An additional summary and analysis of the survey results is provided by the Partnership for Public Service’s The Best Places to Work in the Federal Government 2012 Rankings. The rankings include trends of data from 2003, 2005, 2007, 2009, 2010, and 2011. Rankings allow organizational leaders to compare the results of their respective leadership competencies with the results achieved by leaders of other federal organizations. 

When to Act and When to Leave Things Alone

Typically, the common reaction to these types of surveys is to challenge management to address areas receiving low scores by forming teams and implementing solutions. OPM guidance states:

“A complete review of results will take place in every agency, and effective action planning is more important than ever. Federal leadership must focus on renewing and re-energizing their workforce.”

Dr. W. Edwards Deming, whose contributions and insights on managing variability were recognized by the editors of FORTUNE magazine as among the great contributions in business history, estimated that the majority (95%) of traditional approaches, such as “effective action planning,” resulted in no improvement. For example, how often have past actions to improve survey results within your organization resulted in sustained improvement?

Deming reinforced the two types of mistakes that can be made in response to change:    

  • Mistake 1. Taking action on a stable process when nothing out of the ordinary has occurred and there is no desire or commitment to change.
  • Mistake 2. Not taking action when something out of the ordinary has or may have occurred.

Sequestration would fall into the Mistake 2 category. If it is repealed, it represents a temporary change. If the cuts to budgets are sustained, it represents a change in the system. Many of the actions that are taken in response to survey findings that do not result in a permanent and fundamental change would fall under the Mistake 1 category.

Deming remarked that avoiding mistake 1 or 2 is impossible. The aim is to regulate the frequency of the two mistakes to minimize adverse effects, including economic loss.    

An Alternate Strategy – Understanding Variability and “Significance”

Statistical significance represented by the up and down arrows in Appendix D of the FEVS report is not synonymous with system or process significance. For example, if you have been generally getting to work about the same time every day for the past few months, you could conclude you have predictable commuting process. You would also have a good idea of the normal range of time it takes you to get to work. 

It is highly likely that an analysis of your daily commuting time would include one or more days where the time could be assessed as “statistically significant” compared to the “norm.” It is also likely that you probably would not have even noticed that it may have taken you a little longer on that particular day that was determined to be statistically significant.

In my February 2012 article “Managing Variability in Thrift Savings Plans,” I provided trend data on the results of the C Fund from 1988-2011 and applied one of the accepted standards for interpreting trends, which I refer to as the rule of 7. A colleague who is skilled in statistical analysis reviewed the trend data on the C Fund and determined that the return of -36.99 in 2008 was statistically significant.

Applying the methods developed by Dr. Walter Shewhart and expanded on by Deming, the 2008 return was not significant from a system or process perspective—in other words, it was due to common cause variation and not special cause variation. Note that “doing nothing” in 2008 while continuing to invest in the C Fund would have been proven to be a good decision.   

Having seven data points to determine process significance provides a 99% probability that something in the system or process has changed. If you use just four data points, there is a 90% probability that something significant happened. If you use just one data point, you have a 50% probability that a significant event occurred.

Put another way, making a decision based on one data point is like predicting the result of a coin toss—you have a 50/50 chance of being right. However, if you flipped the coin and got either seven heads or seven tails in a row, most people would notice and conclude that the result is significant.

Having more data to assess the effects of change is always best, but what if you can’t get more data? A reasoned judgment can be derived from talking with people who have years of experience working in the respective system or process. Similar to an individual’s commuting process, they can typically describe how the process has performed over time, the cycles, what’s changed, what hasn’t changed, what’s normal and what is not.    

A Way Ahead

The future operating environment for federal agencies will continue to be uncertain, complex and ambiguous.    

Understanding variation is critical in determining when to act, the type of action needed and when to leave things alone.

If you are considering taking action to address the concerns raised by the results of the FEVS, you should start with an assessment to determine if the results are due to a common or special cause. Tap into the wisdom of the people who have experience with the respective system, policy or process. Ask them to share their experience and provide their insight on what might be considered normal as opposed to unusual or special.

The Best Places to Work in the Federal Government 2012 Rankingsincludes the results of seven years of survey data, including trend charts of index scores. Develop a trend chart of the data for your organization, add the average line, look at the high and low and average scores and look for any outliers. Look at similar trends for other organizations. Compare your assessment with the trends provided in Appendix D of the FEVS report. More data is always better and is needed for identifying common and special cause variation.   

Finally, for those readers who have been following my series of articles, you won’t be too surprised when I recommend that organizations voluntarily adopt the Baldrige Criteria for Performance Excellence as their strategy for introducing and sustaining a needed system perspective. It is a proven framework that, over time, can lead to the level of performance American citizens will always expect from federal employees.

© 2016 Timothy J. Clark. All rights reserved. This article may not be reproduced without express written consent from Timothy J. Clark.

About the Author

Timothy J. Clark, is the author of Success Through Quality, Support Guide for the Journey to Continuous Improvement. He retired from the federal government with over 30 years of service. He is also a former enlisted soldier in the U.S. Army and retired at the rank of Colonel with over 30 years of combined service in the U.S Army National Guard and Army Reserve.

He is currently the Director of the Deming Application Network that supports leaders in transitioning to the application of better methods that will immediately result in higher levels of performance.

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