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Memo - 2007-2008 Goals & ObjectivesADMINISTRATIVE SERVICES: OFFICE OF THE CITY MANAGER MEMORANDUM T0: Honorable Mayor and Members of the ity C uncil FROM: Rick Getschow, Hopkins City Manager MEETING DATE: March 11, 2008 SUBJECT: 2007-2008 Goals and Objectives Background: The City Council approved its 2007-2008 Goals and Action Plan in 2007. At this strategic planning work session, we should be prepared to revisit these goals and action steps and to begin discussing the next potential set of goals and action steps. The object of the meeting will be to discuss accomplishments achieved in each goal area in the past year and then discuss any new future goals that may need to be added. This will allow City Council and city staff the opportunity to discuss any initiatives that they feel is important and should be placed in a future goals document. Included in the packet is: • The City of Hopkins 2007-2008 Goals and Action Plan • Performance Accountability Article- Executive Summary, Introduction, and Chapter 1; Clear, Measurable Goals. City of Hopkins zoos-zoos Goals and Action Plan 2007-2008 City of Hopkins Goals And Action Steps Goal I - To Improve Communications and Marketing Efforts to Residents, Developers and Businesses Action 1 Think Hopkins-Implement the City-wide Branding and Marketing Campaign as a partnership with the HBCA and Hopkins Marketing Committee Action 2 City Website: 2001 Redesign planned. Explore more E- Governmentcapabilities. Action 3 Monthly Newsletter- Hopkins Highlights: Continue to be awell-received publication delivered to every household Action 4 Collaboration with the official city newspaper (Sun*Sailor)- regular city columns Action 5 Enhance the promotion of city events (Raspberry Festival, Mainstreet Days, and Heritage Celebration) Action 6 Conduct aCity-Wide survey Action 7 Produce a Printed City Annual Report Action 8 Implement "Action Center" customer service/complaint tracking software Action 9 Continue conducting Annual Citizen Academies and Alumni Events Action 10 Comprehensive Plan Update/Revision as a Community Building Tool Action 11 Research the Construction of a Message Board at the Hopkins Pavilion 2007-2008 City of Hopkins Goals And Action Steps Goal II -Provide and Nurture Growth of Employees and the City Council Action 1 City Council and Board/Commission Orientation Action 2 Explore a City Council TraininglFeedback system Action 3 Research conducting acity-wide Volunteer and Board recognition event Action 4 Monitor the new employee evaluation system Action 5 Initiate an Employee Academy Action 6 Reinvigorate the Tuition Reimbursement program Action 7 Implement aCity-wide employee training program 2007-2008 City of Hopkins Goals And Action Steps Goal III -Enhance the Budget Process and Increase the Education and Understanding of City Finances Action 1 Continue with a new budget process whereby department presentations and work sessions are begun after department budgets are submitted and evaluated Action 2 Conduct a detailed analysis of all city fees Action 3 Research the Possibility of Conducting a Budget "Boot Camp" Action 4 Entire Newsletter devoted to the budget Action 5 Feature Newspaper article on the budget Action 6 Restart and/or Reinvigorate the Bricks and Benches Programs 2007-2008 City of Hopkins Goals And Action Steps Goal IV -Improve the Quality of Life in Hopkins Facilitate Redevelopmentthroughoutthe City Action 1 Downtown Luther property: Work with a developer on a mixed use redevelopment Action 2 Block 64: Work with a developer on a mixed use redevelopment project Action 3 Excelsior Crossings: Coordinate efforts to conduct redevelopment on the site with Opus Northwest, LLC (Office Project) Action 4 Shady Oak Road: Coordinate efforts with Hennepin County and the City of Minnetonka to implement a plan or the future redevelopment along the Shady Oak Road Corridor Action 5 Hopkins Dodge Site: Work with potential developer on a redevelopment of this site. Action 6 East End Study Implementation 2007-2008 City of Hopkins Goals And Action Steps Goal IV -Improve the Quality of Life in Hopkins Action 7 Continue with the Nurturing Our Retired Citizens (NORC) Project Action 8 Implement a Hopkins Police Chaplaincy Program Action 9 Pursue an upgraded and enhanced Code Enforcement and Rental Licensing Program Action 10 Continue with the Blake Road Corridor Initiatives Action 11 Sanitary Sewer Inflow and Infiltration Program Action 12 Partnership with the Minnesota Pollution Control Agency (MPCA) for Remediation of the Hopkins Closed Landfill Action 13 Partnership with the Three Rivers Park District for the planned Depot Improvements Action 14 Enhancement of the City/Regional Trail System (Signage) Action 15 Research City/Regional Transportation System (Hop-a- Ride, Met Transit) to be assured it is meeting resident needs. Action 16 Research Downtown Safety Enhancements (Improved Lighting, Ramp Cameras) Action 17 Neighborhood Park Initiative. Park Board will partner with neighborhoods and neighborhood associations regarding the improvement and enhancement of neighborhood parks 2007-2008 City of Hopkins Goals And Action Steps Goal V-Provide and Nurture Citizen Growth and Development Action 1 Neighborhood Association Growth and Development. Research methods to enhance and promote city neighborhood associations. Possibilities include potentially providing training and technical assistance. Action 2 Research the implementation of a Citizen Emergency Response Team (CERT) Program Action 3 Strengthen efforts to involve residents from minority populations in City activities/issues (Blake Corridor, Human Rights Commission) Action 4 Research methods to increase city volunteerism 2007-2008 City of Hopkins Goals And Action Steps Goal VI -Meet with groupslorganizations to talk about mutual areas of interest Action 1 Meeting with the Neighborhood Association Presidents/Representatives Action 2 Faith Community Network Action 3 Meeting with the Hopkins School District and School Board Action 4 Meeting with Legislative representatives (Establish a legislative platform/agenda) Action 5 Meeting with HAMA (Hopkins Apartment Managers Association) Action 6 Meeting with the Business Community (HBCA) Action 7 Meeting with Metropolitan Council Representatives Action 8 Meeting with Hennepin County Commissioners Action 9 Meeting with City Service Clubs Action 10 Meeting with the City of Edina Council (U.S. Women's Open 2008, Recreation Programs) Action 11 Meeting with the City of St. Louis Park Council Action 12 Meetings with the City of Minnetonka Council (Shady Oak Road) I % ~. MANAGING FOR PERFORMANCE AND RESULTS SERIES Performance Accountability: The Five Building Blocks and Six Essential Practices Shelley H. Metzenbaum Visiting Professor School of Public Policy University of Maryland __ IBM Center for __ '_ The Business of Government Governments around the world are increasingly adopting goals and measures as a way to improve societal outcomes and enhance accountability. To improve societal outcomes, governments seek to "grow the good"-the health, safety, well-being, and general quality of life. At the same time, they aim to "slow the bad"-harmful or unhealthy events, risk-raising causal factors, unnecessary costs, wasted time, fraud, corruption, and incivility. To strengthen government accountability, govern- ments seek to meet four distinct categories of accountability expectations: fiscal, ethical, democratic, and performance. Four Categories of Accountability Fiscal accountability: Government spends its money as authorized, with as little waste as possible. Ethical accountability: Government agencies operate honestly, without conflict of interest, self-dealing, other forms of fraud, or abuse of the power of governmental authority. Democratic accountability: Government agencies do what their citizens want and need, engaging citi- zens and their elected representatives in under- standing trade-offs and making well-informed choices among competing priorities. Government agencies treat people civilly and courteously, unless there are strong justifications not to, so people do not resent or resist government because it has ailed in a rude, slow, or inappropriate manner. Performance accountability: Government agencies and their employees 4vork intelligently and diligently to deliver effective and cost-efficient government programs. Experience has shown that goals and measures can be remarkably effective performance-driving, accountability-enhancing tools. But experience has also shown that they can provoke self-protective responses that interfere with performance and accountability gains: timid targets, measurement manipulation, measurement elimination, outcome avoidance (resulting in an affinity for output targets), and claim games where some rush to claim credit for accomplishments while others run from it, fearful of provoking resentment among their peers. These performance-dampening responses most often arise when goals and measures are explicitly linked to externally provided (extrinsic) incentives, whether positive incentives in the form of rewards or negative ones in the form of penalties or poor public scores. When incentives are inappropriately linked to measurement of performance results or the wrong kinds of incentives are chosen, performance management systems tend to backfire, discouraging workers and even motivating them to cheat. Indeed, an overwhelming body of research and experience suggests that promising rewards to individuals in government agencies seldom works when the rewards are linked to attainment of specific targets, progress relative to peers, progress relative to the past, or per unit of product. Somewhat surprisingly, in most cases government should resist the temptation to offer explicit rewards to individual employees for meeting or even making progress toward specific targets, except when employees are free to opt in and opt out of contests to attain new performance levels without fear of penalty or embarrassment for non-participation. IBM Center forThe Business of Government ~'' ~°' ~~. ~~.,~~ ;~.,,,, ~~; ", PERFORMANCE ACCOUNTABILITY Similar caution needs to be exercised when using performance incentives for organizations. Extrinsic incentives can work, but they can also backfire, depressing both performance and accountability. They can rob goals and measures of their ability to stimulate the kind of effort and innovation that results in continual, sometimes dramatic, improve- ments insocietal conditions, And, they easily provoke unproductive fear that interferes with improvement efforts, especially when accountability expectations are left vague. This is not to suggest that organizations, their managers, and those who work for them should not set goals or measure progress toward the goals. Quite the contrary! Goals and measures are among the most important tools public sector organiza- tions can use to enhance both performance and accountability. What it does suggest is that less attention should be paid to incentives and far more to ensuring the active and effective use ofoutcome-focused goals and measures. Instincts to link rewards (and penalties) explicitly to goal attainment or compar- ative standing, whether through performance-based pay, budgets, or other extrinsic bounty, should be resisted. Linking rewards and penalties to goal attainment is not only an ineffective motivator but also an unfair and infuriating one when individuals or organizations lack the skills, resources, or authority to meet (or make progress toward) their targets and the means to secure those inputs. Indeed, some missed targets are inevitable in healthy, discovery-provoking, risk-tolerating enter- prises. If individuals and organizations met all of their targets all the time, it would suggest that they had chosen timid targets and missed the performance-driving power of a stretch target. What it also suggests is a need for public organiza- tions toclarify accountability expectations both with those being held accountable and with those holding them to account, including supervisors, legislators, budget offices, grant-giving organiza- tions, delivery partners, and the public. Specifically, public organizations and their managers should be held accountable for six essential practices: • Emphasizing outcomes, using specific targets • Measurement mastery • Delivering feedback • Assuring an ongoing venue for interactive inquiry • Cogent strategies • Implementation To achieve both accountability and performance gains, public organizations and their managers need to tap the power and respect the limits of the five basic building blocks of performance management: • Clear, measurable goals • Measurement to motivate, illuminate, and communicate • Verbal feedback to unleash the power of goals and measures • Interactive inquiry • Cautious use of externally provided incentives The first four of the six essential practices charac- terize how the first four of the five basic building blocks should be used. The fifth and sixth essential practices, cogent strategies and implementation, are critical to converting the first four practices into improved societal outcomes. Cogent strategies and implementation can also include the use of the fifth building block, incen- tives. Great caution must be exercised, however, when extrinsic incentives are employed as part of an implementation strategy lest they drive out intrinsic motivators. It is often preferable to let goals, measures, feedback, and interactive inquiry work on their own to drive performance goals without burdening them with explicit links to the promise of reward or the threat of penalty. The Five Building Blocks of Performance Accountability Clear, Measurable Goals Goals motivate and drive performance improvement because they focus, energize, encourage persistence, and stimulate discovery not only for individuals but also for organizations. They have this effect ~vww.busi nessofgovernment.org I'FRFORMANCE ACCOUNTABILITY even without an explicit link to incentives. To drive significant performance gains, goals need to be specific and challenging. To improve societal outcomes, goals also need to be outcome focused wherever possible, except in instances where resources or skills are inadequate to meet the goal, in which case near-term learning and capacity- building goals are appropriate. Where the positive effect of agency activities on outcomes has been clearly established, short-term output targets can be established but should be accompanied by longer-term outcome goals. A few specific goals should be challenging. At the same time, it can be helpful to set other targets to communicate areas where continual progress is sought, steady state is acceptable, and slippage will be tolerated. Group goals should be set when cooperation is needed. Goals do not need to be linked to incentives to be effective. They do, however, need to used, which is why feedback is so essential. Also, goals work best if used in a constructive, not a critical, manner. Those holding government to account should expect government agencies to adopt specific targets that make clear to the public what government is trying to do (including adoption of a few stretch goals that are challenging but realistic) and what it is not trying to do. They should not blame or penalize agencies for missed targets, provided experience-informed, cogent strategies have been developed and implemented to meet the goals. Measurement to Motivate, Illuminate, and Communicate Measurement motivates, illuminates, communicates, and informs choice. Even without an incentive, measurement motivates both organizations and people because people enjoy a sense of accom- plishmentand take pride in a job well done. Measurement illuminates by identifying those with better performance who provide a path forward for those wise enough to learn from the experience of others. Measurement communicates what works and what doesn't, speeding both the uptake of effective practices and the discard of ineffective ones. Measurement also informs both electoral and consumption choices, serving as a shorthand language facilitating communication between government and both its citizens and consumers of government services. Studying measurement patterns, changes, anomalies, and relationships reveals problems needing attention and program successes worthy of replication. Many useful measurements are not indicators of agency performance, per se. They simply serve to trigger focused follow-up questions that lead to the detection of the underlying causes of problems and progress. Unfortunately, measurement is often primarily used to answer the compliance-oriented question: "Did an agency or program meet its target?" It is far more constructive and effective when measurement is used primarily to answer performance-improving questions, such as: "What works and is worth replicating?" and "What does not, that needs attention?" Verbal Feedback to Unleash the Power of Goals and Measures Essential to effective performance management is not only quantitative feedback in the form of measurement but also verbal feedback. Well- delivered verbal feedback boosts confidence that a goal can be met, stimulates ideas and specific plans about how to meet it, and reinforces the importance of specific goals. Interactive Inquiry When cooperation among many parties is needed to meet a goal or when relevant expertise exists outside an organizational unit, a forum that facili- tatesfrequent interactive inquiry enriches the performance-improving power of goals and measures. These meetings provide an efficient and effective forum for easing cross-organizational cooperatian, delivering feedback when more than one person has information relevant to goal attainment, and obtaining quick answers and advice from managers, peers, and others in the organization. For these meetings to work, without deteriorating into show-and-tell sessions or stifling open and honest assessments, they should lead with questions and not with answers, avoid blame, and push for better understanding of conditions and causes, as well as specific action plans. Cautious Use of Externally Provided Incentives Extrinsic incentives in the form of externally promised rewards and threatened penalties can motivate, but they can also discourage and IBM Center for The Business of Government PEREORMANCE ACCOUNTABILITY introduce unhealthy fears that compromise discoveries that lead to performance gains. Therefore, extrinsic incentives should be used only in a limited number of circumstances and applied with great care. A reluctant approach to the use of extrinsic incentives is advisable especially for individuals but also for organizations. The Six Essential Practices for Improving Performance and Strengthening Accountability The enormous potential problems that can arise when extrinsic incentives are inappropriately used underscore the importance of clarifying performance accountability expectations. Even when incentives are not explicitly linked to goal attainment or relative performance, problems often arise because those being measured fear such links will eventually be made. To use goals and measures in a way that improves societal results and strengthens democratic accountability, what is therefore needed in every public organization is a clear articulation and understanding of performance accountability expectations. Specifically, government organiza- tionsand their managers should be held accountable for six essential practices: Emphasizing outcomes, using specific targets: using specific outcome-focused goals or targets, a few of which are challenging; establishing specific targets when they have not been externally set; and communicating targets to the public. Measurement mastery: using measurements to gauge progress toward the targets; commu- nicating measurements to those who can influence progress as well as to the public; and discovering what the measurements reveal by organizing and studying them to look for patterns, anomalies, changes, and relationships in the search for what works, what does not, causal connections, and areas where more understanding is needed. Delivering feedback: helping others in the organization to set outcome-focused targets (including a few ambitious ones), to believe in their own abilities to reach specific targets, to find specific ideas and practices that enable them to reach the targets, and to obtain needed skills, resources, and authority to meet targets or revise them to account for implementation obstacles. Assuring an ongoing venue for interactive inquiry: ensuring the existence of a venue that regularly engages others with expertise and resources relevant to the attainment of specific targets in providing feedback, stimulating syner- gisticthinking, sharing experience, planning and coordinating actions, assessing implementation efforts, and updating targets and action plans based on the best available evidence. • Cogent strategies: developing cogent long-term strategies and shorter-term action plans based on the best available evidence and ideas. • Implementation: implementing strategic and action plans and ensuring that insights from experience are fed back into the development of targets, strategies, and activity selection on a timely basis. Will this prescription for performance management accountability expectations, informed by research findings, work in practice? Evidence from numerous government agencies suggest it can not only work, but it can work in a powerful way with great outcome and accountability returns. It is evolving in New York City, Baltimore, the state of Washington, the educational system in Tennessee, numerous United States federal agencies, and in the United Kingdom and New Zealand. There are promising developments on the political front, as well. A small but increasing number of elected executives-for example, the mayors of Baltimore, Washington, D.C., and New York City- have boldly announced specific outcome-focused targets with deadlines, openly reported on progress and problems, and won re-election despite missed targets. And while most legislative decision makers at the federal level have ignored formal documents related to the Government Performance and Results Act (GPRA) and the Program Assessment Rating Tool (PART), many have in fact paid attention to agency goals and outcome measures when goals and measures are delivered in a format that is relevant to them. What is needed is a performance management approach that is outcome focused, measurement ~vtvw.busi nessofgovernment.org PERFURMANCF ACCUUNTABILnY PART' and Performance Accountability Expectations The Program Assessment Rating Tool (PART) of the U.S. Office of Management and Budget appropriately gives federal agencies credit for many of the practices recommended here, including setting specific and challenging goals, emphasizing outcomes, and mastering measurement. Two aspects of the PART should he revised, however, to lessen the likelihood of dysfunctional agency responses: • OMB should not score programs low for not meeting targets when programs have set chal- lenging, outcome-focused targets, measured progress, and implemented what seemed like a sensible strategy at the time the target was set. • OMB should not score programs low for not meeting targets they cannot control because of legislative barriers, even when an agency has proposed corrective legislation to the White House. rich, and inquisitive but not punitive. When agencies adopt the six essential practices described here, outcomes improve and accountability increases. Outcomes rise because goals focus and motivate, measurement reveals what works and what doesn't, and feedback and interactive inquiry inspire, inform, and engage. Accountability (and democracy) increase because public articulation of specific goals clarifies what each organization will do and what it will not do, allowing citizens and their elected representatives to determine if the organization is doing what they want it to do and inviting them to use their electoral and adminis- trative process voices to respond if they disagree. Outcomes and accountability also rise because goals, measurement, strategy transparency, and interactive inquiry encourage intelligent, honest, and diligent efforts. ~ o I IBM Center far The Business of Government ~- PERFORMANCE ACCOUNTABILITY Introduction Governments in the United States and all over the world have adopted laws and directives requiring agencies to set goals and measure performance. These directives have at least two purposes. They seek to improve societal outcomes-growing the good (health, safety, well-being, and general quality of life) while slowing the bad (harmful or unhealthy events, risk-raising causal factors, unnecessary costs, wasted time, fraud, corruption, and incivility). They also seek to strengthen government accountability. There is general agreement about what it means to improve societal outcomes, although differences in values and factual uncertainty often spur debate about what constitutes a better outcome. In contrast, a general notion of what it means to improve accountability is less well understood. What Is Accountability? What exactly is this concept of accountability? What does it mean to "hold someone accountable"? What does it mean for government agencies and employees to be answerable to someone and for what and to whom do they need to account? Presumably, it means in part the desire of citizens and their elected officials to be able to identify who is responsible for an organization's outputs or outcomes and for its successes and failures. But then what? When people talk about holding someone or some organization accountable, what happens? One public management expert has proffered a somewhat tongue-in-cheek answer: know of no definitive answer, either theoretical or empirical. But I bet I know what the managers who are to be held accountable think. I bet they believe, from their own empirical experience, that "holding people accountable" means that they when they fail they are punished and that when they succeed nothing significant happens.' Unclear accountability expectations-who is account- able to whom for what and what consequences arise when accountability expectations are not met- are problematic because they introduce fear into performance management, which is the use of goals and measures to manage. That fear, in turn, creates problems such as measurement manipulation, timid targets, outcome avoidance (resulting in an affinity for output targets), and claim games where some rush to claim credit far accomplishments while others run from it, fearful of provoking resentment among their peers. Occasionally, measurement systems even implode, seemingly overburdened by their own weight. These problems arise for three primary reasons: vague accountability expectations, inadequate feedback and inquiry to probe the insights revealed by performance measures, and misguided notions of how and when to use incentives. Past experience and research suggests that many of these problems can be averted, performance improved, and accountability strengthened, but only if agencies and their watchdogs adopt an inquisitive, non- punitive approach to performance management. Goals and measures are among the most powerful pe or-`"~--' In an -enha ing too s government has at its disposal. Even without an explicit link to incentives, g llsoa and measures drive behavioral change both in individuals and in organizations. Goals do this by serving as a focusing point and by influencing attitudes, effort, and www.businessofgovernment.org ~ 11 PERFORMANCE ACCOUNTABILITY creativity. Measures do this by reinforcing goals, by guiding the search for more effective intervention approaches, and by informing choices. Goals and measures cannot serve this powerful ' function, however, unless used in an atmosphere not overwhelmed by fear of penalties or even unfair rewards. Such an atmosphere necessitates an attitude change in the way government uses goals and . measures--one that is active, not passive; one that is constructive, not critical; one that recognizes goals and measures as a robust resource, not simply an obligation to be generated in response to mandates for performance plans and reports. When goals and measures are simply placed on paper but never used, they are useless. Feedback is essential to unleashing their power. Feedback can be useful when provided one-on-one or delivered collectively. When delivered in a way that stimulates ongoing exploration of measurement implications among those with expertise and the potential to contribute to outcome gains, it illuminates, invigorates, enlists, and ultimately improves societal outcomes. The necessary attitude change starts with questions such as: "What is working and merits replication?" and "What is not working that needs attention?" These questions contrast starkly with the initial question more frequently asked by agency leaders and influential observers such as budget analysts and appropriators: "Did you make your target?" The instinct to hold people and organizations accountable for meeting a target is strong, among both practitioners and academics. In 2001, for example, congressional appropriators cut bonuses for tl~e National Highway Traffic Safety Administration when it failed to meet some of its goals and threatened to cut bonuses for the Federal Aviation Administration (FAA) and the Internal Revenue Service. Even leading public management experts suggest that bonuses should be withheld when targets are not met: If agencies give top managers bonuses even when they don't meet GPRA targets, they are saying that other goals are more important than GPRA. With these decisions, the appropriations (panel] is saying otherwise- that GPRA is a key measure of agency success, and there will be no bonuses for managers that fail to meet GPRA targets.' Goals and Targets The terms goals and targets are used interchange- ably inthis report. Goals are sometimes seen as more general and targets as more specific. That dis- tinction is not used consistently or rigorously here, in part because that distinction does not consis- tently appear in the English language and because those seeking to establish a common nomenclature for performance management (for example, the Governmental Accounting Standards Board), do not make that distinction. Individual organizations may want to agree on a common terminology, but the objective inthis report is to get key concepts across, not to force a precision of language. For goals and measures to realize their performance- improving, accountability-enhancing potential, though, neither individuals nor government organi- zationsshould be help strictly accountable for meeting all targets. What is needed instead is a performance management system that anticipates missed targets and occasional performance slippage. What is needed is a system that recognizes that missed targets arise when programs set the sort of ambitious targets that most effectively motivate performance gain and that factors beyond an agency's control sometimes drive performance downward. This kind of approach can sustain a high level of accountability despite its tolerance for missed targets. It does this not by holding managers and their organizations accountable for target attainment or even for steady performance climbs, but by con- tinually holding them accountable for six essential performance management practices: • A relentless focus on improving outcomes with clear, outcome-focused targets, a few of which are challenging • Measurement mastery • Frequent feedback • Interactive and ongoing inquiry to find what works and what doesn't • Cogent strategies and action plans • Implementation When agencies adopt this sort of inquisitive, non- punitiveapproach to performance management, 12 I IBM Cenler forThe Business of Government PERFORMANCE ACCOUNTABILITY Accountability Expectations A statement attributed to former New York City Police Department Commissioner Bill Bratton cap- tures this notion of accountability expectations: "No one ever got in trouble if the crime race went up. They got in trouble if they did not know why it had gone up and did not have a plan for dealing with it" outcomes improve, accoun a I ity rises, and democ- racy is strengthened. Organization of This Report This report explores and explains how agencies should use goals and measures to engage the intelligence, interest, and commitment of those in government, not terrify or discourage them. The report identifies five building blocks integral to sustainable, effective, accountable performance management: • Clear, measurable goals • Measurement to motivate, illuminate, and communicate • Verbal feedback to unleash the power of goals and measures • Interactive inquiry • Cautious use of externally provided incentives The report explores what theory and experience sug- gestabout the best ways to use these five building blocks, distinguishing between practices likely to advance outcomes and accountability and those more likely to trigger performance-dampening, dysfunctional behavior. This report offers a new notion of performance accountability, one that is inquisitive and expects persistent questioning to find program successes worth replicating and program and societal failures needing attention. It is an account- ability that leads with goal clarity, information, and analysis-and that encourages with insights and the opportunity to make a difference. It is also a non- punitive accountability, employing sanctions only in limited circumstances and as a last resort, recogniz- ingthat penalties and even rewards often do not affect motivation in the ways intended. When goals are specified inaccurately, the wrong kinds of incen- tives chosen, or incentives inappropriately linked to who and what is measured, the motivational intent of incentives tends to backfire. Extrinsic incentives can discourage workers and even prompt cheating. n limited circumstances, inducements, penalties, nd rewards can strengthen the performance-driving, ccountability-enhancing effect of goals and mea- ures. It is often preferable, however, to let goals and measures work on their own without an explicit link to incentives, relying instead on intensified attention to feedback and interactive inquiry. Before examining the five building blocks more carefully, the report begins with a brief discussion of the oft-stated but seldom-defined term "account- ability" to clarify assumptions used in the report regarding accountability expectations. Changing Expectations of Accountability In 2004, the comptroller of what was then the U.S. General Accounting Office (GAO) changed the organization's name to the Government Accountability Office. The name change captured evolving account- abilityexpectations taking place in governments across the United States and the world, expectations that include "better performance" and "strengthened democracy" along with fiscal and ethical integrity. Historically, U.S. accountability laws, rules, and policies have focused on fiscal and ethical account- ability, following the trail of government money to prevent "the politics of personal favoritism and gain from meddling in the administrative decisions about personnel, procurement, finance, and service delivery."4 In changing the name, U.S. Comptroller General David Walker sought to emphasize a shift in organizational emphasis from fiscal and ethical issues to performance and democratic ones: After 83 years, the General Accounting Office has changed its name to the Government Accountability Office. Some might wonder why GAO felt a need to tinker with an institutional identity so strongly associated with government economy, efficiency, and effectiveness. But our old name, as familiar and reassuring as it was, had not kept pace with GAO's evolving role in government, The truth is that "accounting" has never been our chief mission. ~vtvw.businessofgovernment.org ~ 13 PERFORMANCE ACCOUNTABILITY Stereotypes, however, can be hard to shake. Some college students we were trying to recruit mistakenly assumed that you needed an accounting degree to work at GAO. New members of Congress, cabinet-level officials, and prominent journalists have, because of our name, thought that GAO's main job was to keep the government's books. In fact, a recent crossword puzzle in the Washington Post asked for athree-letter term describing a GAO employee; the answer was "CPA."5 Acknowledging that "GAO primarily scrutinized government vouchers and receipts in its early years," Walker observed that by the millennium, fiscal audits constituted only about 15 percent of the GAO workload. The name charige at GAO was intended to reflect a shift that had already occurred, one focused on how effective government agencies were in running programs (performance accountability) and whether government programs addressed the needs of society (democratic accountability): Today, most GAO blue-cover reports go beyond the question of whether federal funds are being spent appropriately to ask whether federal programs and policies are meeting their objectives and the needs of society. GAO looks at the results that departments and agencies are getting with the taxpayer dollars they receive.' That is not to suggest that performance and democratic accountability substitute for fiscal and ethical accountability. Instead, new accountability expectations have been added to the existing ones. The transition captured by GAO's name change suggests that four distinct accountability expecta- tionscurrently exist for modern government agencies in democratic systems: • Fiscal accountability: Government agencies will spend money as authorized, with as little waste and as efficiently as possible. • Ethical accountability: Government agencies will operate without conflict of interest, self- dealing, other forms of fraud, or abuse of the power of governmental authority. Democratic accountability: Government agencies will do what its citizens want and need, engaging citizens and their elected representatives in understanding trade-offs and making well-informed choices among competing priorities. Government agencies will also treat people civilly and courteously, unless there are strong justifications not to, so that people do not resent or resist government because it has acted in a rude, slow, or inappropriate manner. • Performance accountability: Government agencies and their employees will work intelli- gentlyand diligently to deliver effective and cost-effective government programs. These four distinct accountability expectations are the ones used in this report to explore how agencies can use goals and measures to improve outcomes . and enhance accountability. ~ 4 ~ IBM Center for The Business of Government PERFORMANCE ACCOUNTABILITY Building Block 1: Clear, Measurable Goals V Goals, cognitive scientists have confirmed, play a remarkably powerful, performance-driving function. President John F. Kennedy intuitively understood this when he invited the nation in 1961 to accept the goal of putting a man on the moon in a decade: "I believe that this nation should commit itself to achieving the goal, before this decade is out, of landing a man on the moon and returning him safely to the earth."~ Kennedy did not threaten penalties, nor did he promise incentives when announcing this ambitious objective. Still, by proposing the goal and asking Congress to fund it, he inspired and challenged the nation to meet it. Sim I stated oats focus, energize, encoura e persistence, and stimulate iscov~. etting a goal 'releases a remarkable Intrmslc motivational force in people. Researchers have determined that goals affect performance through four mechanisms: a directive function, an energizing function, persistence, and indirectly by leading to the arousal, discovery, and/or use of task-relevant knowledge and strategies. This finding has been demonstrated in numerous and repeated experiments across countries and even in work with brain-damaged patients.10 Goals function this way not only for individuals but also for organizations. Whether set by an executive, a legislative body, or the people of the organization, goals also drive performance improvement in groups." It is often suggested that goals are more effective performance drivers when the team, group, or organi- zationpicks its own goals. In fact, group goal setting is not a necessity and in some cases can be a costly enterprise. Both controlled experiments and retrospec- tive studies indicate that assigned goals can be just as effective as self-set goals, but only if those doing the assigning have the appropriate power and authority.12 Of course, goals do not always drive performance gains. To drive significant performance gains, goals need to be specific and challenging, not general or easy." The performance-driving power of a goal can be further enhanced by making it public. The driving power of a goal is reduced, however, when goals are overly complex or when individual goals are set rather than group goals when cooperation is needed. Also, goals have little value if they are not routinely articulated and discussed by organizational leaders. Finally, the power of challenging goals is unlikely to be tapped when people fear they will be penalized for not meeting them. Instead, goal setters will tend to select less challenging goals, which have a lower performance-driving effect. Specific, Challenging, Outcome-Focused Goals Drive Performance Improvement Goal specificity can be achieved by selecting quantitative and qualitative characteristics that refine a broad goal into a specific target. Goals are often refined into specific targets by indicating characteristics such as quantity (whether absolute or relative), time, place, population, or industrial sector. Embarrassed by the Russians beating the U.S. into space with its Sputnik launch, Kennedy responded in 1961 not just by saying the United States needed to build a strong space program. He selected a target that specified time (decade), / place (mopn), demographic characteristic (man) 1/ and quantity (a man). Target quantification can be absolute (10,000 currently obese children in California will achieve and maintain a healthy weight for their size and age, 99.9 percent of people served by community water systems will be served www.businessofgovernment.org ~ 15 PERFORMANCE ACCOUNTABILITY by systems with no water-quality problems), relative to a standard (air quality in every U.S. community will meet National Ambient Air Quality Standards), relative to the past (seat belt use will be 20 percent higher nationwide than the baseline established 20 years earlier), or relative to others (our school will perform in the top quartile of the state). Specific tar- getsenergize more than general ones, because they not only direct attention but also narrow goals, mak- ingthem feel more attainable. Challenging goals drive performance improvement because, perhaps counter to intuition, goal commitment is strengthened when goals are difficult and, more intuitively, because people (and organizations) work harder when they are strongly committed to a goal.14 Goal commitment is further strengthened when commitments are made public's But what constitutes a challenging goal, a stretch target? Edwin Locke, one of academia's leading "goal experts," has suggested that a stretch target is one with only a 10 percent chance of attainment.' Consider the "failure rate" implications of that statement: Nine out of 10 times, effective challenging targets will not be met! An incentive system that penalizes individuals and organizations for failure to attain all of their targets will therefore primarily be punitive and undoubtedly detract from the quality of the work environment. Clearly, for ambitious targets to drive performance improvement, they must be allowed to operate in a climate that anticipates missed targets. Missed targets must be viewed as an indication of a healthy, discovery-provoking, risk-tolerating enterprise. If individuals and organizations meet all of their targets all the time, it suggests the targets are too easy and therefore not likely to tap the performance-driving power of stretch targets. More challenging goals trigger highly effective work attitudes for groups as well as for individuals, stimu- latingcooperation and innovation. Researchers in lab experiments have concluded: "Subjects in the groups with the tougher task, compared to ones with the easier assignment, put out more effort, took more time to discuss how they would work together and what procedures they would use, changed their individual and group plans more often, and showed more concern for the quality of their work."" Setting specific stretch goals unleashes the workforce's reservoir of skills, knowledge, and instincts, and propels sustained, deliberate, and recurring strategy refinement to meet a goal. A specific, challenging target encourages delivery agents to "draw from a repertoire of skills that they have used previously in related contexts, and ... apply them to the present situation ... and ... engage in deliberate planning to develop strategies that will enable them to attain their goals...."'" In contrast, timid or easily met targets encourage a culture of compliance and control rather than one of creativity, learning, and rising performance. Specific, challenging targets drive performance whether they focus on individual Tasks, outputs, or outcomes. Agencies frequently achieve significant improvements in processing times, for example, when they set maximum allowable or average Goals Goals drive performance improvement and enhance accountability even without a link to extrinsic incentives when they are: • Challenging, but only for a few priority goals. • Specific, to focus and communicate where breakthrough progress is desired, continual progress is sought, steady state is acceptable, and slippage will be tolerated. Outcome-focused wherever possible-except in instances where resources or skills are inadequate to meet the goal, in which case learning and capacity-building targets are appropriate, or where the outcome goal is unitary in nature, in which case milestones are appropriate. • Constructively used by managers and others in the organization in a routine manner. Group, rather than individual, goals should be set when cooperation is needed. t 6 ~ IBM Center (or The Business of Government PERFORMANCE ACCOUNTABILITY Case Study: National Highway Traffic Safety Administration Sets Specific, Challenging Outcome-Specific Focused Goals After passage of the Government Performance and Results Act of 1993, the National Highway Traffic Safety Administration (NHTSA) and its parent organization, the U.S. Department of Transportation (DOT), set an ambi- tious goal of raising seat belt use to 85 percent by 2000.i9 It chose the goal because strong evidence inn ica~te ~t~at elt use signi icantly reduces a a t ies an accident severity. DOT recognized that to attain its target, it would need cooperation from states, localities, and automobile drivers, all of whom it could influence but none of whom it directly controlled. Yet because of the potentially high safety return on each federal dollar invested, DOT took the risk of pursuing this ambitious target dependent on so many uncontrollable factors. By 2000, the agency had reached a 71 percent use rate, up from 67 percent in 1967. In 2001, it attained a 73 percent use rate.'" By FY 2005, a nationwide 80 percent seat belt use rate had been achieved.21 It missed the 85 percent target it had set, but nonetheless achieved an unprecedented seat belt use rate.' The increase in seat belt use was obviously achieved not just by setting the goal, which focused and encouraged persistence, but by prompting a variety of non-traditional agency actions to meet it. It triggered funding shifts across DOT programs, for example. In FY 2003, the Federal Highway Administration directed funds from its budget to be used for state incentive grants to help NHTSA woo state and local cooperation, since the federal government does not directly enforce seat belt laws; states and localities do.~~ Winning state and local cooperation was not enough to change outcomes, however. NHTSA also needed to assist its service delivery partners in understanding how to change local decisions and behavior. It tested and evaluated a seat belt use marketing campaign, then promoted its uptake, acting almost as a franchisor. Case Study: Ohio Environmental Protection Agency Sets Specific, Challenging Response Time Goals The Ohio Environmental Protection Agency found goal setting very valuable when it set a goal in 2000 to clear out all administrative enforcement actions that had been in the docket more than two years. By the end of the year, Ohio EPA reduced the number of backlogged cases, some of which had been in the system three to five years, from 110 to 29. By the end of the second year, even with new cases, the number of cases exceeding the two-year threshold dropped to five. At the same time, the average age of all cases on the administrative docket dropped from 475 days to 325 days.24 Case Study: Federal Emergency Management Agency Encounters Problems by Focusing on Tasks, Not Outcomes Reluctance to deal with outcomes, the problems people face, proved a key weakness in the Federal Emergency Management Administration (FEMA) response to Hurricane Katrina. Even when it was clear that the state and local governments were overwhelmed by the magnitude of the problems caused by Katrina, FEMA leaders in the hurricane-ravaged area resisted whatever instincts they must have felt to fix the problems they saw. FEMA is orga- nized into discrete task groups, so the agency instead responded only to specific task requests made by the states and localities. The "not on my task list" orientation resulted in absurd situations. For example, when the state requested cots for firefighters, according to one senior state official who went to help his colleagues in Louisiana, "We got the 500 cots, but that is all we got. We didn't get any pillows or blankets:'Zs response time targets for a variety of transactions, While specific, challenging targets drive progress including correspondence, complaints, general toward any kind of goal, at some stage ove~ment assistance calls to 311 or 800 numbers, permit agencies need to adopt outcome-focused tar ets. applications,.andeuen enforcement follow-up. When tbep•f~' o o so,~ Inevlta y get caught on a trea I managing what they do, rather than w~vv.businessofgavernment.org I 17 PERFORMANCE ACCOUNTABILITY Case Study: New York City Measurement Efforts Thrive When Attention Shifts to Outcomes New York City was an early adopter of performance measurement, begun after the city's fiscal crisis of 1977. Some city agencies-such as the Sanitation Department, which hired observers to rate the cleanliness of each neighborhood-focused on outcomes. Most, however, did not. In 1994, when the New York Ciry Police Department adopted an outcome-focused goal to reduce crime, and then successfully used fresh and frequent measurement to drive crime down 25 percent in two years, it demonstrated the power of managing with outcome-focused goals and measures (Kennedy School of Government, 2001). This approach, known as CompStat, quickly spread from police to other agencies, with a similar positive effect on outcomes. Today, all city departments are expected to use outcome-focused measurement and management, now known as CAPStat, which stands for Citywide Accountability Statistics (Smith and Grinker, 2003). what they are trying to accomplish. Outcomes tend a e rom attention esptte t e act that govern- ment's obsession with outputs or processes, rather than with outcomes, was a primary catalyst that led to the reform efforts requiring goal setting and performance measurement. Goals Communicate The focusing function of goals serves not just to energize, but to communicate. This is an especially beneficial attribute when cooperation across large organizations or organizational boundaries is needed to meet a goal. It is also useful as a means to engage the public in the value-based decision making that goal setting inevitably is. Specific goals serve as a form of shorthand that inexpen- sively and concisely communicate where the people of an organization should concentrate their efforts and intelligence.~b A goal serves as a "guide for directing members' actions and integrating their moves."Z' It also serves as a form of shorthand for communicating with those beyond organizational boundaries-to enlist assistance and expertise, compel cooperation, and invite those in a democracy to exercise their voice when they disagree with targets that have been chosen.28 The shorthand communication value of goals does not help an organization, however, if it has too many of them. Government agencies often find themselves overwhelmed because. they are expected to do more than they can reasonably be expected to deliver. Successive legislative bodies and executives often articulate their priorities through law and policy directives, paying more attention to adopting something new than reconciling with or eliminating what was previously adopted. Even a single piece of legislation may teem with multiple objectives, the result of political compromise that fails to recognize (or chooses to ignore) the challenge it will present to implementing agencies. An abundance of goals, even if not inconsistent, overwhelm organizations, defeating the power of specific, challenging goals. That is not to suggest that an organization cannot have multiple goals.2° Effective organizations often have multiple goals in a single time period; they just cannot have too many challenging goals. All targets cannot be stretch targets. Government organizations can consciously use targets as a shorthand communication tool to manage the problem of unreasonable expectations by broadcasting relative priorities, Agencies can specify stretch targets for priorities and where innovation and experimentation are sought, areas where steady progress is sought, areas where perfor- mance can remain level, and areas where some slippage will be tolerated. Agencies may want to set less ambitious targets, for example, when evidence suggests legal requirements no longer have a signif- icant effect on improving outcomes but legislative bodies have not yet eliminated the requirement. Goal specification in strategic and annual plans can, in other words, be used as a mechanism for managing the seemingly unending demand on government agencies to do everything with limited resources.30 By inclusion and omission, the goals that an agency includes in its strategic and annual plans commu- nicate to the people of an organization and to the public what an agency will do and what it will not do, strengthening democratic accountability. 18 I IBM Center far The Business of Government PERFORMANCE ACCOUNTABILITY At the same time, if the targets in strategic and annual plans arc inconsistent, the communication value of goals is diminished. Thus, when the U.S. Department of Health and Human Services set a target in its FY 2004-2008 strategic plan of reducing the proportion of Americans who are obese by 50 percent in 10 years (from 30.9 percent in 1999-2000 to 15 percent by 2010)" but failed to include a specific annual target for obesity in its annual plan, it sent a confusing signal to the organization and missed an opportunity to drive performance improvement.' Similarly, if Specific, challenging targets do not ali n with he tonics being rem lard discussed by mana ement, the workforce tends to lose sight of the goals. Instead, its I s attention to concerns managers are voicing. Outcome-focused goals often increase the need for cross-organizational collaboration. The need to communicate the goals to the public with a plan to meet them often necessitates new inter-organizational arrangements. When the U.S. Department of Transportation set a specific target of cutting railroad crossings accidents in half within six years, for example, it spurred cooperation between the Federal Railway Administration and the Federal Highway Administration (FHWA) because FHWA controlled the incentives that could get states and localities to make the problem a priority. Establishment and communication of a specific, challenging goal can also enlist goal allies and keep a problem that concerns the public on government's action agenda. The Kyoto Protocol, an amendment to a United Nations treaty on climate change negotiated (but not ratified) in 1997, established a specific target for each developed country to cut overall emissions of greenhouse gases by at least 5 percent below 1990 levels (by 2008 to 2012.) The Protocol illustrates the performance-driving power of a specific, challenging goal. Even without being legally enforceable, the goal's continued mention in the media, by other countries, and by organized political players is keeping the issue on the policy agenda, demanding attention even in countries that have chosen not to ratify the treaty (most notably the United States and Australia). Goals Strengthen Democracy and Accountability Agencies can use specific targets to inform the public about what they intend to do and what they intend not to do. This is an especially valuable tool when an agency believes it has more to do than its budget allows. Of course, the public and its elected representatives may not always agree with govern- ment's choice of specific targets. Numerous democratic mechanisms exist, such as legislative hearings and elections, which citizens and their elected representatives can use to express support for or displeasure with specific goals and suggest changes. Legislative hearings do not always afford the most conducive environment for discussing goal appropriateness orrefinement, however, and agencies may find it hard to sort out political grandstanding from genuine concern at such highly staged events. Unquestionably, those in government seeking to tap the power of goals and measures to improve outcomes fare better if they have thick political hides and anticipate the legislative, media, and advocacy predilection for criticism over praise.j; Government agencies may be able to do more than develop a thick hide, however. An increasing body of evidence suggests that agencies can lessen beatings and enhance accountability by considering the interests of, informing, and engaging specific audiences. Few legislators, journalists, or advocates have either the experience or education in management methods likely to make them familiar with arguments for setting specific, challenging organizational goals ambitious enough to result in many missed Case Study: Missed Targets Not a Problem for EPA on the Lower Charles River The U.S. Environmental Protection Agency failed to meet an ambitious local goal that the Lower Charles River in Massachusetts would be swimma- ble in 10 years, a goal it set in 1995. Yet it encoun- teredlittle criticism from the local community and media when it failed to make its 2005 target, most likely because of its sustained 10-year commitment to meeting the goal and the way it informed the community about its strategies, whether or not they worked, and its updated action plans.3a r. www.businessofgovernment.org ~ 19 PERFORMANCE ACCOUNTABILITY Case Study: Missed Targets a Problem for NHTSA Under PART The National Highway Traffic Safety Administration got "dinged" by the' Office of Management and Budget (scoring "Small Extent" rather than "Yes") in its Program Assessment Rating Tool, or PART, process for not making consistent progress toward its goal and for not meeting every annual target: Over the long-term, the program has demonstrated progress toward achieving its long-term goals, as the highway fatality rate has decreased from 1.75 fatalities per 100 million VMT (vehicle miles traveledi in 1992 to 1.50 in 2003. However, NHTSA has not shown significant progress and did not meet the targets over the past three years. For the past two years, the rate has stayed the same-1.5 highway fatalities per 100 million VMT.'S targets. Arguably, then, agencies could benefit if they try to discuss with legislators the motivational value of setting challenging goals and thus the implicit need to tolerate goal non-attainment in venues other than televised hearings. Agencies may also want to create explicit mechanisms, such as open meetings, to discuss goal selection. Mayor Anthony Williams of Washington, D.C., launched the D.C. Scorecards, his goal-setting and performance-measurement effort, with a citywide forum of citizens to discuss city priorities. Used this way, specific goals not only drive performance improvement, but strengthen democracy and accountability as well. One factor that threatens to tamp down U.S. federal agency adoption of ambitious targets is one aspect of OMB's annual Program Assessment Rating Tool (PART) scoring process, an integral part of the budget process. Most aspects of PART have had a positive effect, pushing agencies to adopt ambitious targets, including rewarding agencies that adopt ambitious long-term and annual targets with a "yes" score on two questions. PART penalizes the same agencies, however, when they do not attain all of those tar- gets, inevitably frustrating agencies who genuinely appreciate the value of setting challenging, realistic targets. If not adjusted, the expectation that agencies will set ambitious targets and meet all of them or get penalized in the PART scoring process will undoubt- edly prove confusing and frustrating to many agencies. • Cautionary Considerations Specific, challenging goals are powerful tools that can drive performance improvement and enhance account- ability, but only if used and only if individuals and agencies are not penalized so seriously for missed targets that they refuse to set ambitious, outcome-focused ones. Specific targets also have limited value if they are conflicting, confusing, or so numerous and unconnected that they are ignored. Researchers have identified several additional cautionary conditions that can interfere with the performance-driving potential of goal setting: A lack of supervisory support for goals undermines employee interest in them.36 If organizations treat goals merely as words on paper, used in strategic and annual plans but never mentioned by managers, few in the organization will pay attention to them. Assigned goals can be as effective as self- selected goals, but not if assigned tersely without explanation of purpose or rationale.37 Even for outcome-focused goals where the goal itself reveals the purpose, a rationale explaining why a specific target was chosen over others can enhance commitment to the goal. • If a task is overly ambitious and so complex that it makes people anxious and confused, it is better to break the goal down into component parts or to set specific, challenging learning goals instead of outcome-focused ones. • If a government program lacks data to measure outcomes, staff to analyze data, or contracts to hire needed expertise, then it can be more appropriate to set challenging initial goals to acquire those capacities than near-term outcome targets. • While a few goals should be challenging, they must also be realistic, taking into consideration available resources, skills, and authority.3" • When cooperation is needed to accomplish a task, group goals are far more effective than 20 IBM Center for The Business of Government PERFORMANCE ACCOUNTABILITY individual goals. Indeed, when cooperation is needed to do the job, individual goals prove inferior not just to group goals, but to no specific goal at all. Individual goals can work when combined with group goals, however, provided the objective is simple enough that group goals can accurately be broken down into individual goals.' If goal commitment conflicts with workers' beliefs and prior behavioral practices, cognitive disso- nance sets in. Workers will try to restore consistency by changing either their beliefs and behavior or their goal commitment. Strong goal commitments can shift beliefs and behavioral practices.40 Summary and Implications In sum, setting specific, challenging goals is a pow- erful, performance-driving tool except in instances where resources or skills are inadequate to meet the goal, in which case it is better to break the challeng- inggoal into more manageable milestones, includ- ing near-term learning and capacity-building goals. Insetting targets, care must be taken to provide clarity of rationale and purpose; avoid complexity; select targets that are reasonable in the context of available resources, skills, and authority; and resist individual goals when group cooperation is needed. Specific goals are also an effective mechanism for enhancing democratic accountability. They start a conversation with citizens about whether or not an agency has adopted the right priorities. Goals do not need to be linked to any incentive- rewards or punishments-to be effective. Indeed, linking incentives to extrinsic rewards or punishments can interfere with the performance-driving effects of a goal, a topic explored more fully in the section "Building Block 5: Cautious Use of Externally Provided Incentives." Specifically, if those setting targets fear the consequences of missing them, goal setters are more likely to select targets they can eas- ilyattain, forgoing the performance-driving potential of challenging goals. To be useful, goals do, however, need to be used. And they need to be used in a constructive, not a critical, manner. Moreover, unused goals mislead the public and compromise one aspect of democratic accountability-that the public knows what government is trying to do. Therefore, managers should intentionally employ goals as a tool to stimulate performance gain. And legislators, budget offices, oversight agencies, and the media, in their quest for accountability, need to allow agencies to set and fail to meet specific, challenging, outcome- focused goals. If they do not and instead continually criticize agencies when goals are not met, it will interfere with the potential for goals to drive constructive change. Specifically, to bring goals alive, they must be accompanied by feedback.a' Managers need to ensure that workers are provided that feedback. For goals to be effective, people need summary feedback that reveals progress in relation to their goals. {f they do not know how they are doing, it is difficult or impos- siblefor them to adjust the level or direction of their effort or to adjust their performance strategies to match what the goal requires. If the goal is to cut down 30 trees in a day, people have noway to tell if they are on target unless they know how many trees have been cut. When people find they are below target, they normally increase their effort or try a new strategy.az Without feedback, people and groups tend to believe past practices were more effective than. they in fact were, prompting them to set overly ambitious goals and then invest in wasteful strategies to meet them.a' Feedback comes in two forms which tend to be complementary: measurement and verbal feedback communication discussing progress toward a goal. These are the next two building blocks to which we turn our attention. wunv.businessofgovernment.org 21