THEGovsRNoRsCENTERAT Durp UNrvERSrry BOTTOM-LINE GOVERNMENT Robert D. Behn The Governors Center at Duke University Terry Sanford Institute of Public Policy Box 90246, Durham, NC 27708-0246 I r 9 - 6 t 3 - 7 3 74 Copyright O 1994 by Robert D. Behn BOTTOM-LINE GOVERNMENT Robert D. Behn "The problem with govcrnntent is that it has no bottorn line." This criticism -- often offerecl by exccutives frorn thc private sector -- is similar to the complaint that governmcnt executives never havc to rneet a payroll. Governncnt does not make a profit. Government does not even try to marke a profit. Rzrther, govcrnment just docs things ancl when it needs rnore money, it just increases tarxes. Or, as the fecleral government has donet increasingly over the past decadc, itjust irtcrezrses thc clebt. Bu1 the absetrcc of :r governmental bottom linc is, in lirct, ntoret darnning than this traclitional business critique. For it means that government clocs not know how wcll it is doing. Withottt some kind of bottorn line, government cannot measurc progrcss. Withotrt a bottom linc, government cannol motiverte employccs zrnclcitizcns to nrake progrcss. Witltclut a bottom line, governntcnt cannot decicle what is broken and neecls to be fixcrl. Without zr botton-line governntcnt ceunot enctollrage innovation. Without a bottom line, governmcnt cannot convincc citizcns thart it is worthy of their strpport. Thc'zrbsen<reof zrbottonr linc is r-rot,howcvcr, inhercnt to governrrrcnt. Sure: governrnent does not lt:tl'e tu produce a bottorn line on its income-and-expense st:rtcrncnts or balance sheets. Government cloes not try to makc n profit. And ccrtainly a gorrernrncnt does not go out of business when, over scvcritl vc:rrs, expenditurcs hzrve consistentlv excccded reverrllcs. Nevertheless, government does herveta rnultitucle ol warys Lo rrrcastrre progrcss. Sonre nre tradition:rl finarnci:rl Irleasures that comc of[abalance shcct or an incomc-ar-rd-expensc stertcmcnt. But othcr, morc important bottom lines measurc l"rowwcll a prrblic agencv is cloing in serwing thc citizens. The challengc lacing government lcaders is not to invcnt crs:rtz, linancinl bottom lines to mimic the private sector. Rather, Ll-tc challenge is to choose. li-onr anrong tl-re rnultitude of existing bottorn lines, a few to use both to improve the perfornrnncc ol-prrblicr ngencies zurd to increase thc faith of citizens in their govcrnmcnt. Measuring Progress -- in Business and in Government 'I'he concept ol-a br.rsincss firm's bottom linc suggests thzrt thcrc is n single nurnbcr -- t/re bottom line -- tl'rat tells whether thc firm is profitable or not -- rvhether it is cloin{ argoocl job or not. ln lact, ltowcvcr, thcrc zrrc ar multitur.le of finanr:ial nreastrres tl'rat l'rclp re.veal r,vhether the firrn has been profiterble in tl'tc past ancl, cvcn rnclrc irnporlarntly. rvhctl'rer it rvill bc prolitablc in the future. In evalutrting a lirm, :rn investor looks at urorc than what nriglrt be callccl the 'l'hc traclitional bottonr line -- net prolit (revenues urinus e.xpclscs). investor looks att arvnricty of financial indicatclrs: gross sales. return on salcs, nrarket sharc, return on cqrrity, retainecl carnings, thc debt-equity ratio. net wortl-r, and net wortl-r per share . Moreover, the inrrestor looks at a number of iess easily-measurecl indicators, such :rs inrprovenrents in the quarlity of a service clr the reliability of a product, the market potcntial of a new product line, or a shift in internationtrl competilion. A business firm does not have one bottom line. It has many bottom lines. Even when a firm's revenues drop below expenditures, the firm does not automatically go out of business. It has several options. It, too, can borrow money (though also at higher interest rates). It can file for bankruptcy -- seeking either to dissolve the business and pay off its creditors or to protect itself from its creditors while reorganizing. Or it can seek a government subsidy. A Copyright O 1994 by Robert D. Behn Robert D. Bel'rn: Bottonr-l,ine Gorrernment P:r{e 2 bottonr-line thilurc -- or merely a bottonr-line inaclcquacv -- suggcsts various fbrms of crtrrr:c'tivc irction. Going otrt of blrsiness does not rnerely retler:t a f:rilurc of the bottor'r linc: rarther, it r-cflccts a t:rilrrre to unclcrstancl {or eff-ectivelyrespond to) prior clcllcicncics in nrultiple bottour iincs. 'fhc problern rvitl-r {o\rcrnnlcnt is not thart it ferils to itetrrcit bottonl line. Likc :r btrsiness. 'l'hc problenr r',.itlr :l goverrnnlent (or an incliviclual governrnent agcnt:y) hus rrrultiplc bottonr lincs. {Io\/ernnrent is t}r;rt it lails to use thcse reaclily-availzrblc bottorn lincs to a<rhievethc aclvant:rgt:s thzrt busincss clcrivcs frour its bottonr line s. Be<rzrusccrxnplct.c failurc zrlong multiple bottclnr lincs ciocs not ilutclnraticirlly lbrcc ir gov()rnmcnt agencv to go out cll-busincss, thc irgerlcy ('i:lll irlrrorc the signuls li'clrn thesc lrrcasrrrcs of pcrlirrnritnr:t: :rrtcl, instead, croncentratc on urc:rting a c - o n s t i t t r r : n c _fvr r r i n c r e : r s i r r g n c x t y e : r r ' s b u c l g c t . A n c l t h i s c ' o n s t i t u c n c y n r a y c a r e : r b o u t a b o t t o n . r linc that iras litlle to clorvit.h the argcncy's pt'rftlrnriulcc -- rvith its ability t.o:.rctually pro{lrrcc sonrr: c i c - s i r c cpl r r b l i c - p o l i c y r c s r r l t s . Ccrtainlv, sorrre governlnerrlt ?rgencics rlo crrcatc thcir own bottom lines to clc--tcrnrinclrou' rvcll thcy arc cluing, to nreasure pro{ress. to rnotivitt.r:pcoplc, to cleternrinc whttt neecls to bc fixccl, ancl to con."'ince citizcns that it is rvortl'ty ol-thcir support. I-ike zr busincss, these govcrnmcnt a g e n c i e s h a v c t r s e c l t h c i r b c l t t o n r l i n e s t o i r n p r < l v ep e r l b r n t a n c c . I n 1 9 9 2 , t h e B r t r c a u c l l -M o l o r Ecltriprnent of the Ncw York City Departrnent o1- Sarrilertion won one of tltc Forcl 'l'o inrpror.e Fotrnclation/Hnn arcl Univcrsity zuvnrclsfirr Innovation in Staic ancl l-octu.lGovcrnntent. BME s ltcrlbrnriur<:r:in nrerintzriningernclrc1-iiriringtlr<nrsanclsctl.sanitat.iotrvchiclcs, tfrc lcatclcrship cntployccl a rrarietv of ltottonr lincs including thc pcrcentagc ol-r,chic'lcs available for scn,icc, the ltcrt'entnge ol-r,chicles lhat brcak clown cltrrirtg scnricc, ancl the t':ttio ol-IIME rttainten:tncct t'osts to iclenticarl itrirraLc-scctor costs. Unlbrtunzrtcly, srrclr cxcrcisr:s of creutive public le:rdcrsl'tip are uritke proclttctive ttse of a bottclnr too rarr' -- so infrecilrcnt thzrt, whcn n governrnent :rgencv 11<lc's linc, it iurtomaticerlly rvarrants itwe itlrcl pr:rise ^ Government's Traditional Measure of Success "brtreattcrats" bc nrclre Whv clcln'twe hztvc more innovation in governnrcnt 2 W1ry tt'on't ottr -arnclgovertrnrcnt bttrc:rucrats -- alu'ays lbllow the c.rcativc? Whv clo governnlcnt bureaucracics stanclurcl opcrating ltrocedurcs rather ttrarn try to rnzrkc c'reittivc ttsc of thostr rules to archicve thtt rearl purp<lscs for rr,.lricl-tthc organizzttion was creartccl'/ 'l'l'rc ansg,cr, I think, is rerther obvious. It lirllorvs lionr thc systcnr clf rcr.verrcls:ttrcl punishntents c'rrrrcntly built into govcrnrttcnt -- :r rcwttrcl systcrtr that rcsrrlts clircc:tly ll'ortt thc lack of any rvcll csta.blisltccl bclttorn line. \\4rat l-r:rppcns wl'rcrr 21governnrcnt cnrployce breaks it rttle'/ Whtrt happetrs whctr tr trivil scrant tries tcl bc rtrctrt.ivc in an c[ftrrt to :rcr:onrplish sorrrc prlrpose lbr which thc itgt:ncy rvas crcatcd'/ Mayltc notlring. But n.rnytrr, jrtst rtritybc, a jclurn:rlist, or a legislittor, or it political 'l'lte "AgertcyViolatcs "bcnding" Ilttles." lteacllineblares: o{'tlrc nrk:s. c'arlclidltc hears about this "Wltcrl arc yollr cnrployecs goitlg Tlrc crusading lcgislator clcnranclsof the ernbattlccl agcncy hcacl: 'l'lrc "lf I ertrtcict'tecl, I cttt't ttssure cancliclate pronrises: to start followingyour own proceclures'/" you, the Dcpartmcnt of Proccclures rvill stnrt obcyinS thc law." \Mto, thetr, cotnes to thc def'errst of tl'rr: govcrnment crnployee who was, inrrrccliblv, .just trying to clo a l>ettcr job? Maybe, whcn a cretrtivc civil scnrant trr.ro t<i lt,-'ip acrhicvc rvlrat hc or sl-tc thought rvlrs tire 'l-hc otrt'e-t'rcitti', c agcncy's purpose, nothing happens. But not inlicclttcntly, zrllltcll brt'aks loosc. rrivil scrvant may not lose his job. fJtrt ]rt-'ancl erzeryoncclsc in thc itgcncv hztvc certaitrlv lcrrrtt'cl "success": Alw:rys follorv the rules! You cirn nc\rcr qet ill an important lesson of bureaucratic trouble by following the rules! Robert D. Bcitn: Page 3 Ilottom-l,ine Government A task lbrcc (of rvhich I was a member) inlen iclved all thc top cleputies in a lzrrgc' "How does yoltr goyerlment 2genc.y. Onc nrember of our group asked cvcry onc rlf the sc clerputies: Sgcpc\' ]tt:itci cvalulrtc vorrr pe.rforrnirnce'/" It rvas it ntost ctttltarr:tssit-tg cluestion. Somtl avrlicic'cl eve c.oltact rvilir tlrr:1lisk {irrcr.. Sortre sl'rtrlllecl tl'rcir lcet. Nctnc lttrd:r clear cxplanatititl of hrlu' 'fhe best tlrert solne of thettr cotrlcl of horvtheirperrlbmnance was ntcrzlsl.rrcrl. tScv rverc er.erltrzrtecl, ol|cr rvus: Wcll, I grress if I keep nrv nalnrc out o{ thc rtctvsplipcr, I'rn clrling e gcxlcljclb." Is thlt llrr.' ltest wc catl tlcnrancl frorn govcrrtntent, liottr govcrtltltcttl crnpioyees, ertlclll-rlrlt -- if yotr clo t-tot rtlilkt' lt goyerlrlcllt lciiclcls'/ If volr kccp yorrr nzII-Itcotrt o1't.lrc trt:r''u'sp:rl)clS j0b'/ Lit.t.lcwonclcr thtrt {ov()rlllllcrllt crulllovees ilre ltot t'ct-t nristake Vou alrc cioing zr goocl "'I'lrotr 'l'hc s h e r l tn < l t r r t a k c a n r i s t i t k r ' ' t c n r . o r n n t u n ( l r t r c n t so f p r r b l i c s c r v i < ' cu r t : s i n r p l c : creative. 'l'lrou 'fhou Iror if you d<l nrerkc ii nlist:rkc." tnttke a sltalt. trot shitlt 1ot trrlke :r uristakc. g e t pttt'tishcrl. y o t l t h c r u l c s pristirke if-vou clo sotnctlring, anything. thzrt violatcs 13utstrpltoscyouacttritlly:rcconrplishsonrething'/ Whathitppelttswhctryrlttt:rkt:acrt-'illi\'(' step tow:rrcls ac:hieving urr] irgeltr:y's nrission'/ Nothing. Al1.cr all, ilow clo Vou krlow yoll \\'('l'(' srrppclsccl to ercccltnplish thzrt'/ W. Ecftvarcls Detning, tlrc ntan who Lerught thc ,,lap:utt:sc how trl bc Japelnese itncl. thir-tr verlrs lzttcr, cnnre to bc rcvcrccl in his own country ars thc lathcr clf-totirl c1r-rirlitylllzllragcnl('llt. auglecl that 85 perr.ent ol-the tiurc thc pcoplc nrc not tl'te problcrtt, thc systcrlr is the prclbletll. L)o ,rnt blor-1a,t5e crlltlt-ryt:cs who are unsll('('cssltrl in thcir cf-lilrts tcl trttrkc'a.n ltraclccluate svstt'tti rvgrk, sariclDcrtring. Liiarne thc systcin. I3lartnetlltosc wiro t'reatccl thc systelut. CerL:riply, tirat is trtrc in it bottorrr-linelcss guvernnlctrt. IIrlrv rvorllcl wc expect peolllt' trr lbr violating t.he standard opcratirti beh:u,e il-they r,vork in tr s-Vstcnrthat punishcs the irrcli'n'icluzrl -rcgarclless ofhow nobler or inrport:rnt a pr:rp<-lsctttcy werc t.ryitrg tcl archicve lrrtl proceclures r'vhatt llto-'' prccisely arll rlcl rvrilrld clocs 1ot rcwarcl thcnr lor uchieving arny such yrurpose? Wc 'l-r1-(by ottt kec'P rule) to at singlc violtrling not nraking a single nristtrkc, by not clcputies clicl: "lrcl tt'r' if that it. Brrt to clo rvay bettcr ,ancs out ol'1he lcwspapcr. Maybc wc coulcl ligtrre out zr "bettcr" r,veryrnakes us vulncrerble to criticistrt, rvhy bother'/ It ctttr otth rvay violzrtes er1rlc, iI'thnt get us in troublc. With<tut a bclltotn line, withouL any way to gilugc l]orv tnttch a govcrnnlent a$etrct' ts nlctt-it :rccomplishisg, thcre is ncl wzry lo tcll rt'hether it hzrs achicvecl itn\/ success. Thcrr, the onlv sllt-cil'it rvitl'tottt a lirtet, it bclttont Witltout clf zrry .gency's perf<lnnanc'c is its ntrnrber t,rflailure s. "'fltotr ,rr",,"L,." of progrcss, a governnrent trgency's de-fctclo, ol)etrittillg <'rccclllccotnes a sintplc: shalt not nratkc er nristakc." Motivating Performance N o r v : ; u p p o s c t l r a t L l r c { o r r r t r n n t c l l t a { c n ( ' } . ( i o t : s 1 l : t l ' ci l V e r J s l l e t ' i l i c b t l t t o t r l l i n e l . [ ' ' o t . . r yearr. Fot.rL s t a l e h i g h r v : r y d - p a r t i l r r : r r t , t h a t r n i { h t b c : l } r i n g 1 5 0 r t r t s a l c l l r i c l g c s r l p t t l t ' o c 1 tt:h i s this vt'itt' nrcitsles ilgililhit ytrt'st'ltoolcrs 5,OOO city hc:rltl'r dcpartnrcrrt, that. nti{ht bc: frrrntr-rr-rizc p o ittts tltt: b \ ' 2 5 s ( ' t l L c r e . ' t c l i n g l t v t ' r ' ; t , { c l l t t elcqrcptairy st:lr9el,thlt rnight bc: Irrr:reirsc F'r.n N o u ' t l t c p c i l plcli'i t'' )re..rrN . ,r.vttrc{<lvernrnenl:rgcnr:yhassorncthing'u'e:rvsltccifi<'toitt'c<ltttlllislt. t l t c N < x v t l r t ' r t l l e s . l i r l l < t u , i r r { t l t i r r t o t h c r lltloPl,' w o r k f ' r t 6 a l a g e p c y h a v c a n t ( ) : 1 s u r co f s r r c c e s s rclrcliii* r , v h 0 r v o r - ki n t l r e r ti t g c t r C y- - n r i t . j r r s t t l r o s e tw l r < tr c i t a i r l t r i c l g t : s .i t r t n t r - l r t i z t r' l t i l c l r c n . t l r t t ' t t t r l . t - , z r l l k n o v u r, v i t a t t t r c i i j c l b i s . E v c n i f 1 , < l rr-lro i r o t i r t ' t i r r l i v r e l t r r i r l t r i c l g c s , \ ' t x t t t t r r l t ' r s t t u r c lt i r i l l . i t ' : irbilitr t' tlis yeitr atlr1nvly, the pcr-lbrnrancrt'ol'vorrr organizatiotr is itrt'itsurctl by'\'tltrr t'tlllct'livc n t o c hilclrett: v l t c C i t l e r t l t c : n t c a s l c s i n j c c L nrake lbO bridges saie. Even if'you clo noL actually r:rtlle r' art rrr:rtlt or yor-t if tcac'tr Evcn who clo. those arms, y.' undelstand that your job is to help coDtributt's that way in a thosc subjects to tcach than rcacling, you understancl ttrat you oughl Robert D. Behn: Bottom-Line Gorrernment to your students' ability to read. A clear bottom line can have a major role in motivating to achieve that purpose. Page 4 people At the Massachusctts Department of Public Welfare, the leadership team that created the tr'f CHOICES program to help welfare rccipients become economically self-sufficient ernployercler vcry clear bottonr line: 5O,OOOjob placcments over fivc years. 1-his fivc-year bottom line w:ts clivicled into annual bottonr lines, which, in turn, rvere clivided into rnonthly bottom lines for each of over tifty local vu'clfare ofliccs. Thus, earcl-twcllhrc ollice haci a n'ror-rthly bottom line: place fiver 'lhe department kept and (or ten or twcntv) rvclfarc rccipients in .jobs dr-rring thart tnonth. publicizecl thc clata incliczrting r,vhich locarlolTiccsnrct thcir rnontl'tly bottom line zrnclwhich did not.^ Ancl those local offices thart achievecl thcir :rnnttzrl bottont line were publicly praised with cerernonies, plaques, and press attentiotr. Crcating Lhat sirnpie bottom line for zrlocal rvclftrrc office changccl completely the inccntives fortheclircctorofthatolfice erndforeveryonewhorvorkedthere. Nort'thereexisteclzrnindicatrlr of slccess (erchieving thc annual goal of placir-rga specitic numbcr of rvelfare recipicnts in jobs) tl-rat compctecl with the indicator of faih:rc (breaking a rulc). Morcover, tl-re cleparttncnt's leerclersfiip nrndc it clear that this ncw bottom line ol'sucoess wels nlorc import:rnt th:rn tl'tc olcl bottonr linc of f:rilure. In irclclition, tl-rc clepzrrt.mcnt'slcaclerslrip undertook to elimin:rte as rllany of t.hc cllcllrles:rs possible -- particultrrly thc rulcs thut itinclerrccla local office's ability to ircl'tievc SLICCCSS. Aller all, tfie olcl rulcs werc not clesignecl tci ]rclp local olliccs fincl cmpltlynrcnt for wclf;rre rccipien1s. Rather, the olcl rulcs were clesigncci to prcvcnt that olcl trio of govcrnnlcrllal c-vils: No ortc worriccl that tltose rulcs got in the way of finding -jobs for fi-:rtrcl.rv:rste, alcl abuse. 'l'h:rl bottom line hacl not cvett cxistcd bclore. Incleecl, uo bottom linc l'rzrd rvclt:trc rcctipicnts. existccl belbre, so the rules coulcl not gcl in the rvav. El'l-ectivclv.tlte rulcs httd becn the llottont linc: Tltou shzrlt not m:rkc a ntistake. A new competing bottont linc ciicl, of coursc, confltsc sotttc ertrployces of thc dcpartmettt: lorv long will tl'resc new leaclcrs lrrst'/ In tl're prcviotts cigltt 1'citrs, <tttr dcpartnrent tras had fivc comrnissioncrs. Wrtn't this nern,crournrlssi<lnerattcl ltis lcaclership tcilru lc:t"'e soorl too? Ancl rvon't t.heir new bottom line lcave I'u'iththcnr'/ Ancl besiclcs, ltttrv atre wc stlJ)llosecl tcl achieve this trcrv bottom line anyway? Thcy het'"'en'ttold us /roru." "l 'l-honrits I'. Glynn, Barbarzr Indeecl, the clcpartnrent's lezrclcrsl'tip- Cltarlcs N4. Alkins, 'l-hcy 'fatum, werc rclyirlg tlpoll the ingetruitv clirl not knor,v ltotl. ancl Jolie Ilain Pillsbury Btrrke - to tigttrr' of thc clepartmcnt's cmployees-- of thc lclc'alotfic'c rliret'tors trtrrl o1-thc social rvttrkers (Flarlarcl ['ress) lJnirrersily , I he1'u'c <rrrt lrotu. ln ltaclerslrrp Corrrrfs; k'ssnns-fitr l\ltlic Mantogers it't fttct, line. Ancl, clcscribecl in dcl:ril irourLhc dep:rrtnrcnt achievecl its o.'l'tr,st:lf:crezitccl,bottttul itl thc ol-nlanY crclting the spccitic:, bottorn line of-job placenrr-nts tlicl entrrgizc thc creativity clepartmcnt. S o r l c r : r n p l o y c e s r e s i s t e c l l l t e r r c w , s u c ( ' L r s s - o l i t ' n t t t c lb o t t o r n l i n c . c l r t n g t o t l t e o l c l 'on-{aiir-rre dcfinition, zrncltrcr,'erslflnecl cln to Llre ner.r'role that t]re leaclersltip wtrs artlemptit'tg ttl -- sornc rvillin{ly, others rvit}r :r littlc help. Brtt nr:rtrv create for Lhe clepartmcnt. M:ury of thcse lcft fopnd the ncw demancls placed upon them a charllengc ancl rverc pleasecl rvtren the agcllcy fbr w1rich tlrey workecl reccivecl attcrrlion in thc prcss, nol firr firiling to cotnply $'i1h sorne rttle. iltll for actrrally ac1rieving an aflilnrativc success. Irrrltlic' ernployecs rvho harr.lbeen ashtttrteci ttl saV rvhcre they workecl werc now prclucl to clairn {even if they thcurselves dicl Irot plarcc rvcllhrt' recipients in jobs) that they workecl tbr tl're Department of Public Welfare ernd thc trT CHOICES program. Robert D. Behn: Pagt' L Bottom-Line Government Neutralizin$ the Overhead Bureaucrats -- the "burealtc'rlttt But rvhat zr.boutthose people whose only job is to cntbrce the rules personnel? Will not tht't' who work in the orrerhead agcncies of buclget, procllrenlent, atrcl necessary to:rt'llr' creativity the inhibit line bottom keepers of the traditional, no-ntistakes will not the ovelt'llt'i'' or diffcrent. ncrw do something to wants success.? When ilre line nranager "That's against the rules"? Even if ther ncw or differcnt something i-s tr' manager flatly stzrte: overhcad managcr ilr(rr' really againsi the law (or even tl're formal regulations), will nttt the '/ 'Thai not the way it is done. You c:rn't do it Lhat wzry bec:zruse-- well -- j lrst be causc' s an argLllll('1.' ccrtzrinly, theywill try. Butnowit is a lair iight. Nowthe linc nlzrnagcrhzrs hard tht: oI r. tnzrnzrgcrs overhead the Ilefore, nlanager. orrcrheacl il-rc with with rvl-rich to clo battie -- on their sidc. Anytliing that broke thc mlcs - irlrit'L : measllre ot'success -- non-fa.ilure -- was to be stopped. Now. ht)\\'r"'' : anything that could possibly be criticizecl for brcaking a rule "That rule is preventing us frorn accomplishing our p1lrl)os(" the line manager cor',.,,.rgr.i"' j':'l'hc rule is stupid ancl shoulcl be changed, or at lcast waivcci in t achieving our 6ottom line. rI t Slrt' go talk with our rntltu:rl boss' case. Ancl if you won't aruthorize such a moclificartion, lct's lll"' nlle prevcnts us liom cloirlq r'e that lny agencv's job is tcl achieve this bottonr linc. Yolrr botlom line, or your nrlc lrrli'nry of importancel the about nrind hcr lf our boss has ch:ur.ied Norv." priority over my bottorn line, I need to learn that. Direcllv frrlm hcr. ' rvlto enltlrce rulcs tlllrt Gclvernment cloes not. hnrrc :r monopoly ort ot'crhelaclnlittrtu{crs ' tllso cotltplain, lbr cxamlllc' rtlr' in the rvay of purposes. Liner nrzrnagers fronr thc privatc st-ctor , , b e n nc o u n t e r s " i n t h e i r b r r c l g e ti n c i f i n a n c c u n i L s w l l c l t : t t t t ' , ' t : t ot l ' t t rs p c r t d i n g ( i ' e' , i r N ' c s t l r l ' : ' the lirnr tolcl trbottt thc budget pcolllt't'l clec.isio's o1 line marlergers. Sci,eral man:rgers tiom onc lorcc lltlt thctr spertt si\ ttt"r'': a u t h o r i z e c l t h e h i r i n g o 1 ' t \ v o , h t , n c l r c c ln e r , vp c o p l c l b r t h e s t t l c s ncw salt-'spcrsclnnel neccie(l tr t t i t' ' "' deciding wherther to purchase the 2oo autclniobiies thzrt thesc thcir sales calls. "Tltzrt's stupicl -i'i' arglle: Itr the private sector, horvever, thc line melnagerrcan aiways . litrc is gross salcs, clr rcturn oll ctllrit\ decision lrtrrts onrbottonr line." Whether the bottom tt't':; ill linc llltlnager can al'uvilysargLle some othcr nleasure ot'sur:cess tl"rat thc firnr is using, tlte ' ahv:rys win' Bttt at least in iurt' lit: not clo mertlagcrs line the of that bottont line. In business, casc: 1'heir contpany's botttlttt lirr' they always have awick'ly acceptecl basis lbr makinS thcir precisely because therc is 11i1ll.lt' :' In govcrnnrcnt, overhc:rcl manargers arc so po',verlhl bccause therc is no bottom litte rrll:' : line. ln government, the overhead rules arc so clomin:rnt rules. only by crcilting il nc\v' l)o:111 than not making the mistakc of breaking oll€r o1 tirose to achicve ancl thzrt tltc lloiitr' ' bottom line --:r specilicr goirl that the agcncy is attcnrptinq ' t es(rapc lionr the conlining overheilrl r.L: leadership ,.rppn.iu -- celr] lhe linc manzrgers'hope to that prevent ttrem from accornplislring anythitrg' Goals: The Moral Equivalent of War For cx:rmple, when $oVCrllIllt':.' Gorrernment is not always inefficient and ineffectivc. :r lot of energr a,nd intelligence \'( :decides to launch a war, it can mobilize ancl concentrate --- the bottom line is very clear. Wren the Unilecl Strtl' quickly. Wry.i Because the objective t' tlrt' suddenly, disappeared. decicled to go to war with traq, att the bureaucratic obtuscation "Does this action violate a rule?" to L)'' liom dramatically shlfted of whether to clo something employee had a very clear bottoru lrrr' ' this action trelp win the wai?' Suddenly, each gbvernmcnt government employees dici a I ,,W1at can I do to be st 6elp win tl-re war?' tn the war with lraq, Tons of mzrterial ald thousarlcl> : of things very qurckly, very efficiently, and very effectively. Pttgc 6 Robert D. Behtr: Bottom-Line Governtnent people were nrovecl half-rvay around tl"re globe itr a matter of rveeks. Why? essential to tl-tc very cle:Lr goal clf winning tlte rvarr. Because this rvas "War "War 'Ihat on Drllgs.' tltr Prlverty" or a is rvfiy politic:rl icarders c]'roosc t.o lzrtrnch zt 'fltey',v1pt But sirnply rlelclrtring intclligcnce. trncl cllcrgy thc s:rme to nrobilizc zrnclc.onccntratc hzN'tt to clellncl is. Yol,l r'vhat'"vitrnil'tg clc{lnc hzrvc to You enough. 1\vAr o1 porrcrtv <lr clnrgs is nclt "War Rcagan and Gcorg(' llclnerlcl ancl I)o'"'ertY" ott win his to lailccl arbottonr lirrc-. Lynclon,Johrrson "War it' goirl to definc a specif prcsiclcnts failccl thersc bcczruse on I)ntgs" IlrrsS ftrilccl to rvil tl'reir tltcv lbr dcciding whzrt tlasis u<l c'lear -,vafrriors it:rcl rvttrriors tl"tcir rcsrrlt, As n tcl zrchicvc. fclr their <'oulcl victclrics tl'tcy rn'irt, zttty tlrcv coulcl erny bat.tles itzrvc rvarriors sl-roukl do. Neiilrcr clicl thcse cleclare. Withclut clczrr gozrls, it rvzrsclifficult trl nrcasrrrc suCcctssrlr to rnrtbilize ancl c:rlrl<lcrttr:rtcl peoplc's ctnergics ancl intelligencc on nchieving thztt sttt.r'css. Thc sanre was trtre lilr thc warr in Victnanr -- lhe rnilitary equivalcnt clf thc War on [rovcrtv or thc Warr o1 D1rgs. Wl13t exactly wits thc mission'/ Winning thc hettrts and rninds of tilc pcoplc? Whnt cxitc:tly wcrc thc gonls we used to rttcitsure progress towards tl-ris Vietllmesc 1'Irc bgcly ggrrpt'/ ht traclitionul wars, progrcss is ntcastrrccl by land tlzrpturcd. If your r'issiol'/ front movcs fonv:rrcl voll alretrvinning; if yrntr liont ntoves tralt.kwarcls vott al'e losing. Very sinrplc. l]rrt in Vietniun tlterc rvas n<t liont. So it was clil-flc:ultto rncttsttre progress. Tl-tus, itt an ellilrl trr sorncr waly to clcnrortstrlrte tlttrl ttur militerry wzrs tttrtkirlg prorriclc soltrc ltrczrsrrrc of s1(.ccss , c'orrnl. No u'onclcr Scnzrtor Aikcn suggcstecl th:lt rve sinlllly boclv thc invcntccl somLrorrLr progrcss no onc hacl clcl'incc1rvhzrt vitttculrrvrltrlcl be, it rvortlcl llc Ilcr':rusrlrornc. .1.,.i,ar" rrictory:urcl conrc v i ( ' t o n ' h a c l n c v c r b c c n c l c f i n e c l ,i t w i t s c q u a l l y l o g i c ' a l g i v c n t h a t I r i t l c e c l , qritc easy to ilcclirrc it.. tlt'llievccl. bcctr to oroclarinr tltat it lrtr.cl Mission and Goals: Choosing a Bottom Line .fhc spccific irrclex of srrcctcsstcl ltr: rrsecl as ir ltottorn linc is lcss import:rnt tharr trctrlailv bc choosing somc inclex ,- inclcccl, almost arry inck'-r. Alicr iLll, the ltclttont linc can trlrvzrys pcrnriulellt' its oll-jectivcs keeps Il('\'cr llutl busittcss A be chnngecl. cltalgeci. I1 lnct, it. shoulcl collcctccl. A government .gen(:)r shoulcl not clo su r:ithr:r. As I)rogl'css is trtatlc ittrcl rtcrv itrforrrtatitltr ' btltlonr lirie thcir nrodily ngency lcacletrsr'vili neccl to -- sortre kirlcl Still, you have to starrt sonrcrvht:re. So y<trrnri.qht lrs $'cll c'liOos0sotlcthing Fixiltg l50 of goal -- tSrit is relnti1,criy,rasy to acl'ricvc anrl t'ill nt:tkc sctts(' to il lot ol-lleo1lle. p o illts:rrt'irll l l y 2 5 s ( ' o r c s r t ' l t c l i t t { r u i s i n { < : h i l c l r c n , p r c s c : h o o l 5 O O O rr's.le briclgcs,ilrnrulizilg g tlals rlright o t h c r S t r r c : c l t r i t t ' c l o t r l l l t ' ) . l o o k a t l c i t s t , ( a r n c l t w o . l l r s t g o a l s t h c perfcctly r.is,lnble inrPror''ing kicls, tlr inutttttrizittq lrriclgcs. rrnsirli' fixinrl <lppost' will who But i,r.rr" r, 5igler prigrity. trolllesrtc'h aSi-rinst t<t clo battlc u'rttrt. rtot rvill nran:rilcr ovcrlrczrcl triclc-bouncl rc^cli.g. br,"1 ll-rc public pllrposcs. ttcxt A f t c r t l - r cs t a L e l r a t r s p g r t z t t i < t nc k : p a r . t n r c r rtti r t ' s t l r o s c 1 5 0 L l r i c l g c s ,w l r a t s l t o t t l t l i t c l o il-tht' \vhilc. a allcr llrrt tltc statc. in lrririgcs rrrrsirllst l50 nexl ther llx it sl-rclulcl 'c:rr./ Maybc ptadcrs of the transprtrtatiol clcpsrtnrcnt rtre altlc to cortt'ittcrcpcrttlllt:that rrnsale briclgt:s llrc a thc tle<'t'sstln' nr:tjclr problcrn ,- iithcy are altlc tcl getntratc llrc rrt'r'cssilly rcsollrccs trtrclntobilizc dLll)cli(ls zrtrsrver Tltc do thcrr'/ they slrouicl ,wlrat briclgcs. of urrsal'c out nrn will they pe-ison'el problenrs arc. its biggest rvhat tttlcl clcpttrtrtrcnt trzrnsportution t5e cll itpol lhe rnission s F-ixing rrnsirfe briclgcs 1rlkcs sensc ltr:r'zrtrscpart ol- thc transpclrtution clt:llitrttttt'trt l)i.qll\\'iivs' 'rission is to eltsure that. thc citizens of thc sttrtc arc safe wllile trar,'cllin{ olr thcir rtttsitli' Vt'rt' <lf nttnrber largc hers a state if the Ancl this. about controvrtrsy nruch not There is it'sorll('olr(briclges, and, particularly, if orie of tlicse briclges has colla.psed recently, ancl. r'ertainly, Robert D. Behn: l:':tgt' , Bottom-Line Government died as a result of this collapse, the leaders of the transportation department will not face it v.r-, large challenge in nrobilizing the resources and people necessary to fix all these unsaf-c britlt, Alter thc bridges are all flxed, however, there may exist no new crisis -- no obvious litrlr::' that meshes rn'ellwith an uncontroversial aspect of the department's mission and thtts tll;tt t ,,: . jr:-' be usecl to rlobilize resourcres and energies. But perhaps therc is a clue herer. Maybc tl.' A n c l m a y b e j u s t m a y b c a l o t o l n r e r y b e - - s a f e t y i s t l - r e k e y .W 1 ' r o c a n b e a g a i n s t s a f e t y ? Maybc rtlttki:.r name of safcty. in thc be llxcd deficicncies of the state's transport.artion system can rural roacls safer will zrlso give farrmcrs better acccss to markets. Maybe making major ill-l('t.., highways safer will :rlso give thc state's rnanufncturcrs better access to thcir tnarkcts. Nlrr"' { : metking local streets sal-erwill improve the state's cclmntunitics and rerise real cstzrte 11211111': ,,1 .'atspclt on the economic-development to focus nraybc the transportation dcpartrnent ought purstri' |;r,:: c:tn simultaneously department mission. Or ma1'be the leardcrsof the transportation salcty ald cconomic devclopment. Regarcllcss of the aspect (clraspects) of thcir nlission rltl ri']ltr :. -- against utit ]r ' tftey cftoose to focus, they will necd to select a bottom line -- a specific goal measllre progress. Convcrsely, the bottom line hets to relatc to the mission. The mission of any pttblir' :lq('lr( . is icleslistic. lL is clcsigned to inspirc. And thus it will also bc vaguc ancl ephemcretl. Mort'or, : ' it will not nccessarily bet obvious how to achicve it; incleed, it rnay bc irnpclssible to ever it<'ltlt it. Thartisrvhy:rbottomlineisrcquired--anannuillbottomline,pcrhapscvcnzrmontlth'lrrt11,::. lile. For that is thc only w:ry that the agcncy c:ln nteasllrc progress. Ilut that prclgrt'ss llrr:-' erlways be clcarly clirected towarcls achieving the missiot-t. Using the body count as ttrc botton linc irr Vietnirnt iv:ts il firilttrc lloth to tl-rink tlttoll-: t6e mission arnd to clevclop a proper goal. What cx:rctly rvtrs t.lte tnission of Unitccl Staltt's lrrl t . rtttl,' itllcl hczrrl.s to win the trying we rcally Werc in Vietnam'i What \L/crewc trying Lo alhicve'/ s I . i ' progress 1,r.,'11111 goocl to nlcastlre way u of the Vietnanrese pe oplc'/ If so, was tl-rcbocly corrrtt goal/ Clcarly not. Because it wirs difficult frrr occiclcntais to clistinguish belwectr \i,:': Vigtnamcse ancl South Victnarlcse, bctween Vict Cclnfl ernclsolcliers of the Republic of \/it'ttt,':r. thcre'uvcre many obvicxrs u'arys to increasc thc bocly cottnt while sinrultaneously hr.rrtutrl ll.' nrission. Was winning ttre ire:rrts ancl nrincls ol-the Victnamese pcople thc right rlrissiotl Iirr'': ' United States rnilitary'/ | do nol know. IJuL if this u'tts the propcr nlission, I tlo ktrow tllitl l: body count was not a uscful wily to neasure progress towtrrds archicving that n-rissitnt. For l:. nrilita.ry in Vietnam, thc body count was not an appropriate bottonr litre. I-ittle woncler that General Colin L. Powcll, Jr., forrncr chtrirnran of thc.loint chiet! ol.s1.r:: ' wants the nation's political lcarclership to establish a clcar goal belorc conrmitting the' ntilitrrrr combat. If the nrilita.ry is going to fight, f'crwell wants iL to lig]rt a reral wiu- rvith il s1)('(r:. measurable objectivc -- not sonre kincl of ersatz war like tt Watr cln l'overty. 'lhis "Powell -- itr li't lt r , Rule" sl"roulclapply to clomestic policy as wcll: If a pr.rblic agt'ncy ( statc, or loczrl government -- is askecl to arttatcka pa.rticular problcnr, it ought to be givctr li l(.,: t"'., tllt' victories along intcnnecliatte sorne what are is, ancl goal; it ought to know what winning l:.' agetrc'r. goal the for :r to cstzrblish ftrils cxecutive electecl if tn" legislative branch or thc --one. publicly announce and create agency's appointcd leaclership sl-rould Adjusting the Bottom Line Achieving a simple, first-year bottom line of, for example, fixing l50 unsafe bridge's lrL:''' time with which to produce more significant accomplishments. In the private sector, change' t.tk' Robert D. Behn: Bottom-Line Government Page B time -- a long time. Corporations do not remake themselves overnight -- even over a year. Sonretimes it takes a decacle -- or decades. In the public sector, by contrast, the demand is for instantaneous results. If the highways are unsafe we want them fixed -- now, today, certainly this vear. We clo not want to wait. We do not want any more people killed. We want safe highways. Norv! That, of course, is inrpossible. (Andwe all knorvit.) Ourpolitic:ll rhetoric aside, whatu'e "Show us some progress. Prove that yoll can do it. Making sonre rvould really like is progress: " progress this year suggests that your agency can make more next year. So fixing I 5O briclges this yenr buys tl-re time necessary to do sornething more significzrnt -- to really figure out how to reduce traffic deaths. Fixing unsafe briclges is, of course, not an end in itself. We want the bridges fixed because rve believe that ii they are not fixed someone or some group may get seriously hurt or killed at one or nlore of these bridges. We cannot be sure that, if the bridges are not fixed, someone will be killecl. We cannot be surc that, if the briclges are fixed, no one will be killed. We want the br:iclges m:rde saf-er because we think that will reduce the chzrnces that someone is kille d. F ixing uns:tfe briclges is just an input for producing the output of prevcnling deaths. Initially, however, Lhinking about prcventing dcaths may be too big a step for an organization that has become erccustonrecl to following, crarefully, all the civil-engineering rules. Consequently, fixing unszrl-c bridges m:ry be an important first step, {or it zrccomplishes tvu'o organizational purposes. First, it gcts pcople ir-r the orgzrnization accustomed to thinkir-rg arr-rcl producing in terms of a bott.om line. Ser:oncl.it gets thenr thinking that somehow that bottonr line ought to be associatecl with szrf'ety.(Jf course, all tl-rosecivil-cngineering rules were based, at letrst in part, on safety considcrations. But tl-tosc considerations about safety were buried uncler thc rules. Achieving safety was not important. Following the rules wars. trventually, the leaclership of the highway department will want to connect lts bottont line tnorc clirectly to its mission. Somc timc in the future, it will want its bottom line to bc: Ncxt year, keep highway fatalities under 9OO. Whenever thc le adership of a gor.'ernrnentagcncy initi:rtes bottom-line management, it r,vill rvernt to start with somcthing sinrplc -- something thzrt catr be zrchieved. Il will rvant to follow Karl "stralegy of srrrall rvins": Pick a gr-raland erchierreit. Lcatrn from that achievenretrt:rrlcl Weick's creatc a sense of nccornplislrurent. Then pick a slightly tottgher zrnd morc signilicant goal; zrchievc: it. Learn more and build the psycl-rologl of accomplishrnent. Continue the cyclc. Ancl move tht-goal closer to the org:rnization's rcal purpose, its rcal rnission. Bottom-Line Government Requires Leadership Kceping highway cleaths unclcr 9OO is clearly a rnucl-r more ambitious bottonr lir-re. Norv fixing unsafe bridges, dangerous curves, ancl blind intersections will not autornaticzrlly trchicve tl-rcr bottom line. Civil cnginecring will not nccessarily :rchicve the nerr,'bottonr linc. Because al rcccssion increases the consunption t-rfalcohol -- and thus increases tlte number of drunk clrirrers on the highways -- the civil-enginecring improvements may acconrplish little. Higl-rway clcatl'rs uray still go up (or at least not go down). Thus, shifting the transportation department's annual bottom line lronr'lix l50 ttnserfe ' "keep highway fatalities undcr 9OO" changes the basic nature of the organizartion trnd bridges to needed to make the org:rnization successful. Civil engineering is still necessern': the kind of skills dangerous curves, and blind intersections still need to be reclesigned :rnd lirecl. trnsafe bridges, Robert D. Behn: Bottom-Line Government But civil engineering is no longer sufficient. they only help achieve the bottom line' i '- Engineering fixes are no longer the bottonr litr' ' : ' "'" t,t: ' ."' If next year's bottom line for the transportation department is to keep highu'av -$-r'. :. ' -- indeed, the entire department's pcrsonnel belowgOO, thedepartment's leadership to think differentlY. \ ' ' Even when wearing their civil engineering hat, they will have to think clifferentlr' '' (or thc highway cuclt-:l -.' engineering question no longer is: What bridges do the text books : ;:. r:onclitiritthighway unsafest the are What be: must unsafe? Now the engineering question '. : it:' last vcil| deaths most to the -that contributed what are the highway conditions state -- and how can we modifu t'hese coltcliti :'likely to contribute to the nrirst cleaths this year and the highway codes have nothitri : textbooks If the reduce the probability of dcath? ' int.crsection ovcr thc last rlci'rirl' particular a at about why lhere havl been nine deaths ' "We'vc done everything" Now even'r)ll(' ::' transportation departrnent can no longer say, .'-'' -will be c:har{t''l clepartrnent -- from the planning division to the local district workers intersection. that cleveloping icleas for reducing cleaths at nine cleiiti civil engineering, however, may not provide tlte answer. Maybe those -- after high-school footballl games. Maybe the way to pr.' ' : occurred latc on fall Friiay nights ': night gamcs (botlr Ir" those clcaths is to post a tretffic cop irt that intersection after arll Friday the interserltion aftcr 1r' and basketball) . Maybe the vu,:lyto prevent those deaths is to close 'leaving thc pitrkrr:trafic the reroute to is deaths games. Maybe the way to prcvent ihose -, is to tightly cnforcc tlrt' after t5ose football gori,"". Maybe the way to prcvent Lhose deaths interse ction erftcr itll i': . : ' rat tl and stadium football limit along the strcich of roarclbetwcen the prevent thosc cleatlr- :- :' can clepartment Maybe the rvay that the transportation night gu-"". . -governillcllt rri':' another perhaps else by-cloilg something itself but by getting someone -- to do something. plrfraps sonte privite inclivicluals or organizations line for the tratlslltrtl '' : Establishing the number of highway cleaths as a bottom tl-rat they do not irrI' : .: things for rcsponsiblc clepartrne.t holcls thc letrclcrs of that department Getting the cirril etl{illt ':': ' not clirectly control. Thus, it requires them tocxercise leadership. line is connectccl to its I :. right is no lolgcr aclequarte. The more directly the agency's bottom line all by itself' bottom its realize to able be overall mission, the less thc agency will fatalitics. it rvrll : ' If Lhe transportation department's bottom line is to recluce highway police departments to $ellcriltr to work with the state highwzry patrol and with local may have to work with ltlc'itl -' :. ' They a deterrent. of enforcement activities that are more -' Drunk Driving to improve tllt' L:: officials and private organizations such as Mothers Against They may have to $',t'k ' "' to eclucate teenagers ibout the consequences of drunk clriving. --- both public and privatc to reduce the dysfunctiotr'iL :l social-scrvice organizations They may have to work $'iti' accident-prone behavior that results from job layoffs. manufacturersofautonrobilestoimprovethesafetyofsuchvehiclesorlobbythelegislatttrt': thc data about the c'rttt:'.quire more safety devices. They will certainly have to analyze not merely the cicllt'it':' identify to seeking perspective-highway accidents from a different contributors to lli-::"'' ' bipgest the are that factors the but ln'nignways that cause acciclents leadership will have to figurc otrl "r' accidents whatever they may be. Then, the clepartment's 'l department, ctlll {t'i is best able to ch:rnge tirose factors and how they, in the transportation key people to make ihose key changes. That requires leadership. Robert D. Behn: page lO Bottom-Line Government Bottom-Line Management Is Unfair But holding an organization and its leaders responsible for something that can only be achieved by others is, the public manager will argue, untair: "Horv can I, as the head of the state transportation department be held accountable for the actions (or non-actions) of the state policc, scl-toolprinciples, private social-service agencies, automobile manufacturers, and the legislature?" All bottom lines are unfair. The chief executive officer of a widget firm is held accountable not only for the elliciency of the firm's own manufacturing plants. That CEO is also hclcl zrccountable for the clevcrness of the firm's advcrtising agency, for the competence of the firm's transportation contractors, and for the placement choices of thousands of independent ret:rilers across the country who actuarlly sell the firm's proclucts. The firnr only makes the widgets. It cloes not advertise them, tralsport them to mzrrket, or aclually sell thenr to consumers. Ncvertheless, the firm's bottom linc -- the bottom line forwhich the CtrO is responsible -- depends not just on manufacturing; it also depends upon aclvertising, transportation, and rctailing, none of which tl-re CEO (or anyone in the firm) controls directly. If the advertising :rgency produces a serics of commercials that fail to interest consuners in wiclgcts, the CEO can always fire thzrt ad agcncv and get a new one. But meanwhile, it terkes two years for the firm's bottr-rm line to recovcr from these disastrous commercials; for that, thc CEO is held directly responsiblc. The man:rger of :r McDonald's franchisc is held responsible for the cle:rnlincss of his rcstaurant. He is also held responsible for the clczrnliness of his pzrrking lot ancl of the sidcw:rlk in front of his restaurant. The manager of a McDonalcl's franchise is even held responsible lbr tl-re cleanliness of the sidewalk of the entirc block on which his restaurant is located. McDonalcl's has concluded that the guarantee of cleanliness (ancl, tl-rus, indirectly of safety) helps persuacle pe<-rplc -- particularly, people with small children -- that it is always perfcctly s:rfe to stop and eatt at an17 McDonald's. Indeed, the bottom line for an individual McDonarld's restaurant is not its fina.nci:rl bottonr line. If the regional office did its site-location analysis properly (zrr-rdMcDonald's docrs vc-ry sophisticated site-location analysis), any rcstzrurant should achieve its finerncial targets il'it achieves its othcr bottom lines, such as short waiting times, hot food itcrns, and friendly servir:e. Moveover, if the managcr of the local franchise achieves thesc non-financial bottom lines, that manager contributes to thc profit of not just his rcstaurantbut o[the entire McDonalcl's chzrin. Consequently, a representalive from a McDonald's rcgional oflice who makes periodic inspcctions rates the cleanliness of the inside of the restaurant, the cleanliness of the outsicle of tht: restaurant, and the cleanliness of tl-re entire block. All bott<,rm lines irre unfair. Rcal bottorn lincs -- thosc most clirectly connected to ttrc mission of the organization -- cannot be achievcd by the organization alone. That is r,vhy bottom-line government requires leadership. The Ethics of Choosing a Bottom Line kadership is also required in selecting the bottom line. For any government agencv, rvhzrt this year's bottom line should be is not obvious. The agency's legislative mandate may of-fer sonrc guidance. Usually, however, the preamble to an agency's authorizing legislation is ambiguous anci contradictory. Indeed, this is necessarily so. To get the legislature to enact the authorizin{ lcgislation -- to put together a majority coalition willing to vote for the legislation -- requires c'ompromise. Some legislators and some constituents want to accomplish one purpose. Other legislators and other constituents seek a different purpose. Still others want to pursue otirer purposes. These purposes may not have all been directly contradictory. But they were diffcrent. furd choosing among these purposes -- even establishing a hierarchy of these purposes -- can Robert D. tsehn: FSottom-Line Govertlment l:" :'" ='\' -' cause defectionsliom ttre legisl:rtivecoalition. Consequently'to creill(' -- and certainly tht' i'"' :'' -' r :-i:r rI legislative leerriersi-lipsleavs the exact purposes :"{-' h{trr;:* purposes -- p,-,rpur..iirllyvague. Then, all legislators voting for the le'gisl'rl:'.'.': :r*r{ legisl:rtiott the tl-r:rt constituents Fr.-r rcspective not clisl.ro'"ittvi rcport to tlreir thcir pirrticttlltt' cottstilllcnts' pllrposcs' ' : r "h The resulting legislation, however, will hardly provide dcfinitive $uicl;rrrr zrsk the agctl( " Fl manrlger. with so -nt'ry purposes to pursue, the manager nlay " l^ ' r mrlt with * purpose particttlar no pursue will the m, rvhich nleauts tn:ri ttre agerlcy '':-'i -t't't.l but nothing' not maybc rvell, up doing encls to clo errcrything, the agency -orchestrate a PI-(( ' \'i Thus. the task of the agency's leaclership is to clccicle rlr '' -- what its bottom linc rvill be. As suggcstcr(l attove, artrirlititrl bottonr line ougllt t' simple ancl nonconrrovcrsial: {ixing l50 trrtsatcbrirlgcs: ilrtrtturtizin{u:999ti:;tt)]::.' :, s('or('slrr,25 points. Wl.rorur.nbc ttsainstthese goals/ Clerl-r-::hil,.'J",;;i"ira,.oaisg . c c o u l d b e q u e s t i o n s o f p r i o r i t i c s : S h o t t l c l u ' c f i x t r n s z r l - e b r i d g c s : . . , " : a l " . $'t t l 1iiil: l i . i _:] f t . l l l l ' : , . percenlzrgc of lo$'-birtll we vaccinate chilclreri aglirrst nrcarsles or recluce the c o n c l u c l i n g t l r a t t l ' r c i r l i t i l t l l-llo' 1t t o r t t l i l l ' . - t : ' - ; r f l Shouldweraisercaclingi"u.,'rornrathscorcs? l' t lr''rr' I ' :"i-€ be simple and 'oncontror.crsi:rl ciocsnot preclude a dcl;irtc'ovt'r 1lt'itlt'llit's ' " ::": ' ':"'' -thirn lo{it '\i'lllt "'l '' b o t t o m l i n e s w i l l l l c t r r b i t r a t . r ' i l t t s e c lo n v a l u e s r e r t h e r actlttrllr'llit'kitt1 "::' agcncy shoulcl t[, t0 lrclricl'c is lcss inlportant than y e t , i s t h c c l r o i c c 0 l ' t h c b o t t o m l i n e f o r e r s t z r t e t r i l l l s p o r t i l l l ( t l l . , - ' l - '" -- So open to itrllttt'ltt t' : '' clepartmcnt, of 2l st'}t()O1rt-allv so arbitrary the accompall!'iIl{ llollr':l: ^:: organiz:rtion,s lcsclcrship'7 ls not the mission zrnd e r I l ' V z r i l lo f G e o r g e \ \ ' i t s l t t t l ' i " : : ' : " : ' ' : : t ' : - ' I r r l t i s l r r t r l k . J l c t r t c r - q i rat g- sa P e r f o r m t r g A r t , " pPeer tm ancnt white watcr'" Nlrlst 1lt'r'lt't 1-"'.' : w r i t e s : r b ' r . r t t h c r . l r a r l l c r t g co i ' r : i n . g i n g t h r o u g h is like canoeing otl a lerkt' .tl ll'r: "'' :" 1 mzr.nurgenrert.rlrqges Varill, ersstrtnethal r,t,.r.,:ig"ttt"nt tilt' tttrlltllt:''' - - w i t l - r o r l ' o ( . c z r s r o ' a r il n t c r r u p t i o n s o f t u r b u l c n c e . l n r e i l l i t y , h e a r g u e s , in nn interrtrnticlnztlec'tltrottlr" 'r:'::. pervasive. certainly, tl-ris is trub forbusiness manelgcnrcnt : c a n n o t s i r n p l ' c t c ' c l o p i t s p r o d u c t l i n e , s e t u p i t s m a n u t a c t r r r i n g f a t l i l i t i c s ' a n d o p t ' r i l t . r 'ol 1 "t'r:r : : --' lorrlt thc in permanrnt rvhitc rvater reckoning for il-rc next clecade. Rather, Lhe firm faces ancl chcap oversetls ('ollll)t'iill :. technoltlgies, Ifew preferences, 'r' shocks. <therngcsin consunler watLtr els ncrw environntental probicrtls ll Similzrrly, ptrblic managcrs lerce permanent whitc trrrbuletrce for Lhc public agency' econonric sh<lcks, trnd nc'uvcitizcn clenrancls creatc ,,winning iS tl"re only thin{ r writes Vaill' Arrd, ir.r this world of permanent white water, t':' winning? Does .ot whomever has the higl-tcst st think wi.ning is." But is not winning simply winning: is not easy to define win? Yet, even lbr ar sports team, a,rgues Vaill, it rne th:rt one of the coacl-t's key A former college baskctball coach once told in thc strnle wily' For some' problems is tolet all the plaryers to clefi'e'wi'ning' winning"o'',.',"o,.alwaysbeingwillingtoplayhurt;|orothers.itcannlean in starting I:rst and hanging never playing hurt. where one ptoy"t may believe game trnd go all out at the cnd' For on, another will take it easy eilrly-in the challenge; for anothcr' the one, each game can be zrn individual freeitancling challengeisaseriesofgames,orevenawlroleSeason.sonreplayersregardall zrre ntrtch tnore import:rnt thatr opponents equally; for 6thers, some opponeuts 'winning"' others isn't really other opponents,-and winning against one of the Robert D. Behn: Bottoqll-ltre Government Page 12 If the definition of winning can slide around in the minds of the members of a sports team, this is nothing compared to the diversity of thinking one can find in a typical work organization. 'the Indeecl, if definition of winning is open" for a sports team, how unsettled is the definition u.inning -- the definition of success -- for a public agency? of Consequently, the task of leadership is to get everyone using the same definition of 'getting u,.inning -- the same bottom line. Leadership, Vaill writes. is everybody on the same wavc length regarding what winning is going to nrean for the team and keeping them there." This is 'thinks winninq is drives action on a bcr:ause, continues Vzrill, what an organization " nrinute-to-minute basis. It is not unfair, presumptuous, or unethical for the leaders of a public agency to choose a particular definition of winning. Rathcr, il is essential. Getting thc agency to define a specific ltottom line, and keeping the agency focused on achieving it, is a necessary task of public leadership. The Bottom Line and Organizational Culture Internally, the leaclershipseeksto createan organizationalculture -- a culture that reflects pursues the organization'smission and associtrtedbottom line. Any:rgency's top managers zrnd job themselves. They czrnnotachievcthc ergency's mission singlehandeclly.Nor cnn the cannot do what Rzrthcr, they need to do -- what their bottom linc by themselves. realize the agency's tl'rcy intcrnal leadership is all about -- is to get everyonewithin the organization thinking erboutl-tow they and their unit can best help the agency achieve its spccific bottom line and rcalize its mission. At the Massachusetts Deparrtmentof Revenue,Commissioner lra Jackson defined a very specific bottom line for the clivision thirt proccsscd tax returns. In January 1985, on the front page of the state's 1984 income t:rx fomr, Jackson's letter statcd: If we owe you a refund, please do yourself a favor and get your return in as soon as possible. Early filers get quicker refunds. It's your money and we want to get it back in to your hands just as soon as possible. Here'sour pledge: if you send us an error-free return by early March -- we will rcfund the money we owe you in four weeks or less. Th:rt bottom line was certainly not written into the revenuc dep:rrttnent's authorizing legislalion. Yet it was clearly within the spirit of agency's mandate. Moreover, that bottom line was simple and achievable. How cliclJackson know that l'tis atgency could achieve the four-week turn-around? He did not know for sure. There was no analysis available to tell him what the processing division could do. In fact, there was not even enough data around from previous years to do such an emalysis. So, Jackson simply asked George Osganian how fast his division could turn around the refunds. Osganian replied: fcrur rveeks until mid-March. So that was the bottom line that went on the tax forms. Creating the bottom line of a four-week refund accomplished a lot of internal purposcs. First, it motivated the people who worked for the processing division. Here was an organizatiotr that was only recognized when it made mistakes -- when it lost a tax returrr, sent back the \\'rong refund, or violated some rule. Now the processing division actually had something positive to achieve -- a bottom line to meet. For two-and-a-half months, the processing division rvas the Page 13 Robert D. Behn: c e n t e r o f t l , r e c l e p z r r t . m e - n t ' s a l t e n t i o n . s u d d e n l y , t h e l , ' \ \ ' Ls= - .r C ,i{"i:l: rJ r. , r (- i--- -..t:':i4 :. r. r ", praise in the-pre ' ll ;:-' r ' ' Deoplervho rvere earning the clepartment ':t"::" :::': lhi rvh^t of proud because il'ri";o.1",'-,"r.,f or n"""nue, you were accomPlishing :}-* ':":''' beyortcl $'i:'': :: crd h important was relund Br.rt t'e {bur-week [8 ..it . '. im- d 111,J;1.-: agency 1y21.s, his for nission Jacksotr's "treert titrp'I\'t':t 'rs r-tld (ffiir reputzrtion arrcl morale. clbjectives was to tration,,, and one ot his subsidierry lr ;r:i.. 5 rit.;-...:ffi tllat objective. lndeed, rvhetr thc four-week refund rcenlbrced announC]eIrrentsaucltrtlrorvnrernyfotri-weckreftrndsitlrzrrl"]'l:1l1i']::]:::.1*'q;': iii':iiH:r':ff'#:::;:l''...':,..":;9;';'''.Usirrgt'hefclur-u,et'krt'il::::i.a:l*$:r: :'i'\}-ftilI|ill-] of thc revenue ilepartment lo tr('ill reorient the organrz-aunn.r culture What Is Broken? ift* What Needs Fixing? How.does it clcciclcl:ll'l]-.'l ' How does a governrncnt agency improve? itlr'i''' llne, it is impossible to conduc'tartrtnccclsfidng? Witno|t. clear botiom or effectiveness' lnouta clo to improve its cfficiency ;;;"y gor't'l.IlI]]' :.. .. .. ' :*.r -.',r' Sophisticated bottonr lirrtls. By creating erseries of suctlceclingly ' :' r --:--?rF learn arnclimpr.r'c. r\rr iriil''. ttre orglnizntio' .,or.,. r l r l l ' ' : ' : " ' create an environmci.rt i' rv'ich thinkirl{ trnsafe uriclges)starts the orgatrization botton llne (e.s.. Iixing 15O F u r t h e r , i t p r o v i d e s t r b a s i s f o r c o l l e c t i n g d a t a i r n d .dccrease e v a l u a t i rat r $ t'c t l t t t r150 . t l r tlrrrti*' t t ' - , I l ]- ' .". - ' 1' . _ ;Y:r r..4r y"ore'biatn"y go down'-ti" r": re:rlly r--' lr. ('ilr ir"' r'r' \\-(' accidents and deaths uridgesz what unfixect and l5o.rtrrir" at ' '\ t: fixed? Dicl thcv arso clecrcase next ycirr'/ Sh.trltl "r'.r i should our bottotn line be for 1 : . . . first year's bottom r,ri"z wr.ot or speleclirr{.,,()l-\i)1,' - ... intersections, or sclrool CroSSir}gS, : : :' : unsafe briclges, or unsafc our highway safi'tV S\'\1r'ill :clriving, oi'wnatz What about rnile-per-l-rour zones, or clru'k ancl needs fixing? B t r t t h c a n a l y s i s i s r r o t c l o n e s o l c l y | r o m a b s t r orgernization a c t d a t a o r s o to l e l yarcrriel'f b y t l r e i tirS t l l tltr.,' l r . t l - ::i 1 . .".: "pon the eiforts of thc : the arnalysr" o.o.*'rilrrrf illitnilg('rr1('i.' t'e fecl back into ' of 1t-,ut u'r,.tlrir "." quickly irt'lrrr'" t. Moreover, lhe implications the types oiarctivitics it uncrcrtarkes iirr"lrira __ ti.ewbotto', into organization *-itlr tll( ::' -' be clcl.e by a'arlysts'uvorki.g nc-crcssarily, must. analysis some of 'ris *'lrtt'1r irr':-'most dangerous oeclair-rj*rrl"r-, briclgcs arc trctrris 'r- "i ' aud comprehcn"i,re aaia avaiiaulc. u.riily"". of past accidents "ffirsticateo -"o-" requires shoulcl be fixcd rirst as of bridge characteristics' fixirrq tht' i'rr-r'1-'ficld by thc peroplcwho erreactr.rzrily the irr clone are analyses Ifut other and narrow [artrclthtts tirr>'ri this'ld ."pu.t uocr. tnai-tr]ey "o'-' briirg They may, ro. ""-rpi'", zrlthough tilc t1('('i(it':': not eliminate accidents' For "ray '"puit" ".t"t tr tt'toL : U.it bridge up to cocle, by the sharp curves otr eit'tr appear, lniact' to be causecl occur at the bridge, theywould ofthebridge.Donotjustwiclenthebridge,theyargue;straightentlreroadtoo' Eventhoseenployeeswtroarefixirrgthebrirlgesrre e d t o u nup c l et.r s tmodern a r r d w h y .civil-engitreert::* Thevl](.t.(l briclge 'trris^year's job is ,rot "1-pry-io ilr-g,tiie line may rvell l'' understand that. their bottom " th" uridge sate. mnt to ls real;ob their st^tt'standards. Rather, p# of a larger mission: making the il;;;;"ilr only to l''' to repair tso unsafe bridges. B"t t."t "portation iepartment need not "-t.t" the of i;;;aders ;; to be explairrirrhighways safe. ortni" year,sbottom line; ihey also need reminding everyonein the departmeni Robert D. Behn: Bottom-Line Government Page 14 thc underlying mission -- the real purpose of improving safety that the organization is seeking to :rchieve. For both the specific goals and overall mission provide a basis for deciding which of all the clepartrnent's ac'tivities, from arnongst all the things that are broken or worn out, most need to be fixecl. Indeecl, one of the things that muy nrost neecl to be fixed is the goirl. What are the most inrportant tl-rings to clo to improve safety? The answer to this question requires all kinds ol-clatir -- nlore than the annu:rl statistics on l'righway fatalitics, more than the clisaggyegated statistics on highway l:rtalities. Sclccting next ycnr's safcty goal rcquircs feedback lrom this year's safety efforts. What works ancl what does not'/ What a.re the biggest causes of accidcnts? Should rr'e trttack these? Or arc thcre sonre big problems for which our efforts have been dramaticzr.lly Llrlslrccessful, suggcsting that, for ncxt yczrr zrt Ieast, we ought to focus on sonle smaller problcrns ilgainst rvhich we cern rnake progress whilc rve try to learn morc about the big problems? "nranagement by groping zrlong." Do the cloable firsl. Set some simplc, I have callecl this 'fhen, as ezrrly t.argets. Get tl-re program up and n.rnning. Try to leam fronr these initial efforts. you nrzrke progrcss, set new goals arnd try to achieve them. Learn tlorn this revised effort. Reacljust your goals (and naybe your mission too) and again pursue your ncw target. Continue setting ncw goais, inrproving organizational performance, and reacllusting goals so as to continuously increasc your ability to achieve your mission. Management by groping along requires a bottom line. Without a tnission eud witltout goals, public leaclcrs cannot decicle in wl-rich dircction to grope. Without a bottom line, these leaders cernnot decicle rvhich gropes have proven liuitltl and which have trot. Without a bottom line, public agcncies czrnnot nrakc progress. Without zrbottom line, political leaders cannot prove that thery havc improvcd the perfonnzrnce ol-govcrnnrent agencics. What It Takes To Make Bottom-Line Government Work Under what circunrstances can t.l.rchcacl ol-a ptrblic agency usc bottom-line maneulerlt(lnt to intprovc the agcncy's perlormance? ln perrticular, cern this bottom linc approach be eft-ectivc only if thc agency hcad clirectly managcs thc people ancl units producing the agency's serlice'/ Can After all, many public scr-vices arc actually providcci by privertc or nonprofit organizations. this bottom-line approerch work in situations that require indircct mantrgcmcnt? To use botton-line mana{.icnlernt to inrprovc t}re perlbrmance of prrblic agcncies, public leaclers must be able to clo tirrcc tlrinfls. Tlrcy rutrst huvc (or tte trblc to r:reate) nreasurtrble, legitirnate gr,rerlsth:rt :rrc rclerteclto thcir orgzrnizulion s nrission. Thcv must be able to publicize widely rvhich units are achieving their goals ancl r,r'hicl-tzrre trot. And tl'rey nrust be ablc to otl'ct' direct assistance to units that are not meeting their goals, providing lltem bclth with the tecrhnitral assistance and the resources necessary to improve pcrfornlance. Goals: First, bottom-linc government requires some kind of bottom line -- some kinci ttfexplicit goal against which to mcasure progress. Such goals must be not only measurable btrt also legitirnate. The perople who must r.vork to achieve an agency's goals, tl-re people rvho uill benefit from the achievement of thc goals, and citizens and taxp:iyers, rvho have an indircc't stakc in the goals, must all think that the goals are justifiable, fair, legal, valid, and reasolrablc. Otherwise, people will seek to undermine the goals rather than achieve them. Further, the goals must be directly related to the organization's nlission; achier.'ing the goals must move the agency closer to achieving its mission. Unfortunatelv, it is ttsuallv impossible to speci$r any agency's ultimate mission in terms of one, measurable goal. That is rvltr' annual adjustments are necessary. Each year, in achieving its goals, the agency should make - Page lir Robert D. Bel'rn: p:os,:":.!nU:U,.1'f:':::'il':#:;:f"rf*:,",:t"1":Jlilill*,3,T1il:'iJ -- ol changc its goal mission' be clirectly relatcd to that I { t l r c a $ c t r c 1 , ' s i r t r t l r t l r i z i r r g l e g i s l a t i o r r o r a p p r o p r i a t i r lis n strre b i l l dclutv.f o e s n o tthe e s t :agcncy's i b l i s h s u cleaclcrslrtr hrirr;L]t has'noi au." ro ei'ier, tiri:'it g.:tls tr': ne' derrelop er'cr if *re :rge.r.y h";:i;lr;;, laril,res' ltom sur:cesses zr.cl learning a'cl, *rrt vc.r tir" lor to clcvclop goals future Ycurrs. P u b l i c i t y : S c c r l r r c l , b o t t o n r - l i t r c n l e r n a r g e n r e nfor-t'e t ^ d c p e rtop r c l serxccutive' o n i n d i r e c t -the - n o tinfluence c l i r e c t - - i nth^t l l u c ' ttl::rt.' organizatio.*;;;t.ijrectly thc in trven if evcrryone is strictly inclirect' t ottom-tinc leacler excrcises R a t h e r t l r e u r s e c k i l r g t o c c l t r t r t l l t h e b t l l r z r r , i c l r o'r^nirger f t h e l p e o seeks p l e a r rto c l motivate u r r i t s r e l sbcrra'r.r' p o n s i l l l t ' l :: gnni, the bottom-liner ,.rra missio' il:' bott.'r elgency,s erchie'ing the for'the efr-er:Livencssof w'o.g ki'd of mcchanisr., the r: * preciscry pr.clrr 's the scr-vices, fact. .ontror wit' crelivering tt,,.-"r"^ti"i;;;;f i!r,o" "r-,"rgecr ':. {ov.*nrent a"p"rr,t=,rpo' r,rr.',.gcmcrltutirizesthe ven'hrirr b.ttornjlir-r., tr-r'.stcncl, gont. tl-re '' : ""' rlchiervirg goverrrnrclll the rcsr.rlts,arld ',l,.r", rrbility to n'rirkebotto'r-linc . .he iry onc,s-peers. well cront'rrri: cresireto be respeclercr visiblr 1r"", npprnrr.l forrv.rk togcner^te lcacler orthe Jiirtv thc up.. clcperncls whcn goals ^rc not met' cliszrppror''al peer ;;;;a" .' ' t nrrtstbe :rblc to nrttkc cltt'li i ll lrelacl agency trrr rrt, nlaniueilte ("r( lr r: ' Tlrtts, to tttiliztl btltttlrrr_line ,f'. bott.o'r-rine'ra'agr:r rr,,,sLbc-^ble to e.s'rc tll'rl g':rls 'isible : t'llt'ir r::.' Drogressrrgerinstits 'lltel bottour-litrc rtlilrt:rgerulttst bc ablc to elrrsttrctirat rilrl' cloing' ii b. it m'st i.t-t,,r"thorv rvell A'ci t'e llotto'r-lint: nr.nager i"tg ^r" u.i1s t'c..ther .11 krrorvs how *,ell ensllrcttrateir..irr',r',,.k,,u*,'thartallthetlthcrtrrritsknowltowrvelliLiscloing. . l . i l : r t , c l o c s t . t o t - r c c l t t i r e l c l i r c c t n r a l r a g c n r c r r t . A l l i , t , l c c l u i r e s i s s c l n rsotnt'titii'-. t'publici|yvehiclt'\':.. ancl tlte progrcs::f ttt"T^p,"ers' ' awalr-:,or!f"ll:,;;;i,grcss 'rivo -way to make cYcryone lists onc listi'g all tit.t' mtrc'than:rcreqrrntc. is onen raireclto'r.l<. tltt'it simprc :rs :, ru.ntirly'cwsletter the other listi'l all t'os.'"vho r,-rnr-rtt-r-orra prcvior_rs lt'.r" marde*re gn,.rtu. and peoplt: to irction' __ciln clo u,oncierslirr rnoving units, m?rnagerrs, " or{atrizltli.tl .fhircl, t'e bottrr'-li'e nranirgernrust be able to olfbr thc Assistance: ttlrclrcsources' -- kDrx'vlcc1gc to inrprtlvc pcrlilrtrliln(le inrportant kincls o1itssiStertrce fir. s.rrrt'{Lrr'l: its go.ls ot1e. 'crrcislittler'r'rc :rchicv. Lo strtrggli'g is rrrat A unit rt-t,.,,oti.nr,rirrc rlran^{cr necclr'. 'crs.rrallv lllt't t: ' rr""rirl,,*rrr,rr. r-rnr],: ir''trt lrorv t. clo it rr ::' frrm t'ose *no n'i,r.,r. I' l^ct, t'c 'icssilge ..,r,rit .a acrl.ricvc to rrow Trrrrs'rlrrc i'rprt.t'rll' : experlisc zr'out bOSsbut lro'r zrsrrc'cr.ssr.r'ecr' thc: lr..m nut ,,,,rner if to-<rrcatctltt:cititttistr:pcrs'asirrc *,n."rr p..r,.i" r,",t;1rl1ltlli's transler.' to i, lnanagcr of thc bottorn,rirle stiirgglirrgcr.lrc.gucs. Such'r.t'iirrt:t' sh.rc t'cir sccretswit'thcir peer rcc(xr:riitirrl suc.csslul n'?rnergcrs *r.us peer atter-rtiir'-r iurcl tlrus thcy fbr .r-suc.ess, criniate rrelp crcirte a pcrlplc' successittl utrits :rncl sttcct:sslul Allttriswillbeinel-fcctive,however,i[therrr-ritsscckirrgtoart-lricr,ctlleirftrtilsl.r,^ 'l'lrrrs, n e c c s s a r y , " . ' . , . , , . . " ' . ' | l r i s i s o " , . i , 1 g " . , " 1me^ns r , 1 1 ' 1t,,,,"trr.l,rJtrr.s. i . : . , ' . 1 . - , . ' ' { ( ) i rgoals. l S : I n a l ] a g c r.r1cr s s c cestrrirli-: kgolrlsltlt..'' pcoplc'the their give *rrr to fail then i'r'e'ti'crvit' pcoplcbut cxperi're.t rr'rits As r"rou.c,.,r. tlr" procluc.e to be t''1'' ?r goar, tr,reteadcr _.r:t to gct there' thc lezrclertreecls report Uu"X t"ii"t they t-tecd ancl goals ir the achieving inventivelnassemblingttrenecessaryresourCcS. Robert D. Behn: Bottom-Line Government Peoe I A Bottont-line government cloes not depend upon direct management. Rather, all it requires is that the leader har.e the ability {l) to create legitimate, measurable goals relatecl to t}rc organizaliotr's tlission, (2) to publicize who is achieving and rvho is not achieving their goals, nnd {3) to provicle all rtt-tits rr,'it.hthc krtowleclge and resources necessary to ac,hicve their goals. Building Faith in Government: the Role of the Bottom Line I J r t s i t t t ' s s l t a s l e . r r t t c : c tl " h a l .n r e r c l y t c l l i n g c u s t o n r c r s t h a t i t s p r c l c l u c t s a r e e x c c l l e n t o r s i r t t p l y i t s s c r t i t t g t l t i r t i t s s t ' r l i c ' t ' i s s r - t p c r i o r i s n o t e n o u g h . C o n s c q t r c t r t l y , l t u s i r - r e s s e sg u a r i t n t e e t l t c i r p r o c l t t t ' t s r t t t c l t l r t ' r r s c r l i c ' c . l - . L . f l c : r n w a s a p i o n e e r ri n ' L h c n r a i l - o r c l e r l t u s i n c s s b e c a u s c o f its lifc-tirtrc {uilrillltc('. Il., at arr-ytintc, lrir ilny rcason. yoLt wcrc clissatisliecl with your I-. I.. llezrn produc:t, yott coulcl rctrlrll it. If, :rl1cr twenty ycerrs, yotrr M:rine hunting boot lcakcd, yotr coulcl gct yottr nronr)v irut'k or olcl Leon hinrscll- (or so it seenrcd) would repair iL free of chargc. 'l'oclay, irt irrt cl'lirrt tcl crotrvitrce tircir customers that they prclvicle exccllent proclucls or superior sen'ict:, nlarrv lirurs ofl'er new fornrs <-rl'guzrr:rntees.Sonrc rct.ailerrs,if they lail to give yoll a receipt, rvill givc \'oll,\'orlr clrclerrfi-eer.Sorne banks give you $5.00 il-vorr h:ivc to stancl ir-rline fbr 'l-hc ntore than scvcll tttiltrttcs. C)ldsnrobilc clirrision of General Motors lcts you return yollr llc\v Oldsnrobile fitr itttothcr rnoclel, no qtrcstions asked. If you arc unhappy with thc tcntprtr:rrv ernploycc pror,'iclcclbv Mar-rpower Inc., you do not h:rve to pay the bill. Sttch grratritntecs are. of crotlrse, costly. Tcn pcrcent of thc procluc:ts orclercd liour l-. L. I]catn ztrc rctrrrncd. Ncrrcrt.l-tclcss,by mzrking such a clrarmaticstarlcrncnt of its willingness t.clstancl behincl its products, erbusiness seeks to convincc corrsullrcrs that its procltrcts and scn'iccs nrust, indced, be of the higl-rest quality. 'l-he concept of a guarantee is beginning to czrtch on in the public sector as well. Irr ol,cr hall-ii rlozcn states, school svstems erretguaranteeing tlre skills of their graduertes. If arn cmploycr or anclthcr cclucartional institutiou fincls thc grach,rat.cclcficient in m:rth, or rcarding, or writing, thc sc'lrool systcm will provicle the remedial education li-ce of chargc. More importantly, by making:r guarantcc - by agrceing to zx'hieve a spccific bottorrr lirrc prrblic lcaclcrs nra.y be able to gcncr;rte the resources nccessirry to aclriuve thtrt bottonr lint:. Il'r't'ntl.r,', lbr cxzrrnplc, American pharnraceutical ntartufnc:trrrcrs ancl the Foocl nrrcl Drtr{ ..\rirrrirristr:rtionrvorkccl otrtzrn intcrcsLirtg agrccmcnt. 1-ltc corttptrrricswanted FDAto trpprclvc thcir nr'\\' ])r('s('r'ilrtirui clrllgs fzrr nrore quir:kly. IrDA wantecl a lzrrger buclgct so th:rt it could do a bettcr I il:rt tlrr' rlnrq firnrs fc:arcd that nc-w nroney woulcl simply go inlo thc fcclererlgovernmcnt's .- . : , :' ::rri ll r-r'rlu<'t'tlrc clcficil.whilc approvzrls clf nerv phzrrmitceuticals woulcl not be inrprovecl. ' -:-. r' : i ) t . r ' ( l r ' rrl t ' s o r r r C c s .t o t - l c t1 . l r cc l n r g t ' < l m p a n i e st o a g r e L rt o p a y i l u s e r f e e , t h c . F I ) A . r l u i u - : i r i t ( ' ( ' : I 1 ' , r ' i l lr c r l u c c t l t c t i r t t c r c c l r r i r c c lt r l a p l t r o v c i l n c w c l n r g l i ' t l r r r ' . - . 1 rI . i r t - r ' r r k l l t t ' o u { l ot r ' l i f i ' - s i r v i r r q "t l r u g s , F D A r v i l l t ' u t t h c a p p r u v a l t i r r r t ' ^ : : . - ( ) r r l v t l t t ' r rr l i r l t l t t ' r ' o r t t p r r r t i ci sr { r r ' ( )t o p a y u s c r c h a r g e s . i r r c l r r c l i r r q , : r . l r . i ' . r r , nl.l l l r t u ' i l l p t ' r ' r r r i t[ : l ) ' \ t o l r i t ' t ' ( j ( ) O r u o r c t ' n r p l o y c e ' s . - f l r c r r c s ' : . ' . i , : . . ' \ : . : r : I : 1 , . t : : r l , ' i 1 t ' . t ' \ ' ( ' . u - > . : lri,trtl l : i ) . . \ l t r i l s t o r r r ' I r i t ' t ' t ' i t s n c r v L l o t t r t n r l i r r t . . t l r t ' ( i l - l l l ( / r i : l i ) . t l ) i ( > ( l i r l . L ,i i . , r ' . r ' i { | I ) . r v l l 1 - 1 } i , ' t t t i t c l t ' r t t l r l t ' : . ( ' t a ' i (( ' . \ t t l t t ' t ' n i l o l l l t t ' 1 r , . ' t t t t t t ' t i t t ' t t t t t t . r ' .l l t t ' . \ r t t t ' r r t , r r t l r L r l t l i c i s t ' x t r c t n c l r r r t n h t r l t l t v r . i ' i t l i t l i p c t . l o r t n i u r c t ' o l i t : t o \ ' r ' r - n n l ( ' n t . \ ' o t t ' r - s l r t ' l i t ' , , t ' 1 i ] . r tt l i c i r t . i . \ f : ' l r r c t o o l r i { i r i i r r c l t h i r t t l r t ' r l r i r r i l i ' , r i f { o v e r r t r n c n t s ( ' l a i ( t ' s i : t o o l t x r ' . l r t 1 9 8 7 . f i r r t ' r i u n i r l r ' . t l r c O p i n i o n l l c s c l r r < ' l r f ' o t . 1 , , ) l . . i i tl ,r c t ; r r c i u t ' t c c li l s u i \ ' r ' , \ ' 1 o t l e t c r l t t i t t e l t r , r r vt h c p l r b l i t ' r i t t t ' c l t l t c c l r r : r l i t yo l - t l t c l i - c l t ' r : r {l o v t l ' , r i l i r ' r } 1 . l i r t ' r c s p o n s e s w e r e : a v e l ' i i g e o r e x c e l l e n t , l 5 p e r c c r t t ; a v c r a g e , 3 9 p e r < : e n t . :b e l o n ' i l v r ' l ' i r { ( ' r t r 1 t o o r . - i , = r perccnt. Other pc-rlls produce sirnilar resulls. - - - - Robert D. Behn: . | o c h a l l g e t l r i s p e r c c p t i o n o f . g o v e r n r n e n t ,"a t h e N a t i c n a l C pertbrrnal.)-c'c o m m i s s i o n o n t l rMost e P u b of l i c Sit.e n ' i t ' t ' culture of of ;;;;l; rh" ,,rg"a strengthenlllt (the v''ke, cnrrr.,rtJriorr) ,naking puy "nt'p"titi'e ' ttris 'ew ltrlturc in'ol'e.l creating ror recommencra.ior-rs n*}*$,'i,llli+tiit:}?Fill*ill r,"'*'1';;rr{"".#l;;i1;;i"T*:tlff :'1*ffi 'fhe conrnrtss so as I' rvork. shoirlcl give ol11.fewer iro.trscs (:'ttt ilui,rrr-r""t itt t t t shoulcl thrcc arcconlpanying reco'u'cncl,.ror,r","ii,.p_erform"r-* ' itr" government t;;lrigl,'est ." zrssi-r rcso'rccs should co'ccntr:rte s.zlrce brrclgct .f l.ers...er Mirnirgemcnt ,gr.ii,rn^;i.g ; a'cl .h" i;,il;;,i dffi.,., rvith to experi're.t "0"'tu"i'*:;';;p;;tttl :rncl proclr'rctiviLy iurprovctnent.'' ergencies .,r-t "trulture t' Y e t w i t h o t r t a . r r y n r c c l r a n i s n t o l c r c l r s a t t ' c r r t i ocreatir-rg r r o n r e a l pthe c r f odcsirecl r n r i r n t ' c . - w i t h o uof t a nperformzrtlt ybolttllt: to*ur,t, r: progrc", any cuiturc a To create to'g"t'' line _- it is clifllcult toi.nake nlc.sLrrecl ztgainr;t '""1 lllr rcsirlts con'irce real '",,r., perlbr.ra'c" Similerrly' to ' will I'ravc to achic'tr *p""tr" [""1s' in governnrcnt will hrtt work perlirrmar.c", gnu.rrir',"-* agertctiet' who qualltl" tl'rosc .,in'gtt rir''' which fr.r.,*t.-l.'i st^nclarcls against voti.g public th"t iil;;o ;;;,;t;"; the public vnlues.'pc,rforma'"" tl.rat o,.,tcom.,s linc' to:rchieve a bottonr f)erfcrrnrarncerequircs perfonnance ctLll b;;;tt=ttrca' or tlrt'ti: t uclo Irrlrislgg2tlarrrperigntbrthcU.S.Senatc,ReprcsentativcLesA C oai ncl:urn s a i c l :thing ' . V c l t ef r s t l l t t i ^ ;;, J.t+ wzrshinglo" in Unlortunzrtclr ' 1' : :ttt -t]t:::.,";ao"tt"t real tro'blc" therc is a rulingl ctrrss "sh.'v rcal rcsttltt I tlii.k I ctrtr, vo":'"-ut ancl r.sults, .,,,,., tr U.less vou cirn ,'r,* ,-,r"i.t-r"rl nicur-rg..,tr in govcnr'rert ,j;;iir,"l"^t clifticult is it Atrcoi', '.to sltr )\\'l l : brarnc't or in arbusirrcss execrtti'u,c t.lrc in tll' ' arr irrclividual In |act, iI is clill]cttlt lbr t"ttrlt Olincliviclu:rl efforts: a business ilrc '-t"i itt" of au-.rri' setrvicesbuilt ancl still be resr:lts.,, The procltrr:ts trr.,", o.r. cconomy rvotrlcl te.ms. If *r.t were not tinrr_, groupr, from restrlt -i"rr""qrrc'tly, l u c t s a n c l s e r v i c e s p r c l cany r u c ccffort c r b y gtoo revaluatc ' ' c r n n r e nrcal t s a r govertrtrtt':. cthct-t':'r' c o t t a g e r n c t u s t r i e s . S i n r i r a r l y , t h e p r o c"iiorir. t",.or perlb'rrrrr' but of culture zr perlormer.ces solo dreati'g not of o' o.g,.rrrrotiunal pcrforn-r-or-r"i,. of irrga.rzarti.nal pcrfo"irr. performance must foctrs opploirrrrs but tn., afprairal performorr"" .^.,,rires not ircrividual t"oturement' ilt.i' .Jt;l;cs a bottont-litt" sigtrificantly the crccli.llrl.. -' tr specific, bottomlinc ctrn c-n}rtrncc 1' -Ma.s-sachusetts lbr r Creat'irrg :rncl achievilrg r,oa.rr"",-r trorking in I rtr'' cHol#;'irng.,.r. peoplttf the of Aft,;-ilr" '85 of governme't. po'" Joy trt"t 86 pcrcent ': reilr;:;i'l;ilt" staff percc't of tltc pco'lt' ycars, tne go.rernrrf "j.'i"r.i o"utl-t"' li/tt" tt't"'" c,r;r ;;;.-'-t""-'" t'sertrcl ll''' progr?rnr. ta'or of u.I-,our welfarc n"p"'tt'J"t-nl lt"t'""t'"ir.clertook "'fhe tatx rrlassa'tlt"""t" ttt" wi-r.,ri 1lt't': wr-otci. antwentc't: in fav'r of wclt:rre?' i'Jr. *""r.r, o.e citizerr within returns refun.s u, ..rr.rrlir"e 'lhe'f liccl' I got mine in two weeks'" promise tot" *""ki ftt i"ft""as' Toitrrprclvethccitizens,|aithitrgtlvernnrcnt,ptrblicleaclcrsneecltodellncandtlrerrat'}l:' liue' thcir bclt.tc-rm TheDilemmaofMakinganUp-FrontCommitment :rppointecl rt!' : lfbottom-linegovernnentappcarstclhave,n,ll:}"yirclvantages.-ancli|itsirrrplenl(-lll.ii --.rtfti, .fo not nrore."t:::"i clt;"f cxJctttiT.:1"d Tittt' stratel5r' seeilrs to be so straighttbrward goals i-sir well-tested rrl.ntrgerial crcatin!u'"lt't" arll, perlbrmatrt'c "sig'itit:a'tlv ,q?t". iucreased murnagersrr., ,ti l'ras found th.i ;;J;itt"g Icleaso'f Nlanagemerltr'l' creit again, ."="o."h"r, ir;"" i" I "tt'ay;iit" Al".;;;' "r that rt't. University Jack Dunc.r'r, oiltr" "^,' "o*" close to duplicating ,No other motivational tecr,nlque known to clate that to achieving managerial success. Visible goor= *;";niiat i i r i r r ' r i i ) . i j t . l r n : I J ( ) n o n l - l _ i n (G, o \ . r , r n r n c n t i .r-, . r L .I l l b r t t t t r : l t e l r ' . r ' t s i b l e g r t a l s t r l s o p r o v i c l e t h c b a s i s f o r p r r t v i n q r r r l r r i r { r , r r i t l f t r r l r r r c . Br. ( ' r c i l t i l l { l l v i s i l l l c { o : } 1 .a p t r b l i c l e a c l e rg i v e s v o t c r s . j o t r r n : t l i s t s , a n c l p g l i t i i , l i ( } l J I ) . ' ( , ' t \ .r.l...rr s t i t l t c l : r r ctl o t t s e t o r l e - c ' l a r tr 1c - r el e a d e r ' s f a i l u r e . T h a t i s u ' h v o n c g o v c r n o r s u c . c L r c t l r . i n s t n r c . t c c l his "Ncver ilqencv ireacis: put a nunrber zrnd a clate in the serrnescnrcnce. The dilernrtra of bottom-line government is that without specific goals, it is clifficult for sonleone to prove that you have failed. At the same time, without specific goals, it is difficult to accomplish very much. If you do not put a date ancl a numbcr together -- i" tt-re same sentence -- you will never be able to achieve or cleclare much success. To get crcclit for an accomplishrnent, you neecl to declare up front that you will do it. If L. L. Bean quietly proviclecl a no-qucstions-askecl refund or exchange, it would reap no benefit from that guaratrtee. Simil:rrly. if thc Massachusetts Department of Revcnue had not promised :r four-weck relirncl lbr crror-liee rcturns, it rvould have gained nothing frorn this :rccomplishment. In ftrct, er.lthough thc data available to the department was almost pon existe't, its leadership concluc-lcclthalt nlost of the previotts yctrr's refund chccks hard, inclecd, bcen mailcd within lbur weeks. Bttt tlrat iiccomplishntent went conrpletcly unnoticccl nncl unapprcciatecl. Still. llrost govern[]ent lt:adcrs arc trnwilling, :ts one agcncy heacl put it, to',play visiblc-r'l:rinls g:lnter." Yct wl-rat is u'rong with such visible claims'/ 'l-Wothings: the First, otlcct you make a claim to having achicved a vcry/ visible result, vou will bc expected to itcllicvc othcr, tnorc visiblc -- or at least mclre significant -- rcsults. 'fhe visiblc-clainrs g:rme is n nt:ut:lgerial treadmill; once you get on it, yotr can ncvcr get off. 'l-he prrblic always rvants to knorv: \Vhat have you done frtr rrs l:rtely?" This leads to tl"rc second problem witl'r the visiblc clitinrs gzrnlc. In :rn cllort to answcr the "Wllat rlrtestion, have yott clone for us lzrLely?",thc zrgcncy's lcar]ersl1ip may bc tenptccl to in'ernt itt'tother Visible zrncl achicvarble bottom linc simply so thzrt it cern nchicve it.. Tl'r:rt is. once :l' illlull('v st:rrts playing tl-rc visiblc-claims g?rlne, it rtrity lte tcnrptecl to continue pletying it illclcpcnclently of its rcal rnission. After nll, the mission ancl tlrc golls arc po1 (in f;rct, cnn irot) be 'fl'tus, icictrticitl. thc trgency may well be cranking otrt sorne vcry visible successes while making littlc progress trlrvarcls zrchieving its real rnission. Still, if they rcally want tct accomplish something, ptrblir: leaders will neecl to stick their tttc'ks out. 1-l'reywill have to make a public commitmcnt -- whcther it is to fincl jobs tbr 50,OOO wt'lfilre rccipients Or to produce refuncls on crror-frcc'tax rcturns witl-rin fourwceks -- nncl thc--' 1lt'rlclttceit. The bcst way to get an organization to proclucc results, rcvetrls research on ntan 1:r('lllt'llt. is to crezrt.ea goal that is very visible and explir:it -- ernclto clo th:rt gp liolt. Morecx,er. ' :.' lrtst lv:ry to get credit for achieving that goal is also to nrukc it vcry r,isiblc and explicit -- :rgaip, .: : : - /r l l l . \ t ' r ' t ' r t h c l c s s , t h e c l i l e m n t a i n h c r e n t i n b o t t o r r r l i r r c rg o v c r n n r e n t i s c l e a r . M a v i t c t l r c :':.::I i'r rI (or the :rgcncy) will not zrchicveits goarl. 'l'hcr r what lvill herppcn? Will the orgairizatiprr .'r .r'.iclt'l-sbc act:usccl of fzrilure'/ Or will thcy bc given an A lbr eflclrt? Will they .gct r.rcclil :..i.a tltrtrlc'significant progress against a tough go:rl? Or will they be clislrissccl lrs ::.: '':i':tl tor liriling to make such a sinrple bottom line? : ) ' . r \ i l l t ' s s ,b o t t o m - l i n e m a n a g e m e n t i s n o t f o r t h e l - a i n t h e a r t e d . S i m i l e r r l y , b o t t o n t - l i r r c :l t\ ()nlv fitr the reSolute. Robert D. Behn: uottom-Line Government Page 19 Creating a Box Score for Government cubs fan' reports that George will, political commentator, columnist and chicago of the U's' House ol speaker o'Neill, then Hall-of-Fantepitcher, warren spahn, once said to Tip Representatives: Mr.Speaker,baseballisagameoffailure.Eventhebestbattersfailabout65 today [spahn' 363 percent of the time. The two Hall of Fame pitchers here wins'245losses;BobGibson,25lwins,lT4losses]lostmoregamesthana teamplaysinafullseason.IjusthopeyoufellowsinCongresshavemore success than baseball players have' -- an opportunity to remark on the lack of will, of course, could not resist a commentary governmental success: ThefellowsinCongressdon.t[havemoresuccess]andthe,vknowit. the game of no .4OO hitters in Washington. And players in are There governmentaresparedt.hesortofremorselesslyobjectivemeasurenrentoftheir see in box scores every day' f,crformance thaf ball players to wakc up in the morning knowing that Indcecl, those who work in government do not have 'l-hosc who work in g.r'0 lor 5 ycsterclay' everyonc in thc country is icacling tliat they went thelt cveryone irl the country is rezrclin{ ernment clo not havc to rvzrketrp in the monr-ing knowing thirttlrcir.sitlesitttltt'lirstqtritrterrlr.rrllpc<||j|lcerrperct'nt. 'fhcv sonething like that to happen' want should government in lcaclers Nevcrthcless, their box scorc in the morning papcr' Thcr' shcluld want arll their agency's personnel to rczrd in the nrclrnin$ papcr. furd they shoulcl rvattt shoulcl want arllthe citizens to reaclthese box scrorcs citizens are reacling their box scores in tht' all tl-reir agcncy's pcrsonnel to know th:rt arll the morning Paper. own box score' It needs some helplirl Government neecls its own boltom line, its --how wcll it did yesterclay' how well it dicl last performance indicators that tell it and everyone leaclcrs neecl to choose thc perforrnall('(' quarter, how weII it clicl la.st sczrson. Govcrnmcnt government leaclcrs thcir own box scorc cl21n indicators fcrrtheir own bottom line. Only by crcating -importantll' -mclst ancl it, fix .nd is brokcn measurc progress, motivate pcople, cleciclc'wl-rat is cloing tr goocl job a.d is worthy of tScir convi'ce citizens and taxpayers thaf gou.-.,t"t"']t supPort. Dtlke UniversitY and director of its Govcntors Robert D. Behn is pro{-essorof public oolicv at itl I-essons-fbr hrb\ic M antacters (Htrn'ard Univers Center. He is thc author of Ieaderstip Courits; Press|. The Governors Center at Duke University Terry Sanford Institute of Public Policy Box90246, Durham, NC 27708-0246 919-613-7374