The Last Lap

Steve Player speaks with Clay Johnson, Deputy Director, Office of Management and Budget of the U.S. Government.

Steve Player: Let's begin with a brief description of the role of the Office of Management and Budget and your role within it …

Clay Johnson: Originally, it was just the Office of the Budget, which was created in the 1920s to help the president prepare and present to Congress a budget that would reflect his priorities. We don't have enough money to do everything that everybody wants to do, so the president submits what he hopes the Congress will go along with and hopes that they will fund the priorities that he has. Then Congress has their way with it, and they eventually agree on something they can both sign and implement.

In the 1970s, they recognized that they needed to establish an organization not only to help the president put together a budget that would reflect his priorities, but also that would help the federal government to spend the money that was actually appropriated by Congress. That's when they added the management part, creating the name “Office of Management and Budget.”

And in 1990, they created a second deputy. There was already a deputy who did a little bit of everything, and there was a whole lot of attention always being paid to the budget, but not much attention being paid to the management part of OMB. They created a second deputy position in 1990, and I'm that deputy. I'm the deputy director for management at OMB, or what we affectionately call the “M” in OMB.

SP: Your role is really about making the government effective in terms of what it's trying to do …

Johnson: Agencies are obligated to spend the money as Congress says. They can't take money from one program and then spend it on another program. If Congress says you can spend X on Program A and Y on Program B, that's what agencies have to do.

But once they have a certain amount of money to spend on a program, we help them to spend that money more effectively to increase the chances that they achieve the desired outcome.

SP: How have OMB's efforts made a significant difference in achieving the desired outcomes?

Johnson: Back in 2001, the people at OMB identified that we aren't very good at spending the money to achieve desired outcomes because we have really bad definitions of what the desired outcomes are. What the leadership at that time decided was that we needed to take every program in the federal government and establish clear, quantifiable, outcome goals, determine the extent to which we could efficiently measure those goals, and make sure that agencies had a plan for accomplishing these goals so that we can identify what obstacles exist, legislative and administrative, to accomplishing them.

One of the things we found out when we started digging into this the first year was that half of the federal programs we looked at could not demonstrate whether they were performing well or badly. They just couldn't clearly tell you what their goals were, what they were trying to accomplish, or how they were performing relative to those goals.

It took up to seven years to make sure that every program had clear outcome goals — not output goals, not input goals, but outcome goals. And that's hard to do. There are probably still 15 to 20 percent of the programs that I can't tell you we have good outcome goals for. We're trying to do some things in the federal government that are very difficult to do — peace in the Middle East, cures for cancer, man on Mars — and we're trying to do some things that take decades to accomplish or that nobody has ever done before.

We spend $28 billion a year on medical research. We're trying to find cures for diseases that no one has ever found. As a manager, how do you develop a good outcome goal for that? What is an appropriate time frame to achieve that goal? It's very, very hard to do. But that's no excuse for not having as much purpose as is humanly possible to have.

The one thing that did not exist in the federal government to anybody's satisfaction was clear goals and real accountability for accomplishing these goals. We have tended to reward attendance, not performance, and we have tended to evaluate people's competencies, not their performance. We tend to get generally excited in the federal government about passing legislation in the form of bills to address problems and funding these bills with money. And once we have a bill and money, we tend to believe that the problem will be solved or the opportunity will be realized. And I'm here to tell you that the fun has only then just begun, because until you've appointed good people to head up these efforts, good management practices, and clear performance goals, there's no chance of accomplishing anything.

The bill and appropriate amount of funding are just the beginning.