B&G Report: Anonymous Contractors, Unconventional Budgeting and the Seattle Syndrome
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We've noticed that the contractors involved with government products or services often seem to operate under a mask of anonymity -- not just in the press, but even in government reports.
Consider this Salt Lake Tribune article, about a downturn in parking revenues. The piece indicated that the meters in town have had technical problems. They sometimes reject credit cards that should be accepted. Additionally, since they are a fairly dark shade of blue they have also been difficult to operate at night. Why did the article neglect any mention of the company that makes the meters? (With a little Googling we discovered it's named Aparc Systems).
We called the reporter in Utah to see why he left the contractor's name out. His answer was earnest. He wished he had included it. "I think it's a significant oversight on my part," he told us.
We respect him for his candor, but this example is just one of many. In a day when the connections between the private and public sector are becoming ever more important, we think that contractors should be identified when writing about government services they're delivering. Anyone disagree? Or see more reasons why these names are left out so frequently?
The Project Coordination Office in Chicago has saved some $10 million in its first year of operations. How? By simply overseeing roadway and maintenance projects so that city departments and private utilities can "work out project schedules more efficiently." That way, projects can overlap as much as possible, reducing the amount of time "residents are inconvenienced," according to EfficientGov.
This seems like pretty obvious stuff, but it's likely that it couldn't have worked this well just a few years back. The office relies on automated database scheduling, which uses algorithms to prevent "conflicts and "streamline processing."
By the way, if you're interested in more on this topic, you might enjoy a column we wrote in May 2013.
When we get correspondence from readers, typically the responses represent a wide range of opinion. A couple of weeks ago, we set forth the idea that public officials who are promising to pay for tax reductions with service cuts announce -- at precisely the same time -- the items that are going to drop out of the budget as a result. We called the item "B&G's Law," and have rarely gotten such general and often passionate agreement (though we thought a handful of them were off base).
Typical was one from a Midwestern fiscal operations officer. "I agree whole heartedly with your suggestion. I think it goes along with accountability and being transparent about your intentions," he said. ... So often, personal agendas come into play. This way everything is out in the open."
Generally speaking, people think of budgetary shortfalls as far worse than having cash left over at the end of the year. This isn't necessarily the case. An audit by the New York State Comptroller of the town of Clarkson makes just that point. Apparently for years, the town has spent less than it forecast and brought in revenues higher than predicted.
Between 2008 and 2012 the town overestimated highway fund expenses by more than $900,000 and three years ago Clarkson created a budget in which it predicted sales tax revenue at $394,000. The actual figure turned out to be almost $800,000. And that sort of budgeting's simply not a good thing. The town supervisor disagreed, indicated that his community operated under "different philosophies" than the state comptroller and said he enjoyed the security the town has achieved by generating more cash than it estimated.
We can see the supervisor's point of view -- sort of. But it seems to us like there are much better ways to budget in a conservative way than to force conservatism by wildly overestimating the town's financial needs.
"Those who can, build. Those who can't, criticize." - Robert Moses, an urban planner responsible for much of modern New York City
Looking for a way to save on health care for city, county or state employees? Here's an idea based on an article in the Archives of Internal Medicine.
The article compared people who sit more than 11 hours a day to those who were behind their desks for less than four hours a day. Turns out that the chances of dying within three years are 40 percent lower for the standers than the sitters. How can an employer (public or private sector)encourage those who use their legs more than their posteriors? Treadmill desks.
Not only do these contraptions seemingly help keep people healthy, other studies suggest that they improve productivity and creativity.
Typically, the only way people think about the costs of government programs is in dollars and cents. But Donald Moynihan and Pamela Herd, professors at the Robert M. La Follette School of Public Affairs at the University of Wisconsin, point out that the administrative burden of dealing with government programs represents significant price of another kind.
Consider the time that people have to devote to learning how to get a service or apply to a government program. Moreover, once that hurdle has been cleared, there are compliance costs to actually applying -- providing documentation for example. Then there can be psychological costs when citizens are confronted by an unhelpful government worker.
All of these things (often dubbed red tape) help people form a negative impression of government.
We call it the Seattle Syndrome. Years ago, we were evaluating cities on their capacity to use data in order to evaluate the success of programs. We interviewed officials in dozens of cities to get an idea what was going on. Seattle's administrators were outstandingly self-critical; pointing out all the city's shortcomings in this area. When we talked to a number of other cities, we realized that Seattle was more proficient than most of them. Its officials only thought they were behind the curve because they knew how much better they could be. Cities that had no idea of the potential of data for management were pretty much convinced they were doing everything they could.
It's our theory that this phenomenon is one of the reasons why some cities have a hard time making progress in their management. If you can't see the sky, you'll never leave the earth.
The Seattle Syndrome -- a corollary. One of the most common methods used by employers in both the public and private sectors is asking candidates to self-evaluate. On the face of it, this sounds like a perfectly reasonable approach. But just as Seattle underrated its skills in the previous example, many well qualified job applicants also seem to underestimate their skills.
That's one of the conclusions reached by Bob Corlett, a contributing writer for BizJournals. He writes that there's solid evidence that, "Unskilled candidates consistently overrate their abilities and more skilled candidates consistently underrate their abilities." This insight can be extremely valuable to human resource officials, or others involved in the public sector hiring business.
Given the number of state ratings and rankings in which we've been involved, perhaps this item is an example of throwing a rock at a glass house and then throwing it out again. Connecticut's Office of Legislative Research recently released a well-wrought brief about the widely varying findings in studies that rank the "business-friendliness" of states.
The brief points out that one factor with significant impact on a state's ranking is whether the study looks at all businesses or just a subset. "South Carolina and Texas outranked Connecticut in the Tax Foundation's 2013 State Business Tax Climate (36 and 9, respectively, to 40), which assessed how different types of taxes affected business generally."
But then take a look at the Tax Foundation's 2012 study, "Location Matters." This one looked at how taxes affected "new and mature businesses including R&D facilities and capital-intensive manufacturing." There, Connecticut ranked better than both South Carolina and Texas.
Lesson: Before you put any credibility in one of these rankings, take a good look at the fine print about the criteria used.
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