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DeCA Director Offers Lessons Learned On Government Reinvention

By Bonnie Powell
National Guard Bureau

BETHESDA, Md., April 25, 1997 – An overflow crowd heard the "dos and don'ts" of starting a performance-based organization from the director of the Defense Commissary Agency during the annual Reinvention Revolution Conference held here in early April.

Retired Maj. Gen. Richard E. Beale Jr., was joined by directors of two other PBO candidates, Brad Huther of the Patent and Trademark Office and David Sanders of the St. Lawrence Seaway Development Corp. The conference also featured a keynote speech and town meeting with Vice President Al Gore.

The commissary agency sells groceries at cost to active duty military and retirees worldwide. It is the first "transitional" PBO in the federal government; it is also currently the largest with over 17,000 employees. Its PBO package is under review by the Office of Management and Budget before it goes to Congress.

The intent of performance-based organizations is to help viable segments of government operate more like a private-sector business, saving money for taxpayers and increasing service for customers.

"In theory, any government activity that provides a customer service to any segment of the public is a good candidate," Beale said during a packed Reinvention Revolution "learning laboratory" aimed at informing other civil servants about the benefits, process and pitfalls of starting a PBO.

DeCA has initiated many cost-cutting measures since its formation in 1991, and that is one reasons it was nominated to be a performance-based organization, said Beale. "There is not much more we can do in the way of efficiencies without PBO to change regulations and law. What we have tried to do with regard to the whole effort is to maintain our focus on activities that add value to selling groceries" instead of on red tape, he said.

Beale outlined a few of the possible benefits of becoming a performance-based organization and how it can save money and increase service. One initiative puts some of the money saved through efficiencies into customer service, he said. "The idea is if you save money, you get a percentage back to roll into customer service." In addition, the agency has been required to keep funds in three separate accounts. Merging them into one fund would save costs of duplicate accounting and allow the agency the flexibility to put money where it is needed most.

Another possible benefit, said Beale, is the ability to shop for best price and value for services on the open market, such as transportation of goods, instead of being required to use government services. In the area of acquisition, "we have to buy scanners for our check-out stands the same way the Air Force buys high-performance aircraft." That has proven very costly and time consuming, he said.

In the personnel area, DeCA has traditionally operated under civil servant regulations designed for a "policy" environment, not a retail business. "What we need is 'store level associates' in the stores," said Beale. "We need to be able to take produce workers and move them to a cash register when needed."

One PBO pitfall, according to Beale, is the often complex process of working through channels to achieve significant changes. "It really takes a lot of nurturing and shoe leather."

DeCA's PBO effort started nearly a year ago, and there have been several lessons learned during that time, Beale said. "You've got to be top-driven. If the agency head is not behind PBO or re-engineering, forget it."

An absolute must, Beale told the crowd of potential government reinventors, is the willingness to change an organization's culture. "People will tell you change takes time. I say change takes commitment -- from the top to the bottom."

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