Step 1: --Giving Customers A Voice-- And A Choice

Setting Customer Service Standards

Long lines, busy signals, bad information, and indifferent workers at front counters-- these are all too common occurrences when customers come in contact with their government. Quite simply, the quality of government service is below what its customers deserve.

We propose to set a goal of providing customer services equal to the best in business. Too many agencies have learned to overlook their customers. After all, most of government's customers can't really take their business elsewhere. Veterans who use veterans' hospitals, companies that seek environmental permits, or retirees applying for social security benefits must deal with public agencies that hold monopolies. And monopolies, public or private, have little sensitivity to customer needs. So government agencies must do what many of America's best businesses have done: renew their focus on customers. Some are already trying. The Internal Revenue Service (IRS) and Social Security Administration (SSA) have taken major steps to improve their telephone services to customers. SSA, the U.S. Postal Service (USPS), and the Department of Veterans Affairs are developing a combined government services kiosk, providing a single point of access for services offered by the three agencies. The Library of Congress, the Energy Department, the National Aeronautics and Space Administration, the National Science Foundation, and other federal agencies have placed their materials on Internet, a worldwide computer network. See Note 1

Good service means giving people what they need. To do that, however, one must first find out what they want--a step few federal agencies have taken. In the future, federal agencies will ask their customers what they want, what problems they have, and how the agencies can improve their services.

Knowing what customers want, public agencies must set clear and specific customer service standards. When Federal Express promises to deliver a package the next day by 10:30 a.m., both customers and employees understand precisely what that means. Similarly, when the Air Force's Tactical Air Command discarded its thick set of specifications about living quarters for visiting pilots and adopted a simple standard- -equivalent to "a moderately priced hotel, like Ramada"--employees understood exactly what it meant. See Note 2

Several federal agencies that frequently interact with citizens have launched aggressive customer service initiatives. We endorse strengthening these initiatives--described below- -and expanding them across the federal government.

Internal Revenue Service.

The IRS, the federal agency most citizens prefer to avoid, might seem the least likely to develop a customer focus. But it's working hard to do just that.

Four years ago, the General Accounting Office (GAO) discovered that IRS staff gave a wrong answer to one of every three taxpayers who called with a question. Since then, the agency has improved its accuracy rate to 88 percent. See Note 3 And--in a switch that signals a basic change in attitude--agency employees now refer to taxpayers as customers. In IRS pilot projects across the country, employees now have authority to change work processes on their own in order to improve productivity. Front-line workers also have more authority to resolve issues one-on-one with individual taxpayers. The agency is fostering competition among its tax return centers, based on customer service levels and efficiency at handling the 1.7 billion pieces of paper the IRS receives each year. Centers that perform better get higher budgets and workloads, and employees get promotion opportunities. The IRS was among the first government agencies to use 800 numbers and automated voice mail systems to increase customer access to information. Today, the IRS is beginning to survey its customers.

Customer Service Standards: IRS

As part of the National Performance Review, the IRS is publishing customer service standards, including these: If you file a paper return, your refund due will be mailed within 40 days. If you file an electronic return, your refund due will be sent within 14 days when you specify direct deposit, within 21 days when you request a check. Our goal is to resolve your account inquiry with one contact; repeat problems will be handled by a Problem Resolution Office in an average of 21 days. When you give our tax assistors sufficient and accurate information and they give you the wrong answers, we will cancel related penalties. With your feedback, by 1995 IRS forms and instructions will be so clear that 90 percent of individual tax returns will be error-free.

In addition, some centers are serving customers in truly astonishing ways. One anecdote makes the point. At the Ogden, Utah Service Center--a winner of the Presidential Award for Quality--a down-on-his-luck man hitchhiked from out of state to get his refund check. As it turns out, this center doesn't issue checks. But IRS employees there discovered that a disbursing center had sent a check to the hitchhiker's old address and that it had been returned. They ordered a new check sent to Ogden and helped the hitchhiker make ends meet until the check arrived.

In the end, the IRS's efforts could affect all of us, not only as filers of tax returns but as taxpayers. If IRS forms are easier to understand and use, more taxpayers might file on time. If the IRS develops an image as a more effective, user-friendly agency, more taxpayers might decide to file in the first place. A mere 1-percent increase in voluntary compliance would add $7 billion in government revenue each year. See Note 4

Social Security Administration.

Every year, more than 47 million Americans come in contact with the Social Security Administration, which administers old-age pensions, survivors' and disability insurance, and the supplemental security income (SSI) program. The agency has 1,300 field offices and receives 60 million calls a year on its toll-free lines. As the nation's population ages, the agency faces an ever-increasing workload. Recently, an inspector general's report showed that customer satisfaction had fallen 4 years in a row due to longer waiting times in offices and increasing problems in reaching someone on the phone. See Note 5

Fortunately, the Social Security Administration is strengthening its customer orientation. When Hurricane Andrew struck South Florida, where 367,000 people collect social security and SSI, agency workers took steps to ensure that senior citizens would know how to get their checks despite the devastation. Local offices used television, radio, and loudspeaker trucks touring the area with messages in English, Spanish, and Creole. The agency also hired an airplane to tow a banner with SSA's toll-free 800 telephone number over the hard-hit Homestead area.

Customer Service Standards: Social Security Administration

As part of its participation in the National Performance Review, the Social Security Administration will publish nationally, and post in each of its offices, these performance standards: You will be treated with courtesy every time you contact us. We will tell you what benefits you qualify for and give you the information you need to use our programs. We will refer you to other programs that may help you. You will reach us the first time you try on our 800 number.

More generally, the Social Security Administration recently adopted a customer-oriented strategic plan, which includes objectives such as issuing social security numbers orally within 24 hours of an application. Besides pinpointing some of their objectives as standards to reach today, SSA is publishing all 34 of its objectives and seeking customer feedback on whether it set the right targets for service.

U.S. Postal Service. The Postal Service, which delivered 166 billion pieces of mail in 1992, has begun improving customer service for a good reason: It has competition. While most people still use the Postal Service to deliver first class mail, the use of private delivery services and electronic mail is rising quickly.

Customer Service Standards: USPS As part of its participation in the National Performance Review, the USPS will expand its plans to display these standards in post offices: Your first class mail will be delivered anywhere in the United States within 3 days. Your local first class mail will be delivered overnight. You will receive service at post office counters within 5 minutes. You can get postal information 24 hours a day by calling a local number.

The Postal Service has decided to meet its competition head-on. Using focus groups, the agency identified service areas where its customers wanted improvement. It found that people wanted shorter waiting lines at counters, better access to postal information, and better responses to their complaints. Using these standards to measure performance, the agency set a long range goal of "100-percent satisfaction" and developed a customer satisfaction index to measure progress toward it.

The agency also is providing incentives for employee performance: In cooperation with two postal unions, managers now use customer satisfaction data to help determine employee bonuses.

Action: The President should issue a directive requiring all federal agencies that deliver services to the public to create customer service programs that identify and survey customers. The order will establish the following standard for quality: Customer service equal to the best in business.

See Note 6

The President's directive will lay out principles to govern the provision of customer services. For example, organizations should:

survey their customers frequently to find out what kind and quality of services they want; post standards and results measured against them; benchmark performance against "the best in business"; provide choices in both source of service and delivery means; make information, services, and complaint systems easily accessible; handle inquiries and deliver services with courtesy; provide pleasant surroundings for customers; and provide redress for poor services.

The order will direct all federal agencies that deal with the public to:

immediately identify who their customers are; survey their customers on services and results desired, and on satisfaction with existing services; survey front-line employees on barriers to, and ideas for, matching the best in business; in 6 months, report results on these three steps to the President; and develop and publish a customer service plan--including an initial set of customer service standards--within 1 year.

The customer service plans will address the need to train front-line employees in customer service skills. They will also identify companies that agencies will use to judge how they compare to the "best in business." The directive will ask cabinet secretaries and agency heads to use improvement in customer satisfaction as a primary criterion in judging the performance of agency managers and front-line employees.

Action: For voluntary customer surveys, the Office of Management and Budget will delegate its survey approval authority under the Paperwork Reduction Act to departments that are able to comply with the act.

See Note 7

The public's input is crucial to improving customer service. But current law gives the Office of Management and Budget (OMB) power to decide on virtually all agency requests to solicit information from the public (OMB can delegate this authority). This law was designed to minimize onerous paperwork burdens the federal government imposes on businesses and citizens. But it also minimizes the number of times agencies ask customers about their needs. It often slows agencies down so much that they abandon the idea of doing a survey altogether.

For many agencies, customer surveys are the single most useful way to measure performance. If OMB has to approve every request for a customer survey, however, neither the directive described above nor the Government Performance and Results Act, which the President signed in August 1993, will work. Citizens do not like to be forced to fill out forms by their government. But most Americans would be pleased to receive a voluntary survey asking how their post office or social security office could improve its customer service.

We propose to delegate approval of voluntary customer surveys to departments with the ability to comply with the law, and ensure that they create rapid approval processes so bottlenecks don't develop at lower levels.

Customer-driven programs rarely cost more than others; indeed, productivity gains in past federal experiments have more than offset cost increases. At the Ogden Service Center, the IRS office's new approach helped workers process 5 percent more tax returns. When organizations shift their focus to customers, they act like Avis--they try harder.

Crossing Agency Boundaries

Unfortunately, even agencies that try harder find very real obstacles in the way of putting their customers first. Perhaps the worst is Washington's organizational chart. Time and again, agencies find it impossible to meet their customers' needs, because organizational boundaries stand in the way.

Sometimes, programs housed in the same agency are only tangentially related. While most Agriculture Department programs relate to food, for instance, its customers range from farmers who grow it to poor children whose families use food stamps. At other times, programs dealing with the same customers are located in a dozen different agencies. Rather than make people jump over organizational boundaries on their own, we must remove the boundaries at the point of customer contact. We must make the delivery of services "seamless."

The traditional solution is to shuffle the organizational chart. But in Washington, such proposals set off monumental turf wars between agencies in the executive branch, and between committees in Congress. After years of struggle, one or two agencies are reorganized -- or a new department is created. Meanwhile, the nation's problems keep changing, so the new structure is soon out of date.

In a rapidly changing world, the best solution is not to keep redesigning the organizational chart; it is to melt the rigid boundaries between organizations. The federal government should organize work according to customers' needs and anticipated outcomes, not bureaucratic turf. It should learn from America's best-run companies, in which employees no longer work in separate, isolated divisions, but in project- or product-oriented teams.

To do so, the government must make three changes. It must give federal workers greater decision making authority, allowing them to operate effectively in cross-cutting ventures. It must strip federal laws of prohibitions against such cooperation. And it must order agencies to reconsider their own regulations and tradition-bound thinking. For example, the Forest Service found that 70 percent of its regulatory barriers to new, creative ways of doing business were self-imposed. See Note 8

Despite these barriers, some noteworthy initiatives are underway. Rural Development Councils, under the Agriculture Department's direction, work with several federal departments as well as states and localities to better coordinate rural aid programs. At the Federal Aviation Administration (FAA), a systems manager helps coordinate the activities of the FAA, Defense Department, international aviation organizations, and various private interests on matters involving satellites, data links, and traffic flow management. See Note 9

We should bring the same approach to other parts of government. The following examples illustrate the problems we face and the solutions we must create.

Action: Create a system of competitive, one-stop, career development centers open to all Americans.

See Note 10

Our nation's economic future depends on the quality of our workforce. Our individual futures, too, depend on whether we have marketable, flexible skills with which to adapt to the changing demands of new technologies. In a country where the average worker changes jobs seven times in a lifetime, those skills are more than desirable; they are crucial.

Our government invests heavily in education and training. Together, 14 separate government departments and agencies invest $24 billion a year, through 150 employment and training programs. See Note 11 But we do not invest this money well enough. For one thing, our system is organized for the convenience of those who deliver services, not those who use them. For another, the system lacks competition and incentives for improvement. "The United States has a worldwide reputation for providing its youth extensive opportunity to attend college," the General Accounting Office noted recently. "However, our country falls short in employment preparation of many noncollege-youth." Unlike our competitors, GAO said, we have no national policy to systematically prepare non-college educated youth for jobs. See Note 12

Our system is badly fragmented. Each service -- from job referral to retraining -- is designed for different people, with different rules, regulations, and reporting requirements. Bewildered, often dispirited, job seekers must trudge from office to office, trying to fit themselves into a program. When they find a program, they may find that they aren't eligible, that it's all filled up, or that the classroom is across town.

American workers deserve a better deal. Nowhere on the government reinvention front is action more urgently needed or are potential rewards greater. We envision a new workforce development system, focused on the needs of workers and employers. We will organize it around the customer -- whether an individual or a business -- then provide that customer with good information about the performance of different providers and plenty of choices. If we do this, career centers and training providers will have to compete for their customers' business, based on the quality of their services.

Specifically, we propose one-stop career management centers across the country, open to all Americans -- regardless of race, gender, age, income, employment experience, or skills. (One-stop centers are also a key feature of the Workforce Investment Strategy the Labor Department is developing.) Our centers would offer skills assessment, information on jobs, access to education and training -- everything people needed to make career decisions. The centers would be linked to all federal, state, and local workforce development programs, and to many private ones (which are, after all, the source of most job-training money). Core services such as labor market information and job search help would be offered free. Some centers might offer other services, from comprehensive testing to career counseling and workshops, on a fee-for-service basis.

These centers would help their customers get access to funds from any of the 150 programs for which they qualified. To make this possible, the federal government would eliminate or waive many rules and regulations that keep our workforce development programs separate. The centers would also be allowed to generate their own revenues, including fees collected from employers and employees would could afford to pay. Any organization, public or private, would be allowed to seek a charter to operate one or more one-stop career centers. The process would be performance-driven, with contracts renewed only if centers met customers' demands. The federal government would establish national chartering standards for the centers, but states and local employment boards would decide which organizations met the standards.

Today, local organizations such as U S Employment Service and Service Delivery Areas get most of their federal funds almost as a matter of entitlement. They account for the money, but we do not hold them accountable for whether they spend it effectively. We would make funding for these new centers more competitive, opening the process to public and private, nonprofit and for-profit, entities.

We would judge these centers in part by how many people sought help at them -- on the theory that centers attracting the most customers were clearly doing something right. But we would focus as well on what happened after the customers left. Did they enroll in meaningful training programs? Did they find jobs? Did they keep their jobs? Did they increase their incomes? Finally, we would give customers the necessary information to decide the same thing for themselves: Which training program would meet their needs best?

We believe that the central problem in the Employment Service is not the line workers, but the many rules and regulations that prevent them from doing their jobs. Waiver of these antiquated rules will free up these workers to perform well. In order for state Employment Services to compete on a level playing field -- particularly after the negative effects of the last decade of spending cuts and over-regulation -- line workers must be given the opportunity to retool. The Labor Department should ensure that they receive the necessary training to enable them to participate in the process. The biggest single barrier to creating an integrated system of one-stop career centers is the fragmented nature of federal funds. The 150 federal programs have different rules, different reporting requirements, even different fiscal years. To synchronize these -- and to break down the walls between categorical programs -- the National Economic Council should convene a Workforce Development Council, with members from the Departments of Labor, Education, and Health and Human Services; the Office of Management and Budget; and other departments and agencies with employment and training programs. This council should standardize fiscal and administrative procedures, develop a standard set of terms and definitions between programs, develop a comprehensive set of results-oriented performance standards, and improve the qualitative evaluation of program performance.

Action: The President shoud issue a directive that requires collaborative efforts across the government to empower communities and strengthen families.

See Note 13

At Vice President Gore's recent conference on family policy in Nashville, experts agreed that effective family policy requires new approaches at the federal, state, and local levels. We should stop dividing up families' needs into health, education, welfare, and shelter, each with its own set of agencies and programs, many of which contradict one another and work at cross-purposes. Instead, across all levels of government, we need collaborative, community-based, customer-driven approaches through which providers can integrate the full network of services.

For instance, we spend about $60 billion a year on the well-being of children. But we have created at least 340 separate programs for families and children, administered by 11 different federal agencies and departments. See Note 14 Thus, a poor family may need to seek help from several departments--Agriculture for food stamps, Housing and Urban Development for rental support, Health and Human Services for health care and chasing down dead-beat parents. For each program, they will have to visit different offices, learn about services, fill out forms to establish eligibility--and wait.

The system is fragmented and illogical. In Texas, where the immunization rate among poor children is about 30 percent, the state Health Department sought permission to have nurses who run the Agriculture Department's Women, Infants and Children supplemental food program also give immunization. The Agriculture Department said no--unless Texas developed an elaborate cost allocation plan. Consequently, mothers and children will have to continue visiting more than one agency. See Note 15

A few years ago, Governing magazine described a teenage girl who was pregnant, had a juvenile record and was on welfare. Between the three problems, she had more than six caseworkers--each from a different agency. As one put it: "The kid has all these people providing services, and everybody's doing their own thing and Tasha's not getting better. We need to have one person who says, 'Now look, let's talk about a plan of action for Tasha.'" See Note 16 President Clinton's directive will help remove obstacles that agencies face in trying to serve Tasha and others like her.

Action: The President should issue a directive and propose legislation to reconstitute the Federal Coordinating Council for Science, Engineering, and Technology as the National Science and Technology Council, giving it a broader role in setting science and technology policy.

See Note 17

Progress in science and technology is a key ingredient of national economic success. President Clinton's A Vision of Change for America, released in February, cites studies showing that "investments in research and development (R&D) tend to be the strongest and most consistent positive influence on productivity growth." See Note 18 In an increasingly competitive world economy, the American people need the best possible return on federal R&D investments.

The Federal Coordinating Council for Science, Engineering, and Technology (FCCSET) is a White House-managed team that helps set policy for technology development. With representatives from more than a dozen agencies, it develops interagency projects, such as biotechnology research and the high-performance computing initiative. Unfortunately, FCCSET lacks the teeth to set priorities, direct policy, and participate fully in the budget process. It can't compel agencies to participate in its projects, nor can it tell agencies how to spend funds. Its six funded projects will account for just 16 percent of Washington's $76 billion R & D budget in 1994. At a time of declining federal resources, experts in business, academia, and government recognize the need for one-stop shopping for science and technology policy.

A new National Science and Technology Council would direct science and technology policy more forcefully, and would streamline the White House's advisory apparatus by combining the functions of FCCSET, the National Space Council, and the National Critical Materials Council.

Action: The President should issue a directive to give the Trade Promotion Coordinating Committee greater authority to control federal export promotion efforts.

See Note 19

Unlike most of our economic competitors, the United States has no national export strategy. Our export programs are fragmented among 19 separate organizations- -including the Agriculture and Commerce Departments and the Small Business Administration. The U.S. and Foreign Commercial Service, in Commerce's International Trade Administration, is the lead agency for trade promotion overseas. But dozens of other entities--many within Commerce--also have trade promotion roles.

Our export programs provide little benefit to all but our nation's largest businesses. The economic implications of such selective assistance are serious. Exports are among our most effective job-creating tools. They create about 20,000 new jobs for every $1 billion in exports. Thousands of small and mid-sized companies make products attractive for overseas markets, but are discouraged by high transaction costs and a lack of information. According to trade experts, the United States may be the "world's biggest export underachiever." See Note 20

The President's directive will give the Trade Promotion Coordinating Committee (TPCC), chaired by the Commerce Secretary and including representatives from 19 departments, agencies, and executive offices, broader authority to create performance measures and set allocation criteria for the nation's export promotion programs. Working with the National Economic Council, TPCC will ensure that such programs better serve the exporting community.

Action: The President should issue a directive to establish ecosystem management policies across the government.

See Note 21

"For too long, contradictory policies from feuding agencies have blocked progress, creating uncertainty, confusion, controversy, and pain throughout the region," President Clinton declared at the Forest Conference held in Portland, Oregon in April 1993. Shortly thereafter, the President announced his Forest Plan--a proactive approach to ensuring a sustainable economy and a sustainable environment through ecosystem management. We recommend extending the concept of ecosystem management across the federal government.

Although economic growth has strained our ecological systems, our government lacks a coordinated approach to ecosystem management. A host of agencies have jurisdiction over individual pieces of our natural heritage. The Bureau of Land Management oversees more than 60 percent of all public lands; the Forest Service manages our national forests and grasslands; the Fish and Wildlife Service manages our National Wildlife Refuge System; the National Park Service oversees the national parks; the Environmental Protection Agency implements laws to regulate air and water quality; the National Oceanic and Atmospheric Administration (NOAA) manages marine resources; and various other agencies run programs that affect the environment. Different agencies, with jurisdictions over the same ecosystem, do not work well together. Even within the same agency, bureaus fight one another.

At the local level, a hodge podge of government agencies control activities that affect the environment. Consider, for instance, the San Francisco Bay delta estuary. One of the most human-altered estuaries on the west coast of North or South America, it is governed by a complex array of agencies, plans, and laws. One mile of the delta may be affected by decisions of more than 400 agencies. See Note 22

The White House Office on Environmental Policy has convened an interagency task force of appropriate assistant secretaries to develop and implement cross-agency ecosystem management projects. The Office of Management and Budget will review the plans as part of the fiscal 1995 budget process. In 1994, the assistant secretaries will establish cross-agency teams to develop initial ecosystem management plans for implementation in fiscal year 1995. Also in 1994, the President should issue a directive that will declare sustainable ecosystem management across the federal government.

Action: The President should create a Federal Coordinating Council for Economic Development.

See Note 23

The federal government has no coherent policy for regional development and community dislocation. Instead, it offers a fragmented and bureaucratic system of seven programs to assist states and localities. The major programs are the Commerce Department's Economic Development Administration, the Housing and Urban Development Department's Community Development Block Grant program, and the Agriculture Department's Rural Development Administration and Rural Electrification Administration. The Defense Department, Tennessee Valley Authority, and Appalachian Regional Commission run smaller programs. Thus, states and communities must turn to many different agencies and programs, rather than a single coordinated system. Communities find it hard to get help, and the dispersion of effort limits overall funding.

Washington's economic and regional development activities should be reconfigured to suit its customers--states and communities. We propose a Federal Coordinating Council for Economic Development, comprising the appropriate cabinet secretaries and agency heads, to coordinate such activities and provide a central source of information for states and localities. The council will provide a unifying framework for economic and regional development efforts, develop a governmentwide strategic plan and unified budget to support the framework, prevent duplication in the various programs, and assess appropriate funding levels for the agencies involved.

Action: Eliminate statutory restrictions on cross-agency activities that are in the public interest.

See Note 24

A series of legislative restrictions make it particularly difficult to pursue solutions to problems that span agency boundaries. For instance, to put together a working group on an issue that cuts across agency lines, one agency has to fund all costs for the group. Several agencies cannot combine their funds to finance collaborative efforts. Rather than discourage cross-agency operations, the federal government should encourage them. Congress should repeal the restrictions that stand in the way of cross-agency collaboration, and refrain from putting future restrictions in appropriations bills. In addition, Congress should modify the Intergovernmental Personnel Act to give cabinet members and those working for them greater authority to enter into cooperative agreements with other federal, state, and local agencies.