Federal Human Resources Management for the 21st Century United States Office of Personnel Management Strategic Plan FY 2000 - FY 2005 September 30, 2000 . Table of Contents Our Vision Our Mission Our Values. . . . . . . . . . . . . . . . . . 1 Federal Human Resources Management for the 21st Century. . . . . . . . . 2 OPM's Strategic Goals. . . . . . . . . . . . . . . . . . . . . . . . . . .6 Our Goals and Objectives . . . . . . . . . . . . . . . . . . . . . . . . .7 Goal I Lead . . . . . . . . . . . . . . . . . . . . . . . . . . . 7 Goal II Protect . . . . . . . . . . . . . . . . . . . . . . . . .16 Goal III Serve. . . . . . . . . . . . . . . . . . . . . . . . . .19 Goal IV Safeguard . . . . . . . . . . . . . . . . . . . . . . . .25 Our Corporate Management Strategies. . . . . . . . . . . . . . . . . . . 27 Internal Human Resources Management . . . . . . . . . . . . . . . . . . 27 Internal Information Technology Management . . . . . . . . . . . . . . . 30 Internal Financial Management . . . . . . . . . . . . . . . . . . . . . 32 How Our Strategic Plan Relates to Our Annual Performance Plans . . . . . 34 Our Operating Environment . . . . . . . . . . . . . . . . . . . . . . . 35 Our Stakeholders . . . . . . . . . . . . . . . . . . . . . . . . . . . . 35 Cross-Cutting Functions . . . . . . . . . . . . . . . . . . . . . . . . 35 Key External Factors . . . . . . . . . . . . . . . . . . . . . . . . 35 Program Evaluation . . . . . . . . . . . . . . . . . . . . . . . . . 39 Appendix A: A Closer Look at OPM . . . . . . . . . . . . . . . . . . .A-1 Our Recent Past. . . . . . . . . . . . . . . . . . . . . . . . . . . . .A-1 Our Current Role. . . . . . . . . . . . . . . . . . . . . . . . . . . A-1 Our Legal Authority . . . . . . . . . . . . . . . . . . . . . . . . . A-5 Appendix B: Pertinent Evaluation Studies . . . . . . . . . . . . . . . .B-1 . OUR VISION Great Government Through Great Employees How well the Federal Government works depends on Federal workers. Our role at the Office of Personnel Management (OPM) is to help agencies get the right people in the right jobs with the right skills at the right time so they can produce results for the American people. To do this, we work with agencies to create systems to recruit, develop, manage and retain a high quality and diverse workforce, and to do it in the right way. Congress has entrusted us with regulating these systems, and the President relies on us to continuously improve them. Our vision is a Government that meets and often exceeds the public's expectations because of the impressive competence and commitment of Federal employees. OUR MISSION To support the Federal Government's ability to have the best workforce possible to do the best job possible, We lead Federal agencies in shaping human resources management systems to effectively recruit, develop, manage and retain a high quality and diverse workforce; We protect national values embodied in law, including merit principles and veterans' preference; We serve Federal agencies, employees, retirees, their families, and the public through technical assistance, employment information, pay administration, and benefits delivery; and We safeguard employee benefit trust funds. OUR VALUES Our core values are constant and embody: respect for institutions of democracy, a civil service based on merit principles, the dignity of the individual employee and customer, and the ability to change and adapt. We are committed to maintaining an environment that fosters: Our greatest strength: the skills and knowledge of the OPM family; A work ethic that constantly strives for high quality and customer satisfaction through excellence, innovation and creativity; Equity, integrity, fairness and loyalty in all aspects of our work relationships; A workforce that reflects the high quality and diversity of our society; Leadership and empowerment at all levels through clear and open communications; Partnership at all levels with responsible and accountable participation; Improved services through cross-functional collaboration, teamwork and recognition; Continuous development and learning at all levels; and A balance between work and family. . FEDERAL HUMAN RESOURCES MANAGEMENT FOR THE 21ST CENTURY In the midst of change, we focus on people. The Federal Government is changing. Like other organizations, we are experiencing the impact of the knowledge-based economy, dramatic advances in technology, increased emphasis on results, and rising expectations of our customers. The Federal workforce is also changing, demanding more opportunities for learning, becoming more diverse, and expecting more flexibility and support in the workplace. And the pace of this change in the work we do, the way we do it, and the workforce available to do it is accelerating. Today, the American public demands that all parts of our Government clearly demonstrate their value by focusing on goals that really matter and by working more effectively and efficiently to achieve those goals. This means that Federal agencies must have the right people, in the right jobs, with the right skills, at the right time. And because we are the Government, we must do this in the right way. Strategically managing the 1.8 million members of the Federal workforce during this time of change will have more impact on how well the Government performs than any other action taken by Federal leaders. We must find better ways to manage the Government's most valuable resource, its employees. This management challenge is great. From January 1993 to January 2000, the Federal Government civilian workforce was reduced by 384,000 employees. Many of those who left were among the most experienced professionals in their agency. Even as the workforce became smaller, new responsibilities and new ways of doing existing work combined to demand new skills. Additional skill losses will occur as the baby boomer generation reaches retirement eligibility over the next five years. Today's robust economy and a nationwide shortage of skilled workers challenge the Government's ability to recruit and retain the high quality and diverse workforce it needs now and in the future. We must develop human resources management strategies that are up to the task. We at the Office of Personnel Management (OPM) are not alone in recognizing this imperative. The President's Management Council, the National Partnership Council, members of Congress, the Human Resources Management Council, the Chief Financial Officers Council, the Chief Information Officers Council, the General Accounting Office, and the National Academy of Public Administration are just a few of the groups who have stressed the importance of effective Federal human resource management strategies. We at OPM must lead this change, but we do not face the challenge alone. Federal human resource management (HRM) is a governmentwide responsibility involving OPM, the senior leaders, line managers, and HRM staffs of individual agencies, and union partners. OPM facilitates broad collaboration among these groups to identify top priorities and create solutions to particular challenges by chairing the Human Resources Management Council, chairing the National Partnership Council, sponsoring the Human Resources Technology Council, and convening meetings and workshops around special topics. We are also taking direct action to introduce change. We are redesigning the basic Federal systems for recruitment, examining, pay, classification, training, and performance management to provide the flexibility agencies must have to manage their people and achieve their mission. We are also using automation to make these systems highly efficient and customer friendly. Many of these changes have already been introduced; others still need the consensus of our stakeholders before we can move forward. The specific objectives described under our strategic goals indicate when to expect some of the major changes that are underway. We also expect that new ideas for change will be proposed over the coming years. We are increasing awareness that initiatives such as strategically-planned training, family-friendly workplace policies, and genuine partnerships between labor and management will help agencies meet mission goals. We are also sending a clear message that if we are to obtain the skills and talents we need to be successful, we must tap into the rich diversity of American society, including minorities, women, and the disabled. Diversity is something we seek not for the benefit of our minority communities, but because diversity brings strength and vitality to our organizations. We have delegated broad HRM authorities to agencies and encouraged agencies to redelegate them to line managers, so they can introduce and use all of these new approaches to recruit, examine, hire, manage, train, assess, and reward employees in ways that best meet agency needs. As we delegate HRM authorities and create additional flexibilities for exercising those authorities, we recognize that we must continue our careful oversight to ensure that managers act within the fundamental values of our Federal public service which serve us well as an employer. The merit system principles embody those values, and they remain unchanged. We will always balance the need for flexibility with accountability and respect for the principles of merit-based personnel decisions, veterans' preference, and workforce diversity. Delegation and deregulation also call for a new role for human resources staffs in agencies, who must now serve managers not as transaction processors, but as strategic partners. We will help agencies build the competencies of their human resources staff, so they can step out of their traditional role and become advocates and consultants. Over the next five years, we will focus on strategic human resource management. We are encouraging agencies to align human resources management in support of mission accomplishment. HRM alignment means first recognizing that people are the most important element in delivering results, and then taking the steps necessary to develop and support the workforce as they do their jobs. It also means holding managers accountable for effectively using their human resources to reach strategic goals. Our four strategic goals describe how we intend to promote and guide the changes required to improve how the Government manages its workforce to achieve results. We will lead in the development of flexible, yet consistent HRM policies; we will protect the merit system; we will serve agencies and other customers with helpful tools and technical advice; and we will safeguard Federal employee trust funds. We invite you to read the objectives under these goals. They describe the specific actions we will take toward strategic human resources management. Our Internal Strategic Human Resources Management OPM's employees are our greatest resource in carrying out our responsibilities. We are focusing on updating and maintaining the capacity and expertise of our employees through workforce management and investment in building competencies. We need HR professionals who understand the laws and regulations of the traditional Federal human resources system, the needs of agency line managers and human resources staffs, and the technology available to support HRM work. All of our employees must be able to craft and apply flexibilities within the current system to help agencies meet their particular needs. They must also be able to ensure that non-traditional Federal HRM systems maintain the fundamental values of a merit-based Government. In addition, with 50 percent of our Senior Executive Service (SES) and GS-15 corporate level executives eligible for optional retirement over the next five years, we are engaging in comprehensive workforce planning that focuses on anticipating new leadership requirements and strengthening the identified leadership competencies to provide a cadre of high potential candidates for these positions. Changes in Our Strategic Plan In this revised Strategic Plan we define how we will shape human resources management to ensure Federal agencies are able to recruit, manage, and keep the best people to do the work of our Government. To revise the plan, we used the results of our own policy studies, consulted extensively with our stakeholders (an overview of our stakeholders is provided in the section on our operating environment) and, specifically, benefitted from the views of the Human Resources Management Council, the Congress, the Office of Management and Budget, the Merit Systems Protection Board, the General Accounting Office, the National Academy of Public Administration, and OPM's Inspector General. We responded to comments from our stakeholders by making our plan a clearer, more concise explanation of what we intend to do, how we intend to do it, and how we will measure our success. Our goals and objectives are restated to be more outcome oriented, although they do not depart at all from the mission set out in our original plan. We halved the number of objectives which are the key initiatives we will undertake to achieve our goals in order to be clear that they are our highest priorities. Where appropriate, we added time lines that take into account resources and funding, the importance and complexity of the issue, the need for a phased approach, and time for effective collaboration, partnership and change implementation. We describe strategies for each goal that reflect the general methods we will use to accomplish our work in support of that goal. Because we will use many of the same strategies to accomplish the objectives under each goal, we avoided redundancy by describing strategies for the goals, not the objectives. Throughout the Plan, we maintain our focus at the strategic, long-term level, leaving the discussion of more specific, shorter-term strategies and actions for our annual performance plans. We have redefined how we will measure our results. We created a new measurement framework to support our improved focus on outcomes. First, we reduced the number of measures, retaining in the Plan those which provide a clear picture of our corporate achievement at the strategic goal level. The measures are not intended to be precisely linked to specific objectives or strategies. Instead, they will work together, following a balanced measures approach, to provide a complete picture of our progress toward our strategic goals. They provide the framework for more specific measures, targets, and baselines for each objective that will be described in our annual performance plans. Second, we identified what we at OPM should be held accountable for achieving and what we can only influence. For example, the ultimate outcome of our first goal is a high quality and diverse workforce. We chose each of our objectives because we believe that they will contribute toward this ultimate outcome. It is the outcome we expect to result from our leadership, but we cannot achieve it ourselves. Instead we must rely on the combined actions of Federal agencies as they carry out their delegated management responsibilities. However, while we cannot be held solely accountable for the quality or diversity of the workforce, we can and should be held accountable for providing agencies the policy leadership, guidance, tools, and technical assistance that help to recruit, manage, develop, and retain that workforce. When you read our Plan, you will see that the measures under the first two goals are divided into (1) the "strategic impact measures" of the ultimate outcomes we aim for but can only influence; and (2) the "program impact measures" of the intermediate outcomes for which we should be held accountable. For both sets of outcomes, we will use a balanced measures approach, measuring mission results and cost-effectiveness, assessing customer satisfaction, and gathering employee views. Whenever possible, we will rely on direct objective and perceptual measures from our own internal or recognized external sources. We use surrogate measures when direct measures are not available or when obtaining the measures would require resources beyond those allocated. We also recognize that there is a lack of consensus regarding the best human resources management measures, so we will continue our search for more broadly accepted measures and introduce them when available. Although this new measurement framework clarifies which outcomes we can only influence, we believe our role as the President's agent for human resources management obliges us to track and report on the ultimate outcomes in our performance reports, and we will do so. Measuring movement toward the ultimate outcomes will also help guide the strategic focus of human resources management programs in OPM and in agencies over the long term. The new measurement framework represents a shift only in the way we report our results, rather than a change in the focus of our work. It will enable us to more clearly identify our agency achievements, which will make our performance reports more useful to Congress and the public. . OPM'S STRATEGIC GOALS Goal I Lead. The Federal Government effectively recruits, develops, manages and retains a high quality and diverse workforce even as the labor market and workplace undergo significant and continuous change. Goal II Protect. The Federal Government, as an employer, consistently honors merit principles in managing its workforce. Goal III Serve. OPM's high quality, cost-effective human resources services meet the evolving needs of Federal agencies, employees, retirees, their families, and the public. Goal IV Safeguard. The employee benefit trust funds are models of financial excellence and integrity. . Our Goals and Objectives Goal I Lead. The Federal Government effectively recruits, develops, manages and retains a high quality and diverse workforce even as the labor market and workplace undergo significant and continuous change. The ultimate outcome of this goal is a high quality and diverse workforce, which we define as a workforce that produces the results that accomplish agencies' missions. The intermediate outcome, for which we are responsible, is providing leadership to ensure that agencies have the tools and policies they need to achieve this ultimate outcome. We have set the following strategic objectives as key actions to meet this goal. Agencies have a model for workforce planning, analysis and forecasting, plus a number of state-of-the-art tools and strategies for recruitment, selection, development, and succession planning by FY 2001, and, in future years, will have continual enhancements to meet needs yet to be identified by agencies. Federal agencies must rely on workforce planning to ensure they have the right employees with the right skills, can select and develop effective supervisors and program managers, and maintain a sufficient pool of experienced people for executive positions. These needs result from the growing importance of information technology, changes in the nature of work, an expected surge in retirements by skilled workers, and further expected reductions in the workforce. Effective workforce planning involves the right mix of recruiting new employees and developing current employees. Agencies are turning to us for help to avoid costly duplication of efforts in creating analysis tools and new strategies to meet skill needs. A flexible, competitive and performance-oriented strategic rewards environment that allows the Government to recruit, manage, and retain a high quality and diverse Federal workforce is developed by FY 2002. OPM is using a strategic rewards perspective to improve the Federal Government's pay and benefits systems. This broad perspective includes traditional compensation and benefits, as well as other elements of the work experience, such as support for continual learning, work/life balance, and a culture of leadership excellence, that are recognized as major factors in attracting and retaining employees. To apply this strategic rewards perspective in our policy and program development, we established a Strategic Compensation Policy Center and a Benefits Design and Delivery Center. We are coordinating a comprehensive approach to strategic compensation issues, researching best practices, and working with stakeholders to examine alternatives and formulate policy proposals for consideration by Congress by the end of FY 2002. In the meantime, we will take steps to ensure that agencies are aware of and using the broad array of existing strategic rewards programs. We will also work closely with stakeholders to proceed with more immediate initiatives through administrative leadership, regulatory actions, and legislative proposals, as appropriate. Once new compensation options, benefits, and other strategic rewards programs are put into effect, we will help agencies implement them in ways that most effectively meet their strategic goals. We will also continue to help agencies improve their performance management and results measurement programs to align employee and organizational performance and sustain clear accountability. Effective programs and measures are critical to ensuring that strategic rewards are driven by performance. Federal agencies have an increased understanding of and commitment to a family-friendly workplace culture that helps workers balance their careers and personal responsibilities, and that contributes to agencies' ability to effectively recruit and retain employees. (Ongoing) The most competitive companies in the private sector have learned that family-friendly programs help them attract and retain the best workers. As the number of dual-earner families grows, the demands of both work life and personal life converge to increase stress and challenge workers' capacity to manage all of their responsibilities. Family-friendly and wellness programs are emerging as important determinants of where a person chooses to work. To be strongly competitive and become an employer of choice, the Federal Government must offer a full range of benefits and personnel flexibilities that can be adapted by employees with differing and ever-changing needs. We will meet this objective by encouraging the full use of existing flexibilities and by studying the need for, and promoting, new initiatives. By FY 2004, human resources development strategies result in Federal training that is better linked to agency strategic goals, is more measurable, and is more outcome oriented. The need to integrate training into agency strategic planning processes is a documented and emerging need that all agencies have been asked to address in their FY 2002 annual performance plans and budget submissions. Our challenge will be to assist agencies in making the cultural changes needed to view training as an investment in the workforce that will result in better mission accomplishment. Our role will be to provide leadership, guidance and assistance to agencies, to work collaboratively to promote the positive impact of integrating training into agency mission, and to expand the skills of the training community. In particular, we will identify and promote models of training goals and measures that are results oriented and aligned with agency mission. Federal agencies have an increased understanding of and commitment to effective and cooperative labor-management relationships that continually improve performance and service to the public. (Ongoing) Genuine partnerships between labor and management are a proven strategy for helping agencies deliver better, more cost-effective service and for improving the quality of employee worklife. We will work with agencies and unions to promote the development and growth of partnerships; we will examine trends in labor-management relations and identify strategies for creating successful partnerships; we will collect and disseminate information on effective labor-management relations; and we will highlight best practices and lessons learned. Agency hiring incorporates new hiring authorities, computer technology and state-of-the-art applicant assessment tools to identify and quickly select a high quality and diverse workforce. (Ongoing) The currently tight labor market for skilled workers has led employers to seek better ways to reach persons with the right skills and to use technology to speed the assessment process. Examples of immediate initiatives to meet these needs include: using the Internet to help college students identify careers and job opportunities in the Government; identifying and targeting key sources for recruiting diverse, skilled workers; developing flexible, cost-effective governmentwide intern programs (for example, the Federal Career Intern Program that will be implemented in FY 2001); and taking full advantage of computers for all aspects of getting agencies the people they need. We will also take action to promote the public service and the Federal Government as a competitive employer. By FY 2002, existing programs and flexibilities plus new initiatives support the retention of employees whose departure from Government service would mean a loss of critical competencies or reduction in agency performance. In the recent past we have significantly reduced the number of Federal employees through early retirement, buy-outs, and other workforce reductions. Many of those who left were the most experienced and knowledgeable employees in their agencies. In addition, a significant portion of remaining senior employees, executives and managers will be eligible to retire in the next few years. Simultaneously, the economy and changes in work have greatly affected the Government's ability to successfully compete with other employers for talented employees. The loss of this expertise and the realization that it cannot be easily replaced with brand new employees or through training has created an awareness that we must focus not only on recruiting and development, but also on retaining our most valued employees. To do this, we will encourage the use of available retention flexibilities of all types, and design innovative approaches to retain those eligible for retirement or to regain critically needed skills of recent retirees. By FY 2004, the Government's executive resources systems appropriately distinguish leadership and technical/professional attributes and help agencies develop, select, and manage an exceptional executive corps. The technology explosion, the focus on performance-based Government, and the changing composition and fluidity of the workforce call for a different approach to management and leadership. Among the ideas fostered by our 1998 draft Framework for Improving the Senior Executive Service (SES) that deserve further study is restructuring the Government's executive resources systems. We will revisit the organization, structure, and composition of these systems to maintain the focus of the SES on finding and using highly qualified and diverse executive talent, and we will continue to refine systems for hiring and managing senior personnel. In FY 2001, we will review legislative history, studies, and reports on the structure of the SES and other senior personnel systems and develop a series of draft options for alternative structures. In FY 2002 and beyond, we will refine options and alternatives, vet recommendations with stakeholders, and develop formal proposals for Administration approval after achieving stakeholder consensus. These activities are part of our continuing efforts to enhance and refine systems for hiring and managing senior personnel. By FY 2005, governmentwide selections are based on assessment tools that are more comprehensive in assessing the full range of competencies needed to perform the jobs of the future. Using a whole-person, competency-based approach may provide a basis for developing stronger assessments that reflect the full range of competencies required for optimal job performance. Since this is a major shift in describing qualifications and designing assessment tools, we will use pilot projects to test and refine the approach in new blocks of occupations over each of the next five years. The personnel security community makes effective use of the investigative policy we establish and the leadership we provide as a member of the U.S. Security Policy Forum (SPF) of the U.S. Security Policy Board. (Ongoing) By participating as an active member of the SPF, OPM helps ensure governmentwide uniformity in the application of investigative standards by being a member of the deliberative bodies that both set and enforce policy. OPM also makes sure that its regulations and individual agency delegations and agreements reinforce the national personnel security standards. As a member of the SPF, OPM chairs the Personnel Security Committee which develops governmentwide policy, also chairs the Investigations Working Group, and has staff members on almost all of the substructure committees, working groups, and panels of the SPF. OPM has also been invited to be a member of other security community groups, including the Industrial Security Summit and the Board of Governors of the Extranet for Security Professionals. Effective and timely guidance is available to agencies for creating and using alternative dispute resolution programs that can reduce the cost of disputes, reduce litigation, and increase employee satisfaction with the dispute resolution process. (Ongoing) Experience has shown that the use of alternative dispute resolution (ADR) in the earliest stages of a workplace conflict can lead to a simpler resolution that conserves resources. As important, incorporating ADR techniques into conflict resolution processes can contribute to establishing a partnership environment and help bring about positive change in an organization's culture. We will continue to highlight the importance of ADR by promoting and awarding successful programs in agencies. Additionally, through our ADR Resources Guide, we will provide the Federal human resources community with best practices and updated information for the development and maintenance of ADR programs. We will continue to work with other leading proponents of ADR, such as the Department of Justice, the Equal Employment Opportunity Commission, and the Merit Systems Protection Board. By 2003, aligning human resources management (HRM) with agency mission, improving the capability of human resources (HR) professionals, and identifying a set of well-accepted measures for assessing improved HRM governmentwide improves the overall effectiveness of HRM. This objective is focused on helping agencies effectively conduct their human resources activities to better support their mission and to measure their progress in doing so. In FY 2001, we will embark on a collaborative governmentwide effort to identify appropriate measures of HRM effectiveness, by consulting with agencies and other key stakeholders. Also in FY 2001, we will collect baseline information on the status of the transformation of the HR workforce through our oversight program. Using this baseline data, we plan to design and produce a number of useful tools and guides for the HR professional, and by 2002 we will enhance these products to include interactive and web-based learning materials. In addition, where appropriate, we will provide governmentwide measures of organizational effectiveness for agency use. Agencies have access to more efficient and effective governmentwide HRM technology solutions developed through the OPM-sponsored Human Resources Technology Council (HRTC). (Ongoing) Traditionally, Federal agencies have worked independently to improve the HRM services provided to their managers and employees through the use of HRM information systems. To meet common HRM information needs, we have fostered a governmentwide approach by chartering the HRTC. The HRTC provides agencies with a forum to address common issues and to craft long-term strategic visions and action plans for governmentwide HRM information system initiatives. A key initiative of the HRTC is the Human Resources Data Network (HR-DN) project. The HR-DN will reengineer governmentwide HRM record keeping and reporting practices to facilitate the use of human resources data by a variety of stakeholders, eliminate the need for a paper employee record, enable the electronic transfer of human resources data throughout the Federal sector, streamline and improve governmentwide reporting, and complement and incorporate agency HRM information system capabilities. Clearly communicated and effective human resources management (HRM) regulations, policies, and guidance across the full spectrum of HRM continue to support agencies' missions and to carry out the will of the Congress and of the President, as expressed in law and directive. (Ongoing) A primary OPM responsibility, reinforced by over a century of civil service laws and Presidential directives, is to see that those laws are properly implemented and to exercise our regulatory and policy authority in a way that best serves national interests. In areas where the legal authorities are broad, we improve existing policies and guidance to ensure that they cover emerging situations, practices and technologies. It is also our responsibility to continually consider both tested and new ideas, and suggest new legislative initiatives to meet evolving human resources management needs of the Federal Government as a whole. In the immediate future, we will work closely with all of our stakeholders to develop specific legislative proposals to address current needs. STRATEGIES FOR ACHIEVING GOAL I We will: Collaborate and consult with: Agencies and interagency groups such as the Human Resources Management Council, the Human Resources Technology Council, the Human Resources Development Council, Performance America, and others to leverage resources and to create new initiatives to meet agency needs, and to ensure that laws, regulations and Presidential initiatives are fully implemented; Labor organizations, management associations, and other employee groups to ensure that our policies, guidance, and other initiatives reflect their interests and perspectives and benefit from their expertise; Experts both within the Federal Government and elsewhere, such as the National Academy of Public Administration Performance Consortium, the Competency Consortium, the Emotional Intelligence Consortium, and the Human Resources Institute, to incorporate their research results and leverage their expertise in developing proposals for HRM programs; and Our oversight agencies and congressional oversight committees to design appropriate legislative proposals and implement the resulting policies. Use benchmarking and other techniques to obtain and evaluate new approaches that apply the best practices of public and private sector employers, taking advantage of findings from oversight reviews, demonstration projects, surveys, professional literature, conferences, and other sources; Write policies and guidance in plain language and communicate them broadly through a variety of channels; Conduct studies to guide us in our choice of strategies and actions to achieve our goals (e.g., research why people select or reject public service and employment with the Federal Government); and Promote the value of public service and the Federal Government as an employer of choice. MEASURES FOR GAUGING ACHIEVEMENT OF GOAL I Ultimate Outcome: A high quality and diverse Federal workforce that produces the results that accomplish agencies' missions. Strategic Outcomes Strategic Measures High workforce quality Extent of agreement by Federal human resources (HR) directors and staff and by line managers (at all levels, from supervisors through top level executives) that their workforce enables their agency to meet its mission (sources: OPM surveys of HR directors, HR staff, and line managers; studies by the Merit Systems Protection Board, General Accounting Office, National Academy of Public Administration, etc.) Diversity in the Federal workforce Extent to which diversity in the Federal workforce is equivalent to the relevant American labor market (sources: workforce statistics from the Dept. of Labor, our Central Personnel Data File and reports from the Federal Equal Opportunity Recruitment Program and the Disabled Veterans Affirmative Action Program) Organizational results are achieved Extent to which agencies are meeting their performance goals (sources: individual agency performance plans and reports; Office of Management and Budget governmentwide performance reports; studies by the Merit Systems Protection Board, General Accounting Office, National Academy of Public Administration, etc.) Supportive organizational environment for productivity Extent to which Federal employees agree that agencies are providing a workplace that supports productivity and well-being (source: governmentwide employee surveys, e.g., annual OPM/National Partnership for Reinventing Government employee survey) Improved public satisfaction with services delivered by the Federal Government Public perception of Federal Government customer service compared to private sector customer service (sources: American Customer Satisfaction Index; other public surveys) Intermediate Outcome: OPM provides effective HRM leadership. Strategic Outcomes Strategic Measures Effective collaboration to address governmentwide HRM challenges Extent of expressed satisfaction by HR directors and Government policy leaders that OPM is collaborating effectively with others and generating effective HRM actions strategies (sources: surveys of HR directors; direct feedback from HR directors and policy leaders) Federal HRM is increasingly aligned with mission accomplishment (i.e., agencies practice strategic human resources management workforce analysis, succession planning, integrated recruitment, retention, training, and strategic rewards planning) Direct actions are taken by OPM and others to support increased HRM alignment. Evidence that an increasing number of agencies are properly integrating HRM into action plans for accomplishing agency mission, and that HR professionals are full partners in agency planning. (sources: evidence of actions taken; feedback from OPM oversight reviews and studies and external studies support conclusion of increased alignment ) Increased agreement that OPM provides useful HRM policy guidance, programs, and strategies Extent of use of OPM's HRM policy guidance, programs, and strategies, e.g., accountability systems, labor-management partnership initiatives, alternative dispute resolution programs, continuous learning programs, and recruitment and retention strategies (source: reports from HR directors, HR staff, line managers, SES members about usage) Extent of agreement by HR directors, HR staff, and line managers that OPM's HRM policy guidance, programs, and strategies are effective (sources: OPM customer satisfaction surveys of HR directors, HR staff, line managers, SES members; oversight review reports; special studies; and reports from agencies) Program evaluation study findings that products are useful (sources: special internal studies; external studies by the Merit Systems Protection Board, General Accounting Office, National Academy of Public Administration, etc.) Response to proposed regulations and other actions published in the Federal Register (source: comments from stakeholders) HRM improvements result from OPM actions and leadership Results from governmentwide surveys indicate improvements in overall HRM (source: OPM's Merit System Principles Questionnaire (MSPQ), surveys from other organizations, e.g., MSPB) Impact of actions required and recommended in OPM oversight reports; utility of report findings for other agencies; human resources management improvements in agencies resulting from evaluations, and scope and number of governmentwide policy improvements fostered by evaluations (source: results from balanced scorecard used in oversight Outcome Assessment Reports) Adherence to commitments and project timetables Degree to which we do what we say we will do, in the time frames we promise (sources: OPM Annual Performance Reports; specific program plans, e.g., Workforce Planning Model) Governmentwide costs for HRM are reduced, or avoided Comparative cost data and cost-benefit analyses, e.g., for information technology initiatives, indicate savings or cost avoidance; subjective information, e.g., justifications from agencies nominating their alternative dispute resolution program for the annual Director's award, describe cost savings (sources: specific program cost-analyses; analyses of award nominations, etc.) . Goal II Protect. The Federal Government, as an employer, consistently honors merit principles in managing its workforce. The ultimate outcome of this goal is consistently honoring the merit system principles, which the law sets forth as the foundation of an effective, well-managed Government. The intermediate outcome, for which we are responsible, is an effective oversight program. The strategic objectives we describe below help ensure that agencies meet this goal. Agencies continue to adhere to the merit system principles and other laws, rules, regulations and public policies governing human resources management even as flexibilities increase and new systems are introduced. (Ongoing) By law, we are charged with ensuring that human resources activities comply with merit system principles. Through our oversight reviews, we know that agencies currently adhere closely to these principles, but there are occasional lapses. These lapses could become more common as agencies and their line managers are delegated more authority to make HRM decisions, strict regulations are replaced by more flexible guidelines, seasoned human resources staff retire, and local human resources services are consolidated. We assess HRM at the 30 largest agencies on a 4-year cycle and smaller agencies on a 5-year cycle, and also conduct special reviews when warranted. This objective also covers actions to inspect and evaluate agencies' personnel security and suitability programs, to identify deficiencies in agency programs and recommend corrective actions. By FY 2005, all agencies have implemented accountability systems that effectively hold responsible officials accountable for their human resources operations and results. Delegation, deregulation, and downsizing call for this emphasis on management accountability. Authority to make many HRM decisions historically has been held in the human resources office (for example, classification). While managers participated in these decisions, the human resources office often retained final authority. The new, though still evolving, Federal HRM model places more direct responsibility for HRM on those whose immediate task is mission accomplishment line managers. These managers, supported by the human resources staff, must be given authority to manage human resources and then be held accountable for the results of their decisions. The new model does not abandon compliance concerns, but rather represents a major shift in balance toward outcomes and results. We will continue to review internal agency HRM accountability systems as part of our regular oversight reviews. Also, in FY 2001, we will implement a new accountability oversight protocol for alternative personnel systems. We plan to evaluate the results of the FY 2001 reviews in FY 2002. With regard to our education initiatives, in FY 2001 we plan to produce a web-enabled tutorial on the merit system principles in order to accelerate the education of Federal managers about the merit system principles. By developing tools for testing the effectiveness of accountability systems and by working to educate managers about the merit system principles, we are continuing to promote the importance of agency accountability systems. All agency units that conduct employment examinations under our delegated authority are fully trained, covered by effective internal examining accountability systems, and meet our criteria for recertification. (Ongoing) Most employment examinations are now conducted at an agency's own site to meet specific needs. Although we have delegated examining authority to agencies, we retain legal responsibility to ensure that the examining is done correctly. Human resources offices in many agencies have restructured and downsized, lost experienced staff, and face heavy turnover. These realities require a positive effort to train and inform examiners about applicable laws and regulations, including merit principles. Toward this end, we are steadily expanding resource materials available through the Internet (with a new handbook posted in FY 2000) and training and certifying delegated examining unit staff (with a heavy emphasis on training in FY 2001). Decisions of Federal adjudicatory agencies and decisions of OPM in acting on appeals are consistent with civil service laws, regulations, and policies. (Ongoing) At times we must intervene to interpret our own regulations and policies when they are involved in cases decided by other bodies. Third party decisions that are not consistent with civil service laws, rules, and regulations could potentially affect the entire Federal Government. We also are authorized by Civil Service Rule 5.1 to grant exceptions to our regulations in the face of hardship, where the intent of the regulation can be preserved. STRATEGIES FOR ACHIEVING GOAL II We will: Evaluate human resources management compliance and effectiveness at agencies on a cyclical basis and as special needs arise; Help prevent violations and abuse of the merit system by putting all policy information on the OPM website for immediate, easy access by line managers who need the information on a just-in-time basis; Make agency personnel security and suitability programs more effective through evaluation of their programs; Develop and test alternative methods of oversight/merit system review in response to the increase in alternative personnel systems; Develop standards and other aids for testing the effectiveness of accountability systems; Pursue appropriate legislative, regulatory or executive actions to support the use of agency accountability systems; Provide agencies with a variety of tools (e.g., video, pamphlets) to help managers understand and apply the merit system principles; Develop automated training and policy resources for delegated examining operations in agencies and guide the development of agencies' internal accountability systems for those operations; and Identify, analyze, and, when necessary, act on those third party decisions warranting our formal intervention, reconsideration or judicial review. MEASURES FOR GAUGING ACHIEVEMENT OF GOAL II Ultimate Outcome: The merit principles are consistently honored. Strategic Outcomes Strategic Measures Governmentwide perceptions of equity and merit are improved. Extent of agreement by Federal managers and employees that the nine merit system principles are adhered to within their agencies. (source: governmentwide results from OPM's Merit System Principles Questionnaire (MSPQ) and surveys conducted by others such as the Merit Systems Protection Board) Intermediate Outcome: We maintain effective oversight of the merit system. Strategic Outcomes Strategic Measures Increased HRM accountability governmentwide Analysis of feedback from reviews, studies, and surveys indicates that agencies are taking increased responsibility for assessing how effectively they are conducting internal HRM (sources: reports from oversight reviews and special studies; MSPQ data) HRM improvements in individual agencies result from OPM merit system reviews Specific improvements made based on actions required and recommended by OPM in agency evaluation reports (source: results from balanced scorecard used in OPM's oversight Outcome Assessment Reports) Oversight review and personnel security/suitability inspection schedules are met Comparison of numbers of oversight reviews and personnel security/suitability inspection reviews conducted each fiscal year with schedule of reviews (source: records of reviews/inspections) High agency customer satisfaction Extent of agency customer satisfaction with the conduct, quality, and timeliness of specific agency evaluations, reviews (sources: balanced scorecard used in OPM's oversight Outcome Assessment Reports; satisfaction of agencies with personnel security/ suitability inspection visits ) . Goal III Serve. OPM's high quality, cost-effective human resources services meet the evolving needs of Federal agencies, employees, retirees, their families, and the public. Since the delivery of most of our human resources services is within our span of control, there is no need to distinguish ultimate and intermediate outcomes. The following objectives help us achieve high quality cost-effective services that meet the evolving needs of our customers. Our technical assistance and information on human resources policies and programs are timely, useful, accurate, accessible, and user friendly. (Ongoing) To explain laws, regulations, and policies and to give expert advice, each year we handle many thousands of phone calls, letters, email, visits, and speaking engagements. Our primary goal is to support the human resources professionals in the agencies, but we also handle inquiries from congressional staff, stakeholder groups, current employees, job-seekers, and other citizens. We conduct conferences on specific human resources management topics to provide the most current guidance and to share best practices with agencies. We also team with agencies and groups of agencies to solve common problems and to enhance the capability of human resources professionals. Direct HR services to agencies (both reimbursable activities tailored to specific agencies and non-reimbursable activities conducted under statute for all agencies) provide cost-effective choices to meet individual and governmentwide customer needs. (Ongoing) There is a need for cost-effective and high quality human resources services to assist agencies in achieving a high quality and diverse workforce and to contribute to governmentwide cost savings through economies of scale. OPM will continue to provide broad policy assistance to agencies as a core responsibility. As provided under current law, we will also offer a broad variety of in-depth, tailored staffing and other human resources management products and services to agencies on a reimbursable basis, when they request such services. For both reimbursable and non-reimbursable assistance, we will maintain our focus on meeting the evolving needs of our agency customers by providing top quality service and ensuring that the products and services we offer are cost-effective and use the most up-to-date methods and practices. The following major human resources programs continue to provide and improve governmentwide cost-effective service that meets or exceeds customer expectations. (Ongoing) USAJOBS Timely, accurate, and complete employment information is available for employees and the public. To fulfill the merit principle that Federal jobs should be filled through fair and open competition, to widely provide job information to the American public, and to enable agencies to reach a rich pool of candidates, USAJOBS posts Federal job vacancies and allows on-line applications. It uses the Internet, phone menu systems, and data kiosks in Federal buildings and public colleges and universities to reach millions of job seekers each year. This centralized job information source is economical for the Government and provides one-stop access for job seekers. The system is continually enhanced to make it ever more user-friendly to all, including those with disabilities. For example, in FY 2001, job seekers will be able to complete a job interest profile and then be notified by email of jobs that match their interests. Central Personnel Data File (CPDF) Accurate and timely workforce statistics and information are available to decision makers. CPDF is the primary national source for Federal civilian employee statistics. The file dates from 1972 and currently covers 1.8 million employees. Program offices within OPM, central management agencies, the Congress, and many academic customers routinely rely on CPDF information. In FY 2000 our CPDF modernization agenda included items such as expanding the electronic CPDF submission capability to all agencies, establishing baseline performance of CPDF processes, and beginning a customer feedback program along with an ongoing data quality assurance program. In FY 2001 and FY 2002 we will devise and implement solutions for improved system performance, error prevention and public assess to self-serve CPDF data. Compensation Administration Timely and accurate information and assistance are available to decision makers for pay and leave administration purposes. Federal law authorizes or requires us to regulate or administer more than 50 separate statutory provisions governing pay and leave for Federal civilian employees. We provide advice and assistance to agencies implementing these statutory provisions, including annual pay adjustments, so they can attract and retain a competent workforce. Our success is measured by whether we meet strategic deadlines, including timely publication of new pay schedules and the annual report of the President's Pay Agent, satisfy the needs of agency human resources directors and specialists, and provide an increasingly wide range of information through electronic means. Insurance Program Benefits These benefits are flexible, comprehensive, quality driven, and based on informed choice. If the Federal Government is to continue to provide its employees with one of the Nation's best employer-based insurance programs, then we must ensure that these programs provide customers with flexible and comprehensive benefits. Further, these benefits must be delivered by high-rated providers in a quality-driven, cost-effective, and timely manner. To achieve this, we have strengthened the Federal Employees Health Benefits Program by implementing the Patient's Bill of Rights, pre-tax withholding of premiums and mental health and substance abuse parity. We now use the industry standard Consumer Assessment of Health Plans Survey instrument as a tool for measuring health plan performance and are exploring additional measures of the quality of provider performance. We are also focusing attention on actions to increase patient safety and reduce medical errors. We will build on these enhancements by implementing a long-term care insurance program by FY 2002. "During FY 2001, we will develop the implementing regulations and guidance for the Long Term Care Security Act, develop consumer information and an educational program for potential enrollees, and conduct an enrollment open season, as required by the Act." Further, we will explore new flexible benefit offerings. If we effectively communicate with our customers regarding provider performance and the availability and cost of these options, they will be able to select the benefits that best meet their needs. To implement these improvements, we will continue to take advantage of technology, communicate in plain language, promote the accreditation of insurance carriers, and collaborate with the health care industry to promote the use of health care outcome measures. We will know we have achieved this objective when the majority of people covered by these programs are enrolled with accredited benefit providers and are satisfied with the quality of their providers' services. The competencies and leadership effectiveness of Federal executives and managers continuously improve through training, development, and voluntary mobility. (Ongoing) We need to ensure that agencies select new leaders who can manage present challenges and keep growing to meet new ones, and that current leaders continually learn and grow to address changing conditions and managerial requirements. We will continue to offer training and development opportunities for executives and managers through our Federal Executive Institute and our Management Development Centers, and in other appropriate fora. In FY 2002, we will survey SES members to determine if more executives are taking advantage of self-development and mobility opportunities. Retirement system services are continuously improved and enhanced, and, by FY 2009, a more efficient modernized retirement system will be fully implemented that will provide prompt, accurate, and consistent customer service to all stakeholders; accurate and timely payments to benefit recipients; accurate and consistent benefits counseling for eligible participants; and high customer satisfaction with all retirement services (claims processing, telephone services, and retirement counseling). A critical step toward improving the delivery of our human resources services involves modernizing the systems through which we provide benefit services to employees, retirees, and their families. Retirement Systems Modernization, relying on reengineered business processes, is necessary to meet our long-term customer service, financial management, and business goals for these services. It is also necessary to support the more complex processing required by the Federal Employees Retirement System (FERS) and the four-fold increase in FERS-based retirement claims and other work that we will receive during the next ten years. As we develop and implement this modernized system, we will leverage telecommunication and other technologies, work closely with our stakeholders, ensure that cohesive links exist with initiatives being pursued by the Human Resources Technology Council, and train our staff in customer service and information technology. We have already developed a concept of operations for the system and identified the legal requirements that our reengineered business processes must meet. We also designed the "to-be" model, which is the initial plan for our blueprint process designs, identified areas to prototype, and implemented two of them during FY 1999. In FY 2000, we created three of the six core processes blueprints and began work on the technology blueprint. The business process and technology blueprints provide the detailed layout of what functions and processes must be supported in order for the modernization effort to meet its primary goals and objectives. In FY 2001, we will complete the detailed design of the modernized retirement system, including designing the remaining process blueprints, the technology architecture, and core process requirements, developing the organizational blueprints, and preparing transition plans and additional prototyping. In FY 2002, assuming necessary funding, we will continue planning activities, perform systems analysis and design of the system, and begin acquiring the information technology that will support the modernized system. In FY 2003 through FY 2008, assuming necessary funding, we will complete the implementation of modernization's redesigned core processes, through a phased approach compliant with Clinger-Cohen Act requirements. Each implementation segment will provide business benefits. Modernization will significantly enhance retirement system performance and provide multiple options for electronic business transactions with our customers and agencies. STRATEGIES FOR ACHIEVING GOAL III We will: Work to constantly improve and enhance delivery of technical assistance, services and governmentwide programs to meet the evolving needs of customers; Take maximum advantage of technology to disseminate program and employment information, facilitate training, and serve customers; Use plain language to explain requirements and options; Improve procedures to ensure that OPM and agencies provide consistent guidance; Work with interagency groups and stakeholders to deliver integrated human resources solutions that leverage governmentwide automated applications, delivery channels, databases, and expertise to meet agency-specific and evolving governmentwide needs; Promote the accreditation of health carriers by the National Commission for Quality Assurance and other accrediting organizations and provide consumers with accreditation information; Collaborate with health care industry representatives, the National Commission for Quality Assurance, the Health Care Financing Administration, the Department of Health and Human Services, and the Foundation for Accountability to promote the use of health care quality outcome measures and improve the consumer information available to insurance program customers; Facilitate and promote executives' use of formal training, sabbaticals, temporary assignments, details, and movement within and between agencies to broaden their perspectives, gain fresh insights, and become more effective leaders; Train and develop executives and managers in the Executive Core Qualifications, and continue to use them as a basis for selection into the Senior Executive Service (SES); Continually assess and enhance the content and methods of delivery we use for the executive and managerial training we offer through the Federal Executive Institute and Management Development Centers; Develop and implement an internet mobility forum to stimulate and facilitate voluntary mobility among the SES corps; Form comprehensive long-term strategic alliances with key agencies and executive leadership organizations to improve individual, team, and agency performance. These alliances are designed to promote knowledge generation, capture best practices, and enhance training and development programs and services for these key customers; Complete the Retirement System Modernization Project and ensure linkage between the project and initiatives being pursued by the Human Resources Technology Council; Expand services provided by Retirement and Insurance Teleservice Centers and expand toll-free telephone access to overseas locations; and Train staff in customer service and information technology skills. MEASURES FOR GAUGING ACHIEVEMENT OF GOAL III Ultimate Outcome: High quality, cost effective services that meet the evolving needs of customers. We will measure this outcome from the five perspectives shown below, using a variety of sources appropriate for customers of each of the different services provided. This table provides examples of sources, but is not a complete listing. Strategic Outcomes Strategic Measures High quality services Extent of agreement from HR directors, HR staff, line managers, and SES members that services, tools, technical assistance, informational materials, etc. are accurate, relevant, reliable, and useful (sources: surveys of satisfaction with quality of services, etc.) Accuracy of service or information provided, based on quality assurance systems data (source: quality assurance system data on accuracy of annuity claims) Improved timeliness and/or accessibility of services The range of services, tools, and informational materials accessible on the OPM website (source: internal reports of website postings) Timeliness for providing or refreshing information, e.g., workforce data, benefits program statistical data (source: internal program reports) Timeliness of service provision, e.g., annuity claims processing (sources: RIS Management Information System; other internal management systems) High customer satisfaction User satisfaction with services provided, e.g., USAJOBS users, including agencies posting jobs and job seekers; annuitants (sources: e.g., USAJOBS website survey; Client Satisfaction Survey of Retirement Program Customers, etc.) Health Benefits Plan enrollee satisfaction (source: Consumer Assessment of Health Plans Survey) Improved cost effectiveness and/or cost avoidance Cost of service delivery, data on cost avoidance, data on governmentwide cost savings, e.g., retirement program services are delivered at less cost, more services are included in USAJOBS (sources: e.g., unit cost per retirement claim; USAJOBS costs compared to individual agency job posting systems, etc.) Executive and management training and development programs are competitively priced (source: Office of Executive and Management Development marketing plan and competitive analysis) Adherence to commitments and project timetables Degree to which we do what we say we will do, in the time frames we promise (sources: OPM Annual Performance Reports; specific program plans, e.g., Capital Asset Plan; plans for implementing Long Term Care insurance benefit.) . Goal IV Safeguard. The employee benefit trust funds are models of financial excellence and integrity. The ultimate outcome is the financial excellence and integrity of the employee trust funds. We have a single objective for this goal. The trust fund financial systems are in full compliance with the Federal Financial Management Improvement Act (FFMIA) and the Federal Managers' Financial Integrity Act (FMFIA) by FY 2003. Our financial stewardship of the employee benefit trust funds includes maintaining oversight and control of the funds' deposits, disbursements, investments and receivables. We have earned an unqualified audit opinion on all of the trust funds' financial statements in the past two years, and we plan to sustain this in the future. We will continue to pursue initiatives to resolve material weaknesses and non-conformances in the trust fund financial systems necessary to bring them into full compliance with the FFMIA and FMFIA. While we have made progress in the past several years, weaknesses persist, and so will our efforts to overcome them. STRATEGIES FOR ACHIEVING GOAL IV We will: Assure the integrity of the trust funds by: modernizing and fully integrating the trust fund financial systems and subsystems; documenting financial policies and procedures using in-house financial policy staff, supplemented by contractor support; and using financial staff to work with insurance carriers to strengthen carrier financial reporting so that all carriers submit audited annual financial statements that are in compliance with governmentwide accounting standards. Strengthen our Federal payroll office oversight and monitoring program by using in-house staff to conduct on-site visits to agency payroll offices, to review payroll records and audit findings that pertain to the administration of the employee earned benefit programs; Strengthen in-house financial oversight by recruiting auditors for quality assurance staff and cross training current quality assurance staff in financial audit and review techniques; Assure the preservation of financial management knowledge by establishing an in-house succession planning program within the Retirement and Insurance Service (RIS); and Make full use of the findings from the independent oversight provided by the Office of the Inspector General. MEASURES FOR GAUGING ACHIEVEMENT OF GOAL IV Ultimate Outcome: The Employee Benefit Trust Fund monies (revenues, disbursements, and balances) are accurate and protected from waste, fraud, and abuse. Strategic Outcomes Strategic Measures Compliance with FFMIA (which is defined as continued unqualified audit opinions; resolution of material weaknesses and non-conformances; and agreement by auditors that substantial compliance exists) Audit opinions (source: annual audit reports) Status of material weaknesses and non-conformances (source: annual FMFIA assurance reports and annual audit reports) Validation of compliance (source: Annual audit reports, Chief Financial Officer/Office of the Inspector General (OIG) reports agree that FFMIA compliance exists) Timely payment of benefits Extent to which program customers (e.g., annuitants) agree that they receive their benefit payments on time, (source: Client Satisfaction Survey of Retirement Program Customers) Cost savings and/or cost-avoidance Administrative cost per annuitant (source: RIS Management Information System) Amount of retirement benefit overpayments (source: Employee Benefit Programs Receivables Management System) Efffective oversight of Trust Fund Number of insurance carrier audits completed (source: OIG semi-annual reports) Dollar amount of questionable costs found in insurance carrier audits (source: OIG semi-annual reports) Dollars saved from audit activities; recovery rate of erroneous charges; and return on investment for audit activities (source: OIG semi-annual reports) . Our Corporate Management Strategies We cannot hope to achieve our goals and objectives unless we, as an agency, organize and manage our resources effectively. We have three internal, or corporate, management strategies to guide us: Human Resources Management, Information Technology Management, and Financial Management. Because of their critical importance, we have made them an integral part of our strategic plan. Internal Human Resources Management GOAL: We can recruit, develop, and maintain the high quality and diverse workforce necessary to accomplish OPM's current and future strategic goals with efficiency and innovation. Our employees are our greatest resource in carrying out our responsibilities. Our human resources management (HRM) practices support OPM by ensuring that we recruit and develop the workforce we need to do our work most effectively and efficiently. Our challenge is to attract, retain, develop, manage, and reward a skilled, diverse workforce in this environment of rapid technological and social change. Therefore, we will pursue the following internal HRM objectives to achieve our agency strategic goals. ú Clear and effective internal human resources policies and guidance continue to be developed, implemented, and communicated to support the strategic management of our workforce. (Ongoing) ú By FY 2003, workforce planning tools are developed and deployed. These tools enable managers to ensure that the workforce needs of the organization are met, and that the workforce is aligned in a way that best supports accomplishment of our strategic goals. ú By FY 2001, a succession strategy for SES and GS-15 corporate-level executive positions is in operation. ú By FY 2001, an incentive awards program is in place that recognizes employees for their performance achievements related to the accomplishment of our corporate strategic goals. ú By FY 2003, an effective HRM accountability system is developed and implemented to provide a mechanism for assessing how effectively OPM manages its human resources consistent with the values of the merit systems principles. ú By FY 2001, relationships with schools, organizations, and community associations facilitate recruitment of a workforce that reflects the diversity of the public we serve. ú By FY 2004, innovative employee education and training programs and practices are in place to cultivate a workforce that is flexible, optimally trained, and capable of adapting to changing technology. This includes the use of Intranet-based training and other methods that enable and encourage self development. ú Our work environment is continually enhanced and attracts, retains, and satisfies employees and contributes to OPM mission accomplishment. (Ongoing) ú By FY 2002, new technologies are implemented in human resources data management, processing, and staffing services to provide fast, accurate, and efficient human resources services. STRATEGIES FOR ACHIEVING THIS GOAL We will: Base recruitment and staffing on agencywide workforce planning information; Study baseline data for employee incentive awards, benchmark with other agencies, and seek out and test new approaches to incentive awards; Analyze demographics, enrollment statistics, etc., to identify schools, professional organizations, and community associations that offer the skills and diversity we need in our workforce; Track the progress of employee development activities to achieve core competencies, and track employment and program trends to ensure that competencies remain current; Implement recommendations from the Presidential Training Technology Task Force, and benchmark against other organizations to learn best practices and processes; Maintain a participatory and constructive relationship between labor and management that increases job satisfaction, uses innovative techniques to resolve issues, and engages the union in collaborative efforts to find better, more efficient ways to accomplish work and satisfy agency customers; Develop a succession planning strategy that uses cross-organizational placement, leadership development, career management, and mentoring to ensure that our future leaders reflect the diversity of America and are available to move into critical positions as they become vacant; Develop a formalized accountability system that helps ensure managers, supervisors, and HRM staff are aware of and are held accountable for operating in a manner consistent with the merit system principles; and Work with our managers and employees to ensure that internal human resources policies and guidance meet their needs. MEASURES FOR GAUGING ACHIEVEMENT OF THIS GOAL Extent to which we meet our annual performance and strategic goals (source: annual performance reports) Internal customer satisfaction (source: internal customer satisfaction surveys) Internal employee satisfaction with work environment (source: internal employee surveys; agency results on governmentwide surveys) Extent to which employees receive the training they need to help them meet our Core Competency framework objectives (source: internal reports) Increased hires of targeted individuals in occupations and at grade levels where underrepresentation has been identified (source: affirmative employment reports) Compliance and effectiveness of our internal human resources operations (source: program evaluation reports) . Internal Information Technology Management GOAL: Our information technology (IT) processes and infrastructure meet the evolving technology needs of our OPM program offices and the mandates of the Clinger-Cohen Act. IT will play an increasingly critical role in our ability to leverage resources to accomplish our strategic goals. Prudent application of technology will ensure that these resources are used most efficiently and effectively. The following specific objectives will help achieve our IT Management strategic goal. ú An OPM-wide IT architecture that provides a standard and secure technology environment to support our program offices is implemented by FY 2001. ú Continuing improvements to our IT capital planning, control, and development process are implemented to assure optimal decisions on technology investments and the efficient and effective design and operation of the IT systems that achieve our strategic goals. (Ongoing) ú Our mission-critical systems and information are protected by enhancements to our IT security program. (Ongoing) ú Our information resources management program, which ensures that our critical records are safeguarded, is continually improved to meet all legislative, regulatory, and other governmentwide guidance, including the Paperwork Reduction Act, Government Paperwork Elimination Act, Freedom of Information Act and Privacy Act. (Ongoing) STRATEGIES FOR ACHIEVING THIS GOAL We will: Periodically assess the IT needs of our staff, update our IT Architecture Vision and Technical Reference Model to maintain technical currency, and refresh deployed technology on a standard life cycle to sustain our IT infrastructure investment; Conduct an effective IT project review process and ensure the use of standards-based development techniques, which make certain that our capital investments in IT deliver the desired business outcomes; Provide computer security training, test, and evaluate our IT security program with the assistance of external experts, and implement appropriate security enhancements to protect our valuable resources; and Implement improved records management practices focusing on the use of technology to help store, access, and safeguard data. . MEASURES FOR GAUGING ACHIEVEMENT OF THIS GOAL Adherence to Clinger-Cohen and governmentwide directives on capital investment. Conformance of systems to our IT architecture standards (source: internal system reviews) Cost effectiveness of IT initiatives (source: financial data and IT initiative justifications) Adherence of system development efforts to project budget and schedules (source: internal review of project plans) Absence of security breaches and positive evaluation regarding security issues (source: internal and external security evaluations) Compliance with laws and regulations involving the storage, disposition, access, and protection of data and records (source: internal and external evaluations) . Internal Financial Management GOAL: We safeguard OPM's financial resources and provide financial management leadership, services, and information to OPM programs to assist them in meeting their strategic goals. In addition to the objectives below, which apply to all of our programs and accounts, specific objectives for the Employee Benefits System appear under strategic goal IV. The following specific objectives will help achieve our Financial Management strategic goal. For FY 2000 and thereafter, timely financial statements are produced for all OPM accounts, and they receive unqualified audit opinions. All material weaknesses are eliminated and there is compliance with Federal financial guidelines. (Ongoing) Accurate and timely reports are provided as required by OMB, Treasury and other Federal agencies, and Congress. (Ongoing) The timeliness and accuracy of financial services and information provided to our internal customers is improved. (Ongoing) STRATEGIES FOR ACHIEVING THIS GOAL We will: In FY 2001, evaluate and implement recommendations to improve OPM's administrative financial systems resulting from a contractor-conducted study of the systems' requirements and a gap and alternatives analysis; Develop a strong, effective financial management community within OPM; Provide needed training on financial management to the staff of the Office of the Chief Financial Officer, the financial management staff in OPM programs, and OPM managers; and Continue to address the management challenges identified by our Inspector General, until they are all resolved. MEASURES FOR GAUGING ACHIEVEMENT OF THIS GOAL Audit results (source: Inspector General, Independent Public Accountant, and GAO audits) Accuracy and timeliness of reports to OMB and Treasury (source: feedback from OMB and Treasury) Responsiveness and quality of service to our customers (source: customer feedback) Number of material weaknesses eliminated. Financial reconciliations (source: reconciliation of accounts to the general ledger and Department of Treasury cash balances) . HOW OUR STRATEGIC PLAN RELATES TO OUR ANNUAL PERFORMANCE PLANS Beginning in FY 1999, our Annual Performance Plans have been completely integrated with our Congressional Budget Justifications. Because they are linked to the budget, the details of the Annual Plans are organized by program area and funding source. The Annual Performance Plans link directly to our Strategic Plan in three ways. First, each Annual Performance Plan contains a section entitled, "Resource Summary by Goal" which has tables showing the resources (dollars and FTE) devoted to each of our strategic goals by program area and funding source. Second, the Annual Performance Plan has a section entitled, "Crosswalk to Strategic Plan" that is a complete listing of all the individual annual program goals that relate to each Strategic Plan goal and objective. Third, in the body of the Annual Performance Plan, as each program area is discussed, its annual goals are shown along with the strategic goal and objectives to which they are contributing. Thus the Annual Performance Plan clearly demonstrates how specific performance measures and incremental performance improvements are expected to achieve long-term goals and objectives. . OUR OPERATING ENVIRONMENT Our Stakeholders Our work affects a wide range of stakeholders who represent many points of view. They include the U.S. taxpayer; Congress; the President's Management Council; agency human resources directors and their Human Resources Management Council; agency leaders, line managers, and supervisors; current Federal employees; employee unions and the National Partnership Council; the many Federal Executive Boards and Associations that coordinate Federal efforts in the field; professional and management associations; Federal annuitants and their organizations; job-seekers; veterans and their service organizations; minorities, women, and persons with disabilities and their organizations; Executive and Legislative branch oversight and adjudicatory agencies, colleges and universities and their associations; displaced Federal employees; insurance carriers; charitable organizations that participate in the Combined Federal Campaign; a variety of interagency organizations; and, of course, our own employees. Cross-Cutting Functions OPM is the President's agent for HRM policy across the Federal Government, and, in a narrow sense, we do not have cross-cutting functions with any other agencies. However, we believe strongly that we share the responsibility for design and implementation of effective human resource management strategies with all Federal agencies, and we exercise this shared responsibility through the Human Resources Management Council. We also work with the Office of Management and Budget to establish the HRM component of the President's program. In addition, we coordinate with other Federal agencies when their national policies and initiatives would affect the Federal workforce. For example, we work with the Departments of Labor, Commerce (primarily Census) and Education to track nationwide population, employment, and education trends to help forecast Federal workforce needs. Through the Quality Interagency Coordination Task Force (QuIC), we work with the Department of Health and Human Services (HHS) and other departments and agencies that provide, purchase, or deal with health care matters on issues of mutual concern, such as patient safety, health plan quality, consumer information, and privacy. We also worked closely with HHS on developing the legislation that was enacted as the Long-Term Care Security Act, and we will continue to work with them, as well as with the Department of Defense (DoD) and other agencies, on implementation of the long-term care insurance program for the Federal family. We work with the Department of Labor, the Federal Labor Relations Authority, and the Federal Mediation and Conciliation Service to promote partnership and effective dispute resolution. We work with the Office of Special Counsel, the Merit Systems Protection Board, and the Equal Employment Opportunity Commission on adjudicatory issues. Key External Factors At the beginning of this Plan, we described the profound changes affecting workplaces in the public and private sectors, and their particular impact on the Federal Government. Among these are global factors such as the impact of the knowledge-based economy, the advances in technology, the increasing expectations of the public, the evolving needs of workers, and a strong focus on results. These are coupled with changes in the competitiveness of the economy, the general availability of skills, and the impact of an aging population on the nation's labor market. Agencies also feel specific pressures, political and internal, that affect their own HRM. Most of these changes and pressures were in effect when we wrote our first Strategic Plan, in 1997, but some have increased or decreased in importance. We carefully evaluated the factors that were likely to have the most impact on achieving our goals, and those factors are summarized here. Governmentwide Issues Title 5 of the U.S. Code provides most of our authority to carry out laws and to represent the President in managing the Federal civil service. However, some agencies seek independence from coverage by title 5, at least to the extent that the laws control hiring choices, pay levels, and employee appeal rights. Interestingly, agencies that have been given legislative authority to depart from title 5, have tended, in actual practice, to establish systems that are indistinguishable from title 5, except in terms of pay. We believe this reflects a general recognition that the fundamental values of hiring and retaining a diverse workforce on the basis of merit, treating employees fairly, and granting hiring preference to veterans who served during times of conflict remain appropriate for Government organizations. Nevertheless, we expect that some agencies will continue to seek legislation that would exempt them from title 5's recruiting and hiring requirements. We agree it would be appropriate to update title 5 and permit more flexibilities; however it is also true that many alternative processes and flexibilities are already available that can reduce the complexity of the process and the time it takes to hire. Further, exemption from title 5 does not relieve agencies from the standards for selection processes required by title VII of the Civil Rights Act of 1964, as amended, and by the Uniform Guidelines on Employee Selection Procedures. The real challenge is to give agencies more authority and accountability for managing their workforce, while ensuring that their actions remain clearly consistent with the laws that have been enacted through the collective judgment of the Congress, the President, and, through a democratic process, the people. Furthermore, it is far better to make improvements in title 5 that will offer options to all agencies, not just a few, and that will provide for appropriate accountability. Strategic Goals Most Affected: I and II For the years covered by this plan, the labor market for skilled workers in the U.S. is expected to remain tight, particularly in some information technology specialties. This skilled worker shortage limits agencies' abilities to recruit and retain good employees. Agencies have some compensation flexibility to improve competitiveness, but that may not be enough under current law. Also, research has shown that a key retention factor is the employee's relationship with the first-line supervisor, so agencies need to do a good job in selecting and developing managers. They also need coherent, long-term recruitment plans and cannot rely on last-minute recruitment trips or job announcements. Unforeseen change in the focus of Government, or the methods we use to do our work could interact with the labor market and affect our ability to get and keep good employees. Strategic Goals Most Affected: I and III Actions of any branch of the Government can affect the public's trust and confidence in the Government as a whole. The public perception of public service and the Federal workforce makes a difference in how attractive the Government is as an employer. In the mid-1990's, polls showed a resumption of students' interests in public service, independent of income consideration. Strategic Goals Most Affected: I and II Relationships With Other Federal Agencies Although we have increased the delegation of human resources management (HRM) to agencies and created new flexibilities for use by managers, some agencies have retained internal HRM policies and structures that continue older, more rigid procedures and keep decisions centralized. Some agencies are also not informing managers or field human resources offices in a timely manner of changes in governmentwide HRM requirements or flexibilities. We are aggressively using our Internet website to make policy information directly available to managers, employees, and employee representatives, as well as directly to HRM professionals at all levels. Strategic Goals Most Affected: I, II, III Decisions by the Equal Employment Opportunity Commission, the Federal Labor Relations Authority, and the Merit Systems Protection Board can have a substantial impact on OPM regulations. We adjust policy guidance to ensure that agencies act in compliance with precedent-setting decisions. When, in our opinion, a third party adjudicatory agency issues an erroneous decision that could have a governmentwide impact on civil service laws, regulations, and policies, we provide our interpretations of regulations and policies to third party adjudicatory agencies and to courts. Unpredicted changes in the workforce, or the work we do could result in more or different issues requiring adjudication, thus lead to further HRM policy changes. Strategic Goals Most Affected: I and II The Human Resources Community In recent years the Federal HR community has downsized more than other professions. During the reduction, the Government lost many of its most experienced HR specialists. That loss of expertise created a need to improve HR training and increase oversight of adherence to the merit system principles. We have been working with training providers to update their curricula to recognize the competencies and skill sets needed for the expanded roles of HR professionals. Our program offices now regularly hold conferences to discuss developments in subject matter areas such as employee relations, compensation, and staffing. We have also established "train the trainers" programs and a handbook to support agencies' use of delegated examining. We have an interest in enhancing the professionalism of Federal human resources specialists, in looking at the human resources community as a whole, and in developing agencies' HRM readiness, support and flexibility. Strategic Goals Most Affected: I, II, III The Federal human resources community is dealing with many issues to which a single department or agency cannot easily devote staff. These issues include the application of new technology to human resources work, the development and measurement of the competencies needed today by human resources professionals, the simplification of position classification, and the development of performance measures for HRM work. Past experience and funding limitations suggest that agencies will band together to address these issues, often turning to us for our expertise, assistance, and project management abilities. Strategic Goals Most Affected: I, II, III . PROGRAM EVALUATION Measurement and Program Evaluation Systems Our strategic planning and annual performance measurement process emphasizes formal, quantifiable methods for evaluating our effectiveness in accomplishing our goals. Our objectives are stated as long-term, outcome-oriented performance goals, to be achieved over the foreseeable future (roughly within a 5-year period). We identified strategies and measures for each goal that will enable us to assess our achievements. We chose measures based on cost-effectiveness, efficiency, availability, reliability/validity, and meaningfulness to stakeholders. Our evaluation program emphasizes balanced, multiple measures that include achievement of mission results, cost-effectiveness, assessment of customer satisfaction, and gathering employee views. As described at the beginning of our Plan, we are implementing a new measurement framework that identifies agency-level (corporate) performance measures that track to our strategic goals and represent the factors most critical to our success, and uses these corporate measures as the primary basis for our external performance reporting. This approach is a change from our previous method of identifying and reporting performance measures that tracked to our annual performance goals. That approach led to an unwieldy number of measures which occasionally varied from one year to the next (as the annual goals varied), and which did not always clearly demonstrate that we were meeting our strategic goals. We will, however, continue to use many of the more specific measures as part of our internal program management, and will maintain and report on results where appropriate. Our corporate measures framework provides a reasonable number of consistent, balanced measures that enable us to assess agencywide progress toward meeting our four external goals and our corporate management goals. As we implement these corporate measures, we will establish target levels for them that will define success under each strategic goal. As we track the results of these measures over the duration of this strategic plan, we will identify the performance areas that need strengthening and develop annual goals to address them. Like all agencies, we are continuing to focus on the quality and reliability of the measures used to assess progress toward our goals. Our annual performance plans include specific steps being taken each year to ensure our data are sufficiently robust for decision making. Our transition to corporate measures will further strengthen the quality and reliability of our measurement data since some of these measures rely on empirical data collected from external sources. Those measures drawn from internal (OPM) sources are objective, auditable, and based on statistically valid methods. Our corporate measurement framework will be supplemented by a data validation and verification program that will include management controls and certification and will be developed in coordination with our Inspector General. Program Data Collection. Our measurement data are operationally defined and collected by specific program areas and made available via internal management information systems. Some examples of program measures include the balanced scorecard used to assess oversight reviews, usage statistics for information sites such as USAJOBS, customer satisfaction with specific policy area programs and flexibilities, customer satisfaction with service to job seekers and annuitants, timeliness of new policy issuances, and financial savings from governmentwide programs. OPM Surveys. In addition to the program-specific measurement data, we conduct two types of surveys periodically that enable us to collect information that applies across OPM programs. The Merit System Principles Questionnaire (MSPQ) is distributed to a random sample of Federal employees in the last quarter of each fiscal year, with results timed to be used in oversight reviews during the subsequent year. This survey includes questions on the perception of adherence to merit principles and human resources management effectiveness, including effective use of employees. We use this survey to track the long term view of merit within Government. Our program offices also use the results as surrogate measures of certain objectives and as indicators of needed improvements in policy implementation. However, because this questionnaire is not designed for measuring performance on our strategic goals, the survey results are used in tandem with other objective data to provide a complete picture of performance results. A first version of the MSPQ was used for reviews conducted in FY 1997 FY 1999. A new version of the survey (updated in late FY 1999 for the FY 2000 FY 2005 reviews) is significantly shorter and the questions are reorganized and refocused on the respondents' immediate experience and work unit. The data from the new version will be used as the baseline for tracking performance for the duration of this strategic plan. (We could not use the results from the earlier version as a baseline because of the significant changes in content and format.) Our second type of broad-use survey focuses on customer satisfaction with our policy leadership and technical assistance. We take these survey results very seriously and use them to guide changes in our processes and our programs. The OPM Customer Satisfaction Survey comes in two forms, one given to all agency human resources directors and one given to a random sample of human resources specialists, nationwide. We administered the surveys for the first time in 1998, and are using those results as a baseline to track improvements. In 1999, we updated the surveys to include questions about our newest initiatives and products and made a considerable effort to improve the response rates from 1998. Both versions of the survey retained their excellent internal validity and reliability, but response rates remained a problem. Fortunately, because we increased the sample size for the HR specialist, we improved the confidence level for those survey results, even with a low response rate. Unfortunately, even though more than 50% of all HR directors responded to their survey, the size of this population was too small to enable us to confidently report these results. Because of these overall low response rates, we decided to shift to a periodic instead of annual schedule for future surveys, and are looking at other delivery options to ensure we are able to obtain reliable data in the future. We also recognize the need to collect customer satisfaction information from agency line managers, as well as the HR community, and we will introduce measures appropriate for this group of customers as quickly as we can. Program Evaluations. The performance measurement and survey data are augmented by targeted program evaluations, both internal and external, geared toward providing objective and quantifiable information on specific program areas and cross-program policy initiatives. Because formal program evaluations can be costly, we schedule our internal efforts on a cyclic basis, and programs share responsibility for cross-program initiatives. We also conduct focused evaluations on critical issues as the need arises. Our program evaluation activities are conducted by our program offices and are supplemented by evaluations conducted by external contractors when necessary. We also use results from special studies conducted by our Office of Merit Systems Oversight and Effectiveness that address contemporary, cross-cutting human resources management issues. Our Office of the Inspector General also conducts periodic evaluation studies and audits of our programs which provide an additional source of internal feedback. Formal evaluations of specific OPM programs, cross-program initiatives, and more global studies of human resources management issues and challenges are conducted periodically by external organizations such as the General Accounting Office, the Merit Systems Protection Board, the National Partnership for Reinventing Government, the National Academy of Public Administration, and the groups that audit our trust funds. We use these reports as key evaluations of our programs and supplement these reports when conflicting information results. Informal Feedback. Our continuing interaction with the Human Resources Management Council provides informal feedback on our performance, as well as information regarding current Federal human resources management issues. Additional informal feedback occurs daily as our staff respond to hundreds of inquiries from agency human resources offices, managers, and employees seeking advice and guidance about specific problems or interpretations of existing laws and regulations. Program Evaluation Schedule As described earlier, internal program evaluation is conducted by individual programs or shared by programs. We are committed to the principle of conducting in-depth program evaluations in each of our major program areas over the next five years. Depending on the status and level of recent policy, statutory, and regulatory activity, program evaluation may cover policy development activities, implementation, or results. A tentative schedule for these program evaluations follows. Other evaluations, including special studies conducted by the Office of Merit Systems Oversight and Effectiveness, will address issues of special interest each year. These evaluations will be reported in annual performance plans and are not included here. . Program Evaluation Schedule General Scope or Topic* Key Issues to be Addressed General Methodology OPM Program Area(s) by FY__ Business Process Reengineering III/2 Optimum business practices for Retirement Systems Modernization. Independent review and analysis Retirement and Insurance/CFO/ OHREEO 2001 SES staffing, performance management, continual learning I/12; III/5 & 6 Contribution of SES systems to effectiveness of Federal management and meeting the needs of agency executives. Longitudinal survey of all members of the SES Executive Resources Mgt./ES/WCPS 2002 Personnel Investigations Processing System I/11 Effectiveness of technology-based, integrated system. Independent review and assessment Investigations 2002 Major components of three Executive Development Centers III/5 & 6 Impact of training on increasing employee skills, changing behavior in the workplace, and improving mission effectiveness. Kirkpatrick's four-level training evaluation model, information from oversight reviews, and surveys Executive & Management Development /OMSOE 2003 Compensation administration policy review III/1 Extent to which legislative and regulatory proposals address agency needs. Customer satisfaction survey, HRMC input, other stakeholder input Compensation Administration 2003 Expanded oversight & accountability of alternative personnel systems II/1 Merit, HRM effectiveness, and mission accomplishment in alternative personnel systems. Meta-analysis of results from oversight reviews, demonstration project evaluations, and accountability systems Merit Systems Oversight and Effectiveness 2004 Strategies for leading Federal HRD and leading/serving the development and learning needs of the Federal workforce I/8; III/4 Extent to which: agency HRD is mission focused, outcome oriented, measurable, fair, effective, and collaborative. Multiple, including targeted studies, agency reviews, focus groups, comments from stakeholders, and compliance reviews and studies done by external agencies. Human Resources Development (HRD) 2004 Delegated examining II/3 Extent to which overall program meets agency needs, uses available options, and adheres to legal requirements and merit principles. Synthesis of data from surveys and oversight reviews. Employment Service/OMSOE 2005 * Strategic Goal/Objective number (counted within goal) . Use of Performance and Program Evaluation Results The OPM Executive Board, through our Strategic Initiatives Coordinator and the OPM GPRA working group, provides oversight and agencywide coordination of the evaluation program. The OPM Executive Board consists of the Director, Deputy Director, Associate Directors, Chief Financial Officer, Chief Information Officer, Director of Human Resources and EEO, and the President of AFGE Local 32. The GPRA working group consists of representatives from all OPM program offices and organizations. They will track and report on the goals and objectives, recommend necessary adjustments to them, and affirm or modify the measurements and resources being applied. Since FY 1999, our senior executive performance plans have been aligned with the strategic planning and measurement systems, and by FY 2001 all employees' performance plans will be so aligned. By widely sharing our Strategic and Annual Performance Plans, including posting them on our agency web page and on our employee intranet page, we have made sure that every employee and manager knows what our strategic goals and objectives are and how progress toward them will be measured on an agencywide basis, and on an individual basis for those which have already been aligned. We will report the results of the performance measurement and program evaluation activities to our stakeholders, including Congress, the Human Resources Management Council, Office of Management and Budget, General Accounting Office, Merit Systems Protection Board, and others, in the required annual performance reports and via special reports as necessary. The information will allow us to more effectively: formulate new and revised policy; improve the quality of products and services; update future strategic plans; prepare annual budgets; establish program-level work plans; assess individual and organizational performance; and ensure accountability and control. Use of Program Evaluation to Define Our Goals and Objectives Although our primary strategic direction for the future has not changed, the specific strategic goals and objectives in this updated strategic plan reflect information learned from a variety of internal and external evaluations, surveys, and reports. A list of studies used in updating this plan and in continuously evaluating our work is included in Appendix B. The issues raised and results contained in these reports confirm and support the direction we are taking to lead Federal human resources management well into the new century. These studies have identified the increasing desire of agencies to seek exemptions from portions of title 5, in part to deal with the shift toward a knowledge-based economy and new technology requirements for the workforce. Agencies need more flexible, yet consistent programs and policies in order to make the best use of their human resources in meeting their mission requirements. Our objectives listed under strategic goal I are designed to address these needs. However, as discussed more fully in the external factors section, it is also clear from the studies that the human resources workforce is significantly smaller, and that more line managers are fully involved in HRM. Delegation and deregulation mean there is a greater need for HRM accountability and an expanded oversight program (see our objectives under strategic goal II). Advances in technology and the increased HRM role of line managers both lead to our focus on providing human resources services and modernizing governmentwide data systems (see our objectives under strategic goal III). Finally, required audits of our trust funds and other financial management systems prompt the objectives established in strategic goal IV. . APPENDIX A: A CLOSER LOOK AT OPM Our Recent Past Over the past six years we have crystallized our mission, completed a major redesign of our functions, and privatized two major programs: training and investigations. We have strengthened our oversight role as the custodian of the merit system and have successfully transformed a major part of employment information and staffing services to a reimbursable basis. We have steadily improved customer service in employee earned benefit programs through investment in technology. These steps, along with more than commensurate reductions in administrative services, have allowed us to succeed with greatly reduced resources and to transform service delivery to our customers. We centralized our administrative functions to make better use of technology and automation and eliminated all of our regional headquarters, while preserving nationwide service delivery. We have reduced our FTE level from the FY 1993 baseline of 6,208 when we began our downsizing effort to 2,984 in FY 1999, a cumulative reduction of 3,224 FTE. This 52% decrease is a far greater reduction than that of any other Federal agency. Our Current Role The people at OPM provide leadership to strengthen human resources management (HRM) throughout the Government. Even though laws and delegations give substantial authority to the heads of departments and agencies, OPM serves as the President's agent and advisor for HRM issues that apply across the Federal Government. We ensure that the Government's corporate HR policy is responsive and effective. We work collaboratively with agency senior leaders, line managers, and HRM staffs, as well as employee representatives, to identify and address top priority HRM issues, and to ensure that agencies are incorporating effective workforce planning and strategic rewards into their strategies for accomplishing their goals and objectives. We work with the Office of Management and Budget to incorporate governmentwide HR initiatives into the President's budget, and to ensure that agencies' strategic plans incorporate HR goals and objectives. We chair the Human Resources Management Council, which is composed of the HR directors of Executive agencies. Through the Council we resolve problems, share best practices, and establish high performance benchmarks so agencies will have the high quality and diverse workforce they need. help set human resources rules with agencies' involvement. Human resources laws usually require us to issue implementing regulations. Where there is legal flexibility, we strive for an approach that best helps agencies accomplish their missions, relying heavily on advice from those agencies. We want to make sure that our regulations and oversight activity ensure agency compliance with the law, but without unnecessary constraints on their managers. We act as a partner with the Office of Management and Budget in reviewing legislative proposals affecting human resources management and in proposing legislative and executive initiatives to the President after consulting with agencies and other stakeholders. We participate in litigation before courts and administrative adjudicatory bodies on significant issues of civil service law. protect the merit system and veterans' rights through oversight. We assess agencies' effectiveness in human resources management at the governmentwide, agency, and installation levels. We use the information we gather to support policy development and to ensuring compliance with both the merit principles and personnel laws and regulations. Data we gather enhances agency capability for self-evaluation and assists agencies in designing and operating personnel programs that effectively support mission accomplishment. We certify agency delegated examining units and evaluate their compliance. We also review personnel systems outside the competitive service to determine whether their adherence to merit principles warrants an agreement allowing the interchange of employees between these systems and the competitive service without further examination. Veterans' rights are an integral part of the merit-based personnel system that we oversee and protect. help agencies recruit instantly and nationwide. On behalf of all agencies, we administer a governmentwide, computerized listing of all job vacancies in the competitive service currently open to outside applicants, plus many vacancies that are outside the competitive service. This listing allows agencies to quickly reach a wide range of potential employees and provides for open competition from all segments of society. Job seekers find it easy to learn about job openings 24 hours a day, 7 days a week, through the Internet, touch-screen kiosks in agencies, colleges and universities, and by touch-tone telephone. They may also complete on-line resumes and apply electronically for Federal jobs. Other enhancements are underway, that will allow job-seekers to complete a job interest profile and then be notified by email of jobs that match their interests. support agencies in merit-based candidate assessment and hiring. Roughly three-fourths of the 1.8 million non-Postal civil servants are in the competitive service, which means their selection is guided by merit principles, laws, and professional standards which we administer. The purpose is to ensure the validity and objectivity of selection criteria, to ensure that all receive equal opportunity, and to grant selection preference to certain veterans based on their service. Our examining experts continue to develop a wide range of assessment instruments for agencies' use. We provide examining policy advice and assistance, as well as direct reimbursable services to agencies for recruitment, candidate evaluation, and application processing. support agencies in workforce restructuring. The Federal Government is in a period of profound change, driven by the forces of improved management, reduced budgets, and changes in the skills needed to do the Government's work. Agencies are responding through workforce restructuring, involving often significant organizational redesign and staff reductions. We work closely with agencies to ensure they can effectively restructure while maintaining needed skills, quality, and diversity in the workforce. Our expert staff set policy consistent with law and administer the Federal programs for reductions in force, separation incentives and early retirement, and transition assistance for displaced employees. We also provide customized reimbursable services in these areas. ensure the suitability of Federal employees and provide for personnel investigations. We set and communicate governmentwide investigations policy for the Federal personnel security program, ensure the suitability of Federal employees, and carry out on-site inspections to make sure agencies are following established policies. We also provide, on a reimbursable basis through a contractor, personnel investigations relating to suitability and security. promote executive leadership for a results-oriented Government. Without exceptional leaders who can lead and motivate people, build coalitions and partnerships, and deliver quality services, the Government would not be able to serve the American people effectively. We provide leadership and services to help agencies select, develop, and manage strong, results-oriented executives who have a broad corporate perspective and a commitment to public service. Our services include administering executive and management development programs through three interagency residential training centers: the Federal Executive Institute in Charlottesville, VA, and the Management Development Centers in Shepherdstown, WV, and Denver, CO. provide governmentwide human resources development leadership. We administer the Government Employees Training Act and are responsible for promoting effective agency training programs. Because the Federal workforce has become predominately knowledge based, strategic agency investments in education and training are critical to mission accomplishment. We are promoting learning as a performance improvement tool; exploring innovative technologies for training delivery; considering new approaches to support learning, such as individual learning accounts; and supporting and collaborating with interagency groups to make effective use of learning technology and other methods to enhance workforce skills. We also provide assistance to Federal agencies through a multi-million dollar contract-based Training and Management Assistance program designed to improve human resources management. operate the Nation's largest retirement programs. We administer the Civil Service Retirement System and the Federal Employees' Retirement System, which together cover more than 5 million active and retired Federal employees from all agencies and disburse more than $40 billion each year in earned retirement benefits. manage employee health and life insurance programs. We set the standards for, contract with, and oversee the performance of benefit providers under the Federal Employees' Group Life Insurance and the Federal Employees Health Benefits programs. These highly regarded programs serve more than 10 million customers (active Federal employees, retirees, and covered family members) in all agencies. administer the systems for setting Federal compensation and benefits. In setting compensation and benefits, the Government does what most other large employers do to implement the traditional financial components of a broad array of strategic rewards, which also comprise non-financial rewards such as a family-friendly work environment and opportunities for continuous learning and skill development. To establish employees' basic pay, agencies look at the duties of their jobs to determine the right occupations and levels (job classification). We do the research and set the standards for classifying jobs and participate with others in establishing pay schedules for a variety of pay systems by referencing what non-Federal employers provide for comparable work. These pay schedules are adjusted periodically to account for local labor market changes and to address recruitment and retention problems. We also implement the pay administration provisions in title 5 under which an employee's pay is adjusted over time, based in part on performance, or augmented to provided premiums for working in unusual conditions. Similarly, to recruit and retain the optimum workforce, we develop and enhance earned employee benefits packages, including leave, insurance, and retirement. Such enhancements include implementing U.S. Tax Code provisions that allow employees to pay premiums with pre-tax dollars and introducing long-term care insurance at advantageous group rates. Through such actions, we not only seek to make these packages competitive with non-Federal sector benefits, but also serve as national models for other employers. provide tools for effective employee performance management. We have a leadership role in promoting effective performance management and ensuring that individual accountability is established and maintained throughout the Federal workforce. We set guidelines for evaluating, developing, and rewarding employee performance that leave agencies free to design and use appraisal, training, and awards approaches that suit them best. We also provide models and technical assistance for planning, measuring, developing, and rewarding performance at the individual, group, and organizational levels, including the development and implementation of balanced measures of results. In addition, we provide agencies and managers with guidance and assistance about how to identify and correct performance problems in accordance with requirements to assure that employees are treated fairly. take the lead in Government labor and employee relations. We are an advisor and consultant to agency officials in developing effective labor-management relations and employee relations practices that contribute to mission accomplishment. We are the single clearinghouse for governmentwide information on best practices, innovations, data trends, and other information in these areas. We help agencies work effectively with Federal labor organizations that represent 1.1 million Federal employees. We consult with labor organizations and agency managers and labor-relations officials on governmentwide rules, regulations, and directives affecting conditions of employment. In cooperation with the National Partnership Council, we champion collaborative labor-management relationships that promote improved performance, results, and service to the public. In addition, we provide leadership for agency employee relations activities that cover employee discipline, employee assistance, employee health, and workplace violence prevention programs. enhance the ability of Federal employees to balance work and family responsibilities. We maintain the Family-Friendly Workplace Advocacy Office, which is designed to serve as the central point in the Federal Government for employees and agency staff to contact for information regarding family-friendly initiatives, laws, and regulations. This office supports and promotes many initiatives, including childcare, eldercare, and telecommuting. enhance and administer the Federal Government's family-friendly leave programs. We take a leadership role in developing and administering the governmentwide family-friendly leave programs (i.e., family and medical leave; sick leave for family care, bereavement and adoption purposes; annual leave for personal needs; and the leave transfer and leave bank programs). The family-friendly leave programs are a model to all employers and demonstrate the Federal Government's recognition of the importance of family responsibilities and commitment to assisting Federal employees in balancing their work and family responsibilities. We are recognized as an innovator in developing and administering leave programs that foster goodwill and create a more compassionate workplace, resulting in a more productive workforce. advance governmentwide automation of human resources management systems. We have a crucial interest in ensuring that agencies are able to make the best and most cost-effective use of automation to achieve human resources management objectives. To this end, we lead the interagency Human Resources Technology Council, which is responsible for crafting a long-term strategic vision and goals for using information technology in human resources management governmentwide. The Council promotes cooperatively developed systems and operations to solve common problems and prevent costly duplication of efforts, as advocated by the Clinger-Cohen Act of 1996. manage a comprehensive workforce information system. We set the standards for information that goes into employees' Official Personnel Folders at agencies, we retain ownership of those records, and we provide instructions for release of personnel data under the Freedom of Information Act and the Privacy Act. We also collect and electronically maintain employee data in a Central Personnel Data File to support and improve Federal personnel management decisions. In addition, we are required by law to gather, analyze, and maintain statistical data on the diversity of the Federal workforce, and to prepare evaluation reports to Congress. seek improvement through innovative human resources management projects. We work with other Federal agencies on demonstration projects and alternative personnel systems to explore better and simpler ways to manage Federal personnel. We also conduct studies and learn from the research of others. OUR LEGAL AUTHORITY The President has authority, provided by the Constitution and by specific laws, to oversee the human resources management functions of the Executive branch and of agencies outside the Executive branch that employ persons in the competitive service. By law (5 U.S.C. 1104), "the President may delegate, in whole or in part, authority for personnel management functions, including authority for competitive examinations, to the Director of the Office of Personnel Management." That law also provides that the Director of OPM may delegate some or most of those functions to agencies and establish standards for their conduct. Other laws have given additional human resources management authority directly to the Director of OPM. The Civil Service Act of 1883 established the Civil Service Commission in response to scandals over giving Government jobs as rewards for political service. Even then, however, a major goal was to improve the quality of the Nation's civil service. Other countries had already established high quality benchmarks by hiring civil servants on the basis of merit, often determined by education or a written test. For nearly 100 years, the United States Civil Service Commission evolved in ways that strengthened its hand in improving the management of the Executive branch. The Civil Service Reform Act of 1978 continued that evolution by transferring human resources management responsibilities to a new Office of Personnel Management that was more directly accountable to the President. Executive Order 12107 of December 28, 1978, and Reorganization Plan No. 2 of 1978 (5 U.S.C. App.), effective January 1, 1979, implemented that change. Over the years, many other laws embraced developments in private sector human resources management practices and showed a continuing public interest in fairness and efficiency for the civil service. A partial listing of those laws gives some sense of the range of our responsibilities: Retirement Act (1920), Classification Acts (1923, 1949), Veterans' Preference Act (1944, including procedures for reductions in force and adverse actions, and establishing a "rule of 3" to limit hiring only to top candidates), Annual and Sick Leave Act (1951), Incentive Awards Act (1954), Group Life Insurance Act (1954), Government Employees Training Act (1958), Health Benefits Act (1959), Federal Salary Reform Act (1962), Civil Rights Act (1964), Federal Employee Pay Comparability Acts (1970, 1990), Intergovernmental Personnel Act (1971), Equal Employment Opportunity Act (1972), Social Security Reform Act (1983), Federal Employees Retirement System Act (1986), Whistle Blower Protection Act (1989), Federal Employees Family-Friendly Leave Act (1994), Uniformed Services Employment and Reemployment Rights Act (1994), Veterans Employment Opportunities Act (1998), Long Term Care Security Act (2000), and continuing provisions placed in annual appropriations acts. Presidents have also issued key Executive orders on human resources matters, such as those broadening the scope of the competitive service and establishing human resources offices in departments and agencies (E.O. 7916, 1938); establishing the personnel security program (E.O. 10450, 1953); permitting collective bargaining (E.O. 10988, 1962); defining responsibilities for employee training (E.O. 11348, 1967); setting out rights and responsibilities in collective bargaining (E.O. 11491, 1969); establishing labor-management partnerships (E.O. 12871, 1993), and prohibiting discrimination based upon sexual orientation (E.O. 13160, 1999) and status as a parent (E.O. 13152, 2000). All of these laws and Executive orders explicitly support the activities described in our goals and objectives. In the aggregate, they give us responsibility to serve the public by providing human resources management leadership and high quality services based on merit principles, in collaboration and partnership with Federal agencies and employees and their representatives. At the core of Federal human resources law are these merit system principles, found in 5 U.S.C. 2301(b): (1) Recruitment should be from qualified individuals from appropriate sources in an endeavor to achieve a work force from all segments of society, and selection and advancement should be determined solely on the basis of relative ability, knowledge, and skills, after fair and open competition which assures that all receive equal opportunity. (2) All employees and applicants for employment should receive fair and equitable treatment in all aspects of personnel management without regard to political affiliation, race, color, religion, national origin, sex, marital status, age, or handicapping condition, and with proper regard for their privacy and constitutional rights. (3) Equal pay should be provided for work of equal value, with appropriate consideration of both national and local rates paid by employers in the private sector, and appropriate incentives and recognition should be provided for excellence in performance. (4) All employees should maintain high standards of integrity, conduct and concern for the public interest. (5) The Federal work force should be used efficiently and effectively. (6) Employees should be retained on the basis of the adequacy of their performance, inadequate performance should be corrected, and employees should be separated who cannot or will not improve their performance to meet required standards. (7) Employees should be provided effective education and training in cases in which such education and training would result in better organizational and individual performance. (8) Employees should be (A) protected against arbitrary action, personal favoritism, or coercion for partisan political purposes, and (B) prohibited from using their official authority or influence for the purpose of interfering with or affecting the result of an election or a nomination for election. (9) Employees should be protected against reprisal for the lawful disclosure of information which the employees reasonably believe evidences (A) a violation of any law, rule, or regulation, or (B) mismanagement, a gross waste of funds, an abuse of authority, or a substantial and specific danger to public health or safety. . APPENDIX B: PERTINENT EVALUATION STUDIES Merit Systems Protection Board (MSPB) "Restoring Merit to Federal Hiring: Why Two Special Hiring Programs Should be Ended" (January, 2000) "The Role of Delegated Examining Units: Hiring New Employees in a Decentralized Civil Service" (August 1999) "Federal Supervisors and Poor Performers," the second in a series which looks at human resources issues in the Federal Government (July 1999) Office of Policy and Evaluation "Customer Survey" (June 1999) "Civil Service Evaluation: The Evolving Role of the U.S. Office of Personnel Management" (July 1998) "Federal Supervisors and Strategic Human Resources Management" (June 1998) "The Changing Federal Workplace: Employee Perspectives" (March 1998) "Adherence to the Merit Principles in the Workplace: Federal Employees' Views" (September 1997) "Achieving a Representative Federal Workforce: Addressing the Barriers to Hispanic Participation" (September 1997) "Fair and Equitable Treatment: A Progress Report on Minority Employment in the Federal Government" (August 1996) "The Rule of Three in Federal Hiring: Boon or Bane?" (December 1995) "Sexual Harassment in the Federal Workplace: Trends, Progress, Continuing Challenges" (November 1995) "Removing Poor Performers in the Federal Service: An Issue Paper" (September 1995) "Leadership for Change: Human Resource Development in the Federal Government" (July 1995) "Temporary Federal Employment: In Search of Flexibility and Fairness" (September 1994) "Working for America: An Update" (July 1994) OPM Inspector General Office of the Inspector General Semiannual Reports to Congress as Required by the Inspector General Act Financial Statements Audits as Required by the Chief Financial Officers Act Audit of Agency Compliance with the Federal Managers Financial Integrity Act Audits of OPM Internal Program Offices, the Federal Employees Health Benefits Program and Pre- and Post-Award Contracts Office of Merit Systems Oversight and Effectiveness (OMSOE/OPM) "The 3Rs: Lessons Learned from Recruitment, Relocation, and Retention Incentives" (December 1999) "The HR Workforce Crisis: Meeting the Challenge of Change: An Occupation in Transition Part III" (December 1999) "Strategic Human Resources Management: Aligning with the Mission" (September 1999) "Looking to the Future: Human Resources Competencies: An Occupation in Transition Part II" (July 1999) "Federal Human Resources Employment Trends: An Occupation in Transition Part I" (May 1999) "Opportunity Lost: Openness in the Employment Process" (April 1999) "Poor Performers in Government: A Quest for the True Story" (January 1999) "Human Resources Management Accountability System Development Guide" (December 1998) "Human Resources Management Policies and Practices in Title 5-Exempt Organizations" (August 1998) "Incentive Awards Study" (August 1998) "Downsizing in the Federal Government" (August 1998) "Deregulation and Delegation of Human Resources Management in the Federal Government" (July 1998) DOD S&T Reinvention Laboratory Demonstration Program - Status Report (June 1998) USDA Demonstration Project Program - Summative Evaluation Report (May 1998) "Appropriateness of Non-Technical Training" (January 1998) "Workers Compensation - Administration Laboratory Site Study" (January 1998) National Institute of Standards and Technology Demo Project - Summative Report 1988 - 1995 (June 1997) "Human Resources Management Accountability in Federal Agencies: Current Efforts and Future Directions" (January 1997) National Academy of Public Administration (NAPA) "New Options, New Talent: The Government Guide to the Flexible Workforce" (August 1998) "Alternative Service Delivery: A Viable Strategy for Federal Government Human Resources Management" (November 1997) "New Times, New Competencies, New Professionals - a Guide for Implementing a Competency Model for HR Professionals: A Strategy for Becoming a High Performance Organization" (October 1997) "Managing Succession and Developing Leadership: Growing the Next Generation of Public Service Leaders" (August 1997) "Practical Applications for Federal Agencies" (November 1996) "Investment in Productivity: Successful Human Resources Development Practices" (October 1996) "A Guide for Effective Strategic Management of Human Resources" (June 1996) "Improving the Efficiency and Effectiveness of Human Resources Services" (June 1996) "A Competency Model for Human Resources Professionals" (June 1996) General Accounting Office (GAO) "Results Act: Observations on the Office of Personnel Management's Fiscal Year 2000 Annual Performance Plan" (July 30, 1999) "Small Business Administration: Review of Selected Personnel Practices" (April 23, 1999) "Year 2000 Computing Challenge: OPM Has Made Progress on Business Continuity Planning" (May 24, 1999)