The Business of Government Hour


About the show

The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. The executives discuss their careers and the management challenges facing their organizations. Past government executives include Administrators, Chief Financial Officers, Chief Information Officers, Chief Operating Officers, Commissioners, Controllers, Directors, and Undersecretaries.

The interviews

Join the IBM Center for a weekly conversation about management with a government executive who is changing the way government does business.

Dan Blair interview

Friday, March 14th, 2003 - 20:00
Mr. Blair serves as the first Chairman of the independent Postal Regulatory Commission, the successor agency to the former Postal Rate Commission.
Radio show date: 
Sat, 03/15/2003
Intro text: 
Missions and Programs...

Missions and Programs

Complete transcript: 

Arlington, Virginia

Wednesday, March 5, 2003

Mr. Lawrence: Good morning, and welcome to The Business of Government Hour. I'm Paul Lawrence, the co-chair of The IBM Endowment for The Business of Government. We created The Endowment in 1998 to encourage discussion and research into new approaches to improving government effectiveness. Find out more about The Endowment by visiting us on the web at

The Business of Government Hour features a conversation about management with a government executive who is changing the way government does business. Our conversation this morning is with Dan Gregory Blair. Dan is the deputy director of the Office of Personnel Management. Good morning, Dan.

Mr. Blair: Good morning, Paul. How are you?

Mr. Lawrence: Great. Thanks for joining us.

Mr. Blair: Thank you for the invitation.

Mr. Lawrence: Also this morning is Nicole Gardner. Good morning, Nicole.

Ms. Gardner: Good morning, Paul. Good morning, Dan.

Mr. Blair: Hello, Nicole.

Mr. Lawrence: Dan, perhaps you could start by talking to us about OPM. Give us a sense of its mission and the activities.

Mr. Blair: The Office of Personnel Management or OPM serves as the principal adviser to the President on federal personnel issues. We're an agency of approximately 3,600 employees strong. Our work force includes employees who possess a broad swath of specialties including people with expertise in budget, finance, security administration, personnel management, computer security, telecommunications.

Our mission is to build a high-quality and diverse federal work force based on merit system principles, that America needs to guarantee its freedom, prosperity, and ensure the security of our nation. Our goals are threefold: first, we want federal agencies to adopt human resources management systems that improve their ability to build successful, high-performing organizations. We work to see that federal agencies use effective merit-based human capital strategies to create a rewarding work environment that accomplishes those missions.

And we meet the needs of the federal agencies' employees and delivery of efficient and effective products and services such as our retirement system, our life and health insurance systems, and long-term care programs as well.

Mr. Lawrence: I'm surprised when you told us about the number of employees and the wide range of skills. I would have thought intuitively these are all HR-focused folks.

Mr. Blair: In operating an agency, you need to have a wide variety of skills. We have a CFO, we need people with top financial management skills, we need people with top tech skills. I think we'll go into this later in the discussion, but OPM is the lead agency on five of the e-government initiatives that span across government. So we need people with top IT skills. So we need people with the breadth and depth in a wide variety of skills, knowledge, and abilities.

Ms. Gardner: Dan, you've give us the broad context. Can you tell us a little bit about what you do specifically as the deputy director?

Mr. Blair: If you look at Title V, which is the basis for our authority at the Office of Personnel Management, it says that the deputy director's functions are those that the director may from time to time assign him or her. That's pretty broad, and I will say that this director, Kay Coles James, has given me quite a full plate. I serve on the President's Council on Integrity and Efficiency which is the Inspectors General Council ferreting out waste, fraud, and abuse across government. I assist the director on any projects that she may deem necessary.

For instance, I was the lead on implementing our recent restructuring. Effective March 3rd, we have a restructured OPM, which is intended to better deliver our goods and services and serve our customers better. One of the first tasks that the director assigned me when I came to OPM was to fix the hiring process, and we've been working hard on that.

I am the chief point of contact to the veteran's community, because, as you know, the federal government serves as the largest employer of veterans in the country. I help oversee the Combined Federal Campaign. Also I will from time to time testify on Capitol Hill on various issues. For instance, last year I testified before the House Postal Appropriations Subcommittee. In addition, I testified before one of the government reform subcommittees last December on our federal employee health benefits program. So as you can see, I have a broad plate of responsibilities.

Ms. Gardner: Kay Coles James is a very dynamic personality. She has a very broad and very aggressive vision for the federal work force. I'm sure that it's an exciting position, and it's got obviously a lot of diversity to it.

You've had a very interesting career with lots of different positions and turns. Can you tell people a little bit about how you got to where you are?

Mr. Blair: It's been a long, interesting story. I started in Washington out of law school. I'm a graduate of the University of Missouri, School of Law, in Columbia, Missouri, and I came to work for my local congressman from Missouri. I was a staffer on the former House Post Office and Civil Service Committee. That was the House of Representatives' committee charged with oversight jurisdiction of the Civil Service and the Postal Service. What I thought was a short-term assignment turned into about a 10-year assignment, and I served there as the chief Republican counsel.

After the 1994 elections, that committee and several other committees were combined to form the House Government Reform and Oversight, and I worked there for three years as a subcommittee staff director on the subcommittee charged with oversight of the Postal Service.

Beginning in January 1998, I moved over to the other body as they call it on Capitol Hill, from the House side anyway, I moved over to the Senate working for former Senator Fred Thompson as senior counsel on the Senate Governmental Affairs Committee. My portfolio included oversight of the Civil Service, government ethics, federal budget process reform, and the Postal Service.

So I've seen it from one angle for almost 17 years, and then I was tapped by the President to be the deputy director and work for Kay Coles James at the Office of Personnel Management. It's a phenomenal opportunity.

Mr. Lawrence: When you think about your career, is there any one experience or set of experiences that best prepared you for this position?

Mr. Blair: I don't think there would be one thing to best prepare you. I came to OPM having seen it for years in operation, but never internally. I saw it strengths, and I also saw its weaknesses. So I was prepared for the agency when I came down there. That said, I've been very impressed with the caliber of employees that we have, their dedication to hard work, and their ability to really turn on a dime in carrying out a wide variety of tasks at a moment's notice.

We have a tough job right now. We're engaged in a war against terrorism, and our public servants are asked to operate in a stressful environment, and people recognize that. That said, I think that we have a tremendous federal work force, and I'm very honored to be part of it and to be serving in this administration.

Mr. Lawrence: What drew you to HR? You were a lawyer, you come to Washington, and you end up in HR.

Mr. Blair: HR is people oriented. The emphasis is funny here now - funny in the sense that for most of the past couple of decades, the emphasis of congressional oversight has not been on Civil Service reform so much as it has been on the budgetary aspects. I was part of the staff effort that drew up the new Federal Employee Retirement System in the mid-1980s. We looked at the Federal Employee Health Benefit System and saw how that needed reform, and the Long-Term Care system.

But beginning in the mid- to late-1990s, we saw that a huge number of program failure across government that were occurring could always be traced back to not having the right people in the right place with the right skills. When David Walker was confirmed as the comptroller general of GAO, he brought a new level of enthusiasm and commitment to this issue area. I worked on a number of reports that Senate Governmental Affairs put out under Senator Thompson's name in which we highlighted program failures, but we also highlighted the fact that the downsizing that occurred in the 1990s while reducing the size of government, often ended up with agencies being anorexic in terms that they lost people with needed skills, knowledge, and abilities, and weren't able to really carry out their functions.

So we have a new shift in emphasis right now, and the shift is on viewing people not has a burden or not as just a cost, but viewing them as a resource. Then with the confirmation of Kay James as OPM director, she's breathed new life into the concept of HR or human capital, and it's been a tremendous change in the way of thinking, that people are indeed our best asset in the federal government, and she's been leading that charge and at the forefront of that fight of getting people to recognize throughout government and outside the government that, indeed, federal employees are up to the challenge.

Mr. Lawrence: I'd be curious in your perspective. You grew up in the House and the Senate on the Legislative side, and now you're in the Executive Branch working on the same issues. Could you compare or contrast, the differences, similarities, management styles, approaches to issues?

Mr. Blair: I think in the House and Senate you have a great amount of autonomy for each individual office. Now I'm working in to me what is a large organization, 3,500 people, but if you compare it to the new Department of Homeland Security of 170,000, we're still small. So that was a cultural change for me.

That said, the two bodies of government operate with distinct missions and with distinct styles and differences. Congress's duties are to pass laws. The Executive Branch carries those out. It was interesting, I helped secure the passage of the Long-Term Care legislation, and then I was on the other end helping to carry it out. So you can see you get an interesting perspective of being able to see from the inside what those on the outside don't see, and you sit back and go if I'd only known that when I sat in this other position.

That said, I think it gives you a well-roundedness that not everyone has that opportunity to have, and it's been a phenomenal experience this last year and a half.

Mr. Lawrence: That's a good stopping point. Rejoin us in a few minutes as we continue our conversation with Dan Gregory Blair of OPM. What are the management challenges of standing up a new department? We'll ask Dan to tell us how OPM is working with the Department of Homeland Security when The Business of Government Hour returns.


Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Dan Gregory Blair. Dan is the deputy director of the Office of Personnel Management. Joining us in our conversation is Nicole Gardner.

Ms. Gardner: Thank you, Paul. Dan, we've had some conversation about some of the broad mandates of OPM. One of the things that's on everybody's minds these days if the standing up of the Department of Homeland Security. No matter what part of government or the public you're in, it's a big question.

I know that OPM is engaged in this activity. Can you tell us a little bit about the role of OPM in setting up the new department, and what some of the time lines are for those activities?

Mr. Blair: When you said it's on your mind, believe me, it's on our minds as well. That is probably the number-one priority right now, is assisting the department in standing up.

OPM has played a pivotal role since the development of the DHS proposal. We played a key role in the legislative debate, and we were successful in obtaining the critical authority to develop the new HR system in six essential areas for the new department: hiring, compensation, performance management, firing appeals, and labor/management relations.

We played a very active role in the transition in making sure the department hit the ground running when it official on January 24th, and we're now gearing up to work closely with the department's officials, union leadership, rank-and-file employees, and other interested stakeholders, in the actual development of the new HR systems.

Following this extensive outreach, which will take place over the spring and summer, the outreach is designed to be as collaborative and inclusive as possible, and I can't emphasize that enough. We hope to see the actual implementation of the new HR systems shortly after the new calendar year.

Ms. Gardner: That's aggressive.

Mr. Blair: It is very aggressive. It certainly is taxing us, but we're up to the challenge. We have to be, given the environment in which we're operating right now.

Ms. Gardner: That's reassuring to hear as a citizen. I know there are a lot of people involved, a lot of departments, a lot of different parties and perspectives. Can you give us a little peak in terms of the challenges you're facing coordinating all these different players?

Mr. Blair: This challenge cannot be overestimated. There are 22 major entities that are being brought within the confines of this new department, I've been told over 108 subcomponents, thereof, with 170,000 employees. It is essential that this coordination and integration be done well and in a timely manner. So we're going to be working closely with the department to address the multitude of disparities in HR programs that currently exist among and between all those entities, and that we want to continue to provide the department whatever advice and assistance we can in any area associated with the communication and management of its work force.

We're going to be playing a role with this department for a long time to come.

Ms. Gardner: Yes, and I'm sure they appreciate the help, and it's going to be very complex as they get rolling. The Act actually exempted the civil servants in the new department from a lot of the laws that apply to hiring, to promotions, to job descriptions, to bargaining, appraisals, firing, disciplining, and so on. I think there's a lot of misunderstanding about what the impact of all of those changes is. Can you help us understand a little bit more about how these changes will affect civil servants not only in Homeland Security, but what else it might mean for other civil servants?

Mr. Blair: As I said earlier, the Act gave flexibility in six different areas, hiring, compensation, performance management, firing appeals, and labor/management relations. Until official changes are made and implemented, the employees of the department will continue to be covered by the procedures that currently exist. So the flexibilities are there only if they're exercised.

In the legislation creating the department - it's a nuance, but it's a nuance that needs to be understood - did not exempt the 170,000 employees from the Civil Service laws. Rather, it gave the flexibility to implement changes in these limited areas. That said, the changes that will ultimately come as a result of the authorities granted will have no direct or immediate impact on the rest of the Civil Service.

However, it will be a starting point for managerial flexibility, and if best practices are identified, if good practices that are working well in this department appear to transfer well to others, I think that you will see legislation accordingly. But it will be up to the administration and Congress to determine if they are going to be made applicable to the other parts of the federal government. Right now we're focusing on the Department of Homeland Security, and we want to make sure that we get these systems up and running, and running well in order to defend our homeland.

Ms. Gardner: Pursuing the Act for just another minute here, there were a lot of interesting things in that bill, and one of the things that was very interesting was the creation of a new job, if you will, in the federal government called the chief human capital officer. Tell us a little bit about what that means and what OPM expects from that new team of people.

Mr. Blair: As I said earlier, at OPM and under this director, Kay James, we see people as an asset, an asset to be managed well. In recognition of the director's vision, we obtained through this legislation, particularly with the support of Senators Thompson and Voinovich, mandate to create what's called a Chief Human Capital Officer's Council. Each of the 24 major agencies and departments will be asked to name a chief human capital officer.

We have a CFO Council, which is devoted to good financial practices, and we have a chief financial officer at each of these agencies. We have a chief information officer, and a CIO Council that will oversee IT issues at each of these agencies. This is a recognition of the elevation of human resource, or if you want to call it human capital, we use them almost interchangeably, issues, in the world around us today, that in order to effectively manage your organization, you not only need to effectively manage your money and your information technology, but you need to be able to manage your people well, too, and naming a chief human capital officer is recognition of that.

Mr. Lawrence: President Bush also added the management of a $500 million fund called the Human Capital Fund. Could you tell us about the plans for this fund?

Mr. Blair: Sure. I'm happy to. This is exciting because this is an opportunity to use pay as a strategic tool in better managing our work force for more effective results. In the FY 2004 budget, President Bush proposed to allocate $500 million for the Human Capital Performance Fund. This is a fund that would be administered by OPM. Agencies will be required to submit to OPM a plan to distribute the money from the fund to employees based strictly on employee or organizational performance, and/or to address other critical agency human capital needs that affect an agency's performance.

So what we have here is a proposal to actually use pay, which is not a strategic tool yet for performance management. It's exciting, and it's the first step that we've taken towards reforming how we reward our employees.

Mr. Lawrence: OPM is also in charge of helping federal agencies meet the challenges of the President's Management Agenda in the area of strategic management of human capital. Could you talk to us about how OPM is measuring the success of these efforts?

Mr. Blair: Our role in this area is both evaluative and consultative, evaluative in that we we're working with OMB in learning about each agency and its human capital challenges and helping agencies develop plans and make commitments to move towards a more strategic management of their human resources.

We're also consultative in that same role, too, in helping them identify ways of improving their human capital management. As agencies move beyond making these plans and implementing these specific initiatives, our OPM team is working to develop relationships with senior agency leaders and engage them in efforts to better align their human capital with agency missions and guide them towards commitments that will actually produce results and help them better accomplish their goals.

During 2002, OPM, the Office of Management and Budget, and GAO, worked together to revise the human capital standards for success to provide a clearer set of outcomes for agencies to use in gauging their efforts. As the need for more guidance became evident, OPM developed what we call a human capital assessment and accountability framework to guide agencies toward achieving these standards.

So we have the human capital standards for success, and how to reach success on these standards, we have the framework. So we have good guidance and practices in place.

Ms. Gardner: So you're helping other agencies to figure out what they need to do to be successful, and as you pointed out in the beginning, OPM is also a very multidimensional agency in and of itself. So what's OPM doing to improve its management of its human capital?

Mr. Blair: If you look at the most recent scorecard that was issued by the President, OPM was one of eight agencies with all green progress scores, and we're in the top six for our status scores as well. So we're definitely among the top scoring agencies in government on the scorecard.

In that effort, we've also realigned and restructured ourselves to better serve our customers. What we've done is we've taken our organization and reworked it so we have four primary divisions devoted to the strategic HR policies. Our human capital scorecard component is our accountability in leadership division. Then we have HR products and services, and our management component. Along with the three offices of communication, congressional relations, and general counsel, we're there to help agencies and help ourselves internally carry out the President's agenda on human capital.

Mr. Lawrence: That's a good stopping point. It's time for a break. Come back in a few minutes as we continue talking about management with Dan Gregory Blair of OPM. This is The Business of Government Hour.


Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Dan Gregory Blair. Dan is the deputy director of the Office of Personnel Management. Joining us in our conversation is Nicole Gardner.

Ms. Gardner: Thanks, Paul. Now Dan, we've just talked about all the things that OPM is involved with, and we all know how important homeland security is. So in case anybody over there thought they were going to have a normal workday, we wanted to make sure we talked about some of the other things that are on your plate that Mr. Forman has had the confidence to send over to OPM.

There are five, actually six, you just corrected me earlier, government, e-government-wide initiatives, and we want to talk about each one of them. The first one, can we just start with the Recruitment One Stop? Tell us a little bit about that one.

Mr. Blair: Certainly. The way that I look at these e-government initiatives is that they cover the entire employee's life cycle while they're in the federal government. To start off with, we would look at Recruitment One Stop. What this will do is allow for job seekers to have access to a web-based application system. We will have a federal government-branded web presence that delivers a fast and responsive experience. It is intended to be clear and easy to use, and it will help job seekers identify jobs that match both their skills and interests. We intend for it to be an efficient process for building online job applications.

Early feedback regarding the eligibility screening on factors such as citizenship or age will be built in. The online application will have a status tracking component, all working towards a seamless integration with agency automated assessment systems.

As we've announced recently, we did award a major contract with in January 2003, and we hope to have some new enhancements on our website beginning in April 2003, such as a new search function, and it will have a new design look to it as well.

Mr. Lawrence: Another of the initiatives is the Enterprise Human Resource Integration. Could you tell us about its goals and status?

Mr. Blair: Enterprise Human Resource Integration, or EHRI for short, will eliminate the need for paper records on employees. This will enable the management of reporting of benefits generated by our e-payroll initiative, and the electronic transfer of employee information throughout the federal employee's life cycle. So instead of keeping paper records, on employees, we'll be able to do this electronically, and this will reduce redundancies, improve time, and definitely improve efficiencies.

At the end of the employee's life cycle when he or she goes into retirement, they will transfer the data to our retirement systems, and we're attempting to modernize that as well through another major initiative.

Ms. Gardner: So there is some logic here. You hire employees, you get all their data. Now comes the next one, which is the whole training side, the e-training side. Tell us a little bit about that one.

Mr. Blair: I don't know if you've had a chance to go look at our Go Learn website, but I'm fascinated with it. If you click onto it you'll see that it appears to be an office, and you can drill down into the offices or go above or below and looking at what classes might be best for you.

This supports the career development of the federal work force. A number of benefits accrue to online training. It reduces repetition, you have economies of scale. It's an easy one-stop, web-based access for employees to access. It also encourages additional training and investments in learning as appropriate to the continuous development of your human resources.

The e-training initiatives connects federal agencies to a competency-based library of courses throughout the creation of what we call a portal. Once you enter the portal, then you can access the different courses. The Go Learn website went operational in July 2002, and in January 2003, both the Federal Law Enforcement Training Center and the Federal Executive Institute have operational sites as well on that website.

The site is one of the most active sites of its type in the world, and we've had over 40,000 users to register on the site since July when we opened. So we've had great success with that, and we look forward to more.

Mr. Lawrence: What e-payroll and e-clearance?

Mr. Blair: E-payroll is an effort to consolidate the 22 disparate payroll systems that you have in the federal government. We've gone through an extensive process, and we've narrowed that down to two processing centers. What we're doing here is an attempt to improve economies of sale, gain efficiencies, and save the taxpayers more than $1 billion by consolidating it down to two centers.

Right now, there will be an improved financial management, we'll have an improved link between performance and budget and, again, greater efficiencies in federal payroll processing. This has been a tremendous effort, and we're looking forward to saving the taxpayers over $1 billion.

Mr. Lawrence: So you've got the employees, you've trained them up, you've gotten them cleared, and now they're going to retire. Tell us about the modernization program of the retirement system.

Mr. Blair: This has been an ongoing effort, but we want to make sure that there's a seamless and paperless trail, which can follow an employee into retirement. Once in retirement, if a retiree needs to retrieve these records, that he or she will be able to do so. So this is all part of an effort to keep the entire employee's life cycle in electronic format, rather than going into a cave in Boyers, Pennsylvania, and having to retrieve records that may date back 20, 30, or even 40 years, that you'll be able to access them almost instantaneously.

Another part of this whole e-government initiative, also a very important one, is the e-clearance initiative in which we'll be able to do security clearances on line as well. This is one area that is often time consuming, and our intention is to improve the speed and the processing of individual security clearances.

Mr. Lawrence: All these e-government initiatives would seem to involve coordination and collaboration of the HR functions in the different agencies. How is OPM working with the other agencies to facilitate these accomplishments?

Mr. Blair: We are the managing partner on these initiatives, so we've been charged with taking the lead on this. That said, other agencies are our working partners, and we've been looking at them for support and guidance as well. These have been going very well, and we look forward to continuing them.

Ms. Gardner: Dan, it seems like a focal point of many of these initiatives, obviously in the e-government world, there is a focus on technology and what technology does to enable the ability for OPM to streamline all these processes. How is technology going to increase the effectiveness of OPM as the provider of these services to both other agencies and to the civil servants?

Mr. Blair: Let's go through an employee's life cycle, and I think we can hit it along those lines. Recruitment One Stop will benefit agencies form a faster recruitment, selection, and hiring process of getting the right people with the right jobs with the right skills. The e-training initiative will deliver effective and cost-effective training when needed in a format that's most appropriate for the agency's missions. Improved access to background investigations and clearance information will be facilitated by our e-clearance committee, and it will put key personnel in these security sensitive positions faster than ever before possible.

The EHRI process will facilitate the management of agency personnel and permit a more efficient exchange of personnel and payroll data among agencies. Now we won't have to wait to transfer paper if an employee moves between different agencies; that can be done electronically.

Then the e-payroll initiative will provide guidance on structuring payroll for agencies. So you have almost a seamless process here for an employee's life cycle from the time that they're hired, to the time that they enter into retirement.

Mr. Lawrence: I'm curious in terms of your experiences what the lessons learned would be. You talked about the success of each one these and the fact that as a managing partner you know that things are going quite well. As you reflect on this and perhaps give advice to others working these cross-agency collaborations, what are the lessons learned?

Mr. Blair: I think the lessons learned are that you always have to look at these issues from the other person's perspective in order to know where they're coming from in order that you can effectively lead them. It's a collaborative process. It's not one to be dictated by one agency to another. That said, you certainly have to take up the mantle of leadership and go where the President expects you go to, and carry it out as effectively as possible.

This is evidence of OPM's new role, and evidence of the director's commitment at raising the visibility of OPM to really a position of which it was envisioned to be in the 1978 Civil Service Reform Act of being the chief personnel adviser to the President on federal personnel issues.

Over the past decade, as you know, OPM saw itself downsized significantly. We've seen a number of agencies seeking additional flexibilities outside the scope of Title V of the United States Code, which we administer. That said, we have a new role at OPM. We're more about tools than we are about rules. That said, we are holding agencies accountable for the strategic management of their most important capital, their people.

We have a director who is committed to building and establishing a world-class organization that not only employs within OPM, but federal employees outside the federal government will look to as the cutting edge for best practices in human resources management.

Mr. Lawrence: That's a good stopping point. Rejoin us in a few minutes as we continue discussing management with Dan Gregory Blair of OPM. What are the largest human resource challenges facing the federal government? We'll ask Dan for his perspective when The Business of Government Hour returns.


Mr. Lawrence: Welcome back to The Business of Government Hour. I'm Paul Lawrence, and this morning's conversation is with Dan Gregory Blair. Dan is the deputy director of the Office of Personnel Management. Joining us in our conversation is Nicole Gardner.

Ms. Gardner: Thanks, Paul. Dan, we've had a very interesting conversation, and we've talked about a lot of the initiatives. Let's turn our attention just a little bit now and talk about some of the challenges that are facing the government today in the world of human capital and HR. What are they, and how are they being addressed?

Mr. Blair: As you know, and it's been highlighted quite a bit, we face a retirement wave, that a significant number of federal employees will be eligible for retirement over the course of the next 5 years. If you give early-outs as regular retirement, over half the work force or up to half the work force. In our executive ranks, it goes up to 70 percent.

That said, I think the most significant challenge we're facing is making sure the agency and department heads know that human resources issues, human capital issues, are no longer just HR, the human resource department's, purview. Rather, it's a management and leadership issue.

To emphasize that and to drill that down, of the five strategic cross-cutting initiatives on the President's Management Agenda, the strategic management of human capital is the first one. It's the first one because you can't achieve success on the other four without effectively having the right people with the right skills and right knowledge in place getting the right jobs done. It's that important.

Since it's that important, agency leadership has taken notice, we're holding agencies and departments accountable, that's why you have a scorecard, and we will continue to hold them accountable for the ways that they manage their work force.

Mr. Lawrence: You mentioned the retirement wave and the impact on federal agencies. Let me make this personal, what kind of challenges does this present OPM?

Mr. Blair: At OPM we're engaged in work force planning, and we know where our people may or may not be leaving. That said, it's also an opportunity, and one of the things that Director James has stressed is that when we talk about a human capital crisis, the flip side of that is a human capital opportunity about bringing new people in government, and bringing fresh faces and new ideas. That said, you're going to have to have systems in place that can rapidly replace those people who might be leaving.

We've heard about a retirement wave, and our information shows that not quite as many people retired the past year as had been predicted. I think that's primarily because of the economy. But in the next hot economy, we may be having more people retire than we had anticipated. So that's why we really need to have systems in place, effective hiring systems in place, that can bring people on board quickly with the right skills in order to accomplish agency missions and goals.

Ms. Gardner: Dan, under the banner of challenges, continuing along this theme, you mentioned in the very beginning segment about the fact that you've been asked to help fix the hiring process, and we talked about the Recruitment One Stop. But there's a whole lot that happens once a candidate I want to be considered for a job. Tell us about what's happening there. Also, what can people expect if you apply for a job? Who's responsible? How is this going?

Mr. Blair: At a bare minimum, we expect agencies to get back with potential applicants. If you file an application for a federal job, we would hope that the agency receiving that application would get back with you either with a letter or with an e-mail acknowledging the application, and at some point letting you know where you may stand in that process.

We've emphasized that agencies shouldn't rely on online technologies alone, that there is a digital divide out there, and that there are people who don't have access to computers for one reason or another, and that agencies should provide the same access to those that we provide to those who do have access to the Internet.

That said, hiring is no longer just within the realm of the HR department. Today's job applicant is not going to wait around 2 months, 3 months, 6 months, or 9 months, to hear back from a potential employer about a job. You have to get back more quickly. We have to make sure that agencies have systems in place that can not only process the applicants that they have, but the back end as well as rating and ranking.

One of the key aspects of the homeland security legislation was it gave agencies some flexibility in how they hire, and the processes that they use in hiring people. There was limited direct hire authority for hard-to-fill jobs in critical occupations. There was the ability to use alternative forms of ranking.

Right now in the federal government, or up until the passage of that legislation, we hired job applicants under what we called the rule of three. The rule of three dates back to 1871. Why we were hiring under a 130-year-old rule is beyond me, and that was one of the key aspects, I think one of the key victories, in that legislation is that we were able to employ more contemporary methods of rating and ranking folks.

But more needs to be done, and the agencies are the ones that have to employ these methods. It is no longer an HR thing. Hiring is no longer an HR thing. Hiring is an issue for agency leadership and management as well because if you're going to have people leaving either to go to the private sector or to other agencies or for other opportunities or retiring, you're going to need to have a process in place that can fill those jobs quickly because if you can't fill the job, you can't do the work that the President and the American people expect you to carry out. So it's very critical that we pay attention this.

One area in which I've been visiting a number of agencies and talking about is we've developed a 30 working day model for hiring a Senior Executive Service member. Before, it had taken 6 to 9 months to hire an SESer, and we know that this can be complicated. That said, if an agency wants to hire someone quickly, we've developed a process, and I have talked to a number of agencies so far about how they can employ this process to bring them on within 30 working days. I think that's an example of what OPM is about now, that we can operate within the current system of flexibilities. While we may need more, we certainly do need to do more of using what we have on hand, and that's what we're about, helping the agencies meet their goals and missions.

Ms. Gardner: You gave us a little bit of historical context, and we've been talking in the present, all the challenges and the strategic initiatives that OPM is involved with. Let's push the button and fast-forward maybe 3, 5, or 10 years.

You've been in government a long time, and you're very familiar with all of the issues you're dealing with. What do you think OPM is going to be doing in 5 to 10 years?

Mr. Blair: That's a good question. There is a definite trend towards decentralization in agency personnel management, and that trend is going to continue. I think, however, we've developed a good template with the Department of Homeland Security in that the core values of the Civil Service were maintained. And I think that that's imperative that the core values of the Civil Service be maintained while giving agencies a maximum amount of flexibility to operate and manage their work forces as best they see fit. We're going to continue to hold agencies accountable, and that trend towards accountability, I think, will only be strengthened over the years, especially as more and more flexibility is accorded to agencies in managing their work forces.

You will always see a need for an Office of Personnel Management, especially when it comes to administering our retirement systems, our health insurance systems, our life insurance systems, and now our new long-term care system. The new long-term care system is up and running now. We had a comprehensive open season ending at the end of the year, and already we predict this to be the largest sponsored long-term care program in the country.

That said, as our population ages, the need for long-term care is not going to decrease, but increase, and so this is going to be an added role for the Office of Personnel Management, and it's going to be part of a competitive benefits package that we want to maintain and make sure that it is competitive and contemporary in order to attract and retain our best employees.

Mr. Lawrence: You've had a chance to take us through the gamut, so I'm curious, what advice would you give to a young person considering a career in public service?

Mr. Blair: I would say the sky is the limit. I think that you can begin at an entry-level job and progress as far as you want to in the federal government. Director James recently addressed a number of visiting students from some historically black colleges and universities, and she told them that the skills and abilities that you have are the skills and abilities you can give to your country.

So, in fact, any job that exists in the private sector probably has a public-sector counterpart in one way, shape, or form. We've seen, since September 11th, a resurgence of interest in public service, and I think that's very important. The functions of government are today more important than ever in securing our homeland and protecting the country and making sure that the country continues to be a beacon of liberty and freedom, and that public service is something to hold your head high up about, and that the sky is the limit when it comes to public service.

Ms. Gardner: I have one more question for you, Dan. What's the highlight, if you could tell us, of your civil service career?

Mr. Blair: I think that's obvious. I think working for the President and this director as the deputy for the Office of Personnel Management. If for some reason it ended tomorrow, it's been a phenomenal, phenomenal opportunity. It's the highest honor that I ever been accorded, and I want to continue working hard for both.

It's an incredible organization. It's a dynamic organization. I have the privilege of working with a director who has vision and boundless energy and wants to create a world-class organization, and I want to be part of that. So keep it coming.

Mr. Lawrence: Dan, I'm afraid we're out of time. Nicole and I want to thank you for being here. You mentioned websites a couple times during our conversation. I can't help but think that someone might be interested and want to learn more. How could they get more information?

Mr. Blair: Let me put my recruiting hat on and say that we have thousands upon thousands of jobs available now, and if you're graduating from college, if you're an executive out there looking for a change, or you're in mid-career and you want to do something different, log on to our website, and it's And we have thousands of jobs listed, an ability to apply for them. There's an online resume builder, and the government needs you, the government wants you. Be a little patient. We still are reengineering our systems, but we really need you, and the time is critical for people with good skills.

Mr. Lawrence: Thank you, Dan. This has been The Business of Government Hour featuring a conversation with Dan Gregory Blair, deputy director of the Office of Personnel Management. Be sure and visit us on the web at There you can learn more about our programs and research and get a transcript of today's fascinating conversation. Again, that's This is Paul Lawrence. Thank you for listening.

Dan Blair interview
Mr. Blair serves as the first Chairman of the independent Postal Regulatory Commission, the successor agency to the former Postal Rate Commission.

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