What did NAPA recommend for OPM? And are they correct?

Last week the National Academy of Public Administration (NAPA) issued its long-awaited report on the Trump Administration proposal to abolish the Office of Personnel Management (OPM) and move most of the OPM mission to the General Services Administration (GSA). The bottom line from NAPA’s report is this:

“The need for an independent, enterprise-wide human capital agency and steward of the merit system principles is clear, as is the critical need to rebuild staff capacity, encourage innovation, and adopt a more data- driven, accountable, and forward-looking human capital approach. In addition, human capital management must be elevated. The OPM Director — and human capital as a whole — needs a “seat at the table.” The Director should be the principal advisor to the President on human capital, as envisioned in the Civil Service Reform Act, and OPM should be that lead for federal civilian human capital, setting policy, establishing a framework for agencies to manage their workforces, facilitating innovation and the sharing of best practices and lessons learned, and both collecting and using data and data analytics.”

There is a lot to unpack in those few sentences, so let’s go through it step by step and look at what it might mean if Congress and the Biden Administration accept and implement NAPA’s recommendations (as they should).

First up is “independent.” When OPM was created by the Civil Service Reform Act of 1978 it was intended to be an Independent agency. In practice, OPM is not independent at all. It has become, as NAPA’s panel observed, more and more subservient to the Office of Management and Budget (OMB). Some argue that OMB is more flexible and innovative, while others will argue that OMB is more political because it is part of the White House. I believe OMB has capitalized on OPM’s weaknesses to exert too much control over OPM and its programs, and has contributed to OPM’s weakness. Former Obama Administration OPM Director John Berry referred to OMB as “the big dog” and OPM as “the flea.” If OPM is to ever recover, that must change and OPM must be independent of OMB.

Next is “enterprise-wide human capital agency.” It may surprise readers to learn that OPM does not have policy oversight for large segments of the federal workforce. They are primarily focused on those agencies and employees covered by Title 5 of the United States Code. That means there is no government-wide approach to managing the workforce. No one has the reins. There is no strategy, no comprehensive view of the workforce, and no way to effectively deal with the government’s workforce needs. OPM’s scope must be expanded to cover the entire federal workforce. Doing so will require Congress to expand OPM’s authority. They should do so and President Biden should sign it.

NAPA cited “the critical need to rebuild staff capacity” at OPM. Amen. OPM has been on a gradual decline since the Clinton Administration gutted federal Human Resources offices and OPM as part of the National Performance Review. OPM’s decline accelerated when the Trump Administration proposed abolishing the agency and moving most of its work to GSA, except for a handful of policy people who would be moved to OMB. OPM is an essential agency and it must be restored. Reversing decades of decline is not going to be easy. OPM needs resources, including appropriated dollars to cover all of its policy and oversight work. They need more staff, better technology, and time to make the changes.

Transforming OPM is far more than throwing money at it and hiring more people. It also requires a change in mindset at the agency. NAPA said they should “encourage innovation.” Innovation is not something OPM is known for. In fact, the agency has a history of discouraging innovation by agencies. When OPM has flexibility they are hesitant to use it. Their lawyers tend to say no far more than they say yes. A robust embrace of innovation is the foundation of a rebuilt OPM. Without it, all the dollars the government can print will not make a difference.

NAPA recommended that OPM “adopt a more data- driven, accountable, and forward-looking human capital approach.” The federal government has massive amounts of data regarding its workforce. For the most part that data goes into a black hole and is never used. The analytics that could make it useful are nowhere to be found. Technology is used, but stovepipes too much. That stovepiping continues in the way OPM and agencies do their work. Lasting changes in federal human capital management require data, both to decide what needs to be done and whether programs are effective. Absent data, we are just taking shots in the dark.

An important aspect of NAPA’s findings is the idea that “The (OPM) Director should be the principal advisor to the President on human capital.” As NAPA observed, that simply is not the case. As OMB has asserted more control over OPM and workforce policies, the Director of OPM has become far less influential. I agree with NAPA’s panel that the OPM Director should be the principal human capital advisor to the President. I would take that a step farther and designate the OPM Director as a member of the President’s Cabinet, as President Bill Clinton did with former OPM Director Janice Lachance. I believe that is the best way to ensure the OPM Director is able to carry out the role it was intended to serve.

NAPA’s panel did a thorough job in laying out the issues. It concluded that there was no information that supported the Trump Administration proposal. It also highlighted the sidelining of the Chief Human Capital Officers Council in recent years. I agree completely. The CHCO Council should serve as a sort of board of directors for OPM, yet OPM has often ignored the Council. The NAPA report highlights the lack of clout of the CHCO Council as compared to the CIO Council and others. That should be changed and the CHCO Council given more influence.

One area that I wish the NAPA panel has explored in more detail is OPM’s fee-for-service business, particularly development of HR software. I agreed with OPM’s decision during the Obama Administration to bring USAJobs in house, Part of the argument OPM used for bringing USAJobs in house was that having a job board that was accessible to multiple vendors would encourage innovation in hiring tools. Their development of an expanding suite of HR software may be stifling innovation in the field. For more on that, take a look at this post from 2019.

Overall, I believe NAPA’s report was excellent. The next steps will require the Biden Administration to embrace the recommendations and the Congress to reform OPM’s enabling legislation and appropriate sufficient funds for OPM to rebuild. I believe that is essential if we are going to build the workforce capabilities the government needs.

Jeff Neal authors the blog ChiefHRO.com and was previously the chief human capital officer at the Department of Homeland Security and the chief human resources officer at the Defense Logistics Agency.

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