May 8, 2001
TO THE HEADS
AND ACTING HEADS OF EXECUTIVE DEPARTMENTS AND AGENCIES
Workforce Planning & Restructuring
- Instructs Executive
agencies and departments ("agencies") to submit a workforce
analysis to OMB by June 29, 2001. This is the initial phase of
implementing the Presidents initiative to have agencies
restructure their workforces to streamline organizations; and
- Provides preliminary
guidance on the development of agency-specific restructuring plans
in the context of an agencys FY 2003 budget request and
annual performance plan.
White House Chief of Staffs January 20th "Hiring Controls"
Memorandum stated that in the long term, every agency head will
be expected to develop a plan to meet the Presidents goal
of reducing management ranks and that OMB would issue guidance on
the development of those plans. Additionally, the Directors
February 14, 2001 Memorandum "Performance Goals and Management
Initiatives for the FY 2002 Budget" directs agencies to include
delayering of management levels to streamline organizations as a
performance goal in their FY 2002 Budget requests and annual performance
Furthermore, the Presidents
FY 2002 Budget announces: "the first priority of the Presidents
Government reform initiatives is to make Government citizen-centered.
This means ensuring that there is as little distance as possible
between the citizens and decision-makers. To shrink the distance
between citizens and Cabinet members, the Administration will flatten
the Federal hierarchy, reduce the number of layers in the upper
echelons of Government, and use workforce planning to help agencies
and redistribute higher-level positions to front-line, service-delivery
positions that interact with citizens."
Bulletin applies to agencies with more than 100 FTE (see Attachment
A). Agencies with fewer than 100 FTE may voluntarily comply.
Each covered agency should: provide summary information on its workforce
analysis to the agencys OMB representative no later than June
29, 2001; and develop a restructuring plan as part of its FY 2003
budget submission and annual performance plan.
Streamline Organizations. Each agency is asked to prepare a
restructuring plan based upon a workforce analysis to make the Government
more citizen-centered by, as appropriate:
- Deploying resources
to direct service delivery positions that interact with citizens;
- Using workforce planning
to flatten the Federal hierarchy, increase the span of control,
reduce the time it takes to make decisions, and reduce the number
of layers in Government.
Each covered agency
should prepare a workforce analysis by bureau or organization that,
at a minimum:
- Provides information,
as of September 30, 2000, on the demographics of the permanent
workforce including age, grade, retirement eligibility and expected
retirements over the next five years, and attrition, including
trends in recent retirements over the past five years;
- Provides information,
as appropriate, on the agencys seasonal, temporary, and
intermittent workforce for FY 2000, including number and occupations
of employees in each category and duration and periodicity of
- Evaluates the skills
of the workforce (see the questions below); and
- Identifies each supervisor/manager
as reported to the Central Personnel Data File by occupational
title, grade level, geographic location, and supervisor-to-staff
This analysis will serve
as the baseline for the agency-specific restructuring plan. The
analysis should be fully consistent with: actions taken by the agency
to implement other management reform initiatives, including those
addressed in OMB Memorandum M-01-15 making greater use of performance-based
contracts, expanding the application of on-line procurement, and
expanding A-76 competitions and increasing the accuracy of FAIR
Act inventories (see Attachment B); and with the agencys biennial
SES allocation request to the Office of Personnel Management (OPM).
Agencies should prepare
a summary of its findings that addresses each of the
above elements. To the maximum extent possible, data used in the
analysis should be consistent with that reported to OPM; any deviations
should be noted. In addition to the summary data, agencies
should address the following questions:
- What skills are currently
vital to the accomplishment of the agencys goals and objectives?
- What changes are
expected in the work of the agency (e.g. due to changes in mission/goals,
technology, new/terminated programs or functions, and shifts to
contracting out)? How will this affect the agencys human
resources? What skills will no longer be required, and what new
skills will the agency need in the next five years?
- What recruitment,
training, and retention strategies are being implemented to help
ensure that the agency has, and will continue to have, a high-quality,
- How is the agency
addressing expected skill imbalances due to attrition, including
retirements over the next five years?
- What challenges impede
the agencys ability to recruit and retain a high-quality,
- Where has the agency
successfully delegated authority or restructured to reduce the
number of layers that a programmatic action passes through before
it reaches an authoritative decision point (e.g. procuring new
computers, allocating operating budgets, completely satisfying
a customers complaint, processing a benefits claim, and
clearing controlled correspondence)? Where can the agency improve
its processes to reduce the number of layers that a programmatic
action passes through before it reaches an authoritative decision
point? Please provide at least two examples of each.
- What barriers (statutory,
administrative, physical, or cultural) has the agency identified
to achieving workforce restructuring?
This information should
be provided to the agencys OMB representative no later than
June 29, 2001. Agencies may be asked to provide additional information.
Based on the workforce
analysis, agencies should, as a part of the FY 2003 budget submission
and annual performance plan, develop a five-year plan to identify
the specific organizational changes the agency is proposing to:
reduce the number of managers, reduce organizational layers, reduce
the time it takes to make decisions, increase the span of control,
and redirect positions within the agency to ensure that the
largest number of employees possible are in direct service delivery
positions that interact with citizens and retrain and/or redeploy
employees as part of restructuring efforts. Include in the plan:
- Organizational charts
showing the changes from the baseline levels in the organizations
program and staffing structure and work processes that would be
accomplished by the proposal;
- Costs and/or savings
that will result in the first year and over five years from implementing
these changes at the account and/or program level as appropriate;
- The human resources
management tools and flexibilities needed to implement the plan;
- The specific actions
to be taken, with a timetable; and
- The anticipated impact
that these changes will have by fiscal year and the agencys
plan for measuring progress.
OMB and OPM will work
closely with agencies to implement the Presidents initiative.
In addition to this Bulletin, OPM has tools to help each agency
conduct a workforce analysis and is prepared to provide guidance
and assistance as needed.
on agency-specific restructuring plans and other aspects of agency
budget submissions and annual performance plans will be provided
in OMB Circular No. A-11, which will be issued this summer.
regarding this Bulletin should be directed to the agency's OMB representative.
Specific questions on conducting a workforce analysis should be
directed to Employment Service, OPM at 202-606-6500.
Mitchell E. Daniels, Jr.
A, Executive Branch Agencies with more than 100 FTE
B, Performance Goals and Management Initiatives for the FY