VBA’s Executive Performance Appraisal System

A New Approach to Executive Performance Management

Senior Executive Service in VBA

• Total SES - 57– Headquarters SES - 15– Field SES - 42

• VBA comprised of (57) Regional Offices and Centers along with Headquarters elements

State of VBA - 1997

• Environmental scan revealed– Large Backlogs– Large Appellate Workload– High Remand Rate– High Blocked Call Rates– Poor Customer Satisfaction– Lack of Succession Planning– Poor Data Integrity

State of VBA - 1997

• Veterans Claims Adjudication Commission “Report to Congress” - December 1996

• National Academy of Public Administration report on “Management of the Compensation and Pension Benefits Claim Processes for Veterans” - August 1997

Improved service delivery to veterans– Increase Accessibility– Improve Efficiency– Reduce Redundancy– Promote Cooperation/Teamwork– Eliminate Destructive Competition– Push Decision Making to Lowest Level– Promote Flexibility in Decision-Making

Service Delivery Networks

VBA Service Delivery Networks

1

2

34

5

6

7

8

9

Seattle

Portland

Boise

Salt Lake

Ft. Harrison

Cheyenne/Denver

Denver

Albuquerque

Fargo

Sioux falls

Lincoln

Wichita

St. Paul

Des MoinesChicago

St. LouisSt. Louis RMC

Milwaukee

Reno

Oakland

Los Angeles

Phoenix

Waco

Houston

Muskogee Little Rock

New Orleans

JacksonMontgomery

St. Petersburg

Indianapolis

Detroit

Cleveland Pittsburgh

Louisville

Huntington

Roanoke

Nashville

AtlantaColumbia

Winston Salem

Buffalo

ANCHORAGE

HONOLULU

SAN JUAN

TogasManchester

White River Jct.

BostonProvidence

HartfordNew York

NewarkPhiladelphia

WilmingtonBaltimoreWashington

MANILA

San Diego

Why Develop a New Performance Measurement

System?• To encourage teamwork throughout VBA -

consistent with the SDN concept

• To leverage performance measured on the Balanced Scorecard

• To foster development of key executive competencies

• To tap the insights of peers, subordinates and stakeholders (360 degree feedback)

Executive Performance Appraisal Plan Development

• The plan is aligned with VBA’s corporate philosophy

• Development Team was comprised of Directors from the field

• Field survey was conducted with the best ideas incorporated in the final plan

• Performance expectations from senior level VBA management were incorporated in the final plan

Elements of the Executive Performance Appraisal System

Element 1 - Balanced Scorecard Performance

Element 2 - Organizational Support/Teamwork

Element 3 - Leadership Development

Element 4 - External Relations

Element 5 - Workplace Responsibilities

The VBA Balanced Scorecard

• Each major business line (Program) has a Balanced Scorecard with unique measures

• Measures were selected based on management experience; customer & stakeholder interest; and benchmarking with similar organizations

• Balanced Scorecards developed at the Local, Service Delivery Network, and National levels

The Balanced Scorecard

Balanced Scorecards for each business line contain the following key elements:

– Speed

– Accuracy

– Unit Cost

– Customer Satisfaction

– Employee Development

National Loan Guaranty Business Line Scorecard

Category SPEED ACCURACY UNIT CO ST CUSTO MER SATISFACTIO N EMPL. DEV. & SAT.

Weight 15% 30% 15% 25% 15%

Measure

Acq

uire

d P

rop

erty

Hol

ding

T

ime

(mon

ths)

(2)

Pro

cess

ing

tim

e fo

r el

igib

ility

ce

rtif

icat

es (

2)

Pro

cess

ing

tim

e fo

r va

lue

dete

rmin

atio

ns (

day

s) (

2)

For

eclo

sure

Avo

idan

ce

Thr

ough

Ser

vici

ng (

FA

TS)

ra

tio

(2)

Stat

isti

cal Q

ualit

y C

ontr

ol

(SQ

C)

Inde

x (4

)

Ret

urn

on S

ales

of

Acq

uire

d P

rop

erti

es (

RO

S) (

2)

Adm

inis

trat

ive

cost

per

loan

gu

aran

ty is

sued

(5)

Adm

inis

trat

ive

serv

icin

g co

st

per

def

ault

pro

cess

ed (

5)

Adm

inis

trat

ive

cost

per

p

rop

erty

sol

d (5

)

Vet

eran

Sat

isfa

ctio

n In

dex

Len

der

Sati

sfic

atio

n I

ndex

Tel

epho

ne A

ctiv

itie

s -

Aba

ndon

ed C

all R

ate

Tel

epho

ne A

ctiv

itie

s -

B

lock

ed C

all R

ate

Em

plo

yee

Dev

elop

men

t Sk

ill

Mat

rix

One

VA

Sur

vey

(m

ean

scor

e)

(6)

Strategic O bjective 8 5 15 40% 98% 100% $125 $320 $0 95% 80% TBD TBD TBD 4

FY 2000 Targets 9 7 19 39% 97% 98% TBD TBD TBD TBD TBD TBD TBD TBD 3

Zero Value 15 15 30 18% 80% 80% TBD TBD TBD 80% 50% TBD TBD TBD 1

Actual 8.2 4.9 15.0 29.9% 93.2% 99.5% $291 $96,212 $1,725 TBD TBD TBD TBD TBD 3.3Earned Points 4.8 5.0 5.0 8.1 11.0 2.4 TBD TBD TBD TBD TBD TBD TBD TBD 3.9Maximum Points 5.0 5.0 5.0 15.0 15.0 2.5 5.0 5.0 2.5 7.5 7.5 5.0 5.0 10.0 5.0

Total Score 40.3 x1.90 76.8 NOTES:Maximum Score 53 x1.90 100 (1) Reflects monthly data

(2) Reflects FYTD data (thru current month)(3) Reflects FYTD data (thru prior month)(4) Reflects 12-month cumulative data(5) Reported quarterly(6) Reported annually(7) End of month snapshot

Balanced Scorecard Performance Element 1

Organizational Level Percent of Rating underElement 1 for each Director

Balanced Scorecard Target

VBA 15% Established by UnderSecretary for Benefits

SDN 50% Negotiated between the SDNand Office of FieldOperations

Regional Office 35% Negotiated between the SDNand Office of FieldOperations

Organizational Support/TeamworkElement 2

Sub-Element 1 – Support for the SDN Concept through

participation in National and SDN Projects and support of Innovation

Sub-Element 2 – Peer Review of Teamwork

Support for the SDN ConceptSub-element 1

• Participation in projects at the SDN level

• Participation in projects at the National level

• Promoting and sharing “Innovative” ideas and business practices

Peer Review of TeamworkSub-element 2

• Designed to evaluate effectiveness as a SDN team-member

• A peer evaluation survey instrument was developed with the help of outside contractors

• Directors are also required to complete a self-assessment

• Results are discussed with fellow team-members

Teamwork Assessment Feedback Dimensions

Directors are rated on a scale of 1 to 6 in the following categories

– Respect and Openness– Communication– Managing Performance– Innovation– Budget and Resource Planning– Budget Execution/Resource Sharing– People Development

Peer Review Observations

• FY 2000 results not used for rating purposes

• Evaluations appear to be inflated

• The process resulted in open and frank discussion among Directors

• Results will be used for rating purposes in FY 2001

Leadership DevelopmentElement 3

Sub-element 1– Leadership Development Plan

Sub-element 2– 360 Degree Performance Assessment

Leadership Development PlanSub-element 1

• Tied to Office of Personnel Management core competencies

• Directors required to assess strengths as well as weaknesses

• Supervisors required to identify developmental issues

• An Individual Performance Plan is required for each performance period

360 Degree AssessmentSub-element 2

• Difficult concept for senior executives to accept

• Directors must be assessed in the normal performance of duties

• VBA has elected to utilize the FEI instrument

• Concept to be tested in the FY 2001 executive performance appraisal process

External RelationsElement 4

Building effective, productive relationships with organizations external to VBA in support of the overall VA mission and goals

– Participation in the Federal Executive Board– Working with other elements in VA (e.g., VISN

or NCS)– Fostering productive relationships with service

organizations, congressional staff, and local media

Workplace ResponsibilitiesElement 5

• Effective labor/management relationships

• Discrimination-free work environment

• Diverse workforce

• Effective recruitment, training, retention, and employee development

• Safe and healthy work environment

VBA Executive Performance Appraisal System - where are we?

An organizational framework is in place to– Hold Directors accountable for their

performance– Link actions to corporate goals and objectives– Promote cooperation and teamwork in

furthering VA’s mission– Ensure universally consistent performance

assessment of senior VBA leaders

VBA Executive Performance Appraisal System - what’s next?

• Continue to develop the peer assessment process

• Finalize details on the 360 degree performance assessment process

• Shift the weighting in Element 1 to encourage ownership in national goals and objectives