Government Contracts Monitor

\'Deficit of Accountability\' Spurs Creation of Performance Czar Post

January 7, 2009

President-Elect Obama today nominated Nancy Killefer as the government's first-ever Chief Performance Officer, a.k.a "Performance Czar." 

Killefer, a former assistant secretary in the Clinton Treasury Department and a senior director with McKinsey and Co., will lead the President-Elect's initiative to control federal spending, reform government entitlement programs, and to cut back on federal earmarks.

In his blog, Steve Kelman of Harvard’s Kennedy School of Government, hails Killefer’s emphasis on using performance measures as a “fantastic signal of a progressive approach to public management.”  He reports:

The [Chief Performance Officer] will work with federal agencies to set tough performance targets and hold managers responsible for progress.  The president will meet regularly with cabinet officers to review the progress their agencies are making toward meeting performance improvement targets.

Killefer brings a uniquely business-oriented approach to OMB.  All indications are that Killefer will be tasked with making agencies make do with less (as if there were an alternative) and to be held more accountable for what money they do spend.  President-Elect Obama hailed the appointment as “one of the most important” he will make, adding:

“Our problem is not just a deficit of dollars.  It’s a deficit of accountability…a deficit of trust.”

What does this mean for the procurement community?  The Killefer appointment signals a move towards increased scrutiny and streamlining of agency processes.  In a 2006 BusinessWeek article, Killefer calls for a “radical new approach to transparency” and noted that Congress and the White House have “plenty of tools to improve public agencies.” 

Under the Obama Administration, expect federal agencies to be held to more scrutiny in their purchasing decisions (perhaps further expanding GAO’s bid protest jurisdiction over orders placed under existing multi-vendor contracts) – which may result in an uptick in contracts awarded with full and open competition and more procurement-related information becoming publically available (a la www.usaspending.gov).  Federal Agencies will be held more accountable and may be forced to go to greater lengths to support their procurement decisions.