Memo to the new mayor; how to made a big city work.

AuthorShuger, Scott
PositionSharon Pratt Dixon of Washington, D.C. - Includes related article on city employee reduction

TO: SHARON PRATT DIXON FROM: SCOTT SHUGER RE: WHAT YOU NEED TO DO NOW

You staked your campaign on the pledge to cut the city's bureaucracy, and yesterday the voters said: "Do it." This is an unbelievable opportunity: the first hopeful moment in District of Columbia politics in a decade and also a chance to show New York, Philadelphia, Detroit, and all the other rotting big city governments how to use personnel cuts to pull back from the brink of chaos and insolvency--to make our schools work, our families secure, and our streets safe. Let's not blow it. Let's get started today.

"Immediately upon entering office, I will conduct a thorough management audit to identify those agencies that are bloated and inefficient," you told us during the campaign. "I intend to cut 2,000 mid-management level paper pushers from the government payrolls." What's worrying me now is that you never went on to say anything more than this about cuts. You recently admitted to the Monthly that the 2,000 figure was just "a conservative judgment to give the public a sense of definition of what I'm talking about," and that you would make greater cuts "before we tax everybody out of the city." You should have said the same thing loud and clear during the campaign. Doubletalk about the size of the cuts is deadly most of all because your great strength as a leader is that you tell it like it is.

I'm writing now to raise issues you have to confront starting today if the cause of government efficiency in the District is ever going to be more than just another campaign buzzword:

  1. Making the city work will require firing a lot more than 2,000 people. Its payroll of 48,000 people--the costs of which take up half the city's annual budget--gives the District nearly twice as many nonfederal government employees per capita as California, Florida, or Michigan. And businesses that have shrunk to boost productivity illustrate proportionally much larger cuts than the 4 percent you've advocated. From 1981 to 1989, GE increased its productivity more than threefold and its market value more than fourfold while reducing its salaried staff by 40 percent. (Incidentally, business comparisons aren't made often enough by those in government: One assumption that has no place in bureaucratic reform is "close enough for government work"--the idea that government agencies must be inherently sloppier and less focused than businesses, and hence can learn nothing from them. Even in the District's government there are counterexamples to that: trash collection and parking meter enforcement come to mind. Indeed, comparing the Teutonic precision of the District's parking ticket writers with the Sovietized slow-motion of its ticket processors downtown should suggest that government per se is not the problem.)

    As you know, in any organization, there are jobs that are directly related to the manufacture of the product or the delivery of the service and those that are not. Although many of the latter are legitimate managerial, advisory, or technical jobs, once you get away from identifiable makings and doings, there's much greater potential for jobs that don't really count. That's why productive operations exhibit low "mid-level-chiefs/Indians" ratios.

    It's scandalous that the city government has taken absolutely no interest in discovering its own chiefs and Indians structure. Nobody among the 371 employees in the D.C. Office of Personnel--an organization that doesn't know it has almost twice as many chiefs as Indians. Not the Suprvisory Personnel Management Specialist (salary: $70,013). Not the Human Resource Development Officer ($64,041). Nor the Supervisory Personnel Staffing Specialist ($50,653). One official in the city budget office told me, "No one has ever asked that question before. But one of the guys said that if you find anything out, they'd sure be interested in the answer." Curiously, this same man later told me that the problem with saying that you could save money by cutting mid-level people is that there are not enough of them. How does he know? Apprised of the city's utter lack of self-knowledge, a federal personnel official said, "I don't know how they could run a city without knowing that."

    A mid-level-chiefs/Indians ratio of .25 means that you have one mid-level chief for every four Indians; generally, an organization fares best when it attains a ratio considerably smaller than that. Quad/Graphics, the company that prints Time, Newsweek, and the L.L. Bean catalog, has a mid-level-C/I ratio of .11. In its most recent fiscal year, Federal Express turned a profit of $115 million on a mid-level-C/I ratio of .065. Last year, the Fiat auto division made $1.8 billion on a mid-level-C/O of about .045.

    One way to see just how far the District has to go to attain real efficiency is to look at its mid-level-C/I. The city's personnel categories are...

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