GAO Promotes Reform in Human Capital Management – Part I

Reform is needed in human capital management, according to the U.S. Government Accountability Office (GAO). As we’ve entered the 21st century, this need has increased, and is compounded by long-term fiscal management issues and ever-changing threats to national security.

Why Reform Now?

The GAO says that in order to address the complex challenges faced by individual agencies, the Government sector and the nation as a whole, we must focus on our most valuable asset: human capital. Without the support of qualified individuals with the experience and drive necessary to make change happen, the efforts of agencies to prepare for and protect their constituents against modern challenges and threats are fruitless.

The Challenge Facing Federal Agencies

Unfortunately, many Government agencies are stuck in their old model of thinking. They lack modern methods for classifying, compensating, developing and motivating employees to embrace the change needed for today’s fast-paced environment. Many Government employees are continuously in a state of turmoil, as constant political upheaval threatens to change programs that have existed for decades. Government sector employees must be adaptable to rapid change and willing to accommodate last-minute policy changes and even drastic procedural revisions.

The GAO acknowledges that within some sectors, progress has been made in managing the human capital investment. However, a Government-wide reform in the way we address and manage our most valuable asset is critical to the forward motion of any initiative.

Looming Retirement Threatens Human Capital Assets

About one-third of Federal employees working 5 years ago have reached or will reach retirement eligibility age by the end of 2012. A mass retirement exodus is leaving many Federal agencies and sectors at a significant disadvantage. Training costs can be substantial, especially for higher-level employees. Even for lower-level positions, agencies take a risk in hiring new talent and training them on the specifics of their job duties, which often involve high-security tasks.

Human capital management has been a high risk for Government agencies since 2001. The GAO brings attention to the importance of human capital in achieving an agency’s mission and goals within ever-challenging fiscal constraints. Even as some employees retire, replacing older workers can be costly, as starting wages are much higher than just a few decades ago.

The GAO has identified five key principles to address during strategic workforce planning. These include: involving top management and other stakeholders in planning, determining future critical competencies, developing strategies to address anticipated gaps, building the administrative and educational capability to support those strategies, and monitoring progress toward goals.

Challenges to Implementing Human Capital Reforms

You’re sold on the need for human capital reform, and you’re ready to take action within your agency, but where do you begin? First, examine your foundation:

  • Do you currently have a process linking human capital efforts to program goals?
  • Do you have the expertise needed to design and implement an effective human capital management program?
  • Does your agency employ a modern, effective performance management system?
  • Are precautions in place to ensure the safety and fair treatment of employees?

If you answered “No” to any of the questions above, start by engaging the experts you need to lay the foundation for maximizing your human capital investment. Once you have completed the groundwork, you will be able to develop the strategic plan and culture for nurturing a productive workforce.

Check back soon and look for Part 2 of this article series for more ideas on how to create a positive culture for effective human capital management.

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