ONE OF THE CENTRAL THEMES of this book is that the management of government agencies is powerfully constrained by limitations on the ability of managers to buy and sell products or hire and fire people on the basis of what best serves the efficiency or productivity of the organization. Laws and regulations limit how people can be hired, greatly reduce the chances of firing anyone, and surround the buying and selling of buildings and equipment with countless rules about fairness and procedure.
There have been efforts over the last decade to alter these constraints. President Bill Clinton and Vice President Al Gore sought at the start of their first term to convert federal agencies into a government that "works better and costs less" by reducing red tape, inducing bureaus to put customers (that is, citizens dealing with the government) first, and empowering employees to get results. This effort was officially known as the National Performance Review (NPR) and popularly known as Reinventing Government, or REGO.1
The NPR effort marked a sharp departure from past reorganization plans. Of the seventeen presidents to take office between 1904 and 1992, eleven created reorganization task forces that were chiefly devoted to expanding accountability, increasing efficiency, and enlarging presidential authority.2 (By accountability I mean increasing policy implementers' responsiveness to higher officials who must take responsibility for that policy.) This effort had some successes--for example, it equipped the president with more staff assistants and made more rational the way in which budgets were drawn up--but it did little about red tape.
The NPR began with very different assumptions. Where earlier reforms had stressed the accountability of officials to higher authority, the NPR emphasized agency responsiveness to the public. Where earlier reports relied on appeals to business efficiency, the NPR drew inspiration from the concept of entrepreneurial culture. And where preceding efforts urged an expansion of the power of the president, the NPR called for empowering government employees and restoring public confidence in government.
The dominant theme of the NPR was to solve the "root problem" of modern government--its excessive reliance on "large, top-down, centralized bureaucracies." This solution necessitated the creation of "entrepreneurial organizations" that have "constantly learned, innovated, and improved."3 The NPR meant, in effect, marrying the youthful spirit of Silicon Valley to the old traditions of official Washington.