RTC# 03-219 attachment

CITY OF SUNNYVALE

OFFICE OF THE CITY MANAGER

Interoffice Memorandum

TO: The Honorable Mayor and City Council Members

THROUGH: Robert S. LaSala, City Manager

FROM: Charles J. Schwabe, Deputy City Manager

SUBJECT: Results of Proposed Additional Reductions to Program 734 Organizational Effectiveness

DATE: June 16, 2003

Executive Summary

Additional reductions have been proposed for Program 734 Organizational Effectiveness. If enacted, these reductions would reduce the funding level by $345,000, and eliminate two of three remaining staff positions. Only partial funding would be available for the remaining regular, full time position. The program's work plan for FY 2003/2004 would be severely diminished, cutting back on planned PAMS training, implementation of performance audit recommendations, internal consulting assignments, and improvements to outcome management.

Planned FY 2003/2004 Work Plan

The recommended budget for FY 2003/2004 for the Organizational Effectiveness Program is $507,078, after reductions recommended by the City Manager. This funding level will provide for the following work plan. Key assignments include:

Performance audit recommendations, Program staff would work closely with the Finance Department and operating departments to implement the recommendations generated through performance audits that were completed this year.
Rebuilding PAMS. Program staff would rebuild PAMS, providing training for managers, and rewriting outdated manuals and procedures.
Outcome Management System. Program staff would complete key program restructures in the Public Safety Department and other departments, and complete an overall improvement to this vital planning and management system.
Service Delivery. Program staff would work with employees and work groups in other departments to improve service delivery by reviewing, analyzing, and rebuilding processes used by departments for delivering services.

Equally important, there would be time available for the planned special projects that are assigned to program staff. Developing the 6-Point Action Plan to the budget crisis and staffing the Ad Hoc Advisory Committee on Taxes are two examples of key special projects that consumed hundreds of hours of staff time this year. Similar projects will emerge next year; there will need to be work hours available in this program to respond. Given the staffing reductions in other departments, there will not be other programs to assign this work.

Results of Proposed Additional Reductions

Council Member Fowler has proposed a package of reductions to activities that totals $345,000. The following information describes the results of the proposed reduction on the program's work plan, service levels, funding level, and staffing level for next fiscal year.

Next Fiscal Year's Work Plan. The proposed reduction will reduce the total number of work hours in this program to less than a full time, regular employee. Consequently, the work plan would need to be significantly scaled back. For example:

Implementing performance audit recommendations will fall primarily to the Finance Department. Given staffing reductions in this department, only a few performance audit recommendations could be implemented. Finance staff would also have less time to complete future performance audits if staff were working on implementation activities.

PAMS could not be rebuilt next year, resulting in a multiple year effort versus a single year project. It would not be possible to train new managers on all PAMS systems.

Outcome management related activities would focus solely on program restructures planned for the Public Safety Department. Other department's program restructures will be deferred. A comprehensive review of the outcome management system will be placed on hold.

Few work hours will be available for internal consulting assignments. This could increase the need for outside consulting services, or defer work that would lead to service delivery improvements.

Service Levels. The proposed reduction eliminates 12 of 22 activities that make up this program. Without these activities, the following changes would be required:

Quarterly Performance Report. This activity is used to prepare the Trimester Program Performance Reports and the Proposed Performance Exception Report that the City Council recently approved as part of the new policy direction on budget appropriation control. Neither report will be prepared if this activity is eliminated.

Annual Performance Report. This activity was intended to be used to prepare the annual Quality of Life Index and Assessment Report. It is also used to provide departments with a consolidated report of all outcome and performance measure results. Neither report will be prepared if this activity is eliminated.

Training on PAMS components is provides both new and experienced managers with better skills for using the various parts that make up PAMS. No training will be provided on the non-routine process, the Performance Outcome Agreement process, the outcome management system, or other PAMS components if this activity is eliminated.

External and Internal Customer Satisfaction Surveys. These surveys provide results that are used by managers and employees to determine whether they are meeting customer satisfaction performance goals set by the City Council. Program managers will be required to design, conduct, and analyze their own surveys, which in the past have contained biased questions and inaccurate results.

Employee Attitude Survey. This survey is conducted to determine levels of employee moral and satisfaction with key aspects of the work environment. Without this information, managers and employees will be less able to identify problems early before they become crisises.

City Manager Annual Performance Report. This activity consolidates information from 10 department annual performance reports, along with performance information requested by the City Council on other issues, into an Annual Performance Report for the entire organization. In addition, Council indicated its preference to receive this report earlier in the fiscal year. If this activity is eliminated, this report will contain less information and be prepared later than both the City Manager and the Council would like.

Work System Assessment and performance audits are used to improve service delivery. Program staff completes this work through internal consulting assignments. Eliminating this activity will result in less performance audit recommendations implemented and significantly less work accomplished on rebuilding PAMS.

Customer Service Training: These activities help front line employees improve their skills in meeting customers' needs. If eliminated, this work would fall to other departments, or not be done.

Non-Routine Process. Through this activity, program staff assist employees in developing non-routine projects for review and approval. Without this activity, employees would complete the non-routine process without consulting help.

Operations and Planning Meeting. This activity captures work hours for planning and attending OPM meetings.

Funding and Staffing Levels. Program funding would be reduced by $345,000. No funds would be available for operating expenses, and purchased goods and services. Two of three remaining positions would be eliminated (one management analyst and one senior office assistant). Remaining funding would be used for to partially fund the deputy city manager's position.

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