Streamlining Government: Opportunities Exist to Strengthen OMB's Approach to Improving Efficiency Page: 9 of 73
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In response to your request, this report examines (1) the types of
efficiency measures reported through PART for agency programs overall,
and particularly for selected programs in five selected agencies, focusing
on the extent to which they included typical elements of an efficiency
measure, (2) for selected programs, the extent to which programs
reporting efficiency measures through PART have shown efficiency gains
and how programs have used efficiency measures for decision making,
(3) for selected programs, the types of challenges to developing and using
efficiency measures they have faced, and (4) other strategies that can be
used to improve efficiency.
Based on our review of the literature,8 an efficiency measure is typically
defined as the ratio of two elements: a program's inputs (such as costs or
hours worked by employees), to its outputs or outcomes. Outputs can be
defined as the amount of products or services delivered by a program.
Outcomes can be defined as the desired results of a program, such as
events, occurrences, or changes in conditions, behaviors, or attitudes. In
some literature, the inverse ratio of outcomes or outputs to inputs is
referred to as a "productivity" measure,9 but for purposes of this report,
we refer to either form of the ratio as an efficiency measure. It should be
noted that an improvement in efficiency can be achieved by maintaining
quantity or quality of outputs or outcomes while reducing costs, as well as
by improving the quantity or quality of outputs or outcomes while
maintaining (or reducing) costs. Thus an improvement in efficiency need
not involve a reduction of costs.
OMB initially described an efficiency measure as the ratio of a program's
outcomes or outputs to inputs in the 2004 PART guidance. In the
December 2007 PART guidance, OMB termed this type of ratio an "input
productivity measure," and indicated that such measures could provide a
useful approach for identifying efficiency measures. In the guidance, OMB
also identified erroneous conclusions that can result from the use of
simple output-input ratios to track changes over time in efficiency for
programs that do not produce the same or similar outputs repetitively.
OMB also identified challenges facing efforts to measure efficiency in
research and development programs and construction of special purpose
8See, for example, Harry P. Hatry, Performance Measurement: Getting Results, Second
Edition (Baltimore, MD: The Urban Institute Press, 2007).
9See, for example, GAO, Tax Administration: IRS Can Improve Its Productivity
Measures by Using Alternative Methods, GAO-05-671 (Washington, D.C.: July 11, 2005).
GAO-10-394 Streamlining Government
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United States. Government Accountability Office. Streamlining Government: Opportunities Exist to Strengthen OMB's Approach to Improving Efficiency, report, May 7, 2010; Washington D.C.. (https://digital.library.unt.edu/ark:/67531/metadc302236/m1/9/: accessed May 21, 2019), University of North Texas Libraries, Digital Library, https://digital.library.unt.edu; crediting UNT Libraries Government Documents Department.