1. Example of Maryland Performance Management Neil J. Pedersen, Administrator MARYLAND STATE HIGHWAY ADMINISTRATION Fall 2008

2. Maintains a network of 16,700 lane-miles of road and 2,500 bridges. 3,200 employees at 40 facilities around the state, including seven engineering district offices and 28 maintenance shops. Quick facts about SHA

3. Our Mission at SHA is to Efficiently provide mobility for our customers through a safe, well- maintained and attractive highway system that enhances Maryland’s communities, economy and environment. Our Vision is Providing our customers with a world class highway system.

4. 1986 Total Quality Management (TQM) Focus Areas at that time were Customer Satisfaction, Participation (Participative management and Teamwork), Continuous Improvement and Measurement 1996 Continuous Quality Improvement (CQI) Focused on continually improving work processes Reinforced by the concept of CPPI Created Quality Breakthrough Teams, Quality Circles and Process Improvement Teams to review our processes and develop ways to do things smarter, faster and at a lower cost. 2002 Performance Excellence (PE) Built on a solid foundation of Quality at SHA Based on concepts from the Malcolm Baldrige Criteria for Performance Excellence Folds in Strategic Management for Public Agencies, Managing for Results, and includes concepts found in both TQM and CQI Performance Excellence Timeline

5. Combined 7 Baldrige criteria into 5 Vision Areas 1 3 45 7426 SHA Vision Areas

6. Leadership Leadership development programs –Supervisors, Managers, Advanced Leadership Program Leadership competencies –Performance appraisal pilot Employee surveys –Questions matched to performance excellence vision –Employee focus groups –Identify process improvements needed –Measure performance of managers (overall leadership skills, fair practices/equity in treating employees) 1

7. Business Planning and Performance Measurement SHA business plan –Key Performance Area (KPA) councils –Bi-weekly KPA performance reviews –Used for budgeting and resource decisions Internal office/district business plans –Link to managers’ individual performance plans –Identified common measures for districts StateStat Reviews with Governor’s Staff –Monthly meetings include performance data reports and discussions on current issues –Accountability across all state agencies 24 7

8. Internal performance excellence assessments (based on Baldrige criteria) –Use employee survey results, business plan results, external customer survey results –Three-year cycle Office/Districts process improvements and OFI’s* –Self-identified 3-year improvement plan SHA-wide process improvements and OFI’s* –Cross-functional process improvements –Employee survey vital few OFI’s* (recruitment, understanding ethical obligations) Process Improvement and Management 6 *opportunities for improvement

9. Workforce Planning and Development Business Planning – sets direction Strategic Staffing - competency needs linked to business plan key performance areas Succession Planning –Focus on maintenance and construction functions –Plans for individual critical positions SHA University –Structure accountability and funding for course delivery –Professional development plans (PDP’s) linked to curriculum Knowledge Management –Retention of knowledge linked to core capabilities (traffic engineering, materials) –Slowly evaluating virtual knowledge sharing on web 45

10. Customer Communications, Service and Satisfaction External customer survey –Areas needing improvement aligned with program funding (litter, pavement quality) Senior Management Team Strategic Planning –Data reporting (Customer Care Management System) –Resources and customer response standards –Employee recognition and communication –Website Business Plan Objectives –Overall customer satisfaction –Project satisfaction –Stakeholder/ partner satisfaction 3

11. Implement, Track & Sustain Staffed with small division Business plan bi-weekly reviews Monthly StateStat meetings Regular internal assessment cycle OFI’s tracked Vision implementation matrixes track activities Vision implementation plan (VIP) teams Ongoing focus groups with employees

12. Increased use of performance data in resource allocation and policy decision-making –Maintenance activities and operating budget –Safety (DUI Task Force) –Environmental stewardship and compliance Measurable process improvements –Reduced hiring time by about 40% –Change orders kept down to 4%; well below the 8% target –Reduced planning time for sound barrier projects by 3 months Improved reliability of delivering training classes Overall Improvement in Employee Satisfaction! Sampling of Results Achieved

13. Tightening link of business plan measures to financial measures Emphasis on data controls Linking future workforce decisions to future business needs Using process improvements to better support IT projects Cross-referencing OFI’s, processes, business plan objectives, and workforce competencies to align them Future Opportunities