Out of Control Policy Blog

Improving SBA Via Performance Assessment

The Federal Times ran an article yesterday detailing how the SBA Disaster Assistance Office has increased efficiency and improved service delivery by implementing the program performance assessment embodied in OMB's Program Assessment Rating Tool (PART):

    Managers at the Disaster Assistance Office of the Small Business Administration used to gauge their program's success by tallying the number of loan applications they received and processed each year. No more.

    Under pressure from the White House to demonstrate that the office is helping those it was created to serve, managers realigned their measuring sticks to match customers' needs, rather than their own processes. Since 2003, managers at the SBA Disaster Assistance Office have been calculating how their loans benefit disaster victims. They count the number of days it takes a small-business owner who gets a loan to fully repair his damaged property. And they hired the University of Michigan's School of Business to conduct annual customer satisfaction surveys.

    . . . .

    The change is a result of the Office of Management and Budget's results-measuring questionnaire, the Program Assessment Rating Tool (PART). PART's 25 questions ask managers to define their programs' goals, management and results.

    . . . .

    Managers said the new evaluation tool helps them manage their programs better.

    "It clearly helps us to focus on, for example, if the mission's clear, is there duplication in the process. It forces you to continually look at program efficiency. Obviously there's a big emphasis on results and measuring those results," said Herbert Mitchell, associate administrator for SBA's Disaster Assistance Office.

    To prepare for the PART evaluation, Disaster Assistance revised its goals in 2003 to focus more squarely on the program's customers – small business owners and homeowners with uninsured losses in disasters. The office measures how fast money gets to loan recipients by calculating the percentage of initial disbursements made within five days of loan closing. It looks at whether the loans help keep damaged businesses in business by calculating the percentage of businesses still operating six months after they get their loans. And it surveys its customers to gauge their satisfaction with the program.

    Mitchell said PART created a cultural change in the way managers run their programs.

    The program's new focus has made a difference. It was rated moderately effective in 2003 by OMB and effective in 2004. OMB recommended the program's funding be increased to $138 million in 2006, up from an estimated $112 million in 2005. That is a 23 percent increase, well above the generally flat budget growth most non-Defense programs are experiencing in the 2006 budget.

Read the whole thing.

Leonard Gilroy is Director of Government Reform


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