The Baldrige Budget — Just the Facts

Posted by Harry Hertz, the Baldrige Cheermudgeon

When I was growing up a regular activity in our household was to tune the television each week to Dragnet, a police show that was reprised as a movie in the late 1980’s. The most memorable and debated line from the weekly show was Sergeant Friday’s: “Just the facts ma’am.” So let me share “just the facts” with you about the proposed Budgetbudget for NIST’s Baldrige program in these tough budgetary times.

The government is currently approaching the midpoint of fiscal year 2011. We are operating under a continuing resolution (CR) that allows us to spend at the prior fiscal year level. This continuing resolution expires in early March. The House of Representatives has just introduced an appropriations bill that would continue the funding for the federal government through the remainder of the fiscal year, but at lower levels government-wide than the current CR. This process is ongoing and requires agreement between the House and Senate as well as the President’s signature before a new funding level is established for the rest of 2011.

This past Monday, the President submitted his budget proposal for the coming fiscal year (2012) to Congress. This budget request proposes to fund the Baldrige program at $7.7 million, a decrease of $1.9 million from our 2010 approved budget. The Administration has directed each agency to analyze its administrative costs and identify areas of savings where possible, and operating at this proposed level is consistent with this guidance.

With the requested 2012 funding, Baldrige will continue to develop criteria, disseminate best practices and continue the award process. However, we are also beginning to evaluate alternative sources of funding and alternative cost models for the program, with our private-sector partners sharing more of the costs going forward. The Baldrige program already operates as a partnership with the private sector, consistent with the law that established the program in 1987. This budget proposal aims to expand these partnerships and to maintain and grow the program’s reach and high level of service and value while exploring ways of transitioning out of federal funding. As with the fiscal year 2011 CR, the full Congress must approve the 2012 budget, followed by approval by the President.

Neither the Baldrige program’s current award cycle nor its scope for the future is affected by the President’s 2012 budget proposal.  These are challenging times for all, and with your help, we will rise to the occasion.


About Barbara Fischer

NIST Baldrige
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17 Responses to The Baldrige Budget — Just the Facts

  1. Judy E. Schwartz, MD says:

    I appreciate hearing the facts. I had heard that the recommendation was to eliminate the Baldrige program. Having seen the quality, patient satisfaction, and financial results from applying the Baldrige criteria; I thought such a move would be untimely. I think the criteria provide a road map to meet the health care reform goals of improving healthcare quality and patient satisfaction while reducing the cost.

  2. Steve Randol says:

    Glad to hear the facts. Hows does the way MBNQA program is funded in the US compare with other national award/excellence programs? With the Administration’s emphaisis on creating (especially manufacturing) jobs, it seems that eliminating ours would take away one of the factors being used in other countries to take jobs out of the US.

  3. Midge Duncan says:

    Cutting the Baldrige budeget in light of the recent order establishing the Council on Jobs and Competitiveness seems contradictory on the surface. Can someone shed any light on whether these two programs have any linkage and support for each other? Thanks.

  4. Michelle Boylan says:

    The facts are so important. Thank you. The Baldridge Performance Excellence model is a strength in the challenging times. I would hypothize that alignment around the model can actually produce both hard and soft dollar savings for organizations. Living in the healthcare sector, Baldrige Performance Excellence should proably move to the requlatory requirement side since healthcare is slow to change to meet the value requirements for its customer base(internal and external).

  5. Ken Harmon says:

    Thanks for the facts. I have always thought that the Baldrige program provides a great system for achieving performance excellence, and the wide variety of organizations which have been recognized shows that the model works. We need more support for the program, not less. And it wouldn’t hurt if the President would show up at the awrds ceremony. If memory serves the last time that happened was when Chugach Schools won, among others.

  6. Sam Turner says:

    This only proves that in the absence of information, others will use their interpretations and fill the vacuum. Communication by senior leaders is critical to organizational success and I am glad that you have taken the time to explain the facts as well as alternatives currently being explored.

  7. Bob Horst says:

    I suspect the Baldrige program, like charities, can go forward with a 20% reduction in funds by slashing travel and non-mandated expenses by those charged with fulfilling the mission.

  8. The facts that Harry gave us are clear. A sudden 25% reduction in a budget is tantamount to panic and despair. I applaud the people at the BPEP for their long term vision and adaptability in those challenging times.
    I fully agree to transitioning from the feds. One alternative is to tap the healthcare sector. We all saw in the last few award cycles, the continuous rise in healthcare applicants (up to 50%) vs.other industries. Most healthcare systems are non-profit and still have a lot of room for budgeting & improving their quality indicators. As a physician dealing with healthcare quality and healthcare PIs,I do not want to venture into the regulatory side of the healthcare industry as it is teeming with layers of fed/state/private regulators, but I always thought of the Baldrige model as a great wholesome tool to utilize in the healthcare arena because of its proven record and adaptability to each and every heathcare system. This idea should be further studied and possibly marketed and I assure you that many healthcare leaders would be very supportive and will adopt it.

  9. Mark Williams says:

    Well, with respect, a federal program that traffics in organizational best practices should probably be able to manage a 20 percent budget reduction–I would guess that the majority of the firms which practice Baldrige have had to do at least the same.
    The larger issue, and what should probably be more of a red flag for backers of this program, is the recommendation by the Deficit Reduction Task Force that the Baldrige program be terminated. Clearly, at the minimum, this recommendation indicates a failure by this program to effectively communicate the value that Baldrige may be bringing to American business competiveness and to process improvement.
    I’ve always found it absurd that the Baldrige program resides in the bowels of NIST, and hence is subject to the culture and staffing of what for most Americans would be an obscure and featureless bureaucracy. I would guess that this may be one of the reasons for why the Deficit Reduction Task Force would recommend this program’s termination.
    In thinking about how to re-structure the funding for Baldrige, it may also be a good idea for thinking about how to re-structure the overall profile for Baldrige within American business. For me, this program should be considerably higher profile than it has been in the past, and should certainly be run in a way that makes Baldrige an essential play for ALL ambitious American managers, not only for healthcare.
    All in all, the time may be fortuitous for a change in program leadership to someone who is much more marketing savvy, is a nationally-recognized business leader rather than a long time government employee, and who would be tasked with dramatically broadening the presence of Baldrige within American business–especially finance, manufacturing and information sectors.

  10. William Sacherek says:

    The Baldrige Program can better position itself as a “performance improvement” effort as opposed to the perception that it is an award for applicants. I have participated in Baldrige and been an observer as well and there needs to be more of an educational effort on all our parts to get groups to reap the benefit of participation in the program. Only when really dollars are saved and enhanced value achieved among entrenched bureaucratic business, government and NGOs will Baldrige realize its’ potential to undergird real progress in our nations’ progress.

  11. Ron Kegarise says:

    Thanks for sharing the facts as they stand today.
    I have often wondered why administrations don’t use the criteria more frequently to clean up their act but guess no one wants to subtract anymore…just add!
    What can I do to help?
    Ron Kegarise

  12. Harry, thank you for your clarification. I, too, had heard rumblings about abolishing the Baldrige Program. It’s great to know that Baldrige will be moving forward.

  13. Richard Covert MD, MPH says:

    I appreciate the brief update. What a shame that the rest of the gov’t doesn’t utilize this key asset to its best use. It could learn much from the Baldrige program. It might be a fortuitous opportunity to seek shelter in another setting apart from the Federal bureaucracy, one that understands the value of the program and all it offers to business and social organizations, alike.

  14. Mike Frihart says:

    I work for a previous Baldrige Award recipient, and am intimately familiar with the dedication required for any organization to be worthy of the Award. It is truly unfortunate that the act establishing the Baldrige program did not require its application to the processes of the federal government. Based on the benefits and results that my company continues to reap from the engrained mindset of continuous improvement and customer focus, there would be little need for across the board budget cuts.

  15. Merlin J. Ricklefs says:

    Harry, thank you for being a role model and sharing the facts in a timely way to those with a need to know. I started this as a brief comment to your blog note, but it wouldn’t accept it, so I am sending it as this personal note which has expanded extensively.
    It is unfortunate that our government leaders don’t understand the process and its potential for organizational transformation for business, healthcare and education. It is my observation from personal experience that the Baldrige Criteria and Process is the most comprehensive and effective performance improvement process in the world. My experience includes leading and advising the application of the Baldrige process in business (IBM won in 1990), assisting with the adaptation of the process to Education, teaching and applying the process at colleges and universities across the U.S. and in Asia, and helping the Thai Ministry of Commerce establish the Thai National Quality Award based on the Baldrige.
    I have seen significant evidence from experience and data that the Baldrige was a major driver behind our national economic recovery in the 1990’s. It was the major catalyst that directly and indirectly motivated and taught U.S. organizations to share best practices and to effectively guide extensive process and organizational transformation with the introduction of personal computer technology and distributed processing. The world had the same access to PC’s and distributed processing technology but the U.S. was able to implement and leverage faster, more creatively and more effectively. Leadership commitment to the process was a major factor in getting us off a slippery slop to nowhere and onto becoming the #1 economic power of the world. I see little evidence that we have the same leadership commitment today but there is significant evidence that we are back onto the slippery slope.
    We always hate to see our budgets cut, and I can not speak for the Baldrige budget needs, but I can observe that the program really needs national leadership COMMITMENT (not just support). At the moment that leader is president Obama along with his cabinet the Administration and multitude of CZARS (I think there are now 40). We need our national leadership to direct the application of the process and its principles into our National Administration top down to achieve improvement from the bottom up. I am not sure we need another CZAR – maybe we do? – but most importantly we need the president presenting the award, implementing the process through his administration, and the media making a “big deal” out of it. That probably is a lot of hard work and doesn’t necessarily need to cost a lot of money, but it does have the potential of saving and restoring our nation!
    My sincere recommendation is that you personally carry this message to the president, make the case and obtain his COMMITMENT. Then, I expect the budget will take care of itself — for business we say focus on Total Enterprise Quality and the profit and revenue will follow. I think your leverage is that you have the data to make the case and elections are coming soon. Maybe you should be the next CZAR – they seem to have money!
    I am not a Social Media expert but we are all observing how it is being used to organize people and affect government leadership in the Middle East – and Madison WI. Does your staff have the expertise to lead a positive movement to obtain our president’s COMMITMENT, implementation within the Administration and extensive media publicity?

  16. Harry Hertz says:

    Thank you to everyone for your comments and your support of the Baldrige Program.I always believe that having facts allows intelligent debate and discussion.

  17. Parlin says:

    This is a great article and I’d like to make a sogsegtiun to all who read this piece .specifically, as consumers with an understanding of matters such as these, we need to inform the organizations of the disconnects.Naturally, that puts a burden on us to be the news-carrier .but, it does make a difference in many cases.I sit on the Board of a local non-profit. They’ve struggled with retention of donors and event participants. As we discussed this issue, it became apparent that they were creating many of their own challenges. Thankfully, the local staff has been willing to listen to why some of their current best practices aren’t very helpful.

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