and draw a full paycheck while they receive their retirement annuity. Prior to the legislation, returning workers could only work nine months of the year and had their salary capped at $60,000. With the elimination of those caps, the state hopes to bring back some of its brain trust.

In Iowa, the departure of workers with special skills has driven up the need to outsource services. "In particular, we have increased our reliance on outside contractors in the IT arena," said Anderson. "We discovered in the last year we spent $483 million on outside contractors, a large portion of which went toward technical support contracts."

Like Texas, Iowa found that its pay scale for technology workers and other skilled labor lagged behind the private sector. So the state created a new compensation and classification system that mirrored the private sector.

Succession Planning

One workforce strategy that is drawing increased attention in the public sector is succession planning. Once considered a tool mainly for finding managerial replacements in the private sector, the practice is beginning to draw attention in government. No firm figures exist on how many state or local governments are beginning to practice succession planning, but the term is popping up more and more in government personnel departments and elsewhere.

The Texas state Legislature, in addition to changing the rules under which retired workers can return to a public sector job, also added a clause to the law calling on every state agency to develop a workforce plan to address critical staffing and training needs, including the need for experienced workers to impart knowledge to their eventual successors. "What the state is saying is that we have a potentially serious problem and lets get cranking on it," said Robinson.

In the past, succession planning was a highly subjective effort, often involving small groups of people who tried to pick the right individual for a specific leadership job. "Succession planning was usually something that was done on the back of an envelope," said Marcia Jones, senior vice president of product strategy for Peopleclick, a human resource software firm.

But todays leadership positions are more demanding and fewer people have had the training or on-the-job experiences to prepare them for senior-level positions. As a result, succession planning has become much more organized and is usually an ongoing effort to determine what sort of competencies are needed to fill a position, where leadership potential lies and how to assess an individuals specific strengths and weaknesses.

In Washington, the states Department of Personnel has recommended that agencies use succession planning as a way to prepare a pool of qualified candidates to meet future workforce needs and to provide an avenue for long-term employees to pass on accumulated knowledge. Iowa has launched a succession planning pilot project to identify the type of competencies the state expects from its future workforce, as well as what kinds of skills will be required of managers and to begin offering training programs to bring future managers up to the competency level the state expects.

But as Anderson pointed out, job promotion in state government is merit-based. "We cant identify somebody and say, We are going to develop you as a manager in the future," she said. "What we need to do is make sure we provide opportunities for all employees for career development, and then identify training programs that address what competencies we need and document the people who have been through the program and have performed well. Then, on that basis, give them the opportunity to apply for the managerial position."

Software Solutions

Even if bureaucracy limits some of its impact, succession planning still has its place in government and human resource agencies can take advantage of new tools to help with the process. A

Tod Newcombe  |  Features Editor