Managing Director & Senior Partner;
Chair, North America
It’s hard to think of a handoff with higher stakes or greater complexity than the transition to a new US president. The task involves an organization with 4 million employees and a budget of $3.8 trillion. And as history has shown, events rarely wait for a new administration to get up to speed. Prime example: the 2008 transition from George W. Bush to Barack Obama occurred as the global economy was in freefall.
That’s why detailed planning and smooth collaboration between the outgoing and incoming administrations are so critical. Max Stier, the founding president and CEO of the nonprofit organization Partnership for Public Service, says that while transition planning has improved over the last decade, the process is still far from perfect.
Stier sat down with Sharon Marcil, a BCG senior partner and the leader of the firm’s government practice in the Americas, to discuss the challenges inherent in a presidential transition and how that process can be improved. The following are edited excerpts from that conversation.
The transition of the US federal government is a massive undertaking. What do you see as some of the major issues?
The handoff of power, something that we learn as kids is the hallmark of our democracy, is a moment of both incredible power and vulnerability. It is powerful in the sense that it’s a representation of our democratic practice. But the transition is also a time in which we present to the world an opportunity for mischief. Sometimes the world presents that mischief even if it’s not deliberate, as in the last transition, when we had the economic meltdown. It’s vital for the handoff of power to be done in a safe, effective, and comprehensive fashion. To date, that has never really happened.
The transition from George W. Bush to President Obama was well prepared for and was actually known as one of the best transitions to date. But still, I think your view is there were many gaps. What’s your perspective on that?
The work that the Bush administration did in turning over power to the Obama team was the best that had been done ever in history. But, to be blunt, it was a low bar. In a world that’s become increasingly complex and dangerous, that low bar is a big problem.
You have a lot of issues that are presented. You’ve got 4 million civilian or military personnel in the government that are career employees and then you have 4,000 political appointees that sit on top and run the various organizations in government. Those appointees all turn over in a transition. And because you have to put nearly 1,100 of those 4,000 through a confirmation process by the Senate, what that means is that the new team coming in not only has to identify great people, put together good teams, and do that in a very short time cycle, but they also have to persuade the Senate to allow those people through and into jobs.
You have literally hundreds of different organizations that have to be understood and operated by the new team coming in. And you have budgets that are coming at you fast and furious.
You mentioned that managing the transition is about putting great people in the most important positions, but you’ve also noted that it’s not only that. There’s a series of activities that have to go on beyond the people piece. Can you describe some of those activities?
You have, in essence, your due diligence process to understand what exactly is going on in the various different agencies. There are time-sensitive issues that are going to present to the new team that have to be understood. A good example is that the Obama team came in at the same time in which the transition from analog to digital TV was taking place. So the new Obama administration needed to understand that issue. The last thing they needed was hundreds of millions of Americans not getting their TV—but realistically that was a real issue.
Multiply that by a thousand and you’ve got some sense of the scale and set of issues that a new team coming in today will have to face. Some of those are predictable. A lot of them are not. The Obama administration came in with a lot of big plans and virtually none of it had to do with the economy. But obviously that became front and center. Not by choice, but by the world throwing that curve ball at them.
The Partnership’s been critical in terms of passing some legislation that is going to improve the transition process. Can you describe that?
We’ve been successful now in getting three primary pieces of legislation passed regarding the transition. The first was passed in 2010, and it did something in one sense very simple but also very powerful. It moved the date of support for transition planning from what had historically been the day after the election to the convention. This is when the president-elect gets support from the government to actually engage in transition work. The goal was really to lengthen the runway for campaigns to actually focus on transitions longer than historically had been done.
The second piece of legislation, which was passed in 2012, reduced the number of Senate confirmed positions. As I mentioned earlier, one of the big obstacles for any incoming team is the difficulty of getting their core people through the Senate. This legislation essentially reduced that number by about 10%.
The last piece of legislation was passed in March of this year. It focused on the responsibilities of the outgoing administration to make for an orderly handoff to the new folks coming in. It provides for a lot of very common-sense, but very important, activities that the outgoing administration needs to do to help the incoming administration.
Today is a period of particular divisiveness in politics. Do you think that will in any way hinder or influence the transition? Or not necessarily?
What’s amazing about this area is that we have found incredible goodwill, even in that challenging partisan atmosphere. We have for three cycles now brought the relevant parties together in the midst of the campaigns to talk about and to help them prepare adequately for the transition. This last go around, when we brought folks together in April, we had five campaigns—Cruz, Kasich, Trump, Clinton, and Sanders—with folks from the Obama White House, with people from the Romney readiness team, and Bush alums. All were in one room for a day and a half and it was incredibly collaborative and constructive.
Max, thank you so much for everything that you and the Partnership are doing to make the transition successful. I know it’s going to pay great dividends in terms of the governing of the United States.
We couldn’t be doing what we are doing without BCG’s help. It means a lot. So, thank you.
At a Glance
Born in Torrance, California
Year born: 1965
1987, BA, Yale University
1992, JD, Stanford Law School
2001–present, founding president and CEO, Partnership for Public Service
1999–2001, deputy general counsel, US Department of Housing and Urban Development
1995–1999, attorney, Williams & Connolly
1994–1995, clerk for Justice David Souter, US Supreme Court
1994–1995, special litigation counsel, US Department of Justice