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5:00 PM
Special Meeting
Wednesday, March 6, 2013
Council Conference Room
Call to Order
Oral Communications
Agenda Items
1. Discussion and Recommendation to the City Council to Amend the
Contract with Sherry Lund Associates to Exercise an Option to Extend
for One Year for a Total Cost Not to Exceed $46,850 for 1) Consulting
Services related to the 2012-2013 Annual Performance Reviews for Four
Council Appointed Officers for a Total Cost Not to Exceed $32,300, 2)
Solicitation of Staff Feedback Related to Performance Evaluations for a
Total Cost Not to Exceed $7,000, and 3) Mid-year Performance Review
Updates for a Total Cost Not to Exceed $7,550.
Adjournment
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CITY OF PALO ALTO OFFICE OF THE CITY CLERK
March 6, 2013
The Honorable City Council
Palo Alto, California
Discussion and Recommendation to the City Council to Amend the
Contract with Sherry Lund Associates to Exercise an Option to Extend
for One Year for a Total Cost Not to Exceed $46,850 for 1) Consulting
Services related to the 2012-2013 Annual Performance Reviews for
Four Council Appointed Officers for a Total Cost Not to Exceed
$32,300, 2) Solicitation of Staff Feedback Related to Performance
Evaluations for a Total Cost Not to Exceed $7,000, and 3) Mid-year
Performance Review Updates for a Total Cost Not to Exceed $7,550.
Attached is the proposal by Sherry Lund Associates for the; 1) 2012-2013
Annual CAO Performance Review Cycle, for a Total Cost Not to Exceed
$32,300, 2) Staff Feedback, for a Total Cost Not to Exceed $7,000, and 3)
Mid-year Performance Review Update, for a Total Cost Not to Exceed
$7,550. Total Contract Cost of $46,850.
ATTACHMENTS:
Lund Cover Letter to CAO Committee (DOCX)
CAO Annual Evaluation Process 2012-13 (DOCX)
Lund CAO Staff Feedback (DOCX)
Lund CAO Mid-year Update Discussions (DOCX)
Department Head: Donna Grider, City Clerk
Page 2
247 La Cuesta Drive
Portola Valley, CA 94028
(650) 619-5500 fax (650) 561-8414
sherrylund@aol.com
February 25, 2013
Mayor Greg Scharff
Chairperson, Council/CAO Committee
City of Palo Alto City Council
250 Hamilton Avenue
Palo Alto, CA 94301
Dear Mayor Scharff--
I am attaching three proposals for the CAO annual performance management process. I am
submitting these separately to allow the CAO Committee and/or Council to consider each
component without delaying decisions on the others. I would highlight the following changes:
This year, the annual evaluation proposal reflects a 5% increase, for the first time in the
last 5 years of consulting on that process. There is also up to 10 hours or $2,500 included
this year for compensation-related work and meetings that may be required. The only
change to the process itself is the collection of feedback through interviews rather than
questionnaires. This change proved to be more efficient and effective for the final two
reviews last year.
The staff feedback component was included for the first time last year. There is an
addition of up to 4 hours or $1,000 for any follow-up work that may be required.
The mid-year update discussions cost remains the same.
Please let me know if there is additional information I can provide. I will be attending the CAO
meeting on March 6 to respond to any questions from the CAO Committee.
Thank you for your assistance and best regards,
Sherry Lund
Principal
247 La Cuesta Drive
Portola Valley, CA 94028
(650) 619-5500 fax (650) 561-8414
sherrylund@aol.com
February 23, 2013
Mayor Greg Scharff
Chairperson, Council/CAO Committee
City of Palo Alto City Council
250 Hamilton Avenue
Palo Alto, CA 94301
Dear Mayor Scharff:
Following is a proposal for the annual CAO performance review process. It includes the
project description, timeline, benefits, project phases, tasks and consultant responsibilities,
client responsibilities, project cost and assumptions, consultant qualifications, and next steps for
the Council’s consideration. I am submitting separate proposals for gathering input from CAO
staff members and mid-year performance update discussions for ease of Council’s consideration
of each individual component of Council’s performance management process.
Project Description
The four CAOs control the major financial and human resources in executing the Council’s
vision and priorities. Performance evaluation is an important opportunity for CAOs to get
Council’s unified feedback on the past year. More importantly, it is the only opportunity to get
unified feedback about expectations of performance going forward. Focus, clarity and
alignment are critical to deploying financial and human capital efficiently and effectively;
they are particularly critical when resources are limited.
At the end of FY 2012-2013, the City Council will be evaluating the performance of four
Council Appointed Officers (CAOs). I propose a similar evaluation process to that used in
FY 2011-2012, with one change. That is to collect all Council feedback through interviews.
Doing so has proven to be a more time-efficient method and requires less follow-up than
written questionnaires.
Timeline
Last year, Council considered alternate timeframes for conducting annual CAO performance
reviews and concluded that they wish to keep the review process on the same schedule. This
means that the process would be completed by the end of July, or before the Council goes on
Sherry L. Lund Associates Proposal: 2012-2013 CAO Annual Review Process Page 2
its annual meeting break. I suggest that, to make the process as easy on Council as possible
during a busy time, the work kicks off in early to mid-May. Starting then means that a
contract would need to be initiated by mid-April.
Benefits
The primary benefits I bring to the process are as follows:
1. The ability to leverage Council’s time to best use. Council has a exceptionally heavy
work load with major budgetary and other issues in front of you.
2. Knowledge of your Council objectives, your unique City culture, your CAOs,
plus technical expertise in executive evaluation and work with Councils and Boards.
3. The ability to be efficient in helping Council deliver a quality process and
outcomes.
4. Assurance of a safe, professional, and mutually respectful environment for review
discussions/feedback. I serve as an advocate for all points of view being heard within
a professional and respectful environment.
I can work flexibly with you to make any changes in the process that you may desire within
the framework of maintaining a quality process.
Project Phases, Tasks, and Consultant Responsibilities
In addition to the specific project steps listed below, I, as Consultant, prepare for all meetings
and communications; serve as project manager; and assure a sound methodology for the review
process as a whole. The following performance evaluation project steps correspond to the last
three years’ process:
Phase I – Preparation for Review Session
In this phase, Consultant:
Works with internal liaison to schedule project meetings and milestones.
Solicits CAO self-evaluations, reviews them and provides feedback and advice.
Works with CAOs and Council, as needed, to refine performance measures.
Assures CAO questions are clarified and raised with Council.
Prepares and distributes binders to Council, including instructions, CAO self-
evaluations, blank evaluation, and, if elected, staff feedback summary in hard
copy. Distributes soft copies of forms on the same day.
Meets with each Council member by phone or in person to collect evaluation
feedback on each CAO.
Compiles written comments and numerical feedback from Council and develops a
written evaluation summary for each CAO. Prepares and sends confidential soft
copy and hard copy packet and with this information prior to each CAO review
session.
Prepares information for closed review sessions which enables Councilmembers to
focus their discussion efficiently.
Sherry L. Lund Associates Proposal: 2012-2013 CAO Annual Review Process Page 3
Phase II – Performance Review Session
In this phase, Consultant:
Provides facilitation and technical assistance during closed session Council
performance review meetings, and performance goal-setting with each CAO.
Documents agreed-upon unified Council feedback for written reviews and goals.
Phase III - Post-Session Wrap-Up
In this phase, Consultant:
Meets with CAOs to debrief evaluation meetings.
Prepares final evaluation file copies and obtains necessary signatures. Copies are
given to CAO Committee Chair for filing and to each individual CAO. Final
action on Council agenda is scheduled with City Liaison.
As needed, meets with CAO Chair and/or Committee members to get additional
feedback and/or refine future process.
Phase IV - Compensation Analysis, Discussions and Potential Action
Timing of compensation discussions in the process is driven by CAO and Council
schedules. These discussions may either occur between Phase II and III or after Phase III.
In this phase, Consultant:
Provides guidance and format to City HR staff member, who collect competitive
compensation data and formats it as requested by Consultant.
Analyzes results and works with CAO Chair to prepare for closed session
discussions.
Documents decisions. CAO Chair works with internal staff to agendize
compensation items for Council meetings and to prepare any resulting changes in
contracts.
Performs any other task required.
Client Responsibilities
In order to support the success of the project, Client agrees to:
Assure involved parties a) are available for one-on-one and group meetings; and b)
complete evaluations on time in order to meet project milestones.
Identify an internal liaison that can schedule appointments and provide support in
getting evaluation items on Council agendas.
Provide meeting space and A-V equipment required.
Commit to a professional and respectful process.
Sherry L. Lund Associates Proposal: 2012-2013 CAO Annual Review Process Page 4
Project Cost and Assumptions
Annual Evaluation Cycle - The CAO annual evaluation process can be completed for a
project fee not to exceed $ 32,300.00, which includes expenses and includes the following:
o $ 27,300.00 - $ 29,800.00 - Annual evaluations for the four CAOs. The higher
number in the range includes up to 10 hours or $ 2,500 for possible client-driven
additional services. These may include meetings cancelled without notice;
additional work or re-work resulting from Council or City staff not performing
their responsibilities in a timely fashion; and meeting client requests for out of
scope services.
o Up to 10 hours or $ 2,500.00 estimated for compensation-related work.
Additional work required would be billed at $250/hour.
This quotation is based on the work as previously described and cannot be unbundled
without re-quotation.
Options for gathering feedback from the CAO Direct Reports and for Mid-Year Check-In
Discussions are addressed in separate proposals in order to facilitate Council’s individual
consideration of each component.
Cost Assumptions - The following assumptions have been considered in pricing this proposal:
There will be compensation analysis and discussion work required this year.
Competitive data will be gathered and formatted by City HR staff, with Consultant
specifying what is needed.
Meetings missed without 24 hours notice and re-work that is caused by the Council
or City employees missing meetings and deadlines will be billed beyond the
quoted project fee at discounted public sector rate of $250/hr. (private sector rate is
$375/hr.).
Consultant Qualifications:
I believe my skills and experience remain a good match for this work, as I offer:
Five years of continuity in working with the City of Palo Alto Council and CAOs
on performance management. An insider’s understanding of City culture and citizen
expectations with the outsider’s ability to be fully objective about the process and
relationships.
Deep and broad experience in performance management (including executive
evaluation), executive coaching, negotiation, interpersonal communication,
rewards and recognition, and career development – all important components of
this project.
Sherry L. Lund Associates Proposal: 2012-2013 CAO Annual Review Process Page 5
Thirty-five years experience in organizational consulting--with twenty-three years
consulting experience in my own firm—for a broad variety of organizations in the
public and private sector:
o Public sector/non-profit experience examples include: Cities of Fremont, Santa
Rosa, Dublin, San Ramon, Sausalito, Sonoma, Mission Viejo, Tracy, Fairfield,
Union City, CA; plus the City of Tualatin, OR; Counties of Santa Clara, San
Mateo, Alameda and Riverside, CA; BAAQMD, Sonoma County WMA,
Carnegie Mellon University (Provost), the Dr. Susan Love Research Foundation,
the Council on Foundations, S. H. Cowell Foundation, and the University of
California.
o Global private sector examples include: Intel, HP, Acco Brands, Cisco Systems,
Seagate, The Gap, Levi Strauss, Driscoll’s, Xoma, Genelabs, among many others.
This broad experience allows me to collect best practices from many sources and to
avoid getting locked into the paradigms and traditions of a single type of organization.
Next Steps
Upon acceptance of this proposal by the CAO Committee and Council, the next steps are to:
1. Execute a contract per your internal procedure.
2. Develop a project schedule that is based on availability of all parties; revise it, as
necessary, with Council at the earliest meeting possible. Please note that a schedule
cannot be confirmed until the contracting process is complete.
I would be very pleased to work with the Council and the CAOs again on the annual review
process. Please let me know if I may provide additional information.
Best regards,
Sherry Lund
Principal
247 La Cuesta Drive
Portola Valley, CA 94028
(650) 619-5500 fax (650) 561-8414
sherrylund@aol.com
February 23, 2013
Mayor Greg Scharff
Chairperson, Council/CAO Committee
City of Palo Alto City Council
250 Hamilton Avenue
Palo Alto, CA 94301
Dear Mayor Scharff:
As part of my proposal for the CAO annual performance review process, I’m including a
separate cost quotation for gathering feedback from staff members. The purpose of this
additional component is to provide better input to the internal leadership portion of the
performance review. I am submitting separate proposals for the annual review cycle and mid-
year performance update discussions for ease of Council’s consideration of each individual
component of Council’s performance management process.
Project Context
City Councils hold CAOs accountable for staff leadership, yet Councilmembers often feel they
do not have enough balanced contact with staff members to assess this factor. Council members
are usually able to directly observe CAO interaction with members of the public, other
community stakeholders, and members of governmental agencies. The one aspect of
performance that they rarely have the opportunity to directly observe or assess is staff leadership.
Often impressions of leadership are formed based on occasional casual conversations that may
not be at all representative of the collective staff’s views.
Councils do not generally need deep and detailed information. They need to have enough
balanced feedback to conclude that leadership is solid, that there are early signs of a potential
problem that merits a mention, or that there is a clear problem that requires an action plan or
intervention. Councils typically don’t engage in offering detailed leadership advice to their
CAOs, but they may direct an individual to address an issue or pattern of issues,and/ or to seek
outside assistance.
Project Methodology
Sherry L. Lund Associates Proposal: 2012-2013 CAO Staff Feedback Option Page 2
Choosing a methodology to get feedback from the staff level is critical to achieve a quality
outcome. Whatever methodology is used needs to include a well-executed process, careful
question construction, the ability to verify the accuracy of the messages in context, and useful
results. To do otherwise leads to poor outcomes and legal risk.
One of the simplest and most inexpensive ways to gather feedback is through a written survey.
However, there is a great deal of potential for abuse in gathering multi-rater feedback through
written survey questions alone. Some of the more problematic aspects are:
There is no interpretive context for comments, e.g., whether feedback from an individual
is merited or is vindictive and personal.
If responses are unclear, too general, or don’t provide examples, there is no opportunity
to ask follow-up questions.
Written feedback alone is more reliable in an organization with a history and culture of
giving and receiving performance feedback across all levels. People who know that they
will both be givers and receivers of feedback tend to use feedback constructively rather
than to punish.
Conducting interviews overcomes most of the disadvantages of written surveys. An experienced
interviewer can assess the context of comments, e.g.:
Is feedback coming from a staff member who is on a performance plan himself/herself?
Is the CAO striking the right balance of leadership while executing Council’s vision for
change? E.g., is the leader advancing change, dealing with collective bargaining, reorgani-
zing staff and processes to achieve efficiencies/effectiveness)? CAOs are delivering a lot of
difficult news in today’s economic climate, but skilled leaders manage to find the right
balance and speed of change while maintaining the respect of their teams and stakeholders.
Are the staff member’s expectations reasonable, compared to other organizations and
generally accepted good leadership behavior?
Clearly, conducting interviews is a better solution from a methodology perspective. However,
the logistics of interviewing approximately 30 direct reports for the four CAOs becomes a heavy,
cumbersome, and expensive process.
Therefore, I am proposing the process used last year that combines both written survey
feedback and some interviewing to achieve a result that maintains the integrity of the
process while balancing time and cost factors.
Project Steps
I propose the following process, as described in the steps below:
Sherry L. Lund Associates Proposal: 2012-2013 CAO Staff Feedback Option Page 3
Step 1: During each CAO’s staff meeting, I introduce myself, the purpose for
soliciting feedback, and the process.
Step 2: One-on-one with each CAO, I listen to the CAO’s perspective and weigh that
as I consider context. As part of my regular meetings with CAOs to kick off the annual
evaluation process, I now talk with them about context that they feel I should be aware of
(from their perspective). I can simply expand that discussion at no added cost.
Step 3: I ask staff members to respond in writing to 4-6 targeted questions that
require comments. Comments, not ratings, are required to formulate a clear plan for
change. Responses are submitted to me with names attached, so that I am able to follow
up with questions. However, all feedback reported to Council and CAOs is anonymous.
Step 4: I read comments and follow up with brief phone interviews. In these
interviews, I probe more deeply, fleshing out examples and testing assumptions to
validate messages and themes.
Step 5: I summarize final feedback and include it in Council’s feedback package.
Step 6: Follow-up consulting as needed.
Timeline
This process would be started at the front end of the annual review process (May-June) in order
to seamlessly integrate it into the annual CAO review process.
Cost
This project can be completed for a project price of $ 7,000. That total includes Steps 1-5 for
$6,000, plus for Step 6 (follow-up consulting), up to 4 hours or $1,000. All expenses are
included. This quotation represents consideration for volume pricing as an add-on to the
annual evaluation process. Please note that price quoted is a package price for all 4 CAOs as
described above and cannot be unbundled without re-quoting.
Next Steps
Upon acceptance of this proposal by the CAO Committee and Council, the next steps are to:
1. Execute a contract per your internal procedure.
2. Develop a project schedule, based on availability of all parties; revise it, as necessary,
with Council at the earliest meeting possible. Please note that a schedule cannot be
confirmed until the contracting process is complete.
It would be a pleasure to work with the Council and the CAOs on this component of the CAO
review process. I would be happy to provide whatever additional information you may need.
Sherry L. Lund Associates Proposal: 2012-2013 CAO Staff Feedback Option Page 4
Best regards,
Sherry Lund
Principal
247 La Cuesta Drive
Portola Valley, CA 94028
(650) 619-5500 fax (650) 561-8414
sherrylund@aol.com
February 23, 2013
Mayor Greg Scharff
Chairperson, Council/CAO Committee
City of Palo Alto City Council
250 Hamilton Avenue
Palo Alto, CA 94301
Dear Mayor Scharff:
Following is a proposal for 2012-2013 mid-year CAO performance review updates for
consideration by the CAO Committee and City Council. I am submitting separate
proposals for the annual review cycle and for gathering input from CAO staff members for
ease of Council’s consideration of each individual component of Council’s performance
management process.
Project Description
When an employee reports to a single manager, performance dialogue typically happens
throughout the course of normal work and one-on-one meetings. When an employee
reports to a group, these same opportunities do not exist. CAOs may have frequent
conversations with individual Council members, but rarely have the opportunity to get
unified feedback from their collective bosses.
CAOs manage significant human and financial resources in the City. In a highly
dynamic environment with nine bosses, a year is a long time to go between performance
dialogue. Mid-year check-in discussions allow for course correction, reprioritization,
and early intervention so that performance is actively managed and resources are
correctly deployed. While Council has the opportunity to give feedback to CAOs, CAOs
also have the opportunity to raise questions and check assumptions that help guide their
performance for the rest of the year. The process itself is simpler and more streamlined
than the annual performance review process.
During 2012-2013, you would like to schedule mid-year check-in review discussions
for the City Manager, City Attorney, City Auditor, and City Clerk (the latter is an
addition this year).
Sherry L. Lund Associates Proposal: 2012-2013 CAO Midyear Updates Page 2
Timeline
Preparation work for this project would begin in November, with discussions held in
December, 2013.
Project Steps and Consultant Responsibilities
Step 1: Advance Preparation for Discussions
Advance preparation allows both Council and CAOs to use group time effectively
and efficiently. To prepare, I do the following:
Interview each Council member individually for 45-60 minutes to gather
update feedback on the four CAOs. The key questions are:
o Do you feel this CAO is on track with the goals and objectives?
o Are there any changes/course corrections you would like to make in
your expectations or the CAO’s performance?
o Is there any other feedback you would like to provide?
Interview each CAO (30 minutes each) to see if there are questions or issues
that they would like to raise with the Council. Examples may include getting
clarity on performance goals and priorities,
Summarize Council feedback and CAO questions and prepare agendas and
materials for closed sessions—all of which support an efficient and effective
discussion.
Step 2: Closed Session Performance Check-in Discussions
The discussions are a simpler version of the annual review, but the discussion format
is generally the same. I do the following:
Meet with Council in closed session to agree on update feedback, then bring
in each CAO individually for feedback and discussion.
Provide facilitation and technical assistance as needed during the discussions.
Based on the differing scope of responsibilities and number of direct reports, I
suggest allocating closed session time as follows: two hours for the City Manager;
one and one-half hours for the City Attorney; one and one-half hours for the City
Auditor; and one hour for the City Clerk.
Step 3: Post-Session Wrap-Up
Sherry L. Lund Associates Proposal: 2012-2013 CAO Midyear Updates Page 3
Upon completion of the closed session discussions, I do the following:
Document agreed-upon Council feedback.
Answer follow-up questions with CAOs.
Use feedback from Council and CAOs about how the process worked to refine
it for the future.
Due to the highly confidential nature of this assignment, I personally perform all work on
this contract.
Client Responsibilities
In order to support the success of the project, Client agrees to:
Assure involved parties are available for one-on-one and group meetings.
Identify an internal liaison that can schedule appointments and schedule closed
sessions.
Provide meeting space and A-V equipment required.
Commit to a professional and respectful process.
Project Cost
This project can be completed for a project fee of $7,550.00 which includes expenses --
$ 6,550 for the City Manager, City Attorney, City Auditor and $ 1,000 for the addition of
the City Clerk this year. This quotation is offered based on economies of scale for at
least three CAOs, and cannot be unbundled without re-quotation.
Meetings missed without 24 hours notice and re-work that result from missed meetings and
deadlines will be billed beyond the quoted project fee at discounted public sector rate of
$250/hr. (private sector rate is $375/hr.).
Next Steps
Upon acceptance of this proposal, the next steps is to execute a contract per the City’s
internal procedure.
I would be pleased to help you implement this next refinement of the CAO performance
review process. Please let me know if I may provide additional information.
Sincerely,
Sherry Lund
Principal