With the appointment of Bob McDonald as the new head of the Department of Veterans Affairs, President Obama is going against the trend of past appointments of VA secretaries, which have largely been filled by retired military generals, medical professionals, and politicians, not retired corporate executives.
McDonald, the former CEO of Procter & Gamble and a West Point grad, would be tasked with fixing an agency that has been criticized for mismanagement and bureaucratic malfeasance that has led to long wait times for veterans seeking medical services. White House Press Secretary Josh Earnest played up McDonald’s management history when asked about the appointment during Monday’s press briefing.
Related: McDonald’s VA ‘To-Do List’ Includes 6 Urgent Fixes
“Mr. McDonald was principally chosen because he has the kind of record as a solid manager that will be required of the next Secretary of the Veterans Affairs Department to put in place the reforms that are needed,” Earnest said, in part. “Those management chops are going to be critical to his success, and they’re going to be critical to ensuring that our country lives up to the commitment that we’ve made to our men and women in uniform.”
Earnest also praised what he called McDonald’s history of fostering mentorship and leadership among middle-managers. “Having the kind of management style that inspires other people in an organization to assume leadership skills is something that, based on the problems have been unearthed at the VA, will be really critical to their success over there as well,” he said.
A strong business background doesn’t always translate to success in cutting through the red tape and politics that so often come with being part of the federal bureaucracy, though. “It’s a mixed record,” said Steve Kelman, professor of public management at Harvard’s Kennedy School of Government. “The biggest challenge that corporate executives face when they go into government is understanding the political environment. The more operational their organization is, the more the kinds of skills they have in the corporate world are applicable to government.”
President Obama hasn’t always turned to the business world for top-level appointees, but he did tap former Microsoft executive Kurt DelBene to take over management of HealthCare.gov after another official known for his management background, Jeffrey Zients, left that post to head the National Economic Council. Former Obama Commerce Secretary John Bryson had been CEO of Edison International, the parent company of Southern California Edison.
Related: VA Bill Means a New $50 Billion Entitlement
The list of those who moved from corner offices at Fortune 500 companies to the halls of power in D.C. was a long one in the administration of President George W. Bush. Former Vice President Dick Cheney, of course, had been CEO of Halliburton. Paul O’Neill was the CEO of Pittsburgh-based industrial giant Alcoa and RAND Corporation chairman before becoming the Secretary of the Treasury during Bush’s first term. O’Neill was replaced by John Snow, the former CEO of CSX Corporation. Succeeding Snow was Hank Paulson, the former Goldman Sachs CEO.
Kelman explained that former business executives taking on a government role can struggle with a sudden loss of ability to make the organization operate just as they wish. “It’s often said that the board of directors of a cabinet secretary is 535 people,” Kelman said. “The members of Congress are a very large board of directors. And they are more hands-on than most boards of directors.”
Working in McDonald’s favor is that the VA is not typically the center of political controversy since there is general unity on both sides of the congressional divide about the desire to provide competent services to veterans.
Related: 7 of the Most Outrageous Abuses at VA Medical Centers
Kelman said he perceived corporate chieftains transitioning to government jobs to generally be people of integrity, and the problems they have encountered at times often stemmed from lack of political tact. It’s clear, though, that anyone making the switch from retired CEO to Cabinet Secretary isn’t doing it for the money.
“Compared to his salary at Procter & Gamble, (McDonald will be) practically working for free,” Kelman said.
Top Reads from The Fiscal Times:
- Mark Cuban on How Obamacare Could Help Startups
- How About This 2016 Matchup? Clinton vs. Romney
- New Evidence Shows Insider Trading Is ‘Pervasive’ and Rarely Punished
