oversight

Transportation Security Administration: Actions and Plans to Build a Results-Oriented Culture

Published by the Government Accountability Office on 2003-01-17.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

               United States General Accounting Office

GAO            Report to Congressional Requesters




January 2003
               TRANSPORTATION
               SECURITY
               ADMINISTRATION
               Actions and Plans to
               Build a Results-
               Oriented Culture




GAO-03-190
               a
                                               January 2003


                                               TRANSPORTATION SECURITY
                                               ADMINISTRATION

Highlights of GAO-03-190, a report to          Actions and Plans to Build a Results-
Congressional Requesters
                                               Oriented Culture



Never has a results-oriented focus             In its first year, TSA has simultaneously started to build the infrastructure of a
been more critical than today,                 large organization as it focused primarily on meeting its aviation security
when the security of America’s                 deadlines. As TSA begins to take responsibility for security in the maritime and
citizens depends on the outcomes               surface modes of transportation, its current and future challenge is to continue
of many federal programs. In
                                               to build, sustain, and institutionalize the organizational capacity to help it
response to the September 11
terrorist attacks, the Congress                achieve its current and future goals. In this regard, TSA has made an impressive
passed the Aviation and                        start in implementing practices that can create a results-oriented culture. These
Transportation Security Act                    practices—leadership commitment, strategic planning, performance
(ATSA) that created the                        management, collaboration and communication, and public reporting and
Transportation Security                        customer service—are shown below. Such practices are especially important
Administration (TSA) and made it               when TSA moves into the newly created Department of Homeland Security.
responsible for transportation
security. ATSA requires TSA to                 Selected ATSA requirements, TSA actions and plans, and recommended next steps for each
implement specific practices that              results-oriented practice.
are intended to make it a results-                     ATSA
                                                                          TSA actions and plans            Recommended next steps
                                                   requirements
oriented organization.
                                                               Leadership commitment to creating a high-performing organization
                                                 Performance          Established standardized performance       Establish a performance
                                                 agreements for       agreements for TSA executives.             agreement for the head of TSA and
                                                 head of TSA and                                                 add expectations in performance
GAO makes specific                               executives.                                                     agreements for top leadership to
recommendations to the Secretary                                                                                 foster the culture of a high-
of Transportation and the Under                                                                                  performing organization.
Secretary of Transportation for                                Strategic planning to establish results-oriented goals and measures
Security to continue and augment                 Planning and         Articulated vision, mission, values,       Establish security performance
TSA’s progress in implementing                   reporting            strategic goal, and performance goals      goals and measures for all modes
ATSA’s results-oriented practices.               requirements.        and measures.                              of transportation as part of a
The adjacent table shows selected                                                                                strategic planning process that
                                                                      Developed automated system to collect      involves stakeholders.
recommended next steps for TSA.                                       performance data.
We provided drafts of this report to
                                                                 Performance management to promote accountability for results
officials from the Department of
Transportation (DOT), including                  Performance          Established an interim performance         Ensure the permanent system
                                                 management           management system and created              makes meaningful distinctions in
TSA, for their review and comment.               system and           performance agreements that include        performance.
TSA’s Director of Strategic                      performance          organizational and individual goals and
Management and Analysis provided                 agreements.          standards of performance.                  Involve employees in developing its
oral comments on behalf of DOT                                                                                   permanent system.
and TSA generally agreeing with                                  Collaboration and communication to achieve national outcomes
the contents, findings, and                      Work within and      Established several offices to             Define more clearly the
recommendations of the draft                     outside the          collaborate and communicate with           collaboration and communication
report.                                          government to        stakeholders.                              roles and responsibilities of TSA’s
                                                 accomplish its                                                  various offices.
                                                 mission.             Stated plans to use memorandums to
                                                                      formalize roles and responsibilities of    Formalize roles and responsibilities
                                                                      TSA and other agencies in                  among governmental entities for
                                                                      transportation security.                   transportation security.
                                                                 Public reporting and customer service to build citizen confidence
www.gao.gov/cgi-bin/getrpt?GAO-03-190.           A 180-day action     Submitted 180-day action plan and both     Continue to develop and implement
                                                 plan and two         progress reports within established time   mechanisms, such as the customer
To view the full report, including the scope     progress reports     frames.                                    satisfaction index, to gauge
and methodology, click on the link above.        within 6 months                                                 customer satisfaction and improve
For more information, contact J. Christopher     of enactment.        Stated plans to develop customer           customer service.
Mihm, 202-512-6086, mihmj@gao.gov.                                    satisfaction index.
                                                Source: GAO.
Contents



Letter                                                                                                  1
                           Results in Brief                                                             3
                           Background                                                                   6
                           TSA Actions and Plans to Implement Selected Results-Oriented
                             Practices                                                                 10
                           Concluding Observations                                                     36
                           Recommendations for Executive Action                                        36
                           Agency Comments                                                             37


Appendix
             Appendix I:   Objective, Scope, and Methodology                                           39


Related GAO Products                                                                                   40


Tables                     Table 1: Summary of ATSA Requirements, TSA Actions and Plans,
                                    and Recommended Next Steps, by Results-Oriented
                                    Practice                                                            4
                           Table 2: Summary of Opportunities to Help Ensure Useful Annual
                                    Plans and Applied Practices                                        21


Figures                    Figure 1: Standardized Performance Agreement for TSA
                                     Executives                                                        14
                           Figure 2: DOT and TSA Goal Alignment for Aviation Security                  18
                           Figure 3: TSA’s Interim Performance Management System                       23




                           Abbreviations

                           ATSA      Aviation and Transportation Security Act
                           CSI       customer satisfaction index
                           DHS       Department of Homeland Security
                           DOT       Department of Transportation
                           GPRA      Government Performance and Results Act
                           PBO       performance-based organization




                           Page i                              GAO-03-190 TSA's Results-Oriented Practices
Contents




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Page ii                                       GAO-03-190 TSA's Results-Oriented Practices
A
United States General Accounting Office
Washington, D.C. 20548



                                    January 17, 2003                                                                    Leter




                                    The Honorable Ernest F. Hollings
                                    United States Senate

                                    The Honorable Kay Bailey Hutchison
                                    United States Senate

                                    The Honorable John McCain
                                    United States Senate

                                    The Honorable John D. Rockefeller, IV
                                    United States Senate

                                    Over a year has passed since the terrorist attacks of September 11, 2001,
                                    turned commercial aircraft into missiles, killing thousands of people,
                                    destroying billions of dollars’ worth of property, and realigning our national
                                    priorities. These attacks tragically underscore the forces that are likely to
                                    shape American society, the United States’ place in the world, and the role
                                    of the federal government. The federal government is engaged in a
                                    comprehensive review, reassessment, reprioritization, and as appropriate
                                    reengineering of what the government does, how it does business, and in
                                    some cases, who does the government’s business. Leading public and
                                    private organizations in the United States and abroad have found that for
                                    organizations to successfully transform themselves they must often
                                    fundamentally change their cultures so they are more results oriented,
                                    customer focused, and collaborative in nature.1 Ultimately, federal agencies
                                    will need to transform their cultures to meet the realities of a post-
                                    September 11 environment and the challenges of the 21st century.

                                    In response to the September 11 terrorist attacks, the Congress passed the
                                    Aviation and Transportation Security Act (ATSA) in November 2001, which
                                    created the Transportation Security Administration (TSA) as a new
                                    organization in the Department of Transportation (DOT). According to
                                    ATSA, TSA is responsible for security in aviation and other modes of
                                    transportation. In addition, ATSA requires TSA to implement specific
                                    practices that are intended to make it a results-oriented organization. Also


                                    1
                                      U.S. General Accounting Office, Highlights of a GAO Forum: Mergers and
                                    Transformation: Lessons Learned for a Department of Homeland Security and Other
                                    Federal Agencies, GAO-03-293SP (Washington, D.C.: Nov. 14, 2002).




                                    Page 1                                    GAO-03-190 TSA's Results-Oriented Practices
in response to the September 11 terrorist attacks, the Congress created the
Department of Homeland Security (DHS) to better coordinate the United
States’ efforts to combat terrorism. The creation of this department moves
TSA and its responsibilities for security of all modes of transportation out
of DOT and into the newly created DHS.

A key factor to help organizations achieve their missions and program
results is to implement a positive control environment. A positive control
environment provides discipline and structure as well as the climate that
influences the quality of internal control. In essence, a positive control
environment requires management and employees to establish a supportive
attitude toward internal control and conscientious management. As such,
effective internal control includes strategic planning, budget formulation
and execution, organizational alignment and control, performance
measurement, human capital, financial management, information
technology, and acquisition.

At your request, this report describes TSA’s actions and plans for
implementing the results-oriented practices required in ATSA and
recommends next steps for TSA to take to build a results-oriented
organizational culture and to establish a positive control environment. To
address the objective of this report, we reviewed our models, guides,
reports, and other products on strategic planning and performance
measurement, strategic human capital management, transformation
efforts, and other related areas to identify results-oriented practices and
recommend next steps for TSA. We next analyzed ATSA in relation to our
products to identify any results-oriented practices that were statutorily
required in the legislation. We interviewed officials from various TSA
offices responsible for strategic planning, human capital, training, budget,
public affairs, and policy, among others and reviewed TSA and DOT
missions, performance goals and measures, performance agreements,
policies and procedures, and organizational charts and other relevant
documentation. For additional information on our scope and methodology,
see appendix I.

This report addresses a part of your larger request for GAO to provide
information on the extent to which TSA’s policies, procedures, and
organizational structure are likely to ensure the adequate oversight of its
workforce of air marshals, airline passenger and baggage screeners, and
other security personnel, as well as other matters. We have testified before
your committee and issued reports on TSA and aviation security that
address issues included in your larger request. In an ongoing effort to



Page 2                                GAO-03-190 TSA's Results-Oriented Practices
                   provide real-time, constructive assistance to TSA, we provided TSA with
                   our guides and reports on strategic planning and strategic human capital
                   management. See related GAO products listed at the end of this report for a
                   list of GAO reports, testimonies, guides, and other products related to TSA,
                   transportation security, and results-oriented practices.



Results in Brief   TSA has faced immense challenges in its first year of existence. In its first
                   year, TSA has simultaneously started to build the infrastructure of a large
                   organization as it focused primarily on meeting its aviation security
                   deadlines. TSA reports that it met two of its most significant mandated
                   deadlines—to deploy federal passenger screeners at airports across the
                   nation by November 19, 2002 and to screen every piece of checked baggage
                   for explosives by December 31, 2002.2 To date, TSA has recruited, hired,
                   trained, and deployed over 44,000 federal screeners to meet these
                   deadlines. As TSA begins to take responsibility for security in the maritime
                   and surface modes of transportation, its current and future challenge is to
                   continue to build, sustain, and institutionalize the organizational capacity
                   to help it achieve its current and future goals. In this regard, TSA has made
                   an impressive start in implementing practices in

                   • leadership commitment to creating a high-performing organization,

                   • strategic planning to establish results-oriented goals and measures,

                   • performance management to promote accountability for results,

                   • collaboration and communication to achieve national outcomes, and



                   2
                     The Homeland Security Act of 2002, Public Law 107-296, Nov. 25, 2002, the legislation that
                   created DHS, amends this requirement. According to the legislation, if, in his discretion or at
                   the request of an airport, the Under Secretary of Transportation for Security determines that
                   TSA is not able to deploy explosives detection systems required in ATSA by December 31,
                   2002, then for each airport for which the Under Secretary makes this determination, the
                   Under Secretary shall submit to specific congressional committees a detailed plan for the
                   deployment of the number of explosives detection systems at that airport necessary to meet
                   the requirement as soon as practicable at that airport but no later than December 31, 2003.
                   Also, the Under Secretary shall take all necessary action to ensure that alternative means of
                   screening all checked baggage are implemented until the requirements have been met. TSA
                   reports that as of December 31, 2002, about 90 percent of all checked baggage will be
                   screened using explosives detection systems or explosives trace detection equipment and
                   the remaining checked baggage will be screened using alternative means.




                   Page 3                                          GAO-03-190 TSA's Results-Oriented Practices
                                                  • public reporting and customer service to build citizen confidence.

                                                  These practices establish the foundation of a results-oriented culture that
                                                  will remain critically important when TSA moves into the new DHS.
                                                  Specifically, TSA has begun taking actions required in ATSA and used by
                                                  leading organizations when they emphasize a focus on results. These
                                                  actions lay the groundwork for “recommended next steps” that TSA can
                                                  take to help reinforce a results-oriented culture. ATSA’s requirements, TSA’s
                                                  actions and plans to implement them, and recommended next steps for
                                                  each results-oriented practice are shown in table 1. We provided drafts of
                                                  this report to officials from DOT, including TSA, for their review and
                                                  comment. TSA’s Director of Strategic Management and Analysis provided
                                                  oral comments on behalf of DOT and TSA generally agreeing with the
                                                  contents, findings, and recommendations of the draft report. In addition to
                                                  making minor technical clarifications, we made changes where appropriate
                                                  to reflect progress TSA has made in the results-oriented practices since the
                                                  completion of our audit work.



Table 1: Summary of ATSA Requirements, TSA Actions and Plans, and Recommended Next Steps, by Results-Oriented Practice

     ATSA requirements                              TSA actions and plans                               Recommended next steps
                                   Leadership commitment to creating a high-performing organization
• Requires performance             • Stated leadership commitment to creating a results-        • Establish a performance agreement for the
  agreements between the             oriented culture in its 180-day action plan.                 Under Secretary of Transportation for
  Secretary of DOT and the         • Expressed plans to use the Baldrige performance              Security that articulates how bonuses will
  Under Secretary of                 excellence criteria as a management tool to promote          be tied to performance.
  Transportation for Security        quality and performance.                                   • Add expectations in performance
  and between the Under            • Established standardized performance agreements for          agreements for top leadership to foster the
  Secretary and TSA                  TSA executives.                                              culture of a high-performing organization.
  executives.
                                   Strategic planning to establish results-oriented goals and measures
• Requires a 5-year                • Articulated vision, mission, values, strategic goal, and   • Establish security performance goals and
  performance plan and               performance goals and measures.                              measures for all modes of transportation as
  annual performance report        • Developed automated system to collect performance            part of a strategic planning process that
  consistent with the principles     data to demonstrate progress in meeting goals.               involves stakeholders.
  of the Government                • Aligned aviation security performance goals and            • Apply practices that have been shown to
  Performance and Results            measures with DOT goals.                                     provide useful information in agency
  Act.                             • Reported it submitted its first annual performance           performance plans.
                                     report.




                                                  Page 4                                          GAO-03-190 TSA's Results-Oriented Practices
(Continued From Previous Page)
      ATSA requirements                         TSA actions and plans                             Recommended next steps
                                 Performance management to promote accountability for results
• Requires a performance        • Established an interim performance management     • Build on the current performance
  management system.              system.                                             agreements to achieve additional benefits.
• Requires performance          • Created standardized performance agreements for   • Ensure the permanent performance
  agreements for all              groups of employees that include organizational and management system makes meaningful
  employees that include          individual goals and standards of performance.      distinctions in performance.
  organizational and individual                                                     • Involve employees in developing its
  goals.                                                                              permanent performance management
                                                                                      system.
                                 Collaboration and communication to achieve national outcomes
• Requires TSA to work within • Established Offices of Security Regulation and Policy, • Define more clearly the collaboration and
  and outside the government     Communications and Public Information, Law              communication roles and responsibilities of
  to accomplish its mission.     Enforcement and Security Liaison, and Legislative       TSA’s various offices.
• Establishes a Transportation   Affairs to collaborate and communicate with           • Formalize roles and responsibilities among
  Security Oversight Board to    stakeholders.                                           governmental entities for transportation
  facilitate collaboration and • Convened the Oversight Board, which has met twice.      security.
  communication.               • Stated plans to use memorandums of understanding
                                 and memorandums of agreement to formalize roles and
                                 responsibilities of TSA and other agencies in
                                 transportation security.
                                Public reporting and customer service to build citizen confidence
• Requires a 180-day action    • Submitted 180-day action plan and both progress          • Fill the ombudsman position to facilitate
  plan and two progress          reports within established time frames.                    responsiveness of TSA to the public.
  reports within 6 months of   • Maintains a Web site to provide information to the       • Continue to develop and implement
  enactment.                     public.                                                    mechanisms, such as the customer
                               • Created ombudsman position to serve customers.             satisfaction index, to gauge customer
                               • Developed measures to track customer satisfaction.         satisfaction and improve customer service.
                               • Reviewed and eliminated security procedures that do
                                 not enhance security or customer service.
                               • Stated plans to develop a customer satisfaction index to
                                 analyze customer opinions to improve performance.
Source: GAO analysis.




                                              Page 5                                       GAO-03-190 TSA's Results-Oriented Practices
Background   Unlike other federal organizations that must transform their existing
             cultures, TSA has the opportunity to create a culture that fosters high
             performance from the outset. For TSA, this means creating a culture that
             focuses on

             • results rather than processes;

             • matrixes rather than stovepipes;

             • an external (citizen, customer, and stakeholder) perspective rather than
               an inward perspective;

             • employee empowerment rather than micromanagement;

             • risk management rather than risk avoidance; and

             • knowledge sharing rather than knowledge hoarding.

             TSA is an organization facing immense challenges to simultaneously build
             the infrastructure of a large government agency responsible for security in
             all modes of transportation and meet unprecedented deadlines required in
             ATSA to federalize aviation security. Two of the most significant deadlines
             require TSA to

             • deploy federal passenger screeners at security checkpoints at 429
               airports across the nation by November 19, 2002, and

             • install explosives detection systems to screen every piece of checked
               baggage for explosives no later than December 31, 2002.




             Page 6                                GAO-03-190 TSA's Results-Oriented Practices
In July 2002, we testified before your committee on the progress TSA has
made in enhancing aviation security and in meeting the deadlines to deploy
federal screeners at security checkpoints and to install explosives
detection systems.3 At that time, we reported that while TSA’s efforts were
well underway to hire and train thousands of key security personnel,
including federal screeners and security directors, TSA had experienced
unexpected delays in finding and hiring security screener personnel who
met the requirements of ATSA.4 We also reported that while TSA had made
progress in checking all bags for explosives and planning for the purchase
and installation of explosives detection equipment, TSA had not kept pace
with planned milestones to meet congressional deadlines for using
explosives detection systems to screen 100 percent of checked baggage. In
addition, we reported that TSA had not fully implemented the
responsibilities required in ATSA such as the security of other modes of
transportation, cargo security, and general aviation security. Finally, we
also observed that the move of TSA from DOT to a DHS poses further
challenges that may delay progress on meeting mandated deadlines and
addressing other security vulnerabilities in the nation’s transportation
system.




3
  U.S. General Accounting Office, Aviation Security: Transportation Security
Administration Faces Immediate and Long-Term Challenges, GAO-02-971T (Washington,
D.C.: July 25, 2002).
4
  ATSA requires that federal security screener personnel have a satisfactory or better score
on a federal security screening personnel selection examination; be a U.S. citizen; possess a
high school diploma, general equivalency diploma, or experience that the Under Secretary
has determined to be sufficient for the individuals to perform the duties of the position; have
basic aptitudes and physical abilities, including color perception, visual and aural acuity,
physical coordination, and motor skills; have English proficiency to include reading,
speaking, and writing in English; have the ability to demonstrate daily a fitness for duty
without impairment due to illegal drugs, sleep deprivation, medication, or alcohol;
successfully pass an employment investigation background check (including a criminal
history record check); not pose a national security risk or threat; and satisfactorily complete
all initial, recurrent, and appropriate specialized training required by the security program.
The requirement for U.S. citizenship was subsequently changed by Public Law 107-296,
Nov. 25, 2002, to include legal residents of the United States.




Page 7                                          GAO-03-190 TSA's Results-Oriented Practices
TSA and DOT leadership have also testified before the Congress at several
hearings on challenges TSA was facing as it tried to meet its deadlines and
other transportation security responsibilities while establishing itself as a
federal organization.5 Leadership stated that one of TSA’s challenges is to
build a large organization from the ground up. Specifically, in January 2002,
TSA only had approximately 15 employees of the more than 60,000 it
reported it would need by the end of 2002. In addition, the Under Secretary
of Transportation for Security testified that at that time the congressionally
mandated cap on the number of employees it can employ of 45,000 would
limit its ability to meet the deadlines. TSA also testified on the need for
additional funding to meet its security responsibilities and the delays it
experienced in receiving this funding. According to TSA and DOT, delays in
funding and restrictions on the use of the additional funding at that time
had undermined TSA’s ability to meet the deadlines. DOT leadership stated
that TSA is especially disadvantaged by operating under a continuing
resolution because it does not have money from previous years to help
bridge the gaps between programmatic needs and the funding it receives
under the continuing resolution.

When the Congress created TSA, it required practices consistent with other
government initiatives to restructure their agencies in order to instill
results-oriented organizational cultures. In the United States and abroad,
governments have restructured their agencies to improve the delivery of
government services and clarify accountability for results. During the 1980s
and 1990s, the Organisation for Economic Co-operation and Development
reported that its member countries increased efforts to restructure their
public sector organizations for results.6 Among member countries,
restructured organizations represent about 50 percent, sometimes as high
as 75 percent, of public expenditure and public servants.


5
 Statement of Admiral James Loy, Acting Under Secretary of Transportation for Security
before the Commerce, Science, and Transportation Committee, U.S. Senate on
September 10, 2002; Statement of Stephen J. McHale, Deputy Under Secretary of
Transportation for Management and Policy, Transportation Security Administration, before
the Committee on Government Reform, U.S. House of Representatives in Atlanta, Georgia
on August 7, 2002; Statement of the Honorable Norman Y. Mineta, Secretary of
Transportation before the Committee on Commerce, Science, and Transportation,
U.S. Senate on July 25, 2002; Statement of the Honorable Norman Y. Mineta, Secretary of
Transportation before the Subcommittee on Aviation, Committee on Transportation and
Infrastructure, U.S. House of Representatives on July 23, 2002.
6
  Organisation for Economic Co-operation and Development, Distributed Public
Governance: Agencies Authorities And Other Autonomous Bodies, Preliminary Draft
(Nov. 14, 2001).




Page 8                                       GAO-03-190 TSA's Results-Oriented Practices
In 1988, the United Kingdom started to restructure its government agencies
to increase their focus on accountability and improve customer service.
Called “executive agencies,” these restructured agencies are still the
predominant form of service delivery in the United Kingdom. As of
December 2001, there were over 130 executive agencies covering more
than three-quarters of the British civil service. In July 2002, the Prime
Minister’s Office of Public Services Reform reviewed the performance of
these executive agencies and set out to identify management principles
that may have contributed to their success.7 The Prime Minister’s Office
concluded that the restructured executive agency model has been a
success and the management principles underlying the restructured
agencies continue to be highly relevant. These principles are: (1) a clear
focus on delivering specified goals within a framework of accountability,
(2) responsibility for performance resting clearly with the chief executive
and agency staff, and (3) an agency focus that is outward rather than
inward.

In the 1990s, the Congress recognized the need to restructure federal
agencies and to hold them accountable for achieving program results.8 To
this end, the Congress established performance-based organizations
(PBOs), modeled after the United Kingdom’s executive agencies: the Office
of Student Financial Assistance, United States Patent and Trademark
Office, and Air Traffic Organization. Designed in statute, PBOs were to
commit to clear management objectives and specific targets for improved
performance. These clearly defined performance goals, coupled with direct
ties between the achievement of performance goals and the pay and tenure
of the head of the PBO and other senior managers, were intended to lead to
improved performance. Specifically, the head of the PBO is appointed for a
set term, subject to annual performance agreements, and eligible for
bonuses for improved organizational performance.

Similarly for TSA, the Congress required an Under Secretary to be
appointed for a 5-year term to manage TSA who is entitled to a bonus based

7
  The Prime Minister’s Office of Public Services Reform, Better Government Services:
Executive Agencies in the 21st Century (London: 2002).
8
 U.S. General Accounting Office, Federal Student Aid: Additional Management
Improvements Would Clarify Strategic Direction and Enhance Accountability, GAO-02-
255 (Washington, D.C.: Apr. 30, 2002); Performance-Based Organizations: Lessons Learned
From the British Next Steps Initiative, GAO/T-GGD-97-151 (Washington, D.C: July 8, 1997);
and Performance-Based Organizations: Issues for the Saint Lawrence Seaway
Development Corporation Proposal, GAO/GGD-97-74 (Washington, D.C: May 15, 1997).




Page 9                                        GAO-03-190 TSA's Results-Oriented Practices
                        on performance; measurable goals to be outlined in a 5-year performance
                        plan and reported annually; a performance management system to include
                        individual and organizational goals for managers and employees; an annual
                        performance agreement for the Under Secretary, senior managers, and
                        staff; an oversight board to facilitate communication and collaboration; and
                        public reporting requirements to build citizen confidence.

                        TSA will be 1 of over 20 originating agencies or their components with
                        differing missions, cultures, systems, and procedures that are to move into
                        DHS. The newly created DHS is the most recent manifestation of the
                        continuing consideration of how best to restructure government to respond
                        to the challenges of the 21st century. At a GAO-sponsored forum on mergers
                        and transformation, participants observed that people and cultural issues
                        are at the center of successful mergers and transformations. 9 The
                        importance of these issues should not be avoided, but aggressively
                        addressed at the outset and throughout the process.



TSA Actions and Plans   Within its first year of existence, TSA has made an impressive start in
                        implementing practices that can create a results-oriented organizational
to Implement Selected   culture and help TSA as it begins to take responsibility for the security of
Results-Oriented        the maritime and surface modes of transportation. These practices include
Practices               • leadership commitment to creating a high-performing organization,

                        • strategic planning to establish results-oriented goals and measures,

                        • performance management to promote accountability for results,

                        • collaboration and communication to achieve national outcomes, and

                        • public reporting and customer service to build citizen confidence.

                        TSA’s actions and plans to implement the results-oriented practices
                        required in ATSA and recommended next steps that can help TSA build a
                        results-oriented culture are described on the following pages.




                        9
                         GAO-03-293SP.




                        Page 10                               GAO-03-190 TSA's Results-Oriented Practices
Leadership Commitment to     A critical element and the foundation of TSA’s successful implementation
Creating a High-Performing   of results-oriented practices will be the demonstrated and sustained
                             commitment of its top leaders. Ultimately, successful organizations
Organization                 understand that they must often change their culture to successfully
                             transform themselves, and that such a change starts with top leadership.
                             Top leadership involvement is essential to overcoming an organization’s
                             natural resistance to change, marshalling the resources needed in many
                             cases to improve management, and building and maintaining the
                             organizationwide commitment to new ways of doing business. At a recent
                             GAO-sponsored roundtable, we reported on the necessity to elevate
                             attention, integrate various efforts, and institutionalize accountability to
                             lead efforts to fundamentally transform an agency and address key
                             management functions at the highest appropriate level in the
                             organization.10 At TSA, the leadership faces a daunting challenge to create
                             this results-oriented culture. From the outset, this challenge was
                             exacerbated by the change in TSA’s head position, the Under Secretary of
                             Transportation for Security, just 8 months after the organization was
                             established. TSA has continually stated its commitment to becoming a
                             high-performing organization, and has reinforced that commitment in its
                             performance agreements for TSA executives.

                             TSA leadership has expressed its commitment to creating a results-
                             oriented organizational culture. Specifically, in its 180-day action plan
                             report to the Congress outlining goals and milestones for defining
                             acceptable levels of performance in aviation security, TSA stated that it is
                             committed to “being a leading-edge, performance-based organization—an
                             organization whose operative culture establishes performance
                             expectations that support the mission, drives those expectations into
                             organizational and individual performance plans, and collects objective
                             data to assess its performance.”




                             10
                                U.S. General Accounting Office, Highlights of a GAO Roundtable: The Chief Operating
                             Officer Concept: A Potential Strategy To Address Federal Governance Challenges, GAO-03-
                             192SP (Washington, D.C.: Oct. 4, 2002).




                             Page 11                                     GAO-03-190 TSA's Results-Oriented Practices
TSA leadership also plans to use the Baldrige performance excellence
criteria as a management tool to promote an awareness of quality and
performance in TSA.11 These criteria are: leadership, strategic planning,
customer and market focus, information and analysis, human resource
focus, process management, and business results. TSA leadership hired a
former Baldrige award application examiner to be TSA’s Chief Quality
Officer and to head the Office of Quality Performance. According to TSA
officials, the Office of Quality Performance will serve as internal
consultants to TSA management to help them use the Baldrige criteria as a
tool to create a culture focused on performance.

To hold TSA’s leadership accountable for achieving results, ATSA requires
TSA to establish a performance agreement between the Under Secretary
and the Secretary of DOT that includes organizational and individual
performance goals. A TSA official told us that as of November 2002, no
performance agreement had been finalized for the Under Secretary since
the current Under Secretary has been acting in the position.12 During times
of transition, high-performing organizations recognize that performance
agreements can reinforce accountability for organizational goals.13 To this
end, when TSA moves into its new parent department, DHS, TSA can use
performance agreements to maintain a consistent focus on its goals. ATSA
also allows for the Under Secretary to receive a bonus for any calendar
year up to 30 percent of the annual rate of pay, based on a performance
evaluation. However, TSA’s interim performance management system does
not specifically address performance bonuses for the head of TSA.

In addition, ATSA requires TSA to establish performance agreements
between TSA’s Under Secretary and his or her executives that set
organizational and individual performance goals. TSA has created a
standardized performance agreement for TSA executives as a part of its
interim performance management system. TSA’s executive agreements


11
 The Baldrige performance excellence criteria are used as the basis of the Baldrige Award,
which is given by the President of the United States to organizations that are judged to be
outstanding in seven criteria. The Congress established the award program to recognize
organizations for their achievements in quality and performance and to raise awareness
about the importance of quality and performance as a competitive edge.
12
 The acting Under Secretary of Transportation for Security was sworn in on November 25,
2002.
13
 U.S. General Accounting Office, Managing for Results: Emerging Benefits From Selected
Agencies’ Use of Performance Agreements, GAO-01-115 (Washington, D.C.: Oct. 30, 2000).




Page 12                                       GAO-03-190 TSA's Results-Oriented Practices
include both organizational and individual goals, as shown in figure 1. For
example, each executive performance agreement includes an
organizational goal such as to maintain the nation’s air security and ensure
an emphasis on customer satisfaction. The agreement also includes
individual goals, such as to meet or exceed requirements for satisfactory
performance and to demonstrate commitment to civil rights. In addition,
the agreement includes competencies, such as to provide leadership in
setting the workforce’s expected performance levels and ensure that the
executive’s work unit contributes to the accomplishment of TSA’s mission.
TSA can strengthen these performance agreements by setting explicit
targets that are directly linked to organizational goals.




Page 13                               GAO-03-190 TSA's Results-Oriented Practices
Figure 1: Standardized Performance Agreement for TSA Executives
  Employee Name:                                                                         Position: Executive                             Organization:

  Performance Period:                                                                    Social Security Number:

  From:                   To:
  As a Transportation Security Administration executive, I will work diligently to achieve the following organizational and individual goals:
  Organizational Goal(s):     TSA will improve and maintain the security of American air travel by effectively deterring or preventing successful
                              terrorist (or other) incidents on airlines and at airports, with minimal disruption to transportation and complete service
                              to travelers.

                                 While maintaining the nation’s air security, TSA employees will ensure an emphasis on customer satisfaction.

                                 During the first year of TSA, make substantial contributions toward the successful creation of the Administration and
                                 the accomplishment of organizational goals, i.e., federalize aviation security; improve security; and customer
                                 satisfaction.

                                 Supplemental Goal(s): (The supervisor may include additional organizational goal(s) here.)
  Individual Goal(s):            My organization will continuously set the standard for excellence in transportation security through its people,
                                 processes, and technologies.

                                 I will meet or exceed all requirements for Satisfactory Performance.

                                 I will demonstrate through actions, words and leadership, my commitment to civil rights at TSA.

                               (Add at least one program goal.)
  I also agree to meet or exceed the following level of performance:
  Standard for Satisfactory    I will:
  Performance:                 ƒ Exercise leadership and motivate managers to incorporate vision, and strategic planning that integrates key
                                       national and program goals and priorities.
                               ƒ Provide leadership in setting the work force’s expected performance levels, guiding other towards goal
                                       accomplishment, and effectively using the performance management system.
                               ƒ Make timely and effective decisions and produce results through strategic planning and the implementation and
                                       evaluation of programs and polices.
                               ƒ Acquire and administer resources effectively. Identify and plan for a cost-effective mix of financial, human and
                                       material resources to achieve program accomplishments. Apply merit principles and promote equality and
                                       diversity in all aspects of human resource management.
                               ƒ Effectively represent the organization internally and externally. Establish and maintain working relationships,
                                       facilitate the exchange of ideas, coordinate internal program matters, develop and enhance alliances and gain
                                       cooperation to accomplish goals.
                               ƒ Ensure that my work unit contributes to the accomplishment of TSA’s mission and vision; and that members of
                                       my work unit conduct themselves in a way that supports TSA’s values.

                            Supplemental Standard(s): (The supervisor may include additional standard(s) here.)
  Performance Agreement Initiation:                                      Executive signature and date:

                                                                                     Supervisor signature and date:
  Mid-Cycle Review:                                                                  Executive signature and date:

                                                                                     Supervisor signature and date:
  Performance Assessment at the end of the appraisal period (supervisor              The employee met or exceeded the standard for satisfactory
  should circle yes or no):                                                          performance: Yes No
  Executive signature and date:                                                      Supervisor signature and date:

Source: TSA.




                                                     Page 14                                              GAO-03-190 TSA's Results-Oriented Practices
                         Governmentwide, to help hold senior executives accountable for
                         organizational results, federal agencies are to establish performance
                         management systems that (1) hold senior executives accountable for their
                         individual and organizational performance by linking performance
                         management with the results-oriented goals of the Government
                         Performance and Results Act (GPRA); (2) evaluate senior executive
                         performance using measures that balance organizational results with
                         customer satisfaction, employee perspectives, and any other measures
                         agencies decide are appropriate; and (3) use performance results as a basis
                         for pay, awards, and other personnel decisions. We have found that
                         progress is needed in explicitly linking senior executive expectations for
                         performance to results-oriented organizational goals and greater emphasis
                         should be placed in fostering the necessary collaboration both within and
                         across organizational boundaries to achieve results.14 Furthermore, a
                         specific performance expectation to lead and facilitate change could be a
                         critical element as agencies transform themselves to succeed in an
                         environment that is more results oriented, less hierarchical, and more
                         integrated.

Recommended Next Steps   Establish a performance agreement for the Under Secretary of
                         Transportation for Security that articulates how bonuses will be
                         tied to performance. To hold the Under Secretary accountable for
                         achieving results, DOT, or the new parent department DHS, should create a
                         performance agreement for the Under Secretary that includes
                         organizational and individual goals and also articulates how bonuses for
                         the Under Secretary will be tied to his performance in achieving the goals
                         in the performance agreement.

                         Add expectations in performance agreements for top leadership to
                         foster the culture of a high-performing organization. Successful
                         organizations understand that top leadership performance and
                         accountability are critical to their success and to the success of the federal
                         government’s transformation. TSA can strengthen its current performance
                         agreements for top leadership, including the Under Secretary and senior
                         executives, by adding performance expectations that

                         • establish explicit targets directly linked to organizational goals,



                         14
                           U.S. General Accounting Office, Results-Oriented Cultures: Using Balanced Expectations
                         to Manage Senior Executive Performance, GAO-02-966 (Washington, D.C.: Sept. 27, 2002).




                         Page 15                                     GAO-03-190 TSA's Results-Oriented Practices
                             • foster the necessary collaboration within and across organizational
                               boundaries to achieve results, and

                             • demonstrate commitment to lead and facilitate change.



Strategic Planning to        Strategic planning is a continuous, dynamic, and inclusive process that
Establish Results-Oriented   provides the foundation for the fundamental results the organization seeks
                             to achieve. ATSA’s requirements for TSA are consistent with the results-
Goals and Measures
                             oriented planning and reporting principles embodied in GPRA. GPRA
                             provides a strategic planning and management framework intended to
                             improve federal performance and hold agencies accountable for achieving
                             results. Effective implementation of this framework requires agencies to
                             clearly establish results-oriented performance goals in strategic and annual
                             performance plans for which they will be held accountable, measure
                             progress towards those goals, determine the strategies and resources to
                             effectively accomplish the goals, use performance information to make the
                             programmatic decisions necessary to improve performance, and formally
                             communicate results in performance reports. Specifically, ATSA requires
                             TSA to submit to the Congress a 5-year performance plan and an annual
                             performance report, but does not specify when these documents are to be
                             submitted to the Congress.

                             TSA has taken the first steps to establishing the performance planning and
                             reporting framework consistent with GPRA. The starting point for the
                             framework envisioned under GPRA is the strategic plan that describes an
                             organization’s mission, outcome-oriented strategic goals, strategies to
                             achieve these goals, and key factors beyond the agency’s control that could
                             impact the goals’ achievement, among other things. According to TSA
                             officials, TSA is currently developing its strategic plan. TSA has, however,
                             made components of its plan public. TSA has articulated its mission, vision,
                             and values. TSA’s mission is to protect the nation’s transportation systems
                             to ensure freedom of movement for people and commerce. TSA’s vision is
                             to continuously set the standard for excellence in transportation security
                             through people, processes, and technologies and its values are integrity,
                             innovation, courtesy and respect, competence, customer focus, dedication,
                             diversity, and teamwork. In addition, TSA has set an overall strategic goal:
                             to prevent intentional harm or disruption to the transportation system by
                             terrorists or other persons intending to cause harm. To support this
                             strategic goal, TSA has defined three performance goals:

                             • meeting the ATSA mandates to federalize transportation security,



                             Page 16                               GAO-03-190 TSA's Results-Oriented Practices
• maintaining and improving aviation security, and

• servicing TSA customers.

To demonstrate its progress toward meeting its performance goals, TSA
established an initial set of 32 performance measures. For example, TSA’s
primary performance measures for its performance goal to maintain and
improve aviation security are the percentage of bags screened by
explosives detection systems and the percentage of trained screeners.
Other measures to complement these primary measures include the
percentage of explosives detection systems deployed, the percentage of
screeners with 60 hours of on-the-job training completed, and the
percentage of screeners compliant with training standards. TSA plans to
develop more outcome-oriented goals and measures in fiscal year 2003 and
is in the process of finalizing strategies to achieve its goals.

To report on its progress in meeting its performance goals and measures,
TSA has begun to build the capacity to gather and use organizational
performance information. TSA has installed an automated performance
management information system, which became operational in April 2002
and is designed to collect and report data on TSA’s performance measures.
Data will be collected from federal security directors, security screener
supervisors, and headquarters officials and reported through Web-based
reports designed for internal decision making and external reporting.
According to TSA officials, the system will be expanded to include goals
and measures related to all modes of transportation in upcoming fiscal
years. As required by ATSA, TSA reported on November 19, 2002, that it
submitted its first annual performance report.

TSA has linked its aviation security performance goals to those of its parent
department, DOT, to provide a clear, direct understanding of how the
achievement of its performance goals will lead to the achievement of DOT’s
strategic goal for homeland security, as shown in figure 2. Specifically,
TSA’s performance goals to federalize and maintain and improve aviation
security are intended to contribute to DOT’s performance goal to “reduce
vulnerability to crime and terrorism and promote regional stability” and its
strategic goal on homeland security, to “ensure the security of the
transportation system for the movement of people and goods and support
the National Security Strategy.” As TSA establishes its performance goals
for other modes of transportation, it should continue to align its goals with
DOT’s goals. When TSA moves to DHS, it will be necessary to maintain goal
alignment with its new parent department.



Page 17                                GAO-03-190 TSA's Results-Oriented Practices
Figure 2: DOT and TSA Goal Alignment for Aviation Security

DOT strategic                         Homeland security - Ensure the security of the transportation system for the movement of people and goods,
goal                                                                  and support the National Security Strategy



DOT
performance                                                     Reduce vulnerability to crime and terrorism and promote regional stability
goal

DOT
performance
goals for                 Ensure that no terrorist or other individual is successful in                                      Reduce passenger waiting time at screening
aviation                 causing harm or significant disruption to the aviation system                                        checkpoints to no more than 10 minutes,
security                                                                                                                               95 percent of the time




TSA
strategic                   Prevent intentional harm or disruption to the transportation system by terrorists or other persons intending to cause harm
goal




TSA                                Federalize aviation                                        Maintain and improve
performance                                                                                                                                     Customer satisfaction
                                        security                                                aviation security
goals



                                                     Percentage of                    Percentage of                                         Percentage of
TSA primary               Percentage of                                                                         Percentage of                                  Average
                                                   airports that have               bags screened by                                       complaints per
performance               required staff                                                                           trained                                     customer
                                                    been rolled over                   explosives                                              1,000
measures                    on board                                                                             screeners                                     wait time
                                                  to federal authority              detection systems                                        passengers


Source: GAO analysis based on "FY 2003 DOT Performance Plan" and "TSA Initial Performance Measures and Their Definitions".




                                                                 Page 18                                                        GAO-03-190 TSA's Results-Oriented Practices
                         GPRA requires agencies to consult with the Congress and solicit the views
                         of other stakeholders as they develop their strategic plans.15 However, TSA
                         has stated few plans to involve stakeholders in its strategic planning
                         process. Such consultations provide an important opportunity for TSA and
                         the Congress to work together to ensure that agency missions are focused,
                         goal are specific and results oriented, and strategies and funding
                         expectations are appropriate and reasonable. Results-oriented
                         organizations also recognize that it is important to broaden stakeholder
                         involvement to create a basic understanding among stakeholders of
                         competing goals. As TSA works to meet its goals, it will continue to face
                         ongoing challenges to balance aviation security against customer service.
                         While TSA needs to screen passengers and baggage carefully to meet its
                         goal to maintain the security of the aviation system, it must efficiently
                         move customers and their baggage through the aviation system to minimize
                         passenger inconvenience to encourage them to continue using air
                         transportation.

Recommended Next Steps   Establish security performance goals and measures for all modes
                         of transportation as part of a strategic planning process that
                         involves stakeholders. Stakeholder involvement, and specifically
                         congressional consultation, is particularly important for TSA in its strategic
                         planning process given the importance of its mission and the necessity to
                         establish additional goals to address other modes of transportation. In
                         addition, TSA operates in a complex political environment where there will
                         be the ongoing need to balance the sometimes conflicting goals of security
                         and customer service.

                         We identified approaches that can enhance the usefulness of consultations
                         between TSA and the Congress that can also apply to consultations with
                         external stakeholders.16 Among the approaches are the following.

                         • Engage the right people. Including people who are knowledgeable about
                           the topic at hand, such as TSA officials who are knowledgeable about
                           particular transportation modes and specific programs, is important
                           when consulting with the Congress and other stakeholders.

                         15
                          U.S. General Accounting Office, Agencies’ Strategic Plans Under GPRA: Key Questions to
                         Facilitate Congressional Review, GAO/GGD-10.1.16 (Washington, D.C.: May 1997).
                         16
                          U.S. General Accounting Office, Managing for Results: Enhancing the Usefulness of
                         GPRA Consultations Between the Executive Branch and Congress, GAO/T-GGD-97-56
                         (Washington, D.C.: Mar. 10, 1997).




                         Page 19                                     GAO-03-190 TSA's Results-Oriented Practices
• Address differing views. Stakeholders may have differing views on what
  they believe the level of detail discussed during consultation meetings
  should be. For example, participants may want to engage in discussion
  that goes beyond TSA’s mission to the appropriate balance between
  enforcing security and servicing passengers.

• Establish a consultation process that is iterative. All parties involved in
  transportation security recognize that the consultation process should
  be continuous and they should meet as many times as both sides feel are
  necessary to reach a reasonable consensus on TSA’s strategic and
  performance goals to address transportation security.

Apply practices that have been shown to provide useful
information in agency performance plans. Results-oriented
organizations focus on the process of performance planning rather than the
planning documents themselves. GPRA was intended, in part, to improve
congressional decision making by giving the Congress comprehensive and
reliable information on the extent to which federal programs are fulfilling
their statutory intent. We have identified practices that TSA can apply to
ensure the usefulness of its required 5-year performance plan to TSA
managers, the Congress, and other decision makers and interested
parties.17 Table 2 outlines these practices.




17
 U.S. General Accounting Office, Agency Performance Plans: Examples of Practices That
Can Improve Usefulness to Decisionmakers, GAO/GGD/AIMD-99-69 (Washington, D.C.:
Feb. 26, 1999) and Agencies’ Annual Performance Plans Under the Results Act: An
Assessment Guide to Facilitate Congressional Decisionmaking, GAO/GGD/AIMD-10.1.18
(Washington, D.C.: February 1998).




Page 20                                    GAO-03-190 TSA's Results-Oriented Practices
Table 2: Summary of Opportunities to Help Ensure Useful Annual Plans and Applied Practices

Opportunities to help ensure
useful annual plans                  Applied practices
Articulate a results orientation.    1.   Create a set of performance goals and measures that addresses important dimensions of
                                          program performance and balances competing priorities.
                                     2.   Use intermediate goals and measures to show progress or contribution to intended results.
                                     3.   Include explanatory information on the goals and measures.
                                     4.   Develop performance goals to address mission-critical management problems.
                                     5.   Show baseline and trend data for past performance.
                                     6.   Identify projected target levels of performance for multiyear goals.
                                     7.   Link the goals of component organizations to departmental strategic goals.
Coordinate cross-cutting programs.   8.  Identify programs that contribute to the same or similar results.
                                     9.  Set complementary performance goals to show how differing program strategies are mutually
                                         reinforcing and establish common or complementary performance measures, as appropriate.
                                     10. Describe—briefly or refer to a separate document—planned coordination strategies.
Show how strategies will be used to 11. Link strategies and programs to specific performance goals and describe how they will
achieve goals.                          contribute to the achievement of those goals.
                                    12. Describe strategies to leverage or mitigate the effects of external factors on the
                                        accomplishment of performance goals.
                                    13. Discuss strategies to resolve mission-critical management problems.
                                    14. Discuss—briefly or refer to a separate document—plans to ensure that mission-critical
                                        processes and information systems function properly and are secure.
Show performance consequences        15. Show how budgetary resources relate to the achievement of performance goals.
of budget and other resource         16. Discuss—briefly and refer to the agency capital plan—how proposed capital assets
decisions.                               (specifically information technology investments) will contribute to achieving performance
                                         goals.
                                     17. Discuss—briefly or refer to a separate plan—how the agency will use its human capital.
Build the capacity to gather and use 18. Identify internal and external sources for data.
performance information.             19. Describe efforts to verify and validate performance data.
                                     20. Identity actions to compensate for unavailable or low-quality data.
                                     21. Discuss implications of data limitations for assessing performance.
Source: GAO/GGD/AIMD-99-69.




                                              Page 21                                       GAO-03-190 TSA's Results-Oriented Practices
Performance Management      TSA has an opportunity to use its individual performance management
to Promote Accountability   system as a strategic tool to drive internal change and achieve external
                            results. TSA, as a new organization, has a critical challenge in
for Results                 (1) integrating potentially more than 60,000 employees into a new
                            organization, (2) creating a common culture, and (3) achieving its security,
                            customer satisfaction, and related performance goals in an effective,
                            efficient, and economical manner. The individual performance
                            management system can be an essential tool in meeting all three of the
                            above. To help agency leaders manage their people and integrate human
                            capital considerations into daily decision making and the program results
                            they seek to achieve, we developed a strategic human capital model.18 The
                            model highlights the kinds of thinking that agencies should apply, as well as
                            some of the steps they can take, to make progress in managing human
                            capital strategically. In our model, we identify two critical success factors
                            that can assist organizations in creating results-oriented cultures: (1) a “line
                            of sight” showing how unit and individual performance link to
                            organizational goals and (2) the inclusiveness of employees. TSA can apply
                            these factors to its performance management system to help create a
                            results-oriented culture.

                            ATSA requires TSA to establish a performance management system that is
                            to strengthen the organization’s effectiveness by providing for the
                            establishment of goals for managers, employees, and the organization that
                            are consistent with the agency’s performance plan. TSA used the Federal
                            Aviation Administration’s system until it established its own system in July
                            2002, when TSA leadership approved an interim employee performance
                            management system. The interim system is to remain in place until a
                            permanent system is created and implemented. As of November 2002, TSA
                            had not established a time frame for implementing its permanent
                            performance management system.

                            TSA’s interim system provides specific requirements for planning individual
                            performance, monitoring that performance, determining employee
                            development needs, appraising performance, and recognizing and
                            rewarding performance, as shown in figure 3. For example, at the
                            beginning of the appraisal cycle, employees’ expectations are to be
                            established using a performance agreement; throughout the cycle


                            18
                             U.S. General Accounting Office, A Model of Strategic Human Capital Management, GAO-
                            02-373SP (Washington, D.C.: Mar. 15, 2002).




                            Page 22                                   GAO-03-190 TSA's Results-Oriented Practices
                                                              supervisors are to monitor performance; halfway through the performance
                                                              cycle supervisors are to provide feedback to employees and identify
                                                              employee development needs; and at the end of the cycle, supervisors are
                                                              to appraise performance at two levels: fully satisfactory and unacceptable.
                                                              Employees may then receive a bonus or other incentive if their
                                                              performance is at the fully satisfactory level. TSA’s first appraisal cycle
                                                              ended November 15, 2002.



Figure 3: TSA’s Interim Performance Management System



                                                                     Planning performance
                                                            Employees are to receive a performance
                                                            agreement establishing their performance
                                                          expectations within 30 days of the employees'
                                                                            start date.




                           Recognizing and
                       rewarding performance
                                                                                                                Monitoring performance
               Employees may receive a bonus or other
                                                                                                       Employees are to receive feedback halfway
                  incentive if they have demonstrated
               performance at the fully satisfactory level.                                           through the performance cycle and at the end
               Supervisors must provide justification for                                                       of the performance cycle.
                                  awards.




                                    Appraising performance                                         Developing performance
                            Employees' performance is to be appraised                      Supervisors are to work with employees to
                               against the goals described in their                     identify developmental needs and opportunities
                             performance agreements. The appraisal                       such as on-the-job training, formal training, or
                             includes two levels: (1) fully satisfactory
                                                                                                          mentoring.
                                      and (2) unacceptable.




Source: TSA.



                                                              In addition, ATSA requires that TSA’s performance agreements for its
                                                              employees include individual and organizational goals. These performance
                                                              agreements can help TSA align individual and organizational goals and



                                                              Page 23                                         GAO-03-190 TSA's Results-Oriented Practices
establish the line of sight that helps create a results-oriented culture. TSA
has created standardized performance agreements for groups of employees
including transportation security screeners, supervisory transportation
security screeners, supervisors, and executives. These performance
agreements include a consistent set of organizational goals, individual
goals, and standards for satisfactory performance. Supervisors may
customize performance agreements for the individual job by adding
additional organizational and individual goals and standards of
performance. For example, the standardized performance agreement for
security screeners includes two organizational goals: (1) to improve and
maintain the security of American air travel by effectively deterring or
preventing successful terrorist (or other) incidents on aircraft and at
airports, with minimal disruption to transportation and complete service to
travelers and (2) to ensure an emphasis on customer satisfaction while
maintaining the nation’s air security. In addition, the standardized
performance agreement for security screeners includes an individual goal
to consistently meet or exceed the basic proficiency requirements by:

• vigilantly carrying out duties with utmost attention to tasks that will
  prevent security threats,

• demonstrating the highest levels of courtesy to travelers and working to
  maximize their levels of satisfaction with TSA services,

• working as an effective team member at assigned post to ensure that
  security violations do not get past the team,

• contributing to the accomplishment of TSA’s mission and vision,

• behaving in a way that supports TSA’s values, and

• demonstrating the highest level of concern for the civil rights of
  coworkers and the traveling public.

Finally, the agreement includes standards for satisfactory performance for
security screeners. Standards include (1) completing all required training
successfully and as scheduled, performing satisfactorily on required
proficiency reviews, and passing operational testing satisfactorily and
(2) performing security functions in an effective and timely manner in
accordance with TSA prescribed guidelines.




Page 24                                GAO-03-190 TSA's Results-Oriented Practices
                         As described in our strategic human capital model, in addition to and
                         concurrent with the first critical success factor of creating a line of sight
                         showing how unit and individual performance link to organizational goals,
                         successful organizations involve employees to build results-oriented
                         cultures. This critical success factor is especially timely for TSA as it
                         transitions from its interim performance management system and finalizes
                         its permanent system. Particularly when developing a new results-oriented
                         performance management system, leading organizations have found that
                         actively involving employees can build confidence and belief in the system.
                         We reported that when reforming their performance management systems,
                         agencies in other countries consulted a wide range of stakeholders early in
                         the process, obtained feedback directly from employees, and engaged
                         employee unions or associations.19

Recommended Next Steps   Build on the current performance agreements to achieve
                         additional benefits. Successful organizations design and implement
                         performance management systems that align individual employee
                         performance expectations with agency goals so that individuals understand
                         the connections between their daily activities and their organization’s
                         success. While TSA has created standardized performance agreements for
                         groups of employees as a part of its interim performance management
                         system, it can also use its performance agreements to achieve benefits by
                         doing the following.20

                         • Strengthen alignment of results-oriented goals with daily operations.
                           Performance agreements can define accountability for specific goals
                           and help align daily operations with agencies’ results-oriented
                           programmatic goals. As TSA continues to develop and gain experience
                           with performance agreements, TSA should ensure an explicit link exists
                           between individual performance expectations and organizational goals
                           for all employees. For example, while TSA lists certain competencies for
                           individuals that are related to organizational goals such as
                           demonstrating the highest level of courtesy to travelers, the next step is
                           to set individual targets to meet the organizational goals.




                         19
                           U.S. General Accounting Office, Results-Oriented Cultures: Insights for U.S. Agencies
                         from Other Countries’ Performance Management Initiatives, GAO-02-862 (Washington,
                         D.C.: Aug. 2, 2002).
                         20
                              GAO-01-115.




                         Page 25                                      GAO-03-190 TSA's Results-Oriented Practices
• Foster collaboration across organizational boundaries. Performance
  agreements can encourage employees to work across traditional
  organizational boundaries or “silos” by focusing on the achievement of
  organizationwide goals. For example, as TSA continues to assume
  responsibility for security in all modes of transportation, TSA can use
  employee performance agreements to set expectations that encourage
  employees to work collaboratively to achieve cross-cutting
  transportation security goals.

• Enhance opportunities to discuss and routinely use performance
  information to make program improvements. Performance agreements
  can facilitate communication about organizational performance and
  pinpoint opportunities to improve performance. TSA’s performance
  management process offers several opportunities to discuss an
  individual’s performance and how that individual can contribute to
  TSA’s goals when meeting to set performance expectations, reviewing
  midyear progress, and assessing performance at year-end. These formal
  expectation, feedback, and assessment sessions are important to clarify
  responsibility and accountability. As a next step, TSA can ensure that it
  uses its performance agreements as a critical component of its
  performance management process to have on-going, two-way
  consultations between employees and their supervisors. In other words,
  strategic performance management—a performance management
  system that is tied to organizational goals—is not just a once- or twice-a-
  year formal occurrence, but rather is ongoing and routine.

• Provide a results-oriented basis for individual accountability.
  Performance agreements can serve as the basis for performance
  evaluations. An assessment of performance against the performance
  agreement can provide TSA and its employees the data needed to better
  achieve organizational goals.

• Maintain continuity of program goals during transitions. Performance
  agreements help to maintain a consistent focus on a set of broad
  programmatic priorities during changes in leadership and organization.
  TSA can use its process for developing performance agreements as a
  tool to communicate priorities and instill those priorities throughout the
  organization during periods of transition.




Page 26                                GAO-03-190 TSA's Results-Oriented Practices
Ensure the permanent performance management system makes
meaningful distinctions in performance. In addition to providing
candid and constructive feedback to help individual employees maximize
their potential in understanding and realizing goals and objectives of the
agency, an effective performance management system provides
management with the objective and fact-based information it needs to
reward top performers and the necessary information and documentation
to deal with poor performers. Under TSA’s interim performance
management system, employee performance is appraised at only two
levels—fully satisfactory and unacceptable. We have observed that such a
pass/fail system does not provide enough meaningful information and
dispersion in ratings to recognize and reward top performers, help
everyone attain their maximum potential, and deal with poor performers.21
As a next step, TSA should consider appraisal systems with more than two
standards of performance. By using its performance agreements as the
basis in making distinctions in performance, TSA can have objective and
fact-based information and the documentation necessary to have an
effective performance management system.

Involve employees in developing its permanent performance
management system. TSA has the opportunity to create a culture that
values the importance of employees to help TSA achieve its goals.
Employee involvement improves the quality of the system by providing a
front line perspective and helping to create organizationwide
understanding and ownership. In addition, even after TSA develops its
permanent performance management system, involving employees in the
process can help employees perceive that the system is fair.

We have identified practices that organizations can apply to further involve
employees.22 The practices TSA can adopt to promote inclusiveness and
encourage employee ownership for the permanent performance
management system include the following.

• Seek employee input. Leading organizations not only provide
  information to employees but also commonly seek their employees’
  input on a periodic basis and explicitly address and use that input to

21
 U.S. General Accounting Office, FBI Reorganization: Initial Steps Encouraging but
Broad Transformation Needed, GAO-02-865T (Washington, D.C.: June 21, 2002).
22
 U.S. General Accounting Office, Human Capital: Practices That Empowered and
Involved Employees, GAO-01-1070 (Washington D.C.: Sept. 14, 2001).




Page 27                                     GAO-03-190 TSA's Results-Oriented Practices
                              adjust their human capital practices. As TSA matures as an organization
                              it can collect feedback using employee satisfaction surveys, focus
                              groups, employee advisory councils, and/or employee task forces.

                           • Involve employees in planning and sharing performance information.
                             Involving employees in the planning process to develop agency goals
                             helps to increase employees’ understanding and acceptance of them and
                             improve motivation and morale. For TSA, employees’ understanding
                             and acceptance of its goals is particularly important because they are to
                             be held accountable for achieving the goals set out in their performance
                             agreements.



Collaboration and          Virtually all of the results that the federal government strives to achieve
Communication to Achieve   require the concerted and coordinated efforts of two or more agencies.
                           Thus, similar to virtually all federal agencies, TSA must collaborate and
National Outcomes
                           communicate with stakeholders within and outside the government to
                           achieve meaningful results, and participate in matrixed relationships—or
                           networks of governmental, private sector, and nongovernmental
                           organizations working together—to achieve its goals. This collaboration
                           and communication will be even more important given the complex nature
                           of national security-related goals.

                           ATSA requires TSA to collaborate and communicate with organizations
                           across the government and in the private sector to accomplish its mission.
                           For example, ATSA requires TSA to do the following.

                           • Work with the Federal Aviation Administration to establish procedures
                             for notifying its Administrator and others of the identity of individuals
                             known to pose, or suspected of posing, a risk of air piracy or terrorism
                             or a threat to airline or passenger safety.

                           • Enter into memorandums of understanding with federal agencies or
                             other entities to share or otherwise cross-check data on individuals
                             identified on federal agency databases who may pose a risk to
                             transportation or national security.

                           • Coordinate with federal agencies and air carriers to require air carriers
                             to use information from government agencies to identify individuals on
                             passenger lists who may be a threat to civil aviation or national security;
                             and if such an individual is identified, notify appropriate law




                           Page 28                                GAO-03-190 TSA's Results-Oriented Practices
     enforcement agencies, prevent the individual from boarding an aircraft,
     or take other appropriate action with respect to that individual.

TSA has established a number of offices to collaborate and communicate
with external stakeholders.

• The Office of Security Regulation and Policy is to coordinate with TSA’s
  offices and stakeholders on policy, rulemaking, and customer service
  issues.

• The Office of Communications and Public Information is to serve as an
  advisor to senior leadership on the public impacts of major policy
  decisions, internal audience concerns, and community reaction to and
  civilian news media interest in TSA missions and functions.

• The Office of Law Enforcement and Security Liaison is to serve as the
  national level liaison with federal, state, and local law enforcement and
  the international community and is to administer TSA’s Freedom of
  Information Act requirement, which allows the public to request
  information about TSA policies, procedures, operations, and decisions,
  among other things and TSA’s Privacy Act requirement, which allows the
  public to request any records that the government has about the
  individual making the request.

• The Office of Legislative Affairs is to be responsible for working and
  communicating with the Congress.

TSA has experienced some challenges with collaboration and
communication. According to TSA officials, TSA is still defining and
clarifying the specific roles and responsibilities of the offices that are to
communicate with stakeholders. As of December 2002, TSA did not have
written guidance to provide information about TSA communication roles
and responsibilities to other TSA employees or to external stakeholders. In
addition, the Under Secretary testified that there were some problems with
reaching stakeholders in the past, specifically the airlines and airports.23
The Under Secretary recognized that collaboration with these and other
stakeholders is important to ensure aviation security and made a personal
commitment that TSA will make a concerted effort to communicate better


23
 Testimony of Admiral James Loy, Acting Under Secretary of Transportation for Security
before the Commerce, Science, and Transportation Committee, U.S. Senate on July 25, 2002.




Page 29                                      GAO-03-190 TSA's Results-Oriented Practices
with stakeholders. In September 2002, we briefed the staff of the
Committee on Transportation and Infrastructure, U.S. House of
Representatives, that some officials at selected airports told us that they
had not received clear and comprehensive guidance from TSA on issues
concerning the feasibility of meeting the baggage screening deadline.

TSA officials that we spoke to are aware of the importance of collaboration
and communication across the government. According to TSA officials, the
primary tools TSA will use to formally collaborate with governmental
entities are memorandums of agreement and memorandums of
understanding. They are developing memorandums of agreement with the
other modal administrations within DOT. TSA officials told us that they
also plan to develop memorandums of agreement and memorandums of
understanding with local law enforcement agencies, the Department of
Defense, the Department of State, the Federal Bureau of Investigation, the
Nuclear Regulatory Commission, the Federal Emergency Management
Agency, and the Customs Service, among others. They told us that the
purposes of the memorandums are to delineate clear lines of authority and
responsibility between parties; improve services to DOT’s modal
administrations, other federal, state, and local agencies, nongovernmental
stakeholders, and the American public; and achieve national performance
security goals, among other purposes. TSA plans to complete the
memorandums no later than March 1, 2003.

As an additional mechanism to facilitate collaboration and communication,
ATSA established the Transportation Security Oversight Board. According
to ATSA, the Board, which must meet at least every 3 months, should
consist of cabinet heads; directors; high-ranking officials and/or their
designees from DOT, the Department of Defense, the Department of
Justice, the Department of the Treasury, and the Central Intelligence
Agency; and presidentially appointed representatives from the National
Security Council and the Office of Homeland Security. The Secretary of
Transportation is to be the chairperson of the Board.24 The Board’s
responsibilities include, among other things, reviewing transportation
plans; facilitating the coordination of intelligence, security, and law
enforcement activities affecting transportation; and facilitating the sharing


24
 The Homeland Security Act of 2002 reestablishes the Board within DHS, replaces the
representative from the Office of Homeland Security with the Secretary of Homeland
Security or the Secretary’s designee, and designates the chairperson of the Board as the
Secretary of Homeland Security.




Page 30                                       GAO-03-190 TSA's Results-Oriented Practices
                            of intelligence, security, and law enforcement information affecting
                            transportation. The Board, established within DOT, met twice in 2002. TSA
                            officials noted that the Board is an excellent mechanism to share
                            information with national security agencies across government and has
                            helped focus the national security community on the threats to the
                            transportation system, which TSA believes is a critical element of meeting
                            the mandates in ATSA.

Recommended Next Steps      Define more clearly the collaboration and communication roles
                            and responsibilities of TSA’s various offices. To help ensure
                            collaboration and communication with stakeholders are consistent and
                            mutually reinforcing, TSA should more fully define and clarify the
                            collaboration and communication responsibilities of the many offices that
                            interact with its stakeholders. TSA should ensure both internal TSA staff
                            and external stakeholders can identify who is responsible for collaboration
                            and communication at TSA.

                            Formalize roles and responsibilities among governmental entities
                            for transportation security. Finalizing memorandums of agreement and
                            memorandums of understanding with the other modal administrations
                            within DOT as well as other government agencies as appropriate can help
                            TSA successfully manage the necessary matrixed relationships to achieve
                            security in all modes of transportation. For example, agreements between
                            TSA and the modal administrations can address such issues as separating
                            responsibilities for standards and regulations, funding, coordinating with
                            customers, and implementing future security initiatives. Although the
                            memorandums may change when TSA moves to DHS, TSA should continue
                            to make progress to formalize its roles and responsibilities until the
                            transition takes place.



Public Reporting and        Federal agencies can promote greater transparency of government by
Customer Service to Build   publicizing what they intend to achieve and by being held accountable for
                            achieving those results. Such transparency can improve the confidence of
Citizen Confidence
                            the American people in the capabilities of the federal government.
                            Improving public confidence is especially critical for TSA as it works to
                            achieve its goals of improving transportation security.

                            ATSA required TSA to issue specific reports to the Congress on its activities
                            and progress in establishing and meeting its goals. Specifically, ATSA
                            required TSA to provide to the Congress, within 180 days of enactment of
                            the legislation, an action plan with goals and milestones that was to outline



                            Page 31                                GAO-03-190 TSA's Results-Oriented Practices
how acceptable levels of performance for aviation security will be
achieved. In accordance with the time frames outlined in ATSA, TSA
submitted the action plan to the Congress on May 19, 2002, and has made
this report available to the public on its Web site. The action plan, entitled
“Performance Targets and Action Plan, 180 Day Report to Congress,” made
public TSA’s strategic and performance goals, TSA’s performance measures,
and the performance measurement information system.

ATSA also required two progress reports within 6 months of the enactment
of the legislation. TSA released these reports within the established time
frame. The first progress report was to describe TSA’s progress to date on
the evaluation and implementation of actions listed in the legislation. TSA
submitted this progress report, entitled “Report to Congress on Enhanced
Security Measures,” on May 19, 2002, and made the report available to the
public on its Web site. Some of the actions TSA reported it was evaluating
include the following.

• Establish a uniform system of identification for all state and local law
  enforcement personnel for use in obtaining permission to carry
  weapons in aircraft cabins and in obtaining access to a secured area of
  an airport.

• Establish requirements to implement trusted passenger programs and
  use available technologies to expedite the security screening of
  passengers who participate in such programs.

• Provide for the use of technologies to enable the private and secure
  communication of threats to aid in the screening of passengers and
  other individuals on airport property who are identified on any state or
  federal security-related database for the purpose of having an integrated
  response of various authorized airport security forces.

The second progress report was to describe the deployment of passenger
and baggage screening systems. TSA submitted this report on May 18, 2002,
and has made nonsensitive portions of the report available on its Web site.
The report, entitled “Deployment of Screening Systems Strategy &
Progress,” provided the Congress with TSA’s progress on and strategy for
meeting the mandated deadlines to deploy federal screeners at security
checkpoints at 429 airports and to have systems in place for screening
every piece of checked baggage for explosives. For example, TSA reported
that at that time it had identified security screener standards; selected
private contractors to recruit, assess, and train security screeners;



Page 32                                GAO-03-190 TSA's Results-Oriented Practices
developed a preliminary plan for deploying federal screeners to the
airports; developed an initial screening checkpoint design; and reviewed
available and emerging explosives detection technology. The report did not
include all of the information required in ATSA. For example, ATSA
required specific information such as the dates of installation of each
system to screen all checked baggage for explosives and the date each
system is operational.

Since TSA has issued the statutorily required action plan and progress
reports, it has continued to publicly report on its progress. Specifically,
TSA created a Web site that provides information for customers and the
public, including updates on its progress toward meeting the deadlines in
ATSA; speeches, statements, and testimonies by TSA and DOT leadership;
information on aviation security technology such as explosives detection
systems; fact sheets on TSA contractors; frequently asked questions related
to TSA’s policies and procedures; information for the traveling public; and
information on employment opportunities with TSA. For example, a private
citizen could find out when TSA would be hiring security screeners at her
or his local airport, how to apply for a position with TSA, and what objects
are prohibited and permitted to be carried onto an airplane.25

In addition, TSA created an Office of Communications and Public
Information. The purpose of this office is to provide information to the
general public concerning TSA, its people, programs, policies, and events.
To facilitate this mission, the Office of Communications and Public
Information maintains a call center to receive and respond to inquiries
from the public. This office also performs a variety of other functions. For
example, the office develops statements, position papers, policy releases,
media alerts, and marketing plans to inform and educate the public.

TSA has taken several actions that are intended to focus on customer
satisfaction and be responsive to customer concerns in delivering critical
and sensitive services. TSA established an ombudsman position to, among
other things, serve external customers. Specifically, TSA’s ombudsman is
responsible for recommending and influencing systemic change where
necessary to improve TSA operations and customer service. As of
November 2002, TSA is recruiting to fill this position. We have reported that
through the impartial and independent investigation of citizens’
complaints, federal ombudsmen help agencies be more responsive to the


25
     See www.tsa.gov.




Page 33                                GAO-03-190 TSA's Results-Oriented Practices
public, including people who believe their concerns have not been dealt
with fairly or fully through normal channels. 26 Ombudsmen may
recommend ways to resolve individual complaints or more systematic
problems, and may help to informally resolve disagreements between the
agency and the public.

In addition, TSA is tracking performance on its customer service. For
example, TSA’s primary performance measure for customer satisfaction is
the average wait time and percentage of passenger complaints per 1,000
passengers.27 Other measures to gauge customer satisfaction include the
percentage of flights delayed due to security issues, the percentage of
incidents/interventions per 1,000 passengers, the number of weapons
seized per 1,000 passengers, and the number of seats delayed due to
security issues, among others.

As part of its ongoing challenge to balance security against customer
service, TSA is reviewing existing security procedures in order to eliminate
those that do not enhance security or customer service. For example, the
Under Secretary testified that TSA has recently eliminated two procedures
to reduce customers’ “hassle factor” at airports. In August 2002, TSA
allowed passengers to carry beverages in paper or foam polystyrene
containers through walk-through metal detectors and prohibited screeners
from asking passengers to drink or eat from any containers of food or liquid
as a security clearance procedure. TSA also eliminated the requirement for
the airlines to ask a series of security-related questions to customers at
check-in. In addition, TSA recently lifted the existing rule that prohibits
parking within 300 feet of airport terminals. TSA has replaced this rule with
parking security measures specific to each airport and linked to the
national threat level.

Lastly, TSA is also planning to create a customer satisfaction index (CSI)
for aviation operations, which includes collecting customer information
from national polls, passenger surveys at airports, the TSA call center, and
customer feedback at airports. TSA intends to use data from the CSI to


26
 U.S. General Accounting Office, Environmental Protection: Issues for Consideration in
the Reorganization of EPA’s Ombudsman Function, GAO-02-859T (Washington, D.C.:
June 25, 2002).
27
 TSA reports that, at airports where data are available, it met DOT’s performance goal that
95 percent of passengers wait less than 10 minutes to pass through airport checkpoints
through October 2002.




Page 34                                       GAO-03-190 TSA's Results-Oriented Practices
                         improve performance. As a first step, TSA conducted 12 focus groups with
                         air travelers to help it understand the aspects of customer experiences that
                         influence satisfaction with and confidence in aviation security. TSA learned
                         from the focus groups that:

                         • the federalization of aviation security significantly increased the
                           confidence of passengers;

                         • key attributes that drive increased satisfaction and confidence include
                           attentiveness of screeners, thoroughness of the screening process,
                           professionalism of the workforce, and consistency of the process across
                           airports;

                         • wait time was not a significant driver of satisfaction, and participants
                           said they would be willing to wait longer if they thought it would make
                           them more secure;

                         • the lack of checked baggage screening reduces confidence; and

                         • secondary screening processes are a significant driver of reduced
                           satisfaction.

                         The results of the focus groups will help TSA develop the passenger
                         surveys to be used to collect data for the CSI. TSA intends to implement the
                         CSI for aviation operations in 2003 and to expand the CSI to include other
                         stakeholders, such as airport operators, air carriers, and customers of
                         other modes of transportation.

Recommended Next Steps   Fill the ombudsman position to facilitate responsiveness of TSA to
                         the public. To ensure TSA is as responsive to the public as possible and is
                         able to identify and resolve individual complaints and systematic problems,
                         TSA should fill its ombudsman position as soon as high quality candidates
                         can be identified.

                         Continue to develop and implement mechanisms, such as the CSI,
                         to gauge customer satisfaction and improve customer service. TSA
                         has identified customer satisfaction as one of its three annual performance
                         goals. By combining data on its service delivery from a number of sources,
                         such as the CSI, TSA will be able obtain a robust picture of customer
                         satisfaction, which can be used to improve performance. TSA should
                         complete the planning and developing of the CSI and begin its
                         implementation.



                         Page 35                                GAO-03-190 TSA's Results-Oriented Practices
Concluding            Never has a results-oriented focus been more critical than today, when the
                      security of America’s citizens depends so directly and immediately on the
Observations          results of many federal programs. TSA has faced immense challenges in its
                      first year of existence to build the infrastructure of a large organization and
                      meet mandated deadlines to federalize aviation security. As TSA begins to
                      take responsibility for security in the maritime and surface modes of
                      transportation, its current and future challenge is to build, sustain, and
                      institutionalize the organizational capacity to help it achieve its current and
                      future goals. As TSA moves into the newly created DHS, TSA has an
                      opportunity to continue to foster a results-oriented culture. In this regard,
                      TSA has started to put in place the foundation of this results-oriented
                      culture through

                      • leadership commitment to creating a high-performing organization,

                      • strategic planning to establish results-oriented goals and measures,

                      • performance management to promote accountability for results,

                      • collaboration and communication to achieve national outcomes, and

                      • public reporting and customer service to build citizen confidence.

                      This foundation can serve TSA well in DHS and help TSA to focus on and
                      achieve its mission to protect the nation’s transportation systems to ensure
                      freedom of movement for people and commerce.



Recommendations for   We recommend that the Secretary of Transportation, in conjunction with
                      the Under Secretary of Transportation for Security, continue TSA’s
Executive Action      leadership commitment to creating a high-performing organization that
                      includes next steps to establish a performance agreement for the Under
                      Secretary that articulates how bonuses will be tied to performance and to
                      add expectations in performance agreements for top leadership to foster
                      the culture of a high-performing organization.




                      Page 36                                 GAO-03-190 TSA's Results-Oriented Practices
                  We recommend that the Under Secretary of Transportation for Security
                  take the next steps to continue to implement the following results-oriented
                  practices.

                  • Strategic planning to establish results-oriented goals and measures that
                    includes next steps to establish security performance goals and
                    measures for all modes of transportation as part of a strategic planning
                    process that involves stakeholders and to apply practices that have been
                    shown to provide useful information in agency performance plans.

                  • Performance management to promote accountability for results that
                    includes next steps to build on the current performance agreements to
                    achieve additional benefits, to ensure the permanent performance
                    management system makes meaningful distinctions in performance, and
                    to involve employees in developing its performance management
                    system.

                  • Collaboration and communication to achieve national outcomes that
                    includes next steps to define more clearly the collaboration and
                    communication roles and responsibilities of TSA’s various offices and to
                    formalize roles and responsibilities among governmental entities for
                    transportation security.

                  • Public reporting and customer service to build citizen confidence that
                    includes next steps to fill the ombudsman position to facilitate
                    responsiveness of TSA to the public and to continue to develop and
                    implement mechanisms, such as the CSI, to gauge customer satisfaction
                    and improve customer service.



Agency Comments   We provided drafts of this report in December 2002 to officials from DOT,
                  including TSA, for their review and comment. TSA’s Director of Strategic
                  Management and Analysis provided oral comments on behalf of DOT and
                  TSA generally agreeing with the contents, findings, and recommendations
                  of the draft report. TSA’s Director of Strategic Management and Analysis
                  provided minor technical clarifications and we made those changes where
                  appropriate. In addition, she provided updated information on TSA’s




                  Page 37                               GAO-03-190 TSA's Results-Oriented Practices
progress in its strategic planning, collaboration and communication, and
customer service since the completion of our audit work. We added that
information where appropriate.


As agreed with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report for 30 days from the
date of this letter. At that time, we will provide copies of this report to the
Secretary of Transportation, the Under Secretary of Transportation for
Security, the Director of the Office of Homeland Security, the Director of
the Office of Personnel Management, and the Director of the Office of
Management and Budget. We will also make copies available to others
upon request. In addition, the report will be available at no charge on the
GAO Web site at http://www.gao.gov.

If you have any questions concerning this report, please contact me or Lisa
Shames on (202) 512-6806. Marti Tracy was a key contributor to this report.




J. Christopher Mihm
Director, Strategic Issues




Page 38                                 GAO-03-190 TSA's Results-Oriented Practices
Appendix I

Objective, Scope, and Methodology                                                              AA
                                                                                                ppp
                                                                                                  ep
                                                                                                   ned
                                                                                                     n
                                                                                                     x
                                                                                                     id
                                                                                                      e
                                                                                                      x
                                                                                                      Iis




              The objective of our review was to describe the Transportation Security
              Administration’s (TSA) actions and plans for implementing the results-
              oriented practices required in the Aviation and Transportation Security Act
              (ATSA) and recommend next steps for TSA to build a results-oriented
              organizational culture and to establish a positive control environment. To
              identify results-oriented practices and recommend next steps, we reviewed
              our models, guides, reports, and other products on strategic planning and
              performance measurement, strategic human capital management,
              transformation efforts, and other related areas. See related GAO products
              listed at the end of this report for a list of our products in these areas. We
              next analyzed ATSA in relation to our products to identify any results-
              oriented practices that were statutorily required in the legislation. In
              addition, we reviewed TSA and Department of Transportation missions,
              performance goals and measures, performance agreements, policies and
              procedures, and organizational charts and other relevant documentation.
              To describe TSA’s status in implementing these results-oriented practices,
              we interviewed 25 officials from various TSA offices including strategic
              planning, human capital, training, budget, public affairs, and policy, among
              others. We also visited Baltimore-Washington International airport after it
              was transitioned to federal control to talk to front-line managers about
              their responsibilities and specifically their role in providing performance
              data to headquarters. We developed the recommended next steps by
              referring to our models, guides, reports, and other products on results-
              oriented practices and identifying additional practices that were associated
              with and would further complement or support current TSA efforts. We
              performed our work from May through September 2002 in accordance with
              generally accepted government auditing standards.




              Page 39                                GAO-03-190 TSA's Results-Oriented Practices
Related GAO Products


                             The following list provides information on recent GAO products related to
                             the Transportation Security Administration (TSA), transportation security,
                             and the results-oriented practices discussed in this report. These and other
                             GAO products can be found at www.gao.gov.



TSA and Transportation       Mass Transit: Federal Action Could Help Transit Agencies Address
Security                     Security Challenges. GAO-03-263. Washington, D.C.: December 13, 2002.

                             Port Security: Nation Faces Formidable Challenges in Making New
                             Initiatives Successful. GAO-02-993T. Washington, D.C.: August 5, 2002.

                             Aviation Security: Transportation Security Administration Faces
                             Immediate and Long-Term Challenges. GAO-02-971T. Washington, D.C.:
                             July 25, 2002.

                             Aviation Security: Information Concerning the Arming of Commercial
                             Pilots. GAO-02-822R. Washington, D.C.: June 28, 2002.

                             Aviation Security: Deployment and Capabilities of Explosive Detection
                             Equipment. GAO-02-713C. Washington, D.C.: June 20, 2002. (CLASSIFIED)



Leadership Commitment to     Highlights of a GAO Forum: Mergers and Transformation: Lessons
Creating a High-Performing   Learned for a Department of Homeland Security and Other Federal
                             Agencies. GAO-03-293SP. Washington, D.C.: November 14, 2002.
Organization
                             Highlights of a GAO Roundtable: The Chief Operating Officer Concept: A
                             Potential Strategy to Address Federal Governance Challenges. GAO-03-
                             192SP. Washington, D.C.: October 4, 2002.

                             Managing for Results: Using Strategic Human Capital Management to
                             Drive Transformational Change. GAO-02-940T. Washington, D.C.: July 15,
                             2002.

                             Managing for Results: Federal Managers’ Views Show Need for Ensuring
                             Top Leadership Skills. GAO-01-127. Washington, D.C.: October 20, 2000.

                             Management Reform: Elements of Successful Improvement Initiatives.
                             GAO/T-GGD-00-26. Washington, D.C.: October 15, 1999.




                             Page 40                               GAO-03-190 TSA's Results-Oriented Practices
                             Related GAO Products




Strategic Planning to        Performance Reporting: Few Agencies Reported on the Completeness and
Establish Results-Oriented   Reliability of Performance Data. GAO-02-372. Washington, D.C.: April 26,
                             2002.
Goals and Measures
                             Agency Performance Plans: Examples of Practices That Can Improve
                             Usefulness to Decisionmakers. GAO/GGD/AIMD-99-69. Washington, D.C.:
                             February 26, 1999.

                             Agencies’ Annual Performance Plans Under the Results Act: An
                             Assessment Guide to Facilitate Congressional Decisionmaking.
                             GAO/GGD/AIMD-10.1.18. Washington, D.C.: February 1998.

                             Managing For Results: Enhancing the Usefulness of GPRA Consultations
                             Between the Executive Branch and Congress. GAO/T-GGD-97-56.
                             Washington, D.C.: March 10, 1997.

                             Agencies’ Strategic Plans Under GPRA: Key Questions to Facilitate
                             Congressional Review. GAO/GGD-10.1.16. Washington, D.C.: May 1997.

                             Executive Guide: Effectively Implementing the Government Performance
                             and Results Act. GAO/GGD-96-118. Washington, D.C.: June 1996.



Performance Management       Results-Oriented Cultures: Using Balanced Expectations to Manage
to Promote Accountability    Senior Executive Performance. GAO-02-966. Washington, D.C.:
                             September 27, 2002.
for Results
                             Results-Oriented Cultures: Insights for U.S. Agencies from Other
                             Countries’ Performance Management Initiatives. GAO-02-862.
                             Washington, D.C.: August 2, 2002.

                             A Model of Strategic Human Capital Management. GAO-02-373SP.
                             Washington, D.C.: March 15, 2002.

                             Human Capital: Practices That Empowered and Involved Employees.
                             GAO-01-1070. Washington, D.C.: September 14, 2001.

                             Managing for Results: Emerging Benefits From Selected Agencies’ Use of
                             Performance Agreements. GAO-01-115. Washington, D.C.: October 30,
                             2000.




                             Page 41                             GAO-03-190 TSA's Results-Oriented Practices
                            Related GAO Products




                            Human Capital: Using Incentives to Motivate and Reward High
                            Performance. GAO/T-GGD-00-118. Washington, D.C.: May 2, 2000.



Collaboration and           Homeland Security: Effective Intergovernmental Coordination Is Key to
Communication to Achieve    Success. GAO-02-1011T. Washington, D.C: August 20, 2002.
National Outcomes           Homeland Security: Intergovernmental Coordination and Partnership
                            Will Be Critical to Success. GAO-02-900T. Washington, D.C.: July 2, 2002.

                            Managing for Results: Barriers to Interagency Coordination. GAO/GGD-
                            00-106. Washington, D.C.: March 29, 2000.

                            Managing For Results: Using the Results Act to Address Mission
                            Fragmentation and Program Overlap. GAO/AIMD-97-146. Washington,
                            D.C.: August 29, 1997.



Public Reporting and        Managing for Results: Using GPRA to Assist Oversight and
Customer Service to Build   Decisionmaking. GAO-01-872T. Washington, D.C.: June 19, 2001.
Citizen Confidence
                            Human Capital: The Role of Ombudsmen in Dispute Resolution.
                            GAO-01-466. Washington, D.C.: April 13, 2001.

                            Managing for Results: The Statutory Framework for Performance-Based
                            Management and Accountability. GAO/GGD/AIMD-98-52. Washington,
                            D.C.: January 28, 1998.




(450146)                    Page 42                               GAO-03-190 TSA's Results-Oriented Practices
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