oversight

Observations on the National Aeronautics and Space Administration's Fiscal Year 2000 Performance Plan

Published by the Government Accountability Office on 1999-07-20.

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

United States General Accounting Office                                                  National Security and
Washington, D.C. 20548                                                            International Affairs Division




                 B-279979

                 July 20, 1999

                 The Honorable Dick Armey
                 Majority Leader
                 House of Representatives

                 The Honorable Dan Burton
                 Chairman, Committee on Government Reform
                 House of Representatives

                 The Honorable Fred Thompson
                 Chairman, Committee on Governmental Affairs
                 United States Senate

                 Subject: Observations on the National Aeronautics and Space Administration’s Fiscal Year
                 2000 Performance Plan

                 As you requested, we have reviewed and evaluated the fiscal year 2000 performance plans for
                 the 24 Chief Financial Officers (CFO) Act agencies that were submitted to Congress as
                 required by the Government Performance and Results Act of 1993 (Results Act). Enclosure I
                 to this letter provides our observations on the fiscal year 2000 performance plan for the
                 National Aeronautics and Space Administration (NASA). Enclosure II lists management
                 challenges we and NASA’s Inspector General identified that face the agency and the
                 applicable goals and measures in the fiscal year 2000 annual performance plan. Enclosure III
                 is NASA’s comments.

                 Our objectives were to (1) assess the usefulness of the agency’s plan for decisionmaking and
                 (2) identify the degree of improvement the agency’s fiscal year 2000 performance plan
                 represents over the fiscal year 1999 plan. Our observations were generally based on the
                 requirements of the Results Act, guidance to agencies from the Office of Management and
                 Budget (OMB) for developing the plan (OMB Circular A-11, Part 2), our previous reports and
                 knowledge of NASA’s operations and programs, and our observations on NASA’s fiscal year




                 Page 1                                   GAO/NSIAD-99-186R NASA’s Fiscal Year 2000 Performance Plan
B-279979


1999 performance plan. Our summary report on the CFO Act agencies’ fiscal year 2000 plans
                                                                          1
contains a complete discussion of our objectives, scope, and methodology.

As agreed, unless you announce the contents of this letter earlier, we plan no further
distribution until 30 days from the date of the letter. The major contributors to this report are
listed in enclosure IV. Please call me on (202) 512-4841 if you or your staff have any questions.




Allen Li
Associate Director, Defense
    Acquisitions Issues

Enclosures - 4




1
 Managing for Results: Opportunities for Continued Improvements in Agencies’ Performance Plans (GAO/GGD/AIMD-99-215,
July 20, 1999).




Page 2                                               GAO/NSIAD-99-186R NASA’s Fiscal Year 2000 Performance Plan
Enclosure I

Observations on the National
Aeronautics and Space
Administration's Performance Plan
for Fiscal Year 2000
The National Aeronautics and Space Administration’s (NASA) fiscal year 2000 annual
performance plan should be useful to decisionmakers. It provides a limited picture of
intended performance across the agency, a general discussion of strategies and resources the
agency will use to achieve its goals, and limited confidence that performance information will
be credible. An example of a positive change regarding the plan’s presentation of strategies
and goals is the discussion on NASA’s objective of extending the use of Earth Science
research for national, state, and local application. The plan links that objective with the
achievement of three performance goals, namely having at least one Regional Earth Science
Application become self-sustaining; developing at least two new data products for routine
decision-making by user organizations; and implementing at least 5 joint applications
research projects/partnerships with state and local governments in remote sensing
applications. Figure 1 highlights the plan’s major strengths and key weaknesses as NASA
seeks to make additional improvements to its plan.

Figure 1: Major Strengths and Key Weaknesses of Fiscal Year 2000 Annual Performance Plan

Major Strengths
• Shows how budgetary resources are related to performance
• Provides expanded detail on performance evaluations and identifies specific data sources

Key Weaknesses
• Does not provide clear rationale for how information technology related strategies and
programs contribute to achievement of performance goals
• Does not include procedures for verifying and validating performance data

NASA’s fiscal year 2000 plan represents a moderate improvement over the fiscal year 1999
plan in that it indicates some degree of progress in addressing the weaknesses identified in
our assessment of the fiscal year 1999 plan. In reviewing the fiscal year 1999 plan, we
observed that the plan could have provided a clearer picture of intended performance across
the agency, did not fully portray how strategies and resources would help achieve
performance goals, and partially provided confidence that performance information would be
credible. Among improvements in the fiscal year 2000 plan is the inclusion of (1) performance
objectives or targets that fully or partially address 5 of 10 management challenges identified
by NASA’s Office of the Inspector General or us, (2) a crosswalk to relate budget categories
with performance objectives and targets, and (3) expanded detail on internal and external
evaluations of performance.




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Enclosure I
Observations on the National Aeronautics and Space Administration's Performance Plan for Fiscal Year 2000




NASA’s Performance Plan Provides a Limited Picture of
Intended Performance Across the Agency
The plan provides a limited picture of intended performance across the agency. The plan
includes performance goals and objectives that are results oriented, including the provision
of performance objectives and measures that address important dimensions of program
performance and balance competing priorities. Although the plan includes some performance
objectives and targets that address mission-critical management problems, the plan does not
address all major management challenges identified by NASA’s Office of Inspector General
and us. It attempts to address issues of broad national concern but needs more specific
information on how achieving the agency’s goals will contribute to addressing these issues.

The plan includes performance goals and objectives that are results oriented. Some of these
goals and measures address important dimensions of program performance and balance
competing priorities. For example, NASA’s objective of providing safe and affordable access
to space is measured by safety and mission-related performance targets, namely achieving
seven or fewer anomalies per Space Shuttle mission while attaining 85 percent on-time,
successful launches.

While the plan includes some performance objectives and targets that address mission-
critical management problems, it does not address all 10 of the major management challenges
that NASA’s Inspector General and we identified. The plan includes performance objectives
or targets that fully or partially address 5 of the 10 management challenges. Table 1 (in the
section on management challenges) shows our analysis of major management challenges and
performance objectives in the plan. As an example, we reported that contract management is
a continuing area of high risk and that until NASA’s financial management system is
operational, performance assessments relying on cost data may be incomplete. NASA’s plan
addresses this issue by establishing a performance target to implement new financial systems
and business procedures, including the installation of its Integrated Financial Management
System.

The plan attempts to address crosscutting issues of broad national concern, but at a very high
level. For example, the plan states that the outcomes of its activities contribute significantly
to the achievement of America’s goals in key areas. The key area of economic growth and
security is then linked with NASA’s aeronautics and space research and development of
technology. NASA’s stated desired outcome is to keep America capable and competitive. The
addition of more detailed information on how NASA’s efforts toward achieving this goal will
contribute to economic growth, such as referring to the collaborative work on engine
development by NASA and private industry, would enhance the understanding of linkages.

The fiscal year 2000 performance plan indicates some degree of progress in addressing the
weaknesses that we identified in our assessment of the fiscal year 1999 performance plan as




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Enclosure I
Observations on the National Aeronautics and Space Administration's Performance Plan for Fiscal Year 2000




it relates to providing a clear picture of intended performance across the agency. Specifically,
in analyzing the fiscal year 1999 plan, we said that the plan could be improved by (1)
acknowledging major management challenges and associated corrective actions and, (2)
identifying activities that had been undertaken to address issues of broad national concern
and the contribution of the agency’s goals toward addressing such crosscutting activities.
NASA’s final fiscal year 1999 performance plan (which was issued after our assessment of the
version provided to Congress) and NASA’s fiscal year 2000 performance plan address some of
                                       1
the weaknesses we cited previously. Specifically, the final fiscal year 1999 performance plan
added performance targets to address two of the three major management challenges that we
identified, and one of those two appears in the fiscal year 2000 performance plan. NASA
officials indicated that the remaining management challenge did not appear in the fiscal year
2000 plan because remedial action on it would be completed in fiscal year 1999. A third
management challenge that we identified—cooperation between the Department of Defense
and NASA on using aerospace testing facilities—does not appear in either plan. Although
NASA officials said that they did not specifically attempt to address the major management
challenges identified by NASA’s Office of Inspector General, the fiscal year 2000 plan does
include performance objectives or targets that relate to some of these management
challenges. For example, the Office of Inspector General reported that ensuring the
availability of launch vehicles presented challenges. These challenges included (1) ensuring
the availability of small expendable launch vehicles so that milestones can be met and NASA
missions are cost-effective and (2) evaluating whether NASA’s providing the majority of
development funds and assigning technology rights to its industry partners in the
development of the new reusable launch vehicles is in the best interest of the government.
The plan includes an objective related to this challenge that NASA’s plan characterizes as
revolutionizing space launch capabilities. Specifically, it provides a performance target to
begin and complete flight testing of the X-33 in fiscal year 2000 to demonstrate technologies
required for future reusable launch vehicles. NASA officials also noted that while there was
no conscious effort not to acknowledge the management challenges, NASA was still
struggling with how to package that issue in its performance plan.

NASA’s Performance Plan Provides a General Discussion of the
Strategies and Resources It Will Use to Achieve Its Goals
The plan provides a general discussion of strategies and resources the agency will use to
achieve performance goals. The plan provides a crosswalk that relates enterprises,
performance objectives and targets to the program activities in the President’s budget request


1
 NASA issued its final fiscal year 1999 performance plan in February 1999. NASA officials said that the plan was updated to
reflect fiscal year 1999 appropriations and programmatic changes and changes made to respond to concerns expressed by
outside reviewers.




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Enclosure I
Observations on the National Aeronautics and Space Administration's Performance Plan for Fiscal Year 2000




and to the budget categories used in the congressional budget justification; more completely
discusses resources, with the addition of civil service staffing levels for each enterprise; and
provides a limited discussion of external factors that could influence the successful
achievement of performance results. However, the plan still does not adequately describe
how the agency’s strategies and resources will help it achieve performance goals, including a
clear rationale for how information technology-related strategies and programs will
contribute to the achievement of performance goals.

NASA’s plan explicitly states that the plan is intended to be used in conjunction with the
congressional budget justification, and the plan does relates performance objectives and
targets to budget categories. The plan adds a crosswalk that links strategic objectives and
performance targets to the budget categories used in NASA’s congressional budget
justification. This crosswalk indicates that NASA’s performance targets cover the program
activities in its budget justification. For example, in discussing NASA’s objective of extending
the use of Earth Science research for national, state, and local applications, the plan relates
this objective and associated resources (identified in the budget justification) to its strategic
goal of enabling the productive use of Earth Science and technology in the public and private
sectors. The plan links the objective with the achievement of three performance goals,
namely having at least one Regional Earth Science Application become self-sustaining;
developing at least two new data products for routine decision-making by user organizations;
and implementing at least 5 joint applications research projects/partnerships with state and
local governments in remote sensing applications.

Although this linkage is a step in the right direction, the absence of funding information for
the budget categories makes it difficult to easily relate requested funding needs to the
performance objectives and targets. Including these funding needs in the performance plan
would permit decisionmakers to more readily compare planned levels of accomplishment
with budget resources. Also, the plan would be more useful if NASA had provided the
meaning and significance of the primary and secondary contribution notations in the
crosswalk and an explanation of acronyms used in the crosswalk to identify other objectives
addressed by the performance targets. NASA recognizes that its performance plan and budget
justification need to be integrated to better relate the performance goals, objectives, and
measures. According to agency officials, NASA was studying the benefits of merging these
documents.

The plan’s use of performance target descriptions and numbers, the crosswalk, and the
narrative were found to be consistent in all of the enterprise sections except in the Space
Science Enterprise section. However, to minimize repetition, the plan could be streamlined
by referencing key targets in the narrative and leaving detailed information in the crosswalk.

The plan provides a more complete discussion of resources with the addition of civil service
staffing levels for each enterprise. However, there is no further description of NASA’s human




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Enclosure I
Observations on the National Aeronautics and Space Administration's Performance Plan for Fiscal Year 2000




capital needs beyond this discussion. For example, skills and training needed to meet
performance goals are not addressed. In addition, the plan still does not adequately describe
how the agency’s strategies and resources will help it achieve performance goals. Generally,
implementation strategies have not changed from the fiscal year 1999 plan and still lack
specific information on how NASA will accomplish its enterprise goals. In several instances,
these descriptions outline philosophies rather than describe enabling actions. For instance,
the plan still does not clearly explain application of the “faster, better, cheaper” approach to
spacecraft development in the Space Science and Earth Science implementation strategy
sections. At a minimum, it would have been helpful if the plan had been updated to include an
explicit discussion of what is involved in applying the “faster, better, cheaper” approach and
how the establishment of “prudent risk” is part of it.

NASA officials responded that the performance plan is intended to be used in conjunction
with the NASA fiscal year 2000 congressional budget justification and noted that each of the
entries in the budget justification identifies resources, goals, and the strategies being pursued
in the implementation of those goals. While the scope of our analysis did not include a full
analysis of NASA’s fiscal year 2000 budget justification, we found the information provided in
that document not to be useful in further explaining implementation strategies referenced in
the performance plan. As indicated earlier, NASA officials said that the agency is studying the
benefits of merging the performance plan and the congressional budget justification in part to
address the strategies and resources issue.

Relative to information technology (IT), the plan generally does not provide a clear rationale
for how IT-related strategies and programs will contribute to the achievement of its
performance goals, nor does it show the allocation of IT-related dollars and personnel to
performance goals. The plan states that costs for mission-unique IT support are incorporated
in program and project budgets. Therefore, they are not identified as separate items.
Furthermore, we believe that the plan is unrealistic in its discussion of how the Earth
Observing System Data and Information System (EOSDIS), an IT-related resource, will
contribute to the achievement of NASA’s performance goal of increasing the number of
products delivered from its archive and make the data available to users more rapidly in fiscal
year 2000. NASA has already testified before Congress that repairing the problems with
EOSDIS that resulted in the delay of the launch of the AM-1 satellite and staying within
budget will require scaling back some of the system’s capabilities.

The plan provides additional context regarding anticipated performance by including a brief
discussion of external factors that could influence the successful achievement of
performance results. For example, the plan states that the successful execution of NASA’s
strategic goals and objectives is contingent on receipt of the requested appropriations, and
the provision of funds, materials, or services that have been committed to the cooperative
agreements or partnerships that are referenced in the plan. However, the value of the plan
would be augmented if (1) external factors were explicitly discussed relative to objectives




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Enclosure I
Observations on the National Aeronautics and Space Administration's Performance Plan for Fiscal Year 2000




whose attainment is strongly tied to these external influences and (2) NASA explained how it
would mitigate any negative effects.

The fiscal year 2000 performance plan indicates some degree of progress in addressing the
weaknesses that we identified in our assessment of the fiscal year 1999 performance plan as
it relates to providing a specific discussion of strategies and resources the agency will use to
achieve performance goals. In reviewing the fiscal year 1999 plan, we observed that the plan
(1) did not clearly associate performance goals and measures with program activities,
including not providing a crosswalk to facilitate an understanding of the relationship between
the specific program activities in the budget and the goals and measures in the performance
plan; (2) partially discussed the resources the agency would use to achieve the performance
goals; (3) did not fully describe how the agency would achieve its performance goals or
reference other documents to show how the strategies would contribute to achieving the
performance goals; (4) did not address any of the important IT management issues or include
a discussion of the agency’s strategy for achieving improvements in IT capability and
services; and (5) could have provided additional context through a discussion of external
factors and the agency’s plan for mitigating or using the identified factors to achieve
performance goals. The fiscal year 2000 plan shows some progress in addressing weaknesses
that we identified. For example, the plan provides a crosswalk that relates enterprises,
performance objectives and targets to the program activities in the President’s budget request
and to the budget categories in the congressional budget justification. In addition, the plan
provides a more complete discussion of resources with the addition of civil service staffing
levels for each enterprise.

The Agency’s Performance Plan Provides Limited Confidence
That Agency Performance Information Will Be Credible
The plan provides limited confidence that the agency’s performance information will be
credible. The plan identifies internal and external organizations that will evaluate
performance, provides expanded detail on such evaluations, and identifies specific internal
and external sources for data. However, it does not include an explicit discussion of
procedures that will be used to verify and validate performance data. Furthermore, the plan
does not address possible limitations in internal and external sources of data.

The plan states that through internal and external processes NASA will evaluate performance
and that these reviews will provide an opportunity to verify and validate performance data
provided by implementing organizations. The plan provides expanded detail on such
evaluations. In addition to naming the specific internal and external entities that will evaluate
performance, such as the Board of Directors of the Office of Life and Microgravity Sciences
and Applications, the plan identifies specific internal and external sources for the data. By
identifying relevant data sources, decisionmakers can be informed of the agency’s actions to




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Enclosure I
Observations on the National Aeronautics and Space Administration's Performance Plan for Fiscal Year 2000




measure performance. For example, the plan states that NASA’s Earth Science Enterprise
will use a database to track the monthly performance for each specific fiscal year 2000
performance target; this data will help the Enterprise focus on targets that need
improvement. Enterprise officials told us that target achievability is rated red if the target is
at risk of not achieving performance results; yellow if there are concerns and issues that need
to be resolved; or green if the target is on track. Enterprise officials told us that this
management tool is already being used.

However, the plan does not include an explicit discussion of procedures that will be used to
verify and validate performance data, nor does it address limitations to the data from internal
or external sources. NASA officials said that established processes have no known limitations
and they consider the issue to be adequately addressed in that the plan explicitly states that
internal management processes provide appropriate forums for reporting and reviewing of
project and program performance data; the recent streamlining of agency processes provide
confidence that new data collection and oversight processes need not be created for
compliance with the Results Act and NASA’s mission-oriented organizational structure and
established management processes are well-suited for this type of performance evaluation;
and a significant in-place external review process involves a peer review process as a key
element to ensure that science research proposals are selected strictly on the merits of the
planned research.

While NASA is confident that established processes have no known data limitations,
identification of possible limitations could permit it to identify actions that might compensate
for events that could negatively affect achievement of performance goals. For example,
evaluation of NASA’s performance objective of improving effectiveness and efficiency of
agency acquisitions is dependent on data from the agency’s Financial Accounting and
Contractual Status system. Based on the problems NASA has encountered in producing
complete cost data, uncertain reliability or unavailability of data from this system needs to be
considered. We previously reported that until the new Integrated Financial Management
                                                                                             2
System is operational, performance assessments relying on cost data might be incomplete.
To NASA’s credit, the agency has recognized the importance of this data. The fiscal year 2000
plan includes a performance target to implement new financial systems and business
procedures (including a new financial classification structure and full cost budgeting and
accounting procedures) through the introduction and installation of the Integrated Financial
Management System. The plan states that following completion of system testing, the agency
will begin to install the system at NASA headquarters and field centers. Consideration of data
limitations needs to extend to external data sources as well. NASA’s performance plan does


2
 Major Management Challenges and Program Risks: National Aeronautics and Space Administration (GAO/OCG-99-18, January
1999).




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Enclosure I
Observations on the National Aeronautics and Space Administration's Performance Plan for Fiscal Year 2000




not specifically address data limitations of externally provided data, such as quality, validity,
and timeliness. For example, NASA will rely on Federal Aviation Administration data to
ascertain whether its goal of increasing operations throughput was achieved.

The fiscal year 2000 plan shows some degree of progress in addressing the weaknesses
identified in our assessment of the fiscal year 1999 plan as it relates to providing full
confidence that the agency’s performance information will be credible. In reviewing the fiscal
year 1999 plan, we observed that the plan did not (1) include a discussion of the procedures
that would be used to verify and validate performance data and (2) address limitations to the
data from internal or external sources. Among improvements in the fiscal year 2000 plan are
(1) expanded detail on internal and external evaluations, (2) identification of specific internal
and external sources for data, and (3) identification of planned action to complete testing and
begin installation of the Integrated Financial Management System at NASA headquarters and
field centers in fiscal year 2000.

Other Observations
NASA is making inroads in ensuring that its strategic management system—which includes
its strategic and annual performance plans and budget justification—is reflective of current
conditions and agency priorities. NASA revised its 1998 strategic plan with interim
adjustments released as part of the fiscal year 2000 performance plan and plans to release a
fully updated strategic plan before September 2000. NASA will also issue a revised fiscal year
2000 performance plan, if required. Although we understand NASA’s rationale for wanting to
reflect programs for which appropriations were made and not requested, NASA’s updated
plans applicable to the current fiscal year will be most useful to decisionmakers if they reflect
progress NASA already has made in meeting goals in its prior fiscal year plan. For example,
the final version of the fiscal year 1999 plan indicates, within the “Manage Strategically” goal,
a performance target to “enhance contract management through improved systems and
information for monitoring and through an emphasis on training of procurement personnel,
and revise metrics to assess the overall health of the procurement function.” Since the target
is to be achieved in fiscal year 1999, it is not included in the fiscal year 2000 plan. Using only
the fiscal year 1999 plan as a basis for comparison, decisionmakers are unaware of NASA’s
positive action. To address this issue, future performance plans could be enhanced with the
inclusion of an appendix summarizing adjustments made to the prior fiscal year plan but no
longer applicable to the current fiscal year.

Agency Comments
In commenting on a draft of our analysis, NASA’s Associate Deputy Administrator stated that
it would endeavor to use our observations in improving the management of the agency. NASA
raised concern about three issues that we identified in our analysis. First, the agency stated




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Observations on the National Aeronautics and Space Administration's Performance Plan for Fiscal Year 2000




that the report containing the OIG’s management challenges was issued subsequent to
NASA’s formulation, selection, and submittal of its performance targets to the Office of
Management and Budget (OMB). NASA contends that the OIG’s management challenges were
identified too late to enable inclusion in the performance plan. Our point concerning this
matter is that NASA did not recognize and address longstanding major management issues
that the agency knew about or should have known about. The OIG had identified similar
challenges in a report to Senator McCain in 1997. These issues should have been addressed in
the plan upon submittal to OMB.

Second, in response to our criticism that the plan did not include an explicit discussion of
external factors that could impact attainment of the plan’s performance objectives, NASA
stated that OMB Circular A-11 allows agencies to choose to include external factors in their
plans when these may bear directly on goal achievement for the fiscal year covered. NASA is
correct in its interpretation that the OMB regulations do not require inclusion of external
factors in annual performance plans, and we have been careful not to state that they are
required in these plans. However, the focus of our assessment is on how the plan can be more
useful to Congress and other decisionmakers. NASA provided a general discussion of
external factors in its fiscal year 2000 plan that were not specific to any objective. We
continue to believe that the plan would be augmented if (a) external factors were explicitly
discussed relative to objectives whose attainment is strongly tied to these external influences
and (b) NASA explained how it would mitigate any negative effects.

Third, NASA disagreed with our characterization of its plan as providing a “limited picture of
intended performance across the agency.” NASA stated that its plan included detailed
performance targets that cover all of its program and finance accounts and most of its budget
line items and programmatic elements of its strategic plan. Our assessment of the plan, as it
related to providing an intended picture of performance across the agency, focused on
whether the sum total of goals, objectives, and measures provided a clear understanding and
complete picture of performance across the agency, not on the number of performance
targets the plan provided. The incomplete discussion of longstanding management issues is
illustrative of the plan’s need to address longstanding priority issues, a key indicator of NASA
having provided a complete picture of performance across the agency.




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Enclosure II

Management Challenges


Table II.1 shows NASA’s major management challenges that we and NASA’s Office of the
Inspector General (OIG) have identified and NASA’s annual performance plan for fiscal year
2000 addresses.



Table II.1: Management Challenges in NASA’s Fiscal Year 2000 Performance Plan
GAO identified management challenge                      Applicable references in the fiscal year 2000
                                                         annual performance plan
Contract management                                      NASA’s performance plan includes a performance
                                                         target to implement new financial systems and
GAO has reported that NASA’s contract management         business procedures (including a new financial
is a continuing area of high risk. Implementation of     classification structure and full cost budgeting and
the financial management system and its integration      accounting procedures) through the introduction and
with full cost accounting has been delayed. Until the    installation of the Integrated Financial Management
financial management system is operational,              System (IFMS). The plan notes that following
performance assessments relying on cost data may         completion of system testing, the system will begin to
be incomplete.                                           be installed at NASA headquarters and field centers.

NASA’s OIG reported contract management as a             The final FY 1999 performance plan also added
GAO-identified management challenge.                     targets to describe additional procurement actions
                                                         being undertaken in FY 1999. It stated that contract
                                                         management would be enhanced through improved
                                                         systems and information for monitoring and through an
                                                         emphasis on the training of procurement personnel.
                                                         Also, metrics would be revised to assess the overall
                                                         health of the procurement system. It also stated that a
                                                         strategy for evaluating the efficacy of procurement
                                                         operations would be implemented in FY 1999. (NASA
                                                         officials noted that these specific remedial actions will
                                                         be completed in FY 1999 and thus do not appear in
                                                         the FY 2000 plan.)


International Space Station Program                      None. However, the management of risks in building
                                                         the International Space Station is identified in the
We reported that the International Space Station         President’s FY 2000 budget submission as one of the
Program continues to face cost and schedule              top 24 government management challenges.
challenges and the effects of funding shortfalls in
Russia; NASA continues to identify cost growth and
limited reserves as major program concerns and is
now giving added attention to problems with support
from others than the prime contractor. In January
1999, we reported that the prime contractor’s latest
overrun estimate at completion has increased from
$680 million to $780 million.

NASA’s OIG also reported that the International
Space Station Program continues to experience cost
overruns and scheduling delays.

Cooperation between NASA and Department of               None.
Defense on aerospace test facilities




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Enclosure II
Management Challenges




GAO identified management challenge                       Applicable references in the fiscal year 2000
                                                          annual performance plan

We reported that the promise of closer cooperation
between NASA and DOD and the development of a
national perspective on aerospace test facilities
remain largely unfulfilled. NASA and DOD (1) have
not convened most joint test facility working groups
on a regular basis, (2) have competed with each other
to test engines for new rockets, and (3) have not
prepared a congressionally required joint plan on
rocket propulsion test facilities.




Inspector General’s areas of concern                      Applicable references in the fiscal year 2000
                                                          annual performance plan
Safety and mission assurance                              NASA’s performance plan includes an objective that
                                                          the Space Shuttle will continue with safety and
NASA’s OIG has reported that safety and mission           performance upgrades. Phase 1 upgrades are
assurance has become a serious challenge to NASA.         designed to improve safety and performance that will
The challenges are ensuring an appropriate level of       enable the shuttle to achieve the orbital inclination and
training for staff that conduct safety reviews and        altitude of the International Space Station. A variety of
evaluations; maintaining adequate safety reporting        process improvements will be implemented to enhance
systems; ensuring compliance with safety standards        shuttle safety and reliability and reduce costs.
and regulations; ensuring product safety and              Performance targets include (1) having a shuttle
reliability; and developing appropriate safety planning   upgrade program that ensures the availability of safe
mechanisms.                                               and reliable shuttle system through the International
                                                          Space Station era and (2) achieving seven or fewer
                                                          flight anomalies per mission.

                                                          NASA included an objective to ensure the health,
                                                          safety, and performance of humans in space.
                                                          Performance targets include (1) developing medical
                                                          protocols and testing the capability of crews health
                                                          care system as integrated in the U.S. laboratory; (2)
                                                          completing the first phase of the advanced life support
                                                          system integration test bed facility, which will provide
                                                          the capability to conduct a series of long duration,
                                                          human in the loop, advanced technology tests over the
                                                          next 6 years; and (3) providing training to the
                                                          appropriate NASA supervisors with specific emphasis
                                                          on actions to prevent injury and illness on the job.

                                                          NASA included an objective to contribute to aviation
                                                          safety by reducing aircraft accident rates. The
                                                          performance target is to demonstrate a conceptual
                                                          aircraft flight deck integrated with evolving ground-
                                                          based runway incursion avoidance technologies
                                                          installed at a major airport.

                                                          The plan discusses safety in the context of




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Enclosure II
Management Challenges




Inspector General’s areas of concern                       Applicable references in the fiscal year 2000
                                                           annual performance plan
                                                           performance measurement. It notes that it is important
                                                           to avoid evaluating actual output performance in
                                                           research and development (R&D) organizations by
                                                           counting the number of planned events for the year
                                                           with the number that actually occurred. The
                                                           “beancount” approach, according to the plan, is more
                                                           appropriate to a known manufacturing environment. In
                                                           the high performance, high-risk R&D environment that
                                                           characterizes NASA’s programs, NASA believes that it
                                                           is inadvisable to incentivize on-time performance and
                                                           thereby deemphasize safety, quality, high
                                                           performance, and appropriate risk-taking.
Year 2000 computer problems                                None. However, a Y2K performance target was added
                                                           to the final FY 1999 performance plan. The plan states
NASA’s OIG has reported that NASA’s assessment of          that the agency will complete remediation of mission-
Year 2000 Y2K computer problems has major gaps.            critical systems by March 1999, consistent with
NASA has identified the Y2K problem as a significant       governmentwide guidelines for Year 2000. NASA
area of management concern in the annual Federal           officials stated that the Y2K concern would be resolved
Managers’ Financial Integrity Act Report. OIG audits       by the end of FY 1999 and thus is not discussed in the
found gaps in NASA’s guidance on cost estimation,          FY 2000 plan.
documentation of its Y2K efforts, and its identification
of critical systems.

Although we did not characterize the Y2K problem as
a major management challenge, we raised a concern
similar to the OIG’s in our review of NASA’s FY 1999
Performance Plan. The concern related to the failure
of the information technology goal and measure to
address the Y2K problem as well as any significant
information security weaknesses. (GAO/NSIAD-98-
181)
Information Technology Security System                     None. However, the plan includes an objective to
                                                           ensure that information technology provides an open
NASA’s OIG reported that the IT security system has        and secure exchange of information, is consistent with
serious weaknesses. The OIG recommended that               agency technical architectures and standards,
NASA designate IT security as a high-risk area in the      demonstrates a projected return on investment,
annual Federal Managers’ Financial Integrity Act           reduces risk, and directly contributes to mission
report based on the fragmentation of the system, the       success. The FY 2000 plan includes as a target the
lack of policies and guidance, network physical and        improvement of information technology infrastructure
system security weaknesses, the lack of properly           service delivery to provide increased capability and
trained personnel, and lack of threat analysis.            efficiency while maintaining both a customer rating of
                                                           “satisfactory” and costs per resource unit at the FY
                                                           1998 baseline.


Waste and abuse as Financial Management System             The plan includes a performance target to implement
is integrated                                              new financial systems and business procedures
                                                           (including a new financial classification structure and
NASA’s OIG has reported concerns with waste and            full cost budgeting and accounting procedures) through
abuse as NASA integrates its financial management          the introduction and installation of the IFMS. Following
system. NASA has identified its financial                  completion of testing, the system will begin to be
management environment, comprising of                      installed at NASA headquarters and field centers.




Page 14                                             GAO/NSIAD-99-186R NASA’s Fiscal Year 2000 Performance Plan
Enclosure II
Management Challenges




Inspector General’s areas of concern                      Applicable references in the fiscal year 2000
                                                          annual performance plan
decentralized, nonintegrated systems, as a significant
area of concern in its FY 1998 FMFIA report. To
remedy this situation, NASA will implement the IFMS.
The OIG continues to have serious concerns about
delays in delivery of this product, disputes about the
scope of the deliverables, and the costs associated
with running parallel systems until the IFMS is fully
implemented.

Our concern on contract management includes this
issue.
Launch vehicles                                           The plan includes an objective to revolutionize space
                                                          launch capabilities. The X-33 program will begin and
NASA’s OIG reported on challenges in (1) ensuring         complete flight testing in FY 2000 to demonstrate
the availability of small expendable launch vehicles so   technologies that are traceable to the mass fraction
that milestones can be met and NASA’s missions are        and operability required for future reusable launch
cost-effective and (2) evaluating whether NASA’s          vehicles. The target is to conduct flight–testing of the
providing the majority of development funds and           X-33 vehicle in FY 2000. The X-34 program will
assigning technology rights to its industry partners in   demonstrate technologies applicable to future, low-cost
the development of the new reusable launch vehicles       reusable launch vehicles, including high flight rates.
is in the best interest of the government.                The target is to complete vehicle assembly and begin
                                                          flight testing of the second X-34.
International agreements                                  None.

NASA’s OIG reported that international agreements
are needed to ensure effective and efficient
programs. Key considerations include program and
project vulnerability to schedule delays and cost
overruns that require diplomatic rather than
contractual solutions; security controls on technology
that impact national security; controls to ensure the
quality and timeliness of the goods and services
provided; and mechanisms to assure balance
between program needs and national considerations.
Environmental cleanup                                     None.

NASA’s OIG reported that NASA has not addressed
its many environmental cleanup issues. Years of
operations and research activities have left NASA
with major environmental cleanup issues.




Page 15                                            GAO/NSIAD-99-186R NASA’s Fiscal Year 2000 Performance Plan
Enclosure III

Comments From the National Aeronautics
and Space Administration




                Page 16   GAO/NSIAD-99-186R NASA’s Fiscal Year 2000 Performance Plan
Enclosure III
Comments From the National Aeronautics and Space Administration




Page 17                   GAO/NSIAD-99-186R NASA’s Fiscal Year 2000 Performance Plan
Enclosure IV

GAO Contacts and Staff
Acknowledgments

GAO Contact
Allen Li,   (202) 512-4841

Acknowledgments
In addition to the contact named above, Richard J. Herley, Shirley B. Johnson, Elizabeth L.
Johnston, Laura E. Castro, Linda P. Garrison, Rhonda P. Rose, and William T. Woods made
key contributions to this product.




(707425)




Page 18                                  GAO/NSIAD-99-186R NASA’s Fiscal Year 2000 Performance Plan