Human Capital Legislative Proposals to NASA's Fiscal Year 2003
Authorization Bill (15-NOV-02, GAO-03-264R).
GAO reviewed several issues relating to the National Aeronautics
and Space Administration's (NASA) workforce and management
challenges. These issues are associated with NASA's proposed
legislative provisions for additional flexibilities and
authorities to help it address its human capital challenge. GAO
found that agencies must ensure that their strategic human
capital plans are results-oriented and data-driven. This includes
developing appropriate information on the number and location of
employees and their key competences and skills, as well as data
on the profile of the workforce, and performance goals and
measures for human capital approaches. NASA's legislative
proposal for streamlined demonstration and alternative personnel
system authority would provide a mechanism for converting a
successful demonstration project, upon approval by the Office of
Personnel Management (OPM), to a permanent alternative personnel
system, without the need for special legislation and without any
limitation on the number of employees that would be covered by
the project as is under current authority. Human capital systems
should have appropriate transparency and adequate safeguards in
order to help ensure that it is efficient, effective, credible,
and equitable.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-03-264R
ACCNO: A05533
TITLE: Human Capital Legislative Proposals to NASA's Fiscal Year
2003 Authorization Bill
DATE: 11/15/2002
SUBJECT: Federal employees
Human resources utilization
Personnel management
Performance measures
Strategic planning
NASA Strategic Human Capital
Implementation Plan
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GAO-03-264R
GAO- 03- 264R NASA Human Capital Flexibilities
United States General Accounting Office Washington, DC 20548
Comptroller General of the United States
November 15, 2002 The Honorable Dana Rohrabacher Chairman The Honorable
Bart Gordon Ranking Minority Member Subcommittee on Space and Aeronautics
Committee on Science House of Representatives
Subject: Human Capital Legislative Proposals to NASA*s Fiscal Year 2003
Authorization Bill
You asked us to provide additional comments on several issues relating to
the July 18, 2002, hearing held by your Subcommittee on the National
Aeronautics and Space Administration*s workforce and management
challenges. Basically, these issues are associated with NASA*s proposed
legislative provisions for additional flexibilities and authorities to
help it address its human capital challenge. I am pleased to submit the
following comments for your consideration.
1. You and the NASA Administrator recognized that it would require five to
seven years for NASA to transform its workforce and meet the goals of its
Strategic Human Capital Implementation Plan. Does NASA*s Strategic Human
Capital Implementation Plan include an appropriate set of goals and a
sound strategy for addressing NASA*s human capital challenges? Do you have
any recommendations that would strengthen this plan?
Because our work has not entailed a detailed analysis of NASA*s Strategic
Human Capital Implementation Plan, we are not in a position to report on
the appropriateness and soundness of the goals and strategies at this
time. 1 However, in response to your question, we observe that NASA*s
Strategic Human Capital Implementation Plan contains a number of goals and
strategies, as well as specific improvement initiatives that the agency is
implementing or is committed to implementing. The goals, strategies, and
improvement initiatives are organized under
1 The focus of our work to date has been following up on NASA*s actions to
respond to its shuttle program workforce challenges.
GAO- 03- 264R NASA Human Capital Flexibilities Page 2 five human capital
pillars. Furthermore, the plan contains milestones for achieving
the improvement initiatives and metrics for assessing their progress.
Until recently, NASA*s Strategic Human Capital Plan and companion
Strategic Human Capital Implementation Plan were in draft form and were
being reviewed by the Office of Management and Budget (OMB) and the Office
of Personnel Management (OPM). OMB and OPM approved those plans subsequent
to the Subcommittee*s hearing* in August 2002. According to NASA, it
developed its plans based on OMB*s scorecard of human capital standards,
OPM*s scorecard of supporting human capital dimensions, and our human
capital model. 2 The pillars and goals are described below.
Table 1: NASA*s Strategic Human Capital Plan Pillars and Goals Pillar Goal
Strategic Alignment
NASA aligns human capital to support the vision and accomplish the
agency*s mission and goals.
(1) The agency is well structured organizationally and matches its
workforce and workload to support its mission in a safe, effective, and
efficient way. (2) Employees understand how what they do and how they do
them in support of overall agency goals. (3) Human resources activities
clearly, effectively, and efficiently support and enable the agency*s
mission.
Strategic Competencies
NASA recruits, acquires, and retains a diverse workforce with world- class
capabilities in strategic competencies needed for all components of its
mission.
(4) The agency knows the competencies it needs and the workforce is
concentrated in those competencies. (5) NASA recruits, acquires, and
retains world- class employees in the essential competencies.
Learning
NASA promotes a knowledgesharing culture and a climate of openness,
continuous learning, and improvement.
(6) NASA has a climate of open sharing of relevant knowledge to facilitate
best practices, promote personal and professional growth, and avoid
failures. (7) NASA actively collects, shares, and utilizes best practices
from its successes and lessons learned from its failures.
Performance Culture
NASA creates a culture that focuses on results, motivates employees to
perform, and ensures fairness in the workplace.
(8) NASA fosters an inclusive climate where employees are valued and
treated fairly and with respect, and they feel empowered to make
meaningful, relevant, and fulfilling contributions. (9) Equal opportunity
and diversity are utilized and valued for their contribution to the
agency*s mission. (10) The NASA rewards and recognition system
acknowledges high- level performance and encourages the behaviors the
agency desires in individuals and groups.
Leadership
NASA ensures it has leaders who are adaptable; who inspire, motivate, and
guide others toward goals; who mentor and challenge the workforce; and who
demonstrate high standards of honesty, integrity, trust, openness, and
respect.
(11) NASA recruits, selects, hires, and retains a diverse, high performing
cadre of leaders who are nurtured through training and development
opportunities. (12) Leaders are held accountable for overall performance,
at the individual and organizational levels, in maintaining high standards
of honesty, integrity, safety and equal opportunity principles.
Source: NASA. 2 U. S. General Accounting Office, A Model of Strategic
Human Capital Management, GAO- 02- 373SP (Washington, D. C.: Mar. 15,
2002).
GAO- 03- 264R NASA Human Capital Flexibilities Page 3 One of the things
that I pointed out at the Subcommittee*s July 2002 hearing that
agencies must do to successfully address their human capital challenges is
to ensure that their strategic human capital plans are results- oriented
and data- driven. This includes developing appropriate information on the
number and location of employees and their key competencies and skills, as
well as data on the profile of the workforce, and performance goals and
measures for human capital approaches. Further, this data must be used
effectively to develop strategies that continually ensure that agencies
have the right mix of employees to meet their future needs. A key to
success in this area will also be NASA*s ability to implement its new
financial management system, because it will encompass the integrated
workforce planning and analysis system that NASA includes as an
improvement initiative in its Strategic Human Capital Plan and plans to
implement in 2005. The workforce planning and analysis system is expected
to track the distribution of NASA*s workforce across programs, capture
critical competencies and skills, determine management and leadership
depth, and facilitate gap analyses. Currently, NASA has limited capability
for personnel tracking and planning, particularly on an agencywide or
programwide basis. Based on the numerous initiatives NASA will need to
undertake, transforming the agency will likely require a multi- year
implementation period.
2. How effectively is NASA using existing authorities to meet its human
capital goals? 3. Do you have any recommendations for how NASA can more
fully utilize
the existing authorities? 4. If fully utilized, are the existing
authorities sufficient to meet NASA*s
goals? If not, what goals cannot be met without new or expanded
authorities? 5. Which proposed new or expanded authorities, if any, are
required if
NASA is to meet its human capital goals?
Our work associated with NASA*s human capital challenge has focused
primarily on following up on the agency*s actions to respond to its
shuttle program workforce challenges. At this time, without having
performed a more detailed analysis of NASA*s human capital plans, we are
not in a position to assess NASA*s use of existing authorities, the
sufficiency of those authorities, and their relationship to its agencywide
human capital goals.
However, we will soon issue a report on human capital flexibilities that
could be of significant use to the Subcommittee as it considers NASA*s
request for additional authorities and flexibilities to recruit, train,
and retain critical skills. The report emphasizes that federal agencies
should first identify and use the flexibilities available under existing
laws and regulations. If additional flexibilities are desired, agencies
should develop sound business cases to justify the need for the additional
authorities. In this regard, the report discusses agency and union
officials* views on the most effective flexibilities for managing their
workforces and additional flexibilities that would be most helpful in
managing their workforces. It also identifies key practices that agencies
should implement to use human capital flexibilities effectively.
GAO- 03- 264R NASA Human Capital Flexibilities Page 4 According to
interviews we held with agency officials at numerous federal
organizations and union representatives of several national organizations,
work- life programs, such as alternative and flexible work schedules,
transit subsidies, child care assistance, and employee assistance
programs, are among the most effective human capital flexibilities
available in federal agencies for managing the workforce to achieve agency
missions and accomplish agency goals. These flexibilities* all of which
are currently available to NASA-- are effective because they serve as
important recruitment and retention tools as employees weigh the balance
between their work life and leisure time. In addition, agency and union
officials frequently cited monetary recruitment and retention incentives,
including recruitment and relocation bonuses for hard- to- fill positions;
special hiring authorities, such as limited term appointments and student
employment and outstanding scholar programs; and incentive awards to
employees for superior job performance and specific accomplishments,
including cash and time- off awards.
Categories of additional flexibilities suggested by the officials that
would be the most helpful in managing the workforce, if authorized,
include (1) more flexible classification and pay approaches, (2) greater
flexibility to streamline and improve the federal hiring process, (3)
increased flexibility in addressing employees* poor job performance, (4)
additional workforce restructuring options, and (5) expanded flexibility
in acquiring and retaining temporary employees. These suggestions would
provide a starting point for executive branch decision makers and Congress
to consider as they seek to reform federal human capital policies and
practices. Key aspects of these additional authorities are included in
various legislative initiatives under consideration by Congress. In other
cases, however, additional analyses may be needed to ensure that any new
authorities are granted and implemented consistent with a focus on program
results, merit, and other important federal employment goals.
Our forthcoming report also emphasizes the importance of effectively
implementing human capital flexibilities, noting that by more effectively
using flexibilities, agencies would be in a better position to manage
their workforces, ensure accountability, and transform their cultures to
address current and emerging demands. To ensure the most effective use of
human capital flexibilities, it is important that agencies
plan strategically and make targeted investments; ensure stakeholder
input in developing policies and procedures; educate managers and
employees on the availability and use of flexibilities; streamline and
improve administrative processes; build transparency and accountability
into the system; and change the organizational culture.
With regard to NASA, we plan to periodically monitor the agency*s human
capital planning and implementation efforts and report to Congress as
appropriate. We will be pleased to meet with the Subcommittee in this
regard.
GAO- 03- 264R NASA Human Capital Flexibilities Page 5
6. What meaningful objectives and measurable goals would you recommend to
track progress over the next five years as NASA implements its human
capital plans?
It might be better to address this question in terms of the supporting
metrics in the human capital plans that NASA has established for assessing
its human capital goals. NASA*s human capital plans refer to a hierarchy
of metrics to assess the agency*s progress toward achieving its goals. The
plans state that the highest level of metrics are those *critical few*
that NASA*s senior management and stakeholders care most about and have
identified as most appropriate for incorporation into the agency*s
Government Performance and Results Act- related annual performance and
reporting process. Two specific metrics, which the plans state cover a
number of goals, have been identified as critical to helping NASA assess
its progress toward achieving its human capital aims and assisting it in
analyzing root causes of problems and issues. Recognizing that we have not
performed a detailed analysis of NASA*s human capital plans, these metrics
seem meaningful and reasonable to track over the next 5 to 7 years.
However, this does not suggest that NASA*s commitment to achieving the
remaining human capital goals and measures in its human capital plans
should be lessened or that the remaining goals and measures should not be
tracked. The two critical metrics are:
(1) NASA*s progress in closing gaps in critical competencies. Using this
metric, NASA will be able to determine, on an agencywide basis, whether
the gap between the strategic competencies it has and those it needs is no
greater than 10 percent by the end of fiscal year 2004 and that, within
the same period, no gaps exist in those competencies identified as
*mission critical.* Thereafter, NASA will reduce the strategic
competencies gap to no more than 5 percent within 2 years and maintain at
that level, except there will be essentially no gaps in competencies
identified as mission critical.
(2) Alignment of NASA*s human capital strategy with its mission, goals,
and organizational objectives. This metric will allow NASA to determine
whether it is achieving an overall combined score that is in the top 10
percent of all scores governmentwide on the OPM- administered
governmentwide survey. This metric will assess NASA*s performance relative
to whether (a) people have the resources they need to perform their jobs,
(b) the performance management system is effective in identifying poor
performance and taking steps to improve performance, (c) awards and
recognition programs incentivize and reward the behaviors the agency wants
to foster, (d) the workforce has adequate opportunities for learning and
improvement, and (e) NASA fosters an environment of inclusiveness.
According to NASA*s Strategic Human Capital Implementation Plan, the
results of the two critical metrics will serve as guideposts for
evaluating the overall health of NASA*s human capital management effort.
NASA believes that they cover directly or indirectly agency progress in
addressing all of the areas of concern expressed by internal and external
parties regarding the agency*s workforce, including:
GAO- 03- 264R NASA Human Capital Flexibilities Page 6 identifying and
managing competencies needed to carry out the mission
and eliminating gaps in mission critical competencies; succession
planning; strategically using existing personnel tools, flexibilities,
and
technologies; differentiating between high and low performers through
appropriate
incentives and awards and merit- based human resources management; and
appropriately considering skill mix, technology, electronic government,
and competitive sourcing.
7. Could NASA meet its goals solely through the use of the proposed
alternative personnel system demonstration authority? Are there risks
associated with solely using the demonstration authority? Would this
present any special challenges for congressional oversight?
NASA*s legislative proposal for streamlined demonstration and alternative
personnel system authority would provide a mechanism for converting a
successful demonstration project, 3 upon approval by OPM, to a permanent
alternative personnel system, without the need for special legislation and
without any limitation on the number of employees that would be covered by
the project as is under current authority. It is our understanding that
the NASA Administrator believes that it would be difficult for the agency
to meet its goals solely through the use of this proposal. He testified at
the July 2002 hearing that the legislative provisions when taken
individually would only help NASA deal with its human capital strategic
threats to a limited degree. The Administrator stated that when taken
together as an integrated package, the provisions would form a strong
nucleus in support of NASA*s Strategic Human Capital Plan and the
President*s Management Agenda and would enable NASA to avert a serious
human capital crisis.
Without having fully analyzed this proposal in relation to NASA*s unique
human capital needs, it is difficult at this time to state whether NASA
could meet its goals solely through the use of the proposed alternative
personnel system demonstration authority. Also, to identify the risks
associated with solely using the demonstration authority would require an
assessment of the pros and cons of using such an option, particularly if
it means bypassing Congress in creating permanent alternative personnel
systems and allowing OPM approval without the need for special legislation
as proposed by NASA. However, a number of federal agencies have taken
advantage of options provided by Congress to test or implement innovative
human capital policies, programs, and practices that operate outside the
framework of title 5, United States Code, and regulations under this
title, as evidenced by a recent study by
3 A demonstration project is a project conducted by OPM, or under its
supervision, to determine whether a specified change in personnel
management policies or procedures would result in improved federal
personnel management (5 U. S. C. 4701( a) (4). Demonstration projects are
conducted directly by OPM or jointly by OPM and the agency or
organization. Under title 5, OPM is permitted to waive certain provisions
and regulations under this title to enable agencies or organizations to
conduct demonstration projects by experimenting with new and innovative
systems (5 U. S. C. 4703 (a).
GAO- 03- 264R NASA Human Capital Flexibilities Page 7 The Partnership for
Public Service. 4 The study notes that in most cases these
innovations have proven successful in improving the agencies* ability to
attract, motivate, or retain a highly qualified workforce while still
adhering to the basic principles of a merit- based system. Many of the
successful practices were developed through the use of OPM demonstration
projects. Pay banding is an approach that has been successfully used in a
number of federal organizations, including GAO. It provides the
flexibility to offer greater competitive starting salaries and rewards to
high- performing employees with financial incentives. As I testified
before the National Commission on the Public Service in July 2002,
Congress may wish to explore the benefits of providing OPM additional
flexibility that would enable it to grant governmentwide authority for all
agencies to use broadbanding for certain critical occupations and/ or
allowing agencies to apply to OPM for broadbanding authority for their
specific critical occupations. Agencies should be required to demonstrate
to OPM*s satisfaction that they have modern, effective, and validated
performance management systems before they are allowed to use
broadbanding. However, the prerogative of congressional oversight must be
maintained.
8. Could adopting NASA- specific provisions as opposed to taking a
government- wide approach lead to a situation wherein scientific and
engineering personnel leave other agencies to take advantage of incentives
and flexibilities granted to NASA? If so, what would need to be done to
prevent such a situation from developing?
When individual agencies are provided flexibilities to address their own
strategic human capital needs, it can create a change in the competitive
balance for selected personnel. The significance of any related impact
would depend on the nature of the flexibilities granted to the agency. For
example, expedited hiring authority or earlyout and buy- out authority
would not have the same impact as higher compensation level authority.
Importantly, most federal workers make their employment decisions based on
the nature of the job, the mission of the agency, the difference they can
make, and the environment within an agency.
Any potential competitive imbalance could be mitigated by limiting the
number, amounts and/ or term of certain individual flexibilities.
Alternatively, governmentwide flexibility could be provided in certain
areas (e. g., limited- term appointment authority for early- out and buy-
out authority and additional compensation authority for selected highly
skilled and competitive occupations and positions). This would serve to
help level the playing field for attracting and retaining top talent among
federal agencies.
9. NASA workforce restructuring is being pursued as part of a
*resultsoriented* management strategy. However, what constitutes a desired
result typically is a function of the policies being pursued by whatever
Administration is in power. The civil service system was established to
help insulate the federal workforce from politics. How do we ensure that
the proposed NASA legislative provisions don*t weaken civil
4 The Partnership for Public Service, Homeland Security: Winning the War
For Talent To Win The War On Terror (July 31, 2002).
GAO- 03- 264R NASA Human Capital Flexibilities Page 8
service protections and lead to increased politicization of the workforce?
The federal government's existing human capital policies and procedures
are based largely on a workforce and labor market that existed in the
1950s. Much has changed in the past 50 plus years and the federal
government's human capital strategies must be modernized if it is to
attract, retain, and motivate top talent in the 21st century. This should
include basing federal employment decisions more on the skills, knowledge,
and performance of individuals rather than the passage of time and the
rate of inflation. However, certain policies should be retained in order
to prevent the politicization of the career civil service and to promote
certain national goals and policies (e. g., veteran's preference,
inclusiveness). Importantly, any human capital system should have
appropriate transparency and adequate safeguards (e. g., appeal rights for
employees) in order to help ensure that it is efficient, effective,
credible, and equitable.
We conducted our work in accordance with generally accepted government
auditing standards.
- - - We are sending copies of this report to other interested
congressional committees. 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 about this report or need additional information, please contact
Allen Li, Director, Acquisition and Sourcing Management, at (202) 512-
4841. Key contributors to this report were Cristina Chaplain, Jerry
Herley, Shirley Johnson, and Edward Stephenson.
David M. Walker Comptroller General of the United States
(120189)
*** End of document. ***