Major Management Challenges at the Department of Commerce
The Department of Commerce (Commerce) has made some progress in addressing several management challenges identified in GAO's 2003 report. However, significant challenges remain with respect to planning and conducting the 2010 census , improved weather forecasting , and management of key natural resources , as described below. GAO has not issued any reports on the following Commerce management challenges since the 2003 report: financial management functions or government-wide challenges such as information security weaknesses and management of federal real property .
With respect to planning and conducting a cost-effective 2010 census and improving other Commerce statistical programs , the department has made progress since GAO's 2003 report, but a number of significant challenges remain. For example, the U. S. Census Bureau's (Census) preparations for the 2010 headcount appear to be more rigorous and further along than at a similar point during the planning cycle for the 2000 census. However, Census will be challenged to control the spiraling cost of the headcount, now estimated at more than $11 billion. The nation will spend around $72 to count each household in 2010 compared to $56 in 2000 (in constant 2000 dollars) largely due to difficulties associated with locating people and getting them to participate in the census. The increased costs associated with the census, at a time of record federal budget deficits, raises the question of how to best balance the need for an accurate census with the need to ensure its cost does not become unreasonable. Should Census experience a steep cut in funding, it may be unable to revise and test its plans rapidly enough to execute a reliable enumeration. Although the design of the 2010 census can, in concept, help control costs and produce more accurate data, Census will be challenged to successfully implement key elements of its plan, and the failure to successfully carry out any one component of its approach could undermine the cost-effectiveness of the entire enterprise. In light of these challenges, GAO's work has recommended actions Commerce should take to improve the transparency of the census planning process and underscored the need for policymakers to consider the census's long-term costs. Another Commerce statistical program, the American Community Survey (ACS), continues to face challenges as well. In an October 2004 report, GAO concluded that Census still needs to resolve various methodological and operational issues facing the ACS so that it can adequately replace the decennial census long-form questionnaire, as planned. GAO recommended that Commerce direct Census to revise its ACS evaluation and testing plan to address the issues identified.
In Commerce's efforts to promote and liberalize trade , the department has made progress in correcting weaknesses in trade agreement information systems. Commerce continues to assist the Office of the U.S. Trade Representative in trade negotiations in a variety of venues. For example, Commerce participates in bilateral free trade agreement negotiations, multilateral forums such as the Free Trade Area of the Americas, and sectoral negotiations such as intellectual property rights. Commerce also assists in monitoring trade commitments, such as China's World Trade Organization (WTO) commitments. To this end, Commerce uses a centrally maintained database to track market access and compliance cases, and it has taken several important steps to improve the quality of this database, including providing training to staff on how to use the database, creating a users' manual, and overseeing the timeliness and completeness of staff entries. GAO also recommended that Commerce take further steps to improve data accuracy.
Indian tribes have used Economic Development (EDA) grants to create businesses, build roads and other infrastructure, and create economic development plans, but these grants have had mixed success in creating jobs , income, and private sector investment. From 1993 to 2002, 143 Indian tribes received $112 million in EDA grants, but this represented a small portion of EDA's awards to all organizations. Of 31 projects that GAO reviewed, tribal officials reported that about half were profitable or were covering their costs, and the remainder were being subsidized or had failed.
Commerce's Bureau of Industry and Security (BIS), which administers the U.S. control system for dual-use exports, has taken steps to strengthen export controls as described below:
- In response to GAO's January 2004 recommendation that BIS close a regulatory loophole in export controls aimed at stemming missile proliferation, BIS issued a revision to the U.S. export regulations on November 8, 2004, that expands existing export controls to better address potential missile proliferation by nonstate actors.
- In response to a recommendation in a separate January 2004 report aimed at improving the end-use monitoring process for dual-use exports, BIS has taken steps to better train team members performing the checks and reviewing the enforceability of conditions placed on export licenses, and now requires that the exporters inform end-users of license conditions in writing.
With respect to improved weather forecasting , GAO recently reported on program management challenges with the National Polar-orbiting Operational Environmental Satellite System (NPOESS), a planned satellite system that is critical to the United States' ability to maintain the continuity of data required for weather forecasting and global climate monitoring through the year 2020. GAO reported that the program office recently increased the NPOESS cost estimate to $8.1 billion and delayed key milestones, including the availability of the first NPOESS satellite--which was delayed by 20 months. Other factors, including technical risks and contractor performance shortfalls, could contribute to further cost increases and schedule slips.
Commerce can take additional steps to improve its management of key natural resources , such as fishery's management. Specifically, GAO recommended that the National Marine Fisheries Service (NMFS) ensure that regional fishery management councils develop measurable objectives and performance measures as they create new individual fishing quota programs or redesign existing ones and ensure that progress in meeting these goals is monitored. Similarly, GAO recommended that NMFS take additional actions to improve the reliability of its stock assessments, such as efforts to improve the quality and types of data used in its groundfish assessments.
Regarding strategic human capital management , Commerce has demonstrated mixed success in implementing pay for performance systems. Commerce and one of its agencies--the National Institute of Standards and Technology (NIST)--have implemented pay for performance demonstration projects. Commerce and NIST demonstration projects are among 12 such projects that have been approved governmentwide by the Office of Personnel Management. Personnel demonstration projects allow agencies to waive existing civilian personnel laws and regulations under Title 5 to propose, develop, test, and evaluate alternative approaches to managing their human capital. Commerce and NIST demonstration projects as well as the projects of other entities have taken a variety of approaches to managing and implementing their pay for performance systems to meet the unique needs of their cultures and organizational structures. These demonstration projects show an understanding that how to better link pay to performance is very much a work in progress at the federal level. For example, core competencies applied organizationwide can help reinforce employee behaviors and actions that support the organization's mission, goals, and values and can provide a consistent message to employees about how they are expected to achieve results. Commerce and NIST use position-based core competencies to evaluate employee performance. Also, making meaningful distinctions between top and poor performers with objective and fact-based information is key to an effective performance management system. We found that Commerce and NIST made few distinctions in employee performance. However, NIST published averages of the performance rating scores by unit and career path. Publishing the results of the performance management process can provide employees with the information they need to better understand the performance management system.
Related GAO Products
Data Quality: Census Bureau Needs to Accelerate Efforts to Develop and Implement Data Quality Review Standards. GAO-05-86 . Washington, D.C.: November 17, 2004.
Census 2000: Design Choices Contributed to Inaccuracies in Coverage Evaluation Estimates . GAO-05-71 . Washington, D.C.: November 12, 2004.
2010 Census: Counting Americans Overseas as Part of the Decennial Census Would Not Be Cost-Effective. GAO-04-898 . Washington, D.C.: August 19, 2004.
2010 Census: Overseas Enumeration Test Raises Need for Clear Policy Direction. GAO-04-470 . Washington, D.C.: May 21, 2004.
2010 Census: Cost and Design Issues Need to Be Addressed Soon. GAO-04-37 . Washington, D.C.: January 15, 2004.
Decennial Census: Lessons Learned for Locating and Counting Migrant and Seasonal Farm Workers. GAO-03-605 . Washington, D.C.: July 3, 2003.
Decennial Census: Methods for Collecting and Reporting Hispanic Subgroup Data Need Refinement . GAO-03-228 . Washington, D.C.: January 17, 2003.
Decennial Census: Methods for Collecting and Reporting Data on the Homeless and Others Without Conventional Housing Need Refinement . GAO-03-227 . Washington, D.C.: January 17, 2003.
American Community Survey
American Community Survey: Key Unresolved Issues. GAO-05-82 . Washington, D.C.: October 8, 2004.
Promoting and Liberalizing Trade while Creating Jobs
U.S.-China Trade: Opportunities to Improve U.S. Government Efforts to Ensure China's Compliance with World Trade Organization Commitments . GAO-05-53 . Washington, D.C.: October 6, 2004.
International Trade: Current Government Data Provide Limited Insight into Offshoring of Services . GAO-04-932 . Washington, D.C.: September 22, 2004.
Intellectual Property: U.S. Efforts Have Contributed to Strengthening Laws Overseas, but Challenges Remain . GAO-04-912 . Washington, D.C.: September 8, 2004.
World Trade Organization: Cancun Ministerial Fails to Move Global Trade Negotiations Forward; Next Steps Uncertain . GAO-04-250 . Washington, D.C.: January 15, 2004.
International Trade: Intensifying Free Trade Negotiating Agenda Calls for Better Allocation of Staff and Resources . GAO-04-233 . Washington, D.C.: January 12, 2004.
World Trade Organization: Standard of Review and Impact of Trade Remedy Rulings . GAO-03-824 . Washington, D.C.: July 30, 2003.
Free Trade Area of the Americas: Negotiations Progress, but Successful Ministerial Hinges on Intensified U.S. Preparations . GAO-03-560 . Washington, D.C.: April 11, 2003.
World Trade Organization: First-Year Efforts to Monitor China's Compliance . GAO-03-461 . Washington, D.C.: March 31, 2003.
Indian Economic Development: Relationship to EDA Grants and Self-determination Contracting Is Mixed . GAO-04-847 . Washington, D.C.: September 8, 2004.
Nonproliferation: Improvements Needed for Controls on Exports of Cruise Missile and Unmanned Aerial Vehicle Technology. GAO-04-493T . Washington, D.C.: March 9, 2004.
Nonproliferation: Improvements Needed to Better Control Technology Exports for Cruise Missiles and Unmanned Aerial Vehicles. GAO-04-175 . Washington, D.C.: January 23, 2004.
Export Controls: Post-Shipment Verification Provides Limited Assurance That Dual-Use Items Are Being Properly Used . GAO-04-357 . Washington, D.C.: January 12, 2004.
Improved Weather Forecasting
Polar-orbiting Environmental Satellites: Information on Program Cost and Schedule Changes . GAO-04-1054 . Washington, D.C.: September 30, 2004.
Management of Key Natural Resources
Pacific Groundfish: Continued Efforts Needed to Improve Reliability of Stock Assessments . GAO-04-606 . Washington, D.C.: June 4, 2004.
Individual Fishing Quotas: Economic Effects on Processors and Methods Available to Protect Communities . GAO-04-487T . Washington, D.C.: February 25, 2004.
Individual Fishing Quotas: Methods for Community Protection and New Entry Require Periodic Evaluation . GAO-04-277 . Washington, D.C.: February 24, 2004.
Federal Funding of Oceans and Coastal Activities . GAO-03-1070R . Washington, D.C.: August 11, 2003.
Strategic Human Capital Management
Human Capital: Implementing Pay for Performance at Selected Personnel Demonstration Projects . GAO-04-83 . Washington, D.C.: January 23, 2004.