Human Capital
Senior Executive Performance Management Can Be Significantly Strengthened to Achieve Results Gao ID: GAO-04-614 May 26, 2004Congress and the administration have established a new performance-based pay system for members of the Senior Executive Service (SES) that is designed to provide a clear and direct linkage between SES performance and pay. Also, GAO previously reported that significant opportunities exist for agencies to hold the SES accountable for improving organizational results. GAO assessed how well selected agencies are creating linkages between SES performance and organizational success by applying nine key practices GAO previously identified for effective performance management. GAO selected the Department of Education, the Department of Health and Human Services (HHS), and the National Aeronautics and Space Administration (NASA).
Senior executives need to lead the way to transform their agencies' cultures to be more results-oriented, customer focused, and collaborative in nature. Performance management systems can help manage and direct this process. While Education, HHS, and NASA have undertaken important and valuable efforts to link their career SES performance management systems to their organizations' success, there are opportunities to use their systems more strategically. For example, as indicated by the executives themselves, the agencies can better use their performance management systems as a tool to manage the organization or to achieve organizational goals. As Congress and the administration are reforming SES pay to better link pay to performance, valid, reliable, and transparent performance management systems with reasonable safeguards are critical. Information on the experiences and knowledge of these agencies should provide valuable insights to other agencies as they seek to drive internal change and achieve external results.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-04-614, Human Capital: Senior Executive Performance Management Can Be Significantly Strengthened to Achieve Results
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Report to Congressional Requesters:
May 2004:
HUMAN CAPITAL:
Senior Executive Performance Management Can Be Significantly
Strengthened to Achieve Results:
[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-04-614]:
GAO Highlights:
Highlights of GAO-04-614, a report to congressional requesters
Why GAO Did This Study:
Congress and the administration have established a new performance-
based pay system for members of the Senior Executive Service (SES) that
is designed to provide a clear and direct linkage between SES
performance and pay. Also, GAO previously reported that significant
opportunities exist for agencies to hold the SES accountable for
improving organizational results.
GAO assessed how well selected agencies are creating linkages between
SES performance and organizational success by applying nine key
practices GAO previously identified for effective performance
management. GAO selected the Department of Education, the Department of
Health and Human Services (HHS), and the National Aeronautics and Space
Administration (NASA).
What GAO Found:
Senior executives need to lead the way to transform their agencies‘
cultures to be more results-oriented, customer focused, and
collaborative in nature. Performance management systems can help manage
and direct this process. While Education, HHS, and NASA have undertaken
important and valuable efforts to link their career SES performance
management systems to their organizations‘ success, there are
opportunities to maximize their systems to manage their organizations
and achieve organizational goals. For example, as indicated below by
the executives themselves, the agencies can better use their
performance management systems as a tool to manage the organization or
to achieve organizational goals.
As Congress and the administration are reforming SES pay to better link
pay to performance, valid, reliable, and transparent performance
management systems with adequate safeguards are critical. Information
on the experiences and knowledge of these agencies should provide
valuable insights to other agencies as they seek to drive internal
change and achieve external results.
Percentage of Senior Executives Responding to a ’Very Great“ or ’Great“
Extent on Their Agencies‘ Overall Use of Their SES Performance
Management Systems:
[See PDF for image]
[End of figure]
What GAO Recommends:
GAO makes specific recommendations to the agencies to reinforce the
key practices through their SES performance management systems. NASA
concurred with the recommendations, and HHS provided no comments.
Education described specific actions it plans to take to revise its
system, which are generally consistent with our recommendations.
However, GAO disagrees that Education has already implemented or does
not need to implement two of the recommendations.
www.gao.gov/cgi-bin/getrpt?GAO-04-614.
To view the full product, including the scope and methodology, click on
the link above. For more information, contact J. Christopher Mihm at
(202) 512-6806 or mihmj@gao.gov.
[End of section]
Contents:
Letter:
Results in Brief:
Background:
Performance Management Systems Can Be Used More Strategically by
Selected Agencies:
Selected Agencies Can Strengthen the Link between Senior Executive
Performance and Organizational Success:
Conclusions:
Recommendations for Executive Action:
Agency Comments and Our Evaluation:
Appendixes:
Appendix I: Objective, Scope, and Methodology:
Analyzed Agency Documents and Bonus and Rating Data, and Interviewed
Cognizant Agency Officials:
Assessed a Sample of Career SES Individual Performance Plans:
Surveyed All Career SES at Each Agency:
Appendix II: GAO Senior Executive Survey Data from Education, HHS, and
NASA:
Appendix III: Selected Elements of Education's, HHS's, and NASA's SES
Performance Management Systems:
Education:
HHS:
NASA:
Appendix IV: Comments from the Department of Education:
Appendix V: Comments from the Department of Health and Human Services:
Appendix VI: Comments from the National Aeronautics and Space
Administration:
Appendix VII: GAO Contacts and Staff Acknowledgments:
GAO Contacts:
Acknowledgments:
Tables:
Table 1: Percentage of Senior Executives at HHS as Compared to Senior
Executives Governmentwide Who Received Bonuses for Fiscal Years 2000
through 2003:
Table 2: Percentage of HHS Senior Executives Who Received Bonuses and
the Bonus Amounts as a Percentage of Base Pay for Fiscal Year 2003:
Table 3: Percentage of NASA Senior Executives Who Received Bonuses and
the Bonus Amounts as a Percentage of Base Pay for the 2002 and 2003
Performance Appraisal Cycle:
Table 4: Percentage of Education Senior Executives Who Received Bonuses
and the Bonus Amounts as a Percentage of Base Pay for the 2003
Performance Appraisal Cycle:
Table 5: Disposition of SES Performance Plan Review, by Agency:
Table 6: Disposition of SES Survey, by Agency:
Table 7: Number of SES Out of Scope and Reason, by Agency:
Figures:
Figure 1: Percentage of Senior Executives Responding to a "Very Great"
or "Great" Extent on Their Agencies' Overall Use of Their SES
Performance Management Systems:
Figure 2: Percentage of Senior Executives Responding to a "Very Great"
or "Great" Extent on Their Agencies' Use of Their SES Performance
Management Systems to Meet Key Objectives:
Figure 3: Of Those Senior Executives Who See a Connection between Daily
Activities and Organizational Goals to a "Very Great" or "Great"
Extent, Percentage Who Felt That Their System Holds Them Accountable to
a "Very Great" or "Great" Extent:
Figure 4: Of Those Senior Executives Who Collaborate with Others to
Achieve Crosscutting Goals to a "Very Great" or "Great" Extent,
Percentage Who Felt They Are Recognized to a "Very Great" or "Great"
Extent:
Figure 5: Percentage of SES Plans in HHS with Performance Expectations
Related to Collaboration:
Figure 6: Percentage of SES Plans in Education with Performance
Expectations Related to Collaboration:
Figure 7: Of the Senior Executives Who Felt Their Agency Formally
Provides Performance Information That Allows Them to Track Their Work
Unit's Performance, Percentage Who Felt This Information Was Useful,
Available, or Both to a "Very Great" or "Great" Extent:
Figure 8: Of Those Senior Executives Who Took Action on Areas of
Improvement to a "Very Great" or "Great" Extent, Percentage Who Felt
They Are Recognized to a "Very Great" or "Great" Extent:
Figure 9: Of Those Senior Executives Who Felt the Competencies They
Demonstrate Help Them Contribute to Organizational Goals to a "Very
Great" or "Great" Extent, Percentage Who Felt They Are Recognized to a
"Very Great" or "Great" Extent:
Figure 10: Percentage of Senior Executives Reporting They "Strongly
Agree" or "Agree" That They Are Rewarded for Accomplishments:
Figure 11: Percentage of Senior Executives Reporting That They
Understand the Criteria Used to Award Bonuses by Extent:
Figure 12: Percentage of NASA Senior Executives by Rating Level in the
2003 Performance Appraisal Cycle:
Figure 13: Of Those Senior Executives Who Said They Had the Opportunity
to Be Involved, Percentage Who Said They Have Been Involved in Refining
Their Agency's SES Performance Management System:
Figure 14: Of Those Senior Executives Who Said Formal Training Is
Available, Percentage Who Said They Have Participated in Formal
Training on Their Agency's SES Performance Management System:
Figure 15: Percentage of Senior Executives at HHS Reporting Involvement
and Training Opportunities by Extent:
Figure 16: Percentage of Senior Executives at NASA Reporting
Involvement and Training Opportunities by Extent:
Figure 17: Percentage of Senior Executives at Education Reporting
Involvement and Training Opportunities by Extent:
Figure 18: Percentage of Senior Executives Who Felt Their Agency's SES
Performance Management System Helped to Maintain a Consistent Focus on
Organizational Goals during Transitions by Extent:
Abbreviations:
CDC: Centers for Disease Control and Prevention:
EO: equal opportunity:
FDA: Food and Drug Administration:
GPRA: Government Performance and Results Act of 1993:
HHS: Department of Health and Human Services:
NASA: National Aeronautics and Space Administration:
OMB: Office of Management and Budget:
OPM: Office of Personnel Management:
PRB: performance review board:
SES: Senior Executive Service:
Letter
May 26, 2004:
The Honorable George V. Voinovich:
Chairman:
Subcommittee on Oversight of Government Management, the Federal
Workforce, and the District of Columbia:
Committee on Governmental Affairs:
United States Senate:
The Honorable Jo Ann Davis:
Chairwoman:
Subcommittee on Civil Service and Agency Organization:
Committee on Government Reform:
House of Representatives:
High-performing organizations have recognized that effective
performance management systems can help them drive internal change and
achieve external results.[Footnote 1] Further, such organizations
understand that they need senior leaders who are held accountable for
results, drive continuous improvement, and stimulate and support
efforts to integrate human capital approaches with organizational goals
and related transformation issues. We previously reported that
significant opportunities exist to strengthen agencies' efforts to hold
senior executives accountable for results through their performance
management systems.[Footnote 2] In particular, more progress is needed
in explicitly linking senior executives' performance expectations to
contributing to the achievement of results-oriented organizational
goals, fostering the necessary collaboration both within and across
organizational boundaries to achieve results, and demonstrating a
commitment to lead and facilitate change.
Recently, Congress and the administration have sought to modernize
senior executive performance management systems. Congress established a
new performance-based pay system for members of the Senior Executive
Service (SES) that is designed to provide a clear and direct linkage
between SES performance and pay. An agency can raise the pay cap for
its senior executives to $158,100 in 2004, with a senior executive's
total compensation not to exceed $203,000, if the Office of Personnel
Management (OPM) certifies and the Office of Management and Budget
(OMB) concurs that the agency's performance management system, as
designed and applied, makes meaningful distinctions based on relative
performance. OPM and OMB are to issue regulations prescribing the
requirements agencies must meet to obtain certification for these
purposes. In a memo to the heads of departments and agencies requesting
their comments on the draft proposed regulations outlining the
certification criteria, the Director of OPM stated that OPM and OMB
plan to fully implement the regulations in time for the fiscal year
2004 performance ratings and pay adjustments for the senior
executives.[Footnote 3] In addition, as part of the administration's
President's Management Agenda, OPM set a goal for 15 percent of the
agencies to link performance appraisals for senior executives to the
organization's mission and goals, and use their senior executive
performance management systems to make meaningful distinctions and
provide consequences based on performance by July 2004.
At your request, this report assesses how well selected agencies are
creating linkages between senior executive performance and
organizational success through their career senior executive
performance management systems. We selected the Department of
Education, the Department of Health and Human Services (HHS), and the
National Aeronautics and Space Administration (NASA) based on several
factors, including mission, size, organizational structure, and use of
their performance management systems for their career senior
executives. Within HHS, we selected the Food and Drug Administration
(FDA) and the Centers for Disease Control and Prevention (CDC) to
determine how HHS's senior executive performance management system
cascades down to these operating divisions.
To meet this objective, we assessed how these agencies' career senior
executive performance management systems apply nine key practices for
effective performance management that we previously identified based on
public sector organizations' experiences both here and abroad.[Footnote
4] These practices are as follows.
1. Align individual performance expectations with organizational goals.
2. Connect performance expectations to crosscutting goals.
3. Provide and routinely use performance information to track
organizational priorities.
4. Require follow-up actions to address organizational priorities.
5. Use competencies to provide a fuller assessment of performance.
6. Link pay to individual and organizational performance.
7. Make meaningful distinctions in performance.
8. Involve employees and stakeholders to gain ownership of performance
management systems.
9. Maintain continuity during transitions.
We found that collectively these key practices create a "line of sight"
showing how unit and individual performance can contribute to overall
organizational goals and helping individuals understand the connection
between their daily activities and the organization's success.
We analyzed the agencies' SES performance management systems' policies
and guidance and other related documents; interviewed cognizant agency
officials; assessed a sample of career senior executives' individual
performance plans, which outline the performance expectations
executives are to achieve during the year; analyzed aggregate senior
executive performance rating and bonus data; and surveyed all career
senior executives in each agency to gain information on their
experiences and perceptions with regard to their senior executive
performance management systems.[Footnote 5] We assessed the reliability
of the senior executive performance rating and bonus data provided by
Education, HHS, NASA, and OPM and determined that the data were
sufficiently reliable for the purposes of this report. Information on
the experiences and progress of the selected agencies should prove
helpful to these agencies as well as provide valuable insights to other
agencies as they seek to use senior executive performance management
systems as a tool to drive internal change and achieve external
results. We are using these practices to inform our internal senior
executive performance management system.
We conducted our work from August 2003 through March 2004 in accordance
with the generally accepted government auditing standards. Appendix I
provides additional information on our scope and methodology. Appendix
II provides the complete survey results for each agency. Appendix III
provides information on selected elements of Education's, HHS's, and
NASA's SES performance management systems.
Results in Brief:
Education, HHS, and NASA have undertaken important and valuable efforts
to link their career senior executive performance management systems to
their organizations' success; however, there are opportunities to use
these systems more strategically to manage their organizations and
achieve organizational goals. Our review of senior executives'
performance plans showed that Education, HHS, and NASA have begun to
implement key practices to develop effective performance management
systems for their career senior executives. Specifically, we found the
following.
* All senior executives' performance plans in these agencies identified
individual performance expectations that aligned with organizational
goals. As a next step, setting specific levels of performance that are
linked to these organizational goals can help senior executives see how
they directly contribute to organizational results. While about 80
percent of senior executives in HHS have set specific levels of
performance linked to organizational goals in their individual
performance plans, only about 5 percent of senior executives in
Education and about 1 percent of senior executives in NASA have set
specific levels of performance linked to organizational goals.
* About two-thirds of senior executives' performance plans in HHS and
about one-third in Education identified a specific programmatic
crosscutting goal for collaboration. All senior executives' performance
plans in NASA included a general goal to achieve the mission of the
organization. As a next step, identifying the relevant internal or
external organizations with which they would collaborate can reinforce
a focus across organizational boundaries. About one-third or less of
senior executives at each of these agencies clearly identified the
specific internal or external organization(s) with which they would
collaborate to achieve crosscutting goals.
* All the performance plans of senior executives in NASA and almost all
in Education included competencies that are to address the achievement
of organizational results, employee perspectives, and customer
satisfaction. In HHS, about 94 percent of executives' plans identified
competencies related to organizational results, about 89 percent
related to employee perspectives, and about 61 percent related to
customer satisfaction.
* At Education, approximately 98 percent of senior executives' plans
identified a performance expectation related to leading and
facilitating change, while approximately 25 percent of the executives'
plans at HHS and almost none at NASA identified such an expectation.
In addition, the agencies can use their senior executive performance
management systems to strengthen the link between their senior
executives' performance and their organizations' success by making
meaningful distinctions in performance through ratings and performance
awards (bonuses).
* While about 86 percent of HHS's senior executives received the
highest rating in fiscal year 2003, HHS has restricted the percentage
of senior executives who receive bonuses to generally no more than one-
third at each operating division each year since fiscal year 2001.
* About three-fourths of NASA's senior executives received its highest
rating, and about 52 percent of its senior executives received bonuses
in its 2003 performance appraisal cycle.
* Nearly all of Education's senior executives received its highest
rating, and about 63 percent of senior executives received bonuses in
its 2003 performance appraisal cycle.
As a point of comparison, across the executive branch, agencies rated
about 75 percent of senior executives at the highest levels their
systems permitted, and approximately 49 percent of senior executives
received bonuses in fiscal year 2002, the most current year for which
data are available. The Director of OPM stated that while a growing
number of agencies have improved their distribution of ratings and
bonuses, these governmentwide data also suggest that more work is
needed. In addition, executive branch agencies can reward senior
executives' performance in other ways, such as nominations for
Presidential Rank Awards or other informal or honorary awards.
As reported through our survey, senior executives' perceptions
underscore that their agencies have opportunities to use their systems
more strategically.
* Generally, less than half of the senior executives at each agency
feel that their agency uses its performance management system to the
fullest extent possible, specifically by using the system as a tool to
manage the organization or to achieve organizational goals to a very
great or great extent.
* Less than half of the senior executives at each agency feel that
their performance management system is fully used to provide candid and
constructive feedback to help them maximize their contributions to
organizational goals to a very great or great extent.
* Of the senior executives who reported that their agency provided
performance information to track their work unit's performance, about
39 percent at NASA, about 33 percent at HHS, and about 31 percent at
Education found the performance information to be available when they
need it and useful for making improvements in their work unit's
performance to a very great or great extent.
* Of the senior executives who indicated that they took action to a
very great or great extent on areas of improvement based on the
performance information provided by their agency, about 65 percent at
NASA, about 60 percent at HHS, and about 55 percent at Education felt
they were recognized to a very great or great extent through their
performance management systems for taking such actions.
* Senior executives at these three agencies were involved in refining
their performance management systems or participated in formal training
when given the opportunity. However, at all three agencies, at least
one-third of senior executives reported that they had no opportunity
for such involvement, and about one-fourth reported that no formal
training was available to them on their agency's performance management
system.
We provided a draft of this report to the Secretaries of Education and
HHS and the Administrator of NASA for their review and comment. In
addition, we provided a draft of the report to the Directors of OPM and
OMB for their information. We received written comments from Education,
HHS, and NASA, which are presented in appendixes IV, V, and VI. NASA's
Deputy Administrator stated that NASA concurred with all the
recommendations and plans to implement the recommendations in its next
SES appraisal cycle beginning July 1, 2004. HHS's Acting Principal
Deputy Inspector General stated that HHS had no comments upon review of
the draft report.
In responding to our recommendations, Education's Assistant Secretary
for Management and Chief Information Officer stated that Education
plans to revise its existing senior executive performance management
system dramatically given OPM's draft regulations for the new SES pay
for performance system and described specific actions Education plans
to take. These actions are generally consistent with our
recommendations and their successful completion will be important to
achieving the intent of our recommendations. While Education's actions
are important steps, we disagree that Education has fully implemented
our recommendation to provide performance information to help senior
executive decision making and does not need to implement our
recommendation to require senior executives to identify crosscutting
goals and relevant internal or external organizations to achieve them.
Background:
In November 2003, Congress authorized a new performance-based pay
system for members of the SES.[Footnote 6] According to OPM's interim
regulations, SES members are to no longer receive annual across-the-
board or locality pay adjustments with the new pay system. Agencies are
to base pay adjustments for SES members on individual performance and
contributions to the agency's performance by considering such things as
the unique skills, qualifications, or competencies of the individual
and their significance to the agency's mission and performance, as well
as the individual's current responsibilities.
Specifically, the revised pay system, which took effect in January
2004, replaces the six SES pay levels with a single, open-range pay
band and raises the pay cap for all SES members to $145,600 in 2004
(Level III of the Executive Schedule) with a senior executive's total
compensation not to exceed $175,700 in 2004 (Level I of the Executive
Schedule). If OPM certifies and OMB concurs that the agency's
performance management system, as designed and applied, makes
meaningful distinctions based on relative performance, an agency can
raise the SES pay cap to $158,100 in 2004 (Level II of the Executive
Schedule) with a senior executive's total compensation not to exceed
$203,000 in 2004 (the total annual compensation payable to the Vice
President).
In an earlier step, to help agencies hold senior executives accountable
for organizational results, OPM amended regulations for senior
executive performance management in October 2000. These amended
regulations governing performance appraisals for senior executives
require agencies 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 of
1993 (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. Agencies were to establish these
performance management systems by their 2001 senior executive
performance appraisal cycles.
Performance Management Systems Can Be Used More Strategically by
Selected Agencies:
High-performing organizations have recognized that their performance
management systems are strategic tools to help them manage on a day-to-
day basis and achieve organizational goals. While Education, HHS, and
NASA have undertaken important and valuable efforts to link their
career senior executive performance management systems to their
organizations' success, senior executives' perceptions indicate that
these three agencies have opportunities to use their career senior
executive performance management systems more strategically to
strengthen that link. Based on our survey of career senior executives,
we estimate that generally less than half of the senior executives at
Education, HHS, and NASA feel that their agencies' are fully using
their performance management systems as a tool to manage the
organization or to achieve organizational goals, as shown in figure 1.
Figure 1: Percentage of Senior Executives Responding to a "Very Great"
or "Great" Extent on Their Agencies' Overall Use of Their SES
Performance Management Systems:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
Senior executives in NASA and HHS who have served for less than 1 year
were more likely to respond "no basis to judge/not applicable." This
was not an issue for Education since fewer senior executives have
served less than 1 year.
[End of figure]
Further, effective performance management systems are not merely used
for once-or twice-yearly individual expectation setting and rating
processes. These systems facilitate two-way communication throughout
the year so that discussions about individual and organizational
performance are integrated and ongoing. Effective performance
management systems work to achieve three key objectives: (1) they
strive to provide candid and constructive feedback to help individuals
maximize their contribution and potential in understanding and
realizing the goals and objectives of the organization, (2) they seek
to provide management with the objective and fact-based information it
needs to reward top performers, and (3) they provide the necessary
information and documentation to deal with poor performers. In this
regard as well, generally less than half of the senior executives felt
that their agencies are fully using their performance management
systems to achieve these objectives, as shown in figure 2.
Figure 2: Percentage of Senior Executives Responding to a "Very Great"
or "Great" Extent on Their Agencies' Use of Their SES Performance
Management Systems to Meet Key Objectives:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
Senior executives in NASA and HHS who have served for less than 1 year
were more likely to respond "no basis to judge/not applicable." This
was not an issue for Education since fewer senior executives have
served less than 1 year.
[End of figure]
Selected Agencies Can Strengthen the Link between Senior Executive
Performance and Organizational Success:
High-performing organizations have recognized that a critical success
factor in fostering a results-oriented culture is a performance
management system that creates a "line of sight" showing how unit and
individual performance can contribute to overall organizational goals
and helping them understand the connection between their daily
activities and the organization's success. Further, our prior work has
identified nine key practices public sector organizations both here and
abroad have used that collectively create this line of sight to develop
effective performance management systems.[Footnote 7] To this end,
while Education, HHS, and NASA have begun to apply the key practices to
develop effective performance management systems for their career
senior executives, they have opportunities to strengthen the link
between their senior executives' performance and organizations'
success.
Align Individual Performance Expectations with Organizational Goals:
An explicit alignment of daily activities with broader results is one
of the defining features of effective performance management systems in
high-performing organizations. These organizations use their
performance management systems to improve performance by helping
individuals see the connection between their daily activities and
organizational goals and encouraging individuals to focus on their
roles and responsibilities to help achieve these goals. Education, HHS,
and NASA require their senior executives to align individual
performance with organizational goals in order to hold them accountable
for organizational results. Our review of the senior executives'
performance plans showed that all the plans at each agency identified
individual performance expectations that aligned with organizational
goals. In addition, nearly all of the senior executives at each agency
have reported that they communicate their performance expectations to
at least a small extent to those whom they supervise. Cascading
performance expectations in this way helps individuals understand how
they contribute to organizational goals.
Still, while most senior executives at each agency indicated that they
see a connection between their daily activities and organizational
goals to a very great or great extent, fewer of these senior executives
felt that their agency's SES performance management system holds them
accountable for their contributions to organizational results to a very
great or great extent, as shown in figure 3.
Figure 3: Of Those Senior Executives Who See a Connection between Daily
Activities and Organizational Goals to a "Very Great" or "Great"
Extent, Percentage Who Felt That Their System Holds Them Accountable to
a "Very Great" or "Great" Extent:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
The 95 percent confidence interval for the 50 percent of SES at
Education ranges from 40 to 60 percent, and for HHS, the 58 percent of
SES ranges from 53 to 62 percent.
[End of figure]
These responses are generally consistent with our governmentwide
surveys on the implementation of GPRA. In particular, governmentwide,
senior executives have consistently reported that they are held
accountable for results. Most recently, we reported in March 2004 that
61 percent of senior executives governmentwide feel they are held
accountable for achieving their agencies' strategic goals to a very
great or great extent.[Footnote 8]
To reinforce the accountability for achieving results-oriented goals,
we have reported that more progress is needed in explicitly linking
senior executives' performance expectations to the achievement of these
goals.[Footnote 9] Setting specific levels of performance that are
linked to organizational goals can help senior executives see how they
directly contribute to organizational results. While most senior
executives at HHS have set specific levels of performance in their
individual performance plans, few senior executives in Education and
NASA have identified specific levels.
HHS requires its senior executives to set measurable performance
expectations in their individual performance plans that align with
organizational priorities, such as the department's "One-HHS"
objectives and strategic goals and their operating divisions' annual
performance goals or other priorities.[Footnote 10] We found that about
80 percent of senior executives' performance plans identified specific
levels of performance linked to organizational goals. For example, a
senior executive in CDC set an expectation to "reduce the percentage of
youth (grade 9-12) who smoke to 26. 5%," which contributes to CDC's
annual performance goal to "reduce cigarette smoking among youth" and
the One-HHS program objective to "emphasize preventive health measures
(preventing disease and illness)." However, specifying levels of
performance varies across operating divisions. We found that
approximately 63 percent of senior executives at FDA versus 80 percent
at CDC identified specific levels of performance linked to
organizational goals in their individual performance plans.
Education requires its senior executives to include critical elements,
each with specific performance requirements, in their individual
performance plans that align with the department's goals and
priorities, including the President's Management Agenda, the
Secretary's strategic plan, the Blueprint for Management Excellence,
and the Culture of Accountability. We found that approximately 5
percent of senior executives' performance plans identified specific
levels of performance linked to organizational goals.
NASA requires its senior executives to include seven critical elements,
each with specific performance requirements that focus on the
achievement of organizational goals and priorities, in their individual
performance plans. For example, senior executives' performance plans
include the critical element "meets and advances established agency
program objectives and achieves high-quality results," and specifically
"meets appropriate GPRA/NASA Strategic Plan goals and objectives."
Senior executives may modify the performance requirements by making
them more measurable or specific to their jobs; however, only about 23
percent of senior executives added performance requirements that are
specific to their positions in their individual performance
plans.[Footnote 11] Also, about 1 percent of senior executives have
performance expectations with specific levels of performance that are
related to organizational goals in their individual plans.
Connect Performance Expectations to Crosscutting Goals:
As public sector organizations shift their focus of accountability from
outputs to results, they have recognized that the activities needed to
achieve those results often transcend specific organizational
boundaries. Consequently, organizations that focus on collaboration,
interaction, and teamwork across organizational boundaries are
increasingly critical to achieve results. In a recent GAO forum,
participants agreed that delivering high performance and achieving
goals requires agencies to establish partnerships with a broad range of
federal, state, and local government agencies as well other relevant
organizations.[Footnote 12] High-performing organizations use their
performance management systems to strengthen accountability for
results, specifically by placing greater emphasis on collaboration to
achieve results.
While most senior executives in each agency indicated that they
collaborate with others to achieve crosscutting goals, fewer of these
senior executives felt that their contributions to crosscutting goals
are recognized through their agency's system, as shown in figure 4.
Figure 4: Of Those Senior Executives Who Collaborate with Others to
Achieve Crosscutting Goals to a "Very Great" or "Great" Extent,
Percentage Who Felt They Are Recognized to a "Very Great" or "Great"
Extent:
[See PDF for image]
Note: Based on GAO survey of career senior executives.
[End of figure]
We reported that more progress is needed to foster the necessary
collaboration both within and across organizational boundaries to
achieve results.[Footnote 13] As a first step, agencies could have
senior executives identify specific programmatic crosscutting goals
that would require collaboration to achieve in their individual
performance plans. As a next step, agencies could have senior
executives name the relevant internal or external organizations with
which they would collaborate to reinforce a focus across organizational
boundaries. HHS, Education, and NASA are connecting performance
expectations to crosscutting goals to varying degrees.
While HHS does not require executives to identify programmatic
crosscutting goals specific to the individuals in their performance
plans, according to an agency official, it holds all senior executives
accountable for the crosscutting One-HHS program objectives, such as to
increase access to health care. We found that about 67 percent of
senior executives' performance plans identified a programmatic
crosscutting goal that would require collaboration to achieve, as shown
in figure 5. The extent to which the senior executives' performance
plans identified crosscutting goals varied across operating divisions.
For example, 60 percent of the senior executives' plans in FDA
identified crosscutting goals compared with 50 percent of the plans in
CDC. Few HHS senior executives clearly identified the specific
organization(s) either internal or external with which they would
collaborate.
Figure 5: Percentage of SES Plans in HHS with Performance Expectations
Related to Collaboration:
[See PDF for image]
Note: GAO analysis based on review of career senior executives'
performance plans.
[End of figure]
Positive examples of senior executives' plans at HHS that included
crosscutting goals, as well as either the internal or external
organizations with which they would collaborate to achieve these goals,
include the following:
* A senior executive in the National Institutes of Health set an
expectation to work with FDA and other agencies and organizations to
accelerate drug development by specifically working on the National
Cancer Institute/FDA task force to eliminate barriers and speed
development.
* A senior executive in the Substance Abuse and Mental Health Services
Administration set an expectation to work collaboratively with the
Office of National Drug Control Policy, the Department of Energy, and
the Office of Juvenile Justice and Delinquency Prevention to increase
the use of the National Registry of Effective Programs in other federal
agencies to identify and provide for early intervention for persons
with or who are at risk for mental health or substance abuse problems.
As required by Education, all senior executives' performance plans
included the general performance expectation: "promotes collaboration
and teamwork, including effective union-management relations, where
appropriate." However, only about 32 percent of senior executives'
performance plans identified programmatic crosscutting goals on which
they would collaborate and few executives clearly identified the
specific organizations with which they would collaborate, as shown in
figure 6.
Figure 6: Percentage of SES Plans in Education with Performance
Expectations Related to Collaboration:
[See PDF for image]
Note: GAO analysis based on review of career senior executives'
performance plans.
[End of figure]
As required by NASA, all senior executives' performance plans included
a general expectation: "integrates One-NASA approach to problem-
solving, program/project management, and decision making. Leads by
example by reaching out to other organizations and NASA centers to
collaborate on work products; seeks input and expertise from a broad
spectrum .—" This expectation is designed to contribute to achieving
NASA's mission. Only about 1 percent of the executives clearly
identified specific centers in NASA and none of the executives clearly
identified specific organizations outside of NASA that they need to
collaborate with to achieve crosscutting goals.
Provide and Routinely Use Performance Information to Track
Organizational Priorities:
High-performing organizations provide objective performance
information to executives to show progress in achieving organizational
results and other priorities, such as customer satisfaction and
employee perspectives, and help them manage during the year, identify
performance gaps, and pinpoint improvement opportunities. We reported
that disaggregating performance information in a useful format could
help executives track their performance against organizational goals
and compare their performance to that of the organization.[Footnote 14]
HHS, NASA, and Education took different approaches to providing
performance information to their senior executives in order to show
progress toward organizational goals or priorities. While all three
agencies give their components the flexibility to collect and provide
performance information to their senior executives, Education also
provides performance information agencywide. Of the senior executives
in Education, HHS, and NASA who reported that their agency provided
performance information to track their work unit's performance,
generally less than half found the performance information to be useful
for making improvements, available when needed, or both to a very great
or great extent, as shown in figure 7.
Figure 7: Of the Senior Executives Who Felt Their Agency Formally
Provides Performance Information That Allows Them to Track Their Work
Unit's Performance, Percentage Who Felt This Information Was Useful,
Available, or Both to a "Very Great" or "Great" Extent:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
These responses are based on the 88 percent of senior executives at
Education, 84 percent at HHS, and 93 percent at NASA who reported that
their agencies provided performance information that allows them to
track their work unit's performance. Senior executives in HHS who have
served for less than 1 year were more likely to respond "no basis to
judge/not applicable."
[End of figure]
Education provides various types of performance information to senior
executives intended to help them see how they are meeting the
performance expectations in their individual performance plans. A
tracking system monitors how Education is making progress toward its
annual performance goals and supporting action steps. Each action step
has milestones that are tracked and reported each month to the
officials who developed and have "ownership" for them. Education also
collects performance information on customer service and employee
perspectives. For example, Education uses an automated performance
feedback process, whereby customers, coworkers, and employees provide
feedback at midcycle and the end of the performance appraisal cycle on
how the senior executives are meeting their individual performance
expectations and areas for improvement.[Footnote 15]
HHS conducts an annual departmentwide quality of work life survey and
disaggregates the survey results for executives and other employees to
use. HHS compares the overall high or low results of its survey for HHS
as a whole to each operating division and to the component
organizations within operating divisions. In the 2003 survey, HHS added
questions about the President's Management Agenda, and each operating
division had the opportunity to add specific questions focusing on
issues that it believed were important to its employees, such as
flexible work schedules or knowledge management issues. In addition,
HHS gives operating divisions the flexibility to use other means of
collecting and providing performance information, and in turn, FDA and
CDC give their centers and offices the flexibility to collect and
provide performance information. For example, according to a CDC
official, senior executives receive frequent reports, such as the
weekly situation reports, to identify priorities and help communicate
these priorities among senior executives.[Footnote 16] In addition, CDC
conducts a "pulse check" survey to gather feedback on employees'
satisfaction with the agency and disaggregates the results to the
center level. According to an agency official, CDC plans to conduct
this survey quarterly.
An official at NASA indicated that while NASA does not systematically
provide performance information to its senior executives on a NASA-wide
basis, the centers have the flexibility to collect and provide
performance information to their senior executives on programs' goals
and measures and customer and employee satisfaction. This official
indicated that NASA uses the results of the OPM Human Capital survey to
help identify areas for improvement throughout NASA and its centers.
NASA provides the OPM Human Capital survey data to its centers, showing
NASA-wide and center-specific results, to help centers conduct their
own analyses and identify areas for improvement and best practices.
Require Follow-up Actions to Address Organizational Priorities:
High-performing organizations require individuals to take follow-up
actions based on the performance information available to them. By
requiring and tracking such follow-up actions on performance gaps,
these organizations underscore the importance of holding individuals
accountable for making progress on their priorities. Within Education,
only the senior executives who developed the action steps for the
annual performance goals are to incorporate expectations to demonstrate
progress toward the goal(s) in their individual plans. HHS and NASA do
not require senior executives to take follow-up actions agencywide, but
they encourage their components to have executives take follow-up
actions to show progress toward the organizational priorities. Of the
senior executives at each agency who indicated that they took follow-up
actions on areas of improvement, generally less than two-thirds felt
they were recognized through their performance management systems for
such actions, as shown in figure 8.
Figure 8: Of Those Senior Executives Who Took Action on Areas of
Improvement to a "Very Great" or "Great" Extent, Percentage Who Felt
They Are Recognized to a "Very Great" or "Great" Extent:
[See PDF for image]
Notes: Based on GAO survey of career senior executives. For Education,
the 55 percent of SES has a margin of error of ±12 percent. For HHS,
the 60 percent of SES who said they feel recognized for taking follow-
up actions has a margin of error of ±5 percent. Senior executives in
NASA and HHS who have served for less than 1 year were more likely to
respond "no basis to judge/not applicable." This was not an issue for
Education since fewer senior executives have served less than 1 year.
[End of figure]
At Education, senior executives who developed the action steps for
Education's annual goals are required to set milestones that are
tracked each month using a red, yellow, or green scoring system; assess
how they are progressing toward the action steps and annual goals; and
revise future milestones, if necessary. According to agency officials,
these senior executives are to incorporate these action steps when
developing their individual performance plans. Senior executives are
also to address the feedback that their supervisors provide about their
progress in achieving their performance expectations.
HHS as a whole does not require senior executives to take follow-up
actions, for example, on the quality of work life survey results, or
incorporate the performance information results into their individual
performance plans. In addition, FDA and CDC do not require their senior
executives agencywide to take any type of follow-up actions. However,
FDA centers have the flexibility to require their senior executives to
identify areas for improvement based on the survey results or other
types of performance information. Similarly, CDC encourages its
executives to incorporate relevant performance measures in their
individual performance plans. For example, those senior executives
within each CDC center responsible for issues identified at emerging
issues meetings are required to identify when the issues will be
resolved, identify the steps they will take to resolve the issues in
action plans, and give updates at future meetings with the CDC Director
and other senior officials.
NASA does not require its senior executives to take follow-up actions
agencywide on the OPM Human Capital Survey data or other types of
performance information, rather it encourages its centers to have their
executives take follow-up action on any identified areas of
improvement. However, an agency official stated that NASA uses the
results of the survey to identify areas for improvement and that
managers are ultimately accountable for ensuring the implementation of
the improvement initiatives.
Use Competencies to Provide a Fuller Assessment of Performance:
High-performing organizations use competencies to examine individual
contributions to organizational results. Competencies, which define the
skills and supporting behaviors that individuals are expected to
demonstrate to carry out their work effectively, can provide a fuller
picture of individuals' performance in the different areas in which
they are appraised, such as organizational results, employee
perspectives, and customer satisfaction. We have reported that core
competencies applied organizationwide can help reinforce behaviors and
actions that support the organization's mission, goals, and values and
can provide a consistent message about how employees are expected to
achieve results.[Footnote 17] Education and NASA identified
competencies that all senior executives in the agency must include in
their performance plans, while HHS gave its operating divisions the
flexibility to have senior executives identify competencies in their
performance plans.
Most of the senior executives in each agency indicated that the
competencies they demonstrate help them contribute to the
organization's goals to a very great or great extent. However, fewer of
these executives felt that they were recognized through their
performance management system for demonstrating these competencies, as
shown in figure 9.
Figure 9: Of Those Senior Executives Who Felt the Competencies They
Demonstrate Help Them Contribute to Organizational Goals to a "Very
Great" or "Great" Extent, Percentage Who Felt They Are Recognized to a
"Very Great" or "Great" Extent:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
Senior executives in NASA and HHS who have served for less than 1 year
were more likely to respond "no basis to judge/not applicable." This
was not an issue for Education since fewer senior executives have
served less than 1 year.
[End of figure]
Education requires all senior executives to include a set of
competencies in their individual performance plans. Based on our review
of Education's senior executives' performance plans, we found that all
of the plans, unless otherwise noted, included the following examples
of competencies.[Footnote 18]
* Organizational results--"sets and meets challenging objectives to
achieve the Department's strategic goals."
* Employee perspectives--"fosters improved workforce productivity and
effective development and recognition of employees."[Footnote 19]
* Customer satisfaction--"anticipates and responds to customer needs in
a professional, effective, and timely manner."
NASA requires all senior executives to include a set of competency-
based critical elements in their individual performance plans. Based on
our review of NASA's senior executives' performance plans, we found all
of the plans included the following examples of competencies.
* Organizational results--Understands the principles of the President's
Management Agenda and actively applies them; capitalizes on
opportunities to integrate human capital issues in planning and
performance and to expand e-government and competitive sourcing; and
pursues other opportunities to reduce costs and improve service to
customers.
* Employee perspectives--Demonstrates a commitment to equal opportunity
and diversity by proactively implementing programs that positively
impact the workplace and NASA's external stakeholders and through
voluntary compliance with equal opportunity laws, regulations,
policies, and practices.
* Customer satisfaction--Provides the appropriate level of high-quality
support to peers and other organizations to enable the achievement of
the NASA mission; results demonstrate support of One-NASA and that
stakeholder and customer issues were taken into account.
According to an HHS official, the HHS senior executive performance
management system, while not competency based, is becoming more outcome
oriented. However, operating divisions may require senior executives to
include competencies. For example, senior executives in FDA and CDC
include specific competencies related to organizational results,
employee perspectives, and customer satisfaction in their individual
performance plans. Based on our review of HHS's senior executives'
performance plans, we found that all of the plans at FDA and CDC and
nearly all across HHS identified competencies that executives are
expected to demonstrate.
* Organizational results--About 94 percent of HHS senior executives'
plans identified a competency related to organizational results. For
example, all senior executives' plans in FDA included a competency to
"demonstrate prudence and the highest ethical standards when executing
fiduciary responsibilities."
* Employee perspectives--About 89 percent of HHS senior executives'
plans identified a competency related to employee perspectives. For
example, senior executives in CDC are required to include a competency
to exercise leadership and management actions that reflect the
principles of workforce diversity in management and operations in such
areas as recruitment and staffing, employee development, and
communications.
* Customer satisfaction--About 61 percent of HHS senior executives'
plans identified a competency related to customer satisfaction. For
example, all senior executives' plans in FDA included a competency to
"lead in a proactive, customer-responsive manner consistent with agency
vision and values, effectively communicating program issues to external
audiences."
Link Pay to Individual and Organizational Performance:
High-performing organizations seek to create pay, incentive, and reward
systems that clearly link employee knowledge, skills, and contributions
to organizational results. These organizations recognize that valid,
reliable, and transparent performance management systems with
reasonable safeguards for employees are the precondition to such an
approach. To this end, Education's, HHS's, and NASA's performance
management systems are designed to appraise and reward senior executive
performance based on each executive's achievement toward organizational
goals as outlined in the executive's performance plan. Overall, the
majority of senior executives at each agency either strongly agreed or
agreed that they are rewarded for accomplishing the performance
expectations in their individual performance plan or helping their
agency accomplish its goals, as shown in figure 10. These responses are
similar to those from our governmentwide survey on the implementation
of GPRA. We reported that about half of senior executives
governmentwide perceive to a very great or great extent that employees
in their agencies received positive recognition for helping their
agencies accomplish their strategic goals.[Footnote 20]
Figure 10: Percentage of Senior Executives Reporting They "Strongly
Agree" or "Agree" That They Are Rewarded for Accomplishments:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
[End of figure]
Senior executives in NASA and HHS who have served for less than 1 year
were more likely to respond "no basis to judge/not applicable." This
was not an issue for Education since fewer senior executives have
served less than 1 year.
We have observed that a performance management system should have
adequate safeguards to ensure fairness and guard against abuse. Such
safeguards will become especially important under the new performance-
based pay system for the SES. Education, HHS, and NASA have built the
following safeguards required by OPM into their senior executive
performance management policies.
* Each agency must establish one or more performance review boards
(PRB) to review senior executives' initial summary performance ratings
and other relevant documents and to make written recommendations to the
agency head on the performance of the agency's senior executives. The
PRBs are to have members who are appointed by the agency head in a way
that assures consistency, stability, and objectivity in senior
executive performance appraisals. For example, HHS specifically states
that each operating division will have one or more PRBs with members
appointed by the operating division head. HHS's PRB members may include
all types of federal executives, including noncareer appointees,
military officers, and career appointees from within and outside the
department. In addition, NASA's PRB is to evaluate the effectiveness of
the senior executive performance management system and report its
findings and any appropriate recommendations for process improvement or
appropriate policy changes to NASA management. For example, the PRB
completed a study on NASA's senior executive bonus system in 2003.
* A senior executive may provide a written response to his or her
initial summary rating that is provided to the PRB. The PRB is to
consider this written response in recommending an annual summary rating
to the agency head.
* A senior executive may ask for a higher-level review of his or her
initial summary rating before the rating is provided to the PRB. The
higher-level reviewer cannot change the initial summary rating, but may
recommend a different rating to the PRB that is shared with the senior
executive and the supervisor. Upon receiving the annual summary rating,
senior executives may not appeal their performance appraisals and
ratings.
We have observed that a safeguard for performance management systems is
to ensure reasonable transparency and appropriate accountability
mechanisms in connection with the performance management process.
Agencies can help create transparency in the performance management
process by communicating the overall results of the performance
appraisal cycle to their senior executives. Education, NASA, and HHS
officials indicated that they do not make the aggregate distribution of
performance ratings or bonuses available to their senior executives.
In addition, agencies can communicate the criteria for making
performance-based pay decisions and bonus decisions to their senior
executives to enhance the transparency of the system. Generally, less
than half of the senior executives at each agency reported that they
understand the criteria used to award bonuses to a very great or great
extent, and some senior executives at each agency reported that they do
not understand the criteria at all, as shown in figure 11.
Figure 11: Percentage of Senior Executives Reporting That They
Understand the Criteria Used to Award Bonuses by Extent:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
For Education, the percentage of senior executives does not equal 100
percent due to rounding, and for HHS and NASA, due to the senior
executives who responded "no basis to judge/not applicable." Senior
executives in HHS who have served for less than 1 year were more likely
to respond "no basis to judge/not applicable."
[End of figure]
Make Meaningful Distinctions in Performance:
High-performing organizations make meaningful distinctions between
acceptable and outstanding performance of individuals and appropriately
reward those who perform at the highest level. Executive agencies can
reward senior executives' performance in a number of ways: through
performance awards or bonuses, nominations for Presidential Rank
Awards, or other informal or honorary awards. With the new performance-
based pay system for senior executives, agencies are required to have
OPM certify and OMB concur that their performance management systems
are making meaningful distinctions based on relative performance in
order to raise the pay for their senior executives to the highest
available level.
Recently, the Director of OPM stated that agencies' SES performance
management systems should rely on credible and rigorous performance
measurements to make meaningful distinctions based on relative
performance in order for the new SES performance-based pay system to
succeed.[Footnote 21] She also noted that while a growing number of
agencies have improved in their distributions of SES ratings and awards
based on agencies' fiscal year 2002 rating and bonus data, these data
also suggest that more work is needed. Specifically, see the following:
* Executive branch agencies rated about 75 percent of senior executives
at the highest level their systems permit in their performance ratings
in fiscal year 2002, the most current year for which data are available
from OPM--a decrease from about 84 percent the previous fiscal year.
* When disaggregating the data by rating system, approximately 69
percent of senior executives received the highest rating under five-
level systems in fiscal year 2002 compared to about 76 percent in
fiscal year 2001, and almost 100 percent of senior executives received
the highest rating under three-level systems in both fiscal years 2001
and 2002.
* Approximately 49 percent of senior executives received bonuses in
fiscal year 2002 compared to about 52 percent the previous fiscal
year.[Footnote 22]
At HHS, about 86 percent of senior executives received the highest
possible rating in fiscal year 2003 compared with approximately 99
percent in fiscal year 2002. While HHS gives its operating divisions
the flexibility to appraise their senior executives' performance using
a three-, four-, or five-level performance management system, most of
HHS's operating divisions, including FDA and CDC, rate their senior
executives under a three-level system. Almost all of HHS's senior
executives rated under a three-level system received the highest rating
of "fully successful" in fiscal years 2002 and 2003. [Footnote 23]
Approximately 23 percent of senior executives rated under a five-level
system received the highest rating of "outstanding" in fiscal year 2003
compared with approximately 94 percent in fiscal year 2002. [Footnote
24]
According to its Chief Human Capital Officer, HHS recognizes that its
rating systems do not always allow for distinctions in senior
executives' performance, and it has chosen to focus on the bonus
process as the method for reflecting performance distinctions. Senior
executive bonuses are to provide a mechanism for distinguishing and
rewarding the contributions of top performers, specifically for
circumstances in which the individual's work has substantially improved
public health and safety or citizen services. Since the fiscal year
2001 performance appraisal cycle, HHS has restricted the percentage of
senior executives' bonuses to generally no more than one-third of each
operating division's senior executives. HHS, including FDA and CDC, is
making progress toward distinguishing senior executive performance
through bonuses compared to the percentage of senior executives
governmentwide who received bonuses, as shown in table 1.
Table 1: Percentage of Senior Executives at HHS as Compared to Senior
Executives Governmentwide Who Received Bonuses for Fiscal Years 2000
through 2003:
Agency: HHS (including CDC and FDA);
FY 2000: 58;
FY 2001: 34;
FY 2002: 37;
FY 2003: 29.
Agency: CDC;
FY 2000: 86;
FY 2001: 52;
FY 2002: 39;
FY 2003: 35.
Agency: FDA;
FY 2000: 72;
FY 2001: 36;
FY 2002: 37;
FY 2003: 34.
Agency: Governmentwide;
FY 2000: 51;
FY 2001: 52;
FY 2002: 49;
FY 2003: Not available.
Sources: HHS and OPM.
Note: The percentage of senior executives governmentwide who received
bonuses in fiscal year 2003 is not yet available.
[End of table]
Additionally, HHS generally limited individual bonus amounts to no more
than 12 percent of base pay for top performers in fiscal year 2003.
Most of the senior executives who received a bonus were awarded less
than a 10 percent bonus in fiscal year 2003, as shown in table 2.
Table 2: Percentage of HHS Senior Executives Who Received Bonuses and
the Bonus Amounts as a Percentage of Base Pay for Fiscal Year 2003:
Bonus amount: 12;
Senior executives who received bonuses: 3.
Bonus amount: 11;
Senior executives who received bonuses: 0.
Bonus amount: 10;
Senior executives who received bonuses: 6.
Bonus amount: 9;
Senior executives who received bonuses: 5.
Bonus amount: 8;
Senior executives who received bonuses: 4.
Bonus amount: 7;
Senior executives who received bonuses: 5.
Bonus amount: 6;
Senior executives who received bonuses: 2.
Bonus amount: 5;
Senior executives who received bonuses: 4.
Bonus amount: Total;
Senior executives who received bonuses: 29.
Source: HHS.
[End of table]
Lastly, senior executive responses to our survey indicated that they
did not feel HHS was making meaningful distinctions in ratings or
bonuses to a very great or great extent. Approximately 31 percent of
senior executives felt that their agency makes meaningful distinctions
in performance using ratings; approximately 38 percent felt that their
agency makes meaningful distinctions in performance using bonuses.
NASA uses a five-level system to appraise senior executive performance.
More than three-fourths of the senior executives received the highest
rating of "outstanding" for the 2003 performance appraisal cycle (July
2002-June 2003), as shown in figure 12. The distribution of senior
executives across the rating levels was similar to the previous
performance appraisal cycle.
Figure 12: Percentage of NASA Senior Executives by Rating Level in the
2003 Performance Appraisal Cycle:
[See PDF for image]
Note: Percentage of senior executives exceeds 100 percent due to
rounding.
[End of figure]
NASA's senior executive bonus recommendations are to be based solely on
exceptional performance as specified and documented in senior
executives' performance plans. While NASA established a fixed
allocation of bonuses for its organizations based on the total number
of senior executives, an organization can request an increase to its
allocation. Sixty percent of eligible senior executives within the
organization's bonus allocation may be recommended for bonuses larger
than 5 percent of base pay.
For the 2003 appraisal cycle, the percentage of senior executives who
received bonuses increased from the previous year, as shown in table 3.
An agency official indicated that this increase resulted from a study
NASA's PRB conducted on the senior executive bonus system. The PRB
reviewed NASA's bonus system in the context of OPM's data on senior
executive bonuses across federal agencies and recommended that NASA
revise its bonus system to move NASA into the upper half of the number
and average amount of bonuses given across federal agencies. According
to the PRB study, NASA made this change to meet its management's need
to reward more senior executives while recognizing that bonus decisions
must be based on performance.
Table 3: Percentage of NASA Senior Executives Who Received Bonuses and
the Bonus Amounts as a Percentage of Base Pay for the 2002 and 2003
Performance Appraisal Cycle:
Bonus amount: 20;
Senior executives who received bonuses: 2002 cycle: 6;
Senior executives who received bonuses: 2003 cycle: 8.
Bonus amount: 15;
Senior executives who received bonuses: 2002 cycle: 6;
Senior executives who received bonuses: 2003 cycle: 11.
Bonus amount: 10;
Senior executives who received bonuses: 2002 cycle: 6;
Senior executives who received bonuses: 2003 cycle: 7.
Bonus amount: 5;
Senior executives who received bonuses: 2002 cycle: 22;
Senior executives who received bonuses: 2003 cycle: 26.
Total;
Senior executives who received bonuses: 2002 cycle: 40;
Senior executives who received bonuses: 2003 cycle: 52.
Source: NASA.
[End of table]
During NASA's 2003 appraisal cycle, the Space Shuttle Columbia accident
happened. We reviewed the aggregate senior executive performance rating
and bonus data for that cycle; however, we did not analyze individual
senior executives' performance appraisals or bonus recommendations or
determine if those who received ratings of outstanding, bonuses, or
both were involved with the Columbia mission.
Lastly, senior executive responses to our survey indicated that about
half of the executives felt NASA was making meaningful distinctions in
ratings or bonuses to a very great or great extent. Approximately 46
percent of senior executives felt that their agency makes meaningful
distinctions in performance using ratings; approximately 48 percent
felt that their agency makes meaningful distinctions in performance
using bonuses.
Education uses a three-level rating system.[Footnote 25] About 98
percent of senior executives received the highest rating of
"successful" in the 2003 performance appraisal cycle (July 2002-June
2003), a slight decrease from the previous performance appraisal cycle
when all senior executives received this rating. Education's senior
executive bonus recommendations are to be based on senior executives'
demonstrated results and accomplishments toward the department's
strategic goals and organizational priorities. About 63 percent of
senior executives received bonuses in the 2003 appraisal cycle,
compared to approximately 60 percent in the previous appraisal cycle.
The majority of the senior executives who received bonuses were awarded
5 percent bonuses in the 2003 appraisal cycle, as shown in table 4.
Table 4: Percentage of Education Senior Executives Who Received Bonuses
and the Bonus Amounts as a Percentage of Base Pay for the 2003
Performance Appraisal Cycle:
Bonus amount: 20;
Senior executives who received bonuses: 7.
Bonus amount: 15-19;
Senior executives who received bonuses: 0.
Bonus amount: 10-14;
Senior executives who received bonuses: 4.
Bonus amount: 6-9;
Senior executives who received bonuses: 15.
Bonus amount: 5;
Senior executives who received bonuses: 37.
Total;
Senior executives who received bonuses: 63.
Source: Department of Education.
[End of table]
Lastly, senior executive responses to our survey indicated that they
did not feel Education was making meaningful distinctions in ratings or
bonuses to a very great or great extent. Specifically, about 10 percent
of senior executives felt that their agency makes meaningful
distinctions in performance using ratings; about 33 percent felt that
their agency makes meaningful distinctions in performance using
bonuses.
Involve Employees and Stakeholders to Gain Ownership of Performance
Management Systems:
High-performing organizations have found that actively involving
employees and stakeholders when developing or refining results-oriented
performance management systems helps improve employees' confidence and
belief in the fairness of the system and increase their understanding
and ownership of organizational goals and objectives. Further, to
maximize the effectiveness of their performance management systems
these organizations recognize that they must conduct frequent training
for staff members at all levels of the organization.[Footnote 26]
Generally, at Education, HHS, and NASA senior executives became
involved in refining the performance management system or participated
in formal training on those systems when provided the opportunities. Of
the senior executives at each agency who reported that they have been
given the opportunity to be involved in refining their agency's
performance management system to at least a small extent, most of these
senior executives said they took advantage of this opportunity, as
shown in figure 13.
Figure 13: Of Those Senior Executives Who Said They Had the Opportunity
to Be Involved, Percentage Who Said They Have Been Involved in Refining
Their Agency's SES Performance Management System:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
The 95 percent confidence interval for the 76 percent of SES at
Education ranges from 63 to 87 percent.
[End of figure]
Similarly, while less than three-fourths of the senior executives at
each agency said formal training on their agency's performance
management system is available to them, most of these senior executives
said they participated in the training, as shown in figure 14.
Figure 14: Of Those Senior Executives Who Said Formal Training Is
Available, Percentage Who Said They Have Participated in Formal
Training on Their Agency's SES Performance Management System:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
The 95 percent confidence interval for the 83 percent of SES at
Education ranges from 73 to 91 percent. For the question on the
availability of training, senior executives in HHS who have served for
less than 1 year were more likely to respond "no basis to judge/not
applicable."
[End of figure]
At all three agencies, a proportion of senior executives reported that
they had no opportunity to become involved with or trained on their
performance management systems. At HHS, about 38 percent of senior
executives said they did not have the opportunity to be involved in
refining their agency's system, while about 24 percent of senior
executives said formal training on their agency's system was not
available to them, as shown in figure 15.
Figure 15: Percentage of Senior Executives at HHS Reporting Involvement
and Training Opportunities by Extent:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
Percentages do not add up to 100 percent due to senior executives who
responded "no basis to judge/not applicable." For the question on
training, senior executives who have served for less than 1 year were
more likely to respond "no basis to judge/not applicable."
[End of figure]
According to an HHS official, the Office of the Secretary developed the
One-HHS objectives, the basis of its senior executive performance
management system, with input from the leadership of all HHS staff
offices and operating divisions. This official indicated that HHS
conducted extensive interviews to develop and validate the goals. All
career senior executives were briefed on the goals and offered training
on development of outcome-oriented individual performance objectives
derived from those goals. The agency official said that the operating
divisions had the flexibility to involve their senior executives in
customizing the new individual performance plans for their operating
divisions.
According to HHS's guidance, the operating divisions are to develop and
provide training on the performance management system to their senior
executives on areas such as developing performance plans, conducting
progress reviews, writing appraisals, and using appraisals as a key
factor in making other management decisions. For example, according to
an FDA official, the Human Resources Director briefed all of the senior
executive directors on how to cascade the FDA Commissioner's
performance plan into their fiscal year 2002 individual plans and
incorporate the One-HHS objectives. FDA does not provide regular
training to the senior executives on the performance management system;
rather the training is provided as needed and usually on a one-on-one
basis when a new senior executive joins FDA. The agency official also
stated that because few senior executives are joining the agency,
regular training on the system is not as necessary.
About half of NASA's senior executives reported that they did not have
the opportunity to be involved in refining their agency's system, while
about 21 percent of senior executives said formal training on their
agency's system was not available to them, as shown in figure 16.
Figure 16: Percentage of Senior Executives at NASA Reporting
Involvement and Training Opportunities by Extent:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
Percentages do not add up to 100 percent due to senior executives who
responded "no basis to judge/not applicable."
[End of figure]
According to an agency official, the NASA Administrator worked with the
top senior executives to develop a common set of senior executive
critical elements and performance requirements that reflect his
priorities and are central to ensuring a healthy and effective
organization. The Administrator then instructed the senior executives
to review the common critical elements and incorporate them into their
individual performance plans. When incorporating the elements into
their individual plans, the senior executives have the opportunity to
modify the performance requirements for each element to more clearly
reflect their roles and responsibilities.
According to NASA's guidance, the centers and offices are to provide
training and information on the performance management system to their
senior executives. In addition, an official at NASA said that most
centers and offices provide training to new senior executives on
aspects of the performance management system, such as developing
individual performance plans. Also, NASA provides training courses for
all employees on specific aspects of performance management, such as
writing performance appraisals and self-assessments.
Approximately half of Education's senior executives reported that they
did not have the opportunity to be involved in refining their agency's
system, while about one-fourth of the senior executives reported that
formal training on their agency's system was not available to them, as
shown in figure 17.
Figure 17: Percentage of Senior Executives at Education Reporting
Involvement and Training Opportunities by Extent:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
Percentages do not add up to 100 percent due to senior executives who
responded "no basis to judge/not applicable."
[End of figure]
An official at Education indicated that senior executives have the
opportunity to comment on changes proposed to the performance
management system by the Executive Resources Board. In addition,
according to Education's guidance, training for all senior executives
on the performance management system is to be provided periodically. An
agency official said that Education provided training for all managers,
including senior executives, on how to conduct performance appraisals
and write performance expectations near the end of the performance
appraisal cycle last year.
Maintain Continuity during Transitions:
The experience of successful cultural transformations in large public
and private organizations suggests that it can often take 5 to 7 years
until such initiatives are fully implemented and cultures are
transformed in a substantial manner. We reported that among the key
practices consistently found at the center of successful
transformations is to use the performance management system to define
responsibility and assure accountability for change.[Footnote 27] The
average tenure of political leadership can have critical implications
for the success of those initiatives. Specifically, in the federal
government the frequent turnover of the political leadership has often
made it difficult to obtain the sustained and inspired attention
required to make needed changes. We reported that the average tenure of
political appointees governmentwide for the period 1990-2001 was just
under 3 years.[Footnote 28]
Performance management systems help provide continuity during these
times of transition by maintaining a consistent focus on a set of broad
programmatic priorities. Individual performance plans can be used to
clearly and concisely outline top leadership priorities during a given
year and thereby serve as a convenient vehicle for new leadership to
identify and maintain focus on the most pressing issues confronting the
organization as it transforms. We have observed that a specific
performance expectation in senior executives' performance plans to lead
and facilitate change during transitions could be critical as
organizations transform themselves to succeed in an environment that is
more results oriented, less hierarchical, and more integrated.[Footnote
29]
While many senior executives at each agency reported that their
agency's senior executive performance management system helped to
maintain a consistent focus on organizational goals during transitions,
the majority of senior executives felt this occurred to a moderate
extent or less, as shown in figure 18.
Figure 18: Percentage of Senior Executives Who Felt Their Agency's SES
Performance Management System Helped to Maintain a Consistent Focus on
Organizational Goals during Transitions by Extent:
[See PDF for image]
Notes: Based on GAO survey of career senior executives.
Percentages do not add up to 100 percent due to senior executives who
responded "no basis to judge/not applicable." Senior executives in NASA
and HHS who have served for less than 1 year were more likely to
respond "no basis to judge/not applicable." This was not an issue for
Education since fewer senior executives have served less than 1 year.
[End of figure]
According to an agency official, HHS as a whole struggles with
transitions between secretaries as with each change in leadership comes
a change in initiatives. Approximately 25 percent of HHS senior
executives' plans identified performance expectations related to
leading and facilitating change in the organization. For example,
several senior executives' plans identified actions the executives were
going to take in terms of succession planning and leadership
development for their organizations. Specifically, a senior executive
in the National Institutes of Health set the expectation to develop a
workforce plan that supports the future needs of the office, including
addressing such things as succession and transition planning. About 33
percent of senior executives' plans in FDA and 15 percent in CDC
identified performance expectations related to leading and facilitating
change. To help address this issue of continuity in leadership and
transitions, HHS identified as part of its One-HHS objectives a goal to
"implement strategic workforce plans that improve recruitment,
retention, hiring and leadership succession results for mission
critical positions."
Education requires all senior executives to include a general
performance expectation in their performance plans related to change:
"initiates new and better ways of doing things; creates real and
positive change." Approximately 98 percent of the senior executives'
plans included this expectation.
Almost none of the NASA senior executives' performance plans identified
an expectation related to leading and facilitating change during
transitions. An agency official indicated that while NASA did not set a
specific expectation for senior executives to include in their
individual performance plans, leading and facilitating change is
addressed through several of the critical elements. For example, for
the "Health of NASA" critical element, senior executives are to
demonstrate actions that contribute to safe and successful mission
accomplishment and facilitate knowledge sharing within and between
programs and projects. We have reported that NASA recognizes the
importance of change management through its response to the Columbia
Accident Investigation Board's findings.[Footnote 30] NASA indicated
that it would increase its focus on the human element of change
management and organizational development, among other things, to
improve the agency's culture.
Conclusions:
Senior executives need to lead the way for federal agencies to
transform their cultures to be more results oriented, customer focused,
and collaborative in nature to meet the challenges of the 21st century.
Performance management systems can help manage and direct this
transformation process. Education, HHS, and NASA have undertaken
important and valuable efforts, but these agencies need to continue to
make substantial progress in using their senior executive performance
management systems to strengthen the linkage between senior executive
performance and organizational success through the key practices for
effective performance management.
Consistent with our findings and OPM's reviews across the executive
branch, these agencies must use their career senior executive
performance management systems as strategic tools. In addition, as the
administration is about to implement a performance-based pay system for
the SES, valid, reliable, and transparent performance management
systems with reasonable safeguards are critical. The experiences and
progress of Education, HHS, and NASA should prove helpful to those
agencies as well as provide valuable information to other agencies as
they seek to use senior executive performance management as a tool to
drive internal change and achieve external results.
Recommendations for Executive Action:
Overall, we recommend that the Secretaries of Education and HHS and the
Administrator of NASA continue to build their career senior executive
performance management systems along the nine key practices for
effective performance management. Specifically, we recommend the
following.
The Secretary of Education should reinforce these key practices by
taking the following seven actions:
* Require senior executives to set specific levels of performance that
are linked to organizational goals to help them see how they directly
contribute to organizational goals.
* Require senior executives to identify in their individual performance
plans programmatic crosscutting goals that would require collaboration
to achieve and clearly identify the relevant internal or external
organizations with which they would collaborate to achieve these goals.
* Provide disaggregated performance information from various sources to
help facilitate senior executive decision making and progress in
achieving organizational results, customer satisfaction, and employee
perspectives.
* Require senior executives to take follow-up actions based on the
performance information available to them in order to make programmatic
improvements, and formally recognize executives for these actions.
* Build in additional safeguards when linking pay to performance by
communicating the overall results of the performance management
decisions.
* Make meaningful distinctions in senior executive performance through
both ratings and bonuses.
* Involve senior executives in future refinements to the performance
management system and offer training on the system, as appropriate.
The Secretary of HHS should reinforce these key practices by taking the
following seven actions:
* Require senior executives to clearly identify in their individual
performance plans the relevant internal or external organizations with
which they would collaborate to achieve programmatic crosscutting
goals.
* Provide disaggregated performance information from various sources to
help facilitate senior executive decision making and progress in
achieving organizational results, customer satisfaction, and employee
perspectives.
* Require senior executives to take follow-up actions based on the
performance information available to them in order to make programmatic
improvements, and formally recognize executives for these actions.
* Build in additional safeguards when linking pay to performance by
communicating the overall results of the performance management
decisions.
* Make meaningful distinctions in senior executive performance through
ratings.
* Involve senior executives in future refinements to the performance
management system and offer training on the system, as appropriate.
* Set specific performance expectations for senior executives related
to leading and facilitating change management initiatives during
ongoing transitions throughout the organization that executives should
include in their individual performance plans.
The Administrator of NASA should reinforce these key practices by
taking the following eight actions:
* Require senior executives to set specific levels of performance that
are linked to organizational goals to help them see how they directly
contribute to organizational goals.
* Require senior executives to identify in their individual performance
plans programmatic crosscutting goals that would require collaboration
to achieve and clearly identify the relevant internal or external
organizations with which they would collaborate to achieve these goals.
* Provide disaggregated performance information from various sources to
help facilitate senior executive decision making and progress in
achieving organizational results, customer satisfaction, and employee
perspectives.
* Require senior executives to take follow-up actions based on the
performance information available to them in order to make programmatic
improvements, and formally recognize executives for these actions.
* Build in additional safeguards when linking pay to performance by
communicating the overall results of the performance management
decisions.
* Make meaningful distinctions in senior executive performance through
both ratings and bonuses.
* Involve senior executives in future refinements to the performance
management system and offer training on the system, as appropriate.
* Set specific performance expectations for senior executives related
to leading and facilitating change management initiatives during
ongoing transitions throughout the organization that executives should
include in their individual performance plans.
Agency Comments and Our Evaluation:
We provided a draft of this report to the Secretaries of Education and
HHS and the Administrator of NASA for their review and comment. We also
provided a draft of the report to the Directors of OPM and OMB for
their information. We received written comments from Education, HHS,
and NASA, which are presented in appendixes IV, V, and VI. NASA's
Deputy Administrator stated that the draft report is generally positive
and that NASA concurred with all the recommendations and plans to
implement them in its next SES appraisal cycle beginning July 1, 2004.
HHS's Acting Principal Deputy Inspector General stated that HHS had no
comments upon review of the draft report.
In responding to our recommendations, Education's Assistant Secretary
for Management and Chief Information Officer stated that Education
plans to revise its existing senior executive performance management
system dramatically given OPM's draft regulations for the new SES pay
for performance system and described specific actions Education plans
to take. These actions are generally consistent with our
recommendations and their successful completion will be important to
achieving the intent of our recommendations.
However, Education stated that it does not plan to require the specific
identification of the internal/external organizations with which the
executives collaborate, as we recommended. We disagree that Education
does not need to implement this recommendation. Education is taking
important steps by requiring senior executives to include a general
performance expectation related to collaboration and teamwork in their
individual performance plans, but placing greater emphasis on this
expectation is especially important for Education. We reported that
Education will have to help states and school districts meet the goals
of congressional actions such as the No Child Left Behind Act.[Footnote
31] Consequently, Education should require senior executives to
identify the crosscutting goals and relevant organizations with which
they would collaborate to achieve them in order to help reinforce the
necessary focus on results.
Lastly, Education stated that it has fully implemented our
recommendation for providing senior executives disaggregated
performance information from various sources to help facilitate
decision making and progress in achieving organizational priorities. We
disagree that Education has fully implemented this recommendation.
While we recognize Education's two sources of agencywide performance
information for its senior executives, we also reported that only about
one-third of the senior executives who reported that the agency
provided performance information felt that the performance information
was useful for making improvements and available when needed to a very
great or great extent. Consequently, Education should provide all of
its senior executives performance information from various sources that
is disaggregated in a useful format to help them track their progress
toward achieving organizational results and other priorities, such as
customer satisfaction and employee perspectives.
As agreed with your offices, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days
after its date. At that time, we will provide copies of this report to
other interested congressional parties, the Secretaries of Education
and HHS, the Administrator of NASA, and the Directors of OPM and OMB.
We will also make this report available at no charge on the GAO Web
site at [Hyperlink, http://www.gao.gov].
If you have any questions about this report, please contact me or Lisa
Shames on (202) 512-6806 or at [Hyperlink, mihmj@gao.gov] or
[Hyperlink, shamesl@gao.gov]. Other contributors are acknowledged in
appendix VII.
Signed by:
J. Christopher Mihm:
Managing Director, Strategic Issues:
[End of section]
Appendixes:
Appendix I: Objective, Scope, and Methodology:
To meet our objective to assess how well selected agencies are creating
linkages between senior executive performance and organizational
success through their performance management systems, we applied the
key practices we previously identified for effective performance
management.[Footnote 32] We focused on agencies' career Senior
Executive Service (SES) members, rather than all senior-level
officials, because the Office of Personnel Management (OPM) collects
data on senior executives across the government. In addition, career
senior executives are common to all three of the selected agencies and
typically manage programs and supervise staff.
We selected the Department of Education, the Department of Health and
Human Services (HHS), and the National Aeronautics and Space
Administration (NASA) for our review to reflect variations in mission,
size, organizational structure, and use of their performance management
systems for career senior executives. Within HHS, we selected two of
the operating divisions--the Food and Drug Administration (FDA) and the
Centers for Disease Control and Prevention (CDC)--to determine how
HHS's SES performance management system cascades down to the operating
division level. We selected these two operating divisions after
reviewing HHS's strategic plan and its operating divisions' annual
performance plans to identify two agencies that contributed to the same
HHS strategic goal(s) through their annual performance goals. We then
reviewed the SES population data from OPM's Central Personal Data File
to verify that the two operating divisions each had a relatively large
number of senior executives.
To assess the agencies' senior executive performance management
systems, we did the following:
Analyzed Agency Documents and Bonus and Rating Data, and Interviewed
Cognizant Agency Officials:
We collected and analyzed each agency's senior executive performance
management system policy manual; personnel policies and memorandums;
strategic plan and annual performance plan; employee and customer
satisfaction survey instruments and analyses, as appropriate; and
aggregate trend data for senior executive performance ratings and bonus
distributions. In addition, we reviewed OPM's draft proposed
regulations prescribing the criteria agencies must meet to obtain
certification of their systems, which OPM provided for review and
comment to the heads of departments and agencies, including GAO, on
April 28, 2004.
We also assessed the reliability of the senior executive performance
rating and bonus data provided by Education, HHS, NASA, and OPM to
ensure that the data we used for this report were complete and accurate
by (1) performing manual and electronic testing of required data
elements; (2) comparing the data to published OPM data, when
applicable; and (3) interviewing agency officials knowledgeable about
the data. We determined that the data provided by the agencies and OPM
were sufficiently reliable for the purposes of this report.
We also interviewed the chief human capital officers at Education and
HHS as well as officials at all three agencies responsible for managing
human capital; implementing the strategic and annual performance plans;
and administering agencywide employee and customer satisfaction
surveys, as appropriate, and other agency officials identified as
having a particular knowledge about issues related to senior executive
performance management. In addition, we met with the President of the
Senior Executives Association to obtain her thoughts on the new SES
performance-based pay structure and performance management in general.
Assessed a Sample of Career SES Individual Performance Plans:
We assessed a probability sample of SES individual performance plans at
HHS and NASA and all the SES plans at Education using a data collection
instrument we prepared in order to identify how senior executives were
addressing certain practices--aligning individual performance
expectations with organizational goals, connecting performance
expectations to crosscutting goals, using competencies, and maintaining
continuity during transitions--through their individual performance
plans.
To randomly select the plans, we collected a list of all current career
senior executives as of August/September 2003 from each agency. Since
HHS's operating divisions develop their own SES performance plans and
implement their performance management systems, we drew the sample such
that it would include each operating division and be representative of
all of HHS. In addition to the stratified sample for HHS overall, we
reviewed all senior executives plans at FDA and CDC to ensure that
estimates could be produced for these operating divisions. For all
three agencies, we reviewed the individual performance plans most
recently collected by the human resources offices. We reviewed plans
from the performance appraisal cycle for HHS covering fiscal year 2003,
for Education covering July 2002-June 2003, and for NASA covering July
2003-June 2004.
Sample Design:
We selected and reviewed all senior executives' individual performance
plans from Education, a simple random sample from NASA, and a
stratified sample from HHS. The sample of SES performance plans allowed
us to estimate characteristics of these plans for each of these three
agencies. For each agency, the SES population size, number of SES plans
in sample, and number of plans reviewed are shown in table 5.
Table 5: Disposition of SES Performance Plan Review, by Agency:
Agency: HHS;
SES population: 334;
Number of plans in sample: 125;
Number of out of scope plans: 7;
Number of plans reviewed: 118.
Agency: - CDC (stratum 1);
SES population: 20;
Number of plans in sample: 20;
Number of out of scope plans: 0;
Number of plans reviewed: 20.
Agency: - FDA (stratum 2);
SES population: 40;
Number of plans in sample: 40;
Number of out of scope plans: 0;
Number of plans reviewed: 40.
Agency: - Rest of HHS (stratum 3);
SES population: 274;
Number of plans in sample: 65;
Number of out of scope plans: 7;
Number of plans reviewed: 58.
Agency: Education;
SES population: 59;
Number of plans in sample: 59;
Number of out of scope plans: 0;
Number of plans reviewed: 59.
Agency: NASA[A];
SES population: 397;
Number of plans in sample: 86;
Number of out of scope plans: 0;
Number of plans reviewed: 81.
Source: GAO.
[A] For NASA, 5 of the 86 SES performance plans were not provided by
the agency; hence NASA's response rate is 94 percent.
[End of table]
We excluded out of scope cases from our population and sample, which
included senior executives who had retired or resigned, were not career
senior executives, or did not have individual performance plans because
they were either new executives or on detail to another agency. For
HHS, excluding CDC and FDA, we do not know the number of out of scope
SES plans in the entire senior executive population; however, there
were seven out of scope SES plans in our sample of performance plans.
For this review, we only estimate to the population of in scope SES
plans.
Estimation and Sampling Error:
All population estimates based on this plan review are for the target
population defined as SES performance plans for the most recent year
available from each of the three agencies. For Education, we report
actual numbers for our review of individual performance plans since we
reviewed all the plans. For HHS and NASA, we produced estimates to the
population of all SES performance plans in those agencies for the
relevant year. Estimates are produced using appropriate methods for
simple random sampling for NASA and for stratified random sampling for
HHS. For NASA and for each stratum for HHS, we formed estimates by
weighting the data by the ratio of the population size to the number of
plans reviewed. For NASA, we considered the 81 plans obtained and
reviewed to be a probability sample.
The HHS and NASA performance plan samples are subject to sampling
error. There was no sampling error for the census review of senior
executives' performance plans for FDA, CDC, and Education. The effects
of sampling errors, due to the selection of a sample from a larger
population, can be expressed as confidence intervals based on
statistical theory. Sampling errors occur because we use a sample to
draw conclusions about a larger population. As a result, the sample was
only one of a large number of samples of performance plans that might
have been drawn. If different samples had been taken, the results might
have been different. To recognize the possibility that other samples
might have yielded other results, we express our confidence in the
precision of our particular sample's results as a 95 percent confidence
interval.
The 95 percent confidence intervals are expected to include the actual
results for 95 percent of samples of this type. We calculated
confidence intervals for this sample using methods that are appropriate
for the sample design used. For HHS estimates in this report, we are 95
percent confident that when sampling error is considered, the results
we obtained are within +9 percentage points of what we would have
obtained if we had reviewed the plans of the entire study population,
unless otherwise noted. For NASA, the 95 percent confidence intervals
for percentage estimates are no wider than +6 percentage points, unless
otherwise noted.
Surveyed All Career SES at Each Agency:
We administered a Web-based questionnaire to the study population of
all career senior executives at Education, HHS, and NASA to obtain
information on their experiences with and perceptions of their
performance management systems. We collected a list of all career
senior executives and e-mail addresses from each agency as of August/
September 2003 to identify the respondents for our survey. We
structured the questionnaire around the key practices we identified for
effective performance management and included some questions about
senior executives' overall perceptions of their performance management
systems. The questions were nearly identical across the agencies,
though some introductory language and terminology varied. The complete
questionnaire and results are shown in appendix II.
Although all senior executives were sampled, in the implementation of
the survey, we found that some executives were out of scope because
they retired or resigned, were not career senior executives, or
otherwise did not respond. Table 6 contains a summary of the survey
disposition for the surveyed cases at the three agencies.
Table 6: Disposition of SES Survey, by Agency:
Number of SES: SES population;
Education: 59;
HHS: 329;
NASA: 397.
Number of SES: SES out of scope;
Education: 2;
HHS: 12;
NASA: 4.
Number of SES: SES in scope;
Education: 57;
HHS: 317;
NASA: 393.
Number of SES: Survey respondents;
Education: 41;
HHS: 214;
NASA: 260.
Number of SES: In scope respondents;
Education: 41;
HHS: 213;
NASA: 260.
Number of SES: Out of scope respondents;
Education: 0;
HHS: 1;
NASA: 0.
Response rate;
Education: 72%;
HHS: 67%;
NASA: 66%.
Source: GAO.
[End of table]
Table 7 summarizes why individuals originally included in the target
population by each agency were removed from the sample.
Table 7: Number of SES Out of Scope and Reason, by Agency:
Reason out of scope: Noncareer SES (e.g., political appointee or
limited term);
Education: 0;
HHS: 1;
NASA: 0.
Reason out of scope: No longer SES;
Education: 0;
HHS: 2;
NASA: 0.
Reason out of scope: Retired or resigned;
Education: 2;
HHS: 8;
NASA: 3.
Reason out of scope: Not an SES member (e.g., General Schedule
position);
Education: 0;
HHS: 1;
NASA: 0.
Reason out of scope: On sick leave;
Education: 0;
HHS: 0;
NASA: 1.
Total out of scope;
Education: 2;
HHS: 12;
NASA: 4.
Source: GAO.
[End of table]
For Education, we surveyed a total of 57 career senior executives and
received completed questionnaires from 41 senior executives for a
response rate of 72 percent. For HHS, we surveyed a total of 317 career
senior executives and received completed questionnaires from 213 senior
executives for a response rate of 67 percent. For NASA, we surveyed a
total of 393 career senior executives and received completed
questionnaires from 260 senior executives for a response rate of 66
percent.
Estimation and Sampling Error:
We obtained responses from across Education and from all subentities
within HHS and NASA and had no reason to expect that the views of
nonrespondents might be different from the respondents. Consequently,
our analysis of the survey data treats the respondents as a simple
random sample of the populations of senior executives at each of the
three agencies.
We also reviewed whether senior executives who have served less than 1
year at an agency tended to respond differently than those with more
than 1 year of experience. We did find some differences on certain
questions for which individuals who served as senior executives for
less than 1 year were more likely to answer "no basis to judge/not
applicable" and noted these differences in the report. The estimated
percentage of the senior executives responding "no basis to judge/not
applicable" to questions ranged from 0 to 24 percent. Since this range
is relatively wide, we have reported "no basis to judge/not applicable"
as a separate response category for each question in appendix II.
The particular sample of senior executives (those who responded to the
survey) we obtained from each agency was only one of a large number of
such samples of senior executives that we might have obtained. Each of
these different samples might have produced slightly different results.
To recognize the possibility that other samples might have yielded
other results, we express our confidence in the precision of our
particular sample's results as a 95 percent confidence interval. For
Education, unless otherwise noted, the survey responses have a margin
of error within ± 9 percent with a 95 percent level of confidence. For
HHS and NASA, unless otherwise noted, the survey responses have a
margin of error within ± 4 percent with a 95 percent level of
confidence.
Nonsampling Error:
In addition to sampling error, other potential sources of errors
associated with surveys, such as question misinterpretation, may be
present. Nonresponse may also be a source of nonsampling error. We took
several steps to reduce these other sources of error.
We conducted pretests of the questionnaire both with appropriate senior
executives in GAO and senior executives in the three agencies surveyed
to ensure that the questionnaire (1) was clear and unambiguous, (2) did
not place undue burden on individuals completing it, and (3) was
independent and unbiased. We pretested a paper copy of the survey with
three senior executives in GAO who did not work in the human capital
area. We then had a human resources professional with each agency
review the survey for agency-specific content and language. We
conducted six pretests overall with senior executives in the audited
agencies--one at Education, three at HHS, and two at NASA. The first
four were conducted using a paper version of the questionnaire and the
final two were conducted using the Web version.
To increase the response rate for each agency, we sent a reminder e-
mail about the survey to those senior executives who did not complete
the survey in the initial time frame and conducted follow-up telephone
calls to persons who had not completed the survey following the
reminder e-mail. The HHS and NASA surveys were available from October
22, 2003, through January 16, 2004, and the Education survey was
available from November 3, 2003, through January 16, 2004.
We performed our work in Washington, D.C., from August 2003 through
March 2004 in accordance with generally accepted government auditing
standards.
[End of section]
Appendix II: GAO Senior Executive Survey Data from Education, HHS, and
NASA:
We administered a Web-based questionnaire to the study population of
all career senior executives at Education, HHS, and NASA to obtain
information on their experiences with and perceptions of their
performance management systems.[Footnote 33] We structured the
questionnaire around key practices we identified for effective
performance management.[Footnote 34] The response rates and margins of
error for each agency are as follows.
* For Education, we surveyed a total of 57 career senior executives and
received completed questionnaires from 41 senior executives for a
response rate of 72 percent. Unless otherwise noted, the survey
responses have a margin of error within ± 9 percent with a 95 percent
level of confidence.
* For HHS, we surveyed a total of 317 career senior executives and
received completed questionnaires from 213 senior executives for a
response rate of 67 percent. Unless otherwise noted, the survey
responses have a margin of error within ± 4 percent with a 95 percent
level of confidence.
* For NASA, we surveyed a total of 393 career senior executives and
received completed questionnaires from 260 senior executives for a
response rate of 66 percent. Unless otherwise noted, the survey
responses have a margin of error within ± 4 percent with a 95 percent
level of confidence.
The information below shows the senior executives' responses for each
question by agency.[Footnote 35]
1. Align individual performance expectations with organizational goals.
You see a connection between your daily activities and the achievement
of organizational goals.
EDUCATION;
To a very great extent (percent): 45%;
To a great extent (percent): 43%;
To a moderate extent (percent): 8%;
To a small extent (percent): 5%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 0%.
HHS;
To a very great extent (percent): 52%;
To a great extent (percent): 28%;
To a moderate extent (percent): 15%;
To a small extent (percent): 4%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 1%.
NASA;
To a very great extent (percent): 64%;
To a great extent (percent): 27%;
To a moderate extent (percent): 8%;
To a small extent (percent): 2%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 0%.
[End of table]
You communicate your performance expectations to the individuals who
report to you to help them understand how they can contribute to
organizational goals.
EDUCATION;
To a very great extent (percent): 30%;
To a great extent (percent): 50%;
To a moderate extent (percent): 10%;
To a small extent (percent): 0%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 10%.
HHS;
To a very great extent (percent): 36%;
To a great extent (percent): 32%;
To a moderate extent (percent): 20%;
To a small extent (percent): 10%;
To no extent (percent): 1%;
No basis to judge/Not applicable (percent): 1%.
NASA;
To a very great extent (percent): 48%;
To a great extent (percent): 42%;
To a moderate extent (percent): 8%;
To a small extent (percent): 1%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 2%.
[End of table]
You see a connection between your daily activities and HHS's
priorities.
HHS;
To a very great extent (percent): 48%;
To a great extent (percent): 35%;
To a moderate extent (percent): 11%;
To a small extent (percent): 2%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 4%.
[End of table]
2. Connect performance expectations to crosscutting goals%.
You collaborate with others to achieve crosscutting goals.
EDUCATION;
To a very great extent (percent): 37%;
To a great extent (percent): 39%;
To a moderate extent (percent): 22%;
To a small extent (percent): 0%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 2%.
HHS;
To a very great extent (percent): 52%;
To a great extent (percent): 35%;
To a moderate extent (percent): 9%;
To a small extent (percent): 3%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 1%.
NASA;
To a very great extent (percent): 53%;
To a great extent (percent): 38%;
To a moderate extent (percent): 9%;
To a small extent (percent): 1%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 0%.
[End of table]
You identify strategies for collaborating with others to achieve
crosscutting goals.
EDUCATION;
To a very great extent (percent): 24%;
To a great extent (percent): 49%;
To a moderate extent (percent): 24%;
To a small extent (percent): 0%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 2%.
HHS;
To a very great extent (percent): 42%;
To a great extent (percent): 43%;
To a moderate extent (percent): 10%;
To a small extent (percent): 3%;
To no extent (percent): 1%;
No basis to judge/Not applicable (percent): 1%.
NASA;
To a very great extent (percent): 42%;
To a great extent (percent): 44%;
To a moderate extent (percent): 12%;
To a small extent (percent): 1%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 0%.
[End of table]
You are recognized through your performance management system for
contributing to crosscutting goals.
EDUCATION;
To a very great extent (percent): 32%;
To a great extent (percent): 20%;
To a moderate extent (percent): 17%;
To a small extent (percent): 20%;
To no extent (percent): 7%;
No basis to judge/Not applicable (percent): 5%.
HHS;
To a very great extent (percent): 30%;
To a great extent (percent): 27%;
To a moderate extent (percent): 19%;
To a small extent (percent): 11%;
To no extent (percent): 6%;
No basis to judge/Not applicable (percent): 7%.
NASA;
To a very great extent (percent): 35%;
To a great extent (percent): 32%;
To a moderate extent (percent): 20%;
To a small extent (percent): 7%;
To no extent (percent): 5%;
No basis to judge/Not applicable (percent): 1%.
[End of table]
Education's survey questions:
Do you collaborate with other offices within Education to achieve
crosscutting goals?
Yes (percent): 93%;
No (percent): 2%;
Does not apply given my current position. (percent): 5%.
[End of table]
Do you collaborate with other agencies or organizations outside of
Education to achieve crosscutting goals?
Yes (percent): 83%;
No (percent): 12%;
Does not apply given my current position. (percent): 5%.
[End of table]
HHS's survey questions:
Do you collaborate with other operating divisions within HHS to
achieve crosscutting goals?
Yes (percent): 87%;
No (percent): 5%;
Does not apply given my current position. (percent): 8%.
[End of table]
Do you collaborate with other agencies or organizations outside of HHS
to achieve crosscutting goals?
Yes (percent): 83%;
No (percent): 7%;
Does not apply given my current position. (percent): 10%.
[End of table]
NASA's survey questions:
Do you collaborate with other centers within NASA to achieve
crosscutting goals?
Yes (percent): 97%;
No (percent): 2%;
Does not apply given my current position. (percent): 1%.
[End of table]
Do you collaborate with other agencies or organizations outside of
NASA to achieve crosscutting goals?
Yes (percent): 87%;
No (percent): 8%;
Does not apply given my current position. (percent): 5%.
[End of table]
3. Provide and routinely use performance information to track
organizational priorities.
Your agency formally provides performance information that allows you
to track your work unit's performance.
EDUCATION;
To a very great extent (percent): 15%;
To a great extent (percent): 25%;
To a moderate extent (percent): 30%;
To a small extent (percent): 18%;
To no extent (percent): 5%;
No basis to judge/Not applicable (percent): 8%.
HHS;
To a very great extent (percent): 18%;
To a great extent (percent): 24%;
To a moderate extent (percent): 28%;
To a small extent (percent): 14%;
To no extent (percent): 11%;
No basis to judge/Not applicable (percent): 5%.
NASA;
To a very great extent (percent): 25%;
To a great extent (percent): 31%;
To a moderate extent (percent): 27%;
To a small extent (percent): 11%;
To no extent (percent): 4%;
No basis to judge/Not applicable (percent): 3%.
[End of table]
Your agency formally provides performance information that allows you
to compare the performance of your work unit to that of other work
units.
EDUCATION;
To a very great extent (percent): 5%;
To a great extent (percent): 13%;
To a moderate extent (percent): 18%;
To a small extent (percent): 35%;
To no extent (percent): 18%;
No basis to judge/Not applicable (percent): 13%.
HHS;
To a very great extent (percent): 9%;
To a great extent (percent): 13%;
To a moderate extent (percent): 16%;
To a small extent (percent): 29%;
To no extent (percent): 23%;
No basis to judge/Not applicable (percent): 10%.
NASA;
To a very great extent (percent): 6%;
To a great extent (percent): 23%;
To a moderate extent (percent): 31%;
To a small extent (percent): 20%;
To no extent (percent): 13%;
No basis to judge/Not applicable (percent): 7%.
[End of table]
Your agency formally provides performance information that allows you
to compare the performance of your work unit to that of your agency.
EDUCATION;
To a very great extent (percent): 8%;
To a great extent (percent): 13%;
To a moderate extent (percent): 20%;
To a small extent (percent): 23%;
To no extent (percent): 25%;
No basis to judge/Not applicable (percent): 13%.
HHS;
To a very great extent (percent): 9%;
To a great extent (percent): 16%;
To a moderate extent (percent): 21%;
To a small extent (percent): 22%;
To no extent (percent): 20%;
No basis to judge/Not applicable (percent): 12%.
NASA;
To a very great extent (percent): 6%;
To a great extent (percent): 20%;
To a moderate extent (percent): 29%;
To a small extent (percent): 22%;
To no extent (percent): 16%;
No basis to judge/Not applicable (percent): 8%.
[End of table]
Your agency formally provides performance information that is
available to you when you need it.
EDUCATION;
To a very great extent (percent): 10%;
To a great extent (percent): 23%;
To a moderate extent (percent): 15%;
To a small extent (percent): 30%;
To no extent (percent): 13%;
No basis to judge/Not applicable (percent): 10%.
HHS;
To a very great extent (percent): 13%;
To a great extent (percent): 23%;
To a moderate extent (percent): 23%;
To a small extent (percent): 17%;
To no extent (percent): 16%;
No basis to judge/Not applicable (percent): 8%.
NASA;
To a very great extent (percent): 16%;
To a great extent (percent): 30%;
To a moderate extent (percent): 26%;
To a small extent (percent): 17%;
To no extent (percent): 8%;
No basis to judge/Not applicable (percent): 3%.
[End of table]
Your agency formally provides performance information that is useful
for making improvements in your work unit's performance.
EDUCATION;
To a very great extent (percent): 10%;
To a great extent (percent): 25%;
To a moderate extent (percent): 20%;
To a small extent (percent): 20%;
To no extent (percent): 18%;
No basis to judge/Not applicable (percent): 8%.
HHS;
To a very great extent (percent): 13%;
To a great extent (percent): 20%;
To a moderate extent (percent): 28%;
To a small extent (percent): 15%;
To no extent (percent): 18%;
No basis to judge/Not applicable (percent): 7%.
NASA;
To a very great extent (percent): 15%;
To a great extent (percent): 28%;
To a moderate extent (percent): 27%;
To a small extent (percent): 17%;
To no extent (percent): 9%;
No basis to judge/Not applicable (percent): 5%.
[End of table]
4. Require follow-up actions to address organizational priorities.
You identified areas for improvement based on performance information
formally provided by your agency.
EDUCATION;
To a very great extent (percent): 15%;
To a great extent (percent): 21%;
To a moderate extent (percent): 33%;
To a small extent (percent): 18%;
To no extent (percent): 5%;
No basis to judge/Not applicable (percent): 8%.
HHS;
To a very great extent (percent): 17%;
To a great extent (percent): 26%;
To a moderate extent (percent): 22%;
To a small extent (percent): 12%;
To no extent (percent): 11%;
No basis to judge/Not applicable (percent): 13%.
NASA;
To a very great extent (percent): 19%;
To a great extent (percent): 35%;
To a moderate extent (percent): 23%;
To a small extent (percent): 9%;
To no extent (percent): 8%;
No basis to judge/Not applicable (percent): 6%.
[End of table]
You took action on any identified areas of improvement.
EDUCATION;
To a very great extent (percent): 23%;
To a great extent (percent): 33%;
To a moderate extent (percent): 23%;
To a small extent (percent): 8%;
To no extent (percent): 5%;
No basis to judge/Not applicable (percent): 8%.
HHS;
To a very great extent (percent): 25%;
To a great extent (percent): 35%;
To a moderate extent (percent): 14%;
To a small extent (percent): 6%;
To no extent (percent): 7%;
No basis to judge/Not applicable (percent): 12%.
NASA;
To a very great extent (percent): 29%;
To a great extent (percent): 45%;
To a moderate extent (percent): 11%;
To a small extent (percent): 4%;
To no extent (percent): 4%;
No basis to judge/Not applicable (percent): 7%.
[End of table]
You documented areas for improvement in your individual performance
plan.
EDUCATION;
To a very great extent (percent): 21%;
To a great extent (percent): 18%;
To a moderate extent (percent): 26%;
To a small extent (percent): 8%;
To no extent (percent): 15%;
No basis to judge/Not applicable (percent): 13%.
HHS;
To a very great extent (percent): 18%;
To a great extent (percent): 25%;
To a moderate extent (percent): 23%;
To a small extent (percent): 9%;
To no extent (percent): 13%;
No basis to judge/Not applicable (percent): 13%.
NASA;
To a very great extent (percent): 15%;
To a great extent (percent): 32%;
To a moderate extent (percent): 24%;
To a small extent (percent): 11%;
To no extent (percent): 9%;
No basis to judge/Not applicable (percent): 9%.
[End of table]
You are recognized through your performance management system for
taking follow-up actions.
EDUCATION;
To a very great extent (percent): 15%;
To a great extent (percent): 18%;
To a moderate extent (percent): 26%;
To a small extent (percent): 13%;
To no extent (percent): 18%;
No basis to judge/Not applicable (percent): 10%.
HHS;
To a very great extent (percent): 16%;
To a great extent (percent): 23%;
To a moderate extent (percent): 23%;
To a small extent (percent): 10%;
To no extent (percent): 11%;
No basis to judge/Not applicable (percent): 18%.
NASA;
To a very great extent (percent): 15%;
To a great extent (percent): 36%;
To a moderate extent (percent): 23%;
To a small extent (percent): 10%;
To no extent (percent): 7%;
No basis to judge/Not applicable (percent): 10%.
[End of table]
5. Use competencies to provide a fuller assessment of performance.
The competencies you demonstrate help you contribute to the
organization's goals.
EDUCATION;
To a very great extent (percent): 49%;
To a great extent (percent): 36%;
To a moderate extent (percent): 10%;
To a small extent (percent): 3%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 3%.
HHS;
To a very great extent (percent): 68%;
To a great extent (percent): 26%;
To a moderate extent (percent): 4%;
To a small extent (percent): 1%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 1%.
NASA;
To a very great extent (percent): 62%;
To a great extent (percent): 30%;
To a moderate extent (percent): 6%;
To a small extent (percent): 1%;
To no extent (percent): 0%;
No basis to judge/Not applicable (percent): 0%.
[End of table]
You are recognized through your performance management system for your
demonstration of the competencies.
EDUCATION;
To a very great extent (percent): 28%;
To a great extent (percent): 26%;
To a moderate extent (percent): 18%;
To a small extent (percent): 18%;
To no extent (percent): 3%;
No basis to judge/Not applicable (percent): 8%.
HHS;
To a very great extent (percent): 31%;
To a great extent (percent): 31%;
To a moderate extent (percent): 20%;
To a small extent (percent): 9%;
To no extent (percent): 3%;
No basis to judge/Not applicable (percent): 6%.
NASA;
To a very great extent (percent): 36%;
To a great extent (percent): 36%;
To a moderate extent (percent): 16%;
To a small extent (percent): 7%;
To no extent (percent): 3%;
No basis to judge/Not applicable (percent): 2%.
[End of table]
6. Link pay to individual and organizational performance.
I am rewarded for accomplishing the performance expectations
identified in my individual performance plan.
EDUCATION;
Strongly agree (percent): 28%;
Agree (percent): 28%;
Neither agree or disagree (percent): 15%;
Disagree (percent): 13%;
Strongly disagree (percent): 8%;
No basis to judge/Not applicable (percent): 8%.
HHS;
Strongly agree (percent): 27%;
Agree (percent): 32%;
Neither agree or disagree (percent): 14%;
Disagree (percent): 12%;
Strongly disagree (percent): 10%;
No basis to judge/Not applicable (percent): 6%.
NASA;
Strongly agree (percent): 38%;
Agree (percent): 30%;
Neither agree or disagree (percent): 12%;
Disagree (percent): 8%;
Strongly disagree (percent): 7%;
No basis to judge/Not applicable (percent): 5%.
[End of table]
I am rewarded for helping my agency accomplish its goals.
EDUCATION;
Strongly agree (percent): 23%;
Agree (percent): 31%;
Neither agree or disagree (percent): 21%;
Disagree (percent): 13%;
Strongly disagree (percent): 8%;
No basis to judge/Not applicable (percent): 5%.
HHS;
Strongly agree (percent): 28%;
Agree (percent): 32%;
Neither agree or disagree (percent): 13%;
Disagree (percent): 13%;
Strongly disagree (percent): 8%;
No basis to judge/Not applicable (percent): 7%.
NASA;
Strongly agree (percent): 40%;
Agree (percent): 31%;
Neither agree or disagree (percent): 11%;
Disagree (percent): 7%;
Strongly disagree (percent): 6%;
No basis to judge/Not applicable (percent): 5%.
[End of table]
You understand the criteria used to award bonuses (e.g., cash awards).
EDUCATION;
To a very great extent (percent): 18%;
To a great extent (percent): 26%;
To a moderate extent (percent): 21%;
To a small extent (percent): 15%;
To no extent (percent): 21%;
No basis to judge/Not applicable (percent): 0%.
HHS;
To a very great extent (percent): 19%;
To a great extent (percent): 28%;
To a moderate extent (percent): 21%;
To a small extent (percent): 17%;
To no extent (percent): 13%;
No basis to judge/Not applicable (percent): 2%.
NASA;
To a very great extent (percent): 15%;
To a great extent (percent): 29%;
To a moderate extent (percent): 20%;
To a small extent (percent): 23%;
To no extent (percent): 12%;
No basis to judge/Not applicable (percent): 2%.
[End of table]
You understand the criteria used to award pay level adjustments (e.g.,
an increase from SES level 1 to level 2).
EDUCATION;
To a very great extent (percent): 18%;
To a great extent (percent): 24%;
To a moderate extent (percent): 11%;
To a small extent (percent): 16%;
To no extent (percent): 29%;
No basis to judge/Not applicable (percent): 3%.
HHS;
To a very great extent (percent): 17%;
To a great extent (percent): 22%;
To a moderate extent (percent): 23%;
To a small extent (percent): 16%;
To no extent (percent): 19%;
No basis to judge/Not applicable (percent): 3%.
NASA;
To a very great extent (percent): 14%;
To a great extent (percent): 23%;
To a moderate extent (percent): 27%;
To a small extent (percent): 19%;
To no extent (percent): 15%;
No basis to judge/Not applicable (percent): 2%.
[End of table]
Pay level adjustments are dependent on an individual's contribution to
the organization's goals.
EDUCATION;
To a very great extent (percent): 8%;
To a great extent (percent): 18%;
To a moderate extent (percent): 21%;
To a small extent (percent): 13%;
To no extent (percent): 15%;
No basis to judge/Not applicable (percent): 26%.
HHS;
To a very great extent (percent): 15%;
To a great extent (percent): 25%;
To a moderate extent (percent): 26%;
To a small extent (percent): 13%;
To no extent (percent): 8%;
No basis to judge/Not applicable (percent): 14%.
NASA;
To a very great extent (percent): 16%;
To a great extent (percent): 34%;
To a moderate extent (percent): 18%;
To a small extent (percent): 15%;
To no extent (percent): 6%;
No basis to judge/Not applicable (percent): 11%.
[End of table]
Bonuses are dependent on an individual's contribution to the
organization's goals.
EDUCATION;
To a very great extent (percent): 5%;
To a great extent (percent): 26%;
To a moderate extent (percent): 15%;
To a small extent (percent): 21%;
To no extent (percent): 13%;
No basis to judge/Not applicable (percent): 21%.
HHS;
To a very great extent (percent): 18%;
To a great extent (percent): 31%;
To a moderate extent (percent): 18%;
To a small extent (percent): 13%;
To no extent (percent): 6%;
No basis to judge/Not applicable (percent): 14%.
NASA;
To a very great extent (percent): 26%;
To a great extent (percent): 28%;
To a moderate extent (percent): 20%;
To a small extent (percent): 13%;
To no extent (percent): 4%;
No basis to judge/Not applicable (percent): 9%.
[End of table]
7. Make meaningful distinctions in performance.
Your agency's SES performance management system uses performance
ratings to make meaningful distinctions between acceptable and
outstanding performers.
EDUCATION;
To a very great extent (percent): 0%;
To a great extent (percent): 10%;
To a moderate extent (percent): 26%;
To a small extent (percent): 31%;
To no extent (percent): 18%;
No basis to judge/Not applicable (percent): 15%.
HHS;
To a very great extent (percent): 6%;
To a great extent (percent): 25%;
To a moderate extent (percent): 25%;
To a small extent (percent): 10%;
To no extent (percent): 15%;
No basis to judge/Not applicable (percent): 19%.
NASA;
To a very great extent (percent): 14%;
To a great extent (percent): 32%;
To a moderate extent (percent): 30%;
To a small extent (percent): 11%;
To no extent (percent): 3%;
No basis to judge/Not applicable (percent): 10%.
[End of table]
Your agency's SES performance management system uses bonuses to make
meaningful distinctions between acceptable and outstanding performers.
EDUCATION;
To a very great extent (percent): 10%;
To a great extent (percent): 23%;
To a moderate extent (percent): 10%;
To a small extent (percent): 21%;
To no extent (percent): 15%;
No basis to judge/Not applicable (percent): 21%.
HHS;
To a very great extent (percent): 11%;
To a great extent (percent): 27%;
To a moderate extent (percent): 22%;
To a small extent (percent): 11%;
To no extent (percent): 7%;
No basis to judge/Not applicable (percent): 23%.
NASA;
To a very great extent (percent): 19%;
To a great extent (percent): 29%;
To a moderate extent (percent): 20%;
To a small extent (percent): 14%;
To no extent (percent): 4%;
No basis to judge/Not applicable (percent): 15%.
[End of table]
Your agency uses performance information and documentation to make
distinctions in senior executive performance.
EDUCATION;
To a very great extent (percent): 3%;
To a great extent (percent): 21%;
To a moderate extent (percent): 13%;
To a small extent (percent): 23%;
To no extent (percent): 15%;
No basis to judge/Not applicable (percent): 26%.
HHS;
To a very great extent (percent): 8%;
To a great extent (percent): 26%;
To a moderate extent (percent): 24%;
To a small extent (percent): 12%;
To no extent (percent): 5%;
No basis to judge/Not applicable (percent): 25%.
NASA;
To a very great extent (percent): 14%;
To a great extent (percent): 33%;
To a moderate extent (percent): 21%;
To a small extent (percent): 13%;
To no extent (percent): 3%;
No basis to judge/Not applicable (percent): 15%.
[End of table]
Your agency provides candid and constructive feedback that allows you
to maximize your contribution to organizational goals.
EDUCATION;
To a very great extent (percent): 5%;
To a great extent (percent): 18%;
To a moderate extent (percent): 18%;
To a small extent (percent): 28%;
To no extent (percent): 23%;
No basis to judge/Not applicable (percent): 8%.
HHS;
To a very great extent (percent): 10%;
To a great extent (percent): 26%;
To a moderate extent (percent): 28%;
To a small extent (percent): 13%;
To no extent (percent): 17%;
No basis to judge/Not applicable (percent): 6%.
NASA;
To a very great extent (percent): 18%;
To a great extent (percent): 27%;
To a moderate extent (percent): 27%;
To a small extent (percent): 15%;
To no extent (percent): 10%;
No basis to judge/Not applicable (percent): 3%.
[End of table]
8. Involve employees and stakeholders to gain ownership of performance
management systems%.
You have been given the opportunity to be involved in refining your
agency's SES performance management system.
EDUCATION;
To a very great extent (percent): 8%;
To a great extent (percent): 13%;
To a moderate extent (percent): 10%;
To a small extent (percent): 15%;
To no extent (percent): 49%;
No basis to judge/Not applicable (percent): 5%.
HHS;
To a very great extent (percent): 10%;
To a great extent (percent): 13%;
To a moderate extent (percent): 20%;
To a small extent (percent): 13%;
To no extent (percent): 38%;
No basis to judge/Not applicable (percent): 5%.
NASA;
To a very great extent (percent): 6%;
To a great extent (percent): 7%;
To a moderate extent (percent): 15%;
To a small extent (percent): 15%;
To no extent (percent): 51%;
No basis to judge/Not applicable (percent): 6%.
[End of table]
You have been involved in refining your agency's SES performance
management system.
EDUCATION;
To a very great extent (percent): 8%;
To a great extent (percent): 11%;
To a moderate extent (percent): 5%;
To a small extent (percent): 11%;
To no extent (percent): 61%;
No basis to judge/Not applicable (percent): 5%.
HHS;
To a very great extent (percent): 9%;
To a great extent (percent): 13%;
To a moderate extent (percent): 17%;
To a small extent (percent): 14%;
To no extent (percent): 43%;
No basis to judge/Not applicable (percent): 5%.
NASA;
To a very great extent (percent): 5%;
To a great extent (percent): 5%;
To a moderate extent (percent): 13%;
To a small extent (percent): 14%;
To no extent (percent): 58%;
No basis to judge/Not applicable (percent): 5%.
[End of table]
Formal training on your agency's SES performance management system is
available to you.
EDUCATION;
To a very great extent (percent): 5%;
To a great extent (percent): 11%;
To a moderate extent (percent): 26%;
To a small extent (percent): 21%;
To no extent (percent): 26%;
No basis to judge/Not applicable (percent): 11%.
HHS;
To a very great extent (percent): 8%;
To a great extent (percent): 12%;
To a moderate extent (percent): 25%;
To a small extent (percent): 14%;
To no extent (percent): 24%;
No basis to judge/Not applicable (percent): 17%.
NASA;
To a very great extent (percent): 7%;
To a great extent (percent): 21%;
To a moderate extent (percent): 24%;
To a small extent (percent): 13%;
To no extent (percent): 21%;
No basis to judge/Not applicable (percent): 14%.
[End of table]
You have participated in formal training on your agency's SES
performance management system.
EDUCATION;
To a very great extent (percent): 8%;
To a great extent (percent): 8%;
To a moderate extent (percent): 16%;
To a small extent (percent): 22%;
To no extent (percent): 41%;
No basis to judge/Not applicable (percent): 5%.
HHS;
To a very great extent (percent): 8%;
To a great extent (percent): 7%;
To a moderate extent (percent): 23%;
To a small extent (percent): 16%;
To no extent (percent): 42%;
No basis to judge/Not applicable (percent): 4%.
NASA;
To a very great extent (percent): 4%;
To a great extent (percent): 11%;
To a moderate extent (percent): 22%;
To a small extent (percent): 17%;
To no extent (percent): 43%;
No basis to judge/Not applicable (percent): 2%.
[End of table]
Your overall involvement in the SES performance management system has
increased your understanding of it.
EDUCATION;
To a very great extent (percent): 10%;
To a great extent (percent): 13%;
To a moderate extent (percent): 13%;
To a small extent (percent): 26%;
To no extent (percent): 28%;
No basis to judge/Not applicable (percent): 10%.
HHS;
To a very great extent (percent): 11%;
To a great extent (percent): 16%;
To a moderate extent (percent): 21%;
To a small extent (percent): 16%;
To no extent (percent): 21%;
No basis to judge/Not applicable (percent): 15%.
NASA;
To a very great extent (percent): 8%;
To a great extent (percent): 19%;
To a moderate extent (percent): 27%;
To a small extent (percent): 16%;
To no extent (percent): 17%;
No basis to judge/Not applicable (percent): 13%.
[End of table]
9. Overall perceptions of the SES performance management system.
Your agency's SES performance management system is used as a tool to
manage the organization.
EDUCATION;
To a very great extent (percent): 3%;
To a great extent (percent): 23%;
To a moderate extent (percent): 13%;
To a small extent (percent): 31%;
To no extent (percent): 18%;
No basis to judge/Not applicable (percent): 13%.
HHS;
To a very great extent (percent): 6%;
To a great extent (percent): 23%;
To a moderate extent (percent): 35%;
To a small extent (percent): 15%;
To no extent (percent): 8%;
No basis to judge/Not applicable (percent): 12%.
NASA;
To a very great extent (percent): 9%;
To a great extent (percent): 24%;
To a moderate extent (percent): 33%;
To a small extent (percent): 19%;
To no extent (percent): 8%;
No basis to judge/Not applicable (percent): 7%.
[End of table]
Your agency's SES performance management system is used in achieving
organizational goals.
EDUCATION;
To a very great extent (percent): 8%;
To a great extent (percent): 21%;
To a moderate extent (percent): 21%;
To a small extent (percent): 31%;
To no extent (percent): 10%;
No basis to judge/Not applicable (percent): 10%.
HHS;
To a very great extent (percent): 9%;
To a great extent (percent): 27%;
To a moderate extent (percent): 32%;
To a small extent (percent): 11%;
To no extent (percent): 7%;
No basis to judge/Not applicable (percent): 12%.
NASA;
To a very great extent (percent): 13%;
To a great extent (percent): 33%;
To a moderate extent (percent): 28%;
To a small extent (percent): 13%;
To no extent (percent): 7%;
No basis to judge/Not applicable (percent): 5%.
[End of table]
Your agency's SES performance management system holds you accountable
for your contributions to organizational results.
EDUCATION;
To a very great extent (percent): 16%;
To a great extent (percent): 26%;
To a moderate extent (percent): 21%;
To a small extent (percent): 24%;
To no extent (percent): 8%;
No basis to judge/Not applicable (percent): 5%.
HHS;
To a very great extent (percent): 22%;
To a great extent (percent): 27%;
To a moderate extent (percent): 27%;
To a small extent (percent): 12%;
To no extent (percent): 3%;
No basis to judge/Not applicable (percent): 8%.
NASA;
To a very great extent (percent): 20%;
To a great extent (percent): 39%;
To a moderate extent (percent): 22%;
To a small extent (percent): 10%;
To no extent (percent): 6%;
No basis to judge/Not applicable (percent): 4%.
[End of table]
Your agency's SES performance management system facilitates
discussions about your performance as it relates to organizational
goals during the year.
EDUCATION;
To a very great extent (percent): 10%;
To a great extent (percent): 26%;
To a moderate extent (percent): 18%;
To a small extent (percent): 18%;
To no extent (percent): 21%;
No basis to judge/Not applicable (percent): 8%.
HHS;
To a very great extent (percent): 12%;
To a great extent (percent): 27%;
To a moderate extent (percent): 26%;
To a small extent (percent): 20%;
To no extent (percent): 8%;
No basis to judge/Not applicable (percent): 8%.
NASA;
To a very great extent (percent): 18%;
To a great extent (percent): 31%;
To a moderate extent (percent): 22%;
To a small extent (percent): 15%;
To no extent (percent): 10%;
No basis to judge/Not applicable (percent): 5%.
[End of table]
Your agency's SES performance management system helps to maintain a
consistent focus on organizational goals during transitions, such as
changes in leadership (at any level) and change management initiatives.
EDUCATION;
To a very great extent (percent): 10%;
To a great extent (percent): 15%;
To a moderate extent (percent): 26%;
To a small extent (percent): 18%;
To no extent (percent): 21%;
No basis to judge/Not applicable (percent): 10%.
HHS;
To a very great extent (percent): 10%;
To a great extent (percent): 28%;
To a moderate extent (percent): 24%;
To a small extent (percent): 17%;
To no extent (percent): 10%;
No basis to judge/Not applicable (percent): 12%.
NASA;
To a very great extent (percent): 13%;
To a great extent (percent): 24%;
To a moderate extent (percent): 24%;
To a small extent (percent): 20%;
To no extent (percent): 11%;
No basis to judge/Not applicable (percent): 9%.
[End of table]
[End of section]
Appendix III: Selected Elements of Education's, HHS's, and NASA's SES
Performance Management Systems:
Education:
Defining SES Performance Expectations:
Education required all of its senior executives to include three
critical elements in their individual performance plans for the 2003
performance appraisal cycle (July 2002-June 2003). The critical
elements and examples of the related individual and organizational
performance requirements include the following.
* Leadership, management, and coaching: Takes leadership in promoting
and implementing the department's mission, values, and goals; develops
and communicates a clear, simple, customer-focused vision/direction for
the organization and customers that is consistent with the department's
mission and strategic goals; fosters improved workforce productivity
and effective development and recognition of employees; and promotes
collaboration and teamwork, including effective union-management
relations, where appropriate.
* Work quality, productivity, and customer service: Produces or assures
quality products that are useful and succinct, that identify and
address problems or issues, and that reflect appropriate analysis,
research, preparation, and sensitivity to department priorities and
customer needs; anticipates and responds to customer needs in a
professional, effective, and timely manner; initiates new and better
ways of doing things; and creates real and positive change.
* Job specifics: Senior executives are to include performance
expectations that are applicable to their individual positions and
support their principal offices' goals as well as the department's
strategic goals and priorities, including the President's Management
Agenda, the Blueprint for Management Excellence, and the Culture of
Accountability.
Appraising Performance:
Education sets guidelines for its offices to follow in appraising
performance and recommending senior executives for bonuses. The senior
executive performance appraisals are to be based on demonstrated
results related to Education's goals and priorities, including the
President's Management Agenda, the Blueprint for Management Excellence,
the Culture of Accountability, and the Secretary's strategic plan. In
addition, the senior executive's appraisal is to be based on both
individual and organizational performance, taking into account:
* results achieved in accordance with the department's strategic plan
and goals, which are developed in accordance with the Government
Performance and Results Act of 1993 (GPRA);
* customer satisfaction;
* employee perspectives;
* the effectiveness, productivity, and performance quality of the
employees for whom the senior executive is responsible; and:
* equal employment opportunity and diversity and complying with merit
systems principles.
In addition, the responses of the customers, coworkers, and employees
through the automated performance feedback process are to be considered
in determining the senior executive's performance rating.
Senior executives must receive a performance rating of "successful" to
be eligible for a bonus. Bonus recommendations are to be based on the
senior executive's demonstrated results and accomplishments toward the
department's strategic goals and organizational priorities.
Accomplishments should demonstrate how Education's achievements could
not have been possible without the senior executive's leadership and
contribution.
HHS:
Defining SES Performance Expectations:
HHS required its senior executives to set measurable, specific
performance expectations in their fiscal year 2003 individual
performance plans (or performance contracts) that align with HHS's
strategic goals, the "One-HHS" management and program objectives, and
their operating divisions' annual performance goals. According to
agency officials, senior executives are to choose the One-HHS
objectives and strategic and annual performance goals that relate to
their job responsibilities, and tailor their individual performance
expectations to reflect these responsibilities in their performance
plans.
The One-HHS objectives, which reflect the program and management
priorities of the Secretary, include the following.
Management objectives: The purpose of the objectives is to better
integrate HHS management functions to ensure coordinated, seamless, and
results-oriented management across all operating and staff divisions of
the department.
1. Implement results-oriented management.
2. Implement strategic human capital management.
3. Improve grants management operation and oversight.
4. Complete the fiscal year 2003 competitive sourcing program.
5. Improve information technology management.
6. Administrative efficiencies.
7. Continue implementation of unified financial management system.
8. Consolidate management functions.
9. Achieve efficiencies through HHS-wide procurements.
10. Conduct program evaluations and implement corrective strategies for
any deficiencies identified.
Program objectives: The purpose of the objectives is to enhance the
health and well-being of Americans by providing for effective health
and human services and by fostering strong, sustained advances in the
sciences underlying medicine, public health, and social services.
1. Increase access to health care (Closing the Gaps in Health Care).
2. Expand consumer choices in health care and human services.
3. Emphasize preventive health measures (Preventing Disease and
Illness).
4. Prepare for and effectively respond to bioterrorism and other public
health emergencies (Protecting Our Homeland).
5. Improve health outcomes (Preventing Disease and Illness).
6. Improve the quality of health care (21st Century Health Care).
7. Advance science and medical research (Improving Health Science).
8. Improve the well-being and safety of families and individuals,
especially vulnerable populations (Leaving No Child Behind).
9. Strengthen American families (Working Toward Independence).
10. Reduce regulatory burden on providers, patients, and consumers of
HHS's services.
In addition to the annual performance goals, operating divisions may
have their senior executives include specific individual performance
expectations in their performance plans. According to an agency
official, the senior executives in FDA have set expectations in their
plans that are relevant to the work in their centers. For example, the
senior executives who work on issues related to mad cow disease in the
Center for Veterinary Medicine have included goals related to this type
of work in their individual performance plans.
Appraising Performance:
HHS sets general guidance for operating divisions to follow when
appraising senior executive performance and recommending senior
executives for bonuses and other performance awards, such as the
Presidential Rank Awards. Overall, a senior executive's performance is
to be appraised at least annually based on a comparison of actual
performance with expectations in the individual performance plan. The
operating divisions are to appraise senior executive performance taking
into account such factors as:
* measurable results achieved in accordance with the goals of GPRA;
* customer satisfaction;
* employee perspectives;
* the effectiveness, productivity, and performance quality of the
employees for whom the executive is responsible; and:
* meeting affirmative action, equal employment opportunity, and
diversity goals and complying with the merit systems principles.
In recommending senior executives for bonuses, operating divisions are
to consider each senior executive's performance, including the rating
and the extent of the executive's contributions to meeting
organizational goals. Senior executives who receive ratings of "fully
successful" are eligible to be considered for bonuses. For fiscal year
2003, bonuses generally were to be recommended for no more than one-
third of the operating division's senior executives and awarded to only
the exceptional performers. Operating divisions were to consider
nominating only one or two of their very highest contributors for the
governmentwide Presidential Rank Awards. The greatest consideration for
bonuses and Presidential Rank Awards was to be given to executives in
frontline management positions, with direct responsibility for HHS's
programs.
NASA:
Defining SES Performance Expectations:
NASA requires its senior executives to include seven critical elements,
which reflect the Administrator's priorities and NASA's core values of
safety, people, excellence, and integrity, in their individual
performance plans for the 2004 performance appraisal cycle (July 2003-
June 2004). Senior executives may modify the related performance
requirements by making them more specific to their jobs. These seven
critical elements and the related performance requirements are as
follows.
* The President's Management Agenda: Understands the principles of the
President's Management Agenda and actively applies them; assures
maximum organizational efficiency, is customer focused, and
incorporates presidential priorities in budget and performance plans;
capitalizes on opportunities to integrate human capital issues in
planning and performance and expand electronic government and
competitive sourcing; and pursues other opportunities to reduce costs
and improve service to customers.
* Performance requirement: Applicable provisions of the agency human
capital plan are implemented; financial reports are timely and
accurate; clear measurable programmatic goals and outcomes are linked
to the agency strategic plan and the GPRA performance plan; and human
capital, e-government, and competitive sourcing goals are achieved.
* Health of NASA: Actions contribute to safe and successful mission
accomplishment and/or strengthen infrastructure of support functions;
increases efficient and effective management of the agency; facilitates
knowledge sharing within and between programs and projects; and
displays unquestioned personal integrity and commitment to safety.
* Performance requirement: Demonstrates that safety is the
organization's number one value; actively participates in safety and
health activities, supports the zero lost-time injury goals, and takes
action to improve workforce health and safety; meets or exceeds cost
and schedule milestones and develops creative mechanisms and/or
capitalizes on opportunities to facilitate knowledge sharing; and
achieves maximum organizational efficiency through effective resource
utilization and management.
* Equal opportunity (EO) and diversity: Demonstrates a commitment to EO
and diversity by proactively implementing programs that positively
impact the workplace and NASA's external stakeholders and through
voluntary compliance with EO laws, regulations, policies, and
practices; this includes such actions as ensuring EO in hiring by
providing, if needed, reasonable accommodation(s) to an otherwise
qualified individual with a disability or ensuring EO without regard to
race, color, national origin, sex, sexual orientation, or religion in
all personnel decisions and in the award of grants or other federal
funds to stakeholder recipients.
* Performance requirement: Actively supports EO/diversity efforts;
consistently follows applicable EO laws, regulations, Executive Orders,
and administration and NASA policies, and the principles thereof, in
decision making with regard to employment actions and the award of
federal grants and funds; cooperates with and provides a timely and
complete response to NASA's Discrimination Complaints Division, the
U.S. Equal Employment Opportunity Commission, and the courts during the
investigation, resolution, and/or litigation of allegations of illegal
discrimination under applicable EO laws and regulations.
* Collaboration: Integrates One-NASA approach to problem solving,
program/project management, and decision making; leads by example by
reaching out to other organizations and NASA centers to collaborate on
work products; seeks input and expertise from a broad spectrum; and
demonstrates possession of organizational and interpersonal skills.
* Performance requirement: Provides the appropriate level of high-
quality support to peers and other organizations to enable the
achievement of the NASA mission; results demonstrate support of One-
NASA and that stakeholder and customer issues were taken into account.
* Professional development: Has a breadth of experience in different
organizations, agencies, functional areas, and/or geographic
locations; demonstrates continual learning in functional and leadership
areas, for example, through advanced education/training or
participating in seminars; encourages and supports development and
training of assigned staff; and where feasible, seeks, accepts, and
encourages opportunities for developmental assignments in other
functional areas and elsewhere in NASA, with a focus on broadening
agencywide perspective.
* Performance requirement: Participates in training/learning
experiences appropriate to position responsibilities and to broaden
agencywide perspective and actively plans for and supports the
participation of subordinate staff in training and development
activities.
* Meets program objectives: Meets and advances established agency
program objectives and achieves high-quality results; demonstrates the
ability to follow through on commitments; and individual fits into
long-term human capital strategy and could be expected to make future
contributions at a higher level or in a different capacity at the same
level.
* Performance requirement: Meets appropriate GPRA/NASA strategic plan
goals and objectives; customers recognize results for their high-
quality and responsiveness to requirements/agreements.
* Implements a fair and equitable performance-based system within
organizational component (applicable only for supervisory positions):
Implements/utilizes a fair, equitable, and merit/performance-based
process/system for the evaluation of individuals for bonuses,
promotions, career advancements, and general recognition.
* Performance requirement: System reflects the key leadership,
teamwork, and professional excellence on which decisions are based;
results have credibility with supervisors, subordinates, and peers.
Appraising Performance:
NASA provides guidance for the centers and offices to follow in
appraising senior executive performance and recommending executives for
bonuses or other performance awards, such as Presidential Rank Awards
or incentive awards. The senior executive's performance appraisal is to
focus on results toward the performance requirements specified in the
individual performance plan, specifically the achievements that address
the agency's goals rather than the quality of effort expended. In
addition, senior executive appraisals are to be based on individual and
organizational performance, taking into account such factors as:
* results achieved in accordance with the goals of GPRA;
* the effectiveness, productivity, and performance of assigned
employees;
* meeting safety and diversity goals;
* complying with merit system principles;
* customer perspective focusing on customer needs, expectations, and
satisfaction;
* employee perspective focusing on employee needs, such as training,
internal processes, and tools to successfully and efficiently
accomplish their tasks; and:
* business perspective focusing on outcomes and the social/political
impacts that define the role of the agency and the business processes
needed for organizational efficiency and effectiveness.
In considering customer, employee, and other stakeholder perspectives
for senior executive appraisals, rating officials may use formal
mechanisms, such as surveys, or less formal mechanisms, such as
unsolicited customer and employee feedback, and analysis of personnel
data, such as turnover rates, diversity reports, grievances, and
workforce awards and recognition.
All senior executives with annual summary ratings of "fully successful"
or higher are eligible to be considered for bonuses. Bonus
recommendations are to be based solely on exceptional performance as
specified and documented in the senior executive's performance plan.
[End of section]
Appendix IV: Comments from the Department of Education:
UNITED STATES DEPARTMENT OF EDUCATION:
OFFICE OF MANAGEMENT:
ASSISTANT SECRETARY:
May 7, 2004:
J. Christopher Mihm:
Managing Director, Strategic Issues
U.S. General Accounting Office
Washington, DC 20548:
Dear Mr. Mihm:
The Department of Education (ED) has reviewed the draft report entitled
Human Capital: Senior Executive Performance Management Can Be
Significantly Strengthened to Achieve Results.
Thank you for recognizing ED as having undertaken important and
valuable efforts to link senior executive performance management
systems to the success of its senior executives. In addition, we
appreciate the fact that you acknowledged that ED has begun to
implement key practices to develop an effective performance management
system for career senior executives.
The recommendations provided by the General Accounting Office to fully
maximize the performance management system to manage organizations and
achieve organizational goals have been carefully reviewed.
Although ED has provided responses to those recommendations in the
enclosures, it is important to note that our existing senior executive
performance management system will change dramatically. Draft
regulations for the new Senior Executive Service pay-for-performance
system are now being circulated for review and comment. Specifically,
more meaningful distinctions in performance will be made; there will be
greater emphasis on performance and demonstrated results; and pay and
performance will be greater linked.
Thank you for the opportunity to provide comments to the executive
performance management study.
If there are any questions, please contact Veronica Trietsch, Director,
Human Resources Services at (202) 401-0553.
Sincerely,
Signed by:
William J. Leidinger:
Enclosures:
GAO Recommendations for Executive Action:
GAO Recommendation: Require senior executives to set specific levels
ofperformance that are linked to organizational goals to help them see
how they directly contribute to organizational goals.
GAO also recommends making meaningful distinctions in senior executive
performance through both ratings and bonuses.
ED response: GAO has recognized that all ED performance plans
identified individual performance expectations that are aligned with
organizational goals: To finther enhance this requirement, ED's current
executive appraisal system is already undergoing revisions with greater
emphasis on a results-oriented evaluation system with a concentration
of alignment of ED's mission, the Secretary's Strategic Plan, goals and
priorities. Also, the SES proposed new performance management system
will change from it's current 3-level system to a proposed 5-level
system. Pay and award differentiations will additionally be emphasized
for those who have performed at the highest levels and who have met
ED's performance goals.
GAO Recommendation: Require senior executives to identify in their
individual performance plans programmatic crosscutting goals that would
require collaboration to achieve and identify the internal andlor
external organizations with whom they would collaborate to achieve
these goals.
ED response: The GAO study indicated that most SES employees in ED
indicated that they collaborate with others to achieve crosscutting
goals. However, fewer of these executives felt that their contributions
to crosscutting goals were recognized through the performance
management system. GAO recommends requiring senior executives to
identify the internal and/or external organizations with whom they
would collaborate to reinforce a focus across organizational
boundaries.
ED recognizes. the importance of collaboration and teamwork across
organizational boundaries. In fact, ED's current SES performance
management system specifically identifies "collaboration and teamwork"
as one of the required performance standards for the critical element
under leadership; management and coaching for all ED SES employees. As
such, ED does not recommend requiring the specific identification of
the intemal/external organizations with whom the executives
collaborate.
GAO Recommendation: Provide disaggregated performance information from
various sources to help facilitate senior executive decision-making and
progress in achieving organizational results, customer satisfaction,
and employee perspectives.
ED Response: ED has demonstrated where it has fully met this
recommendation. GAO has cited that while all three agencies give their
components the flexibility to collect and provide performance
information to their senior executives, ED also was cited as providing
performance information on an agency-wide basis. GAO also stated in
their study that ED provides various types of performance information
to senior executives to help them see how they are meeting the
performance expectations in their individual performance plans. Also
noted in the GAO study is ED's tracking system that monitors the
Department's progress towards its annual performance goals and
supporting action steps. Each action step has milestones that are
tracked and reported on a monthly basis to the officials that developed
and have ownership for them. GAO has also noted where ED also collects
performance information on customer service and employee perspectives.
GAO Recommendation: Require all senior executives to take follow up
actions based on the performance information available to them in order
to make programmatic improvements and formally recognize executive for
these actions.
ED response: The GAO study noted that at ED, only those senior
executives who developed action steps for ED's annual goals are
required to set milestones that are tracked on a monthly basis, assess
how they are progressing towards the actions steps and annual goals,
and revise future milestones, 'if necessary: GAO recommends this
activity for all SES employees.
ED's proposed revisions to its executive appraisal system that affects
all SES employees, already incorporates standards with milestones and
execution target dates, and follow-up actions with an emphasis on
outcomes, program improvements, improved quality, and other
deliverables.
GAO Recommendation: Build in additional safeguards when linking pay to
performance by communicating the results of the performance rating and
bonus decisions.
ED response: Each Principal Office at ED is provided with the results
of their senior executives' rating and bonus distribution. An agency-
wide aggregate distribution of performance ratings or bonuses will be
given consideration.
GAO Recommendation Involve senior executives in future refinements to
the performance management system and offer oFfer training on the
system, as appropriate.
ED response: In the past, all ED SES executives have been given the
opportunity to participate in refining the SES performance management
system. This practice of senior executive involvement will continue as
ED proceeds to make changes to it's current executive performance
management system.
[End of section]
Appendix V: Comments from the Department of Health and Human Services:
DEPARTMENT OF HEALTH & HUMAN SERVICES
Office of Inspector General:
Washington, D.C. 20201:
MAY 4 2004:
Mr. J. Christopher Mihm:
Managing Director, Strategic Issues
United States General Accounting Office
Washington, D.C. 20548:
Dear Mr. Mihm:
The Department has reviewed your draft report entitled, "Human Capital:
Senior Executive Performance Management Can Be Significantly
Strengthened to Achieve Results" (GAO-04-614) and has no comments at
this time.
The Department appreciates the opportunity to comment on this draft
report before its publication.
Sincerely,
Signed by:
Dara Corrigan:
Acting Principal Deputy Inspector General:
Enclosure:
The Office of Inspector General (OIG) is transmitting the Department's
response to this draft report in our capacity as the Department's
designated focal point and coordinator for General Accounting Office
reports. OIG has not conducted an independent assessment of these
comments and therefore expresses no opinion on them.
[End of section]
Appendix VI: Comments from the National Aeronautics and Space
Administration:
National Aeronautics and Space Administration:
Office of the Administrator
Washington, DC 20546-0001:
May 14, 2004:
Mr. J. Christopher Mihm:
Managing Director:
Strategic Issues:
United States General Accounting Office:
Washington, DC 20548:
Dear Mr. Mihm:
I appreciate the opportunity to comment on GAO draft report GAO-04-614,
"Senior Executive Performance Management Can Be Significantly
Strengthened to Achieve Results." While the report is generally
positive, there is always room for improvement, and the recommendations
in the report will help to improve our SES appraisal system. In
general, the findings in the report support our own conclusions from
our review of the data.
The draft report recommends both system and process changes. The three
recommendations for system change (the first, second, and eighth
recommendation) recommend increasing the specificity in performance
standards. The five process recommendations focus on providing more
feedback to managers and employees on performance and bonus results
(the third, fourth, and fifth recommendations), making meaningful
performance distinctions in both ratings and bonuses (the sixth
recommendation) and having more employee involvement in future system
modifications and offering appropriate training on the system (the
seventh recommendation).
The systems change recommendations may all be implemented through minor
changes to our current system. To this end, we will engage our SES
workforce and implement the recommendations in the next SES appraisal
cycle, beginning July 1, 2004. With regard to the recommended process
changes, we will provide feedback on performance and bonus results
beginning with the next appraisal cycle and will begin immediately to
have more employee involvement in future systems changes and offer more
training on the appraisal system. We will also reemphasize the
importance of developing rigorous performance standards, and we will
hold executives accountable for making meaningful distinctions in
ratings and bonuses based on these standards, beginning with the rating
and bonus determinations that will be made as of the end of the current
rating cycle, June 30, 2004.
Cordially,
Signed by:
Frederick D. Gregory:
Deputy Administrator:
Enclosure:
National Aeronautics and Space Administration:
Comments on GAO Draft Report GAO-04-614 Senior Executive Performance
Management Can Be Strengthened to Achieve Results:
Recommendation 1: "Require senior executives to set specific levels of
performance that are linked to organizational goals to help them see
how they directly contribute to organizational goals."
Response: Concur. This recommendation will be implemented through minor
changes to our current system. We will engage NASA's SES workforce and
implement the recommendation in the next SES appraisal cycle, beginning
July 1, 2004.
Recommendation 2: "Require senior executives to identify in their
individual performance plans programmatic crosscutting goals that would
require collaboration to achieve and identify the internal and/or
external organizations with whom they would collaborate to achieve
these goals."
Response: Concur. This recommendation will be implemented through minor
changes to our current system. We will engage NASA's SES workforce and
implement the recommendation in the next SES appraisal cycle, beginning
July 1, 2004.
Recommendation 3: "Provide disaggregated performance information from
various sources to help facilitate senior executive decisionmaking and
progress in achieving organizational results, customer satisfaction,
and employee perspectives."
Response: Concur. NASA management will provide feedback on performance
and bonus results in the next appraisal cycle that begins July 1, 2004.
Recommendation 4: "Require all senior executives to take follow up
actions based on the performance information available to them in order
to make programmatic improvements and formally recognize executives for
these actions."
Response: Concur. This recommendation will be implemented through minor
changes to our current system. We will engage NASA's SES workforce and
implement the recommendation in the next SES appraisal cycle, beginning
July 1, 2004.
Reconnnendation 5: "Build in additional safeguards when linking pay to
performance by communicating the results of the performance rating and
bonus decisions."
Response: Concur. NASA management will provide feedback on performance
and bonus results in the next appraisal cycle that begins July 1, 2004.
Recommendation 6: "Make meaningful distinctions in senior executive
performance through both ratings and bonuses."
Response: Concur. NASA management will reemphasize the importance of
developing rigorous performance standards and hold executives
accountable for making meaningful distinctions in ratings and bonuses
based on these standards, beginning with the rating and bonus
determinations that will be made as of the end of the current rating
cycle, June 30, 2004.
Recommendation 7: "Involve senior executives in future refinements to
the performance management system and offer training on the system, as
appropriate."
Response: Concur. NASA management will begin immediately to have more
employee involvement in future systems changes and offer more training
on the appraisal system.
Recommendation 8: "Set specific performance expectations for senior
executives related to leading and facilitating change management
initiatives during ongoing transitions throughout the organization that
executives should include in their individual performance plans."
Response: Concur. This recommendation will be implemented through minor
changes to our current system. We will engage NASA's SES workforce and
implement the recommendation in the next SES appraisal cycle, beginning
July 1, 2004.
[End of section]
Appendix VII: GAO Contacts and Staff Acknowledgments:
GAO Contacts:
J. Christopher Mihm, (202) 512-6806 or m [Hyperlink, mihmj@gao.gov]
ihmj@gao.gov Lisa Shames, (202) 512-6806 or s [Hyperlink,
shamesl@gao.gov] hamesl@gao.gov:
Acknowledgments:
In addition to the individuals named above, Janice Lichty Latimer, Erik
Hallgren, Ronald La Due Lake, Mark Ramage, Nyree M. Ryder, and Jerry
Sandau made key contributions to this report.
(450230):
FOOTNOTES
[1] For additional information on the attributes of high-performing
organizations, see U.S. General Accounting Office, Highlights of a GAO
Forum on High-Performing Organizations: Metrics, Means, and Mechanisms
for Achieving High Performance in the 21st Century Public Management
Environment, GAO-04-343SP (Washington, D.C.: Feb. 13, 2004).
[2] 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).
[3] U.S. Office of Personnel Management, "Memorandum for Heads of
Departments and Agencies, Regulations Implementing the Senior Executive
Service (SES) Performance-Based Pay System" (Washington, D.C.: Apr. 28,
2004).
[4] U.S. General Accounting Office, Results-Oriented Cultures: Creating
a Clear Linkage between Individual Performance and Organizational
Success, GAO-03-488 (Washington, D.C.: Mar. 14, 2003).
[5] For our review of a sample of SES performance plans, unless
otherwise noted, the margins of error are within ± 9 percentage points
for HHS and ± 6 percentage points for NASA. For Education, there is no
sampling error since we reviewed all the SES plans. For our SES survey,
unless otherwise noted, the margins of error are within ± 9 percentage
points for Education and ± 4 percentage points for HHS and NASA.
[6] National Defense Authorization Act for Fiscal Year 2004, Pub. L.
No. 108-136, November 24, 2003.
[7] GAO-03-488.
[8] U.S. General Accounting Office, Results-Oriented Government: GPRA
Has Established a Solid Foundation for Achieving Greater Results, GAO-
04-38 (Washington, D.C.: Mar. 10, 2004).
[9] GAO-02-966.
[10] The One-HHS management and program objectives reflect the goals
and priorities of the Secretary.
[11] The 95 percent confidence interval for NASA ranges from 16 to 33
percent.
[12] GAO-04-343SP.
[13] GAO-02-966.
[14] GAO-02-966.
[15] Agency officials indicated that they plan to reevaluate the use of
this system in the future given the changes occurring with the new SES
pay system.
[16] For more information on CDC's tracking of performance information,
see U.S. General Accounting Office, Centers for Disease Control and
Prevention: Agency Leadership Taking Steps to Improve Management and
Planning, but Challenges Remain, GAO-04-219 (Washington, D.C.: Jan. 30,
2004).
[17] U.S. General Accounting Office, Human Capital: Implementing Pay
for Performance at Selected Personnel Demonstration Projects, GAO-04-
83 (Washington, D.C.: Jan. 23, 2004).
[18] See app. III for more information on selected elements of
Education's, HHS's and NASA's SES performance management systems.
[19] About 98 percent of the senior executives at Education included a
competency related to employee perspectives.
[20] GAO-04-38.
[21] U.S. Office of Personnel Management, "Memorandum for Heads of
Departments and Executive Agencies, Reporting SES Performance Ratings
and Awards for FY 2003" (Washington, D.C.: Feb. 12, 2004).
[22] By law, bonus amounts paid to individual career senior executives
are limited to from 5 to 20 percent of the executive's basic pay.
Agency bonus totals cannot exceed the greater of 10 percent of the
aggregate career senior executive basic pay or 20 percent of the
average rates of career senior executive basic pay.
[23] Under HHS's three-level system senior executives may be rated at
"fully successful," "minimally satisfactory," or "unsatisfactory," and
under a five-level system, senior executives may be rated at these
rating levels as well as at "excellent" and "outstanding."
[24] In fiscal year 2002, only the Centers for Medicare and Medicaid
Services used a five-level rating system. In fiscal year 2003, the
Indian Health Service also used a five-level rating system.
[25] Under Education's three-level system, senior executives may be
rated at "successful," "minimally satisfactory," and "unsatisfactory."
[26] For more information on how to assess agencies' training and
development efforts, see U.S. General Accounting Office, Human Capital:
A Guide for Assessing Strategic Training and Development Efforts in the
Federal Government, GAO-04-546G (Washington, D.C.: March 2004).
[27] U.S. General Accounting Office, Results-Oriented Cultures:
Implementation Steps to Assist Mergers and Organizational
Transformations, GAO-03-669 (Washington, D.C.: July 2, 2003).
[28] U.S. General Accounting Office, High-Risk Series: Strategic Human
Capital Management, GAO-03-120 (Washington, D.C.: January 2003).
[29] GAO-03-488.
[30] U.S. General Accounting Office, NASA: Shuttle Fleet's Safe Return
to Flight Is Key to Space Station Progress, GAO-04-201T (Washington,
D.C.: Oct. 29, 2003).
[31] U.S. General Accounting Office, Major Management Challenges and
Program Risks: Department of Education, GAO-03-99 (Washington, D.C.:
January 2003).
[32] GAO-03-488.
[33] For HHS, when the question refers to "my agency" or "my
organization," we asked senior executives to respond regarding their
operating divisions within HHS. For the questions on performance
information, we asked NASA senior executives to respond on the extent
that NASA or their center formally provides performance information.
[34] GAO-03-488.
[35] Percentages for each question may not add to 100 due to rounding.
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