[House Hearing, 114 Congress]
[From the U.S. Government Publishing Office]
MAKING DHS MORE EFFICIENT: INDUSTRY
RECOMMENDATIONS TO IMPROVE HOMELAND SECURITY
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HEARING
before the
SUBCOMMITTEE ON
OVERSIGHT AND
MANAGEMENT EFFICIENCY
of the
COMMITTEE ON HOMELAND SECURITY
HOUSE OF REPRESENTATIVES
ONE HUNDRED FOURTEENTH CONGRESS
FIRST SESSION
__________
SEPTEMBER 18, 2015
__________
Serial No. 114-33
__________
Printed for the use of the Committee on Homeland Security
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Available via the World Wide Web: http://www.gpo.gov/fdsys/
__________
U.S. GOVERNMENT PUBLISHING OFFICE
99-575 PDF WASHINGTON : 2016
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Washington, DC 20402-0001
Michael T. McCaul, Texas, Chairman
Lamar Smith, Texas Bennie G. Thompson, Mississippi
Peter T. King, New York Loretta Sanchez, California
Mike Rogers, Alabama Sheila Jackson Lee, Texas
Candice S. Miller, Michigan, Vice James R. Langevin, Rhode Island
Chair Brian Higgins, New York
Jeff Duncan, South Carolina Cedric L. Richmond, Louisiana
Tom Marino, Pennsylvania William R. Keating, Massachusetts
Lou Barletta, Pennsylvania Donald M. Payne, Jr., New Jersey
Scott Perry, Pennsylvania Filemon Vela, Texas
Curt Clawson, Florida Bonnie Watson Coleman, New Jersey
John Katko, New York Kathleen M. Rice, New York
Will Hurd, Texas Norma J. Torres, California
Earl L. ``Buddy'' Carter, Georgia
Mark Walker, North Carolina
Barry Loudermilk, Georgia
Martha McSally, Arizona
John Ratcliffe, Texas
Daniel M. Donovan, Jr., New York
Brendan P. Shields, Staff Director
Joan V. O'Hara, General Counsel
Michael S. Twinchek, Chief Clerk
I. Lanier Avant, Minority Staff Director
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SUBCOMMITTEE ON OVERSIGHT AND MANAGEMENT EFFICIENCY
Scott Perry, Pennsylvania, Chairman
Jeff Duncan, South Carolina Bonnie Watson Coleman, New Jersey
Curt Clawson, Florida Cedric L. Richmond, Louisiana
Earl L. ``Buddy'' Carter, Georgia Norma J. Torres, California
Barry Loudermilk, Georgia Bennie G. Thompson, Mississippi
Michael T. McCaul, Texas (ex (ex officio)
officio)
Ryan Consaul, Subcommittee Staff Director
Dennis Terry, Subcommittee Clerk
Cedric C. Haynes, Minority Subcommittee Staff Director
C O N T E N T S
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Page
Statements
The Honorable Scott Perry, a Representative in Congress From the
State of Pennsylvania, and Chairman, Subcommittee on Oversight
and Management Efficiency:
Oral Statement................................................. 1
Prepared Statement............................................. 3
The Honorable Bonnie Watson Coleman, a Representative in Congress
From the State of New Jersey, and Ranking Member, Subcommittee
on Oversight and Management Efficiency......................... 4
The Honorable Bennie G. Thompson, a Representative in Congress
From the State of Mississippi, and Ranking Member, Committee on
Homeland Security:
Prepared Statement............................................. 11
Witnesses
Mr. Marc A. Pearl, President and Chief Executive Officer,
Homeland Security and Defense Business Council:
Oral Statement................................................. 12
Prepared Statement............................................. 14
Mr. Harry Totonis, Board Director, Business Executives for
National Security:
Oral Statement................................................. 19
Prepared Statement............................................. 20
Ms. Elaine C. Duke, Principal, Elaine Duke & Associates, LLC:
Oral Statement................................................. 22
Prepared Statement............................................. 24
For the Record
The Honorable Bonnie Watson Coleman, a Representative in Congress
From the State of New Jersey, and Ranking Member, Subcommittee
on Oversight and Management Efficiency:
Statement of Daniel M. Gerstein, The RAND Corporation.......... 4
Appendix
Question From Chairman Scott Perry for Marc A. Pearl............. 47
Questions From Ranking Member Bennie G. Thompson for Marc A.
Pearl.......................................................... 47
Questions From Chairman Scott Perry for Harry Totonis............ 50
Questions From Ranking Member Bennie G. Thompson for Harry
Totonis........................................................ 51
Question From Chairman Scott Perry for Elaine C. Duke............ 52
Questions From Ranking Member Bennie G. Thompson for Elaine C.
Duke........................................................... 52
MAKING DHS MORE EFFICIENT: INDUSTRY RECOMMENDATIONS TO IMPROVE HOMELAND
SECURITY
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Friday, September 18, 2015
U.S. House of Representatives,
Subcommittee on Oversight and
Management Efficiency,
Committee on Homeland Security,
Washington, DC.
The subcommittee met, pursuant to call, at 10:05 a.m., in
Room 311, Cannon House Office Building, Hon. Scott Perry
[Chairman of the subcommittee] presiding.
Present: Representatives Perry, Clawson, Carter,
Loudermilk, Watson Coleman, and Torres.
Mr. Perry. The Committee on Homeland Security Subcommittee
on Oversight and Management Efficiency will come to order. The
purpose of this hearing is to continue our examination of ways
to make the Department of Homeland Security more efficient.
The Chair now recognizes himself for an opening statement.
Today's hearing provides us with an important opportunity to
examine how the Department of Homeland Security can improve its
management using proven private-sector best practices. In the
early years after the creation of DHS, the Department of
Homeland Security, Department officials understandably were
focused on preventing another major attack on the homeland.
However, from the outset, DHS faced significant challenges,
including consolidating 22 preexisting component agencies,
reporting to a multitude of Congressional committees, and
working diligently to strike the balance between National
security and protecting privacy and civil liberties.
Furthermore, a long-standing failure to adhere to strong
management practices led to high-profile failures, such as
wasting $1 billion on the failed Secure Border Initiative
Network, the SBInet, and mothballed puffer machines that
eventually were pulled from airports. Such mismanagement eroded
public confidence in DHS and continues to hinder it today.
DHS components, including Customs and Border Protection,
CBP; Transportation Security Administration, TSA; Coast Guard;
Federal Emergency Management Agency, FEMA; and others continue
to revert to their practices used prior to joining DHS and
often seek to fly under the radar of headquarters' oversight.
More than 10 years after its creation, DHS continues to face
conflicting cultures and processes. In addition, senior DHS
officials often failed to hold components accountable and
lacked the information necessary to make sound decisions.
Secretary Johnson has refocused DHS efforts to improve
management practices and increase interagency coordination. His
Unity of Effort initiative creates new processes to ensure that
everyone is driving towards common goals and objectives. For
example, DHS's new Joint Requirements Council seeks to ensure
that components leverage common technologies and platforms.
Previous stovepipes led to components buying different
technologies to meet very similar requirements. The examples
include CBP and Coast Guard air and marine assets and component
tactical radio systems. Because these efforts are so recent, we
are unclear as to whether the new processes will transform how
DHS manages its programs or simply adds other layers to an
already massive bureaucracy.
Private-sector companies respect the value of using sound
management practices. Commercial firms must often deal with
mergers, acquisitions, and restructuring. Having started and
managed a small business in Pennsylvania, I understand the
importance of sound planning combined with strong, capable
leadership and accountability. For example, before undertaking
a major project, commercial firms must have a sound business
case to ensure the project is viable. A sound business case is
critical to mitigating risk and ensures that managers have
sufficient knowledge as the project moves forward. Because the
private sector is focused on getting a return on its
investment, commercial firms would be much more cautious about
risking projects with cost overruns and schedule delays.
In contrast, DHS all too often has ignored risks and moved
forward with unachievable programs, leading to wasted taxpayer
dollars and late, costly, and unimpressive results. DHS has
much to learn from private-sector best practices. The private
sector also routinely analyzes its overhead to streamline and
maximize efficiencies.
DHS, however, struggles to streamline its information
technology programs, modernize its financial systems, and
consolidate its real property inventory which result in a
significant inability to cut waste. For example, two inspector
general reports last month found that the DHS has done a poor
job of tracking costs related to its warehouse inventory and
conference spending. According to the IG, CBP could put $1
million to better use if it improved warehouse management. This
might not seem like a lot to Washington bureaucrats, but my
constituents in Pennsylvania would much prefer that that money
be spent toward securing the border.
DHS must learn from the proven techniques and practices of
successful commercial firms. Federal bureaucrats need to
remember that the American people are their shareholders. Their
tax dollars must be safeguarded, not wasted. As the Nation
faces significant homeland security threats and our National
debt continues to climb, we can afford no more mismanagement.
[The statement of Mr. Perry follows:]
Statement of Chairman Scott Perry
September 18, 2015
Today's hearing provides us with an important opportunity to
examine how the Department of Homeland Security (DHS) can improve its
management using proven, private-sector best practices. In the early
years after the creation of DHS, Department officials understandably
were focused on preventing another major attack on the homeland;
however, from the outset, DHS faced significant challenges, including
consolidating 22 pre-existing component agencies, reporting to a
multitude of Congressional committees, and working diligently to strike
the balance between National security and protecting privacy and civil
liberties. Furthermore, a long-standing failure to adhere to strong
management practices led to high-profile failures, such as wasting a
billion dollars on the failed Secure Border Initiative Network (SBInet)
and mothballed ``puffer machines'' that eventually were pulled from
airports. Such mismanagement eroded public confidence in DHS and
continues to hinder it today.
DHS components, including Customs and Border Protection (CBP),
Transportation Security Administration (TSA), Coast Guard, Federal
Emergency Management Agency (FEMA) and others, continue to revert to
their practices used prior to joining DHS and often seek to fly under
the radar of headquarters oversight. More than 10 years after its
creation, DHS continues to face conflicting cultures and processes. In
addition, senior DHS officials often fail to hold components
accountable and lack the information necessary to make sound decisions.
Secretary Johnson has refocused DHS efforts to improve management
practices and increase interagency coordination; his ``Unity of
Effort'' initiative creates new processes to ensure that everyone's
driving towards common goals and objectives. For example, DHS's new
Joint Requirements Council seeks to ensure that components leverage
common technologies and platforms. Previous stovepipes led to
components buying different technologies to meet very similar
requirements; examples include CBP and Coast Guard air and marine
assets and component tactical radio systems. Because these efforts are
so recent, we're unclear as to whether the new processes will transform
how DHS manages its programs or simply add another layer to an already
massive bureaucracy.
Private-sector companies respect the value of using sound
management practices. Commercial firms often must deal with mergers,
acquisitions, and restructuring. Having started and managed a small
business in Pennsylvania, I understand the importance of sound planning
combined with strong, capable leadership and accountability. For
example, before undertaking a major project, commercial firms must have
a sound business case to ensure the project is viable. A sound business
case is critical to mitigating risk and ensures that managers have
sufficient knowledge as the project moves forward.
Because the private sector is focused on getting a return on its
investment, commercial firms would be much more cautious about risking
projects with cost overruns and schedule delays. In contrast, DHS all
too often has ignored risks and moved forward with unachievable
programs leading to wasted taxpayer dollars and late, costly, and
unimpressive results. DHS has much to learn from private-sector best
practices.
The private sector also routinely analyzes its overhead to
streamline and maximize efficiencies. DHS, however, struggles to
streamline its information technology programs, modernize its financial
systems, and consolidate its real property inventory, which result in a
significant inability to cut waste. For example, two inspector general
reports from last month found that DHS has done a poor job of tracking
costs related to its warehouse inventory and conference spending.
According to the IG, CBP could put $1 million to better use if it
improved warehouse management; this might not seem like much to
Washington bureaucrats, but my constituents in Pennsylvania would much
prefer that money spent towards securing the border.
DHS must learn from the proven techniques and practices of
successful commercial firms. Federal bureaucrats need to remember that
the American people are their shareholders; their tax dollars must be
safeguarded, not wasted. As the Nation faces significant homeland
security threats and our National debt continues to climb, we can
afford no more mismanagement. I look forward to the testimony and
recommendations from our witnesses to improve the management of DHS.
Mr. Perry. I look forward to the testimony and
recommendations from our witnesses to improve the management of
DHS. The Chair now recognizes the Ranking Minority Member of
the subcommittee, the gentlelady from New Jersey, Ms. Watson
Coleman, for her statement.
Mrs. Watson Coleman. Thank you very much, Mr. Chairman. I
would like to request unanimous consent to introduce a
statement into the hearing record. The statement comes from
Daniel Gerstein of the RAND Corporation. Following his service
as an officer in the United States Army, Dr. Gerstein served as
DHS deputy under secretary for science and technology from
August 2001 to April 2014.
Mr. Perry. So ordered.
[The information follows:]
Statement of Daniel M. Gerstein,\1\ The RAND Corporation
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\1\ The opinions and conclusions expressed in this testimony are
the author's alone and should not be interpreted as representing those
of RAND or any of the sponsors of its research. This product is part of
the RAND Corporation testimony series. RAND testimonies record
testimony presented by RAND associates to Federal, State, or local
legislative committees; Government-appointed commissions and panels;
and private review and oversight bodies. The RAND Corporation is a non-
profit research organization providing objective analysis and effective
solutions that address the challenges facing the public and private
sectors around the world. RAND's publications do not necessarily
reflect the opinions of its research clients and sponsors.
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Making DHS More Efficient: Industry Recommendations to Improve Homeland
Security \2\
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\2\ This testimony is available for free download at http://
www.rand.org/pubs/testimonies/CT438.html.
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September 18, 2015
introduction
Chairman Perry, Ranking Member Coleman, and distinguished Members
of the subcommittee, thank you for the opportunity to provide a written
statement for your subcommittee hearing titled ``Making DHS More
Efficient: Industry Recommendations to Improve Homeland Security.''\3\
This is an extraordinarily important topic and I applaud the
subcommittee's willingness to examine this timely issue.
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\3\ The focus of my remarks today will be on improving the
interface between the Department of Homeland Security (DHS) and
industry. Therefore, I do not intend to address relationships between
the Department and Federally-funded research and development centers
(FFRDCs), such as the organization I represent, the RAND Corporation.
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The hearing comes at a critical juncture, as we are witnessing
dramatic continued shifts in where research and development (R&D)--
important precursors for any successful acquisition--are being done. A
higher percentage of the R&D is being both funded and conducted by
industry rather than by the Federal Government (Figure 1). More R&D is
being done outside of the United States (Figure 2). The net result is
that less R&D as an overall percentage is being done within U.S.
Government laboratories or with U.S. Government funding. This implies
that the Government, to include DHS, must become more adept at building
partnerships across the security and defense mission space that allow
for the sharing of technology. It further implies that the Government
will not be the driver to technological advancement in the way that it
once was.
At the same time, some evidence exists suggesting that many of the
highly innovative companies are reticent to do business with the
Government because of a Federal Acquisition Regulation (FAR) system
that is opaque, is difficult to navigate, and places significant
demands on industry partners. More on this will be addressed below. To
ensure that the Government and DHS are able to meet the current demands
for research, development, and acquisition (to include services), a
vigorous and continuous dialogue must be developed in which DHS
requirements are clearly articulated.
Industry also plays an important role in this dialogue. For
example, sharing the results of internal research and development
(IRAD) must occur on a regular basis. This will require new models for
exchanging information with the Government, while protecting sensitive
proprietary information. It will also likely require either a revision
to or a more enlightened view of the application of the FAR.
My remarks this morning will focus on three critical areas: (1)
Examining the tools that are available to the Department for working
with industry, (2) discussing the importance of the Department being
able to clearly articulate requirements, and (3) identifying innovative
approaches for improving interactions with industry.
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tools available to the department for working with industry
DHS relies heavily on a variety of external sources for its
research, development, and acquisition. Industry is one of these key
external sources of partnership and collaboration.
FFRDCs, which include the Department of Energy Laboratories, and
academic institutions, such as the DHS Centers of Excellence (CoEs),
provide a majority of the basic and applied research that supports the
Department's needs. These organizations also provide some of the
development that occurs in the pre-acquisition stages. The efforts of
the FFRDCs and CoEs are augmented through several internal DHS labs,
interagency associates, and international partners. The Science and
Technology Directorate (S&T) is responsible for conducting and
monitoring basic and applied research for DHS. Additionally, the
Domestic Nuclear Detection Office and the U.S. Coast Guard, through its
R&D Center, also sponsor basic and applied R&D activities.
However, a majority of the support for developmental activities and
acquisition programs that occur in the Department is provided by
industry partners. DHS spending in these areas is difficult to
accurately measure as spending--particularly for development because it
can include a wide variety of activities, from pre-acquisition to
exercises and industry days--and occurs across the Department and not
in any single organization. S&T is responsible for tracking the R&D
portion of spending across DHS, while the Under Secretary for
Management is responsible for managing large acquisition programs
within the Department.
In working to communicate with industry in the R&D stages of
activity, DHS has a number of formal and informal mechanisms available.
Formal mechanisms include traditional requests for proposals and
requests for information that are governed by the FAR. S&T also manages
the Broad Area Announcements and Small Business Innovative Research
programs that serve as important avenues for providing windows into the
Department for industry, as well as opportunities for the Department to
gain visibility into industry capabilities in targeted areas of
interest. The focus of both these programs is to attract small
companies with innovative ideas to interact with the Department.
During my tenure in S&T, we were also working to provide more
opportunities for industry to demonstrate their capabilities in
specific areas of interest. Operational experimentation demonstrations
provided industry a forum for demonstrating capabilities in areas
including command and control, big data, common operational pictures,
first responder technologies, and use of drones. The Department has
also instituted the use of prize authority to attempt to entice
industry partners to compete on challenging R&D requirements. Industry
days are another mechanism by which a two-way dialogue with industry
can occur. These were done both in-person and by video teleconferencing
to bring in industry partners.
The Support Anti-Terrorism by Fostering Effective Technologies
(SAFETY) Act continues to provide an outstanding channel of
communication that benefits both our Nation's homeland security overall
and the capabilities and technologies of the industry partners that
gain approval for special indemnification of their technologies in the
event of a designated terrorist attack.\4\
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\4\ See the SAFETY Act website, U.S. Department of Homeland
Security, undated. Retrieved from https://www.safetyact.gov/pages/
homepages/Home.do.
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This short synopsis demonstrates that tools do exist for
communicating with industry. However, impediments also exist that
create a challenging environment for industry to successfully navigate.
One source identifies that the large defense and security integrators
are divesting of their ``information and technical service lines''
because of concerns about ``revenue growth or profit potential.''\5\ In
another dire assessment of Silicon Valley's concerns with partnering
with the Department of Defense (DoD), author Loren Thompson lists
``five reasons why tech executives are likely to recoil in horror when
they realize what it means to work with today's Pentagon: (1) The
margins are lousy, (2) Intellectual property is at risk, (3) The
regulatory burden is stifling, (4) Bureaucrats don't trust market
forces, (5) The customer is a political system.''\6\ Couple this
assessment with the data in Figure 1, which highlight that industry,
not the Government, is driving R&D in several key areas based on market
forces and opportunities for higher rates of return. While this
assessment directly pertained to the DoD, these same forces exist for
DHS; in fact, they are even more pronounced, given the far smaller
footprint and available resources of DHS. The strong implication is
that the Government, in this case DHS, must become a more savvy, well-
informed, and uncomplicated partner.
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\5\ Thompson, Loren, ``Exodus: Big Defense Companies Are Exiting
Federal Services,'' Forbes, Washington, DC, August 4, 2015. Retrieved
from http://www.forbes.com/sites/lorenthompson/2015/08/04/exodus-
bigdefense-companies-are-exiting-federal-services/.
\6\ Thompson, Loren, ``Five Reasons Why Silicon Valley Won't
Partner with the Pentagon,'' Forbes, Washington, DC, April 27, 2015.
Retrieved from http://www.forbes.com/sites/lorenthompson/2015/04/27/
five-reasons-why-silicon-valley-wont-partner-with-the- pentagon/.
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importance of clearly articulating requirements
Identifying requirements and articulating them clearly to industry
is perhaps the single most important aspect inherent in developing a
more progressive dialogue between DHS and industry.
Industry continues to inquire about what DHS requires in such areas
as R&D, systems acquisition, and services support. Unfortunately, this
has been a complex issue, as it has been problematic to develop
actionable requirements that have enough specificity to guide
industry's efforts yet are not so specific as to constrain potential
innovation. The result can be seen clearly by examining several high-
profile acquisitions that were unsuccessful and for which the programs
had to be canceled. The most recent of these was the Biowatch Gen 3
environmental sampling system.
The difficulty in developing clear requirements was summed up in a
2012 Government Accountability Office (GAO) document, which identified
that of 71 major acquisitions at DHS, 43 had been identified as failing
and had allowed ``capabilities that the program was designed to provide
[to] change over time because of poorly defined, unapproved, and
shifting baseline performance requirements.''\7\ In fairness, this
shortfall has been recognized and efforts are under way to develop a
well-defined requirements generation process. This effort remains a
work in progress.
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\7\ GAO, Homeland Security: DHS Requires More Disciplined
Investment Management to Help Meet Mission Needs, Washington, DC, GAO-
12-833, September 18, 2012, pp. 10-11.
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Another GAO report highlighted one opportunity: ``The first, and
perhaps best, opportunity to reduce acquisition risk is in the planning
phase, when critical decisions are made that have significant
implications for the overall success of an acquisition.''\8\
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\8\ GAO, Department of Homeland Security: Assessments of Selected
Complex Acquisitions, Washington, DC, GAO-10-588SP, June 2010, p. 20.
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Bringing in industry early in the planning process can assist with
technical specifications and technology readiness assessments, which
are essential to successful acquisition programs.
A major element of the Unity of Effort initiative announced by DHS
Secretary Jeh Johnson upon his arrival in the Department concerned
developing operational requirements that would improve the DHS
acquisition system and result in greater effectiveness and efficiency
across the Department and within individual components.
The Unity of Effort initiative resulted in the standing up of a
Senior Leader Group (SLG), a Deputy's Management Action Group, (DMAG)
and a Joint Requirements Council (JRC). While the SLG and DMAG forums
are not solely to assist in developing Department and component
requirements, they are intended to have the requirements generation
piece as a core function. This should provide a greater link between
strategy and resourcing once these management activities are fully
implemented. Most recently, the Secretary has signed a memorandum
reinstating Integrated Process Teams (IPTs) for coordinating
requirements across mission areas. Further, the teams should provide a
systems approach to generating requirements, which has been lacking at
points in the Department's history. The IPTs should result in the
development of mission roadmaps that identify capabilities, time lines,
technologies, and acquisitions that are of interest to DHS and the
components. One source notes, ``These IPTs will be charged with
coordinating and prioritizing research and development across the
department in a number of areas, including aviation security,
biological threats, counterterrorism, border security, cybersecurity
and disaster resilience.''\9\ While these activities are appropriate
and necessary to address DHS management shortfalls, a cautionary note
is in order. Similar initiatives have been tried before but have not
fully taken hold. Additionally, with slightly over a year left in the
administration, institutionalizing these efforts will become even more
challenging.
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\9\ Homeland Security Today staff, ``DHS Initiates New Measure to
Unify Its R&D Activities,'' September 9, 2015. Retrieved from http://
www.hstoday.us/single-article/dhs-initiates-new-measure-to-unify-its-r-
dactivities/a0a9f01082879865da1ee7aa7957e23e.html.
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This body of activity under the Unity of Effort umbrella, if
successful, should provide greater focus on generating requirements
that result in a clear set of the capabilities that DHS is seeking. The
outputs of these forums, if shared with industry, would provide the
type of information that is critical to allowing industry to make
informed decisions about where to spend its IRAD dollars and where the
Department was planning for development capabilities and ultimately
intending to make acquisition decisions. Therefore, once the IPTs have
reached an appropriate maturity and documentation is available that
highlights capability gaps and approaches for operational solutions,
industry could--within the limits of operational security--be provided
access to this information. This would allay one of the major
complaints that industry has made regarding access to the R&D
requirements that S&T is pursuing and the component operational
requirements for potential acquisitions.
innovative approaches for improving interactions with industry
Improving interactions with industry is a necessity, not an option,
for assuring homeland security today and into the future. The changes
across the R&D global community will mandate that Government becomes
more nimble in working with industry. As a greater percentage of the
R&D is conducted by non-Governmental and international entities, a
corresponding change in how the Government acquires essential
capabilities will be required. The recent incorporation of prize
authority competitions is one example of an innovative approach that
has been employed elsewhere with positive results.
Five additional potentially innovative approaches for enhancing
DHS-industry collaboration are highlighted below.
Identifying Areas of Priority Effort
An important starting point will be for DHS to put research,
development, and even certain acquisitions into three discrete bins of
activity. The first bin would include those technologies and systems
for which the Department should rely on commercial-off-the-shelf
capabilities. This bin includes technologies for which industry is the
clear leader and the Government can benefit from the previous
developmental activities of industry. Examples could include commercial
software products that, with little or no modification, could meet
established operational requirements. The second bin would include
technologies for which industry is a leader, but the Government desires
to stimulate the market to produce a specialized capability that, upon
fielding, would be exclusively for the Government. An example would be
a low-light, long-distance camera for law enforcement purposes. For
such a system, the Government must become adept at monitoring the state
of the market and, at the appropriate point, providing seed money for
the specialized capability to be developed. The third bin includes
those areas where the Government will need to stimulate the market
because no commercial market is envisioned. An example is detection of
home-made explosives for Government applications. In such areas, the
Government should and must lead R&D efforts by stimulating and
incentivizing industry through investments.
In this binning construct, the nature of the technical workforce
must evolve. DHS will need personnel who are less scientists than
technologists. The distinction is that scientists would be conducting
the R&D while technologists would be identifying sources of technology,
assessing technology readiness levels to understand the maturity of the
technologies, and binning the efforts to understand where DHS resources
should be expended.
Systems Analysis
DHS must employ a systems approach for generating requirements and
fielding capabilities. The individual R&D and acquisitions are less
important than understanding how they fit together in coherent systems
designed to meet the operational requirements of the force. THE SLG-
DMAGJRC-IPT processes serve as important management forums in this
regard. Therefore, efforts must continue through these forums to focus
on identifying and supporting developmental capabilities that will
enhance the operational efficiency and effectiveness of the Department
and the homeland security enterprise. Such a systems analysis must
account for solving operational problems. A useful framework is the
DOTMLPF-P (Doctrine, Organizations, Training, Material, Leadership,
Personnel, Facilities--Policy) approach similar to that employed by
DoD. Such a framework provides recognition that not all shortfalls
require an acquisition program.
Understanding DHS Requirements
In the Homeland Security Act of 2002, S&T has the authority to
develop a consolidated listing of all R&D that is on-going in the
Department. This includes the R&D that S&T is doing in support of the
homeland security enterprise (i.e., the Department; components; State,
local, Tribal, and territorial governments; and first responders and
law enforcement) and individual component efforts. Having such a
consolidated view is essential to generating comprehensive
requirements, as well as developing capabilities that are operationally
effective and efficient. These consolidated capability requirements
could be shared with industry, again subject to security and
classification requirements.
Access to Industry Internal Research and Development
A significant frustration during my time leading S&T was how to
garner insights into the IRAD being done within industry. Here,
industry can take the lead offering opportunities that allow DHS
developers to see various technologies in simulated operational
environments. While the operational demonstrations described previously
were led and funded by the Government, industry could take the lead for
modest demonstrations that would bring together industry partners
focused on certain topic areas. Discussions between DHS and industry
organizations such as the Homeland Security and Defense Business
Council that Marc Pearl represents should take the lead in identifying
processes for sharing corporate IRAD with DHS leaders, technologists,
and the components. Undoubtedly, the nature of the IRAD will require
certain agreements so as not to jeopardize corporate proprietary
information.
Federal Acquisition Regulation (FAR) as an Impediment
Developing a more collaborative approach to DHS-industry relations
should entail a reexamination of the FAR. Today, the FAR is overly
conservative and prohibits many interactions that could be very useful
for both parties. Furthermore, many assert that the FAR hinders
innovation and lengthens response times for fielding essential security
capabilities. The Chief Technology Officer at Customs and Border
Protection, Wolfe Tombe, described the FAR's negative effect, stating,
``Now we go out with a request for proposals and we'll say what we
think we need, and I think a lot of times there are vendors who could
come back if the FAR allowed it, and [recommend better, more cost-
effective solutions]. The FAR needs to be redone so it enables that
kind of interaction. It's hard [for a vendor] to come back and say they
have a better idea.''\10\
---------------------------------------------------------------------------
\10\ Verton, Dan, ``Can the Federal Acquisition Process Support
Innovation?'' Fed Scoop, August 27, 2014. Retrieved from http://
fedscoop.com/really-needs-done-acquisition-reform/.
Tombe went on to say, ``It makes no sense to put out a contract for
three months' worth of work to build a mobile app and take 18 months to
get that award out the door.''\11\
---------------------------------------------------------------------------
\11\ Verton, 2014.
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In short, the rigidity of the Industrial Age FAR is colliding with
the requirements of an Information Age where speed and agility are of
greater value. Further, with a more youthful acquisition workforce,
accustomed in their private lives to real-time, ubiquitous
communications, such stifling administration is both a frustration and
a hindrance. As noted earlier, many companies, including in the
information technology and big data fields, are deciding not to engage
with the Government largely due to antiquated bureaucracy.
conclusions
The range of challenges facing the Department and homeland security
enterprise will continue to evolve and in many cases grow. Ensuring
that preparedness and response capabilities will keep pace necessitates
a vigorous and continuous dialogue with industry.
It is clear from the actions over the past 2 years that the
Department has recognized that a more robust engagement with industry
is essential to successfully executing the homeland security mission.
Such activity is cause for tempered optimism.
The optimism is tempered in the sense that other DHS reform efforts
that have also recognized the need for a more vigorous and continuous
dialogue with industry have not been successful. Despite promising
rhetoric, only modest progress has been made. A significant cause of
these failures has been the rapid turnover of personnel in DHS and the
failure to codify these changes through legislation.
In my judgment, many of the tools are in place to support more-
fruitful DHS-industry dialogue. It is a matter of properly employing
the available tools. Another important limiting factor for the
Department has been the inability to articulate actionable capability
gaps that could help industry better understand emerging requirements
in order to allow for directing their IRAD toward these gaps. Finally,
DHS should look to develop more-innovative approaches for improving
interactions with industry. The use of prize authority is one such
example. Another would be a more focused review of R&D efforts to
determine areas for investment versus areas where DHS will monitor the
technology and become an adopter of it.
I appreciate the opportunity to discuss recommendations for
improving the homeland security of our Nation.
Mrs. Watson Coleman. Thank you, Mr. Chairman. Mr. Chairman,
I appreciate this opportunity for the subcommittee to consider
the importance to our homeland security enterprise of an active
and broad partnership between DHS and the private sector.
Secretary Johnson observed earlier this year: ``Government
does not have all the answers or all the talent,'' emphasizing
his belief that responding to homeland security threats must be
a partnership between Government and the private sector.
I also thank the Chairman for scheduling this hearing as
the committee prepares to consider legislation to reauthorize
many elements of DHS operations, including headquarters
functions within the subcommittee's jurisdiction, among them
the Department's Private Sector Office.
Mr. Chairman, as this subcommittee saw during our last
hearing this past April on the Department's oversight of major
acquisition programs, one can scarcely overstate how much
communication between the Department and contractors with
respect to acquisition requirements can affect the cost and
performance delivered by multimillion-dollar programs for our
homeland security.
By creating the Joint Requirements Council in June 2014,
Secretary Johnson has taken steps to ensure that the Department
speaks to industry coherently about each set of program
requirements and to ensure that all requirements for
acquisitions across the Department reflect a consistent set of
priorities in terms of cost and capability. I appreciate your
continued interest, Mr. Chairman, in the JRC. I look forward to
working with you to review and enhance the JRC as the decision
making center for the Department's senior leaders.
I look forward to hearing testimony from Mr. Totonis and
Mr. Pearl. I appreciate the efforts of business leaders to
provide Homeland Security policymakers with the benefit of
their management experience. I also look forward to hearing
testimony from former Under Secretary Duke, whose career in the
defense acquisition workforce, in the Office of the Secretary
and DHS components and now as a consultant to private-sector
organizations, enriches her perspective on how Government
agencies and the private sector can communicate and collaborate
in the most constructive way.
I very much appreciate any thoughts witnesses might have
about the circumstances under which DHS might appropriately
implement recommendations from the private sector, whether in
terms of DHS adopting best practices used by the private-sector
firms to manage their businesses, or in terms of DHS promoting
and maintaining contacts, as allowed, with firms working to
provide goods and services employed by the Department's
operations.
In addition, I hope that the hearing will also provide an
opportunity for Members and witnesses to tell us about specific
instances of how private-sector recommendations have fared at
the Department. Particularly because of this subcommittee's
focus on management in the Department and the committee's
upcoming consideration of the reauthorization legislation, this
hearing affords members a chance to consider the importance of
agencies like DHS casting their net widely as they collect
recommendations from the private sector, making sure that DHS
and its components recognize the critical contributions of
small and other traditionally unrepresented businesses.
As noted in the 2010 report of the Interagency Task Force
on Federal Contracting Opportunities for Small Businesses,
small businesses are leaders in innovation and drivers of the
economy. Small businesses hold more patents than all the
Nation's universities and largest corporations combined and
create two-thirds of all private-sector jobs, employing half of
all working Americans. Studies of innovation have pointed to
several policy initiatives designed to foster contacts between
small firms and DHS, but which would benefit from renewed
emphasis and intention--such as the authority for private
public cooperative research and development agreements or small
businesses innovative research and business technology transfer
programs coordinated by SBA, but also operating through the
Department of Homeland Security Advanced Research Projects
Agency, certain DHS authorities under the provisions of the
Safety Act of 2002, et cetera.
I look forward to our witnesses sharing their views on how
these and other mechanisms might enhance opportunities for
small and underrepresented businesses to contribute to homeland
security and economic security. So, Mr. Chairman, even at a
time of wide-ranging threats and constrained resources,
cooperation between Government and the private sector remains a
critical resource for new thinking, efficiency, and enhanced
mission effectiveness.
I also believe that Congress should ensure that DHS's
reauthorization language makes sure that the Department
receives industry recommendations offering the greatest breadth
into its thinking and the greatest economic multipliers by
highlighting collaborative opportunities for small businesses.
With that, Mr. Chairman, I yield back the balance of my time.
Mr. Perry. The Chair thanks the gentlelady.
The Chair reminds other Members of the subcommittee that
opening statements may be submitted for the record.
[The statement of Ranking Member Thompson follows:]
Statement of Ranking Member Bennie G. Thompson
September 18, 2015
The Department of Homeland Security's mission is broad and all-
encompassing--from aviation security to border security, emergency
preparedness, cybersecurity, critical infrastructure protection, and
counterterrorism. As the Department moves forward, it must do so in an
efficient manner that makes wise use of human capital, technology, and
financial resources.
Given the past acquisition failures at the Department, it is
imperative that some best practices and new ideas be employed to ensure
that taxpayer dollars are not wasted. I appreciate Secretary Johnson's
push to improve the Department's acquisition and planning efforts
through his Unity of Effort initiative.
The private sector can also offer an example to DHS on how to
manage some of its business practices. The private sector's ideas
should be considered with an eye toward ensuring that homeland security
capabilities are not diminished. Private-sector goals--earning a
profit--and Government goals--providing services and protecting to the
public--are vastly different, yet interdependent.
In order to successful, effective channels of communication between
Government and the private sector are required, including engagement
with small and under-represented businesses. Small businesses are
leaders in innovation and drivers of the economy. They hold more
patents than all of the Nation's universities and largest corporations
combined, and create two-thirds of all private-sector jobs, employing
half of all working Americans.
I would appreciate hearing from witnesses how DHS can better engage
the innovation, efficiency, and competitiveness exemplified every day
in small and minority businesses. Also, I would appreciate hearing from
the witnesses how DHS can better engage its workforce. Surveyed
employees feel that there is a lack of diversity throughout the
components and they opine that promotion potential within the
Department is few and far between. DHS cannot achieve Unity of Effort
without buy-in from its employees. I want to hear what private sector
best practices can be used at the Department to improve its workforce.
Mr. Perry. We are pleased to have a distinguished panel of
witnesses before us today on this important topic. Let me
remind the witnesses that their entire written statement will
appear in the record. The Chair will introduce each of you
first and then recognize you for your testimony.
Mr. Marc Pearl is president and chief executive officer of
the Homeland Security and Defense Business Council. The council
is a non-partisan, non-profit industry organization that is
made up of large, mid-tier, and small companies that provide
homeland security and homeland defense technology and service
solutions to DHS and other clients. Mr. Pearl has led the
council since 2008. Welcome.
Mr. Harry Totonis is a board director with the Business
Executives for National Security or BENS. BENS is a non-
partisan, non-profit organization that supports the U.S.
Government by applying best business practice solutions to
National security problems. Mr. Totonis has had an extensive
private-sector career and has authored numerous articles on
business strategy, change management, and drivers of business
effectiveness.
The Honorable Elaine Duke is the former under secretary for
management at the Department of Homeland Security, a position
she held from 2008 until 2010. Prior to her employment as under
secretary, Ms. Duke served in a number of positions in the
Department, including deputy under secretary for management,
chief procurement officer, and deputy assistant administrator
for acquisitions at the Transportation Security Administration.
Thank you all very much for being here today. The Chair now
recognizes Mr. Pearl for your testimony. If you could, push the
button, make sure the mic is close to your mouth there. Thank
you, sir.
STATEMENT OF MARC A. PEARL, PRESIDENT AND CHIEF EXECUTIVE
OFFICER, HOMELAND SECURITY AND DEFENSE BUSINESS COUNCIL
Mr. Pearl. Chairman Perry, Ranking Member Watson Coleman,
and distinguished Members of committee, good to see you again,
former Chairman, Mr. Duncan, Ms. Torres, thank you for giving
the Homeland Security and Defense Business Council the
opportunity to testify and to provide our collective
perspective on creating greater efficiencies at DHS.
As the Chairman said, we represent the leading large, mid-
tier, and small businesses that provide homeland security
technology, products, and services solutions. From the
industry's point of view, more consistent Department-wide
processes and procedures are needed to improve internal
operation and for it to become a more efficiently-run
organization. In order to help procure mission critical
products and services in a timely and efficient manner, DHS
also needs consistent, on-going, and quality measures that
encourage industry-Government engagement and communications.
The council works closely with DHS officials and its
subject-matter experts to discuss ideas focused on the
implementation and innovation processes that could serve to
bridge the gap between Secretary Johnson's excellent policy
aspirations embedded in his Unity of Effort and actual program
operation. How we bridge that gap is something that we are
looking at.
While much progress has been made, as you said in your
statements, there is still a lot of work to do. I ask, as you
said, that my written testimony be entered into the record, but
please allow me to outline a few key internal and external
challenges that the council believes could help the Department
move closer to a unified vision and greater efficiency.
First, not enough has been done to consolidate and provide
common mission services across the DHS enterprise. There isn't
one centralized system, for example, that provides an
individual's complete immigration history. CBP, ICE, and USCIS
experience enormous challenges around the collection,
coordination, and use of immigration data. In contrast, the
Office of Biometric Identity Management is an excellent example
of how DHS can create a mission-oriented service for the entire
enterprise.
OBIM processes 320,000 biometric identification
transactions every day, providing services and information to
Federal, State, and local government. We encourage DHS to
continue to look for other opportunities to consolidate systems
that could serve enterprise-wide mission areas which, in turn,
will create cost savings and reduce duplicative efforts.
Second, the entry-on-duty clearance process at DHS has been
historically problematic, duplicative, expensive, time-
consuming, and frustrating both for the people at DHS and
industry. Components refuse to recognize that a background
investigation performed by one component can be recognized by
another component. This lack of security reciprocity creates
unnecessary and critical delays as to when a contractor can
begin work, thereby moving schedules, significantly delaying
the start of a project, and wasting taxpayer dollars.
Third, a critical element of any successful organization,
private or public, is a highly-motivated workforce that
embodies the core capabilities necessary to accomplish mission.
DHS must continue to invest in its workforce by examining
incentives for greater accountability and creating robust
training programs that help employees master the skills that
they need to succeed. We believe it should identify critical
skill sets needed across the Department and find areas where
cross-component training can be utilized.
Fourth, the Secretary's Unity of Effort approach aims to
improve coordination between headquarters and its components
and directorates. But challenges still exist within the
components themselves where they need a better set of processes
that encourage consistent and on-going connections between the
component's program department and its contracting offices.
With respect to the externalities of these issues, early
and on-going engagement with industry is a critical element
outlined in detail in my written testimony. Over the last few
years, many parts of the Department have taken enormous steps
to improve, expand, and deepen industry/Government
communication. These must continue. But significant
improvements can still be made in how the Department engages
with industry. For example, TSA's strategic capability
investment plan was an extremely helpful document issued last
year and could serve as a model for other components that want
to communicate a division's vision and plan for potential
investments going forward.
In closing, I cannot outline the efficiencies of DHS
without addressing the role and responsibility of Congress, Mr.
Chairman, in that equation. The duplication in Congressional
jurisdiction over DHS across numerous committees and
subcommittees continues to create, in and of itself, its own
inefficiencies. While DHS still has a lot of work to do to
improve its internal processes and procedures, an unpredictable
budget cycle has its own impact on efficiency.
We understand hard decisions surrounding the budget must be
made in today's fiscal environment. But we encourage Congress
to recognize the impact delayed funding has on the very
efficiencies that you are trying to encourage and address here
today.
Thank you for giving the council the opportunity to present
some observations on this vital topic. We look forward to
continuing our close working relationship with each of you and
your staff, as well as continuing to work with the Department
on common issues of mutual concern.
I am prepared to answer any questions that you might have.
Thank you.
[The prepared statement of Mr. Pearl follows:]
Prepared Statement of Marc A. Pearl
September 18, 2015
Chairman Perry, Ranking Member Watson Coleman, and distinguished
Members of the Oversight Subcommittee, I am Marc Pearl, and serve as
the president and CEO of the Homeland Security & Defense Business
Council (Council), a non-partisan, non-profit industry organization,
comprised of the leading large, mid-tier, and small companies who
provide the homeland security and homeland defense technology, product,
and service solutions to the Department of Homeland Security (DHS) and
other Government and commercial markets. Our members make up a huge
portion of the Homeland Security Industrial Base, and I thank you on
their behalf for giving us the opportunity to appear before you today
to provide our organization's collective perspectives on the issue of
creating greater efficiencies at DHS.
The private sector has provided our Government and commercial
market with homeland security and homeland defense specialized
services, technological innovation, and strategic thinking for
decades--long before the tragic events of September 11, 2001. However,
in the wake of what occurred just 14 years ago last Friday, it became
poignantly obvious to the administration and Congress that we needed to
establish better processes and an effective organization to anticipate,
prevent, respond to, and/or mitigate any terrorist act or nature's
potential for destruction. Since the formal creation of DHS in 2003,
industry has worked to support the Department in tackling the many
diverse threats facing our homeland.
Shortly after the formation of DHS, the Council was established for
the purpose of building strong relationships between Government and
industry so that we could work together on the many process issues and
acquisition reform questions through open dialogues between the senior
executives in industry and their counterparts at the Department.
Additionally, we have sought to establish forums to engage in ``safe''
conversations and roundtables between subject matter experts in both
the public and private sectors to address the challenges and obstacles
that get in the way of efficiencies and mission success. Our programs
and initiatives foster those relationships and facilitate an exchange
of information that inform both sectors on how policy and process might
be better implemented and communicated, as well as help address mission
challenges, and improve the management and organization of DHS. Our
mission is to bring both sides together in informal conversation to
gain a greater understanding of one another's perspectives and
processes to identify ways to improve the way we do business together.
It is generally recognized that DHS needs more consistent
Department-wide processes and procedures to improve internal operations
and become a more efficiently-run organization. DHS also needs measures
that support industry-Government dialogues that help ensure the
Government can effectively procure mission-critical product and service
solutions.
For that reason, the Council is encouraged by Secretary Johnson's
2014 Strengthening Departmental Unity of Effort that reestablished the
Joint Requirement Council (JRC), established a set of regional Joint
Task Forces, and created the Secretary's Leadership Council and
Deputy's Management Action Group. These, along with other initiatives,
aim (and I quote the Deputy Under Secretary of Management) ``to better
integrate the Department's people, organizational structures, and
operational capability'' that will in turn, create more efficiencies
and enable mission success. Supporting the unity efforts, Secretary
Johnson announced earlier this month, a new measure to unify the
Department's research and development, creating Integrated Product
Teams (IPTs) that will be charged with coordinating and prioritizing
research and development across the Department in a number of areas,
such as aviation security, biological threats, counterterrorism, border
security, cybersecurity and disaster resilience.
The Council and its members are invested in the Department's
success and its ability to create a more efficient and unified
organization. Our overall mission is to work with you in the Congress
and the Department's leaders to encourage on-going discussions and work
towards the implementation of programs and processes that will bridge
the gap between policy aspirations and program operations. We must all
work together to ensure that the Secretary's Unity of Effort becomes
more than the logo of his tenure, only to be replaced by the logo of
the next Secretary. We want it to become a foundational legacy of real
change, real consistencies, real reform, and real efficiencies.
While the aspirational policies of the Secretary's Unity of Effort
are critical steps in the right direction, we believe internal and
external challenges still exist that significantly impact the goal of
achieving a more efficient and unified Department. Much progress has
been made, but there is still a lot of work to do.
The Council's testimony today will focus on a few key challenges
that we believe, if continued to be addressed, will help the Department
move closer to a unified vision. Allow me to provide a few observations
on some of these critical internal and external areas that impact the
efficiencies at DHS.
the need to reduce duplication of common mission services
While progress has been made, there is still a significant need to
reduce duplication among the components' common mission services and
align financial management systems, for example. DHS' multiple
financial management systems make it difficult to look across
individual budgets to see the larger picture on where dollars are being
spent and produces an inability to capture where cost savings could be
made.
Additionally, little has been done to consolidate and provide
common mission services across the enterprise, though the JRC, we are
told, is looking into this area. CBP, ICE, and USCIS, for example,
experience challenges around the collection, coordination, and use of
immigration data. There isn't one centralized system that provides an
individual's complete immigration history. An operator at one component
must query multiple systems, and, as a result, we have a process that
is time-consuming, costly, and frustrating to the on-ground official,
from both an IT architecture and business process point of view.
In contrast, DHS's Office of Biometric Identify Management (OBIM)
exemplifies that the Department can, in fact, create a mission-oriented
service for the entire enterprise. OBIM processes approximately 320,000
biometric identification transactions per day, providing services and
information to Federal, State, and local governments. They provide the
technology for collecting and storing biometric data, analyze, update
the watch list, and ensure the integrity of the data for and with
numerous agencies, including CBP, DOJ, DOS, FEMA, ICE, TSA, USCG, and
USCIS.
We suggest that DHS look more vigorously at other opportunities for
consolidating systems that could service enterprise-wide mission areas,
which could create cost savings and reduce duplicative efforts.
lack of security reciprocity
The entry-on-duty clearance process at DHS has been problematic,
duplicative, expensive, time-consuming, and frustrating. DHS components
do not recognize a background investigation performed by another
component. This has created a barrier to entry for many contractors and
is particularly unnerving for those who do business with other National
security, critical infrastructure, law enforcement and financial
services agencies, where they don't have to jump through as many
multiple internal agency security clearance hoops as at DHS. When DHS
is hiring a contractor to work on a project, this process causes
unnecessary and critical delays as to when a contractor can begin work,
thereby moving schedules, significantly delaying the start of a
project, and wasting taxpayer money.
It is our understanding that almost 75% of the vetting requirements
are already shared across components regardless of the program; so
establishing a common vetting security clearance program is an area
where the Department and the private sector could find the mutual
benefits of streamlining.
the need to invest in the dhs workforce
While we all recognize the importance of and on-going focus on all
things related to cyber and IT, the underlying critical component of
any technology and/or product is a well-trained and highly-motivated
workforce that embodies the core capabilities necessary to accomplish
the mission. Quality training is always a good investment whether in
the public or the private sector; for it will inevitably lead to a more
successful outcome.
The DHS workforce is responsible for executing multiple missions
including cyber analysis, responding to disasters, and safeguarding our
ports of entry. With the variety of mission responsibility and skills
needed to perform, the Department must continue to invest in its
workforce by examining incentives for greater accountability and
creating robust training programs.
After working with and getting to know numerous Government
employees over my 3+ decades in DC, I would proffer that many--
particularly those who have and continue to work at DHS over the past
dozen years--tend to join the civil service for altruistic reasons and
are motivated to serve the public and protect our Nation. At the very
least, leadership can continue to remind their colleagues how important
and critical their mission services are to our Nation, and, as a
result, they will feel more job satisfaction and pride in their work.
The communicating of appreciation is something that is regularly done
at the most successful corporations, even amidst the frustration of
one's daily tasks.
DHS should also look at finding innovative incentives that support
career progression. One suggestion--something that is also done in the
private sector--would be to create special teams. Industry puts their
best and brightest on important projects--cross-department--and
Government could do the same. DHS could consider a pilot program with a
major acquisition filling a special team based on merit. Being part of
the special team becomes a reward and an incentive to want to be a part
of the agency's top projects.
Other incentives include career progression and proper workforce
training. Employees want to feel like they have an opportunity for
growth within their current job and the continued ability to refine
their skill-set and grow as a professional. And as part of this, DHS
should continue to adopt more robust and multi-disciplinary workforce-
training programs to help employees master the skills they need. On the
program management and acquisition side, this must include training on
how to work with industry.
A quality employee understands all aspects of the business and is
encouraged, at various points in his/her career, to acquire a better
understanding and knowledge of such things as the budget process,
mission needs and planning, as well as how those things are addressed
in other divisions.
Though it took many years even after the passage of Goldwater-
Nichols, DoD found the CO-COMMS approach--requiring flag officers to
take on cross and joint commands--to be a tremendous incentive for
morale and successful leadership. Perhaps DHS should be encouraged to
look at joint environment requirements for those moving up the ladder.
This would not only be a huge culture change, but also could break down
cultural silos and help to operationalize the Secretary's Unity of
Effort.
We were encouraged by and wish to point out that DHS FY2014-2018
Strategic Plan outlined a goal to find support systems for training,
exercising, and evaluating capabilities that cross components to ensure
the readiness of front-line operators and first responders. They also
describe their goal to strengthen the cyber ecosystem which includes
implementing human capital strategies that will help develop a skilled
cybersecurity professional. To achieve this, they plan to develop a
Department-wide human capital strategy, including enhanced Federal
training programs. The Council supports these efforts and believes DHS
should continue to find critical skill-sets needed across the
Department and find areas where cross-component training can be
utilized.
the need for better connections between the program & contracting
offices
The Secretary's Unity of Effort approach aims to improve
coordination between HQ and its components and directorates, but
challenges still exist within components. There needs to be a better
set of processes that encourage consistent and on-going connections
between the component program and contracting offices. Our members have
observed that the contracting offices have assumed the dominant role in
some cases, but both must be in sync and engaged together to ensure
that the right procurement strategy is in place so that the Government
can ensure they are receiving the best proposals from their industry
partners. A consistent, unified decision-making process across the
Department is reliant on strong connections within the components and
across components.
Some of the components, we have been told by many of our members,
have taken the proper steps towards communication and coordination of
effort. For example, USCIS has worked hard to coordinate its CIO's
vision throughout the programs and contracting shops, thereby leading
to consistent messaging to industry from both of the offices, and
creating more levels of certainty for the contractors.
Additionally, ICE's Homeland Security Investigations division has
demonstrated excellent integration and collaboration between the
contracting officers and the mission owners, thereby leading to
successful mission requirements in a timely manner and within budget.
improving engagement with industry
Beyond the challenges within DHS, the Council believes improvements
can still be made in how the Department engages with industry.
Effective engagement with industry has been and continues to be a
priority area of interest for the Council and our members. In 2014, at
the urging of the Under Secretary of Management, we developed a
``Framework for Government-Industry Engagement Through the Planning and
Execution of the Acquisition Process.'' Through this effort, our member
companies have worked closely with the DHS directorates and components
to identify critical points of communication, information sharing,
engagement, and/or dialogue, as well as the challenges and barriers to
communication, that can and should occur throughout the different
stages of the acquisition life cycle and process.
It is critical that Government and industry work together to
establish and maintain open and transparent two-way forums for
communication in advance of and throughout the acquisition process.
Early, frequent, and constructive communication between the Government
and industry is the foundation to the planning and execution of a
successful acquisition. Acquisitions begin at the point when agency
needs are established. Early engagement with industry is a critical
aspect of strategic planning, describing agency needs, developing an
overall acquisition strategy, and identifying the terms, conditions,
and practices appropriate for what is being acquired. It improves
market research, which results in a greater understanding of the
possible products, services, and technologies that exist to support the
Government's needs, as well as the costs, benefits, and limitations of
different procurement approaches. It allows the Government to define
their requirements clearly within the market environment, and develop
realistic expectations regarding risk, cost, schedule, and performance
management. When requirements are well-defined, industry can write
quality proposals and deliver solutions that address gaps in a timely
and cost effective manner.
For industry, the substance, frequency, and timing of communication
with Government is vital to determining how to allocate limited
resources and make informed, risk-based investment decisions. Because
the costs associated with getting to know a prospective Government
client, understanding their requirements, developing a technical
solution, selecting a team, and preparing a proposal are so high,
industry makes decisions on which opportunities to pursue long before a
solicitation is released. Bid decisions are often made based upon the
nature, detail, and specificity of information that is available in
advance of the opportunity. The more time and information that is
provided, the more that industry is likely to invest in and think
through different ways to meet the Government's needs.
When communication is absent, vague, infrequent, or untimely, it
increases the risk that industry will choose not to participate in a
solicitation or that it will not understand the Government's
requirements. Communication problems that occur early in the process
(e.g. not having well-defined requirements) increase the likelihood of
contract delays, cost over-runs, duplication of effort, and outcomes
that fail to meet the Government's expectations and mission needs.
Industry relies on information from the Government on their future
needs so that they have time to align their financial and personnel
resources towards meeting those needs. This allows early R&D and
ensures that needed solutions can be provided in a timely manner. The
more specific the Department's directorates and components can be, the
more industry will engage, which will produce better solutions and
overall mission success.
It is important to point out that throughout the last few years the
Department has taken many steps to improve industry engagement and
better, more transparent and open communication. Plans similar to TSA's
Transportation Security Strategic Capability Investment Plan are
helpful and we hope to see more documents published from other
components that communicate the agency's vision and plans for potential
investments.
In addition to the small group discussions we have held with DHS
arising out of the Framework, industry has enjoyed the opportunity to
participate in a variety of forums such as mock debriefing exercises
with industry and Government representatives. And all of the industry
groups are currently working in coordination with DHS' Office of the
Chief Procurement Officer to plan a Reverse Industry Day later this
fall, which is part of its Acquisition Innovations in Motion (AIiM)
series of industry engagement and acquisition initiatives. This will be
the first DHS-wide event held from the viewpoint of the contractors
informing Government program and contracting officials about the
process industry goes through to respond to a Government solicitation.
The Council looks forward to the event and believes that creating a
better understanding between the two parties will help create greater
efficiencies in the acquisition process.
Mr. Chairman, and Members of this subcommittee, in closing I cannot
attempt to briefly outline the need to address the efficiencies of DHS
without addressing the Role and Responsibility of Congress in that
equation.
I'm quite sure you are aware that the duplication in Congressional
jurisdiction over DHS across numerous committees and subcommittees
creates its own inefficiencies. I point this out, not because this
Oversight Subcommittee will be able to change that equation, but simply
to provide an additional observation to outside factors impacting
agency efficiencies.
Additionally, while DHS still has much work to do to improve its
processes and procedures that will and must lead to a more efficient
organization, an unpredictable budget cycle has significantly impacted
its ability to achieve efficiencies in many areas. A stable,
predictable budget environment is critical to any government or any
company's ability to achieve its mission, and this is particularly true
to an agency as vital, large, and complex as the Department of Homeland
Security. Its mission areas require long-term planning, as well as
substantial and timely investments in specialized technologies,
products, and services. And industry cannot, likewise, strategize,
invest, research and develop solutions when the needed programs spit-
and-start or experience delays simply because long-range planning is
impossible to do.
The execution of DHS operations results from a continuous cycle of
planning, programming, and budgeting activities. When you do not know
your budget, you cannot plan for the future, start new programs, or
hire and train staff. Budget uncertainties make strategic planning,
long-term investment planning, and acquisition planning extremely
difficult. Industry relies on these activities to determine how to
invest its resources and R&D dollars so that it can develop the
specialized capabilities that DHS needs. Delays in the acquisition
process create inefficient business practices, waste taxpayer money,
and prevent DHS from effectively procuring and delivering critical
supplies and services to employees in the field.
We understand hard decisions surrounding the budget must be made in
today's fiscal environment. Regardless of the amount of funding the
Department receives, it needs a stabilized budget planning cycle, and
the Council encourages Congress to recognize that delayed funding harms
the very efficiencies you are trying to encourage.
Thank you for providing the Homeland Security & Defense Business
Council with the opportunity to present some observations on this vital
topic. We look forward to continuing our close working relationship as
a trusted advisor to you and your staff, as well working with the
Department and its officials on the common areas of mutual concern.
Mr. Perry. Thank you, Mr. Pearl. I appreciate that.
The Chair now recognizes Mr. Totonis for your testimony.
Thank you, sir.
STATEMENT OF HARRY TOTONIS, BOARD DIRECTOR, BUSINESS EXECUTIVES
FOR NATIONAL SECURITY
Mr. Totonis. Thank you. Chairman Perry, Ranking Member
Watson Coleman, Members of the committee, my name is Harry
Totonis. I am honored to be here as a private citizen and a
member of the Business Executives for National Security.
I plan to address what actions the Department of Homeland
Security can undertake to improve management efficiency and
effectiveness. I will speak from my own knowledge and
experience, having worked in several industries, including
health care, financial services, and management consulting. My
perspectives will reflect how the private sector approaches
similar challenges. I would also like to recognize and
congratulate the many accomplishments that the Department of
Homeland Security has achieved since its inception 12 years
ago.
I also applaud Secretary Johnson's initiative to improve
the Homeland Security Department's cohesiveness and
effectiveness as outlined in his April 2014 memo, Strengthening
the Department's Unity of Effort. While significant progress
has been achieved, opportunities appear to exist for continued
improvement.
Here I am referencing the annual report issued on February
23, 2015, titled Major Management and Performance Challenges
Facing the Department of Homeland Security. One area
highlighted for improvement was in management integration and
effectiveness. As requested, my statement discusses actions
that DHS can pursue to strengthen and better integrate its
operations and management functions.
As I noted earlier, my recommendations are based on my
experience both as a senior managing partner at Booz Allen
Hamilton and a senior executive and CEO for private-sector
companies. As a consultant, I had the opportunity to help large
corporations address similar challenges. As a corporate
executive and CEO, I had the opportunity to implement what I
had previously recommended. The challenge that DHS faces is a
common one for private companies.
Based on my experience, there are five key elements that
need to be implemented to achieve effective management. One,
you need to have the appropriate leadership with the right set
of experience, values, and commitments. Based on what I read,
it appears that DHS satisfies that requirement.
No. 2, the organization's mission and objectives must be
clearly defined. Moreover, there must be alignment across the
organization that spans from the board of directors to
executive management, across mid-level managers, and down to
all employees. In my experience, I have always strived for
every employee to know our company's mission and objectives and
for them to know where we stood relative to achieving that.
Getting this right not only creates better results, but
significantly improves employee morale. Based on what I read,
this may be a challenge for DHS.
Third, the organization must have an optimal organizational
structure that reflects the nature of these activities. I will
come back with more thoughts on this in a moment.
Four, the organization must deploy systems to measure its
performance. Moreover, these systems must be real time in order
for people to know where the organization stands. Again, based
on what I read, there appears to be a challenge for DHS in this
area.
Finally, the organization's reward systems must be aligned
with the mission and objectives. All of the above need to be in
place in order for an integrated management function to work
well. The benefits from getting this right are both significant
and many. Efficiency and effectiveness improves significantly.
Redundancy is reduced. Scarce resources are deployed in
priority areas. Scale economies are achieved. Challenges are
identified. Moreover, ensuring that this is put in place
ensures the employee morale improves because individuals feel
empowered and are prepared to help the organization achieve its
objectives.
I would also like to return and address the organizational
structure. There are three types of organizational structures
that are usually employed, decentralized, centralized, and an
organization that has a strong shared-services function. I
believe, given that DHS includes 22 diverse agencies, there
must be an organizational structure that is more decentralized
with a strong shared-services organization.
By ``strong shared-services organization'', I include
things like strategic planning mission definition and policy
setting, management development, reward setting, reporting
systems, process improvement, finance and accounting,
purchasing of property management. I underscore that the
shared-services function should help improve the overall
Department's efficiency and not create degradation of service,
frustration, and bureaucracy.
Finally, given the diversity that exists within DHS, I need
to note that attempting to centralize additional functions
beyond what I described, based on my experience, it has the
potential of increasing costs, degrading service, and adversely
impacting morale.
Thank you for the invitation to testify. I am prepared to
answer any questions you might have.
[The prepared statement of Mr. Totonis follows:]
Prepared Statement of Harry Totonis
September 18, 2015
Chairman Perry, Ranking Member Coleman, Members of the committee,
my name is Harry Totonis. I am honored to be here as a private citizen
and a member of Business Executives for National Security (BENS). I
plan to address what actions the Department of Homeland Security can
undertake to improve management effectiveness and efficiency. I will
speak from my own knowledge and experience having worked in several
industries, including health care, financial services, technology, and
management consulting. My perspectives will reflect how the private
sector approaches similar challenges.
I am also a member of Business Executives for National Security, a
non-partisan organization of business executives concerned about
National security. Although reflective of BENS' perspectives on what
the private sector can contribute to better managing our National
security organizations, the views I express are my own.
I would also like to recognize and congratulate the many
accomplishments that the Department of Homeland Security (DHS) has
achieved since its inception 12 years ago across many areas including,
overall integration, acquisition management, information technology
management, financial management, and human capital management. I would
also like to note that I applaud Secretary Johnson's initiative to
improve Departmental cohesiveness and effectiveness as outlined in his
April 2014 memo, ``Strengthening Departmental Unity of Effort.''
While significant progress has been achieved, opportunities appear
to exist for continued improvement. Here I am referencing the annual
report issued on February 23, 2015 and titled Major Management and
Performance Challenges Facing the Department of Homeland Security, OIG-
15-09. One area highlighted for improvement was in Operations and
Management Integration.
As requested, my statement discusses actions that DHS can pursue to
strengthen and better integrate its operations management functions. As
noted earlier my recommendations are based on my experiences both as a
senior managing partner at Booz Allen & Hamilton and senior executive
and CEO for private-sector companies. As a consultant I had the
opportunity to help large corporations address similar challenges. As a
corporate executive and CEO I had the opportunity to implement what I
had previously recommended.
The challenge that DHS faces is common among private-sector
companies. Based on my experience there are five key elements that need
to be implemented to achieve effective management:
1. The appropriate leadership with the right set of experiences,
values, and commitment must be place. Based on what I read it
appears that DHS satisfies this requirement.
2. The organization's mission and objectives must be clearly
defined. Moreover, there must be alignment across the
organization that spans from the board of directors and
executive management across mid-level managers and down to all
employees. In my experience, I have always strived for every
employee to know our company's mission and objectives and to
know where we stood relative to achieving them. Getting this
right allows not only better results but significantly improved
employee morale. I am not certain where DHS stands on in this
area, but what I have read suggest that employee morale is a
challenge. As a result I would presume that more work is
required here.
3. The organization must have an optimal organization structure
given the nature of its activities. I will come back with more
comments on this topic in a moment.
4. The organization must deploy systems to measure its performance.
Moreover, these systems must be as real-time as possible. Again
based on what I have read, this appears to be a challenge area
for DHS.
5. Finally the organization's rewards system must be aligned with
the mission and objectives.
All of the above need to be in place in order for an integrated
management function to work well. The benefits from getting this right
are both significant and many. Efficiency and effectiveness improves
significantly. Redundancy is reduced. Scarce resources are deployed in
priority areas. Scale economies are achieved. Challenges are quickly
identified and addressed. Executive management spends less time
debating, creating plans or responding to remedial actions as a result
of audits. Instead they have more time to execute. Finally, I have
found that the organization's employee morale significantly improves as
a result of empowerment, involvement and better understanding on how
they can contribute to achieving the organization's mission and
objectives. With high employee morale along with the other above items
an organization achieves on-going improvement capability that ``feeds
upon itself''.
As I outlined earlier, I would like to repeat myself and note that
the most progress in organizational and management efficiency is
achieved when all of the five above conditions are aligned with each
other and implemented. For example, if the systems are not in place to
measure performance (No. 4) it is hard to execute on the No. 2 and No.
5 objectives.
I would like to return to my list of 5 items and further clarify
the need for an optimal organization structure. Broadly there are three
type of organizational structures:
A fully integrated organization;
A fully decentralized organization;
An organization with decentralized line activities supported
by a strong shared services function or organization.
Given that DHS includes 22 diverse agencies--the U.S. Customs
Service, Immigration and Naturalization Service, Transportation
Security Administration, FEMA, U.S. Coast Guard, U.S. Secret Service,
Energy Security and Assurance Program, and many others--a decentralized
organization with a strong shared-services function is most likely the
appropriate organization structure. That implies that each agency
should operate fairly autonomously with DHS providing leadership,
direction and create value through a Shared-Services Organization.
If a company creates a common product with similar processes and
customers, then a push to consolidate into one similar entity would be
a productive approach. If, however, different companies are creating
different products through different processes for different customers,
a push to consolidate may be counterproductive. Instead, these
companies should be able to retain their unique capabilities and
identities, but share common services to drive productivity and
effectiveness.
A shared-services organizational approach for DHS would include
only the activities that are common or shared among the different
agencies and are important to effectiveness and efficiency of the
overall organization. For an organization as diverse as DHS, they would
typically include the following functions:
Strategic Planning, Mission Definition, and Policy setting
Management Development and Promotion
Reward-setting and compensation
Goals, Objectives, and Budgeting
Reporting Systems
Process Improvement and Innovation
Finance and Accounting
Purchasing
Real Property Management, which would strengthen efficiency
and reduce costs through reduced administrative overhead.
I underscore typically include because a Shared-Services function
should include responsibilities that only improve overall effectives
and efficiency of the entire entity while avoiding creating degradation
of service, operating frustrations, and increased bureaucracy within
the agencies. Given the diverse nature of DHS in suggesting the above
functions I tended to focus on leadership, policy, direction-setting,
and measurement functions as opposed to day-to-day operating functions.
The two exceptions may be purchasing and process improvement and
innovation.
Successful shared-services organization include a process
improvement team that works with all the agencies on important and
focused areas. For example, General Electric and other corporations
created six sigma teams that worked with all the GE businesses to
achieve operations improvement. To ensure success this team needs to
have teeth relative to implementing their findings, funding, and it
cannot be optional for an agency to implementing their findings.
Finally given the diversity that exists within DHS, I need to note
that based on my experience, attempting to centralize additional
functions, beyond what is described above, it only has the potential of
increasing costs, degrading service, and adversely impacting morale.
I recognize, as other members of BENS have previously testified
before this committee, that the management improvement plate is bigger
and the opportunities far broader to set the Department on the path to
greater effectiveness and efficiency. Certainly 12 years' worth of data
should be sufficient to give a basic sense of where the frictions and
the dependencies lie.
In appearing before you today my intent is to present a private-
sector perspective that will, hopefully, assist the committee in
becoming a better board of directors for DHS. I am confident that with
the help of this committee the Department can, in the face a certain
resource restraints in the coming years, commit to operational changes
in its overhead and infrastructure functions that can put it in the
company of the best-managed organizations--public or private--in the
Nation.
Thank you for the invitation to testify. I am prepared to answer
any questions you might have.
Mr. Perry. Thank you, Mr. Totonis.
Mr. Perry. The Chair now recognizes Ms. Duke for her
testimony.
STATEMENT OF ELAINE C. DUKE, PRINCIPAL, ELAINE DUKE &
ASSOCIATES, LLC
Ms. Duke. Good morning, Chairman Perry, Ranking Member
Watson Coleman, and Members of the subcommittee. I am pleased
to be here today.
I am testifying both from my experience as a civil servant
of 28 years, including the final 8 at the Transportation
Security Administration and DHS, but also combining my
experience in working with industry since I retired about 5
years ago. I would like to highlight some areas that fall under
the DHS current leadership's initiatives that, as they work
towards them, I think will greatly improve the efficiency of
DHS.
I would like to recognize the challenges they have. It is a
complex organization and they are in the process of trying to
not only fix inherited legacy systems but also transition to
the heightened security risk and the heightened state of
terrorism for the United States and also operating at the same
time.
So, first, I would like to talk a little bit about the
outward face of acquisition. There are specific things that can
be done to help industry support DHS in meeting its mission
more effectively. One is a socio-economic strategy that is
planned. DHS does reach its goals. It has consistently gotten
an A in its small business strategy. However, small businesses
and DHS mission can benefit from a more planned strategy for
engaging small businesses, so that the small businesses not
only have work and DHS not only meets its goals, but in a very
effective way for growing these small businesses and giving
them work where they are maturing to large, successful
businesses, not just managing a partnership of other large
businesses.
So a planned strategy and really strategically looking at
how we can grow our economy and our small bridges structure.
This also helps large businesses because if it is communicated
early to them what is targeted for small businesses and what is
not, it allows large businesses to more effectively plan what
opportunities it may partner with DHS on.
The second one I would like to talk about is market
research. By DHS better letting industry know early about its
operational requirements, the industry can target its
investments, its independent research dollars to better
position itself for supporting DHS in meeting its mission. This
better investment will reduce technology risk. It will improve
schedule. It drives down contract costs and shortens schedules.
One thing we have to keep in mind is if businesses operate
inefficiently, then the Federal Government through its taxpayer
dollars ends up paying those costs as allowable costs under the
contracting program. So we must have systems that allow
businesses to be more effective so that it drives down their
cost and drives down the Government's cost.
Another way we can do this is through published acquisition
schedules. We have to get better about communicating to
industry what is going to happen when; when things are delayed
so they can make more accurate hiring decisions, more accurate
planning decisions; and, again, drive down their overhead costs
so the Government doesn't end up having to absorb those costs
in paying for contracts.
Another area is good source selection. Very clearly stating
the requirements, what is important to the Government in terms
of best value, what does the Government want in terms of
requirements, and then clearly evaluating and awarding
contracts that are aligned with those proposals, this allows
industry to best propose the optimum solution for that specific
Government set and really helps both industry operate more
effectively, but also for DHS to receive exactly what it wants
and needs to deliver its mission. This is the best price and
the most efficient performance of the contract requirements.
To do this, DHS needs a strong workforce. We all know the
challenges DHS has had with morale and recruiting, hiring
retention. Some specific steps they could take to improve this
is look at DHS civilian joint duty assignments, to both
increase understanding but also increase morale and more the
jointness of mission. Exercising their personnel flexibility
and preparing the workforce for Presidential transition both
from an administrative and operational succession planning
standpoint, developing a workforce plan that will carry them
not only now but through transition and into the future.
I would like to also address the Joint Requirements Council
and the Secretary's Unity of Effort. This is essential for
going forward. Some of the building blocks of management are
built. They need to be cross-integrated. The Unity of Effort
will do this, implemented. Especially uniting the leadership
through the two leadership bodies, the Senior Leadership
Council and the Deputies' Management Action Group to drive that
board of directors that Mr. Totonis mentioned.
I look forward to talking with you and answering your
questions. Thank you.
[The prepared statement of Ms. Duke follows:]
Prepared Statement of Elaine C. Duke
September 18, 2015
Chairman Perry, Ranking Member Watson Coleman, and Members of the
subcommittee. Thank you for allowing me to testify today. Efficiency is
a great goal, one that is never completely accomplished, yet one that
can have great impact on mission delivery as incremental steps are
made. As DHS matures in its business and mission, it is important that
it continues to examine critical areas for continued efficiency.
I served our country as a civil servant for 28 years, including the
final 8 at Transportation Security Administration and Department of
Homeland Security headquarters, retiring as the under secretary for
management. As a civil servant, I understood the importance of
continued efficiency to deliver the mission effectively and execute our
fiduciary responsibility with taxpayer dollars. As a retired Federal
employee, I continue supporting DHS in its efforts to be a more
efficient Department. DHS is taking initiative to improve its
efficiency, and I will highlight in my testimony the some of those
areas that I believe most critical.
Acquisition is a major area to address in DHS' effort to continue
becoming more efficient. In acquisition, actions to increase efficiency
in the Department of Homeland Security (DHS) often result in parallel
efficiencies in industry. This allows industry to propose the best
mission solutions at the best price. Some areas that DHS can continue
to improve on include better communications overall, but specifically
in the following areas:
1. Socioeconomic Strategy.--DHS and its support industry could
benefit from a planned strategy to meet its small business
goals. A well-planned strategy will ensure that the right
contracts are set aside for small business participation,
helping small businesses obtain contracts that will benefit
them more in their growth, rather than just managing a
subcontractor team. Planning will also help businesses prepare
for upcoming new requirements and recompetitions. Early, clear
communication about the strategy will help small businesses
target their very scarce proposal resources toward
opportunities with the highest win probability. And those same
early, clear communications will help large businesses make
decisions and avoid investments in preparing for acquisitions
that will be set aside for small business.
2. Market Research.--DHS can enhance improve acquisition efficiency
by conducting more market research earlier in the acquisition
process. When industry knows what requirements may be coming in
the future, and knows what the DHS mission priorities are,
industry can best allocate its investment dollars to build
capabilities to meet DHS needs. Better investment reduces both
technology and performance risk, and drives down contract cost
and shortens schedule.
3. Published Acquisition Schedules.--DHS should more routinely
publish schedules with dates for acquisition programs and
contracts, and update those schedules regularly. Usually
synopsis notices and draft or final request for proposals are
posted in Federal Business Opportunities. When industry sees
those dates, it begins assembling and mobilizing proposal
teams. It also begins hiring key personnel. Often those dates
slip and aren't updated. That forces industry to make decisions
about holding teams, or dismissing them. That increases
overhead, which in turn increases the labor rate Government
pays for its services. Better communications will provide
critical information for industry to act efficiently in
supporting DHS.
4. Good Source Selection.--Requests for proposals and quotations
must be clear and accurate in both the requirements and the
source selection plan. The solicitation document must clearly
State what the requirement is, especially in a fixed-price
contract. Without that, there is increased risk on the
contractor, and industry must reflect that risk in higher
prices. That is especially true on fixed-price contracts.
Additionally, the solicitation document must clearly state how
the proposal will be evaluated and rate according to the stated
criteria. When the proposal states that technical is much more
important than price, and that innovation is desired, industry
will design its proposal around that criteria. Yet often award
is to the lowest price offertory due to budget and other
concerns. If that is the case, the solicitation should align
with the strategy and accurately inform industry so it can
accurately structure its proposal. And that results in the best
price and efficient performance of the contract requirements.
Effective and efficient mission delivery requires a good DHS
workforce. A critical area for continued efficiency is workforce
management. This includes recruitment, hiring, and retention. DHS would
benefit from focused efforts improve the DHS workforce and therefore
improve mission efficiency. Some initiatives to drive efficiency
include:
1. Make better use special personnel flexibilities for recruiting,
hiring, and retaining critical talent, including members of the
acquisition, intelligence, and cyber workforce.--DHS has the
authority to establish ``Excepted Service'' for certain
components, and this help them more efficiently compete for and
retain critical employees. This is especially true in competing
for talent with DOD and the intelligence community, as well as
private industry.
2. Institute DHS Civilian Joint Duty assignments.--This will help
build a DHS senior workforce that will drive an integrated
mission and improve DHS efficiency. This concept was approved
by Secretary Johnson in June, and implementing it quickly would
be very beneficial to the workforce and result in joint mission
efficiencies.
3. Prepare the workforce for Presidential Transition.--This will
position DHS to efficiently delivery mission as the country and
Department transition to a new administration. Key steps that
DHS can take now include succession planning and operational
exercises.
4. Develop a Workplace Plan.--Elements of the plan should include:
a. Specific action and milestone for dealing with the lingering
employee morale issue
b. Workforce measures and analytics for key areas such as
morale, staffing levels, performance management
c. DHS Workforce of the Future modeling
d. Talent Management Strategy, including: Recruiting, staffing,
developing, performance management and retaining talent.
Along with workforce management, DHS must also address its security
clearance, suitability, and on-boarding processes for both its own and
contractor employees. The long lead times, duplicity between the
clearance and suitability processes, and lack of reciprocity between
DHS components is very costly both in terms of time and cost of
investigations. Additionally, it delays the time that employees can
report to work, further degrading the efficiency of offices waiting for
key staff and contractor support.
Another area where DHS can continue to improve its efficiencies is
through Secretary Johnson's Unity of Effort, especially the Joint
Requirements Council. This is important for several reasons. First, the
Senior Leadership Council (SLC) and Deputies Management Action Group
(DMAG) are setting the tone for the Department. That tone is one that
respects each operating component's individual mission areas, but also
drives integration and joint focus on the DHS mission set. Second, the
need to continue to make ``back office'' functions more efficient is an
imperative. DHS cannot sustain an expensive support structure and
effectively meet its current mission obligations. It must continue to
reduce overhead in key area such as duplicative information technology
systems, facilities and related support services, and acquisition,
operation, and sustainment of key DHS mission assets and systems.
Thank you for the opportunity to testify. I look forward to your
questions.
Mr. Perry. Thank you, Ms. Duke.
I guess it is my turn to ask questions. So without the
formality of it all, I am going to start with Mr. Pearl. There
is a whole a lot to digest in your testimony quickly. There are
some lists there, putting some concepts together and I realize
how complicated it is. You said something that I found
particularly interesting, Mr. Pearl, that Congress has a part
to play in this, right? Of all the things that we can affect or
not affect, it seems like that might be an obvious place for us
to start.
So with that, you said there are numerous committees of
oversight, requirements, and so on and so forth. I don't think
anybody here wants to be in the way, right? We are trying to
make things better. Can you give us some specific examples? Do
you have specific examples? I imagine you do. I am thinking you
do. But can you think of some specific examples for us, things
that we should be working on where we can actually affect this?
Mr. Pearl. Well, this is an issue that has been discussed
with Chairman King, with Chairman Thompson, with Chairman
McCaul, from the time that this was a select committee to the
time it became a permanent committee. Relinquishing territorial
imperative on the part of your colleagues in any Congress is
difficult.
I think it is estimated that over, about 108 committees and
subcommittees in the Senate and the House have, in essence,
attached jurisdiction to some aspects of the homeland security
enterprise agenda, quite rightfully so in certain areas where
it may be in transportation or energy with regard to water
supply or food safety when it is USDA. But sometimes that goes
beyond. There are ways in which those discussions with
leadership at least should take place in terms of how can we
consolidate.
Should every subcommittee of every non-jurisdictional
committee have, you know, be able to hold a hearing and call,
in essence, folks from the Hill, and I was on a number when
Elaine Duke was the under secretary and deputy, we were on
panels together and knew that she was testifying.
Every one at every level of DHS is always asked to testify.
That takes staff time to, in essence, prepare the testimony.
There isn't that sense of coordination and efficiency within
the Congress. What this committee overall can do to that is a
discussion that is beyond, you know, my pay grade and maybe
even of the subcommittee's responsibility. But this is an
oversight committee. Part of that comes with recommendations
and urging discussion.
So I would just simply say that it would behoove the
subcommittee to at least ask for the opportunity to have
discussions that could help consolidate to greater efficiencies
within a Department that, in and of itself, is pulled all over
this place with this unity, with whatever the common culture
that we are all trying to build is going to be preventing.
So I raise it not that this subcommittee is going to be
able to fix it, but raise it because I think it is worthwhile
for a discourse within the leadership of the United States
Congress.
Mr. Perry. I agree with you. But you certainly can
understand that since it affects these other jurisdictions,
that they feel in the duty of oversight that there is a nexus
there. However, I think it is probably important that we visit
and revisit the issue to make sure that we are being prudent in
what we do. It is not just for show. It is meaningful. It is
not wasting time and resources. So I think it is a great point
to make.
Mr. Pearl. I would only say, Mr. Chairman, that, and Mr.
Totonis from BENS and the Business Executives for National
Security have looked at this from a National security
standpoint, in terms of DOD, and how it has been able to have
more consolidation and not every committee and subcommittee in
the United States Congress can assert jurisdiction.
Mr. Perry. Right. So it can be done. But there has got to
be the will. I get that. I have questions for everybody but my
time is running out. So I am going to stick with you, Mr.
Pearl. We will see if there is second round.
When you talked about the separate agency processes and
that they each have their process. Of course, it is hard to
impose your will, so to speak, as the larger organization over
the smaller one. What is your recommendation, where is the cart
and where is the horse? Who is first and maybe one example of
that, like where do you start I guess is maybe the better way
to put the question?
Mr. Pearl. This is something that, in fact, Elaine Duke and
I have talked about continually, in terms of is there, in
essence, a common operating platform within research and
development? Is there a common operating platform with regard
to acquisition? If every single component can do its own
acquisition process without any, without anybody kind-of
overseeing it to coordinate it, if every single component can
do its own research and development without anyone from Science
and Technology Directorate to be able to kind of impose a sense
of coordination coming from the Secretary, then people are
going to do what they think is best.
This is not a nefarious approach. It is just that they
think their culture, their way of doing it is the best. I am
not saying the Coast Guard has it right all the time or that
Secret Service or FEMA or CBP or TSA has it right all the time.
But what we are saying is that part of the problem is, as I
pointed out, is there are some good things happening in various
components. There is, there seems to be if not a reluctance, at
least a challenge in trying to, in essence, take those models
of best practices in acquisition, in research and development,
in program planning, whatever it might be, and try to bridge
that to other components so that everyone can begin the process
of meeting what Secretary Johnson calls a Unity of Effort or
what, in fact, Secretary Ridge called, you know, a DHS 2.0 or
``One DHS'' of Secretary Napolitano.
We want to see these, as I said in my statement, more than
just become logos. We want to see the aspirations of a
Secretary become truly operational enterprise-wide.
Mr. Perry. It makes sense. It may be too big of a job for
one individual over the course of the tenure to get there. With
that in mind, it would be interesting from your perspective to
get a prioritization, if it is acquisition should be first, if
it is R&D, which one should be first? Then, you know, try and
look at the process for getting that. But that might be time
for another discussion or a continued discussion. I appreciate
your time.
Mr. Pearl. Thank you.
Mr. Perry. At this time, I am going to turn to the Ranking
Member, Ms. Watson Coleman.
Mrs. Watson Coleman. Thank you, Mr. Chairman. Thank you
very much for your testimony. It is really quite illuminating.
You kind-of connected the things and themes that we have heard
consistently.
I want to ask you, I have got a million questions too but I
am going to start--is everyone aware of the Secretary's Unity
of Effort and what that means and what he intends? Can you tell
me whether or not you think that Unity of Effort as it is
conceived, addresses the deficiencies that and the expectations
of a better outcome in the Department?
Can you just tell me yes or no, do you think it is
efficient? Do you think it is missing a mark anywhere? Because
I would like to start from there.
Mr. Pearl. Let me just say the following, in my testimony,
I say that we are, as an organization, very supportive of the
essence of the aspirations of the Unity of Effort and things as
has been discussed, the Joint Requirements Council, the DMAG,
the task forces, the Southern Border Campaign. Those are
important things.
But in the 18 months or less that we have left under this
particular administration at the Department of Homeland
Security, we want it to become a foundation, a legacy, so that
it doesn't, we don't just go to the next logo of the next
Secretary. So yes----
Mrs. Watson Coleman. That is where I am trying to go.
Mr. Pearl. It provides a foundation.
Mrs. Watson Coleman. We believe that this provides the
foundation, that it addresses the issues, and will help this
Department to operate more effectively, and efficiently and----
Mr. Pearl. It could.
Mrs. Watson Coleman. Okay.
Mr. Totonis. It is also a matter of execution. It sounds
great. It is the right mission. The devil is in the details,
you know, how do you take that and actually execute it?
Mrs. Watson Coleman. What I don't know is under this Unity
of Effort, are there like goals and time tables? Do we have any
indication whether or not the Secretary feels that certain
goals are being achieved within the time frames?
Ms. Duke. I do know that they have identified specific
groups for the Joint Requirements, the Secretary has chartered
five groups. I do not know if they have specific time tables. I
do know through the Senior Leadership Council and the Deputies'
Management Action Group they are tracking those and they are
meeting regularly. I think that is a huge step forward for the
leadership of DHS to be acting unified.
That is a change. But they have to do something and they
have to do it quickly. I think in terms of priorities, it
should be something in the infrastructure area, whether it is
facilities or IT.
Mrs. Watson Coleman. So is there something, taking on what
the Chairman said, is there something that we should be doing,
if we agree that this effort that is there, this vision that is
there, represents the sort-of best pathway for the Department
and its various components to move forward, is there something
that we should be doing now, thinking and doing right now to
ensure that we don't go off track into some different area when
the next President comes, that there is some continuity and
some building that takes place, just asking?
Mr. Pearl. Absolutely. I think that the nature of the
existence of an oversight committee and a management and
oversight subcommittee can go to, for example, the chief
procurement officer has a very important acquisition,
innovation in motion product right now. I hope that it has been
shared with members of your staff. That goal, that aspiration
should be reported back to you as to how, in essence, it is
moving forward.
What the Joint Requirements Council, the re-energization, I
mean, it was there before, Admiral Allen was the chairman of it
at the time years ago. It is now back in place. We would very
much like to see after a year or so what progress is being
made.
Industry is looking for that as well, Madam Watson Coleman.
We want to know what progress is being made and if Congress
through the Oversight Subcommittee can, in essence, get their
feet to the fire, we would very much appreciate it.
Mrs. Watson Coleman. I am going to want to know a few more
things as we move forward. One of the things that I want to
know right now is you said something about the vetting of
contractors.
If one element, one component vets a contractor, why isn't
that vetting appropriate for the other components that would
use the same contractor? My question is: Is that part of the
Unity of Effort?
Ms. Duke. It is part of the Unity of Effort. I know it has
got the attention of DHS leadership. I strongly think that is
one that can very much help. It has to do with clearance versus
suitability. Each component has its own suitability process.
They recognize the clearance. That is something that DHS can
work within itself.
Mrs. Watson Coleman. I yield back. Thank you.
Mr. Perry. The Chair thanks the gentlelady. The Chair now
recognizes the gentleman, Mr. Duncan, for questions.
Mr. Duncan. I thank the Chairman. Thanks for continuing the
work we started in the last Congress on this effort. It is
important that the agency really start adopting the best
management practices and best practices in general of the
private sector. They work in the private sector because they
work in the private sector.
One year ago, the Department of Homeland Security embarked
on Secretary Jeh Johnson's Unity of Effort which we have heard
about today. Something that I support. I mean, I think it is
the right, I supported it then, I support it now, I think the
right, at least, mindset of trying to bring this massive new
Government agency that is still in its infancy in a lot of
ways, relatively speaking, into a One DHS which I think Janet
Napolitano started but with the right mindset.
But it just can't seem to grab a foothold and actually take
off. The best-laid plans, and I think this is, I say it to
Secretary Johnson, I think it is the right mindset for managing
the agency that, look, we are One DHS, we are not 22 separate
components, we have got to start acting as One DHS, we have got
to start working together.
It comes to similar contracts, similar approaches to
outsourcing operations, and with the vendors. So I will say
this, in April 2015, the Center for Strategic and International
Studies' publication listed cultural resistance as one of three
overarching challenges to the Unity of Effort initiative. This
document stated there appears to be strong cultural resistance
to approaching homeland security in a cohesive, unified fashion
across the Department's components and office.
I have been here 4\1/2\ years. We have heard that over and
over and over. I was on the OME subcommittee before I chaired
it in the last Congress. I am back on it again. This is a
continual theme. You would think after 14 years since this
agency has been stood up or 12 years, whatever it is, that we
still wouldn't be having these challenges of the individual
components still holding onto their identity.
Because the Nation suffers, National security suffers when
we don't have that. I will ask Mr. Totonis, how would you
recommend the Department resolve the remaining cultural issues
with the consolidation of the 22 preexisting component
agencies? I mean how do we get to that One DHS mindset?
Mr. Totonis. Well, to stay on that point, from a public--as
a CEO of a company, if I faced the same set of issues, the way
I would approach it, if my board and my shareholders said the
Unity of Effort is the thing we need to execute, my
responsibility would be to execute it. So that means I would
communicate my goals and objectives throughout the organization
so everybody in the organization understands that this is the
issue.
If we did not make progress, I would make the changes in my
executive managers, as well as my mid-level managers, and bring
in the people that understand that this is mission No. 1.
Mr. Duncan. Let me just interject this, because we see a
lot of corporate takeovers but we see a lot of mergers. I think
this was both. This was a corporate takeover in the fact that
the committee in Congress, Congress in general said we are
going to bring all these agencies together into one big DHS
because we felt like at that time it was the right thing for
the Nation to have everyone talking to each other, to have them
working on the same page for the same goal and that is the
safety and security of the Nation. So that was a corporate
takeover.
But in a lot of ways it was also a merger because, by
golly, we are all Americans and we are all part of the American
Government that all have the same goal of securing the country.
So it is really a blend of corporate takeover and merger. It
happens every day in the world. Has DHS talked with the
companies that have been very successful in mergers and
takeovers to find out how do you bring these two, before the
merger, separate identities together to start riding for the
brand, the new brand?
Mr. Totonis. One other challenge, is that, if I think about
corporate mergers, in corporate mergers, you would never merge
organizations that are very different. One of the questions
that I have in my mind in bringing in the 22 different agencies
is there is so much diversity that it is hard to merge those
entities together.
Mr. Duncan. I don't disagree with you there. I mean,
American Airlines and US Air were both airlines, right?
Mr. Totonis. Right.
Mr. Duncan. It is just a matter of which cup you are going
to use, and which fuel you are going to use and which vendor, I
get some of that.
Mr. Totonis. Exactly.
Mr. Duncan. But the ultimate goal is the same for everybody
that merged into this, right, is the safety and security of the
company. You don't think so? Mr. Pearl, I will let you jump in.
If you don't think the safety and security of our Nation is the
same goal between 22 components, then we need to have a talk.
Mr. Pearl. No. No. That is an overarching goal. But when
you have the different cultures of what your responsibility
are, you have groups that are law enforcement organizations,
you have emergency management groups there, you have different
motivations for getting to that goal. Not every merger, Time-
Warner and AOL, even they may be in, ``communication,'' is
going to work out. The question becomes how do you get to a
joint common operating platform with the right people? That is
something that Elaine Duke and her predecessors and successors
through the management tried to do and continues to work on.
But there are so many exigencies, there are so many, in
essence, pushes and challenges that sometimes you stay in your
swim lane and you do what you have to do and it is very
difficult in the beltway of Washington to get there. We see it,
however, we see it going on on ground in Nogales, in Otay Mesa,
in the Pacific Northwest, in Miami, in the Keys, we see this
kind of coordination of all of the agencies and components
working together? That doesn't always translate to the policy
people.
Mr. Duncan. I agree with what you are saying. Mr. Chairman,
I would end with this, I know I am over my time. But when you
see those mergers like AOL and Time-Warner, whoever, what you
also see is strong leadership that sets a vision for that
merger and the ability of those less than senior management
officials and senior management to actually fire people that
aren't willing to ride for the brand, that are creating some of
that friction.
That is the problem with Government is it is not easy
enough to let people go that don't have the right mindset, that
are not doing the job. It is not just DHS, this is across the
State Department, all the other Government agencies. We don't
have the ability to fire people that need to be fired, right?
So, Mr. Chairman, I yield back. I thank you for the leniency.
Mr. Perry. The Chair thanks the gentleman from South
Carolina. The Chair now recognizes the gentlelady from
California, Ms. Torres.
Mrs. Torres. Thank you, Mr. Chairman. Good morning to the
three witnesses. Thank you for being here.
I want to go back to the statements of employee morale
because I specifically think that it is extremely important to
ensure that the people that are in charge of our security, you
know, are working under conditions that, No. 1, they are
receiving the proper training they need for their specific job
function. No. 2, their task is not simply to come here and
report to committee after committee after committee.
What has been the response, you know, from our committees
of jurisdiction, what has been the outcome of number of hours
that you have had to come here, prepare, and present report
after report? Have you seen anything come out of, from us, I
mean, what is our, what would be our grade level I would say,
how would you grade?
I know that I am putting you in a very difficult position.
But oversight is very important. But when you have to report
to, you know, 20-some committees, it takes a toll on employees.
It takes a toll on you and your work.
Ms. Duke. I would say that it was challenging. It is very
time-consuming. It is much easier to prepare for a hearing when
you are not going through the clearance process. I would say
two things that the Oversight Committee could do to help DHS in
its path that I believe is going in the right direction.
One is recognize the positive. I do think that some of the,
as they are called, bureaucrats, which to me is a positive
thing, they are serving their country as civil servants, have
been beaten down in a lot of ways. When good does happen,
whether it is jointness, whether it is service, for the
committee and the DHS leadership to recognize that.
Mrs. Torres. Can I interrupt you for 1 minute? With that
statement, I want you to address the OPM's 2014 Federal
Employee Viewpoint Survey that ranked--37 of our agencies had
the lowest morale ranking.
Ms. Duke. Right. I think it is three-fold. One is the DHS
mission isn't loved by everyone. It has the public interface
that my fellow witnesses talked about. The work is difficult.
There are a lot of American citizens that don't value the work.
I think, second, it is a 24/7 operation that is very
tiring. But most people, most of the civil servants that work
in DHS are passionate about serving their country. That is what
we have to build on. I think communication is key from the
Secretary on down and recognizing the positive. As we just
heard, dealing with the negative, dealing with people that
don't perform is very important.
But I think that recognizing, to try to offset some of the
negative of the mission of DHS would be hugely positive in
going forward. I think this committee, and I think working in a
bipartisan manner, as this committee does often, really helps.
I think that hearings, it is very difficult to actually move
forward. They are necessary but they don't really solve the
problems.
I think that this leadership is very willing to talk to the
committees. I found when I was a civil servant that when I
could meet with the staff or Members and really talk through
issues, that really was useful in moving things forward. So I
think the transparency of this leadership could really help the
committee in partnering with the Department and moving some key
things forward.
Mrs. Torres. What steps can DHS HQ and its components
undertake to ensure that its IT personnel is properly trained
and is ready to support the Department's new IT broker model?
Ms. Duke. I think that, No. 1, taking advantage of some of
the hiring flexibilities. It needs to have an existing
workforce that knows DHS. It needs to bring in some of the
cutting edge for both cyber and IT operations.
Mrs. Torres. Because we have two models, right, the old
legacy and the new, that we have to incorporate people that
have only been trained under this model?
Ms. Duke. Right. Right. I think that the blended workforce,
the old and the new, brings the best of both. Understanding the
specific nuances of operating an IT system in a Federal sector
with bringing in the new best practices for cyber protection
for agile-type deployment of IT upgrades, those type of things
can partner together.
Mrs. Torres. Thank you, Mr. Chairman. I yield back.
Mr. Perry. The Chair thanks the gentlelady. The Chair now
recognizes his good friend from Florida, Mr. Clawson.
Mr. Clawson. Thank you. Thank you for coming today.
So I have been coming for about a year. Let me give you a
bit of a summary of what I hear because bits and pieces of what
you all say we hear on the committees and subcommittees. There
is a morale issue, too many meetings and reviews like this, the
mission is not totally understood, financial data is generally
unavailable, unaudited, no audited financial data, no
operational data that I know of, but we need more money and
more capital. What planet am I living on? I am accustomed to a
minimum amount of data, not qualitative opinions.
I don't doubt what you all are saying at all. But I am now
at a year with no operational metrics, none. I am told that I
need to vote for more money and that is the way to keep the
country safe. Does that seem fair? Does that seem fair? Is that
fair to the taxpayer? We won't give you any data. You make us
come in here too much. If you don't give us the money, the
country is not safe.
The Secretary, Mr. Johnson, I have asked for the same
thing, just a little bit of data. So it feels that the
complaints about morale, lack of money, too many reviews, with
no data for us at all from the Department feels like a
diversion and unfair.
I don't mean to be partisan at all. I would love to know
what they are doing. What is the return on investment for the
taxpayer who is putting the money in the bucket? We want to
talk about morale, let's talk about morale for the taxpayer.
How are we doing with the money? It may be great. But how do I
know if all I get is opinions?
You used to work there. Mr. Pearl, you are very
experienced. I have been here a year now. I would love to see
some operational data. You said it is too decentralized. Well,
give me what you got. I don't want to make this a lecture. I
feel like I am wasting my time too. You feel like you're
wasting your time. I get to come to these meetings and get no
data.
I am in some alternative universe of billions of dollars
being spent and no data to protect the people giving us money.
Then we are going to talk about morale, not having enough. I
say morale is based on performance. That is a big input. If we
have no performance data, how do I know? How do I know? So what
do we do? You give me advice. What do we do at this level to
get some level of operational data so we know how people are
doing?
I like the whole idea of unified vision, unified purpose, a
bit of unified data so I can tell how the progress is going,
versus metrics, would be helpful. I just get so tired of coming
down here and never getting any hard data, not even audited
financial statements.
I'm sorry I went on so long. You all are no longer with the
agency. How do we get just a little bit of operational data so
we know how things really are as opposed to opinions and
qualitative stuff? Mr. Pearl? Ms. Duke? I'm sorry I am
emotional about it but it just feels, we are just getting the
same rut over and over.
Mr. Pearl. Mr. Clawson, let me just try to take a stab at
this in a small way. No. 1, there was nothing in my written
testimony, other than just we need to look at the question of
tamping down the budget and what that brings to strategy, with
whatever the dollars are. We did not ask for any more money. I
am not in a position I don't----
Mr. Clawson. I am not implying that you did.
Mr. Pearl. No. No. I understand.
Mr. Clawson. You understand, I get asked for money, and I
get no data back when I ask how we are doing. That is a weird
world.
Mr. Pearl. I get the same response from my children. You
know, what are you going to use it for? I don't mean to say
that facetiously.
I think the question is when we look at the work of this
subcommittee and the topic of this particular hearing, what we
are trying to address are issues separate and apart from where
the dollars are or how much dollars there are going to be. The
efforts on what the Secretary is trying to do and his
predecessors are trying to do is within these various cultures
that are different and diffuse and all over the place, how can
we begin the process of bringing a horizontal to these--some
people call them silos, some others call them cylinders of
excellence, to these components that exist? If we can begin to
do that within the budget framework that exists, I think you
will get there.
A year ago December, you know, in talking with Elaine
Duke's successor, Under Secretary Rafael Borras, there was a
clean audit that came through for the first time since the
Department--that did come through, and I urge you to look at
those, that as part of a first step. It is not--doesn't answer
every one of your questions.
In short, what this oversight subcommittee can do, what
industry organizations like ours are trying to do is work with
the Department to identify the things that are working; ask
for, as Ms. Duke said, the positives that are working and
various components, and let us try to, in essence, replicate
that across the entire enterprise. If we can begin to do that,
then you will get the answers----
Mr. Clawson. But how do we know what is working if we have
no data?
Mr. Pearl. Well, I----
Ms. Duke. I think, Mr. Clawson, that I would separate
employee morale and budget. I do think you need data, I
absolutely think that, and I think it is important both for DHS
and the oversight committees to operate on data.
Hopefully the left-hand side of Unity of Effort can
identify that, by identifying what mission sets they have, by
identifying the capability gaps and actually being able to come
through the appropriations process and show what they are
performing and what they need in terms of delivering the gaps
in that mission set. So that is imperative.
I don't think that is relevant on the morale issue, because
most civil servants don't--they come to it for the value of the
mission. I think that, especially at the junior grade, it is
not a budget issue; it is an issue of feeling that the work
they do is important and valued, and then the communication
comes down. So I think they are both important issues.
Mr. Clawson. I agree morale is important, of course, I do.
But I think in any organization, a scoreboard to see how you
are doing might have some sort of impact on morale either up or
down.
Mr. Totonis. Mr. Clawson, I think your request of getting
the data is an important one. I am not part of the Government.
I am much in the public sector. What I don't understand is why
don't you have the data? The data exists. The only--my
perspective is, as a CEO, if my board said, get me the data,
they would have the data in the next 24 hours.
Mr. Clawson. I spent 12 years as an international CEO. I am
appalled by how little data I get as a board member. I can't
criticize or compliment management if I don't know anything,
and I don't know anything.
Ms. Duke, I don't dispute that there is a morale problem,
but if I don't know anything, how is my opinion valid?
Mr. Totonis. So why is DHS not giving you the data?
Mr. Clawson. Sorry. I yield back. Sorry.
Mr. Totonis. So why is DHS not giving you the data?
Mr. Perry. I think it is a great discussion, but in the
interest of time and other Members, maybe there could be a
conversation between Mr. Clawson and yourself personally and
your staff to the gentleman from Florida, because if the data
is available, it sure seems like we should have that. There is
a genuine frustration without having it to determine where we
are. So I think it is a point well made and worthy of follow-
up.
That having been said, the Chair thanks the gentleman, and
recognizes the gentleman from Georgia, Mr. Loudermilk.
Mr. Loudermilk. Thank you, Mr. Chairman. I want to pick up
on the morale issue. I have seen, in most organizations that I
have been in, I was in the military, I worked in an environment
that was a very mission-critical environment. In intelligence,
you were in a position where you didn't get a lot of public
accolades, because of a lot of what you did never happened. I
expect the same thing in the Department of Homeland Security.
Much of what we avoid never gets out to the public.
But as was mentioned, morale, from what I have seen, is
based on commitment to the mission, having the tools to
complete the mission, and self-gratification that you are doing
something for the Nation.
I have also seen that in most efficiently-run
organizations, there is high morale, and it is the ``boots on
the ground'' that have the best ideas and solutions to make the
organization more efficient because of their commitment to the
mission.
So I am greatly concerned that the concern that you guys
are having and that I am having of how low the morale is in the
Department of Homeland Security. In fact, there was a study,
2014 Partnership for Public Service Best Places to Work
rankings, and DHS was last. Especially with a critical mission
of National security, I would expect it to be not dead last,
but near the top. Because, again, the motivation factor and the
morale is a lot driven by the mission that you have.
I have also experienced that when there is low morale, it
is a management issue. A lot of times, it is politics that are
overriding the mission. A lot of times it is management seeking
promotion of themselves, not promoting the mission to the
people. I have been to the border, and I have seen the
frustration of Border Patrol of accomplishing their mission of
stopping people from coming across the border just to have them
released back into society. They are risking their life to do a
mission, but they can't accomplish the mission because of
politics.
Can any of you give us an idea? Am I on track? Is the
morale as bad as we are anticipating? What is the problem so we
can, hopefully, together come up with a solution?
Mr. Pearl. If I can, and I am sure there will be multiple
opinions, just briefly. What goes on within the beltway of
Washington by the people who are involved in policy and program
is sometimes disconnected from the boots on the ground.
So for that reason, about 5 or 6 years ago, we began to
take our senior executives out to those folks that are working
the land borders and sea borders and airports across the entire
plain. What we found is, is morale is extremely high. The
people that are doing the work, no matter what rubber band or
gun is sent from Washington, they are going to make it work,
and they are extremely tied to the mission. That is at least
part of what we saw, the people that are doing the work that we
have asked them to do.
There is no question that this is not really a morale
issue, certainly, that I talked about today. It was really
about how do we train people to feel that they are getting the
skill sets that they need in order to do their job. That is
what--if there is any ``complaint'' that we have heard from
people who are doing acquisition work, who are doing program
work across the board is that they want to get trained; they
want to raise their level of skill set because they entered
this field in the first place for altruistic reasons, and that
remains. They really do want to serve the country in no way
different than the person who puts on a uniform.
So from that standpoint, our perception is that I think it
is a little bit further to the right, you know, to the center
of a better-run agency when the people on the ground feel that
way and you have things like what Secretary Johnson has put
forward and his leadership has put forward, which is a
structure by which they can work within that. Mr. Totonis
talked about, now the question is, how do you implement that?
I talked about, how do you bridge the gap between
aspirations and actual operation? That is what industry is
working with Government about. We are working very closely with
them. We just launched what we call a 2020 vision project that
is going to look at what the state of Homeland Security is, not
just now but in the year 2020. We have to look ahead to see
what that Department is going to look like. We are all in it
together, the Congress, the Department, and industry.
Mr. Loudermilk. Ms. Duke, could you respond to that
question as well?
Ms. Duke. Yes. My personal experience is part of the morale
is feeling disenfranchised. They do have pride in their work,
but my experience is it is more politicized in DHS. More
issues--and I did work in DOD also. More issues that you
wouldn't think would be political, are political.
So the role of the--especially, the senior executives, the
supervisors, it is hard to connect in terms of them feeling
part of the mission, because a lot of the mission set and a lot
of the decisions are made politically and not by--as much by
the senior civil servants as was my experience in DOD.
Mr. Loudermilk. Okay. I would like to continue this on, Mr.
Chairman, but in respect of the time, I see that my time has
expired, so I yield back.
Mr. Perry. The Chair thanks the gentleman. With your
indulgence, I think we will try for a second round, if you are
interested in sticking around, and of course if the witnesses
are, at least up until the time of votes if that occurs.
I would like to start another line of questioning with Ms.
Duke. You mentioned in your statement something I found a
little bit intriguing. I don't mean to be naive about the
situation, but Presidential transition, can you give us
specifics of what you were thinking and what we can expect and
what the potential pitfalls are and what the trepidation,
apparently, is in regard to this?
Ms. Duke. Well, the person in DHS charged with leading the
Presidential transition is the under secretary for management.
So I did it for President Obama. DHS has about 200 political
appointees, which you lose.
Also, during transition, if the future is like the past,
there is a heightened sense of terrorist potential insecurity.
So DHS employees have a daily role. They have to sit at their
desk and do their role. But during transition are they ready
for the heightened state of security and the possibility of an
act of terrorism while they are missing 200 of their most
senior leaders.
We will probably start losing the political appointees in
August, September of next year, so you have really a 6-month
period there. So is everybody ready and prepared from an
operational standpoint to perform and to carry the Department
administratively through that time?
Mr. Perry. So employees in anticipation, your senior
management starts departing; they don't wait until the last
minute----
Ms. Duke. Correct.
Mr. Perry [continuing]. Which is understandable completely.
Those who are left in the agency that have been doing the nuts
and bolts work, the not at-will employees, so to speak, they
are nonpolitical employees, are left holding the bag.
What is you--do you have a recommended solution set, or is
it just the reality of, you know, do we just accept it and try
to make the best of it?
Ms. Duke. My recommended solution is that Under Secretary
Deyo prepares as the leader of transition, but has a career
team in, because he will be submitting his resignation, and
whether the new President accepts it or not, but just in case
he does, that you have a career team.
Putting them together and exercising them right now, making
sure they know each other, making sure they know their roles,
you know, some of the basics, reach each other on an
operational status.
Mr. Perry. So that is your proposed solution set. Is that
occurring?
Ms. Duke. I believe it is. Also having succession planning
in place. But, yes, I believe they are starting now.
Mr. Perry. I mean, is that something that we should ask,
particularly, as an oversight body, or do we make the
presumption? You know, again, we don't want to unnecessarily
drag people in for a hearing, but quite honestly, from my
perspective, sending a letter, I won't say we--we do get a
response. We get responses that are often, I hate to say it,
untimely. Even more to the point, they are political, and they
don't really answer the question, which is why we are compelled
to drag people in, because we feel like that if we are face-to-
face, we can finally you know, pin somebody down, and say, come
on, quit playing words to hide the ball here, give me the
answer.
So is this an innocuous enough question, I guess, to
believe that if we make the request, we will get an honest
answer and in a timely fashion?
Ms. Duke. My interaction with Under Secretary Deyo is that
you would, and that he could tell you who he is naming as his
career lead, and that they would be willing to talk to you. I
believe it is worth a try.
Mr. Perry. All right. Thank you for that.
Let me see. I just got so focused on the answer to that,
that I didn't think about all my other notes here.
Let me tell you what, in the interest of time, I am going
to turn to the gentlelady, if you are interested and prepared.
Mrs. Watson Coleman. Thank you very much.
Mr. Perry. Yes, Ma'am.
Mrs. Watson Coleman. First of all, every department in
Federal Government experiences a transition. But for some
reason, it has a harsher impact in this Department, because
this Department has not really jelled yet with all of its
various components. Is that accurate? Plus its mission.
Ms. Duke. Right. I think partly because its mission is
diverse and most of the operational instance have been natural
disasters, not acts of terrorism, which has a little bit
different operational response. I think some of the--the
geographic dispersion of especially the senior leaders, they
don't have that daily contact that you have in the Pentagon
where you kind of run into each other.
Being all over the--not having an operational center that
they meet in regularly. Even natural disasters are handled from
different operation centers. FEMA has its own, because we don't
have the vision of the St. E's Op Center that we had. So I
think that that makes them not prepared. There aren't as many
exercises in DHS that you might have in some other operational
agencies. I think that is really important.
Mrs. Watson Coleman. So the complex, is it St. Elizabeth,
that would be the proposal to bring all these series of
entities together, right? It is really important that we kind-
of stay focused on that.
Mr. Loudermilk, he spoke something that I had just been
thinking. It is sometimes hard to defend how efficient the
Department has been in certain areas, not the natural disaster
areas, but in the prevention of other areas like terrorist
attacks, of that nature. It is kind-of hard to say, well, we
stopped 75 da, da, da, da, da, you know. We need to keep that
in mind.
So when I am listening to you all, because you all didn't
come here just to talk about morale, obviously. You talked
about, you know, operational efficiencies, effectiveness. That
is what, I think, you were doing. I look at this huge entity,
and at the top of this, you know, is this. At the top of this,
there is this, and so there is connectivity there. Then you
have these entities, these elements or components they call
them--but there is very little of this at that level.
So are you proposing--am I making sense? Are you proposing
that we don't need this sort-of horizontal interaction as much
here as we do up there? If we have it up there, we are have
unity of effort, unity of mission, unity of value, unity of
service, unity of expectation, and the resources to implement
that this will kind-of happen?
Ms. Duke. From my perspective, I was suggesting that you
have to drive change through leadership. So leadership has to
drive the change. I think at the lowest level, it is imperative
that we have that. I think some of the facilities
consolidations that are happening in certain geographic areas
will hopefully help that. Because then you start with the
overhead and then can get to the mission. But I think it has to
be both sides.
Mrs. Watson Coleman. So you know, we talk a lot about
morale issues and how important they are. Then you mentioned
something about the morale issues, sort of in the higher level,
more highly-paid employees of the Department. I am thinking of
the people on the border. I am thinking of people at the
airport. Like, no one likes them. So by the time I get through
security, I am like, oh, God do I have to take another thing
off, you know.
So for me, it is really important that the Department not
only deals with the morale issues at the sort-of leadership
level, which they are paid well enough to be self-motivated and
have high morale, but also we need to figure out a way to
reward, acknowledge, and appreciate those that really have
boots on the ground.
Mr. Pearl. I would just say, I will repeat, in terms of the
visits that we have been trying to take to get out of
Washington to see what is going on, we have been surprised,
impressed----
Mrs. Watson Coleman. Yes.
Mr. Pearl [continuing]. By the foot soldiers on ground and
what they are doing. To see the OFO, the blues and the greens,
at the Border Patrol working closely together in Nogales, in
Detroit, in the Southwest. We see those. They are forced to
work together. They are sharing the same footprint. They are
not like in Washington, 70--I think it is 70 officers spread
over 50 locations with regard to the Department inside the
Beltway, inside of Washington. They are getting along.
We have met with task forces; we have met with fusion
centers. We are seeing it with State and local, with Federal.
When we go to Seattle next month, we are having a joint meeting
with all of the DHS folks in the Pacific Northwest to find out
where the level of coordination and cooperation is going, to
find out a little bit more about where the morale issues are.
But it really is, from my standpoint, about the morale. You
are in a job at TSA, you are going to be yelled at by the
passenger. The question is: Are you receiving support from the
people that are your supervisors?
Mrs. Watson Coleman. Right. Exactly.
Mr. Pearl. That is what training does; that is what the
private sector, as Mr. Totonis talked about, that is what we
want to see more of. Within the acquisition space, the Homeland
Security Acquisition Institute has done incredible work to try
to get the program managers and the contracting officers on the
same page with respect to the training. We need that across
enterprise-wide to all the components.
Mrs. Watson Coleman. So I think that--yeah. I think that
this notion of appreciating down to this level, and then
appreciating down to the boots-on-the-ground level, and to stop
saying that this Department has the worst morale, that this is
the worst place in the world to work, you know, but to start
talking about the important work that it does and how we are so
grateful to be safe in this country because of this Department,
will help us sort-of transition out of the negative into the
positive.
Thank you, Mr. Chairman.
Mr. Perry. The Chair thanks the gentlelady. The Chair now
recognizes the gentleman from Georgia, Mr. Loudermilk.
Mr. Loudermilk. Thank you, Mr. Chairman.
I have another line of question, but I still want to pick
up where we left off. Ms. Duke, I think you were getting into
the area, I am sensing that there is maybe a bit of
disagreement from Mr. Pearl and your perspective. Because I saw
a different perspective when I went to the border.
Now I don't know if--you talked to some of the folks who
are, ``boots on the ground.'' But real quickly, when you went,
did you go with supervisors with you, or did you go pull these
folks aside and talk to them one-on-one without upper level
management directing you and--because when I went to the border
recently, I pulled these folks aside. Yeah, there is good
cooperation. They believe in the mission, but they are
frustrated with the politics that prohibits them from
completing their mission.
I mean, you can see it if you go to almost any airport with
the TSA, customer services are reflected by the morale within
that organization, and I can tell you, especially at this
airport, the customer service that I see out of there is pretty
pitiful and the morale seems to be in the tank.
So I think there is a disconnect here somehow, because,
yeah, when we would go to the border, and you have got upper
level or mid-level management that is directing you, you get a
different story from the folks than if you pull them off one-
on-one and talk to them. That is my concern, for some reason
there is a report coming out saying that DHS is the worst place
to work. That is what I am trying to get at. I am not saying
that you are not being forthright with us, because I think you
are. I think we are seeing a different picture.
Mr. Pearl. I am trying to paint a picture maybe in response
that it is not as bad as it appears.
Mr. Loudermilk. Okay.
Mr. Pearl. But I will tell you, and I don't want to bleed
into the money, okay, but when we went to Los Angeles
International Airport, when we talked to the folks from TSA
both without their supervisors and with their FSDs, with the
field office supervisor, No. 1, there was one common theme.
First of all, you have a number of part-time employees who
are TSA inspectors. When money comes in to the TSA at an
airport, it is spent on the whistles and the bells, the X-ray
machines, and all of the baggage stuff that they have to look
at. They showed us how these multiple employees at TSA have to
fill their shift bids for the next quarter on legal sheets of
paper like you and I did when we were in college, that they
have to fill it out on a piece of paper, then it is kind-of
coordinated, and then they get to pick their time, their
terminal, et cetera.
They are using computers that were IBM computers, not
Lenovo Thinkpads that are not necessarily network-connected.
Because when the money does come in, the money that they are
going to use, they know they have to put it towards safety and
security, not internal operations. That is just one little
example. They are very aware of that here in Washington. They
are very aware of that exigency. But where do you place your
dollars that you get?
So will morale be bad when you are sitting around for an
hour-and-a-half waiting to bid on your shift, when United
Airlines flight attendant in the air has a mobile app that can
get her his bid for the next 3 months on every flight that they
want to take while they are in the air? Does that kind-of--is
there a disconnect there? That is one example, sir. That is one
little example of the kinds of morale, efficiencies,
coordination system-wide that is not necessarily being
addressed.
Mr. Loudermilk. Ms. Duke, could you respond?
Ms. Duke. One thing I think that DHS can do to address some
this internally on a more tactical level, is as compared to
DOD, it hired technicians in its rapid growth and didn't focus
a lot on, as much, as my experience in DOD, on leadership and
supervision, leadership from the higher level, how do we keep
employees motivated; how do we deal with some of these skills?
But supervision, how do you deal with performance in the
Federal space effectively, because you can, it is just maybe
harder?
So I think DHS is trying to, in its workforce management
now, make sure that supervisors both supervise and lead. I
think that is something that can be done internally, and I
think that they are looking at now that would be helpful.
Mr. Loudermilk. Mr. Totonis, would you like to weigh in?
Mr. Totonis. No. You know, as a private citizen, you know,
when I go through TSA, I experience such things as you, sir.
The challenges identified is how do we, on the leadership side,
communicate and make everyone within that organization feel
proud that they are keeping this Nation safe and not doing
scanning or screening, right? So what is the bigger purpose for
the mission, and that has to come from the top.
Mr. Loudermilk. Okay. Again, Mr. Pearl, I wasn't trying to
discredit your testimony at all. I was just trying to get what
perceived to be a different outcome, and I appreciate it. Mr.
Chairman, I would yield back.
Mr. Perry. The Chair thanks the gentleman. The Chair
recognizes the gentlelady from California, Mrs. Torres.
Mrs. Torres. Thank you, Mr. Chairman.
Continuing on in this conversation, we are facing yet
another Government shutdown.
When it comes to the security of our Nation, specifically
at airports, I know from being a first responder, that certain
positions are exempt. As a former 9-1-1 dispatcher, my position
was never exempted. How do folks--how do they think that first
responders, for one, would be able to respond to an emergency
if there wasn't someone there answering the phone? I don't get
it.
But let's talk about those nonexempt positions, the person
that is in charge of having to write all of those legal
documents and forms, whose work is piled up or who has to come
in to work thinking about how are they going to make their
mortgage? How do we address that morale from the perspective
that that is an issue that we are creating here, and it is
outside of any management skill or unskilled performance level
that we can, you know, point a finger to except ourselves?
Ms. Duke. I do agree with you, and, you know, you can take
a Civil Service career path, and a lot of people that take the
career path are like, because they like the mission; they like
the security as opposed, to say, maybe a contractor support. So
I do think it affects our ability to draw the best people into
Federal Government, because as a young person is considering
their career, that would go into the ``con'' column of public
service.
Mrs. Torres. Bank of America doesn't take an IOU, we know
that. So you know, having to face that month after month, you
know, with what we are creating here as Members of Congress,
the problems that we are creating for these folks----
Ms. Duke. I think also it does. It adds to the stress. It
adds to the feeling of not being valued, because if you think
you cannot do your job for weeks--it also, for those that are
nonexempt, it hurts so far, and I think it is the right thing,
we have ended up paying--backpaying the people. But they still
have the stress, because they don't know if that is true.
But also then you have the haves and have-nots, the ones
that got paid for staying at home, and the ones that had to go
to work despite anything, and that is a real challenge in terms
of morale, too, balancing that.
Mrs. Torres. Balancing that.
I would like to ask another question regarding the small
business community and our level of outreach.
What can you suggest? Where are the areas where we can
improve to ensure that our departments are doing, you know, a
better job at reaching out to small business? What I am hearing
from, you know, the very, very small businesses that I
represent in my district, is that they have to go through all
of these certification processes only to find out that once the
RFP has been issued, they didn't get it because maybe they
spent a quarter of a million dollars certifying, you know,
their components to meet certain qualifications. But the person
who received, or the contractor that received that contract did
not have to go through that. Oftentimes, they are someone that
is not even in country.
Ms. Duke. I would say, one is training. I know that DHS
will go out throughout the country and help small businesses
understand the system. I think that is really important, to
understand the qualification process. They partner with Small
Business Administration, and I think that is really important.
I think the second thing is communicating. Unfortunately,
you can't even hear the communications unless you know the
system. So I think that workshops, the seminars with the
departments and Small Business Administration throughout the
country, not just in the District of Columbia, are imperative
to solve that problem, ma'am.
Mr. Pearl. But let me give another perspective, if I may.
The private sector has a role in that as well. There is no
question that the Department--when I talked to the folks at the
management directorate, we hit our ``small business goals,''
but that doesn't necessarily go to the issue of capabilities.
You picked a small business that may have been the squeaky
wheel, but that doesn't necessarily go to the capability of the
problem you are trying to solve, particularly at the Department
of Homeland Security.
There are mentoring programs by many of the large
businesses who bring in and identify small businesses, and they
will work with them to get through the necessary clearance
processes.
Mrs. Torres. Who knows about these mentoring programs?
Mr. Pearl. The small businesses who--if you want to align
yourself and you see that you have a capability set that aligns
with an IBM or a Lockheed Martin, or a Booz Allen Hamilton, you
know, the question is, you can identify them. It takes just--it
is a little Google research, who is in that field?
So the private sector has a role. The incentive that in
essence that the Government can give to the private sector is
is that when they do bring in these small businesses, and you
get three or four small businesses to be part of a teaming
process, versus giving one small business one contract, you
can, in essence, leverage that to the betterment of more small
businesses. Because when your contract is involved in south
California or northern Maine, you can, in essence, find the
small businesses that are already there and not have to move
people.
So how this Congress, how the Government can incentivize
the big businesses, to in essence utilize small business
capabilities is something that I would like to see, we would
all like to see Congress and the Government to explore more. It
is a bigger question than just DHS. But in point of fact, small
businesses could benefit by the private sector, the large
business involvement with them.
Mrs. Torres. Thank you. Mr. Chairman, I yield back.
Mr. Perry. The Chair thanks the gentlelady. I finally found
my notes. Mr. Pearl, what you mentioned was examining
incentives, which I think you just kind of fleshed out there a
little bit. So it didn't answer all the questions, but just a
couple of things.
First of all, thank you very much, my colleagues, for
taking the time and interest in, and for you for taking your
time to come in and testify. We certainly very much do
appreciate it.
We would hope that you would continue the conversation. As
many, you know, of course, we have got a lot of big issues on
the plate, and oftentimes in Congress your hair is on fire, it
seems like 24 hours a day, metaphorically, at least. So we
would like you to continue to provide the feedback in the form
of maybe--from my standpoint anyhow, you know, this is the
challenge. This is our proposed solution set, and then a
follow-up meeting.
Because we would like to try to actualize on some of this
stuff as opposed to just continue to have the circular
conversation about it. I really mean that, even if the context
that it is difficult.
You know, I think that, too oftentimes, and maybe
particularly in this case, that the agency is mischaracterized;
that employees/bureaucrats is pejorative. It is not meant to
be. We understand and recognize and acknowledge that these
employees from the bottom to the top, have taken a mission of
civil service of protecting their country and being on a
mission, and that is really important.
So this isn't meant at all to disparage. We are trying to
make things better, quite honestly. I think the questions
regarding morale reflect that.
I will tell you from my perspective, having run my own
organization and served in the military for over 30 years,
anywhere from the rank of private to colonel, that leadership
starts at the top, and it makes an incredible difference. Quite
honestly, in kind of working and agreeing with the Ranking
Member, you know, their morale is self--they are self-
motivated. They get paid well. They have the trappings of the
position, and the expectations appropriately so, on our part,
are high, and they should be.
You know, we are the stewards of the taxpayer's money, and
this committee, in particular, it is our job to provide that
oversight and ask those tough questions and be demanding, and
so we will be. It is not meant to be personal, but it is
appropriate for our mission.
So I guess with that--you know, just one other comment on
the shutdown prospect. I understand the point that is being
made, but I will tell you, having worked in the private sector
and talking to people every single day, dealing with my wife,
who works in a very large business in human resources and
watching the challenges every single day of people, businesses
change, contracts change, employees, no matter who you are or
where you are, there is always a specter of a lost paycheck, a
lost job, having to move, what have you. The Government is not
sacrosanct in that.
Maybe--I hate to say this, and I think some people may find
this not palatable, but if your job application, let's say, you
take this job and accept it willingly knowing that this is no
different than the rest of the real world. Things happen,
things change. It is imperfect. We are trying to do the best we
can. You might not get a paycheck. You might be required to
move. You might have the same thing that everybody else on the
planet has to deal with.
Thank you very much for your service. We invite you to
participate, and we want you to come. I mean, really. So maybe
that is enough of that.
Let me get on with the perfunctory portion of this. The
Chair thanks the witnesses for their valuable testimony and
Members for their questions. The Members of the subcommittee
may have some additional questions for the witnesses, and we
will ask you to respond to those in writing.
Pursuant to committee Rule 7(e), the hearing record will be
open for 10 days.
Without objection, the subcommittee stands adjourned.
[Whereupon, at 11:40 a.m., the subcommittee was adjourned.]
A P P E N D I X
----------
Question From Chairman Scott Perry for Marc A. Pearl
Question. In recent years, the American public has grown
increasingly dissatisfied with our Government. A February 2015 Forbes
article stated, `` . . . more people in the United States place their
trust in business before the government . . . a 60 percent trust level
in business as opposed to the government's 41 percent.'' This is not
hard to believe considering the numerous failed programs, wasted
monies, and misconduct among Federal employees. What recommendations do
you have for DHS, specifically, to promote transparency, increase trust
with the American public, and improve individual accountability?
Answer. DHS, as an agency, is not well-understood by the general
public. Some of the negative image and distrust that the public has
towards DHS comes from a lack of understanding as to its history and
mission. Many in the public see DHS as a newly-created agency, one that
only came into existence as a result of 9/11. Some people have the
mindset that if we did not have the agency before 9/11, then we
probably do not really need it now. They see DHS as bureaucratic bloat
and waste that we did not have prior to 9/11. Most people fail to
realize that the majority of the individual agencies and areas of
responsibilities that make up DHS (e.g. immigration, customs, border
security, FEMA, Secret Service, Coast Guard) have long existed in our
Government, just under different names or different organizations.
While many people are familiar with the Coast Guard and Secret Service,
they may not know that these agencies are part of DHS.
To the extent that the public is familiar with a component of DHS,
they likely have a limited and skewed understanding of what the agency
actually does. Their knowledge comes from their limited exposure with
the agency or to what they see and hear on television. They may see
FEMA as the people who bring water during disasters or the Coast Guard
as the people who patrol the waters and rescue people. They may have
the impression that TSA are the people who search and delay you at the
airport or that CBP agents are the people who hassle you when you come
back from vacation.
To help improve transparency and increase trust, it would be
helpful for DHS to develop a marketing and awareness campaign that
helps educate the public on all of its mission areas. DHS has many
important missions that protect and strengthen National security, the
public health, and the economy but they are invisible to the average
citizen. There is always National media attention on the things that
DHS does wrong vs. the things it does well. DHS and the administration
need to find more ways to advertise successes, highlight the bad things
that DHS has stopped, and explain the benefits it provides so that the
public can gain a greater appreciation for the agency.
As an example, the public hears that DHS is allowing illegal
immigrants into the country, but it does not understand the economic
gains associated with facilitating lawful trade and travel at our
borders. It does not hear about the drugs, weapons, and contraband that
are seized everyday by border agents. It does not hear about the
illegal immigrants that are caught and returned to their country. It
does not hear how agents at the border protect our economy from
counterfeit goods or protect our agriculture from pests and diseases.
DHS plays an important role in safeguarding our country, but few people
know or understand its mission or achievements.
Questions From Ranking Member Bennie G. Thompson for Marc A. Pearl
Question 1. Mr. Pearl, you identified the Office of Biometric
Identity, or OBIM as an example of an effective operation. There is
discussion of moving OBIM to an operational component, specifically
CBP. Do you see any risks in transferring OBIM?
Answer. Our members do not support or reject any decision to move
OBIM to an operational component of DHS. However, there are
considerations of risk that should be carefully thought through in
advance of moving the office.
OBIM provides biometric capabilities, services, and data across the
Federal enterprise as well as to some State, local, and international
partners. Its Federal customers currently include or will soon include
the State Department, Department of Justice, Department of Defense, the
intelligence community, the Office of Personnel Management, and the
many components of DHS (CBP, CIS, TSA, FEMA, USCG, ICE, NPPD, Secret
Service, and Management). While CBP is currently the largest consumer
of OBIM services, that is likely to change in the future as more people
become reliant on biometrics for identity proofing, including industry.
To fulfill its growing mission, OBIM will need to focus on developing
new and improved services and business processes, technical
capabilities, and models for rapid delivery of services to a wide range
of customers.
If OBIM is moved to CBP or any another operational component of
DHS, it will become a consumer, manager, and broker of the data.
Therefore, legislators need to ensure that the agency does not become
narrow-minded in its thinking and decision making. By placing OBIM in
an operational component of DHS, there is a risk that strategy,
operational, technological, and financial decisions are made within the
mindset of and to the benefit of a specific component vs. other users
of the system.
The office and its capabilities should be viewed as a National
asset within a larger and evolving National construct on biometrics.
Given its National and perhaps international significance, the agency
must be able to think and act objectively beyond the interests and
priorities of a single operational component. It will be critically
important to ensure that the office maintains a level of autonomy and
accountability separate from its ``owner.''
The system that OBIM uses to store and analyze the data is the
Automated Biometric Identification System (IDENT). This database is
part of a larger ``system of systems''. Its effectiveness is reliant on
both an upstream and downstream of data from many partners. Developing
and maintaining engagement and relationships with all stakeholders is
critical to the success of OBIM and the entire biometric ecosystem. No
matter where OBIM gets moved to, legislators must ensure that the
office has the authority and ability to think and make decisions in a
broader National context. The implications to National security cannot
be understated.
Question 2. What factors prevent DHS from responding to private-
sector firms, regardless of their size in terms of packaging its
acquisitions and procurements in a manner which will allow companies to
fairly compete for contracts?
Answer. To answer this question, it is important that the committee
understands two different factors are in place. First, let me explain
the factors that influence a private-sector firm's decision whether or
not to bid on a Federal contract. Then you will have a better
understanding of the factors at DHS that have the effect of either
encouraging or discouraging companies from competing for Federal
contracts.
The decision by a private-sector firm (whether large, mid-tier, or
small) to compete for a Federal contract involves a careful assessment
of risk. Financial investments in pursuit of opportunities are
significant. On average, companies spend approximately 1-2% of the
total value of a contract in the proposal phase alone. This may not
sound like much, but it could cost between $500,000-$1 million to
pursue and bid on a $50 million opportunity. Because the costs of
getting to know a prospective client, understanding the requirements,
developing a technical approach, selecting a team, and preparing a
proposal are so high for industry relative to the return on that
investment, industry tries to make decisions on whether or not to bid
as early in the acquisition life cycle as possible. That is why both
the substance and timing of communication with industry is so
important.
Overhead, bid and proposal costs limit dollar expenditures, and
companies do not want to submit a bid if they do not think they have a
good chance of winning, and can successfully provide the capabilities
and/or needed solutions. They would rather devote their resources to
procurements for which they can be successful. Industry does its
investment planning, particularly as it relates to investments in
pursuit of new business, over multiple years. Therefore, procurement
forecasts play a significant role in determining their priorities.
Industry tracks the status of DHS procurements and devotes substantial
time and energy to learning about DHS's needs and thinking through ways
to meet them. Decisions on whether to compete are often based on the
level of information that can be obtained in advance about an
opportunity.
As much advance and relevant information about future requirements
is used to focus industry's attention. The earlier that industry has
specific forecasting and procurement strategy information from
Government, the more likely they are to devote their resources to the
Government's needs and/or decide they should not waste their resources.
For small businesses, these issues take on even greater importance.
While a small business can partner with a bigger business to perform
the work, they need working capital (e.g., the ability to make payroll)
to pursue multiple contracts. A small company (whether or not it
``fits'' into the Government definition) often cannot pursue multiple
contracts at the same time because of the resources involved. They need
to invest their funds in only a few opportunities and make decisions
wisely. This concept of risk management is often overlooked or under-
appreciated by Government officials.
Industry must have the ability to meet with the appropriate
Government officials early in the process so that they can understand
their requirements and assess the risk associated with bidding. Firms
must be able to gain information that allows them to answer the
following types of questions:
Do we clearly understand what the Government is trying to
achieve and accomplish through the contract?
Can we do the work and succeed in execution?
Do we have a competitive advantage?
What is the likelihood that we can win the contract?
Can we make a profit? (Requirements must be specific enough
that industry can come up with a realistic cost estimate. This
increases confidence that industry can deliver profitability at
their bid price.)
What are the business practices and history with
procurements of that Government customer?
What are the opportunity costs?
What is the anticipated length of the process (e.g., what is
the likelihood of a delay of award after proposals are
submitted?)
Industry days and other engagement forums that share information
with industry well in advance of Requests for Proposals (RFPs) generate
interest in a greater number of companies, enabling them to make more
informed and earlier decisions on whether to bid. When information is
available early in the process, it gives companies an opportunity to
consider technical approaches sooner, and build teams around those
approaches rather than selecting teams at the last minute based on
other factors.
While DHS is working hard to establish earlier and more substantive
communication with industry in advance of procurements, there are
several factors that prevent or discourage it from having or providing
the needed communication and engagement with industry:
Acquisition schedule and the desired speed of procurements
Communication with industry is often schedule-driven. The
end-date of a procurement does not change for the end-user
so the Government schedule is ruled by this date. This
often impacts what type of communication Government will
have with industry. There are sometimes concerns that
additional communication with industry will create delays
that the schedule does not afford.
Fear of acquisition integrity and lack of understanding of
what the Federal Acquisition Regulation (FAR) allows leads to
no or poor communication.
Despite several mythbusting efforts, there are still
acquisition staff, particularly those that are young and
less experienced, that do not understand what the FAR
allows. There is a lack of understanding as to the who,
what, when, where, why, and how of allowable communication
between Government and industry before the issuance of the
RFP.
Procurement lawyers are also causing too much fear. There
is a lot of inconsistency in the advice that procurement
lawyers give to different components as to how to engage
with industry.
Internal communication and coordination of information
across DHS
There are so many decisions and actions going on at the
same time within the Government during an acquisition that
it is challenging for DHS to determine how to coordinate
information through the organization and push it out to
industry. The result is that information is sometimes
either not provided or is inconsistent.
In addition to the need for early communication and greater
engagement, there are two other factors that strongly influence whether
a private-sector company will decide to compete for Federal work:
1. DHS' ability to clearly define and stick to the requirements in
their procurements
Requirements must be clear and specific enough so that
private-sector firms can come up with a realistic cost
estimate and make the cost-benefit determinations that are
central to determining whether they will pursue the work.
Any ambiguity or change in requirements increases risk. The
effect is that industry either decides not to bid or they
increase the price of their bid to offset the increased
risk.
2. Impact of Delays in Awards and/or Cancellation of Solicitations
Delays (or cancellations or withdrawals of planned
acquisitions) cost contractors significant amounts of
money, which means they may not have sufficient funds to
bid on future activities. Contractors start preparing to
bid months or sometimes years in advance of an upcoming RFP
by forming teams, identifying potential staff, ensuring
that especially key staff have the right certifications and
experience, and sometimes making research investments to
better position the team for the opportunity. When the
Government delays an RFP by months, contractors must
continue to spend money to keep the teaming, potential
solutions, and possible staff in place. Similarly, when the
Government delays issuing an award or task order after
proposals are submitted, contractors must figure out how to
keep staff ready and available to work once an award is
made. This means that contractors either pay the salaries
of existing, highly-skilled staff for extended periods of
time even when the employees do not have revenue generating
work to do or they incur termination expenses for the
existing staff and hiring expenses for replacement staff
when the award is made. In the end, the company expenses
that are incurred when an opportunity is delayed or
cancelled often drive up the company's G&A rate, with those
costs effectively being passed on to the Government.
Procurements that are awarded too long after the proposal
is submitted present substantial risk because pricing for
the bids was based on a specified award time frame. The
vendor thus bears the burden of rising labor costs with
diminished margins in supporting the program.
Extended delays of actual awards contribute to increased
financial risk because dollars dedicated in the pursuit of
the opportunity are expensed in 1 fiscal year and potential
earnings are extended to a later fiscal year. Companies
tend to become more reluctant to bid on these programs.
Spending money that does not have the potential to generate
revenue for more than 2 years is a difficult move for many
companies to make, especially small businesses.
Thank you, again, for the opportunity to present the collective
perspective of the members of the Homeland Security & Defense Business
Council in answer to your follow-up questions to the recent hearing.
The Council looks forward to continuing our long-standing
relationship with the committee on the critical issues you are
tackling.
Questions From Chairman Scott Perry for Harry Totonis
Question 1a. In your testimony, you stressed the importance of a
``Shared-Services Organization'' and pointed out that a key function
for an organization as diverse as DHS would include ``real property
management.'' A recent Inspector General report regarding the
Department's warehouse inventory stated: ``Because the warehouse
inventories are inaccurate, DHS cannot manage warehouses or demonstrate
compliance with requirements to limit the size of real property
inventories and reduce costs.''
While the Department did concur with the report's recommendations,
what advice would you give to DHS to better manage its inventory?
Answer. My knowledge of inventory management is limited to a CEO's
perspective. Based on my experience, in order for DHS to better manage
its inventory, I would examine DHS's entire sourcing approach/strategy.
By optimizing the every step in the sourcing chain DHS will most likely
be able to reduce costs across several areas and significantly improve
inventory management. The good news is that significant progress has
been made in sourcing and inventory management (including processes and
technology) starting back in the '90's. Many experts exist in this area
that could help DHS.
Question 1b. Why is real property management so important to an
organization's effectiveness and efficiency?
Answer. I have found real property management is no longer just
about square footage costs. It impacts an organization's effectiveness,
efficiency, and employee morale. For example, the questions that I
typically ask when I am evaluating real estate include:
Is this property located near employee pools that can I
access to meet the organization's people needs?
Is this facility at a location where employees will find it
attractive to live?
Is the layout consistent with today's best practices? Open
layout; access to technology; spaces that facilitate employee
interaction, ideation, and problem solving?
Do the facilities include technologies that allow employees
to interact, exchange knowledge, drive innovation and foster
collaboration?
Question 2. In recent years, the American public has grown
increasingly dissatisfied with our Government. A February 2015 Forbes
article stated: `` . . . more people in the United States place their
trust in business before the government . . . a 60 percent trust level
in business as opposed to the government's 41 percent.'' This is not
hard to believe considering the numerous failed programs, wasted
monies, and misconduct among Federal employees. What recommendations do
you have for DHS, specifically, to promote transparency, increase trust
with the American public, and improve individual accountability?
Answer. Unfortunately the Forbes article (February 2015) you quote
appears to capture the sentiment of the American public these days.
However, while one can point to failed programs, the contributions of
Government over the years have been many, enormous and invaluable. I
believe the perception of the American public today is been shaped by
four attributes:
1. The perception that Government never has enough funds and a need
exists to constantly increase taxes. Businesses improve
productivity, reduce costs, and live within their means.
Quality improves while prices come down. The perception of the
Government is exactly the opposite. When was the last time that
a Government agency significantly reduced operating costs?
2. The poor handling of key ``touchpoints'' or very visible
activities. Examples that come quickly to mind include VA, TSA,
and the Secret Service:
a. Reports that veterans are dying while they wait for months
to receive care
b. TSA employees that overstep their authority
c. The reported exploits of Secret Service Agents.
3. Despite of the above, very few people (if any) lose their jobs.
4. Many reports that Government agencies are engaged in highly-
secretive activities collecting information on American
citizens, listening to conversations, etc.
To make progress on transparency, trust, and accountability I would
recommend that Government become leaner, improve execution, and be more
aggressive on terminating employees that don't deliver.
Questions From Ranking Member Bennie G. Thompson for Harry Totonis
Question 1. As an executive in the private sector, what have been
some of the key features of on-boarding programs that you have
experience with, and what made those features important to the
operation of the programs?
Answer. By ``on-boarding programs'', my assumption is that the
question is asking about employee on-boarding programs. In my
experience, the following practices are key:
Strong orientation programs for all new employees on company
culture and definition of success
A training program to make sure employees are confident and
ready to begin their job with the first 3 to 6 months
Mentor(s) for all incoming employees
Access to resources to quickly address any issues that
surface
Holding mentors and managers responsible for developing new
employees
Formal reviews at 3 and 6 months and at the end of the first
year
Statistical evaluation of new employee success as input to
shaping the on-boarding program.
Question 2. What are some of the performance metrics and assessment
criteria that your companies have used to measure the effectiveness of
on-boarding programs?
Answer. I have used the following performance metrics for
evaluating the effectiveness of on-boarding programs:
The attrition rate for new employees.--A strong on-boarding
program should translate into lower turnover.
New employee productivity.--A strong on-boarding program
should translate into achieving rapid productivity.
Overall employee morale.--An on-boarding process helps new
and existing employees. In my companies, I make the execution
of on-boarding program the responsibility not of the human
resources department but of existing employees. When existing
employees are responsible for the on-boarding program they tell
and retell the company ``story''. They are reminded the
criteria that makes the company a success and take
responsibility of new employees. I measure and look at existing
employee participation to on-boarding programs.
Question From Chairman Scott Perry for Elaine C. Duke
Question. In recent years, the American public has grown
increasingly dissatisfied with our Government. A February 2015 Forbes
article stated: `` . . . more people in the United States place their
trust in business before the Government . . . a 60 percent trust level
in business as opposed to the government's 41 percent.'' This is not
hard to believe considering the numerous failed programs, wasted
monies, and misconduct among Federal employees. What recommendations do
you have for DHS, specifically, to promote transparency, increase trust
with the American public, and improve individual accountability?
Answer. DHS can promote transparency through clearly and timely
communicating to the appropriate body (Congress, GAO, IG, American
public) what actions they are taking to secure the homeland, and
equally important why they are taking them. This communication can be
done within the appropriate classification levels, including
Unclassified for the American public. If the public generally
understands the threat to the homeland, and how DHS's actions are
developed and changed to address those threats, most of the American
public will be more understanding. This is especially important when
changes in those actions affect the public. Information, done well,
will not inject fear into the public, but will help them understand and
adapt to the changing terrorist threat.
In terms of individual accountability, DHS must take actions
related to the workforce. The necessary actions are revealed by the
Employee Morale Survey, and related to accountability, include both
rewarding exceptional performers and taking action against poor
performers. This requires a good performance evaluation system with
evaluation factors that are meaningful and directly tied to the most
mission-driven aspects of the employee's work. It also requires
supervisors that are knowledgeable in employee performance management,
so they can take appropriate actions. Along with that, supervisors
should be rated on their management of the workforce, not just
technical aptitude. Finally, DHS should continue to expand how it
appropriately include all employees in its plans, priorities, and
missions. DHS employees will be more accountable if they understand and
are engaged in mission. That must flow down to all levels of the
organization, to ensure accountability of each employee.
Questions From Ranking Member Bennie G. Thompson for Elaine C. Duke
Question 1. As the committee proceeds with its reauthorization of
language for the Department, inclusive of its acquisition practices,
what suggestions could you offer to DHS to become more proactive and
effective in its engagement with industry?
Answer. DHS must do more to engage industry very early in the
acquisition process, well before a contract is contemplated. DHS
procures most of its services and products as commercial and
nondevelopmental items. DHS must talk with industry early in its
process, when it first is researching an unmet mission capability and
determining how to best meet that capability. Industry is invaluable to
helping DHS understand what is currently available, and how those
products/services would have to be modified to meet DHS's mission
needs. Additionally, these early discussions help industry plan and
effectively spend its IRAD dollars. The earlier and better DHS can
communicate its plans and potential needs, the better and more
efficiently industry can plan to meet those needs.
Question 2. Is the Department now better-positioned to implement
reforms and achieve management integration given its current senior
leadership and initiatives?
Answer. Yes, for two reasons. First, Secretary Johnson's Unity of
Effort memo reflects a maturation of the earlier management integration
vision. It develops and integrates the original building blocks in a
manner that should achieve the necessary reforms and integration if
effectively executed. Second, the current senior leadership appears to
have a good definition of roles and responsibilities. DHS headquarters
(HQ) senior leadership is generally working on matters appropriate for
HQ, and allowing component senior leadership the appropriate latitude
to execute the individual missions. Additionally, the two DHS-wide
leadership forums, Senior Leaders Council (SLC) and Deputies Management
Action Group (DMAG), can provide the necessary focus on key issues as
well as the top-down integration of the components.
Question 3. DHS's track record of poor program execution decreases
its buying power and in turn delays its ability to adhere to schedules
for delivering program outcomes timely. What are the most critical
steps the Department needs to take to improve its acquisition
management practices?
Answer. One critical step is proper staffing of both the
contracting and program management offices--with the right number of
people with the right skill sets. This number and type isn't one-size-
fits-all, it depends on what the component acquires. However, DHS
leadership should take steps to ensure each major program and
acquisition office is appropriately staffed. Related to this is
ensuring that each employee performing an acquisition role (such as
program manager, contracting officer's representative, etc.) have
performance evaluation factors related to that acquisition function.
This includes law enforcement and military personnel currently
performing acquisition roles.
Another critical step is to continue to strengthen and define the
role of the DHS chief acquisition officer (CAO) and each component's
chief acquisition executive (CAE). The CAE in each component is
critical to that component's ability to successfully deliver
acquisition programs. CAE's organizational placement, support of
leadership, and authorities are not consistent within the various
components. They should be given the necessary authority to match their
delegated acquisition responsibility.
A third critical step is moving forward with the Joint Requirements
Council (JRC) reestablished by Secretary Johnson's Unity of Effort
memo. The JRC has the ability to greatly improve DHS' buying power by
rationalizing requirements, appropriately standardizing, and eliminated
duplicative systems, products, and systems. DHS has the JRC's
established and meeting, it is critical that they deliver results. This
will not be easy, as it requires active and positive participation of
all components. Though not easy, it is essential.
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