Overseas Staffing: Rightsizing Approaches Slowly Taking Hold but
More Action Needed to Coordinate and Carry Out Efforts
(30-JUN-06, GAO-06-737).
In 2001, the administration identified the rightsizing of
embassies and consulates as one of the President's management
priorities. Rightsizing initiatives include: aligning staff
overseas with foreign policy priorities and security and other
constraints; demonstrating results by moving administrative
functions from posts to regional or central locations; and
eliminating duplicative functions at posts. This report (1)
discusses the size and recent trends in the U.S. government
overseas presence, (2) assesses the congressionally mandated
Office of Rightsizing's progress in managing the U.S.
government's overseas rightsizing efforts, and (3) assesses the
process and outcomes of the legislatively mandated rightsizing
reviews of overseas posts.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-06-737
ACCNO: A56203
TITLE: Overseas Staffing: Rightsizing Approaches Slowly Taking
Hold but More Action Needed to Coordinate and Carry Out Efforts
DATE: 06/30/2006
SUBJECT: Americans employed abroad
Consulates
Downsizing
Embassies
Human capital management
Labor force
Mission budgeting
Policy evaluation
Staff utilization
Strategic planning
Rightsizing
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GAO-06-737
* Report to the Chairman, Subcommittee on National Security, Emerging
Threats, and International Relations, Committee on Government Reform,
House of Representatives
* June 2006
* OVERSEAS STAFFING
* Rightsizing Approaches Slowly Taking Hold but More Action Needed
to Coordinate and Carry Out Efforts
* Contents
* Results in Brief
* Background
* Cost Sharing and New Embassy Compounds
* Accurate Data on Personnel Overseas Not Yet Available; U.S.
Government Rightsizing Efforts Under Way
* Accurate Data on Size and Composition of the U.S. Overseas
Presence Currently Unavailable
* State Developing Unified Staffing Accounting System
* Agencies Rightsizing Efforts Lead to Increases or Decreases
in Staff
* Rightsizing Efforts Driven by Security and
Administrative Costs
* State Has Established an Office of Rightsizing, but More
Interaction Needed between Office of Rightsizing and Agencies
* Office of Rightsizing Established within State
* Office of Rightsizing Is Involved in a Number of Initiatives
* Rightsizing Reviews
* Post Rightsizing Review Plan
* Rightsizing in Post Mission Performance Plans
* NSDD-38 Application Process
* Quarterly Rightsizing Reports
* State Regionalization Efforts
* State/USAID Shared Support Services
* Agencies Cite Limited Interaction with Office of
Rightsizing; More Coordination Under Way
* State Holds Rightsizing Interagency Summit
* Office of Rightsizing Initiates Rightsizing Reviews, but Reviews
Have Not Realized Full Potential
* Rightsizing Review Structure and Guidance Have Evolved
* Approach to Conducting Rightsizing Reviews Varies by Post
* Posts Identified Challenges in Conducting Rightsizing
Reviews
* Resistance by Non-State Agencies at Posts
* Posts Lack Direction and Opportunities for the
Regionalization and Outsourcing of Services
* Rightsizing Reviews Overlap with Additional State Data
Requests
* Cost Analysis Was Not a Primary Factor in Rightsizing
Reviews
* Implementation of Rightsizing Review Results Unclear
* Conclusion
* Recommendations for Executive Action
* Agency Comments and Our Evaluation
* Scope and Methodology
* GAO Reports on Staffing and Operations at U.S. Embassies and
Consulates
* GAO Rightsizing Framework and Corresponding Questions
* The Office of Rightsizing's Five-Year Rightsizing Schedule
* Comments from the Department of State
* GAO Comments
* GAO Contact and Staff Acknowledgments
Report to the Chairman, Subcommittee on National Security, Emerging
Threats, and International Relations, Committee on Government Reform,
House of Representatives
June 2006
OVERSEAS STAFFING
Rightsizing Approaches Slowly Taking Hold but More Action Needed to
Coordinate and Carry Out Efforts
Contents
Tables
Figures
June 30, 2006Letter
The Honorable Christopher Shays Chairman, Subcommittee on National
Security, Emerging Threats, and International Relations Committee on
Government Reform House of Representatives
Dear Mr. Chairman:
After the 1998 terrorist attacks on two U.S. embassies in Africa, two key
studies recommended that the U.S. government evaluate and realign the
number and location of U.S. personnel working at embassies and consulates
overseas, and consider staff reductions where practical to reduce security
vulnerabilities.1 In 2001, the administration showed its support for the
realignment of personnel and stressed the importance of security,
efficiency, and accountability in U.S. government staffing overseas by
identifying the rightsizing of embassies and consulates as one of the
President's management priorities.2 Rightsizing initiatives include
establishing mechanisms and processes to align the number and location of
staff assigned overseas with foreign policy priorities, and security and
cost constraints; moving administrative functions away from posts to
remote3 locations; and eliminating duplicative functions at posts. In 2002
we developed a framework for assessing embassy staff levels to help
support rightsizing initiatives for existing facilities overseas.4 Our
framework identified critical elements of embassy operations-physical
security, mission priorities and requirements, and cost-and also included
rightsizing options for consideration. According to the State Department's
(State) Office of Inspector General, rightsizing is likely to remain at
the top of State's management agenda in the coming years because of high
construction and operating costs overseas, security vulnerabilities, and
continuing problems in assigning U.S. government personnel overseas.
Over the past five years, we have provided the subcommittee with numerous
reports and testimonies on staffing and operations at U.S. embassies and
consulates overseas (see app. II for a list of these reports). In this
report, we (1) discuss the size and recent trends in the U.S. government's
overseas presence, (2) assess the progress that the congressionally
mandated Office of Rightsizing the United States Government Overseas
Presence (Office of Rightsizing) within State has made in managing and
coordinating the U.S. government's overseas rightsizing efforts, and (3)
assess the process and outcomes of the legislatively mandated rightsizing
reviews of overseas posts.
To address these objectives, we analyzed the activities of State's Office
of Rightsizing, as well as rightsizing activities of some of State's
regional and functional bureaus. In addition, we met with seven
agencies-the Departments of Commerce, Agriculture, the Treasury, Defense,
Homeland Security, and Justice; and the U.S. Agency for International
Development (USAID)-which, including State, account for over 90 percent of
personnel at embassies and consulates. To determine if there was a
systematic process for reporting information in the first cycle of
reviews, we reviewed and analyzed 20 out of about 35 rightsizing reviews
that were conducted by posts from late 2004 through summer 2005, and which
were provided to us by the Office of Rightsizing. We also sought to
complete structured telephone interviews with all 22 posts that were
conducting reviews in the fall of 2005. Between February 2006 and March
2006, we conducted structured telephone interviews with management
officers from 20 of these 22 posts overseas on issues related to their
review experience. In addition to the telephone interviews, we visited
three posts-Mexico City, Mexico; Valetta, Malta; and Frankfurt,
Germany-that had previously conducted a rightsizing review or analysis. We
conducted our overall work from May 2005 through May 2006, in accordance
with generally accepted government auditing standards (see app. I for more
information on our scope and methodology).
Results in Brief
Almost five years into the President's Management Initiative on
rightsizing, the U.S. government does not yet have accurate data on the
size and composition of the U.S. overseas presence at embassies and
consulates. At various times, we received estimates ranging from 66,000 to
69,000 American and non-American personnel. In addition, State estimated
that there are approximately 78,000 U.S. government positions overseas, as
of December 2005. Difficulties faced in developing accurate data include
varying practices among agencies and posts in accounting for positions. In
the absence of accurate data, it is difficult to track how rightsizing
actions are affecting overseas staffing levels. Moreover, lack of accurate
staffing data makes it more difficult to determine requirements for new
embassy construction and to assess each agency a fair share of the cost of
the embassy construction program. State is working on a unified database
which, if periodically updated by posts, should provide an accurate
depiction of the overseas presence. State officials indicated that the
database will be completed later this year. Because of the importance of
having accurate data on overseas staffing and the length of time it has
taken to develop this data, management oversight may be needed to ensure
completion of this task. Several agencies reported that they have added
staff overseas as a result of new mission requirements, and other agencies
reported that they have shifted their personnel to better meet mission
needs and respond to rightsizing efforts. For example, the U.S. Department
of Agriculture recently determined that it had overstaffed some locations
and understaffed others and, as a result, is repositioning its personnel.
Some agencies reported that they have reduced overseas staff largely
because they are now required to pay a share of the costs of building new,
secure embassy buildings.
State established the congressionally mandated Office of Rightsizing in
2004, which, after a slow start, has begun to provide overall direction to
the government-wide rightsizing process. Some of the office's activities
have included coordinating rightsizing staffing requests from U.S.
government agencies, developing guidance for and analyzing post
rightsizing reviews, and formulating a rightsizing review plan. We found
that coordination on rightsizing issues between State and other agencies
with an overseas presence was initially slow, but has since
improved-though several non-State agencies have voiced a number of
concerns regarding their interaction with the Office of Rightsizing,
including their desire to be more included in the rightsizing process. In
addition, some post management officers indicated that the lack of
interagency coordination in Washington, D.C., makes it difficult for the
posts to make decisions and implement rightsizing actions.
To move the rightsizing process forward, Congress required that
rightsizing reviews be conducted at every overseas post at least once
every 5 years in order to eliminate or justify any duplicative or parallel
functions at the post, and consider the possibility for reducing U.S.
government personnel. Between late 2004 and summer 2005, about 35 posts
participated in the first cycle of reviews. However, the Office of
Rightsizing provided limited guidance to posts on how the reviews should
be conducted and did not have a systematic process for reporting the
outcomes of the reviews. In fall 2005, officials in the Office of
Rightsizing developed more comprehensive guidance, which post officials we
interviewed said were useful. The Office of Rightsizing reported over $150
million of savings or costs avoided based on their analysis of the first
and second cycles of the rightsizing reviews. Although we have not been
able to independently assess the Office of Rightsizing's estimates, it has
presented evidence to show that some major cost avoidance and cost savings
have occurred. Seventeen out of the twenty management officers we
interviewed said that the review helped them better understand how post
personnel meet mission objectives. However, management officers identified
various challenges in conducting their fall 2005 reviews and ensuring that
their post is rightsized. For example, management officers said that
rightsizing challenges included resistance from non-State agencies on
rightsizing measures, lack of direction and opportunities for
regionalization and outsourcing measures, and a lack of time to conduct
the review due to a number of competing data requests from headquarters.
In addition, while a number of management officers told us that they had
conducted some type of cost analysis as part of their review, some said
that they could have benefited from additional guidance on conducting cost
analysis. It is unclear how the rightsizing review decisions, such as
elimination of duplicative functions, will be implemented, according to
post officials and officials in State's regional bureaus. Moreover, the
Office of Rightsizing has not tasked posts to develop a rightsizing action
plan to implement decisions made in the rightsizing study.
We are making recommendations to strengthen the U.S. government's
rightsizing process. To ensure that the U.S. government overseas presence
under chief of mission authority is accurately accounted for and to ensure
that the U.S. government's rightsizing goals are being coordinated and
that posts can maximize savings and gain efficiencies through rightsizing,
we recommend that the Secretary of State take the following three actions:
o Provide oversight to ensure the timely development and use of a single
database that accurately accounts for U.S. overseas personnel staffing
numbers and has accountability measures to encourage posts and agencies to
keep the database accurate and up to date;
o Increase outreach activities with non-State agencies so that all
relevant agencies with an overseas presence can discuss and share
information on rightsizing initiatives on a regular and continuous basis;
and
o Require that posts develop action plans to transition to and meet the
agreed-upon outcomes of their rightsizing reviews. This could include
developing milestones for posts reaching agreement on streamlining and
eliminating duplicative functions.
We provided a draft of this report to State for comment. State indicated
that it has either recently implemented or is taking steps to implement
all of our recommendations. We received technical comments from State and
the Departments of Homeland Security, the Treasury, Defense, Justice, and
USAID, which we have incorporated throughout the report, where
appropriate.
Background
The U.S. government maintains more than 260 diplomatic posts-including
embassies, consulates, and other diplomatic offices-in about 180 countries
worldwide. In addition, according to various estimates, there are over
66,000 personnel overseas, including both U.S. direct hires and locally
employed staff under chief of mission authority,5 representing more than
30 agencies and government entities. Agencies represented overseas
include, among others, the Departments of Agriculture, Commerce, the
Treasury, Defense, Homeland Security, Justice, and State and USAID.
According to the Office of Management and Budget, the average cost across
all agencies of having one U.S. direct hire overseas for 2007 is $491,000,
including direct and indirect personnel costs as well as support costs
such as security, office leases and furnishings, and field travel.6
According to State's Bureau of Resource Management, State's average cost
of having one U.S. direct hire overseas for 2007 is approximately
$400,000.
The White House, Congress, the Office of Management and Budget, and our
own agency have emphasized rightsizing as a key initiative to ensuring
that the overseas presence is at an optimal and efficient level to carry
out foreign policy priorities. The President's Management Agenda has
identified rightsizing as one of the administration's priorities.7 The
agenda stipulates that all agencies with an overseas presence should
integrate rightsizing into their workforce plans and reconfigure overseas
staff allocations to the minimum amount necessary to meet U.S. foreign
policy goals. Figure 1 illustrates the various levels of involvement in
U.S. government overseas rightsizing.
Figure 1: Levels of Involvement in Overseas Rightsizing
In fiscal year 2004, Congress mandated the establishment of the Office of
Rightsizing within State.8 The office was directed to lead State's effort
to develop internal and interagency mechanisms to better coordinate,
rationalize, and manage the deployment of U.S. government personnel
overseas, under chief of mission authority. The Office of Rightsizing
reviews and approves rightsizing reports for all capital construction
projects for new embassy compounds or facilities, as well as the staffing
composition of 20 percent of all U.S. missions annually, so that each
mission is reviewed once every 5 years. According to the Office of
Rightsizing, without an approved rightsizing report based on these
reviews, the Office of Management and Budget will not forward to Congress
a programming notification for construction.
In addition to the Office of Rightsizing, a number of entities within
State at the Washington, D.C. and post levels are involved in initiatives
and efforts related to rightsizing. State's regional bureaus are involved
with posts' rightsizing reviews as well as the administration of regional
service centers.9 In addition, State's Bureau of Overseas Buildings
Operations is responsible for the worldwide overseas buildings program for
State and the U.S. government community serving abroad under chief of
mission authority. The Bureau of Overseas Buildings Operations is
directing an expanded new embassy construction program to provide safe,
secure, and functional work places for the diplomatic and consular
missions overseas. At the post level, the Chief of Mission is responsible
for the security and safety of every U.S. government and foreign national
employee at the mission.10 The precise structure of a mission is
determined by the Chief of Mission through the National Security Decision
Directive 38 (NSDD-38) process, which provides authority for the Chief of
Mission to determine the size, composition, or mandate of personnel
operating at the mission.11 See figure 1 for a depiction of the Chief of
Mission's involvement in the rightsizing process.
The operation of embassies and consulates overseas requires basic
administrative support services for overseas personnel. The management
section, which is normally headed by a management counselor or officer, is
the section responsible for overseeing the administrative functions at a
post and generally serves as the recipient of requests from Washington,
D.C., pertaining to staffing and rightsizing. Administrative support
services at posts are generally provided through the State-managed
International Cooperative Administrative Support Services (ICASS) system,
which provides more than 30 services-including financial management
vouchering, human resources, travel services, housing, vehicle
maintenance, and motor pool-with costs of the services divided among the
agencies and sub-agencies with staff at the post, based on the level of
ICASS services used.12
Cost Sharing and New Embassy Compounds
To address the security and other deficiencies of overseas embassies,
consulates, and other buildings, Congress established an interagency
Capital Security Cost Sharing Program to generate almost $18 billion over
a 14-year period to accelerate the construction of approximately 150 new,
secure, and functional embassy and consular compounds.13 The main
objectives of the program are to generate funds for new embassy compound
construction and to encourage State and other agencies to rightsize their
staff by requiring that all agencies with an overseas presence bear some
of the costs for building construction.14 Capital security cost sharing is
based on the total number of existing or authorized positions that an
agency has overseas in U.S.-government-owned or leased facilities, as well
as any projected staff growth positions. Cost sharing is also based on the
type of space occupied by post personnel.15 Charges are being phased-in
over 5 years with the fiscal year 2005 per capita charges being 20 percent
of the fully phased-in amount and fiscal year 2009 per capita charges
representing the full amount.16 Table 1 illustrates the fully phased-in
per person charges for Capital Security Cost Sharing.
Table 1: Full Capital Security Cost Sharing Charges Based on Type of Space
in Embassy or Consulate
Type of space Cost per person
Principal officer $186,886
Controlled access area $50,724
Non-controlled access area $20,488
Non-office space $3,546
Source: Bureau of Overseas Buildings Operations.
Accurate Data on Personnel Overseas Not Yet Available; U.S. Government
Rightsizing Efforts Under Way
Almost 5 years into the President's Management Initiative on rightsizing,
the U.S. government does not yet have accurate data on the size and
composition of the U.S. overseas presence at embassies and consulates;
however, State is working on a unified database which, if periodically
updated by posts, should provide an accurate depiction of the overseas
presence. Several agencies have undertaken efforts to examine and adjust
their staffing configurations, which have been driven by various factors,
such as congressional mandates; the rising costs of building new, secure
embassy buildings; and other shared costs.
Accurate Data on Size and Composition of the U.S. Overseas Presence
Currently Unavailable
According to State officials, there is not yet an accurate picture of the
size and composition of the U.S. overseas presence at embassies and
consulates. In order to be able to make informed staffing and rightsizing
decisions, and conduct accurate analysis of overseas staffing changes, it
is important that the U.S. government have an accurate account of all
overseas positions under chief of mission authority. Moreover, accurate
staffing data is needed to assess each agency a fair share of the cost of
the embassy construction program. Depending on the data's source and time,
estimates of the total overseas presence under chief of mission authority
run from 66,000 to about 69,000 American and non-American personnel, such
as locally employed staff, from more than 30 agencies.17 In addition,
State estimated that there are approximately 78,000 U.S. government
positions overseas, as of December 2005.18 Some of these positions have
been eliminated or are in the process of being eliminated or reconciled,
according to an Office of Rightsizing document. Further, according to
State's estimates, there are almost 22,000 direct-hire American positions
overseas. Figure 2 provides the estimated percentage breakdown of the
total American positions overseas under chief of mission authority by the
key agencies, according to the Office of Rightsizing.
Figure 2: Estimated Percentage of American Positions Overseas under Chief
of Mission Authority by Agency, December 2005
Note: Percentages do not add up to 100 due to rounding.
According to State officials, State has faced various difficulties in
developing accurate data. For example, overseas staffing information is
recorded in a number of different databases at a post, depending on the
purpose of the information.19 In addition to the databases from
Washington, D.C., posts have created their own databases, resulting in
information not being uniform from post to post. Moreover, a State
official reported that some agencies have failed to provide human
resources data to individual posts. State officials added that changes
made in one database do not automatically populate others. Therefore,
posts need to make changes in a number of databases in order to ensure a
full updating and, in particular, to ensure the new information will show
up accurately at State headquarters. As a result, State's numbers might
include positions that have been eliminated or are vacant; or some
positions might be entered more than once.
Officials in the Office of Rightsizing also said that there are large
numbers of employment categories overseas and that each agency might
categorize its personnel overseas in a different manner or use different
methodologies. They pointed out that, in some cases, agencies hire and
count employed family members as U.S. direct hires while, in other
instances, employed family members are counted as locally employed staff.
They further explained that State's current databases have not kept pace
with changes in nomenclature. For example, although new agencies and
components were established as part of the formation of the Department of
Homeland Security, overseas positions might still appear in databases, for
example, as part of the old Immigration and Naturalization Services. The
incorrect reporting of staff positions could create problems for agencies,
such as being incorrectly charged for positions under Capital Security
Cost Sharing, according to non-State officials.
Since 2004, State has required posts to utilize the Post Personnel
database to account for overseas staffing positions for both American
personnel and locally employed staff, according to the Office of
Rightsizing. The Executive Director of the Bureau of Human Resources told
us that, if used properly, this database has the potential to provide the
staffing data that could lead to accurate overseas staffing numbers.
However, officials in the Office of Rightsizing stated that the database
is only as complete as the information that the posts enter into it, and
that some posts might not fully understand how to use the software
properly. The Executive Director of the Bureau of Human Resources
indicated that his bureau has been developing training modules to educate
post officials on using the Post Personnel database correctly.
State Developing Unified Staffing Accounting System
State's Office of Rightsizing has been working with the Bureau of Human
Resources to develop an improved database that will enable State to
present a more accurate picture of all personnel and agencies assigned
overseas under chief of mission authority. According to the Office of
Rightsizing, the improved database will result in one complete and
accurate database of all U.S. government agencies overseas and will
eliminate the need for multiple requests to posts to update staffing data.
State has been working toward making the Post Personnel database
application the exclusive database for the entry of all staffing
information at posts. In addition, State has been devising standardized
organizational codes for post personnel for all agencies overseas.
According to State officials, the Post Personnel database will be linked
to other existing applications and will populate a number of other
databases, including Post Profiles, ICASS, and the Bureau of Overseas
Buildings Operations database for Capital Security Cost Sharing, thus
eliminating potential errors associated with duplicative and incorrect
entries.
The Office of Rightsizing reported that the data in Post Personnel will
soon be made available to agencies with an overseas presence so that they
can verify it regularly to ensure consistency. Non-State agency officials
expressed the need for transparency in overseas staffing data since they
contended that often the data inputted at posts was not verified by them.
The Executive Director of the Bureau of Human Resources expressed concern
that there needs to be some type of accountability mechanism in place that
ensures posts are inputting information regularly and accurately into Post
Personnel. He added that without a mechanism in place, the quality and
validity of the data will be in question. State officials said that the
integrated staffing database is scheduled to be completed and operational
by fall 2006. However, State has not provided guidance to posts that
ensures staffing information in the Post Personnel database will be
continuously updated or that outlines the accountability mechanisms for
ensuring that staffing information is complete, according to a State
official.
Agencies Rightsizing Efforts Lead to Increases or Decreases in Staff
Over the past several years agencies with an overseas presence have
undertaken initiatives to assess their overseas staffing configurations.
Several agencies reported that they have added staff overseas as a result
of new mission requirements, and others reported that they have relocated
or reduced their personnel to better meet mission needs and respond to the
rightsizing efforts. Many agency officials with whom we spoke indicated
that they have conducted comprehensive internal reviews or hired
consultants to assess their overseas programs and workload. For example,
the Department of Agriculture recently completed a global rightsizing
review and found that the department is overstaffed in some countries and
understaffed in others. As a result, the Foreign Agricultural Service is
repositioning its personnel to better accomplish organizational goals. In
addition, Department of Homeland Security officials indicated that they
have been working to fully assess their overseas presence and to identify
redundancies within the various Department of Homeland Security components
overseas. State also recently announced plans for the global repositioning
of its overseas presence, which entails moving hundreds of positions
across the world-primarily from Washington and Europe to critical missions
in regions such as Africa, South and East Asia, and the Middle East.
Rightsizing Efforts Driven by Security and Administrative Costs
Some agency officials said that their decisions on the numbers of overseas
staff needed are guided by a number of factors, including congressional
mandates, mission requirements, and budget constraints, including Capital
Security Cost Sharing and ICASS costs. Officials with whom we spoke with
at several agencies said that they have increased staff overseas as a
result of the global war on terror, border security activities, and
efforts to combat drug trafficking and weapons of mass destruction. For
example, officials in the Department of Justice said that the department's
various components have increased their overseas presence due to these
factors, and, in fact, U.S. Drug Enforcement Administration officials
reported that they increased their presence by almost 10 percent between
2000 and 2005. In addition, Customs and Border Protection officials told
us that they have been increasing their personnel overseas since 2002 due
to requirements for the Container Security Initiative program. While a
number of agencies have been increasing their presence overseas, a few
agencies have decreased or are projected to maintain the current level of
their overseas presence due to cuts in program budgets. For example, the
Foreign Commercial Service reported that it reduced its overseas staffing
levels by approximately 13 percent since the beginning of fiscal year
2001. In addition, Foreign Agricultural Services officials said that their
overseas presence is likely to remain static.
A number of agencies we spoke with cited that costs of overseas
operations, which include increasing Capital Security Cost Sharing program
and ICASS costs, have caused them to examine their overseas presence.20
Department of Commerce officials reported that, while Capital Security
Cost Sharing costs represented 7 percent of their overseas costs in fiscal
year 2006, by fiscal year 2009 the cost is expected to be 21 percent of
the agency's overseas costs. In addition, agency officials said that,
because the Capital Security Cost Sharing costs are based on every
existing or planned authorized overseas position, regardless of whether
the position is filled or not, agencies have effectively been encouraged
to eliminate vacant positions or keep their projected numbers low. For
example, Department of Commerce officials said that costs associated with
Capital Security Cost Sharing has forced the agency to keep its projected
overseas numbers low rather than develop more realistic projections since
program costs are based in part on projected as well as existing staffing
numbers, and they do not want to estimate and pay for positions that might
not be needed in the future. Some agency officials also indicated that
rising ICASS costs have affected their budgets and caused them to
reevaluate their overseas presence. For example, Department of Homeland
Security officials said that because of the high costs of using ICASS,
they are currently reevaluating their use of the services and stressed the
importance of having flexibility to opt out of ICASS services.
Some agency officials with whom we spoke raised several concerns about the
impacts of Capital Security Cost Sharing and ICASS costs on staffing
configurations. For Capital Security Cost Sharing, officials expressed
concern that it is difficult for them to accurately project their overseas
staffing numbers, since potential unforeseen events overseas, such as
natural disasters, could necessitate a reduction or increase in personnel.
Some agency officials expressed concern that, as the Capital Security Cost
Sharing costs increase, they might be priced out of an overseas presence
or have to tap into their program funds to sustain such a presence. Table
2 depicts the Capital Security Cost Sharing charges for fiscal year 2007
that appear in the President's budget for the agencies that we spoke with.
Table 2: Fiscal Year 2007 Capital Security Cost Sharing Charges by Select
Agency
Agency Total chargea
Agriculture Department $8,968,013
Commerce Department 20,678,269
Defense Department 134,893,425
Homeland Security Department 24,052,046
Justice Department 45,635,505
State Department 674,155,851
Treasury Department 2,796,268
USAID 100,349,057
Other 26,594,272
Total $1,038,122,706
Source: Bureau of Overseas Buildings Operations.
aThe total charge includes building costs for each agency's personnel and
ICASS employees that provide services to an agency, as well as rent
offsets. For example, USAID's Capital Security Cost Sharing position total
is $105,653,422, of which $10,737,155 is for ICASS contributions. However,
a rent offset of $16,041,520 reduces USAID's total cost figure to
$100,349,057.
Moreover, in order to mitigate the effects of ICASS fees coupled with
agency budget cuts, some agency officials indicated that officials
overseas are doing more administrative activities themselves, which takes
time away from accomplishing their mission. In addition, agencies have
sought other cost-effective ways of operating overseas, including hiring
family members of staff, hiring local Americans, or utilizing locally
employed staff (this final option has limitations, however). For example,
according to the U.S. Marshals Service, utilizing locally employed staff
over U.S. direct hires has resulted in considerable savings to the agency,
and it estimates that the savings in relocation expenses, foreign housing,
and other foreign entitlements, which direct hires receive but locally
employed staff do not, would exceed $1 million every 3-4 years. However,
agency officials indicated that there are limitations to using locally
employed staff at posts to carry out some duties due to national security
concerns. For example, Department of the Treasury officials said that they
are not able to utilize locally hired foreign nationals to carry out the
work of U.S. direct hires due to the sensitive investigative nature of
their work and privacy laws. In addition, officials in the Departments of
Homeland Security and Justice indicated that, due to the sensitive nature
of their work, they can only allow American citizens with a security
clearance to perform most of their overseas duties. As an alternative to
sending additional U.S. direct hires to posts, some agencies employ
eligible family members of agency staff or hire U.S. citizens already
living in the host country to carry out some of the agency functions.
Department of Homeland Security officials explained that utilizing U.S.
citizens living in the host country is much cheaper than sending a U.S.
direct hire to a post because the department does not have to pay benefits
such as housing, school costs, and other allowances to locally hired U.S.
citizens.
State Has Established an Office of Rightsizing, but More Interaction
Needed between Office of Rightsizing and Agencies
In early 2004, State established the congressionally mandated Office of
Rightsizing to primarily coordinate all agency staffing requests,
administer rightsizing and staffing reviews, and work with State entities
and other agencies on rightsizing. The basic mission of the office is to
better coordinate, rationalize, and manage the deployment of U.S.
government personnel overseas, under chief of mission authority. Since its
formation, some of the activities of the office have included coordinating
staffing requests of U.S. government agencies, developing guidance for and
analyzing post rightsizing reviews, and formulating a rightsizing review
plan. Non-State agencies have voiced a number of concerns related to
interactions with the Office of Rightsizing, including their desire to be
more involved in the rightsizing process. To better involve all agencies
in rightsizing efforts and better understand their priorities, the Office
of Rightsizing co-hosted an interagency summit in March 2006.
Office of Rightsizing Established within State
In February 2004, the Office of Rightsizing was established within State.
The roles and responsibilities of the office include coordinating all
agency NSDD-38 requests; administering rightsizing and staffing reviews;
and working with State entities and other agencies on rightsizing,
regionalization, and shared service initiatives. The office started as a
small operation with only a few staff; however, over the past 2 years it
has grown in size. As of early May 2006, the office includes a director,
three NSDD-38 analysts, and three rightsizing analysts. According to State
officials, additional staffing is needed to handle the growing number of
initiatives that the office is involved with. The Director of the Office
of Rightsizing told us that he has requested two additional staff to work
on analyzing rightsizing reviews and compiling rightsizing data, and hopes
that the positions will be filled by summer 2006.
Office of Rightsizing Is Involved in a Number of Initiatives
Since the Office of Rightsizing was established, it has initiated a number
of processes and has been involved in a number of efforts. These efforts
have included administering and analyzing post reviews, formulating a
review plan, developing instructions for post Mission Performance Plans,
automating the NSDD-38 application process, and issuing a number of
quarterly reports summarizing State's rightsizing actions and
accomplishments. In addition, the office has been involved with two State
initiatives on rightsizing, which include demonstrating results achieved
by moving administrative functions away from posts to remote locations;
and eliminating duplicative functions at posts, also known as sharing
support services.
Rightsizing Reviews
One of the principal activities of the Office of Rightsizing has been
administering and analyzing post rightsizing reviews. In 2005, the office
established a formal review process and guidance for all posts overseas,
including new embassy construction projects. The process focuses on
linking staffing to mission goals, eliminating duplication, and promoting
shared services. In fiscal year 2005, about 35 reports were submitted by
posts and analyzed by the Office of Rightsizing. Figure 3 shows the
missions that conducted a rightsizing review in fiscal year 2005,
according to the office. All of these reports pertained to posts scheduled
to have construction projects for a new embassy compound or office
building in the near future.21 According to the Office of Rightsizing, the
final reports that have been analyzed by the office have been or will be
submitted to Congress as State seeks budget appropriations for these
projects. In fiscal year 2006, the office has tasked over 40 posts to
conduct reviews-more than 20 posts for both the fall and spring cycles.
Figure 3: Missions Completing a Rightsizing Review in Fiscal Year 2005
Post Rightsizing Review Plan
The Office of Rightsizing has developed a 5-year plan, which includes the
schedule of when missions will be asked to conduct reviews by fiscal year
(see appendix IV). The plan is largely driven by State's Bureau of
Overseas Buildings Operations' building schedule, but also includes
consideration of posts participating in State initiatives, missions of
highest priority, and countries with multiple missions, according to an
official in the Office of Rightsizing. For fiscal year 2005, all of the
reviews were conducted in anticipation of the post receiving a new embassy
compound or building in the future. For reviews scheduled to be conducted
in fiscal years 2006 through 2009, the yearly schedule dictates that posts
with planned capital projects will generally perform their rightsizing
reviews in the fall of the fiscal year, while those without planned
projects will perform their reviews in the spring. Figure 4 provides
additional information on the review cycle and steps.
Figure 4: Rightsizing Review Cycle and Steps
Rightsizing in Post Mission Performance Plans
The Office of Rightsizing has issued guidance to posts to include
rightsizing statements in their Mission Performance Plans, starting with
the fiscal year 2007 submission.22 The guidance states that the plans must
include a brief discussion of the rightsizing reviews or other rightsizing
initiatives undertaken by the mission and should summarize the results,
resource implications, and actions taken to implement review
recommendations. However, we reviewed nine Mission Performance Plans for
fiscal year 2007 and found that only one post had included discussion of
any rightsizing elements that the post had undertaken. Officials in the
Office of Rightsizing indicated that initially there had not been a
serious effort to push for posts to provide analysis on rightsizing in
their fiscal year 2007 Mission Performance Plans and, as a result, not all
posts have done so. However, they said that there has been more emphasis
by the office to have posts include rightsizing discussions in their 2008
plans. In May 2006, the Director of the Office of Rightsizing reported
that his office is participating in the reviews of the recent Mission
Performance Plans submitted by posts.
NSDD-38 Application Process
The Office of Rightsizing has been working with agencies and coordinating
with Chiefs of Mission at posts on NSDD-38 requests, particularly those
related to new programs. These requests are submitted to the Chief of
Mission for approval of any proposed changes in agencies' staffing
elements at the post. Officials in the office said that they act in an
advisory capacity between the agencies that are looking to establish or
increase personnel at a post and the Chief of Mission to determine if the
function needs to be performed overseas. However, they told us that it is
ultimately the Chief of Mission's decision to accept or deny an agency's
request to send personnel to post. In fall 2005, the Office of Rightsizing
implemented a NSDD-38 Web-enabled application so that agencies can now
submit their overseas staffing requests via the Internet. According to an
Office of Rightsizing document, since the application process is now
standardized online-which ensures that agency NSDD-38 submissions are
correct and complete-Chiefs of Mission at posts can now immediately
consider the submissions.
Quarterly Rightsizing Reports
Since spring 2005, the Office of Rightsizing has published three quarterly
reports that highlight State's overall rightsizing efforts and
performance, as well as summarize the accomplishments and publications of
the office.23 The quarterly reports have also included copies of State
cables sent to posts pertaining to rightsizing related issues, the Office
of Management and Budget's President's Management Agenda rightsizing score
card and summary, as well as the guidance and sample report that the
Office of Rightsizing has sent to posts.24 The Director of the Office of
Rightsizing stated that the quarterly reports are intended to provide both
State bureaus and non-State agencies with an understanding of rightsizing
measures and processes.
State Regionalization Efforts
The Office of Rightsizing is also involved with State's efforts to ensure
that those administrative functions that do not need to be conducted at
posts are carried out from remote locations. According to State officials,
potential advantages to providing support to posts from remote locations
include potential cost savings, enhanced security for American personnel,
and improved quality of administrative support. State currently provides
remote support to many agencies at posts, primarily in the areas of
financial management and human resources, from two dedicated regional
service centers-the Florida Regional Center in Fort Lauderdale, Florida,
and the Regional Support Center in Frankfurt, Germany. In addition, State
also provides remote support of some administrative functions through
partnering arrangements whereby one post with the personnel and expertise
in certain administrative function assists a smaller post. In order to
further expand remote support, State's fiscal year 2006 operational plan,
Organizing for Transformational Diplomacy: Rightsizing and
Regionalization, identifies additional post functions that can be
performed
remotely to minimize the U.S. overseas footprint and reduce costs.25 The
plan focuses on first removing non-location-specific functions-or
functions that could potentially be removed from posts and carried out
either from the United States or a regional center-from critical danger
missions,26 where State officials said it is crucial to have as few
personnel at posts as possible due to security concerns. The plan
envisions eventually removing those functions from all overseas posts. We
provide a more detailed discussion on State's efforts and challenges to
provide support remotely in a separate report.27
State/USAID Shared Support Services
The Office of Rightsizing is also involved with State's efforts to
increase efficiencies in overseas administrative functions by identifying
and eliminating duplicative management support functions among agencies,
as well as overlapping or redundant program functions. Although increasing
efficiencies by streamlining functions applies to all overseas agencies,
State has been working primarily with USAID to reduce the duplication of
overseas support services. In 2004, State, along with USAID, launched
pilot programs aimed at consolidating support functions such as motor
pool, warehousing, residential maintenance, and leasing services at posts
in Jakarta, Indonesia; Phnom Penh, Cambodia; Cairo, Egypt; and Dar es
Salaam, Tanzania. The focus of the pilot programs was to determine how
State and USAID could best collaborate to realize significant savings and
improved service quality. However, only one of the pilot posts succeeded
in consolidating all four support functions. According to State, the
pilots have established that significant operational efficiencies and some
cost savings can be realized through the consolidation of duplicative
services. Since the pilots at the four posts, State and USAID have
identified additional consolidation opportunities. We will provide a more
detailed discussion and evaluation of State and USAID's consolidation
efforts in a report that will be coming out later this year.
Agencies Cite Limited Interaction with Office of Rightsizing; More
Coordination Under Way
One of the responsibilities of the Office of Rightsizing is to coordinate
and manage interagency rightsizing initiatives. However, during our
discussions with non-State agencies in late 2005 and early 2006, a number
of agencies with an overseas presence told us that they had limited
interaction with State's Office of Rightsizing on matters aside from
NSDD-38 requests. Furthermore, some non-State agency officials told us
that they were not aware of the rightsizing mandate or guidance provided
to posts by the Office of Rightsizing. According to the Director of the
Office of Rightsizing, his office has made an effort over the last couple
of months to visit or talk with many of the agencies with an overseas
presence. However, we found that, in some cases, the pertinent offices
were not reached. For example, officials in Department of Homeland
Security's U.S. Citizenship and Immigration Services told us that State
entities tend to coordinate through one office and do not reach the
various entities within the department. Both U.S. Citizenship and
Immigration Services and Customs and Border Protection officials indicated
that they would like to be included in any discussions that State, in
particular the Office of Rightsizing, has with the Department of Homeland
Security, and suggested that State designate a focal point within each
Department of Homeland Security office with an overseas presence. The
Office of Rightsizing indicated that the Department of Homeland Security
requested that it coordinate through the department's Office of
International Affairs. It is important that agency components are
receiving the necessary information to ensure that rightsizing efforts are
understood. The Department of Homeland Security and the Office of
Rightsizing share responsibility for developing a mechanism to get this
done.
Furthermore, during our discussions with agency officials in late 2005 and
early 2006, non-State agencies indicated that they would like more
transparency in the rightsizing review process. For example, some agencies
told us that they would like to know the outcomes of the reviews at each
post and know ahead of time when posts will be conducting reviews.
Moreover, some agency officials stated that they are looking for an
overall U.S. government strategy or vision from the Office of Rightsizing
so that, as they move ahead on their own rightsizing planning and efforts,
they will be in line with what the Office of Rightsizing is planning.
Finally, some non-State agency officials indicated that, in order to be
able to contribute to the process, they would like to see more clearly
stated standards and unified processes that relate to rightsizing at
posts. For example, officials said that they would like to understand how
posts determine the number of staffing positions available at any given
time and would like to ensure that the requests for information coming
from Washington, D.C., to posts are more consistent.
State Holds Rightsizing Interagency Summit
In order to address rightsizing in context with non-State agencies'
agendas and priorities, the Office of Rightsizing and the Office of
Management and Budget co-hosted an interagency summit in early March 2006.
According to the Office of Rightsizing, participants included
representatives from a number of foreign affairs and non-foreign-affairs
agencies; discussions focused on key initiatives coordinated and managed
by State, such as consolidation of duplicative functions, rightsizing
reviews, the NSDD-38 process, and State regionalization efforts.
While some officials from State's regional bureaus feel that having an
interagency conference is a good start at getting all agencies involved
with rightsizing, they believe that additional interagency dialogue is
needed. In addition, some non-State agency officials told us that the
interagency summit did not provide them with a sense of a strategy for how
they should move forward with their own rightsizing plan to make sure that
it does not conflict with State's rightsizing efforts. Moreover, in the
course of our structured interviews, 7 out of 20 management officers
identified the need for interagency involvement and agency "buy-in" at the
Washington, D.C., and post level to ensure that rightsizing can move ahead
at each post. For example, one management officer with whom we spoke said
that he would like to see a firm, written commitment from other agency
headquarters, other than State, that consolidation of services is in the
best interest of every agency and is expected of posts overseas. One post
noted in its rightsizing report that the success of posts' rightsizing
studies is closely linked to interagency efforts to agree on initiatives
to maximize efficiency at posts. In addition, another management officer
with whom we spoke said that it would be helpful to have interagency
guidance on what to do when eliminating duplicative services results in
overall savings to the U.S. government, but increased costs to an agency,
at the post level.
Some non-State agency officials said that it would be beneficial to have
more frequent interagency meetings or summits, rather than just once a
year. For example, a USAID official said that having an interagency summit
before each rightsizing review cycle starts-one in the fall and another in
the spring-could help inform non-State agencies of rightsizing changes and
activities at posts that effect their agency overseas. The Director of the
Office of Rightsizing told us that, while there are no immediate plans to
hold more frequent interagency summits involving all agencies with an
overseas presence, he plans to continue holding a rightsizing summit
annually. The Office of Rightsizing also reported that it plans to
implement a Washington, D.C.-based forum whereby officials from foreign
affairs agencies, such as the Department of Commerce, USAID, and the
Department of Agriculture, can meet regularly to share information on
programs and ensure that there is a greater consistency in the information
coming from headquarters. The Director of the Office of Rightsizing told
us that the office could be doing more with other non-State agencies to
address rightsizing issues at posts, particularly on the issue of
consolidation of functions, but would first like to address issues raised
as part of the joint State-USAID shared services efforts.
Office of Rightsizing Initiates Rightsizing Reviews, but Reviews Have Not
Realized Full Potential
Post rightsizing reviews are a key element of State's rightsizing efforts.
These reviews are designed to link post staffing to the mission's goals,
eliminate unnecessary duplication, and encourage shared services between
agencies at posts. Our analysis of the first round of the reviews showed
that there was limited guidance to posts and that there was not a
systematic process for how the posts structured their reviews, though
State improved its guidance for the second round of reviews. In reviewing
the first and second rightsizing cycles, the Office of Rightsizing
reported over $150 million dollars of cost savings or avoidance based on
the result of their analysis of the reviews. Posts used a variety of
methods to conduct their rightsizing reviews. Some management officers
with whom we spoke identified various challenges in conducting their fall
2005 reviews and ensuring that their post is rightsized. Additionally, the
Office of Rightsizing did not consider the need for posts to conduct a
cost analysis as part of their reviews. It is unclear how the rightsizing
review decisions, such as elimination of duplicative functions, will be
implemented at each post, according to officials at post and in State's
regional bureaus.
Rightsizing Review Structure and Guidance Have Evolved
In October 2004, the Office of Rightsizing began instructing overseas
missions scheduled to receive a new embassy compound to perform
rightsizing reviews. The reviews are intended to eliminate or justify any
duplicative or parallel functions at posts and consider the possibility
for reducing U.S. government employees at posts through such means as
remote services, more utilization of locally employed staff, and
outsourcing. Between late 2004 and summer 2005, about 35 posts
participated in the first cycle of reviews, and the office conducted
formal analyses of the posts' reviews in late 2004 and early 2005. The
Office of Rightsizing reported over $50 million in costs saved or avoided
to the U.S. government based on its analysis of the first cycle of
reviews. Based on the analysis that the Office of Rightsizing conducted of
post reviews representing eight new embassy compounds, the average
reduction in desk positions for each project was 18, which resulted in 145
desk reductions overall.28 The office identified many of the removed desk
positions in cooperation with posts and regional bureaus. According to the
Office of Rightsizing, these desks represent significant partially or
fully avoided costs. Of the 145 reduced positions, 50 were U.S. direct
hires. Assuming an average saving of $400,000 per year for each position,
the office estimated that these 50 positions represent as much as $20
million in potential costs avoided.29 Furthermore, the office stated that
the desk positions removed represented approximately an additional $20
million in savings to the Bureau of Overseas Buildings Operations in
capital security construction costs, as well as approximately $18 million
in savings due to not needing to build separate annexes in three cases.
The actual cost avoidance achieved will depend upon whether offsetting
costs can be avoided and whether recommended staff reductions are
implemented.
However, based on our analysis of 20 out of about 35 rightsizing reviews
that were part of the spring 2005 review cycle, we observed that there was
not a systematic approach for how the posts structured their reports or
how the Office of Rightsizing evaluated them. For example, the information
presented within the reports varied from post to post, and the rightsizing
elements that the posts evaluated and reported were not consistent. Some
posts provided narratives discussing various rightsizing elements, such as
outsourcing and post security, while other posts did not. Furthermore, we
found that none of the posts showed that they had conducted a cost
analysis as part of the post's rightsizing efforts. In addition, we found
that the Office of Rightsizing did not have a systematic process to
quantify costs saved or avoided as a result of post staffing reductions
stemming from reviews in the spring 2005 cycle. The Director of the Office
of Rightsizing agreed that the office needs to implement a systematic
process of collecting data and determining cost savings and cost avoidance
for future rightsizing cycles, and has asked the rightsizing analysts in
the office to document the positions that are eliminated or costs saved
due to posts taking rightsizing measures into consideration. Finally, we
also found that, although the goal of the President's Management Agenda
and the Office of Rightsizing is to limit the overseas presence to the
minimum level necessary to accomplish the U.S. government's mission,
overseas staffing is increasing. Our analysis of the 20 reviews from the
spring 2005 cycle revealed that net staffing numbers will increase for 15
posts. Increased levels in staffing abroad can be attributed to
high-priority national security interests, such as the global war on
terror, anti-narcotics efforts, and HIV/AIDS projects, which have
implications on U.S. staffing and space at posts abroad, according to the
Office of Rightsizing as well as post management officers.
The Director of the Office of Rightsizing agreed that the first round of
reviews was not conducted systematically, and said that the process and
format has evolved since the initial guidance was provided to posts for
the spring 2005 cycle. In particular, based on feedback from posts that
participated in the spring 2005 review cycle, the Office of Rightsizing
changed the guidance to be more systematic for the fall 2005 cycle. All
management officers that we interviewed at 20 posts which had conducted a
review as part of the second cycle in fall 2005 stated that the guidance
was either very useful or moderately useful, and several commented that
the guidance was clear, succinct, and easy to discern. Table 3 below
specifies the elements that the fall 2005 cycle posts were asked to
address when completing their reviews.
Table 3: Summary of Required Sections of Post Rightsizing Reviews,
September 2005
Section Description
Mission goals and For each mission goal, identify the resources
objectives currently supporting that goal, and analyze the
post's specific achievements in meeting the
objectives.
Duplicative activities Assess areas of duplication, activities which are
no longer required or may require adjustment of
resource levels, and identify activities which
require increased resources to achieve their
objectives.
Alternate sourcinga Identify all services which are currently
outsourced including services that are contracted
by the embassy, such as local guard services,
vehicle maintenance, janitor services, gardening
services, etc.
Regionalized services Identify all activities that are performed by
regional or U.S. based government personnel such
as financial management and human resources
services.
Substitution of locally Identify U.S. direct-hire positions for which
employed staff for U.S. locally employed staff may be substituted.
direct-hire positions
Current and projected Complete the summary staffing table, including all
staffing sections and/or agencies, showing current staffing
levels, projected staffing levels, and the net
change.
Long range overseas For posts receiving a new embassy compound,
buildings plan staffing complete the Long Range Overseas Buildings Plan
projectionsb spreadsheet, which should include a count of all
projected staff, American and locally employed
staff, desk and non-desk, controlled access areas
and non-controlled access areas. For posts not
receiving a new embassy compound, use the Capital
Security Cost Sharing spreadsheet and add or
reduce positions accordingly.
ICASS service matrix Complete the ICASS service matrix which should
clearly show which services are provided to which
agencies, and which are not.
Source: Office of Rightsizing.
Seventeen of the twenty management officials with whom we spoke who
conducted a rightsizing review in fall 2005 said that the review helped
them better understand how post personnel meet mission objectives. When
asked whether they had additional comments, several management officers
stated that they found the review at their post to be a useful exercise.
For example, a management officer posted in Eurasia stated that the review
was an interesting and useful process, which helped the post focus on
parts of the Mission Performance Plan that they would otherwise not have
concentrated their efforts on. The Office of Rightsizing reported over
$100 million in costs saved or avoided to the U.S. government based on
their analysis of the fall 2005 cycle of reviews. The estimate was based
on an analysis that the Office of Rightsizing conducted of post reviews
representing 21 missions. According to the office, its rightsizing efforts
for the fall 2005 cycle will result in a potential reduction of 683 total
desk spaces in new embassy compounds, of which 170 are U.S. direct hires.
The Office of Rightsizing estimated that each eliminated U.S. direct-hire
position would result in a cost avoidance of about $400,000. The actual
cost avoidance achieved will depend upon whether offsetting costs can be
avoided and whether recommended staff reductions are implemented. In
addition, the Office of Rightsizing reported that the rightsizing actions
for the fall 2005 cycle have resulted in approximately $90 million in
savings to the Bureau of Overseas Buildings Operations in capital security
construction costs, which includes cost saved by not needing to build four
annexes. Although we have not been able to independently assess the Office
of Rightsizing's estimates, it has presented evidence that some major cost
avoidance and cost savings have occurred. Figure 5 illustrates the posts
from the fall 2005 review cycle where we interviewed officials as part of
our analysis.
Figure 5: Fall 2005 Cycle Posts GAO Interviewed
Approach to Conducting Rightsizing Reviews Varies by Post
Posts used a variety of means to conduct their reviews. The approach used
by 19 of the 20 posts (all of which were included in the fall 2005 review
cycle where we interviewed officials) incorporated the participation of
the post management officer, Deputy Chief of Mission, or both. The Office
of Rightsizing suggested that posts, in conducting rightsizing reviews,
use the ICASS Council, working groups, or any ad hoc arrangement as a
vehicle for discussion and formulation of the report and corresponding
data. In addition, the Office of Rightsizing instructed posts to include
all State and non-State agencies, constituent posts, and embassy offices
in the posts' rightsizing analyses. However, posts took diverse approaches
to carrying out their reviews. Some posts conducted their reviews using
rightsizing committees, and others directed their review to existing goal
oriented discussion groups such as those that created the post's Mission
Performance Plan.
The Office of Rightsizing also offered posts the opportunity to
participate in digital video conferences to answer any questions that they
had about the review. However, officials at 13 of the 20 posts mentioned
above stated that they did not participate in a video conference with the
office. Management officers said that their posts did not participate
because, among other reasons, they did not find it necessary; other posts
did not have the technological capabilities to participate. Moreover,
several posts did not participate in a digital video conference because
officials did not think that the Office of Rightsizing required it.
Nonetheless, the Director of the Office of Rightsizing stated that he
found that those posts that took advantage of this option had more success
with their rightsizing reviews; thus, starting with the spring 2006 cycle,
the office will require that every post participate in a conference. He
also stated that he hopes other non-State agencies will participate in
video conferences as posts conduct their rightsizing reviews. Moreover,
State, as well as the Office of Management and Budget, expects all
agencies at each post to understand that rightsizing is government-wide
and not just a State-oriented process. In the course of our structured
interviews, 7 out of 20 management officers identified the need for
interagency involvement, including agency "buy-in" to ensure that
rightsizing can move ahead at each post. For example, a management officer
in Europe stated that it would be very helpful if there was a one-page
summary that non-State agency officials at each post received from their
headquarters in Washington, D.C., that describes what they need to do as
part of the rightsizing review. However, we found that the Office of
Rightsizing provided posts with very little guidance on interagency
participation.
The Director of the Office of Rightsizing stated that he also encourages
posts to utilize the resources and knowledge within the office and
recommends that posts, as they conduct the review, share sections of it
with the office for feedback. The posts participating in the fall 2005
cycle generally took this approach, as 13 of 20 posts reported that they
shared sections of their report with the office during the review process.
The Office of Rightsizing also indicated that this approach may lead to
more expeditious approval of reviews and that they will therefore strongly
recommend that posts participating in the spring 2006 rightsizing cycle
share sections of their report prior to final submission. Additionally, 15
management officers we interviewed stated that sharing best practices with
other posts through online forums or receiving a visit from an expert to
help guide the post through the rightsizing review process would be very
useful for enhancing the rightsizing review process.
Posts Identified Challenges in Conducting Rightsizing Reviews
A number of management officers identified various challenges in
conducting the reviews at their post, including resistance by non-State
agencies at posts to address rightsizing measures. Another challenge
mentioned was a lack of direction and opportunities for regionalization
and outsourcing of services. In addition, overlapping data requests from
agencies' headquarters, as well as redundant personnel databases,
complicated the review process.
Resistance by Non-State Agencies at Posts
Several posts that conducted a fall 2005 rightsizing review stated that
they encountered resistance from non-State agencies when trying to obtain
interagency involvement during the process. Specifically, four post
management officers stated that other agencies were not receptive to the
request to conduct a rightsizing review. According to a management officer
posted in Europe, non-State agencies at the post did not want to share
information on future staffing numbers for the review. The management
officer added that there was a lack of recognition by agencies that
rightsizing was not just a State initiative, but a government-wide
initiative. Moreover, some management officers explained that they had
difficulties in getting agencies to buy into the rightsizing review
process and faced interagency resistance regarding the consolidation of
post services. Consolidation of services proved to be a common challenge
at posts, as 14 of the 20 management officers we interviewed identified
duplication of post services or programs, such as motor pool and
cashiering, as a result of the rightsizing review. Although these posts
have identified duplicative services or programs, 10 of 20 management
officers stated that the post has not taken action on consolidating the
services and programs. According to management officers, common reasons
why some posts have not yet consolidated these duplicative functions is
because they are waiting to merge their functions once they move into
their new embassy compound or because the agencies at the post could not
come to an agreement about consolidation. For example, a management
officer posted in Africa stated that USAID headquarters provided its staff
at the post with conflicting instructions about retaining duplicative
administrative support services, which countered the ongoing efforts to
eliminate duplicative services at the post.
Posts Lack Direction and Opportunities for the Regionalization and
Outsourcing of Services
Several posts that participated in the spring and fall 2005 cycle of
reviews stated that they lacked direction and opportunities for the
regionalization and outsourcing of services. The guidance for the
rightsizing review requested posts to consider regionalization options.
However, while 18 of 20 posts we interviewed stated that they rely on
regional support services to meet posts' needs, a few management officers
indicated that they found it difficult to consider all regionalization
options without having a base understanding of what regional services are
available. For example, management officers posted in Asia and Africa
stated that they lack information on what types of regional support could
be provided remotely and how to access that support. Another management
officer in Eurasia stated that posts should be provided a baseline listing
of services so that post officials have a good sense of which services are
available regionally.
Though posts were instructed to assess outsourcing possibilities within
their reviews, several posts that participated in the spring 2005 cycle of
rightsizing reviews reported that outsourcing of services is not a good
alternative due to the lack of choice, quality, and sophistication in the
marketplace. Another management officer posted in Asia, whose post
participated in the fall 2005 cycle of reviews, stated that outsourcing is
a concept that the post is not accustomed to using and that the
rightsizing review led them to examine which post functions can be
outsourced. To ascertain current outsourced functions at posts, State's
Office of Global Support Services and Innovation administered an
outsourcing survey to which 119 posts responded. According to the survey
results, the services most likely to be outsourced were copier maintenance
as well as packing and shipping, while those services least likely to be
outsourced were procurement, property management, and phone billing.
Officials at the Office of Global Support Services and Innovation stated
that the results of the survey will serve as the Office of Rightsizing's
baseline for outsourcing.
Rightsizing Reviews Overlap with Additional State Data Requests
All of the management officers we interviewed stated that, within the last
2 years, they have received other requests or reviews from agency
headquarters seeking information similar to that requested for the
rightsizing review. Ten of twenty management officers we interviewed
identified the Mission Performance Plan as another headquarters request
for information similar to that of the rightsizing review, and several of
these posts indicated that there was a high degree of overlap between
these two data requests. Moreover, more than half of the management
officers indicated that there was a high or moderate degree of overlap
between the rightsizing review and other requests from the Bureau of
Overseas Buildings Operations, such as the Capital Security Cost Sharing
Program and the Long Range Overseas Buildings Plan data requests.
As explained by several posts, it was difficult to complete and keep track
of all of these overlapping data requests given the limited resources at
each post. For example, a management officer at a post in Africa stated
that it took approximately 3 months to complete the Capital Security Cost
Sharing request and approximately 2 months to complete the Mission
Performance Plan, with both requests requiring interagency staff
collaboration. The officer added that the post did not have time to focus
on all of the requests tasked to the post. Another management officer in
Africa stated that the post would have liked to have one database that was
responsive to the needs of all the requests from headquarters. In
addition, 5 of the 20 posts that we interviewed stated that it would be
beneficial to streamline the rightsizing review by including it with other
data and information requests, and, moreover, several management officers
stated that the rightsizing review should draw from information that
currently exists in databases that are centrally located in Washington,
D.C.
The Office of Rightsizing has recognized the need for a single database
and told us that State has been working on developing an integrated Post
Personnel database. According to State officials, this database is
expected to populate all other databases currently maintained by overseas
posts to ensure all databases contain the same information. Furthermore,
Office of Rightsizing officials stated that-once there is one
authoritative database for all staffing data-they will no longer rely on
multiple databases and, therefore, will not have to spend as much time
verifying overseas staffing numbers projected in rightsizing reviews.
Cost Analysis Was Not a Primary Factor in Rightsizing Reviews
The Office of Rightsizing did not consider the need for posts to conduct
cost analyses as an essential supplement to the spring 2005 and fall 2005
reviews. The Director of the Office of Rightsizing stated that he did not
want the post reviews to become a cost cutting exercise, but rather to
focus more on identifying the needed resources to meet the posts' mission
and goals and justify current and projected staffing compositions.
Moreover, he stated that actual cost savings at the post level would be
hard to determine and that sometimes rightsizing requires an increase in
staff.
The guidance for the spring 2005 and fall 2005 rightsizing reviews did not
require posts to evaluate costs or perform cost analyses for the review
process. While none of the 20 post reports we reviewed for the spring 2005
cycle illustrated within their rightsizing report the results of a cost
analysis in association with rightsizing efforts at posts, 11 of 20 posts
for the fall 2005 cycle told us that they conducted some or limited cost
analyses for various post staffing scenarios, such as the outsourcing of
services and substitution of locally engaged staff for U.S. direct-hire
positions. In addition, one management officer stated that the post
conducted an analysis to determine which service provider at the post
would be more cost effective. However, a management officer stated that it
was difficult to perform a comprehensive analysis of the cost
effectiveness of service providers because the post did not have
comparable data for each provider. Moreover, another management officer in
Asia stated that the post's cost analysis was not comprehensive because
post staff did not have the necessary expertise to conduct such an
analysis. Moreover, a management officer added that the post would need
more guidance if it were to conduct a formal cost analysis with accurate
cost data.
With the upcoming cycles of reviews, the Office of Rightsizing is
increasingly emphasizing the need to consider costs associated with
rightsizing. For example, the Director of the Office of Rightsizing
directed that additional analyses should be undertaken by posts to
determine the overall cost impact to the U.S. government and all customer
agencies before actual consolidation of shared administrative support
services can occur. This analysis should also assess whether the formation
of the single service provider will, over time, be a more viable and
effective option for the U.S. government. The Office of Rightsizing has
not yet provided formal guidance to posts on how to conduct an analysis to
determine the most cost effective service provider, but it is continually
developing its guidance for posts, and in particular, has developed
guidance for a rightsizing competitive sourcing business case analysis,
which is being incorporated into the spring 2006 cycle of reviews.30
Subsequently, all posts will be required to complete this cost module as
part of their rightsizing reviews, according to the Office of Rightsizing.
Implementation of Rightsizing Review Results Unclear
Some management officials we interviewed, as well as officials in State's
regional bureaus, were unclear about the outcomes of the reviews. Although
the reviews are intended to eliminate or justify any duplicative or
parallel functions at posts and consider the possibility for reducing U.S.
government employees at each post, some executive directors in State's
regional bureaus pointed out that there is no implementation plan with
timelines to track rightsizing-related changes that have been identified.
Most executive directors in regional bureaus believe that it should be the
Office of Rightsizing's responsibility to follow-up with posts to ensure
resources have been consolidated in line with rightsized staffing levels,
while one executive director in a regional bureau believes that it should
be both the Office of Rightsizing as well as the bureau's own
responsibility.
The Office of Rightsizing stated that it has informed posts what their
staffing configurations should be as a result of their reviews and that it
is the post's responsibility to carry out corresponding staffing changes.
Furthermore, the office has asked posts to include the distribution of
services and schedules of when consolidation will occur within their
Mission Performance Plans. The office also expects posts to establish
reduction in force plans, which, according to the Office of Rightsizing,
should consider attrition, retirement, and vacant positions. Moreover,
Office of Rightsizing officials stated that they are planning to send a
yearly cable to posts that have already completed rightsizing reviews to
remind them of the need to meet agreed-upon staffing levels and to ensure
that rightsizing action has been taken before the post moves into a new
embassy compound. In early May 2006, the Director of the Office of
Rightsizing told us that, in lieu of sending a cable, his office will be
tasking posts that conducted reviews in the spring and fall 2005 cycles to
develop a rightsizing action plan leading up to the completion of their
new embassy compound. However, as of May 9, 2006, the office has not sent
an action plan tasking to posts.
As the Office of Rightsizing expects posts to develop their own
rightsizing implementation plan, some posts may not adhere to the staffing
figures agreed upon within their reviews. Specifically, some management
officers we interviewed stated that their posts are waiting to move into a
new embassy compound before taking any action to configure their post
staffing numbers. For example, a management officer posted in Asia stated
that the post's plan to configure the staffing numbers as reflected in the
rightsizing review is not connected to any immediate time frame, but
rather will happen when the post moves into the new embassy compound.
Another management officer stated that, because the construction of the
post's new embassy compound has been postponed, and because agencies at
the post have not agreed to the staffing changes made by the Office of
Rightsizing, no immediate post staffing changes are being contemplated. In
addition to a lack of an implementation plan for those posts receiving a
new embassy compound, it is also unclear what approach or incentives the
Office of Rightsizing will use to enforce implementation of rightsizing
measures for those posts not scheduled to receive a new embassy compound.
According to an official in the Bureau of Overseas Buildings Operations,
it is important for posts to have an implementation plan of how they will
reconfigure their staffing, particularly for those posts that will be
moving into a new embassy compound, because the new embassy or consulate
will be built based on the staffing numbers approved by the Office of
Rightsizing for that post.
Conclusion
Progress has been made in implementing the President's Management Agenda
initiative to rightsize the U.S. government's overseas presence at
embassies and consulates. Agencies are generally adjusting their presence
based on mission, security, and cost factors. State is seeking ways to
reduce support staff overseas and overseas posts are conducting
rightsizing reviews required by legislation. Moreover, after a slow start,
State's Office of Rightsizing is beginning to achieve momentum in
coordinating government-wide rightsizing efforts. However, more needs to
be done. Of foremost importance is the need to develop accurate staffing
data with which to measure staffing trends and the effects of rightsizing
activities. We recognize that efforts are currently under way to develop
accurate data; however because of the importance of having accurate data
on overseas staffing and the length of time it has taken to develop this
data, management oversight may be needed to ensure completion of this
task. State's Office of Rightsizing also needs to aggressively reach out
to agencies at the headquarters level, and to overseas posts, to ensure
that the positive initiatives under way are implemented effectively.
Recommendations for Executive Action
To ensure that the U.S. government's overseas presence under chief of
mission authority is accurately accounted for and to ensure that the U.S.
government's rightsizing goals are being coordinated and that posts can
maximize savings and gain efficiencies through rightsizing, we recommend
that the Secretary of State take the following three actions:
o Provide oversight to ensure the timely development and use of a single
database that accurately accounts for U.S. overseas personnel staffing
numbers and has accountability measures to encourage posts and agencies to
keep the database accurate and up to date;
o Increase outreach activities with non-State agencies so that all
relevant agencies with an overseas presence can discuss and share
information on rightsizing initiatives on a regular and continuous basis;
and
o Require that posts develop action plans to transition to and meet the
agreed upon outcomes of their rightsizing reviews. This could include
developing milestones for posts reaching agreement on streamlining and
eliminating duplicative functions.
Agency Comments and Our Evaluation
We provided a draft of this report to State for comment. State's comments,
along with our responses to them, can be found in appendix V. State
indicated that it has either recently implemented or is taking steps to
implement all of our recommendations.
We received technical comments from State, the Departments of Homeland
Security, the Treasury, Defense, and Justice and USAID, which we have
incorporated throughout the report, where appropriate. In addition, the
Department of Justice stated that it endorses our recommendation that
State continue to expand its outreach to agencies and departments with an
overseas presence to enhance discussion and information sharing on
rightsizing initiatives. Furthermore, the Department of the Treasury
stated that it would be helpful if agencies with personnel at posts
developing rightsizing action plans have the opportunity for their
personnel to participate in the rightsizing reviews and the development of
the action plans.
As agreed with your office, unless you publicly announce the contents of
this report earlier, we plan no further distribution until 30 days from
the date of this letter. At that time, we will send copies of this report
to other interested members of Congress, the Library of Congress, and the
Secretary of State. We will also make copies available to others upon
request. In addition, this report will be available at no charge on the
GAO Web site at http://www.gao.gov.
If you or your staff have any questions about this report, please contact
me at (202) 512-4128 or f [email protected]. Contact points for our Offices of
Congressional Relations and Public Affairs may be found on the last page
of this report. Other GAO contacts and staff acknowledgments are listed in
appendix VI.
Sincerely yours,
Jess T. Ford Director, International Affairs and Trade
Appendix I: Scope and Methodology
To ascertain the size of the U.S. government's overseas presence we spoke
with officials in State Department's (State) Office of Rightsizing the
U.S. Government Overseas Presence (Office of Rightsizing) and the
Executive Director of State's Bureau of Human Resources; we also discussed
the limitations that State faces in portraying an accurate number for the
overseas presence. In addition, we spoke with an official in the Office of
Management and Budget to determine the methodology used to report the size
and cost of the overseas presence. To determine the U.S. government's
efforts to rightsize its overseas presence we spoke with officials at a
number of agencies in Washington, D.C., that have a presence at overseas
posts. We spoke with officials from the the Departments of Agriculture,
Commerce, the Treasury, Defense, Homeland Security, and Justice; as well
as officials from the General Services Administration and the U.S. Agency
for International Development. In addition, we reviewed staffing documents
from numerous agencies, reports by State's Office of Inspector General,
and rightsizing documents from State's Office of Rightsizing. We did not
conduct a comprehensive review of each agencies' rightsizing efforts.
We spoke with officials in the Office of Rightsizing about the rightsizing
process and reviewed rightsizing guidance and related documentation. We
reviewed and analyzed nine Mission Performance Plans for fiscal year 2007,
which we were able to obtain from State, to determine whether rightsizing
considerations were reported in the plans. We also spoke with officials in
each State regional bureau-Western Hemisphere Affairs, European and
Eurasian Affairs, African Affairs, East Asian and Pacific Affairs, Near
Eastern Affairs, and South and Central Asian Affairs-to gauge their
involvement with post rightsizing reviews and their interaction with the
Office of Rightsizing. In addition, we spoke with officials in State's
Office of Global Support Services and Innovation about State's initiatives
on regionalization and shared services. To determine costs saved or
avoided as a result of rightsizing exercises, we reviewed cost data from
State's Office of Rightsizing and the Bureau of Overseas Buildings
Operations. To assess the reliability of State's data, we interviewed
officials in the Office of Rightsizing and the Bureau of Overseas
Buildings Operations to ascertain how the data were captured and analyzed
and whether there were any limitations to the data. We determined the data
to be sufficiently reliable for the purposes of our review.
To determine if there was a systematic process for reporting information
in the first cycle of reviews, we reviewed and analyzed 20 out of about 35
rightsizing reviews that were conducted by posts from late 2004 through
summer 2005. The Office of Rightsizing provided us with over 20 reviews
for our analysis. However, we analyzed only those reviews for which we had
received both the post rightsizing review as well as the corresponding
analysis of the review conducted by the Office of Rightsizing. Between
February 2006 and March 2006 we administered 20 structured interviews
regarding post rightsizing review experiences. The interviews were
conducted by telephone primarily with management counselors or officers at
embassies. In one case we spoke with the Deputy Chief of Mission at the
post. The interviews involved 20 of the 22 posts that were part of the
fall 2005 cycle and which had completed their rightsizing reviews by the
time we talked to the post. The posts were located in: Asuncion, Baku,
Bandar Seri Begawan, Bucharest, Bujumbura, Colombo, Harare, Jakarta,
Islamabad, Kiev, Warsaw, Maputo, N'djamena, Pretoria, Reykjavik, Rome,
Santo Domingo, Moscow, Taipei, and Tunis. We did not conduct interviews
with two posts-Monrovia and Ankara-because these posts did not follow
through with our request for interviews.
The structured interview contained open- and closed-ended questions about
guidance, timing, the review process, rightsizing considerations,
headquarters' involvement and feedback, and the impact of the review on
the post. We developed the interview questions based on our review of
rightsizing documentation and discussions with post officials during our
fieldwork in Mexico City and Valletta. We provided an early version of the
questions to the Office of Rightsizing and the Office of Global Support
Services and Innovation for their review and comment, and we also
pretested the interview with three current management officers to ensure
that the questions were clear and could be answered. We modified the
interview questions on the basis of the pretest results and an internal
expert's technical review. We provided the management officers and Deputy
Chief of Mission with the interview questions in advance to allow them
time to gather any data or information necessary for the interview. We
initiated follow-up discussions with 13 posts by telephone. We
subsequently sent posts follow-up questions by E-mail if we were not able
to reach them by telephone. The responses of the structured interviews are
not intended to be representative of all posts. We did not talk with
management officers or look at rightsizing reviews for those posts that
were part of the spring 2006 review cycle.
We conducted fieldwork at the embassies in Mexico City, Mexico, and
Valletta, Malta; and the consulate in Frankfurt, Germany, to gain a better
understanding of the rightsizing process. We chose these posts because
both Mexico City and Valletta had been asked by the Office of Rightsizing
to conduct a rightsizing review as part of the spring 2005 cycle. We chose
to visit Frankfurt because the consulate had conducted an informal
rightsizing exercise in response to a report from State's Office of
Inspector General and because it is a regional hub in Europe. At each post
we met with State officials as well as other agency officials involved in
the rightsizing process to discuss their approach and outcomes of the
review. In addition, we met with the Ambassadors in Mexico City and
Valletta, as well as the Consul General in Frankfurt to understand their
views and involvement in the rightsizing process.
We conducted our work from May 2005 through May 2006, in accordance with
generally accepted government auditing standards.
Appendix II: GAO Reports on Staffing and Operations at U.S. Embassies and Consulates
GAO, Overseas Presence: Observations on a Rightsizing Framework,
GAO-02-659T (Washington, D.C.: May 1, 2002).
GAO, Overseas Presence: Framework for Assessing Embassy Staff Levels Can
Support Rightsizing Initiatives, GAO-02-780 (Washington, D.C.: July 26,
2002).
GAO, Overseas Presence: Rightsizing Framework Can Be Applied at U.S.
Diplomatic Posts in Developing Countries, GAO-03-396 (Washington, D.C.:
Apr. 7, 2003).
GAO, Embassy Construction: Process for Determining Staffing Requirements
Needs Improvement, GAO-03-411 (Washington, D.C.: Apr. 7, 2003).
GAO, Overseas Presence: Systematic Processes Needed to Rightsize Posts and
Guide Embassy Construction, GAO-03-582T (Washington, D.C.: Apr. 7, 2003).
GAO, Overseas Presence: Rightsizing Is Key to Considering Relocation of
Regional Staff to New Frankfurt Center, GAO-03-1061 (Washington, D.C.:
Sept. 2, 2003).
GAO, Embassy Management: Actions Are Needed to Increase Efficiency and
Improve Delivery of Administrative Support Services, GAO-04-511
(Washington, D.C.: Sept. 7, 2004).
GAO, Embassy Construction: Proposed Cost-Sharing Program Could Speed
Construction and Reduce Staff Levels, but Some Agencies Have Concerns,
GAO-05-32 (Washington, D.C.: Nov. 15, 2004).
GAO, Overseas Presence: Cost Analyses and Performance Measures Are Needed
to Demonstrate the Full Potential of Providing Embassy Support Remotely,
GAO-06-479 (Washington, D.C.: May 2, 2006).
Appendix III: GAO Rightsizing Framework and Corresponding Questions
This appendix lists the questions pertaining to mission, security, and
cost that we developed in 2002 to help support rightsizing initiatives for
existing facilities overseas.
Physical/Technical Security of Facilities and Employees
What is the threat and security profile of the embassy?
Has the ability to protect personnel been a factor in determining staffing
levels at the embassy?
To what extent are existing office buildings secure?
Is existing space being optimally utilized?
Have all practical options for improving the security of facilities been
considered?
Do issues involving facility security put the staff at an unacceptable
level of risk or limit mission accomplishment?
What is the capacity level of the host country police, military, and
intelligence services?
Do security vulnerabilities suggest the need to reduce or relocate staff?
Do health conditions in the host country pose personal security concerns
that limit the number of employees that should be assigned to the post?
Mission Priorities and Requirements
What are the staffing levels and mission of each agency?
How do agencies determine embassy staffing levels?
Is there an adequate justification for the number of employees at each
agency compared with the agency's mission?
Is there adequate justification for the number of direct-hire personnel
devoted to support and administrative operations?
What are the priorities of the embassy?1
Does each agency's mission reinforce embassy priorities?
To what extent are mission priorities not being sufficiently addressed due
to staffing limitations or other impediments?
To what extent are workload requirements validated and prioritized, and is
the embassy able to balance them with core functions?
Do the activities of any agencies overlap?
Given embassy priorities and the staffing profile, are increases in the
number of existing staff or additional agency representation needed?
To what extent is it necessary for each agency to maintain its current
presence in-country, given the scope of its responsibilities and its
mission?
Could an agency's mission be pursued in other ways?
Does an agency have regional responsibilities or is its mission entirely
focused on the host country?
Cost of Operations
What is the embassy's total annual operating cost?
What are the operating costs for each agency at the embassy?
To what extent are agencies considering the full cost of operations in
making staffing decisions?
To what extent are costs commensurate with overall embassy strategic
importance, with agency programs, and with specific products and services?
Consideration of Rightsizing Options
What are the security, mission, and cost implications of relocating
certain functions to the United States, regional centers, or to other
locations, such as commercial space or host-country counterpart agencies?
To what extent could agency program and/or routine administrative
functions (procurement, logistics, and financial management functions) be
handled from a regional center or other locations?
Do new technologies and transportation links offer greater opportunities
for operational support from other locations?
Do the host country and regional environments suggest there are options
for doing business differently, that is, are there adequate transportation
and communications links and a vibrant private sector?
To what extent is it practical to purchase embassy services from the
private sector?
Does the ratio of support staff to program staff at the embassy suggest
opportunities for streamlining?
Can functions be reengineered to provide greater efficiencies and reduce
requirements for personnel?
Are there best practices of other bilateral embassies or private
corporations that could be adapted by the U.S. embassy?
To what extent are there U.S. or host country legal, policy, or procedural
obstacles that may impact the feasibility of rightsizing options?
Appendix IV: The Office of Rightsizing's Five-Year Rightsizing Schedule
Table 4 illustrates the 5-year rightsizing schedule, by fiscal year, that
the Office of Rightsizing has developed. The schedule also depicts those
posts that are proposed to receive a new embassy compound (NEC) and the
fiscal year that the facilities are scheduled to be built.
Table 4: Five-Year Rightsizing Schedule
Mission Planned capital projects
Fiscal year 2005
Bosnia and Herzegovina Sarajevo NEC FY06
Burkina Faso Ouagadougou NEC FY07
Congo, Democratic Republic of Kinshasa NEC FY07
Congo, Republic of Brazzaville NEC FY06
Djibouti Djibouti NEC FY06
Ethiopia Addis Ababa NEC FY07
Fiji Suva NEC FY05
Gabon Libreville NEC FY06
Georgia Tbilisi Annex FY06
Indonesia Surabaya NEC FY06
Latvia Riga NEC FY07
Lebanon Beirut NEC FY06
Macedonia Skopje Annex, Warehouse, and
Marine Security Guard Quarters
FY06
Madagascar Antanarivo NEC FY07
Malta Valletta NEC FY08
Mexico Mexico City NEC FY06
Tijuana NEC FY10
Micronesia Interim Office Building FY05
Nigeria Abuja Annex FY06
Norway Oslo NEC FY07
Palau Interim Office Building FY05
Philippines Manila NEC FY07
South Africa Johannesburg NEC FY06
Sudan Khartoum Annex and Marine
Security Guard Quarters FY06
Juba NEC FY07
Yugoslavia Belgrade NEC FY07
Zambia Lusaka NEC FY07
Fiscal year 2006
Algeria
Azerbaijan Baku NEC FY08
Bermuda
Brazil
Brunei Bandar Seri Begawan NEC FY08
Burundi Bujumbura NEC FY09
Chad N'djamena NEC FY09
Chile
Colombia
Costa Rica
Denmark
Dominican Republic Santo Domingo NEC and Annex
FY09
Eritrea Asmara NEC FY09
Finland
Germany
Holy See
Iceland
Indonesia Jakarta NEC FY09
Ireland
Italy Milan MEC FY09
Jordan
Korea Seoul NEC FY09
Liberia Monrovia NEC FY08
Libya Tripoli NEC FY08
Luxembourg
Malaysia
Morocco
Mozambique Maputo NEC and Annex FY08
New Zealand
Pakistan Karachi NEC FY08
Peshawar NEC FY08
Paraguay Asuncion NEC FY08
Poland Krakow NEC FY08
Romania Bucharest NEC FY09
Russia St. Petersburg NEC FY09
Saudi Arabia Jeddah NEC FY08
Riyadh NEC FYa
Dhahran NEC FYa
Singapore
South Africa Pretoria Annex FY08
Sri Lanka Colombo NEC FY09
Switzerland
Taiwan Taipei NEC FY07
Tunisia Tunis Language School FY09
Turkey Ankara NEC FY09
Ukraine Kiev NEC and Annex FY09
United Kingdom
U.S. Mission to the United Nations Agencies
for Food and Agriculture, Rome
U.S. Permanent Mission to the United
Nations Office and Other International
Organizations in Geneva
Zimbabwe Harare NEC and Annex FY08
Fiscal year 2007
Bahamas
Bahrain
Bangladesh
Barbados
Belarus
Belize
Benin Cotonou NEC and Annex FY10
Botswana
Burma
Canada Toronto NEC FY10
Cape Verde
China Guangzhou NEC FY08
Shanghai NEC FYa
East Timor Dili NEC FY10
Equatorial Guinea
Estonia
Grenada
Guinea
Guinea Bissau
Guyana
Hong Kong
India Calcutta NEC FY11
Chennai NEC FY10
Hyderabad NEC FYa
Israel Tel Aviv NEC and Annex FY10
Jerusalem Jerusalem NEC FY10
Kenya
U.S. Permanent Mission to United Nations
Environment Program and United Nations
Center for Human Settlements, Nairobi
Kosovo Pristina NEC FY10
Kyrgyzstan
Lithuania
Malawi
Mali
Mauritania Nouakchott NEC FY10
Mauritius
Mongolia
Nepal
Sierra Leone
Slovak Republic Bratislava NEC FY10
Slovenia
Surinam Paramaribo NEC FY10
Syria Damascus NEC FY10
Tajikistan
Thailand Chiang Mai NEC FY10
Turkmenistan
Uruguay
U.S. Mission to the International Civil
Aviation Organization, Montreal
Vietnam Hanoi NEC FY
Fiscal year 2008
Angola
Argentina Buenos Aires NEC FY11
Armenia
Australia
Belgium
Bolivia
Brazil Rio de Janeiro LFO FY11
Cambodia
Cameroon
Central African Republic Bangui NEC FY11
Cote d'Ivoire
Croatia
Cuba
Czech Republic
Ecuador Guayaquil LFO FY11
France
Gambia
Ghana
Greece Thessaloniki NEC FYa
Guatemala
Laos Vientiane NEC FY11
Lesotho
Moldova Chisinau NEC FY11
Namibia Windhoek NEC FY11
Netherlands The Hague NEC FY11
Netherlands Antilles
Niger
Oman
Panama
Senegal Dakar NEC & Annex FY11
Seychelles
Spain Madrid NEC FY11
Swaziland Mbabane NEC FY11
Tanzania
Togo
Trinidad and Tobago
United Arab Emirates Dubai NEC FY11
U.S. Mission to the European Union
U.S. Mission to the North Atlantic Treaty
Organization
U.S. Mission to the Organization for
Economic Cooperation and Development, Paris
U.S. Mission to the United Nations
Educational, Scientific, and Cultural
Organization, Paris
Fiscal year 2009
Afghanistan
Albania
Austria
Bulgaria
Cyprus
Egypt
El Salvador
Haiti
Honduras
Hungary
Iraq
Jamaica
Japan
Kazakhstan
Kuwait
Marshall Islands
Micronesia
Nicaragua
Niger
Papua New Guinea
Peru
Portugal
Qatar
Rwanda
Source: Office of Rightsizing.
aThe Office of Rightsizing does not yet know the scheduled date of the
capital project.
Appendix V: Comments from the Department of State
The following are our comments on State's letter dated June 9, 2006.
GAO Comments
1.We modified our text to show that, although we have not been able to
independently assess the Office of Rightsizing's estimates, it has
presented evidence to show that some major cost avoidance and cost savings
have occurred.
2.We recognize that State has a standard methodology by which it performs
cost analyses using the International Cooperative Administrative Support
Services software. However, when we talked with management officers at
posts that had conducted a rightsizing review, we were informed that these
posts did not have comparable cost data for each service provider. In
addition, we were informed that the posts did not have the necessary tools
to make informed decisions about how to conduct analysis to determine the
most cost effective service provider.
3.We provided the draft report to State on May 18, 2006. About two weeks
later, State instructed posts to develop implementation action plans. We
believe that the action that the Office of Rightsizing has taken largely
addresses our recommendation. However, until the Office of Rightsizing has
received all implementation action plans with the posts' milestones, due
on July 18, 2006, the office will not know what additional action might
still be needed to ensure that posts meet the agreed-upon outcomes of
their rightsizing reviews.
4.We understand that if a position is eliminated at a post it is not
counted as part of Capital Security Cost Sharing. Our statement was simply
meant to illustrate that eliminated or vacant positions could be reflected
in databases used to count overseas staffing numbers.
5.Our statement reflects non-State agency views. We have amended the draft
by attributing the statement to non-State agency officials. In addition
our statement reflects information we obtained from a February 2006 State
cable to all posts about staffing data and position charges under Capital
Security Cost Sharing.
6.We have modified our text to illustrate the varying estimates of the
size of the U.S. overseas presence. We have received numerous conflicting
estimates on the number of U.S. government officials overseas. One source
estimated that there are approximately 66,000 U.S. government personnel
under chief of mission authority, while another indicated that there are
approximately 69,000. We understand that some of the numbers may come from
different estimates and data sources. State's discussion on staffing data
illustrates the difficulty of obtaining an accurate count of overseas
personnel. We recognize that that there are vacant positions and that the
total number of positions is higher than the number of filled positions.
We also note in our report that State is in the process of eliminating
vacant positions. It is important that State continue to update its
staffing database to ensure that a more accurate accounting of U.S.
government personnel overseas is available.
7.We acknowledge that State has sent several messages since 2004 to posts
instructing them that Post Personnel is the official database for
documenting all U.S. government staffing overseas. However, in February
2006, State reported that not all posts are using Post Personnel as their
main human resources system. In addition, we were told that the guidance
provided to posts did not include accountability mechanisms for ensuring
that the staffing information is updated and complete.
8.It is important that all components of each agency receive information
from the Office of Rightsizing that pertains to rightsizing review efforts
and initiatives. During the course of our work at the Department of
Homeland Security it became clear that certain components within the
department had not received information on rightsizing. We understand that
the Department of Homeland Security has a central focal point that the
Office of Rightsizing works with. The Department of Homeland Security and
the Office of Rightsizing share responsibility in ensuring that agency
components are receiving the necessary information to ensure that
rightsizing efforts are understood. We have modified the text to indicate
that the Office of Rightsizing was asked by the Department of Homeland
Security to coordinate through one focal point.
9.We believe that the actions and measures that the Office of Rightsizing
is taking, particularly the Interagency Rightsizing Summit, are useful
steps to implementing our recommendation. However, based on our
discussions with non-State agencies, we maintain that more outreach is
needed pertaining to areas involving rightsizing review efforts, strategy,
and vision.
Appendix VI: GAO Contact and Staff Acknowledgments
Jess Ford (202) 512-4128
In addition to the individual named above, John Brummet, Assistant
Director, Ann Baker, Joseph Carney, Virginia Chanley, Lyric Clark, Martin
De Alteriis, Etana Finkler, Beth Hoffman Leon, Ernie Jackson, Andrea
Miller, and Deborah Owolabi made key contributions to this report.
(320338)
www.gao.gov/cgi-bin/getrpt? GAO-06-737 .
To view the full product, including the scope
and methodology, click on the link above.
For more information, contact Jess Ford at (202) 512-4128 or
[email protected].
Highlights of GAO-06-737 , a report to the Chairman, Subcommittee on
National Security, Emerging Threats, and International Relations,
Committee on Government Reform, House of Representatives
June 2006
OVERSEAS STAFFING
Rightsizing Approaches Slowly Taking Hold but More Action Needed to
Coordinate and Carry Out Efforts
In 2001, the administration identified the rightsizing of embassies and
consulates as one of the President's management priorities. Rightsizing
initiatives include: aligning staff overseas with foreign policy
priorities and security and other constraints; demonstrating results by
moving administrative functions from posts to regional or central
locations; and eliminating duplicative functions at posts. This report (1)
discusses the size and recent trends in the U.S. government overseas
presence, (2) assesses the congressionally mandated Office of
Rightsizing's progress in managing the U.S. government's overseas
rightsizing efforts, and (3) assesses the process and outcomes of the
legislatively mandated rightsizing reviews of overseas posts.
What GAO Recommends
We recommend that the Secretary of State provide management oversight to
complete and maintain a unified database to accurately capture and
validate U.S. overseas staffing numbers, increase outreach activities with
non-State agencies, and require that posts develop rightsizing action
plans. State indicated that it has either recently implemented or is
taking steps to implement all of our recommendations.
Almost five years into the President's Management Initiative on
rightsizing, the U.S. government does not yet have accurate data on the
size of the U.S. overseas presence. At various times, we received
estimates ranging from 66,000 to 69,000 American and non-American
personnel. In addition, State estimated that there are approximately
78,000 U.S. government positions overseas, as of December 2005. State
Department (State) officials said that they are working on a unified
database which, if periodically updated by posts, will provide an accurate
depiction of the overseas presence. State officials indicated that the
database will be completed later this year. Because of the importance of
having accurate data on overseas staffing and the length of time it has
taken to develop this data, management oversight may be needed to ensure
completion of this task. Several agencies reported that they have added
staff overseas as a result of new mission requirements, and other agencies
reported that they have repositioned their personnel to better meet
mission needs and in response to rightsizing efforts.
State established the congressionally mandated Office of Rightsizing the
United States Government Overseas Presence (Office of Rightsizing) in
2004, which, after a slow start, has begun to provide overall direction to
the government-wide rightsizing process. Some of the office's activities
have included coordinating staffing requests of U.S. government agencies,
developing guidance for and analyzing post rightsizing reviews, and
formulating a rightsizing review plan. We found that coordination on
rightsizing issues between State and other agencies with an overseas
presence was initially slow, but has since improved. Nevertheless,
non-State agencies have voiced a number of concerns regarding their
interaction with the Office of Rightsizing, including their desire to be
more included in the rightsizing process.
Congress requires Chiefs of Mission to conduct rightsizing reviews at
every overseas post at least once every 5 years. Between late 2004 and
summer 2005, about 35 posts participated in the first cycle of reviews.
However, the Office of Rightsizing provided limited guidance to posts on
how the reviews should be conducted and did not have a systematic process
for reporting the outcomes of the reviews. In fall 2005, officials in the
Office of Rightsizing developed more comprehensive guidance, which posts
we interviewed found useful. We found that cost was not considered a key
element in the post reviews. Nevertheless, the Office of Rightsizing
reported over $150 million in cost savings or avoidance to the U.S.
government based on its analysis of these reviews. Although we have not
been able to independently assess the Office of Rightsizing's estimates,
it has presented evidence to show that some major cost avoidance and cost
savings have occurred. Management officers identified various challenges
to the review process, such as resistance from non-State agencies and a
lack of time to conduct the review. It is unclear how posts will implement
the rightsizing review decisions, such as elimination of duplicative
functions, according to post officials and officials in State's regional
bureaus.
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