Department of Energy: Uncertain Progress in Implementing National
Laboratory Reforms (Letter Report, 09/10/1998, GAO/RCED-98-197).

The Department of Energy (DOE) manages the largest laboratory system of
its kind in the world: 23 laboratories in 14 states, a combined budget
exceeding $10 billion a year, and a staff of about 60,000. Since the
early days of the World War II Manhattan Project, DOE's laboratories
have played a major role in maintaining U.S. leadership in research and
development. During the last 20 years, however, various advisory groups
have questioned DOE's stewardship of the laboratory complex, citing
management weaknesses. In recent years, Congress has held several
hearings on the future of the national laboratories. This report (1)
identifies the recommendations by various advisory groups for addressing
management weaknesses at DOE and the laboratories and (2) evaluates how
DOE and its laboratories have responded to these recommendations. GAO
summarized this report in testimony before Congress; see: Department of
Energy: DOE Lacks an Effective Strategy for Addressing Recommendations
From Past Laboratory Advisory Groups, by Victor S. Rezendes, Director of
Energy, Resources, and Science Issues, before the Subcommittee on Basic
Research and the Subcommittee on Energy and Environment, House Committee
on Science. GAO/T-RCED-98-274, Sept. 23 (10 pages).

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  RCED-98-197
     TITLE:  Department of Energy: Uncertain Progress in Implementing
	     National Laboratory Reforms
      DATE:  09/10/1998
   SUBJECT:  Energy research
	     Advisory committees
	     Laboratories
	     Research program management
	     Strategic planning
	     Agency missions
	     Research and development facilities

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GAO/RCED-98-197

Cover
================================================================ COVER

Report to Congressional Requesters

September 1998

DEPARTMENT OF ENERGY - UNCERTAIN
PROGRESS IN IMPLEMENTING NATIONAL
LABORATORY REFORMS

GAO/RCED-98-197

Uncertain Progress in Implementing Reforms

(141136)

Abbreviations
=============================================================== ABBREV

  DOE - Department of Energy
  GAO - General Accounting Office
  DOD - Department of Defense
  IDA - Institute for Defense Analyses
  NASA - National Aeronautics and Space Administration
  NSTC - National Science and Technology Council
  R&D - research and development

Letter
=============================================================== LETTER

B-280451

September 10, 1998

The Honorable F.  James Sensenbrenner, Jr.
Chairman
The Honorable George E.  Brown, Jr.
Ranking Minority Member
Committee on Science
House of Representatives

The Department of Energy (DOE) manages the largest laboratory system
of its kind in the world.  Since the early days of the World War II
Manhattan Project, DOE's laboratories have played a major role in
maintaining U.S.  leadership in research and development (R&D).  With
23 laboratories in 14 states, a combined budget of over $10 billion a
year, and a staff of about 60,000, DOE is responsible for ensuring
that the laboratory system is managed in an effective, efficient, and
economical manner.

DOE's stewardship of the laboratory complex has been questioned over
the past 20 years by various advisory groups.  These groups have
identified management weaknesses in the way DOE manages its
laboratory system.  In recent years, the Congress has held several
hearings on various aspects of the future of the national
laboratories.  Since 1994, we have testified three times on the
missions and management of the national laboratories.

Concerned about DOE's progress in making needed management reforms,
you asked us to

  -- identify the recommendations by various advisory groups for
     addressing management weaknesses at DOE and the laboratories and

  -- evaluate how DOE and its laboratories have responded to these
     recommendations.

   RESULTS IN BRIEF
------------------------------------------------------------ Letter :1

For nearly 20 years, many advisory groups have found that while DOE's
national laboratories do impressive research and development, they
are unfocused, are micromanaged by DOE, and do not function as an
integrated national research and development system.  Weaknesses in
DOE's leadership and accountability are often cited as factors
hindering fundamental reform of the laboratories' management.  As a
result, advisory groups have made dozens of recommendations ranging
from improving strategic planning to streamlining internal processes.
Several past advisory groups have also suggested major organizational
changes in the way the laboratories are directed.

To address past recommendations by advisory groups, DOE, at our
request, documented the actions it has taken, from creating new task
forces to developing strategic laboratory plans.  While DOE has made
some progress--principally by reducing paperwork burdens on its
laboratories--most of its actions are still under way or have unclear
outcomes.  Furthermore, these actions lack the objectives,
performance measures, and milestones needed to effectively track
progress and account for results.  Consequently, the Department
cannot show how its actions have resulted, or may result, in
fundamental change.  For example, its Strategic Laboratory Missions
Plan, which was developed to give more focus and direction to the
national laboratories, does not set priorities and is not tied to the
annual budget process.  Few experts and officials we consulted could
show how the plan is used to focus missions or integrate the
laboratory system.  DOE's latest technique for focusing the
laboratories' missions is the "technology roadmap." Roadmaps are
plans that show how specific DOE activities relate to missions,
goals, and performers.  Roadmaps are a promising step but have been
used in only a few mission areas and are not directly tied to DOE's
budget process.  Moreover, several laboratory directors questioned
both the accuracy of the actions DOE has reported taking and their
applicability at the laboratory level.  DOE's organizational
weaknesses, which include unclear lines of authority, are a major
reason why the Department has been unable to develop long-term
solutions to the recurring problems reported by advisory groups.
Although DOE created the Laboratory Operations Board to help oversee
laboratory management reform, it is only an advisory body within
DOE's complex organizational structure and lacks the authority to
direct change.

   BACKGROUND
------------------------------------------------------------ Letter :2

The missions of DOE's 23 laboratories have evolved over the last 55
years.  Originally created to design and build atomic bombs under the
Manhattan Project, these laboratories have since expanded to conduct
research in many disciplines--from high-energy physics to advanced
computing at facilities throughout the nation.  DOE's goal is to use
the laboratories for developing clean energy sources and
pollution-prevention technologies, for ensuring enhanced security
through reductions in the nuclear threat, and for continuing
leadership in the acquisition of scientific knowledge.  The
Department considers the laboratories a key to a growing economy
fueled by technological innovations that increase U.S.  industrial
competitiveness and create new high-skill jobs for American workers.
Missions have expanded in the laboratories for many reasons,
including changes in the world's political environment.

Nine of DOE's 23 laboratories are multiprogram national laboratories;
they account for about 70 percent of the total laboratory budget and
about 80 percent of all laboratory personnel.  Three of these
multiprogram national laboratories (Lawrence Livermore, Los Alamos,
and Sandia) conduct the majority of DOE's nuclear weapons defense
activities.  Facing reduced funding for nuclear weapons as a result
of the Cold War's end and the signing of the comprehensive nuclear
test ban treaty, these three laboratories have substantially
diversified to maintain their preeminent talent and facilities.  The
remaining laboratories in DOE's system are program- and
mission-dedicated facilities.  (See app.  I for a list of all DOE
laboratories.) DOE owns the laboratories and contracts with
universities and private-sector organizations for the management and
operation of 19, while providing federal staff for the remaining 4.

The Congress is taking a growing interest in how the national
laboratories are being managed.  Recently introduced legislation
would restructure the missions of the laboratories or manage them in
new ways.  Some previously proposed organizational options include
converting the laboratories that are working closely with the private
sector into independent entities or transferring the responsibility
for one or more laboratories to other federal agencies whose missions
are closely aligned with those of particular DOE laboratories.  We
have reported to the Congress that DOE's efforts to sharpen the focus
and improve the management of its laboratories have been elusive and
that the challenges facing the Department raise concerns about how
effectively it can manage reform initiatives.\1

--------------------
\1 Department of Energy:  National Laboratories Need Clearer Missions
and Better Management (GAO/RCED-95-10, Jan.  27, 1995).

   ADVISORY GROUPS CITE CONTINUING
   MISSION AND MANAGEMENT CONCERNS
   AT THE NATIONAL LABORATORIES
------------------------------------------------------------ Letter :3

Over the past several years, many government advisory groups have
raised concerns about how DOE manages its national laboratory system.
Major concerns centered on three issues:

  -- The laboratories' missions are unfocused.

  -- DOE micromanages the laboratories.

  -- The laboratories are not operating as an integrated system.

More recent advisory groups have reported similar weaknesses,
prompting the Congress to take a close look at how the national
laboratory system is meeting its objectives.

      CONCERNS RAISED BY ADVISORY
      GROUPS
---------------------------------------------------------- Letter :3.1

We identified nearly 30 reports by a wide variety of advisory groups
on various aspects of the national laboratories' management and
missions.  (See app.  II for a list of past reports.) Most of these
reports have been prepared since the early 1980s.  The reports
include the following:

  -- In 1982, DOE's Energy Research Advisory Board reported that the
     national laboratories duplicate private-sector research and that
     while DOE could take better advantage of the national
     laboratories' capabilities, it needed to address its own
     management and organizational inefficiencies, which hamper the
     achievement of a more effective laboratory system.\2

  -- In 1983, a White House Science Council Panel found that while
     DOE's laboratories had well-defined missions for part of their
     work, most activities were fragmented and unrelated to the
     laboratories' main responsibilities.\3

  -- In 1992, DOE's Secretary of Energy Advisory Board found that the
     laboratories' broad missions, coupled with rapidly changing
     world events, had "caused a loss of coherence and focus at the
     laboratories, thereby reducing their overall effectiveness in
     responding to their traditional missions as well as new national
     initiatives.  .  .  ."\4

  -- A 1993 report by an internal DOE task force reported that
     missions "must be updated to support DOE's new directions and to
     respond to new national imperatives.  .  .  ."\5

The most recent extensive review of DOE's national laboratories was
performed by a task force chaired by Robert Galvin, former Chairman
of the Motorola Corporation.  Consisting of distinguished leaders
from government, academia, and industry, the Galvin Task Force was
established to examine alternatives for directing the laboratories'
scientific and engineering resources to meet the economic,
environmental, defense, scientific, and energy needs of the nation.
Its 1995 report identified many of the problems noted in earlier
studies and called for a more disciplined focus for the national
laboratories, also reporting that the laboratories may be oversized
for their role.\6

The Galvin Task Force reported that the traditional government
ownership and contractor operation of the laboratories has not worked
well.  According to its report, increasing DOE's administration and
oversight transformed the laboratories from traditional
contractor-operated systems into a virtual government-operated
system.  The report noted that many past studies of DOE's
laboratories had resulted in efforts to fine-tune the system but led
to little fundamental improvement.  Regarding the management
structure of DOE's non-weapons-oriented laboratories, the task force
recommended a major change in the organization and governance of the
laboratory system.  The task force envisioned a not-for-profit
corporation governed by a board of trustees, consisting primarily of
distinguished scientists and engineers and experienced senior
executives from U.S.  industry.  Such a change in governance, the
task force reported, would improve the standards and quality of work
and at the same time generate over 20 percent in cost savings.

Other findings by the task force and subsequent reports by other
advisory groups have focused on the need for DOE to integrate R&D
programs across the Department and among the laboratories to increase
management efficiencies, reduce administrative burdens, and better
define the laboratories' missions.

In June 1995, DOE's Task Force on Strategic Energy Research and
Development, chaired by energy analyst Daniel Yergin, issued a report
on DOE's energy R&D programs.\7 The report assessed the rationale for
the federal government's support of energy R&D, reviewed the
priorities and management of the overall program, and recommended
ways of making it more efficient and effective.  The task force
recommended that DOE streamline its R&D management, develop a
strategic plan for energy R&D, eliminate duplicative laboratory
programs and research projects, and reorganize and consolidate
dispersed R&D programs at DOE laboratories.

In August 1995, the National Science and Technology Council examined
laboratories in DOE, the Department of Defense (DOD), and the
National Aeronautics and Space Administration (NASA).\8 The Council
reported that DOE's existing system of laboratory governance needs
fundamental repair, stating that DOE's laboratory system is bigger
and more expensive than is needed to meet essential missions in
energy, the environment, national security, and fundamental science.
The Council recommended that DOE develop ways to eliminate apparent
overlap and unnecessary redundancy between its laboratory system and
DOD's and NASA's.

DOE's Laboratory Operations Board was created in 1995 to focus the
laboratories' missions and reduce DOE's micromanagement.  Members
serving on the Board from outside DOE have issued four different
reports, which have noted the need to

  -- focus and define the laboratories' missions in relation to the
     Department's missions,

  -- integrate the laboratories' programmatic work, and

  -- streamline operations, including the elimination or reduction of
     administrative burdens.

In March 1997, the Office of Science and Technology Policy reported
on laboratories managed by DOE, DOD, and NASA.\9 The Office cited
efforts by the three agencies to improve their laboratory management
but found that DOE was still micro-managing its laboratories and had
made little progress toward reducing the administrative burdens it
imposes on its laboratories.  The Office recommended a variety of
improvements in performance measures, incentives, and productivity
and urged more streamlined management.

In March 1997, a report by the Institute for Defense Analyses (IDA)
found that DOE's processes for managing environment, safety, and
health activities were impeding effective management.\10 According to
IDA, DOE's onerous review processes undermined accountability and
prevented timely decisions from being made and implemented throughout
the entire nuclear weapons complex, including the national
laboratories.  IDA specifically noted that DOE's Defense Programs had
confusing line and staff relationships, inadequately defined roles
and responsibilities, and poorly integrated programs and functions.
IDA concluded that DOE needed to strengthen its line accountability
and reorganize its structure in several areas.

--------------------
\2 The Department of Energy Multiprogram Laboratories:  A Report of
the Energy Research Advisory Board to the United States Department of
Energy (Sept.  1982).

\3 Report of the White House Science Council, Federal Laboratory
Review Panel, Office of Science and Technology Policy, Executive
Office of the President (May 20, 1983).

\4 Final Report, Secretary of Energy Advisory Board (1992).

\5 Changes and Challenges at the Department of Energy Laboratories:
Final Draft Report of the Missions of the Laboratories Priority Team
(1993).

\6 Alternative Futures for the Department of Energy National
Laboratories, Secretary of Energy Advisory Board Task Force on
Alternative Futures for the Department of Energy National
Laboratories, DOE (Feb.  1995).

\7 Energy R&D:  Shaping our Nation's Future in a Competitive World.
Final Report, Final Report of the Task Force on Strategic Energy
Research and Development, Secretary of Energy Advisory Board, DOE
(June 1995).

\8 Future of Major Federal Laboratories, National Science and
Technology Council (Aug.  1995).

\9 Status of Federal Laboratory Reforms.  The Report of the Executive
Office of the President Working Group on the Implementation of
Presidential Decision Directive PDD/NSTC-5, Office of Science and
Technology Policy, Executive Office of the President (Mar.  1997).

\10 The Organization and Management of the Nuclear Weapons Program,
Institute for Defense Analyses (Mar.  1997).

   DOE LACKS AN EFFECTIVE STRATEGY
   FOR ADDRESSING ADVISORY GROUPS'
   RECOMMENDATIONS
------------------------------------------------------------ Letter :4

At our request, DOE provided us with a listing of the actions it took
in response to repeated calls for more focused laboratory missions
and improved management.  But while DOE has made
progress--principally by reducing paperwork burdens on its
laboratories--most of its actions are still in process or have
unclear expectations and deadlines.  Furthermore, the Department
cannot demonstrate how its actions have resulted, or may result, in
fundamental change.

To analyze progress in laboratory management reform, we talked to DOE
and laboratory officials and asked DOE to document the actions it has
taken, is taking, or has planned to address the recommendations from
several advisory groups.\11 We used DOE's responses, which are
reprinted in appendix III, as a basis for discussions with laboratory
and DOE officials and with 18 experts familiar with national
laboratory issues.  We asked these experts to examine DOE's
responses.  Several of these experts had served on the Galvin Task
Force and are currently serving on DOE's Laboratory Operations Board
(app.  IV lists the experts we interviewed).  The actions DOE said it
is taking include

  -- creating various internal working groups;

  -- strengthening the Energy R&D Council to facilitate more
     effective planning, budgeting, management, and evaluation of the
     Department's R&D programs and to improve the linkage between
     research and technology development;

  -- increasing the use of private-sector management practices;

  -- adopting performance-based contracting and continuous
     improvement concepts;

  -- improving the oversight of efforts to enhance productivity and
     reduce overhead costs at the laboratories;

  -- expanding the laboratories' work for other federal agencies;

  -- evaluating the proper balance between laboratories and
     universities for basic research;

  -- improving science and technology partnerships with industry;

  -- reducing unnecessary oversight burdens on laboratories;

  -- developing the Strategic Laboratory Missions Plan in July 1996
     that identified laboratory activities in mission areas;

  -- creating the Laboratory Operations Board, which includes DOE
     officials and experts from industry and academia, to provide
     guidance and direction to the laboratories; and

  -- developing "technology roadmaps," a strategic planning technique
     to focus the laboratories' roles.

--------------------
\11 DOE agreed with GAO to document only those actions taken in
response to advisory groups' recommendations published since the 1995
Galvin Task Force report.  These reports are listed in DOE's response
in app.  III.

      DOE'S ACTIONS OFFER
      UNCERTAIN PROGRESS
---------------------------------------------------------- Letter :4.1

Most of the actions DOE reported to us are process oriented,
incomplete, or only marginally related to past recommendations for
change.  For example, creating new task forces and strengthening old
ones may be good for defining problems, but these measures cannot
force decisions or effect change.

DOE's major effort to give more focus to laboratory missions was a
Strategic Laboratory Missions Plan, published in July 1996.  The plan
describes the laboratories' capabilities in the context of DOE's
missions and, according to the plan, will form the basis for defining
the laboratories' missions in the future.  However, the plan is
essentially a descriptive document that does not direct change.  Nor
does the plan tie DOE's or the laboratories' missions to the annual
budget process.  When we asked laboratory officials about strategic
planning, most discussed their own planning capabilities, and some
laboratories provided us with their own self-generated strategic
planning documents.  None of the officials at the six laboratories we
visited mentioned DOE's Strategic Laboratory Missions Plan as an
essential document for their strategic planning.

A second action that DOE officials reported as a major step toward
focusing the laboratories' missions is the introduction of its
"technology roadmaps." These are described by DOE as planning tools
that define the missions, goals, and requirements of research on a
program-by-program basis.  Officials told us that the roadmaps are
used to connect larger departmental goals and are a way to
institutionalize strategic planning within the Department.  Roadmaps,
according to DOE, will be an important instrument for melding the
laboratories into a stronger and more integrated national system.
DOE reports that roadmaps have already been developed in some areas,
including nuclear science, high-energy physics, and the fusion
program.

Experts we interviewed agreed that creating roadmaps can be a way to
gain consensus between DOE and the laboratories on a common set of
objectives while also developing a process for reaching those
objectives.  However, some experts also stated that it is too soon to
tell if this initiative will succeed.  One expert indicated that the
Department has not adequately analyzed its energy R&D problems on a
national basis before beginning the roadmap effort.  Another was
uncertain about just how the roadmaps will work.  According to a
laboratory director who was recently asked to comment on the roadmap
process, more emphasis needs to be placed on the results that are
expected from the roadmaps, rather than on the process of creating
them.  Furthermore, roadmapping may be difficult in some areas,
especially for activities involving heavy regulatory requirements.\12
When we asked DOE officials about roadmapping, we were told that it
is still a work in progress and will not be connected directly to the
budget process for months or even years.

Other DOE actions are also described as works in progress.  For
example, the use of performance-based contracts is relatively new,
and the results from the strengthened R&D Council are still
uncertain.  The R&D Council includes the principal secretarial
officers who oversee DOE's R&D programs and is chaired by the Under
Secretary.  According to DOE, the Council has a new charter that will
promote the integration and management of the Department's R&D.

One area in which DOE reports that it has made significant
improvements is reducing the burden of its oversight on the national
laboratories.  Although some laboratory directors told DOE that their
laboratories are still micromanaged, most officials and experts we
interviewed credited DOE with reducing oversight as the major
positive change since the Galvin Task Force issued its report in
1995.

--------------------
\12 Comments from the Laboratory Operations Board meeting, Feb.  24,
1998.

      THE LABORATORY OPERATIONS
      BOARD WAS CREATED TO PROVIDE
      LABORATORY FOCUS
---------------------------------------------------------- Letter :4.2

DOE's major organizational action in response to recent advisory
groups' recommendations was to create the Laboratory Operations Board
in April 1995.  The purpose of the Board is to provide dedicated
management attention to laboratory issues on a continuing basis.  The
Board includes 13 senior DOE officials and 9 external members drawn
from the private sector, academia, and the public.  The external
members have staggered, 6-year terms and are required to assess DOE's
and the laboratories' progress in meeting such goals as management
initiatives, productivity improvement, mission focus, and
programmatic accomplishments.

The Board's external members have issued four reports, the results of
which largely mirror past findings by the many previous advisory
groups.  These reports have also concluded that DOE has made some
progress in addressing the problems noted by the Galvin Task Force
but that progress has been slow and many of the recommendations need
further actions.

Several experts we interviewed generally viewed the Board positively.
Some, however, recognized that the Board's limited advisory role is
not a substitute for strong DOE leadership and organizational
accountability.  One expert commented that the effectiveness of the
Board was diminished by the fact that it meets too infrequently
(quarterly) and has had too many changes in membership to function as
an effective adviser.  Other experts agreed but indicated that the
Board still has had a positive influence on reforming the laboratory
system.  One expert said that the Board's membership is not properly
balanced between internal and external members (although originally
specifying 8 of each, the Board's charter was recently changed to
require 13 DOE members and only 9 external members).  Another expert
indicated that the Board could increase its effectiveness by more
carefully setting an agenda for each year and then aggressively
monitoring progress to improve its management of the laboratory
system.

Laboratory officials we interviewed also viewed the Board in
generally positive terms; some commented that the Board's presence
gives the laboratories a much needed voice in headquarters.  Others
noted that the Board could eventually play a role in integrating the
laboratories' R&D work across program lines, thereby addressing a
major concern about the laboratories' lack of integration noted by
past advisory groups.

Although the Board can be an effective source of direction and
guidance for the laboratories, it has no authority to carry out
reform operations.  One expert said that even though the Board
monitors the progress of reform and makes recommendations, it is
still advisory and cannot coordinate or direct specific actions.

      LABORATORY DIRECTORS HAVE
      CONCERNS ABOUT SOME DOE
      ACTIONS
---------------------------------------------------------- Letter :4.3

DOE requested comments from the laboratory directors on a draft of
its response to our request for information about the actions DOE is
taking to meet the advisory groups' recommendations.  Some of the
directors raised questions about both the accuracy of DOE's reported
actions and their applicability at the laboratory level.  For
example, some laboratory officials believe little progress has been
made in meeting past recommendations to provide more focus on the
laboratories' missions:

     "[This] remains in the future.  We have seen nothing yet."

     "The response appears to sidestep the important need for
     lab-focused budgeting and strategic planning.  The response
     discusses strategic planning in terms of DOE roadmaps for each
     program, not in terms of plans for each lab.  Many labs continue
     to have a broad mission which crosses several [programs].  .  .
     .  While there may be an ongoing review by the [program
     officers], the labs have no evidence this is occurring and there
     have been no actions to address this."

     "The [Galvin Task Force] wanted one clear lead lab in each
     mission or program, and DOE did not do that; there are 2 to 4
     "principal" labs for each major business.  Even for major
     program areas, 12 of the 15 programs listed in the department's
     laboratory mission plan have more than one laboratory listed as
     primary performer."

     ".  .  .  it is not clear that DOE has made any significant
     progress as the response implies.  .  .  ."

In commenting on DOE's response to the Galvin Task Force's
recommendation that DOE reorganize to provide better integration in
applied energy programs, two laboratory directors responded as
follows:

     "[The] tone of the response in [DOE's response] is a bit more
     optimistic than actual experience in the field justifies.  .  .
     .  Only modest improvements have occurred to
     this point.  .  .  ."

     "No reorganization has occurred .  .  .  no integration has
     occurred."

Another laboratory director commented on DOE's response to the Galvin
Task Force's recommendation that DOE establish mechanisms to manage
multiprogram laboratories as a system.  According to the director,

     "the examples provided to substantiate the labs working together
     as a system are not all new, some were in place when [the Galvin
     Task Force] wrote [its] report.  Also, there have been a number
     of meetings between the multi-program labs but that is the
     extent of any progress in this area (little change has been
     made)."

In response to the Galvin Task Force's recommendation that the
laboratories be given a greater role in environmental management, one
laboratory director said,

     "The labs have largely been held at arm's length rather than
     included as part of the team.  There have been recent efforts to
     correct this but there is no plan or action in place to correct
     it."

Additionally, when we asked several laboratory officials for examples
of their progress in responding to past advisory groups, most spoke
of actions they have taken on their own initiative.  Few could cite
an example of a step taken in direct response to a DOE action.  For
example, several laboratory officials cited an increased level of
cooperation and coordination among the laboratories involved with
similar R&D activities.  They also mentioned adopting "best business
practices" to increase productivity, reduce overhead costs, and
measure progress by improved metrics.  However, many laboratory
officials told us that many of their actions were taken to meet other
demands, such as legislative and regulatory mandates, rather than as
direct responses to the studies' recommendations or to DOE's
policies.

      DOE LACKS AN EFFECTIVE
      STRATEGY FOR MANAGING
      RECOMMENDED CHANGES
---------------------------------------------------------- Letter :4.4

Despite its efforts to respond to the advisory groups'
recommendations, DOE has not established either a comprehensive plan
with goals, objectives, and performance measures or a system for
tracking results and measuring accountability.  As a result, DOE is
unable to document its progress and cannot show how its actions
address the major issues raised by the advisory groups.  Experts we
contacted noted that while DOE is establishing performance measures
for gauging how well its contractors manage the laboratories, DOE
itself lacks any such measurement system for ensuring that the
objectives based on the advisory groups' recommendations are met.

      ORGANIZATIONAL WEAKNESSES
      ARE PREVENTING LABORATORY
      MANAGEMENT REFORM
---------------------------------------------------------- Letter :4.5

We, along with past advisory groups and internal DOE studies, have
often reported on DOE's complex organizational structure and the
problems in accountability that result from unclear chains of command
among headquarters, field offices, and the laboratories.  For
example, a 1997 DOE report stated that

     "lack of clarity, inconsistency, and variability in the
     relationship between headquarters management and field
     organizations has been a longstanding criticism of DOE
     operations.  This is particularly true in situations when
     several headquarters programs fund activities at laboratories.
     .  .  ."\13

DOE's Laboratory Operations Board also reported in 1997 on DOE's
organizational problems, noting that there were inefficiencies due to
DOE's complicated management structure.  The Board recommended that
DOE undertake a major effort to rationalize and simplify its
headquarters and field management structure to clarify roles and
responsibilities.

Similarly, the 1997 IDA report cited serious flaws in DOE's
organizational structure.  Noting long-standing concerns in DOE about
how best to define the relationships between field offices and the
headquarters program offices that sponsor work, the Institute
concluded that "the overall picture that emerges is one of
considerable confusion over vertical relationships and the roles of
line and staff officials."

DOE's complex organization stems from the multiple levels of
reporting that exist between the laboratories, field offices (called
operations offices), and headquarters program offices.  DOE's
laboratories are funded and directed by program offices--the nine
largest laboratories are funded by many different DOE program
offices.  The program office that usually provides the dominant
funding serves as the laboratory's "landlord".  The landlord program
office is responsible for sitewide management at the laboratory and
coordinates crosscutting issues, such as compliance with environment,
safety, and health requirements at the laboratories.  DOE's Energy
Research is landlord to several laboratories, including the
Brookhaven and Lawrence Berkeley laboratories.  Defense Programs is
the landlord for the Los Alamos and Lawrence Livermore national
laboratories.  The program offices, in turn, report to either the
Deputy Secretary or the Under Secretary.

Further complicating reporting, DOE assigns each laboratory to a
field operations office, whose director serves as the contract
manager and also prepares the laboratory's annual appraisal.  The
operations office, however, reports to a separate headquarters office
under the Deputy Secretary, not to the program office that supplies
the funding.  Thus, while the Los Alamos National Laboratory is
primarily funded by Defense Programs, it reports to a field manager
who reports to another part of the agency.

As a consequence of DOE's complex structure, IDA reported that
unclear chains of command led to the weak integration of programs and
functions across the Department, wide variations among field
activities and relationships and processes, and confusion over the
difference between line and staff roles.

Weaknesses in DOE's ability to manage the laboratories as an
integrated system of R&D facilities is one the most persistent
findings from past advisory groups, as well as from our 1995
management review of laboratory issues.  We concluded that DOE had
not coordinated the laboratories' efforts as part of a diversified
research system to solve national problems.  Instead, DOE was
managing the laboratories on a program-by-program basis.  We
recommended that DOE evaluate alternatives for managing the
laboratories that would more fully support the achievement of clear
and coordinated missions.  To help achieve this goal, we said that
DOE should strengthen the Office of Laboratory Management to
facilitate the laboratories' cooperation and resolve management
issues across all DOE program areas.  DOE did not strengthen this
office.  DOE's primary response to our recommendations and those made
by the Galvin Task Force was creating the Laboratory Operations
Board.

A further consequence of no central laboratory authority is the
inability to track and enforce laboratory reforms.  Experts we
interviewed cited DOE's complex structure and lack of a strong
central laboratory authority as hindering the effective
implementation of advisory groups' recommendations.  Comments made to
us included the following:

     "DOE's organization is a mess.  You cannot tell who is the boss.
     DOE would be much more effective if layers were removed."

     "DOE has not been responsive to recommendations for
     organizational changes and improvements in [reporting]
     relationships."

Experts we consulted noted that DOE's organizational weaknesses
prevent reform.  According to experts, DOE's establishment of working
groups to implement recommendations can be helpful for guiding
reform, but these groups often lack the authority to make critical
decisions or to enforce needed reforms.  One expert commented that
"the current DOE organizational structure is outdated .  .  .  there
is no DOE leadership to implement changes."

We believe these organizational weaknesses are a major reason why DOE
has been unable to develop long-term solutions to the recurring
problems reported by advisory groups.  The absence of a senior
official in the Department with program and administrative authority
over the operations of all the laboratories prevents effective
management of the laboratories on an ongoing basis.

As far back as 1982, an advisory group recognized the need for a
strong central focus to manage the laboratories' activities.  In its
1982 report, DOE's Energy Research Advisory Board noted "layering and
fractionation of managerial and research and development
responsibilities in DOE on an excessive number of horizontal and
vertical levels.  .  .  ."\14 The Board recommended that DOE
designate a high level official, such as a Deputy Under Secretary,
whose sole function would be to act as DOE's chief laboratory
executive.  Although DOE did not make this change, the Under
Secretary has assumed responsibility for ensuring that laboratory
reforms are accomplished.

--------------------
\13 DOE Action Plan for Improved Management of Brookhaven National
Laboratory, DOE (July 1997).

\14 The Department of Energy Multiprogram Laboratories:  A Report of
the Energy Research Advisory Board to the United States Department of
Energy (Sept.  1982).

   CONCLUSIONS
------------------------------------------------------------ Letter :5

Despite many studies identifying similar deficiencies in the
management of DOE's national laboratories, fundamental change remains
an elusive goal.  While the Department has many steps in process to
improve its management of the laboratories--such as new strategic
planning tools and the Laboratory Operations Board--the results of
these efforts may be long in coming and may fall short of
expectations.  Other actions DOE is taking are focused more on
process than on results, and most are still incomplete, making it
difficult to show how DOE intends to direct the laboratories'
missions and manage them more effectively as an integrated system--a
major recommendation of past advisory groups.  The Department has not
developed a way to show how its actions will result in practical and
permanent laboratory reform.  We believe that without a strategy for
ensuring that reforms actually take place, DOE will make only limited
progress in achieving meaningful reforms.

Establishing accountability for ensuring that its actions will take
place in a timely manner is a challenge for DOE.  The Department's
complex organizational structure creates unclear lines of authority
that dilute accountability and make reforms difficult to achieve.  In
our 1995 management review of DOE's laboratories, we reported that if
DOE is unable to refocus the laboratories' missions and develop a
management approach consistent with these new missions, the Congress
may wish to consider alternatives to the present relationships
between DOE and the laboratories.  Such alternatives might include
placing the laboratories under the control of different agencies or
creating a separate structure for the sole purpose of developing a
consensus on the laboratories' missions.  Because of DOE's uncertain
progress in reforming the laboratories' management, we continue to
believe that the Congress may wish to consider such alternatives.

   RECOMMENDATION TO THE SECRETARY
   OF ENERGY
------------------------------------------------------------ Letter :6

To ensure the timely and effective implementation of recommendations
from the many past laboratory advisory groups, we recommend that the
Secretary of Energy develop a comprehensive strategy with objectives,
milestones, DOE offices and laboratories responsible for
implementation actions, performance measures that will be used to
assess success in meeting implementation objectives, a tracking
system to monitor progress, and regular progress reports on the
status of implementation.

   AGENCY COMMENTS
------------------------------------------------------------ Letter :7

We provided a draft of this report to DOE for review and comment.
Although DOE did not comment directly on our conclusions and
recommendation, the Department said that we did not take into account
the full range of changes that it has undertaken.  Changes discussed
by DOE include a series of initiatives implemented to strengthen
management, streamline the strategic planning processes, and enhance
interactions between DOE and the laboratories.  The Department also
said that the cumulative effect of these changes reflects significant
progress in implementing the recommendations of past advisory groups.

While stating that much has been accomplished to improve the
management of the national laboratories, DOE also acknowledges that
more needs to be done to ensure a fully integrated management system,
including better focusing the laboratories' missions and tying them
to the annual budget process.  DOE anticipates that these actions
will take at least 2 more years to accomplish.

In preparing our report, we considered the actions the Department
reports it has taken to implement past recommendations from
laboratory advisory groups.  While the types of reported actions are
positive, progress made toward the goals and objectives of reform
cannot be determined without a plan for measuring progress.  As we
state in our report, some laboratory directors have reported to DOE
that they have not seen the results of some of these actions at their
level.  We continue to believe that DOE needs to monitor, measure,
and evaluate its progress in accomplishing reforms.  If it does not
do so, it will have difficulty holding its managers accountable for
making the needed changes and determining if funds are being spent
wisely on the reform process.

Appendix VI includes DOE's comments and our response.

---------------------------------------------------------- Letter :7.1

As arranged with your offices, unless you publicly announce its
contents earlier, we plan no further distribution of this report
until 30 days after the date of this letter.  At that time, we will
send copies to the Secretary of Energy and the Director, Office of
Management and Budget.  We will make copies available to other
interested parties on request.

Our review was performed from December 1997 through August 1998 in
accordance with generally accepted government auditing standards.
See appendix V for a description of our scope and methodology.

If you or your staff have any questions about this report, please
call me at (202) 512-3841.  Major contributors to this report are
listed in appendix VII.

Victor S.  Rezendes
Director, Energy, Resources,
 and Science Issues

DEPARTMENT OF ENERGY'S
LABORATORIES
=========================================================== Appendix I

                              (Dollars in millions)

                                                                       Estimated
                                                                     fiscal year
                                                                     1998 budget
Laboratory           Contractor                       Location         authority
-------------------  -------------------------------  ------------  ------------
Multiprogram laboratories
--------------------------------------------------------------------------------
Argonne National     University of Chicago            Chicago, IL           $522
Laboratory

Brookhaven National  Brookhaven Science Associates    Upton, NY              417
Laboratory

Idaho National       Lockheed Martin Idaho            Idaho Falls,           783
Engineering          Technologies Co.                 ID
Laboratory

Lawrence Berkeley    University of California         Berkeley, CA           368
National Laboratory

Lawrence Livermore   University of California         Livermore,           1,866
National Laboratory                                   CA

Los Alamos National  University of California         Los Alamos,          1,345
Laboratory                                            NM

Oak Ridge National   Lockheed Martin Energy Research  Oak Ridge,             685
Laboratory                                            TN

Pacific Northwest    Battelle Memorial Institute      Richland, WA           448
National Laboratory

Sandia National      Sandia Corp. (Lockheed Martin)   NM and CA            1,358
Laboratories

Program-dedicated laboratories
--------------------------------------------------------------------------------
Ames Laboratory      Iowa State University            Ames, IA                31

Federal Energy       Federally staffed                PA and WV            973\a
Technology Center

Fermi National       University Research Assoc.,      Batavia, IL            271
Accelerator          Inc.
Laboratory

National Renewable   Midwest Research Institute       Golden, CO             192
Energy Laboratory

Oak Ridge Institute  Oak Ridge Associated             Oak Ridge,              85
for Science and      Universities                     TN
Education

Princeton Plasma     Princeton University             Princeton,              81
Physics Laboratory                                    NJ

Stanford Linear      Stanford University              Palo Alto,             185
Accelerator Center                                    CA

Thomas Jefferson     Southeastern Univ. Research      Newport                 67
National             Assoc., Inc.                     News, VA
Accelerator
Facility

Specific-mission laboratories
--------------------------------------------------------------------------------
Bettis Atomic Power  Westinghouse Electric Corp.      West                 324\a
Laboratory                                            Mifflin, PA

Environmental        Federally staffed                New York, NY          10\a
Measurements
Laboratory

Knolls Atomic Power  KAPL, Inc. (Lockheed Martin)     Niskayuna,           286\a
Laboratory                                            NY

New Brunswick        Federally staffed                Argonne, IL            4\a
Laboratory

Radiological and     Federally staffed                Idaho Falls,           5\a
Environmental                                         ID
Sciences Laboratory

Savannah River       Westinghouse Savannah River Co.  Aiken, SC            194\a
Technology Center
--------------------------------------------------------------------------------
Note:  This list includes only laboratories owned by the Department
of Energy (DOE) and operated either under a management and operating
contract or by DOE employees.  DOE funds other laboratories through
grants to and cooperative agreements with universities.

\a Reflects a prior year's value carried forward.

Source:  DOE (July 14, 1998).

RELATED STUDIES ON NATIONAL
LABORATORIES
========================================================== Appendix II

Department of Energy:  Clearer Missions and Better Management Are
Needed at the National Laboratories (GAO/T-RCED-98-25, Oct.  9,
1997).

External Members of the Laboratory Operations Board Analysis of
Headquarter and Field Structure Issues, Secretary of Energy Advisory
Board, DOE (Sept.  30, 1997).

Third Report of the External Members of the Department of Energy
Laboratory Operations Board, Secretary of Energy Advisory Board, DOE
(Sept.  1997).

DOE Action Plan for Improved Management of Brookhaven National
Laboratory, DOE (July 1997).

The Organization and Management of the Nuclear Weapons Program,
Institute for Defense Analyses (Mar.  1997).

Status of Federal Laboratory Reforms.  The Report of the Executive
Office of the President Working Group on the Implementation of
Presidential Decision Directive PDD/NSTC-5, Office of Science and
Technology Policy, Executive Office of the President (Mar.  1997).

Roles and Responsibilities of the DOE Nuclear Weapons Laboratories in
the Stockpile Stewardship and Management Program (DOE/DP-97000280,
Dec.  1996).

Second Report of the External Members of the Department of Energy
Laboratory Operations Board, Secretary of Energy Advisory Board, DOE
(Sept.  10, 1996).

First Report of the External Members of the Department of Energy
Laboratory Operations Board, Secretary of Energy Advisory Board, DOE
(Oct.  26, 1995).

Future of Major Federal Laboratories, National Science and Technology
Council (Aug.  1995).

Energy R&D:  Shaping Our Nation's Future in a Competitive World,
Final Report of the Task Force on Strategic Energy Research and
Development, Secretary of Energy Advisory Board, DOE (June 1995).

Interagency Federal Laboratory Review Final Report, Office of Science
and Technology Policy, Executive Office of the President (May 15,
1995).

Department of Energy:  Alternatives for Clearer Missions and Better
Management at the National Laboratories (GAO/T-RCED-95-128, Mar.  9,
1995).

Report of the Department of Energy for the Interagency Federal
Laboratory Review in Response to Presidential Review Directive/NSTC-1
(Mar.  1995).

Alternative Futures for the Department of Energy National
Laboratories, Secretary of Energy Advisory Board Task Force on
Alternative Futures for the Department of Energy National
Laboratories, DOE (Feb.  1995).

Department of Energy:  National Laboratories Need Clearer Missions
and Better Management (GAO/RCED-95-10, Jan.  27, 1995).

DOE's National Laboratories:  Adopting New Missions and Managing
Effectively Pose Significant Challenges (GAO/T-RCED-94-113, Feb.  3,
1994).

Changes and Challenges at the Department of Energy Laboratories:
Final Draft Report of the Missions of the Laboratories Priority Team,
DOE (1993).

Final Report, Secretary of Energy Advisory Board (1992).

U.S.  Economic Competitiveness:  A New Mission for the DOE Defense
Programs' Laboratories, Roger Werne, Associate Director for
Engineering, Lawrence Livermore National Laboratory (Nov.  1992).

A Report to the Secretary on the Department of Energy National
Laboratories, Secretary of Energy Advisory Board Task Force on the
Department of Energy National Laboratories, DOE (July 30, 1992).

Progress Report on Implementing the Recommendations of the White
House Science Council's Federal Laboratory Review Panel, Office of
Science and Technology Policy, Executive Office of the President
(July 1984).

The Management of Research Institutions:  A Look at Government
Laboratories, Hans Mark and Arnold Levine, Scientific and Technical
Information Branch, National Aeronautics and Space Administration
(1984).

Report of the White House Science Council Federal Laboratory Review
Panel, Office of Science and Technology Policy, Executive Office of
the President (May 20, 1983).

President's Private Sector Survey on Cost Control Report on the
Department of Energy, the Federal Energy Regulatory Commission, and
the Nuclear Regulatory Commission (1983).

The Department of Energy Multiprogram Laboratories:  A Report of the
Energy Research Advisory Board to the United States Department of
Energy (Sept.  1982).

Final Report of the Multiprogram Laboratory Panel, Volume II:
Support Studies, Oak Ridge National Laboratory (Sept.  1982).

The Multiprogram Laboratories:  A National Resource for Nonnuclear
Energy Research, Development and Demonstration (GAO/EMD-78-62, Mar.
22, 1978).

(See figure in printed edition.)Appendix III
DOE'S RESPONSES TO PAST ADVISORY
GROUPS' RECOMMENDATIONS
========================================================== Appendix II

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(See figure in printed edition.)

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(See figure in printed edition.)

ABBREVIATIONS USED IN APPENDIX III

ASCI Accelerated Strategic Computing Initiative

COO Chief Operating Officer

CRADA Cooperative Research and Development Agreement

CTBT Comprehensive Test Ban Treaty

DARHT Dual-Axis Radiographic Hydrodynamic Testing Facility

DOD Department of Defense

DOE Department of Energy

DOIT Development of On-site Innovative Technologies

DP Office of Defense Programs

DPAG Defense Programs Analysis Group

DP-10 Office of Defense Programs for Research and Development

DP-20 Office of Defense Programs, Military Application
and Stockpile Management

DP-45 Office of Defense Programs for Program Support,
Technical and Environmental Support

EE Office of Energy Efficiency and Renewable Energy

ER Office of Energy Research

EM Environmental Management

EMAB Environmental Management Advisory Board

EPA Environmental Protection Agency

ES&H environment, safety and health

FAA Federal Aviation Administration

FE Office of Fossil Energy

FTE full-time equivalent

HHS Department of Health and Human Services

HQ DP Headquarters, Office of Defense Programs

IDA Institute for Defense Analyses

ISM integrated safety management

KCP Kansas City Plant

LAMPF Los Alamos Meson Physics Experiment

LANL Los Alamos National Laboratory

LANSCE Los Alamos Neutron Scattering Facility

LDRD Laboratory Directed Research and Development

LIVI Laboratory Institutional Vitality Initiative

LLNL Lawrence Livermore National Laboratory

LOB Laboratory Operations Board

M&I management and integration contract

M&O management and operating

NE Office of Nuclear Energy, Science and Technology

NIF National Ignition Facility

NIH National Institutes of Health

NN Office of Nonproliferation and National Security

NSF National Science Foundation

NSTC National Science and Technology Council

O&M operations and maintenance

OMB Office of Management and Budget

OSTP Office and Science and Technology Policy

PCAST President's Committee of Advisors on Science and
Technology

PEIS Programmatic Environmental Impact Statement

PNGV Partnership for New Generation Vehicles

PSO Program Secretarial Officer

R&D research and development

RIF involuntary separation

SBSS Science-Based Stockpile Stewardship

SEAB Secretary of Energy Advisory Board

SLEP Stockpile Life Extension Program

SMIC Stockpile Management Integration Council

EXTERNAL EXPERTS CONSULTED BY GAO
========================================================== Appendix IV

DOE'S LABORATORY OPERATIONS BOARD,
EXTERNAL MEMBERS

Dr.  John P.  McTague (Vice Chairman)
Vice President, Technical Affairs
Ford Motor Company

Dr.  Robert P.  Bringer
Staff Vice-President, Environmental Technology and Services (Retired)
3M Corporation

Dr.  Paul A.  Fleury
Dean, School of Engineering
University of New Mexico

Dr.  Paul Gilman
Executive Director, Commission of Life Sciences
National Academy of Sciences

Dr.  Alexander MacLachlan
Senior Vice President and Chief Technical Officer (Retired)
E.  I.  du Pont de Nemours and Company

Dr.  Maxine Savitz
General Manager, Allied Signal Aerospace
Ceramic Components

Rear Admiral Robert H.  Wertheim, U.S.  Navy (Retired)
Consultant
Science Applications International Corporation

GALVIN TASK FORCE

Robert Galvin (Chairman)
Chairman, Executive Committee
Motorola, Inc.

Dr.  Henry Kendall
Professor of Physics
Massachusetts Institute of Technology

Dr.  Herbert York
Director Emeritus
Institute for Global Conflict and Cooperation

SECRETARY OF ENERGY ADVISORY BOARD

Dr.  Walter E.  Massey (Chairman)
President
Morehouse College

Dr.  Leon Lederman
Director Emeritus
Fermi National Accelerator Laboratory

Marilyn Lloyd
Consultant
The Lloyd Group

INSTITUTE FOR DEFENSE ANALYSES

Michael Leonard
Division Director
Strategy, Forces and Resources Division

Dr.  David R.  Graham
Assistant Director
Strategy, Forces and Resources Division

Dr.  James D.  Silk
Assistant Director
Science and Technology Division

YERGIN TASK FORCE

Dr.  Larry Papay
Senior Vice President and Manager of Research and Development
Bechtel Corporation

OTHER

Dr.  Alvin W.  Trivelpiece
Director
Oak Ridge National Laboratory

SCOPE AND METHODOLOGY
=========================================================== Appendix V

To determine the recommendations that have been made by past advisory
groups and the actions DOE has taken in response to these
recommendations, we identified findings and recommendations from past
studies on DOE's national laboratories.  While we examined studies on
the laboratories dating back 25 years--to gain a more complete
understanding of findings from past reviews of the laboratories'
operations--as agreed with DOE, we concentrated on only the most
recent advisory groups' recommendations to determine DOE's specific
responses.  We provided DOE with a list of the recommendations from
the eight most recent advisory group studies and asked the Department
to indicate what actions it has taken and is taking to address each
of these recommendations.  Appendix III contains DOE's response.
Appendix II lists all of the past studies of the laboratories'
operations.

To provide an outside perspective on the actions DOE indicated it has
taken in response to the recommendations of past advisory groups, we
interviewed 18 external experts.  We judgmentally selected these
experts on the basis of their experience and familiarity with DOE's
laboratory system.  We included persons external to DOE and the
executive branch who were involved in completing each of the eight
most recent studies with recommendations.  Our list of experts
included present external members of DOE's Laboratory Operations
Board, selected members of the Galvin Task Force, selected members of
the Secretary of Energy Advisory Board, and representatives of the
Institute for Defense Analyses.  DOE concurred with our list and did
not suggest additional experts.  Before conducting our interviews, we
provided each expert with the list of recommendations from past
advisory groups and DOE's responses to the recommendations.  We then
asked the experts to provide their comments on those responses.  A
list of the external experts we contacted appears in appendix IV.

To obtain the views of laboratory officials, we visited the following
laboratories:  Sandia National Laboratory and Los Alamos National
Laboratory in New Mexico, Lawrence Berkeley National Laboratory,
Lawrence Livermore National Laboratory, and the Stanford Linear
Accelerator Center in California, and the National Renewable Energy
Laboratory in Colorado.  We asked officials at these laboratories to
comment on the list of recommendations from past advisory groups and
DOE's responses, as well as identify any actions taken.  We also
interviewed DOE officials responsible for overseeing these
laboratories.  These officials were from DOE's operations offices in
Albuquerque, New Mexico, and Oakland, California, and DOE's site or
area offices in Albuquerque and Santa Fe, New Mexico; Berkeley,
Livermore, Palo Alto, California, and Golden, Colorado.

We conducted our review from December 1997 through August 1998 in
accordance with generally accepted government auditing standards.

(See figure in printed edition.)Appendix VI
COMMENTS FROM THE DEPARTMENT OF
ENERGY
=========================================================== Appendix V

(See figure in printed edition.)

(See figure in printed edition.)

(See figure in printed edition.)

(See figure in printed edition.)

The following are GAO's comments on the Department of Energy's letter
dated August 3, 1998.

1.  We agree that DOE's multiprogram laboratories can be focused on
more than a single mission area and that varying weights can be
assigned to that mission area at different laboratories.  We also
agree with DOE's comment that further focusing of efforts at the
laboratories is needed.  This is a common finding from past advisory
groups that have studied the laboratories.

2.  We agree that the DOE and laboratory officials on the Laboratory
Operations Board are in a position to recommend management
improvements.  Experts we interviewed told us that the Board has had
a positive influence.  But, as an advisory group, the Board does not
have the authority to direct the implementation of needed changes; it
must rely on its internal members to effect change.  As we stated in
our report, the Board's limited advisory role is not a substitute for
strong DOE leadership and organizational accountability.

As we also stated in our report, the Department's efforts to
integrate goals and research programs through activities such as
roadmapping are useful.  However, we believe that such efforts will
be successful only if they are integrated into DOE's budget process.
Although such integration has not yet taken place, we applaud DOE's
plans to integrate the roadmapping process with the Department's
budget process.

3.  DOE reports that the laboratories have made progress in working
in partnerships and as a system, noting that laboratory directors
themselves have initiated further multilaboratory coordinated
efforts.  Laboratory directors we contacted also cited these
partnerships but commented that they were often created without DOE's
direction and guidance.  Furthermore, one laboratory director said
that DOE should establish more lead laboratories for these
partnerships and that too many laboratories are involved in some
programs.

As we stated in our report, weaknesses in DOE's ability to manage the
laboratories as an integrated system of research and development
facilities is one of the most persistent findings from past advisory
groups.

4.  Although we did not evaluate the improvements DOE cited in
reducing its oversight of the laboratories, experts and laboratory
officials credited DOE with reducing its oversight of the
laboratories as a major change in response to the Galvin Task Force's
report.  Also, we did not analyze the effect of micromanagement on
research and development as part of this report.

5.  Whether the Department considers the past studies'
recommendations as goals or single objectives to be met, we believe
that DOE needs to measure its progress in meeting these goals or
objectives.  DOE is not doing so yet.  Although DOE is developing
performance measures for its laboratory contractors as part of its
"performance-based management system," it has not yet established
performance measures to ensure that its own ongoing reform efforts
are managed effectively.  Without such measures, DOE cannot determine
how much progress it has achieved.

We also agree with DOE that senior management's commitment to
performance-based management and an improved planning and budget
process is essential to the achievement of a long-term, stronger
management system for its laboratory system.  We believe an effective
implementation plan with performance measures, milestones, and a
system for tracking progress will assist the Department in obtaining
this commitment and holding these managers accountable for achieving
the desired results.

While we agree with the Department that it is important to value
outcomes as well as outputs, we believe that past advisory groups'
recommendations have often been repeated in subsequent studies
because DOE has been unable to effectively measure the outcomes and
outputs of the reform process.  Without adequate measures for
tracking progress, future studies are likely to find the same
management deficiencies.

MAJOR CONTRIBUTORS TO THIS REPORT
========================================================= Appendix VII

Gary Boss, Assistant Director
Thomas Kingham, Evaluator-in-Charge
Michael E.  Gilbert, Team Leader
William Lanouette, Senior Evaluator
James Crigler, Senior Evaluator
Duane Fitzgerald, Technical Adviser
*** End of document ***