January 2001 Major Managem

Challenges and 

Program Risks

Department of State

GAO-01-252

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Letter 

Overview 

Major 

Performance 

and 

Accountability 

Challenges

Related GAO 

Products

Performance 

and 

Accountability 

Series
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of th

Page 3 GAO-01-252 State Depart

United States General Accounting Office

Washington, D.C. 20548

January 2001

The President of the Senate

The Speaker of the House of Representati

This report addresses the major performa

accountability challenges facing the Depa

State. As the lead agency representing U.S

overseas, the Department of State is veste

range of responsibilities, including formul

policy on diverse international issues; coo

implementing U.S. government programs 

overseas; and influencing other countries 

policies and practices consistent with U.S

such, the Department has responsibility fo

other things, assisting U.S. businesses ove

providing services to U.S. citizens abroad

passports and visas, participating in intern

control programs, and providing security 

personnel and facilities overseas. This rep

summary of actions that State has taken a

under way to address these challenges. It 

further actions that GAO believes are nee

analysis should help the new Congress an

administration carry out their responsibil

improve government for the benefit of the 

people. 

This report is part of a special series, first 

January 1999, entitled the Performance an

Accountability Series: Major Management 

and Program Risks. In that series, GAO ad

Congress that it planned to reassess the m

and criteria used to determine which fede

government operations and functions sho

highlighted and which should be designat

risk.” GAO completed the assessment, con
Page 4 GAO-01-252 State Departme

comments provided on a publicly available e

draft, and published its guidance document, 

Determining Performance and Accountabilit

Challenges and High Risk (GAO-01-159SP), i

November 2000. 

The full 2001 Performance and Accountabilit

contains separate reports on 21 agencies—c

each cabinet department, most independent 

and the U.S. Postal Service. The series also i

governmentwide perspective on performanc

management challenges across the federal g

As a companion volume to this series, GAO i

update on those government operations and 

that its work identified as “high risk” becaus

their greater vulnerabilities to waste, fraud, a

mismanagement or major challenges associa

their economy, efficiency, or effectiveness. 

David M. Walker

Comptroller General 

of the United States
Page 5 GAO-01-252 State Depart
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As the lead agency for the conduct of fore

Department of State has enormous respon

successful practice of U.S. diplomacy is e

ensuring security at home, laying the grou

better jobs and a higher standard of living

healthier environment, and assuring safe t

ongoing conduct of business abroad. To h

these responsibilities, State maintains a w

network of operations at almost 260 diplo

consular posts worldwide and supports th

about 30 other U.S. government agencies. 

its international objectives, it must take in

multiple and often competing intentions a

these agencies, other governments and or

public opinion, and the Congress, as well 

resources. 

In carrying out its mission, the Departmen

number of significant performance and ac

challenges, as our work has shown. These 

cover a wide spectrum of U.S. governmen

around the world affecting Americans at h

abroad. 
Page 7 GAO-01-252 State Depart

Embassy Security State’s most critical infrastructure need is 

the protection of U.S. embassies and othe

facilities in response to the increased thre

terrorism. State has taken many steps to u

security at its diplomatic missions around 

since the 1998 bombings in Africa. These 

include deploying hundreds of additional s

overseas and enhancing physical security 

variety of means. In addition, State has be

some of its most vulnerable embassies an

with more secure facilities. State estimate

cost $15 billion over 10 to 15 years for pro

than 180 locations. Our work has shown t

face several challenges in administering th

security construction program, including 

long-term planning for the program and w

the Congress in charting the future course

and funding levels for the program. We re

that State develop a long-term, capital con

to assist decisionmakers in reaching cons

• Improve the security and maintenance of U.S. f

overseas 

• Help decrease the level of illegal drugs entering 

United States 

• Address the threats illegal immigration continue

to Americans at home

• Address additional challenges to building a hig

performing organization
Page 8 GAO-01-252 State Departme

program. Successful implementation of over

security enhancements and construction act

improve the safety and security of U.S. empl

working abroad. 

Drug Control Illegal drugs, primarily cocaine and heroin, c

threaten the health and well-being of Americ

The principal source of cocaine and heroin e

United States is South America, and specific

Colombia. In 1993, the United States develop

designed to reduce the production of illegal 

South America and stem their flow through L

America and the Caribbean. Our work has sh

billions of dollars invested by the United Sta

foreign countries to carry out this policy have 

the arrest of major drug traffickers and the s

large amounts of drugs, but the availability o

the United States has not been materially red

continue to attack this problem, the Congres

provided more than $1 billion in counternarc

assistance to Colombia, which State will larg

In October 2000, we reported that State had e

difficulty effectively managing past assistanc

Colombia and recommended that State deve

implementation plans to ensure that the new 

is well managed and used effectively. We also 

a sustained long-term commitment will be ne

notably reduce the level of illegal drugs ente

United States.

Illegal Immigration State is responsible for providing expeditiou

processing overseas to qualified applicants. 

conjunction with the U.S. Immigration and 

Naturalization Service, must also prevent the 

those who are a danger to U.S. security or ar

remain in the United States illegally. Over th

State has introduced new technologies, equi

controls designed to improve visa processin
Page 9 GAO-01-252 State Depart

reduce the incidence of fraud. However, b

work and that of State’s Office of Inspecto

(OIG), visa processing remains a significa

for the Department. The reasons for these 

include staffing shortages, inexperienced 

insufficient staff training, and difficulties 

visa antifraud programs. State recognizes 

remain vigilant in these areas to further re

vulnerability of the visa system and has se

initiatives underway or completed to coun

Additional 

Challenges

In addition to the specific performance ch

above, State faces several other agencywi

performance and accountability challenge

its ability to become a high-performing or

These challenges are (1) better utilizing th

Government Performance and Results Ac

help achieve its objectives, (2) enhancing 

communication and information technolo

security, (3) improving financial managem

(4) adopting modern human capital practi

(5) restructuring the U.S. overseas presen

the efficiency and effectiveness of operati

recognized these challenges and has demo

commitment to addressing them, as follow

• State has improved its strategic and pe

planning to better capture its goals and 

but its performance reporting needs to 

demonstrate progress toward meeting 

• State has implemented many of our in

technology and security recommendat

new challenges have emerged as State 

developing an interagency technology 

its inherent security risks. 

• State has made progress toward its goa

financial systems but still needs to brin

into full compliance with federal finan
Page 10 GAO-01-252 State Departme

requirements and resolve internal contro

weaknesses. 

• Consistent with GAO studies of best pract

performance organizations, State’s in-hou

highlighted the importance of developing 

resource strategy that is in line with its m

• Over the years, we have recommended th

reassess its overseas structure in light of 

political, economic, security, and technol

requirements; and, this effort is currently 

We believe that addressing these issues will b

the Department’s ability to effectively carry o

foreign policy.
Page 11 GAO-01-252 State Depart

y g

The Department of State is vested with a w

responsibilities, including formulating U.S

diverse international issues; coordinating 

implementing U.S. government programs 

overseas; and influencing other countries 

policies and practices consistent with U.S

such, the Department has responsibility fo

other things, assisting U.S. businesses ove

providing services to U.S. citizens abroad

passports and visas, participating in intern

control programs, and providing security 

government personnel and facilities overs

maintains a network of operations in 160 

employs a staff of over 50,000 U.S. and for

and maintains thousands of facilities over

support U.S. activities. 

This report summarizes our recent and on

and that of State’s Office of Inspector Gen

concerning the performance and managem

challenges and issues State faces in accom

of its key strategic and diplomatic readine

its overall mission. State has identified 16 

it will pursue as it conducts diplomatic ac

public diplomacy overseas as part of its e

represent the United States. Underlying th

Department and other agencies to attain t

internationally is diplomatic readiness, wh

the personnel, resources, and infrastructu

Department needs to carry out its own mi

support other U.S. agencies abroad in pur

missions. State’s strategic and diplomatic 

goals that we selected to review are (1) es

maintaining infrastructure and operating 

enable employees to pursue policy object

respond to crises—in particular, State’s ef

improving the security and maintenance o

facilities; (2) reducing the levels of illegal 

the United States; and (3) controlling how 

and nonimmigrants enter and remain in th
Page 12 GAO-01-252 State Departme

States. We also discuss additional manageme

challenges in the diplomatic readiness area t

has been dealing with for years. These includ

to (1) improve strategic and performance pla

consistent with the 1993 Government Perfor

Results Act (Results Act); (2) enhance inform

technology and security, specifically efforts t

common interagency communications platfo

(3) improve financial management; (4) addre

capital issues; and (5) restructure overseas o

consistent with U.S. foreign policy priorities

Improve the 

Security and 

Maintenance of U.S. 

Facilities Overseas 

The need to adequately protect employees a

families from threatened terrorist attacks ov

very well be the single most important mana

issue currently facing the State Department. 

1998 bombings of the U.S. embassies in Nair

and Dar es Salaam, Tanzania, immediately br

focus the seriousness of this security challen

response to those attacks, State determined 

only needs to enhance security at all existing 

but that in the long term it must replace over 

facilities where existing facilities may be vul

attack. To accomplish these security enhanc

State had to deal with challenges in hiring an

personnel to protect and replace its overseas 

infrastructure and in acquiring the necessary 

equipment. Linked to these challenges are th

efforts of the Department to work with other 

formulate a strategy for effectively addressin

overseas presence. Further, the Department 

to face long-standing difficulties in effectivel

maintaining its facilities to avoid premature 

deterioration. 

Security Upgrades Since the bombings in Africa, State has taken 

steps to upgrade security at its diplomatic m

around the world. These steps have included 
Page 13 GAO-01-252 State Depart

hundreds of security agents overseas to a

security; enhancing the physical security 

through several means, such as installing 

resistant window film; establishing survei

detection teams to identify hostile surveil

monitoring; and purchasing additional pro

buffer zones for facilities. State’s OIG repo

Department did many things well in admi

almost $1.5 billion it received in emergenc

supplemental funding shortly after the bo

that senior-level attention was instrument

Department’s effective use of these funds

added that, for example, considerable pro

made in hiring, assigning, and training new 

personnel. 

Although State has made these improvem

realized that the funds originally allocated 

construction upgrades to improve the sec

existing facilities would not be sufficient. 

bombings, State allocated $181 million for 

security upgrades and electronic equipme

installations. As surveys were conducted 

complete information became available, S

determined it could potentially cost about 

more to complete the security enhanceme

received about $200 million for fiscal year 

address these requirements and may make 

requests and/or take other actions, such a

funds from other programs, to achieve ma

objectives intended to better protect emp

their families overseas.
Page 14 GAO-01-252 State Departme

Embassy and 

Consulate 

Construction

Although the Department of State is making 

enhancements at all U.S. embassies and con

about 80 percent of overseas U.S. diplomatic 

still do not have adequate security and may b

vulnerable to terrorist attack until new facili

built. To begin replacing the most vulnerable 

and consulates, the Congress appropriated a

$1.1 billion for fiscal years 1999, 2000, and 20

State’s capital security construction program

estimated that $15 billion or more will be ne

replacement projects in over 180 locations a

world where existing facilities may be vulne

has entered the construction phase on seven 

embassy and consulate projects since the 19

bombings. It will take many years before the 

Department makes substantial headway in r

of its vulnerable facilities. 

Figure 1 shows the U.S. Embassy in Nairobi, 

after the August 1998 bombing and figure 2 s

architect’s rendition of the new embassy curr

construction.
Page 15 GAO-01-252 State Depart

Figure 1: The U.S. Embassy in Nairobi, Kenya, A

1998 Bombings

Source: State Department.
Page 16 GAO-01-252 State Departme

Figure 2: Architect’s Drawing of the New Embassy Now Under Construction in Nairo

Source: State Department.

While State has identified a number of facilit

priority for replacement and has several stud

underway that should help it manage the ove

program, it has not prepared a long-term cap

construction plan. Long-term capital plannin

practice that has proven useful to other orga

the public and private sector for controlling c

and providing a rationale for allocating fund

recommended that State develop a long-term 

identifies proposed construction projects an

costs, and a timetable for completion. The p

cover at least 5 years and be updated annual

would enable State to better support its fund

requests, support efforts to reach consensus 

decisionmakers in the executive and legislat
Page 17 GAO-01-252 State Depart

branches on the program’s requirements, 

improve accountability for program result

Facility Maintenance Facility maintenance has been a long-stan

infrastructure challenge for the Departme

1990’s, we put the Department’s managem

overseas real property on our high-risk lis

insufficient maintenance of facilities. The 

causes of State’s maintenance problems w

funding, professional attention to mainten

the post level, and programs for maintenan

In 1995, we removed this function from th

because State had surveyed maintenance 

overseas and made some improvements. I

OIG stated that while State has made som

maintaining its facilities, fundamental cha

remain. State’s unfunded maintenance and 

requirements in 1999 exceeded $100 milli

than 650 buildings overseas. About 230 of 

were categorized by State as being in una

condition due to unfunded maintenance r

exceeding $100,000 each. 

Department officials largely attributed co

the past several years as a reason for the p

maintained properties. State’s OIG agreed 

an issue but has reported that the Departm

do more to address its maintenance and r

as a management concern. Specifically, th

General has said that the Department nee

define what is an acceptable level for its b

maintenance requirements and to develop 

that will address the costs to reduce the b

acceptable level.

Key Contact Susan S. Westin, Managing Director

International Affairs and Trade
Page 18 GAO-01-252 State Departme

(202) 512-4128

westins@gao.gov

Help Decrease the 

Level of Illegal 

Drugs Entering the 

United States

The U.S. international drug control strategy 

reducing the production and flow of cocaine 

before they reach the United States. The Dep

State plays a key role in implementing the st

which is designed to reduce drug trafficking 

source countries of Colombia, Bolivia, and P

transit areas within the Caribbean, Central A

Mexico. In July 2000, the Congress provided 

other U.S. agencies more than $1 billion to h

illegal drug activities in the source and trans

Figure 3 illustrates the rise in estimated pote

cocaine production in Colombia, the primary 

cocaine shipped to the United States.
Page 19 GAO-01-252 State Depart

Figure 3: Estimated Potential Colombian Cocai

1995-99

Source: State Department.

Since fiscal year 1996, hundreds of million

assistance have been provided to Colomb

some of the assistance has been of limited 

because of inadequate planning and imple

State and other U.S. agencies. For exampl

provided helicopters to the Colombian Na

and military without sufficient spare parts 

operational and maintenance support. Th

assistance program, funded for 2 years, ca

additional equipment to be provided to th

military and the National Police, yet State 

agencies have not developed an implemen

ensuring that adequate logistical support, 

infrastructure sustain the effort. To help e

0

100

200

300

400

500

600

1995 1996 1997 1998 199

Metric tons
Page 20 GAO-01-252 State Departme

problems in supporting U.S. provided equipm

Colombia do not recur, we recommended in 

2000 that the secretaries of State and Defens

training and logistical support requirements 

future funding requirements to support U.S.-

equipment, and complete U.S. implementatio

coordinate with Colombian officials to ensur

equipment provided as part of any future U.S

is adequately supported. 

Key Contact Jess T. Ford, Director

International Affairs and Trade

(202) 512-4268

fordj@gao.gov

Address the Threats 

Illegal Immigration 

Continues to Pose 

to Americans at 

Home

The State Department, through its overseas 

missions, processes about 9 million immigra

nonimmigrant visa applications annually. Att

falsify, alter, or counterfeit U.S. visas or obta

documents by fraudulent means are a consta

In our March 1999 report on visas issued to r

workers, we reported that the State Departm

Immigration and Naturalization Service were 

about visa fraud but could not establish the fu

the problem. Their knowledge of visa fraud i

information developed primarily from fraud 

investigations and the visa screening proces

Department of State has maintained a strong 

on the need to improve the security of our b

the immigrant and nonimmigrant visa proces

a significant challenge. 

The Department has completed or has under

number of initiatives to counter visa fraud. T

include setting up a machine-readable visa p

all visa-issuing posts, providing worldwide a

overseas posts regarding fraudulent docume
Page 21 GAO-01-252 State Depart

improving the effectiveness of the name c

system, and increasing efforts to counter 

fraud. The Department also continues to r

consular lookout systems in an effort to b

individuals who should not receive visas. 

improved its computer-generated informa

available to consular and border-crossing 

prevent visa fraud and illegal entry by terr

criminals, alien smugglers, or simply inten

immigrants. 

State, however, still faces several challeng

preventing visa fraud. These include staff

inexperienced staff, and insufficient train

consular line officers. In addition, the OIG 

problems in State’s management of antifra

such as insufficient analysis of fraud trend

inadequate supervision of overseas antifra

is now working to correct these problems

performance goals and indicators in its fis

Performance Plan address planned improv

visa process, they do not specifically addr

other management challenges we identifie

inadequate interagency coordination, and 

visa processing. 

Another challenge to controlling illegal im

the timely implementation of the border c

program. Border crossing cards are issued 

passports and visas to Mexican nationals 

frequently across the border into the Unite

has issued over 2.5 million cards since Ap

contain the fingerprints and electronic ph

the bearer. See figure 4 below for a sampl

crossing card.
Page 22 GAO-01-252 State Departme

Figure 4: Sample of a Border Crossing Card

Source: State Department.

The OIG identified numerous problems with 

program. For example, the U.S. Immigration 

Naturalization Service does not have the pro

capacity to produce the number of cards req

statute. The Department needs supplementa

production capability to overcome this prob

is also an urgent need to expand and upgrad

criminal record databases used to adjudicate 

OIG concluded that a new, expanded biometr
Page 23 GAO-01-252 State Depart

would make it possible to begin implemen

issuing a new generation of biometric-bas

card-type nonimmigrant visas at all consu

Key Contact Jess T. Ford, Director

International Affairs and Trade

(202) 512-4268

fordj@gao.gov

Address Additional 

Challenges to 

Building a Highperforming 

Organization

State’s management functions provide the 

support for U.S. government operations a

world. Therefore, it is incumbent upon St

become a high-performing organization. T

needs to choose the best strategies for int

organizational components, activities, cor

and resources to support mission prioritie

with concerns that we and State’s OIG rai

years, the Department is currently seekin

better utilize the Government Performanc

Act process to improve its strategic and p

planning to better achieve overall mission

operational objectives. State is also enhan

communications and information technol

computer systems security, including dev

interagency technology platform, and imp

financial management systems. Efforts ar

underway to address human capital issue

devising options for streamlining and righ

overseas operations. 

State’s human capital problems can be see

broader pattern of human capital shortco

have eroded mission capabilities across th

government. See our High-Risk Series: An 

1

 Biometric identifiers include fingerprints and hand
Page 24 GAO-01-252 State Departme

(GAO-01-263, January 2001) for a discussion 

capital as a newly designated governmentwi

area.

Improving 

Performance 

Planning and 

Reporting

The Results Act provides a framework for re

management challenges and for providing gr

accountability of State’s programs and opera

required by the Results Act, State has clearly 

its strategic and diplomatic readiness goals o

security, economic growth, and more. Our re

State’s performance plans for fiscal years 19

2001 indicated that State continues to impro

planning but additional improvements are ne

measure and assess performance in a meani

The Department’s fiscal year 1999 Performan

the first one required under the Results Act, 

numerous foreign policy accomplishments fr

signing of peace agreements to trade agreem

did not adequately demonstrate State’s level 

or participation in achieving the desired outc

State’s fiscal year 2001 performance plan pro

more detail on its intended performance com

prior years’ plans. The fiscal year 2001 plan u

format that attempts to capture more of Stat

performance goals and measures. It also ind

clear division of responsibility among State’s 

geographic and functional bureaus. Howeve

approach of listing individual performance g

measures by bureau does not lend itself to as

agency’s performance as a whole. Further, th

Department has not developed overall priori

achieving its strategic goals, and, consequen

overall basis for allocating resources to prio

State’s fiscal year 1999 Performance Report 

adequately demonstrate State’s level of succ

achieving desired outcomes or the way in wh

actions actually led to the achievement of de
Page 25 GAO-01-252 State Depart

The performance report generally provide

list of accomplishments under each of the 

goals and an annex of information on the 

selected goals. However, it does not provi

assessment of the progress made toward 

Department’s goals. For example, under t

reduce illegal drugs entering the United S

does not specify how establishing police t

academies, which are a measure of perfor

it combat the availability of illegal drugs. A

was unclear how much the Department co

some of the outcomes it discussed or how 

would be achieved in the future. For exam

regional stability strategic goal, the Perfor

states that “U.S. access to Persian Gulf oil 

continued uninterrupted” but does not ide

Department contributed to that positive ou

expanding foreign markets, State did not i

would meet its unmet targets for complet

investment treaties with target countries.

State officials acknowledged that the perf

needs to address the management challen

OIG and we have identified. Department o

that they intend to form strategic goal tea

a more focused fiscal year 2002 Performa

teams, led by senior managers, will identi

prioritize performance goals. Officials als

amend the fiscal year 2002 plan to make it 

comprehensive, particularly in the areas o

information technology modernization an

financial management, and hiring and trai

discussed below. Effective planning in the

areas would help State to become a high-p

organization.

Key Contact Susan S. Westin, Managing Director

International Affairs and Trade
Page 26 GAO-01-252 State Departme

(202) 512-4128

westins@gao.gov

Enhancing 

Overseas 

Communication, 

Information 

Technology, and 

Computer Systems 

Security 

State relies heavily on information technolog

support its worldwide operations. While Stat

updated its systems infrastructure and impro

capabilities at overseas locations, the Depar

ability to collaborate with other foreign affai

via modern technology capabilities needs to 

enhanced. Adding to this modernization cha

computer security concerns. Because of the 

complexity, and importance of State’s inform

technology program, we will continue to mo

progress with implementing the common pla

modernizing its information systems, and im

computer security. 

State is leading an interagency effort, recom

the Overseas Presence Advisory Panel,2

 to d

system that meets the collective knowledge 

management and collaboration needs of the 

overseas foreign affairs community. State ha

begun to take leadership in working with oth

agencies with an overseas presence and is in 

stages of planning for a common technology 

has established an interagency technology g

has begun defining system requirements for 

platform. The group is establishing project m

developing cost estimates, and developing a 

implementation plan. Pilot projects for two p

currently under development. If the common 

2

 The Overseas Presence Advisory Panel, an independen

convened by the Secretary of State, was formed in 1999 

size, composition, and management of the U.S. oversea

the panel’s November 1999 report, it recommended that 

Department develop and implement a strategy for stand

information and communications networks at all posts w

all agencies with the connectivity they need.
Page 27 GAO-01-252 State Depart

to become a reality, State will have to over

obstacles and get agreement from platform 

requirements. Further, it will have to do th

defining its own technical architecture and 

address pervasive computer security wea

could increase with greater connectivity. 

State must continue to work hard to over

technology management system weaknes

security concerns. In 1998, we reported th

disciplined information technology projec

processes, investment controls, and an en

architecture. Because of these weaknesse

concluded that State could not be assured 

making the most cost-effective system inv

decisions, that these systems would perfo

expected, or that its cost estimates were s

recommended that State make the develo

fully implemented information technology 

investment process a top priority, includin

development of a comprehensive architec

agreed with our recommendations and ha

progress in implementing them, but it nee

this effort. 

Previous GAO and OIG reports have cited 

system security problems, including acces

security program management weaknesse

significant challenges for the Department

during computer security testing 2 years a

able to access sensitive, unclassified infor

virtually undetected. In response, the Dep

worked hard to upgrade and secure its inf

technology and made real progress in imp

many of our recommendations, including c

and responsibilities, establishing a compu

response team, and requiring the use of ri

management by all project managers. Stat

take steps to ensure that this progress is m

that all audit recommendations and identi
Page 28 GAO-01-252 State Departme

vulnerabilities are addressed, that automated 

detection programs are expanded, and that a

security management responsibilities are fur

clarified. Absent these needed improvement

computer networks will remain vulnerable t

exploitation and unauthorized access.

Key Contact Joel Willemssen, Managing Director

Information Technology

(202) 512-6408

willemssenj@gao.gov

Improving 

Financial 

Management 

Capabilities

State has made progress toward resolving its 

long-standing problems caused by the absen

effective financial management system that 

managers in making “cost-based” decisions. 

year 1997, State has received unqualified opi

financial statements. While not meeting the s

deadlines, State has steadily improved the ti

its reporting. State has also resolved a numb

internal control weaknesses and is proceedi

planned efforts to improve its systems and p

needed to protect its assets and routinely pr

timely and reliable financial information. 

State needs to continue to bring its systems 

compliance with federal financial systems re

State also needs to resolve internal control w

to ensure that timely and reliable financial in

is available so Department officials can mak

decisions that promote effective and efficien

federal funds. According to the independent 

report attached to State’s Accountability Rep

Fiscal Year 1999, State’s financial manageme

do not comply with certain laws and regulati

including the Chief Financial Officers Act of 

act requires the development and maintenan
Page 29 GAO-01-252 State Depart

integrated accounting and financial manag

that, among other things, provides for com

reliable, and timely information that meet

information needs of the agency’s manage

systematic measurement of performance. 

Key Contact Gregory D. Kutz

Director, Financial Management and Assu

(202) 512-9095

kutzg@gao.gov

Human Capital 

Practices Need to 

Be Updated 

Although State has traditionally attracted 

nation’s most talented people, a recent De

study3

 concluded that an increasingly com

market and expanded private sector oppo

geographic mobility have drawn potential 

Service Officers into other professions. Ac

study, the challenges that State faces in re

retaining top-quality employees fall into s

These include the need for State to (1) est

link between current performance and pr

(2) improve the quality of life at overseas 

(3) improve the quality of its management

The Overseas Presence Advisory Panel al

that State needed to reform its human res

practices because it does not currently ha

flexibility, resources, or strategic organiza

to support its mission. The panel visited 2

posts in conducting its work and found th

matters topped the list of issues discussed

reported that employees were dissatisfied 

evaluation processes, career advancemen

3

 The 1999 study, titled “The War for Talent,” was pre

McKinsey and Company for State. It compared the v

employees and managers to those in top-performing 
Page 30 GAO-01-252 State Departme

opportunities, sensitivity to lifestyle issues, t

of autonomy and responsibility offered by th

positions, and the quality of management. Em

wanted, among other things, more training in 

leadership, management, and new issues. Th

recommended that State develop a compreh

human resource strategy that is based on a d

statement of its mission, definition of the wo

done, and identification of personnel require

that State develop and implement a recruitm

designed to fulfill these needs. This approach 

strategically aligning human capital with org

goals and objectives is consistent with our st

best practices used by high performance org

and similar studies done by other organizatio

According to State, it has begun to implemen

these recommendations. For example, it has 

develop a new, unified human resources stra

Department. The strategy will include a dom

overseas staffing picture along with a 5-year 

based on State’s overseas staffing model and 

budget presentation documents. To improve 

of life at its overseas posts, State has negotiat

work agreements with 126 nations and is rev

Department rules restricting employment op

for spouses of employees working overseas. 

developed a pilot, 360-degree review process 

allow employees to give meaningful feedbac

their supervisors performed as leaders, man

mentors—in a nonthreatening and construct

designed for personal and professional deve

The Department also plans to expand leader

management training, increase security train

reshape the reporting and policy functions, a

ways of making the assignment process mor

responsive to management and employee ne
Page 31 GAO-01-252 State Depart

Key Contact Susan S. Westin, Managing Director

International Affairs and Trade

(202) 512-4128

westins@gao.gov

Efforts to Realign 

the Workforce With 

Mission 

A key challenge for the State Department 

agencies operating overseas is how to adj

overseas presence to the new economic, p

security, and technological requirements o

century. Presently more than 50,000 Amer

service national, and contract employees 

government locations. In recent years, we 

concerns about the need to reexamine the 

presence in light of increased threats of te

and the billions of dollars in annual costs 

with overseas operations. We have recom

State reexamine the way it conducts over

administrative functions, such as relocatin

employees. From our work, we also have 

State explore options for regionalizing cer

and making greater use of technology and 

to achieve efficiencies and improve perfo

In March 2000, State established a high-lev

committee to determine the right size and 

of overseas posts. The work of this comm

ongoing, with interagency pilot projects u

designed to determine if the U.S. governm

the right things with the right people in th

Progress in addressing right-sizing issues 

challenges, including State’s limited autho

influence over the staffing decisions of ot

operating overseas. Continued high-level 

from all participating agencies will be nee

complete this effort. 
Page 32 GAO-01-252 State Departme

Key Contact Susan S. Westin, Managing Director

International Affairs and Trade

(202) 512-4128

westins@gao.gov
Page 33 GAO-01-252 State Depart

Overseas Security 

and Presence

State Department: Overseas Emergency S

Program Progressing, but Costs Are Incre

(GAO/NSIAD-00-83, Mar. 8, 2000).

Visa Issuance Visa Issuance: Observations on the Issuan

Religious Workers 

(GAO/T-NSIAD-00-207, June 29, 2000).

Visa Issuance: Issues Concerning the Reli

Visa Program (GAO/NSIAD-99-67, Mar. 26

State Department: Tourist Visa Processing 

Persist at U.S. Consulates (GAO/NSIAD-9

Mar. 13, 1998).

Drug Control Drug Control: U.S. Assistance to Colombi

Years to Produce Results (GAO-01-26, Oct

Drug Control: U.S. Efforts in Latin Americ

Caribbean (GAO/NSIAD-00-90R, Feb. 18, 2

Drug Control: Narcotics Threat From Col

Continues to Grow (GAO/NSIAD-99-136, J

Drug Control: Update on U.S.-Mexican Co

Activities (GAO/T-NSIAD-99-98, Mar. 4, 19

Drug Control: Observations on U.S. Count

Activities (GAO/T-NSIAD-98-249, Sept. 16, 

Drug Control: An Overview of U.S. Count

Intelligence Activities (GAO/NSIAD-98-14

June 25, 1998).
Page 34 GAO-01-252 State Departme

Strategic and 

Performance 

Planning

Observations on the Department of State’s F

Year 1999 Performance Report and Fiscal Ye

Performance Plan (GAO/NSIAD-00-189R, Jun

Observations on the Department of State’s F

Year 2000 Performance Plan (GAO/NSIAD-99

July 20, 1999).

The Results Act: Observations on the Depart

State’s Fiscal Year 1999 Performance Plan

(GAO/NSIAD-98-210R, June 17, 1998).

Managing for Results: Agencies’ Annual Perf

Plans Can Help Address Strategic Planning C

(GAO/GGD-98-44, Jan. 30, 1998).

Information 

Management

Foreign Affairs: Effort to Upgrade Informatio

Technology Overseas Faces Formidable Cha

(GAO/T-AIMD/NSIAD-00-214, June 22, 2000)

Department of State IRM: Modernization Pro

Risk Absent Full Implementation of Key Bes

(GAO/NSIAD-98-242, Sept. 29, 1998).

Year 2000 Computing Crisis: State Departme

Make Fundamental Improvements to Its Yea

Program (GAO/AIMD-98-162, Aug. 28, 1998).

Computer Security: Pervasive, Serious Weak

Jeopardize State Department Operations

(GAO/AIMD-98-145, May 18, 1998).
Page 35 GAO-01-252 State Depart

Foreign Affairs 

Organization and 

Management

State Department: Progress and Challenge

for Results (GAO/T-NSIAD/AIMD-00-254, J

State Department: Progress and Challenge

Addressing Management Issues 

(GAO/T-NSIAD-00-124, Mar. 8, 2000).

State Department: Major Management Ch

Program Risks (GAO/T-NSIAD/AIMD-99-9

Mar. 4, 1999).

Performance and Accountability Series: M

Management Challenges and Program Ris

Department of State (GAO/OCG-99-12, Jan

Foreign Affairs Management: Major Chall

the Department of State (GAO/T-NSIAD-9

Sept. 17, 1998).

State Department: Options for Reducing O

Housing and Furniture Costs (GAO/NSIAD

July 31, 1998).

International Affairs: Activities of Domest

(GAO/T-NSIAD-98-174, June 4, 1998).

State Department: Using Best Practices to 

Employees Could Reduce Costs and Impr

(GAO/NSIAD-98-19, Oct. 17, 1997).
Page 36 GAO-01-252 State Depart

Major Management Challenges and Progr

Governmentwide Perspective (GAO-01-24

Major Management Challenges and Progr

Department of Agriculture (GAO-01-242)

Major Management Challenges and Progr

Department of Commerce (GAO-01-243)

Major Management Challenges and Progr

Department of Defense (GAO-01-244)

Major Management Challenges and Progr

Department of Education (GAO-01-245)

Major Management Challenges and Progr

Department of Energy (GAO-01-246)

Major Management Challenges and Progr

Department of Health and Human Service

(GAO-01-247)

Major Management Challenges and Progr

Department of Housing and Urban Develo

(GAO-01-248)

Major Management Challenges and Progr

Department of the Interior (GAO-01-249)

Major Management Challenges and Progr

Department of Justice (GAO-01-250)

Major Management Challenges and Progr

Department of Labor (GAO-01-251)

Major Management Challenges and Progr

Department of State (GAO-01-252)
Page 37 GAO-01-252 State Depart

Major Management Challenges and Progr

Department of Transportation (GAO-01-25

Major Management Challenges and Progr

Department of the Treasury (GAO-01-254)

Major Management Challenges and Progr

Department of Veterans Affairs (GAO-01-2

Major Management Challenges and Progr

Agency for International Development (G

Major Management Challenges and Progr

Environmental Protection Agency (GAO-0

Major Management Challenges and Progr

National Aeronautics and Space Administ

(GAO-01-258)

Major Management Challenges and Progr

Nuclear Regulatory Commission (GAO-01

Major Management Challenges and Progr

Small Business Administration (GAO-01-2

Major Management Challenges and Progr

Social Security Administration (GAO-01-2

Major Management Challenges and Progr

U.S. Postal Service (GAO-01-262)

High-Risk Series: An Update (GAO-01-263
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