Human Capital: Selected Agency Actions to Integrate Human Capital Approaches to Attain Mission Results
Published: 2003-04-11T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: Successful strategic human capital management requires the integration of human capital approaches with strategies for accomplishing organizational missions and program goals. Such integration allows the agency to ensure that its core processes efficiently and effectively support mission-related outcomes. Based on the recommendations of various human capital experts, GAO identified six executive branch agencies that had taken key actions to integrate their human capital approaches with their strategic planning and decision making. The agencies were the Federal Emergency Management Agency, the General Services Administration, the Internal Revenue Service, the Social Security Administration, the U.S. Coast Guard, and the U.S. Geological Survey. These key actions may prove helpful to other agencies as they seek to ensure that their human capital approaches are aligned with their program goals.
section_title: What GAO Found
paragraphs: The executive branch agencies GAO reviewed have taken key actions to integrate their human capital approaches with their strategies for accomplishing organizational missions and to shift the focus of their human capital office from primarily compliance activities to consulting activities. Agency leaders included human capital leaders in key agency strategic planning and decision making and, as a result, the agencies engaged the human capital organization as a strategic partner in achieving desired outcomes relating to the agency's mission. Human capital leaders took actions to transform the agencies' human capital organizations by establishing clear human capital strategic visions, restructuring their organizations, and improving the use of technology to free organizational resources. Human capital leaders also promoted a transition to a larger strategic role for human capital professionals with their focus being more on consulting rather than compliance activities. The human capital profession is in transition from valuing narrowly focused specialists to requiring generalists, who have all the skills necessary to play an active role in helping to determine the overall strategic direction of the organization. Jointly, agency leaders and human capital leaders are having human capital professionals and agency line managers share the accountability for successfully integrating strategic human capital considerations into agency strategic planning and decision making.

section_title: Letter
paragraphs: Strategic human capital management is a pervasive challenge in the federal  government. In July 1998, we reported on agencies’ efforts to restructure  their personnel operations.  At that time, resource reductions and  changing missions, coinciding with the replacement of aging human capital  management information systems, were driving efforts in federal agencies  to restructure their human capital offices.  We found agencies’ additional  human capital challenges included the need to achieve a more strategic  integration of human capital approaches in the program decision-making  processes.
Fortunately, we are seeing increased attention to strategic human capital  management and a real and growing momentum for change.  Recent  legislation creating the Department of Homeland Security includes a  provision to establish a chief human capital officer (CHCO) in major  agencies of the federal government.  One of the functions of the CHCO is  to align the agency’s human capital policies and programs with  organization mission, strategic goals, and performance outcomes.  This  increased visibility of human capital organizations within federal agencies  underscores the increased recognition that strategic human capital  management is a vital enabler of organizational success.
We are addressing this report to you because of your ongoing interest in  federal human capital issues and how agencies can effectively manage their  human capital to achieve their organizational goals.  Our objective for this  report was to identify and provide examples of key actions agencies have  taken to integrate their human capital approaches with their strategies for  accomplishing organizational missions.  These actions may prove helpful to  other agencies as they seek to ensure that their human capital approaches  are aligned with their program goals.  We examined selected human capital  integration actions within the Federal Emergency Management Agency  (FEMA), the General Services Administration (GSA), the Internal Revenue  Service (IRS), the Social Security Administration (SSA), the U.S. Coast  Guard (USCG), and the U.S. Geological Survey (USGS).  These executive  branch agencies were chosen because various human capital experts  identified them as having taken actions to integrate human capital  approaches with strategies for accomplishing organizational missions and  program goals.
To meet our objective, we analyzed agency documents, such as planning  and organizational restructuring documents, and previous studies on  strategic human capital management.  In addition, we conducted  semistructured interviews with agency officials, human resource directors,  and line managers, who were involved in designing or implementing their  agencies’ human capital integration actions, to elicit their experiences and  conclusions about the agency actions they believed were most important to  the successful integration of their human capital function.  After reviewing  and analyzing their responses, we developed a framework to classify and  report on the types of identified actions.  We did not attempt to  independently verify the performance results that agencies attributed to  their actions.  Additionally, our selection process was not designed to  provide examples that could be considered representative of all the actions  at the agencies reviewed or of the federal government in general.  By  profiling an agency for a particular action, we do not mean to imply  complete success for the action or lack of success for others.  Appendix I  provides additional information on our scope and methodology.
subsections: section_title: Background
paragraphs: Similar to the federal government’s acknowledgment over the past decade  of the need to adopt a more businesslike approach to financial, information  technology, and performance-based management, the need for strategic  management of human capital is meeting increased recognition.  Since we  placed strategic human capital management on our high-risk list in 2001,  the President’s Management Agenda (PMA) subsequently identified  human capital as one of the five key governmentwide management  challenges facing the federal government.  The agenda specifically sets an  expectation for agencies to integrate their human capital strategies with  their organizational missions, visions, core values, goals, and objectives.  In  October 2002, the Office of Management and Budget (OMB) and OPM  approved revised standards for success in the human capital area of the  PMA, reflecting language that was developed in collaboration with GAO.   To assist agencies in responding to the revised PMA standards, OPM  released the Human Capital Assessment and Accountability Framework.
Our work and that of others has shown that high-performing organizations  link their human capital management systems—from the organizational  level down to individual employees—with their strategic planning and  mission accomplishment.  This means the function that has traditionally  been called personnel or human resources needs to make a fundamental  transformation, from being a strictly support function involved in managing  personnel processes and ensuring compliance with rules and regulations to  designing and implementing human capital approaches to attain the  agency’s strategic goals.  In addition, we found that effective human capital  professionals must have the appropriate preparation not just to provide  effective support services, but also to effectively consult with line  managers in tailoring human capital strategies to the unique needs of the  agency.
In March 2002, we released our Model of Strategic Human Capital  Management to help agency leaders more effectively lead and manage their  people and integrate human capital approaches into their strategic  planning and decision making.  The model emphasizes that successful  strategic human capital management requires the integration of human  capital approaches with strategies for accomplishing organizational  missions and program goals.  Such integration allows the agency to ensure  that its core processes efficiently and effectively support mission-related  outcomes.
section_title: Selected Agencies Took Actions to Integrate Human Capital Approaches with Organizational Missions
paragraphs: The executive branch agencies we reviewed took a range of actions as part  of efforts to integrate human capital approaches with strategies for  achieving organizational missions.  Top agency leaders and human capital  leaders were the primary initiators of the various actions taken.  In  addition, the agency leaders and human capital leaders jointly have  employed human capital professionals and agency line managers to share  the accountability for successfully integrating human capital approaches  into the planning and decision making of the agencies.
subsections: section_title: Agency Leaders Recognize Key Role of Strategic Human Capital Engagement
paragraphs: Top leadership in the agencies expected agency human capital leaders to  significantly contribute to strategic planning and decision making,  evidenced by their establishing human capital roles in positions that are  significant in the organizational hierarchy.  This acknowledges both the  commitment of the agency head to strategically managing the agency’s  people and the expected role that human capital leaders should contribute  to organizational success.  In addition, agency heads created entities, such  as human capital councils, to regularly review their agencies’ human  capital strategies and to ensure a data-driven, performance-oriented  approach to human capital management.  These groups of senior agency  officials, including both program leaders and human capital leaders,  provide oversight and are accountable for the integration and alignment of  the agencies’ human capital approaches.
section_title: Agency Leaders Ensure Human Capital Representation in Agency Strategic Planning and Decision Making
paragraphs: Although the so-called “seat-at-the-table” is significant, human capital  leaders are ultimately valued not by place, but by the value they add to the  agencies’ strategic human capital approaches in attaining organizational  goals.  According to a 1999 OPM report on strategic human capital  management, there has often been contention between human capital  leaders and agency leaders because of human capital’s role as “gatekeeper,”  that is, enforcing the law, rules, and regulations.  Now, with the  responsibility of the human capital function evolving, agency leaders are  positioning human capital leaders in roles where they have the opportunity  to more directly affect agency decisions and achievement of goals.
USCG officials told us that USCG’s Assistant Commandant for Human  Resources (HR) is a member of the agency’s senior management team and  is a full partner in the development of key USCG management decisions.   They stated that because of the Assistant Commandant’s organizational  status, USCG’s HR unit has participated earlier in strategic planning and  decision making, thus facilitating a smoother transition and execution of  ideas.  The officials cited USCG’s use of scenario-based planning as an  example of early involvement by USCG’s HR unit in agency strategic  planning and decision making.  Scenario-based planning is a technique  used by USCG for managing uncertainty and risk when planning into the  future.  The agency develops a few plausible future scenarios and then  plans how it would best respond to each scenario and what resources it  would need to respond.  For example, one scenario may describe  conditions that imply a greater need to interdict drugs in harbors than  another scenario, which may describe a world where the higher priority is  to intercept possible terrorist threats from the seas as far offshore as  legally possible.  Differing competency requirements and operating  concepts (e.g., time spent at sea) require different human capital  approaches in each of these scenarios.  With USCG’s migration to the  Department of Homeland Security and its added security responsibilities,  the agency’s plans for balancing resources among its many missions will  become increasingly important.
In the summer of 1998, senior USCG human capital staff members were  part of a core group of USCG planners who developed scenarios and  constructed the operational and support strategies to succeed in those  scenarios.  The group eventually created five very different worlds that  might exist in the year 2020, along with the "history" of events that led to  each of those, based on the combined factors of U.S. economic vitality, the  global demand for maritime services, the role of the federal government,  and threats to U.S. society.  The purpose of the five worlds was to create  the boundaries of the possible future, and allow leaders and planners to  create a strategy for USCG that would work well in each independent  scenario. The core group then analyzed the elements common to all five  strategies and crafted a core strategy.  The human capital strategies that  emerged became part of USCG’s official strategy, and simultaneously drove  the human resource organization’s business planning and resource  investments for the 2001-2005 time frame.
USCG attributes a number of its improved processes to the early  involvement of its human capital unit with the agency’s decision-making  management team.  Specific examples cited by USCG include (1) a  significant restructuring of military occupations and career paths to reflect  emerging requirements for new competencies, (2) a revision of assignment  and reassignment practices to make better use of the investments in  training and development, and (3) a restructuring of civilian personnel  management functions to better support line managers in meeting their  operational requirements.
USGS’s HR Office has also played a prominent role in agency strategic  planning and decision making.  In 1997, USGS’s HR Office led a group of  senior USGS managers in developing the first strategic HR plan for USGS  as the agency strategically planned how it would remain at the forefront of  earth and biological science and technology.  USGS’s strategic HR plan  formed the basis for the four people goals (skills, rewards, flexibility, and  leadership) included in the agency’s current strategic plan.  HR staff  members were active in the development of the people goals and in the  creation of the current and next-generation measures by which the agency  is assessing progress under these goals.  They were also involved in  planning and implementing the strategic human capital initiatives by which  USGS hopes to achieve its goals.
USGS’s strategic human resources plan describes how USGS will align its  people and processes with the business strategies it has adopted to achieve  its mission and also recognizes that organizational goals are seldom, if ever,  realized without the effective use and support of people.  One USGS  business strategy is to increase the agency’s flexibility to get work done by  using all options other than permanent staff members.  The strategic  human resources plan states that to enhance USGS’s flexibility to acquire  skills to meet short-term needs and provide an influx of new ideas, the HR  Office will, for example, expand the use of short-term student and faculty  appointments from academia and development agreements from the  private sector.
SSA’s Deputy Commissioner for Human Resources reports directly to the  Commissioner and is an equal partner with the agency’s other deputies.   SSA’s human capital officials report that their engagement in the strategic  planning activities of the agency has provided a much greater opportunity  to contribute to effective outcomes.    For example, the human capital  organization worked in partnership with SSA’s Office of Finance,  Assessment and Management regarding the competitive sourcing initiative  of the President’s Management Agenda to ensure there was no undue  negative impact on the agency’s human capital and workloads.  In addition,  SSA’s human capital organization has worked closely with SSA’s Office of  Systems in the construction and implementation of the Office of Systems’  major reorganization.  The human capital organization believes its efforts  have ensured the appropriate mix of employees at the proper levels, and  will result in an efficient systems organization.
section_title: Agency Leaders Established Entities to Integrate Strategic Human Capital Approaches
paragraphs: Agency leaders established entities, such as human capital councils,  accountable for integrating human capital approaches with program  strategies to attain successful program results.  Composed of senior agency  officials, including both program leaders and human capital leaders, these  groups meet regularly to review the progress of the agency’s integration  efforts and to make certain that the human capital strategies are visible,  viable, and remain relevant.  Additionally, the groups help the agencies  monitor whether differences in human capital approaches throughout their  agencies are well considered, effectively contribute to outcomes, and are  equitable in their implementation.
IRS, for example, created an entity to ensure a coordinated approach to  agencywide human capital issues, policies, and strategies.  The agency’s  Human Resource Policy Council (HRPC), which meets monthly for  approximately half a day, addresses cross-unit human capital issues that  cannot be resolved at lower levels.  It is composed of the Chief Human  Resource Officer and representatives from each of IRS’s major  organizations.  HRPC is charged with (1) identifying and addressing  crosscutting human capital issues and emerging human capital priorities,  (2) ensuring that cross-divisional links are in place and operating  effectively, (3) making final decisions on all cross-unit human capital  issues, (4) providing strategic human capital advice and recommendations  to the Commissioner and his senior staff, and (5) addressing the issue of  uniformity versus flexibility across divisions for human capital policy.   HRPC decided, for example, to eliminate agencywide restrictions regarding  fast-track promotion of IRS managers.
GSA has a similar group, its Human Capital Council.  The council, created  in 2002, meets quarterly and, as shown in table 2, consists of human capital  leaders, senior executives and officials for the major service and staff  offices, and representatives of regional administrators and deputy regional  administrators.
The council ensures that, among other objectives, the agency's human  capital strategic plan is consistent with GSA's strategic plan.  As an  advocate for human capital initiatives, council members are to ensure that  activities in the agency reflect the human capital strategic plan.  Another  objective of the group is to assist CPO in setting human capital program  priorities by assuring that program goals are key determinants of the  human capital approach.   To support future program priorities, the  council, for example, determined what the GSA leadership competencies  would be and established the policy and requirements for the GSA-wide  Advanced Leadership Development Program.
section_title: Human Capital Leaders Have Taken Actions to Transform Human Capital Organizations
paragraphs: High-performing organizations treat strategic human capital management  as fundamental to effective overall management.  Human capital leaders in  such organizations develop human capital organizations that can fulfill  enlarged roles, such as business partner, human capital expert, leader, and  change agent, to meet current and future programmatic needs.  For  example, agency human capital leaders took actions to enlarge the vision  of their organizations from being providers of largely transaction-based  services to ones whose visions included integrating human capital  approaches in agency plans and strategies to successfully accomplish their  goals.  To align the human capital resources with the organizations’ new  visions, human capital leaders often found it necessary to restructure the  organizations.  Additionally, improving and expanding upon the efficiency  of human capital systems and technology offers the opportunity to  reallocate additional resources for strategic purposes.  Human capital  leaders also worked to ensure that the human capital professionals within  their agencies were prepared, expected, and empowered to provide a range  of consultative and technical services to their internal customers.
subsections: section_title: Establishing a Human Capital Strategic Vision
paragraphs: A human capital strategic vision is crucial in providing a common direction  across the organization.  Agency human capital leaders we interviewed  envisioned their human capital offices becoming more strategically  involved with the achievement of agency goals.  These leaders  communicated their visions to employees and took steps to institute the  organizational changes needed to achieve their visions.
IRS’s former Chief Human Resource Officer believes that IRS’s human  capital professionals must be champions of change and be totally  committed to thinking and acting strategically with respect to the agency’s  broader mission, its people, and the importance of linking the two together.   According to IRS, to make change on the scale needed to enact the vision  requires the involvement of management, employees, and the employee  unions in virtually every aspect of the transformation.  To obtain employee  buy-in, IRS’s human capital organization formed work groups to empower  its human capital employees to participate in the redesign effort.
IRS’s human capital leaders believe the principal contribution of its new  human capital organization vision and framework is that it provides a  direct focus on developing new and more flexible ways of managing the  workforce.  For example, IRS has introduced streamlined critical pay  authority, developed a category rating process, and instituted a managerial  pay banding system.  IRS’s officials stated that these actions were  undertaken to attract world-class senior leadership and technical talent,  simplify and accelerate external and internal hiring, and support  organizational delayering in addition to creating a culture of performance  and individual accountability.  In general, they said the innovations provide  top management with a strong and direct connection between human  capital strategies and systems and mission results.
GSA’s Chief People Officer has a vision for GSA’s CPO to become a partner  in GSA’s business success.  To do so, she said that CPO must (1) deliver  products and services that enable its customers to focus on their core  business and (2) develop its workforce to be a valued business partner.   GSA’s Chief People Officer said that before the human capital organization  can play a bigger role as a business partner it must ensure that its  transaction-based tasks are accurately and efficiently processed and that  day-to-day problems, concerns, and needs of individual employees that are  related to human resources are addressed.
To achieve her vision, the Chief People Officer wants to focus more time  and resources on CPO becoming a business partner by ensuring that its  transaction-based tasks and advisory activities are completed more  efficiently.  She has placed a high priority on automation and information  technology as means to reduce costs and make time available for the  business partner role.  She has established a Chief Information Officer  (CIO) position within GSA’s CPO to support GSA’s human capital functions  that are increasingly being driven by technology.
The Chief People Officer has shared her vision with agency leadership  during presentations before GSA’s administrators.  In addition, she has  expressed her vision to program leaders during Human Capital Council  meetings and has included information on her vision in electronic  newsletters sent to CPO staff members.  The Chief People Officer also  issues periodic written updates on human capital issues that contain  information on her vision and related goals.
section_title: Restructuring the Human Capital Organization
paragraphs: Restructuring the human capital organization is an important step that is  often necessary for the transformation of the human capital function.   Ideally, this restructuring should help align the organization with its revised  vision and should position the human capital function to move from a  reactive, process-oriented, and compliance focus to the platform needed to  become a proactive, results-oriented, consulting-oriented strategic partner.    When we reported on agencies’ initial efforts to restructure their personnel  operations in 1998, we noted that the four departments reviewed generally  approached the restructuring of their personnel offices with the intent of  achieving staff reductions.   Some human capital leaders are now focusing  less on finding additional internal efficiencies and more on replacing stove- piped structures that include separate units for functions such as staffing  and classification, with more flexible structures that support new human  capital roles.
The right organizational structure can help human capital organizations  strategically align with agency objectives and improve the delivery of  human capital products and services.  Although some federal agencies are  restructuring their human capital organizations along similar lines, the  right organizational structure depends on the unique characteristics of the  agency.  In a 1999 report, OPM maintained that because organizations are  starting from different positions, they would need to structure their human  capital functions based on mission, not on a “one size fits all” solution.  In  a similar vein, in July 2000 a coalition of individuals representing a wide  cross section of organizations with an interest in the federal human capital  community anticipated that a variety of human capital organizational  structures would form across the federal government.  The coalition  predicted that factors such as customer needs and agency budgets would  design and drive the structure of a particular agency’s human capital  organization.  The report noted, however, that the group did expect to see  movement away from traditional structures toward more flexible  arrangements.
In a 2001 National Academy of Public Administration (NAPA) report, one of  the key findings was that human capital organizations were restructuring,  and the report noted that the emerging organizational model appears to  consist of three elements:  a center of expertise, a shared service center,  and a strategic consultant component.  The center of expertise provides  expert technical advice and assistance to managers and employees while  the shared service center processes traditional personnel transactions.   The strategic consultant component serves as a strategic partner, change  agent, and consultant to agency managers.   The elements in the new  structure attempt to balance the need for consolidation while still allowing  human capital professionals to have a direct connection with their  customers.
FEMA’s Human Resources Division (HRD) has recently restructured in a  manner similar to this emerging organizational model.  As shown in figure  1, FEMA’s new HRD structure contains three branches:  an advisory  services branch, a reconfigured operations branch, and a human capital  investment branch.
The advisory services branch provides on-site management advisory  service and support to FEMA directorates, regional offices, divisions, and  branches. The operations branch handles all staffing and selection,  classification systems, employee self-service operations, and records  processing.  The human capital investment branch is designed to take the  lead in FEMA’s strategic human capital planning and policy oversight.
FEMA officials told us that the agency restructured its human capital  organization to meet the emerging requirements of its strategic planning  initiatives and to address its inability to respond effectively to growing  operational demands.  Since the restructuring, HRD has initiated over 30  projects targeting human capital improvements that are aligned to the  agency’s strategic plan and the President’s Management Agenda.   For  example, the improvement initiatives included determining uniform  compensation bands based on staff competencies and a series of initiatives  focused on improving human capital services throughout the agency.   Additionally, in connection with its migration to the Department of  Homeland Security on March 1, 2003, FEMA identified a set of 17  “matrix/virtual” teams of HRD and agency leaders to address key  transitional issues.
IRS also restructured its human capital management function with the  same three elements found in the emerging organizational model.  The IRS  structure includes (1) an embedded human resources organization in each  business/functional unit, (2) an agencywide shared services organization,  and (3) a national headquarters strategic human resources organization  called Strategic Human Resources.  Under this arrangement, each  operating division has its own human capital office “embedded” within its  division.  These embedded human capital offices report to the operating  division leader and are tasked with formulating, implementing, and  customizing human capital policies, procedures, and strategies to fit the  business unit’s unique needs.  IRS’s agencywide shared services performs  an operational mission involving the delivery of common products and  services to organizations, managers, and employees across the agency.   Strategic Human Resources develops strategic human capital management  policies, programs, and strategies in collaboration with a council that  includes human capital directors from the major business units.
section_title: Technology Used to Facilitate Change
paragraphs: Improved efficiencies and economies of transaction-based services provide  the opportunity for agencies to reallocate resources and enable their  human capital organizations to meet expanded roles as business partners  and change agents.  However, as we found in our 1998 report on agencies’  efforts to restructure personnel operations, agencies need to carefully plan  and manage the implementation of new technology to fully achieve the  desired benefits.
USGS has developed OARS, which allows its human capital staff to enter  job vacancies into a centralized database and develop rating and ranking  criteria by selecting and weighting questions from an extensive question  library organized by job series.  Applicants register and apply for vacancies  on-line.  The system immediately rates, ranks, and scores applicants based  on their answers to weighted questions, taking into account all of the  regulations that govern the federal hiring process.  The list of the best- qualified candidates is provided to the hiring manager within several days.   USGS’s officials said that OARS has given applicants a quick and easy way  to apply for jobs, increased the number of applicants per vacancy between  40 and 500 percent, dramatically reduced the time it takes to fill vacancies,  and allowed human capital professionals to refocus their efforts from  processing to consulting.  USGS hopes to be able to divert an increasing  number of its staff members to other strategic efforts as it continues to gain  experience and efficiencies using OARS.
As mentioned above, GSA has established a CIO for the personnel function  located within its Chief People Office.  The position was created several  years ago when GSA began developing an information technology  management system for federal personnel operations.  Because GSA’s  comprehensive human resources integrated system (CHRIS) required  major systems modification and was intended to serve other federal  agencies, a senior-level technology position was needed to facilitate the  effort.   According to CPO’s CIO, his role is to evaluate, develop, and install  systems that support GSA’s human capital technology needs.  He believes  that technology is vital to achieving GSA’s Chief People Officer’s goals.  He  explained that improved technology and automation efforts mean less staff  time is needed for traditional human capital functions, thus allowing the  CPO staff members to play bigger roles as business partners.  However,  because most of GSA’s system is fairly new or still under development,  CPO’s CIO has not reduced resources and identified staff savings.  In an  earlier report, we noted instances where agencies eliminated personnel  staff before new technology for automating personnel transactions was in  place.  This resulted in delays in implementing new personnel and payroll  systems.  According to CPO’s CIO, resources reallocation will be  accomplished as efficiencies are demonstrated. CHRIS is expected to  ultimately provide self-service to employees and managers, performance  management capability, integrated training solutions, and succession  planning.  As technology becomes more important to the entire human  capital process and productivity drives future GSA staffing, the Chief  People Officer believes that by having the CIO in-house, she has needed  input into the technology decision making and the capital allocation  process for the agency.
As the President’s human capital management advisor, OPM has recently  been given the responsibility of leading five e-Government initiatives that  are designed to use technology to improve the strategic management of the  federal workforce.  OPM is the managing partner for the Recruitment One- Stop, e-Clearance, Enterprise Human Resources Integration, e-Training,  and e-Payroll initiatives.  The e-Payroll initiative, for example, is designed  to simplify and integrate payroll systems across the federal government.   OPM and OMB announced on January 15, 2003, the selection of two payroll  partnerships to consolidate federal payroll systems and save the federal  government an estimated $1.2 billion over the next decade.  The Enterprise  Human Resources Integration and e-Clearance initiatives are focused on  electronically integrating personnel records across the government and  reducing the delays involved in security clearance processing.  The full  implementation of these two initiatives is scheduled for the end of fiscal  year 2006.   OPM envisions that the use of technology will help streamline  and improve procedures for moving federal employees through the  employment life cycle by removing redundancies, reducing response times,  eliminating paperwork, and improving coordination among federal  agencies.
section_title: Changing Roles and Competencies for Human Capital Professionals
paragraphs: The actions that human capital leaders, and federal agencies in general, are  taking to improve their integration of human capital approaches with their  missions are reflected, in part, by a definite shift in the roles of human  capital professionals throughout the federal government.   The occupation  is in transition from valuing narrowly focused specialists to requiring  generalists, who have all the skills necessary to play an active role in  helping to determine the overall strategic direction of the organization.  As  agencies further integrate strategic human capital approaches into their  strategic planning and decision making, investment in the development of  new competencies for human capital professionals is receiving more  attention.
OPM published a study in 1999 establishing a statistical profile of the  human capital profession within the federal government.   The report  described the federal human capital community as a cadre of experts  separated into seven distinct occupational series.  One series represented  the human capital generalist, who typically has a breadth of knowledge  about personnel issues.  The other six categories consisted of specialists,  such as classifiers and staffing specialists, who possess in-depth  knowledge in specific human capital areas.  The report noted that from  1969 through 1998 there had been a small but noticeable shift occurring in  the human capital profession away from specialist positions to generalist  positions.  In 1998, generalists made up a slight majority of human capital  professionals at 53 percent, while specialists positions had declined to 47  percent.
Consistent with the changing roles and expectations for human capital  professionals, this noticeable shift toward human capital generalists has  accelerated since 1998.  As of June 2002, generalists made up 73 percent of  human capital professionals, while specialists had declined to 27 percent.   Figure 2 shows the dramatic change in the percentage of human capital  generalists since 1996.
A combination of factors appears to have contributed to this shift.   According to OPM, it was necessitated, to a large degree, by the significant  downsizing in federal office staffing levels during the 1990s, which  precluded continuing a specialized approach.  In addition, OPM  concluded that human capital management as an occupation had been  undergoing a significant redefinition.  For example, automation began to  greatly affect how human capital products and services were delivered.   Many agencies began using the Internet or their own intranets to educate  managers and employees about human capital programs and options.  OPM  also noted in a 1999 report that many agencies were beginning to outsource  some of their human capital services.  With more efficient ways to deliver  products and services, human capital professionals could focus on their  emerging roles as advisors and consultants, which require more generalist  practitioners able to work across multiple human capital functions.
The advantage to the agencies of this shift was that existing staff members  could be deployed more flexibly and new staff members could be recruited  for broader human capital competencies that had less to do with  specialized procedures than with general human capital knowledge,  concepts, and principles.  In fact, OPM concluded in 2000, based on a body  of research and evidence, that the human capital occupation was truly  becoming generalized in nature both inside and outside the federal  government.  Although OPM did not find that human capital roles had  shifted in every agency, it determined that agencies needed their human  capital staff members to leave behind their roles of technical specialists  focused on regulatory compliance and to take on more consultative roles.   This entailed working with managers, employees, and their representatives  to ensure that human capital programs and practices were properly aligned  to help the organization meet its strategic objectives, while adhering to  merit system principles and other legal obligations.
To reflect these changes in the federal human capital community, in  December 2000, OPM issued a new consolidated classification standard for  the Administrative Work in the Human Resources Management Group.    OPM expects the agencies to apply the new job family position  classification standard within a reasonable amount of time of its release, as  determined by the agency.  According to an OPM official, agencies are  making progress in applying the new standard.
The pressures on human capital professionals to assume new roles present  a significant learning and development challenge for human capital staff  members.  For human capital professionals to begin acting in their new  capacities, human capital leaders must ensure that they develop the  competencies and gain the experience to effectively take on the expected  roles.  Consistent with the changes reflected by OPM’s new classification  standards, several of the agencies we reviewed have developed human  capital competency models designed to develop staff members who can  contribute at the strategic and business partner levels as well as design and  manage delivery systems, which achieve value-added services at lower  costs.
GSA recognized the vision of its Chief People Officer and the changing role  of its human resources organization and assembled a team of experienced  human resources staff members to develop new core competences needed  by the CPO staff.  This group developed GSA’s new human capital core  competencies needed to support its CPO business model and identified five  roles that GSA believes its human capital community must play  successfully to achieve the Chief People Officer’s vision and to meet the  expectations of the GSA customers.  The five roles are consultant, leader,  technologist, transactional expert, and expert.  Specific competencies  support each role.  In addition, GSA uses its competency model as a  recruiting tool for human resources professionals.  The model lists  desirable attributes for job candidates as well as a few suggested interview  questions for determining whether applicants possess these attributes.   Table 3 lists GSA’s HR roles and the primary competencies GSA states are  essential for success in each of the roles.
USGS’s HR Competency Model also identifies and describes a set of human  capital competencies that are essential to effective performance in the  roles and responsibilities of the agency’s human capital office as outlined in  its business model.   USGS’s competency model identifies core or universal  competencies that USGS human capital staff members need and specific  competencies that human capital managers, strategic consultants,  operating specialists and generalists, and assistants need.  For each  competency, the model describes how that competency is applied.   According to USGS, the competency model is currently being used as a tool  for self-directed human capital development, and portions of the model  have been incorporated in the new automated skills assessment system.  In  the future, USGS plans to use the model as a basis for recruiting and  interviewing candidates, making decisions about developmental  assignments, and developing the competencies of every human capital staff  member to think and relate strategically to the science mission of USGS.   Table 4 lists USGS’s competency categories.
section_title: Joint Actions Result in Shared Accountability
paragraphs: As the role of the human capital organization evolves to include serving the  individual employee and helping to achieve the organization’s strategic  objectives, the accountability for human capital management is  increasingly being shared by top management, line managers, and human  capital professionals.  Successful organizations, according to our Model of  Strategic Human Capital Management, include human capital  professionals acting together with agency leaders and line managers in  developing strategic and program plans to accomplish agency goals.   Through this joint action, agency and human capital leaders and their staffs  share accountability for successfully integrating strategic human capital  approaches into the planning and decision making of the agency.
subsections: section_title: Assuming Shared Accountability for Achieving Program Goals
paragraphs: Agency and human capital leaders, human capital professionals, and line  managers share responsibility for achieving agency programmatic and  human capital goals, and they ultimately share accountability for effective,  legally compliant human capital management.  According to OPM, agencies  have delegated more key human capital authorities to line managers.  In a  recent report, we highlighted the importance of delegating authority and  holding line managers accountable for the effective use of human capital  flexibilities, important tools that assist agencies in managing their  workforces.  Agencies are also following a more collaborative approach  between managers and human capital professionals for those human  capital authorities retained by the human capital staff members.   Additionally, more agency and human capital leaders are linking human  capital policies and practices to organizational outcomes and expecting  more collaboration between line managers and human capital  professionals.
IRS, for example, has dispersed human capital professionals throughout  the agency’s divisions to help apply strategic thinking to each operating  division’s unique interest.   Human capital staff members are responsible  for advising operating division managers on how to best apply human  capital strategy to improve results.  The human capital professional may  have responsibility, for example, for assisting managers in anticipating  changes in the labor market and recommending strategies for sustaining a  well-qualified and productive workforce.  The operating division managers  are responsible for rating the performance of the human capital  professionals working with them.  According to IRS officials, some of the  benefits of the shared accountability of human capital professionals  working with operating division managers have included customized  support for recruitment plans and hiring products and a facilitated merit  promotion process.
FEMA line managers and human capital staff members have developed a  system where the human capital staff works with line managers to quickly  identify available employees for deployment as soon as disasters are  declared.  FEMA employs approximately 2,600 full-time employees and as  many as 4,000 temporary and reserve employees who are deployed during  federal disasters.  In response to this need, the human capital office has  implemented the Automated Disaster Deployment System.  This automated  system allows the staff to track employee credentialing (including  knowledge and experience levels and performance ratings), availability,  past and present assignment locations, dates of employment, and other  vital employee data.  According to FEMA officials, the system enables  human capital staff and line managers to share accountability for  identifying employee training and promotion needs, matching employee  expertise with specific disaster site victim needs, and creating a selection  routine that rotates available employees, thereby avoiding employee  burnout.  The process has reduced the time necessary to complete the  staffing review and selection from days to hours.  Additionally, centralized  deployment provides a dedicated staff that acts upon all deployment  requests within 3 hours.
section_title: Increasing Role for Line Managers in Human Capital Management
paragraphs: Line managers have always played a key role in human capital  management.  They interact with, teach, evaluate, reward, develop, and  promote employees from the day they join an organization.  According to  OPM, many agencies are now pursuing the strategy of delegating key  human capital authorities to managers thereby making the delegated  authorities within the agency shared responsibilities of the manager and  the human capital staff.  SSA officials, for example, described how  responsibility for recruiting new employees is now shared between human  capital professionals and line managers.  SSA involves agency line  managers in the preliminary recruiting determinations and has human  capital professionals take over in the final, technical stages.
Some agencies have developed tools and services to help line managers  assume more human capital authority.  Within our selected agencies, SSA,  for example, has a link on its Office of Personnel Web site that contains,  “Information for Managers.”  The Web site presents a myriad of  information, from addressing poor performance to life resources  counseling.  GSA’s CPO has issued a supervisory desk guide to provide  supervisors with basic information on human capital topics.  The desk  reference guide provides an overview of personnel and administrative  practices and procedures that supervisors should know.  According to the  guide, it is not meant to make supervisors into personnel experts or  provide the answers to all personnel-related or administrative questions.   The guide is meant to give supervisors basic information on topics such as  internal and external recruitment, pay flexibilities, and worker’s  compensation that will enable them to handle most situations and to  provide references and contacts for more information.
section_title: Conclusions
paragraphs: As agencies integrate their human capital strategies with their  organizational missions, visions, core values, goals, and objectives, they are  increasingly recognizing how human capital activities contribute to  achieving missions and goals.  Congress has recognized this through recent  legislation creating a chief human capital officer position in major  agencies.  Effective human capital integration efforts require the  cooperation of management and employees throughout the organization.   All members of an organization must understand the rationale for making  organizational and cultural changes because everyone has a stake in  helping to implement the initiatives as part of the agency’s efforts to meet  current and future challenges.
In this report, we have identified actions agencies have taken to improve  their integration of strategic human capital approaches with their strategies  for accomplishing organizational missions and goals.  Agency leaders  included human capital leaders in key agency strategic planning and  decision making.  Human capital leaders transformed the agencies’ human  capital organizations to better enable them to add value to the strategic  activities of the agencies.  Working together, agency leaders and human  capital leaders have employed human capital professionals and agency line  managers to share accountability for successfully integrating strategic  human capital considerations into agency planning and decision making.
As agencies take action to enhance their ability to meet organizational  goals by linking their human capital activities with their strategic planning  and decision making, agencies can consider the initiatives we identified.    However, each federal agency will have to consider the applicability of  specific actions to be taken within the context of its own mission, needs,  and culture.
section_title: Agency Comments
paragraphs: We provided a draft of this report to the Director of OPM and to cognizant  officials from the individual agencies we visited.  OPM and five of the six  agencies provided comments on the draft report.  All generally agreed with  the information presented.
Two of the agencies and OPM provided written technical comments to  clarify specific points regarding the information presented.  Where  appropriate, we have made changes to reflect those technical comments.   In other cases, agencies provided additional examples of actions they had  taken to integrate human capital approaches to attain mission results.   OPM noted that the results of the agency initiatives have not been  evaluated, which is an important next step for agencies to take, but was not  within the scope of this report.  USCG noted that they had no comments on  the report.
We will send copies of this report to appropriate congressional committees,  the federal agencies and offices discussed in this report, and the Directors  of OPM and OMB.  We will also make copies available to others upon  request.  In addition, the report will be available at no charge on the GAO  Web site at http://www.gao.gov.
If you have any questions about this report, please contact me or William  Doherty on (202) 512-6806 or on mihmj@gao.gov and dohertyw@gao.gov.   The major contributors to this report were Clifton G. Douglas, Jr. and  Judith Kordahl.  Mark Braza, Matthew Tropiano, and Laura Turman also  made key contributions.
section_title: Objective, Scope, and Methodology
paragraphs: Our objective in this self-initiated review was to identify examples of key  actions that agencies have taken to integrate their human capital  approaches with agency strategies for achieving mission objectives.
To address our objective, we identified and focused on six federal agencies  that were integrating their human capital approaches.  We analyzed agency  documents, such as planning and organizational restructuring documents,  and previous studies on strategic human capital management.  In addition,  we conducted semistructured interviews with agency officials, human  resources directors, and line managers from our selected agencies that  were involved in designing or implementing their agencies’ human capital  integration actions.  We elicited their experiences and conclusions about  the agency actions they believed were most important to the successful  integration of their human capital functions.  After reviewing and analyzing  their responses, we developed a framework to classify and report on the  types of actions identified.  We did not attempt to independently verify the  performance results that agencies attributed to their actions.
To select the agencies we reviewed, we first held discussions with human  capital experts from American University, the Center for Policy  Implementation, George Washington University, and the National Academy  of Public Administration.  We asked these experts to identify federal  agencies that they believed had taken actions to improve the integration of  their strategic human capital management functions.  We also reviewed our  High-Risk Series, the Federal Managers’ Survey, and other documents for  examples of federal agency integration efforts not identified by the human  capital experts.  In addition, we considered the size, mission, and type of  workforce of the pool of identified agencies to get a variation of federal  agency experiences.  We selected six agencies—the Federal Emergency  Management Agency, the General Services Administration, the Internal  Revenue Service, the Social Security Administration, the U.S. Coast Guard,  and the U.S. Geological Survey—to identify examples of human capital  integration actions.  Our selection process was not designed to provide  examples that could be considered representative of all the actions at the  agencies reviewed or of the federal government in general.  By profiling an  agency for a particular action, we do not mean to imply complete success  for the action or lack of success for others.
We conducted our work from February 2002 through January 2003 in  accordance with generally accepted government auditing standards.
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section_title: Public Affairs