The Bureau’s experience with the 2010 and prior enumerations has shown that lack of proper planning and not following leading practices in key management areas can increase the costs and risks of later downstream operations. Leading up to the 2010 Census, we reported on internal organizational, planning, funding, and human capital challenges that jeopardized the Bureau’s overall readiness. For example, we reported that additional costs and risks associated with the data capture technologies used in the 2010 Census were related to a failure to adequately link specifications for key information technology (IT) systems to requirements. And the lack of skilled cost estimators for the 2010 Census led to unreliable life-cycle cost estimates. Some of the operational problems that occurred during the 2010 and prior censuses are symptomatic of deeper organizational issues. For example, a Bureau self-assessment carried out in October 2008 found that its organizational structure made overseeing a large program difficult and hampered accountability, succession planning, and staff development. We and other organizations, including the Bureau itself, have stated that fundamental changes to the design, implementation, and management of the census must be made in order to address these and other problems. In addition, the Bureau Director has testified that various parts of the Bureau could collaborate more effectively. In response, the Bureau has started numerous change initiatives, some directed at transforming the Bureau’s organization itself in addition to reexamining its fundamental approach to how it will conduct the 2020 Census. GAO, 2010 Census: Preliminary Lessons Learned Highlight the Need for Fundamental Reforms, GAO-11-496T (Washington, D.C.: Apr. 6, 2011). The Bureau’s organizational transformation took a significant step forward in July 2011 when it created a 2020 Census Directorate, with decennial planning being led by its 2020 Research and Planning Office. The Bureau is targeting to complete further reorganization of its decennial units by the end of fiscal year 2013. In order to obtain necessary approval from the Department of Commerce, the Bureau has set a target of February 2013 for submitting a proposal to the department. To support the organizational transformation effort, the Bureau has designated an “organizational change manager,” responsible for planning and managing the day-to-day organizational change activities. Relatedly, the Bureau is attempting to develop Bureau-wide, or “enterprise,” standards, guidance, or tools, in areas such as risk management, project management, systems engineering, and IT investment management in order to reduce duplicative efforts across the Bureau. The Bureau is also reexamining how it fundamentally conducts the decennial census, committing to identify and implement innovation and improvements as necessary to conduct the 2020 Census at a lower cost per housing unit than the approximately $100 per housing unit cost of the 2010 Census (in constant 2010 dollars) while still maintaining high quality. To do so, the Bureau has divided the 14-year life cycle of the 2020 Census into five phases, beginning in fiscal year 2009 with Options Analysis. The figure below illustrates the sequencing of the five 2020 Census phases. The current, second, phase, Early Research and Testing, comprises 35 research projects that are intended to explore how design areas could be modified to control costs or improve quality, such as by using the Internet, social media, and administrative records. As the Bureau reexamines how it will plan the 2020 Census, it is also reviewing the employee skills and competencies needed to make that happen, in part by a formal analysis comparing its needs to its in-house capabilities being carried out by its Human Resources Division in collaboration with the 2020 Census Directorate. One of the Bureau’s objectives listed within its early planning documents is to have a highly competent workforce that is matched with the demands of the 2020 Census. The Bureau’s 2008 internal assessment found that some activities involving the management of large programs and projects, cost estimation, and IT lacked staff with core skills and experience. The Bureau has said that it needs to develop a clear understanding of how existing skill sets align with emerging needs, determine the best use of resources to close competency gaps, and provide information to employees and managers to guide continuing workforce development. The Bureau is undertaking an organizational transformation of its entire decennial directorate in order to improve collaboration and communication across its divisions, improve operational efficiencies, and instill a culture that, according to the Bureau, encourages risk-taking and innovation without fear of reprisal. The Bureau believes such change is necessary so that it can more-effectively control costs and enumerate the population for 2020. In 2010, the Bureau generally completed its peak census data-collection activities consistent with its operational plans and released the state population counts used to apportion Congress on December 21, 2010, several days ahead of the legally mandated end-of- year deadline, but did so at a cost that was higher than originally estimated. The Bureau is incorporating several leading organizational transformation practices, which we have previously reported can help individuals affected by the organizational change adapt to the new organization, while simultaneously managing the risk of reduced productivity and effectiveness that often occurs as a result of change. Our prior work has identified key practices in effective organizational transformation, six of which are ensure top leadership drives the transformation, focus on a key set of principles and priorities at the outset of the transformation, set implementation goals and a timeline to build momentum and show progress, dedicate an implementation team to manage the transformation process, involve employees to obtain their ideas and gain ownership for the transformation, and establish a communication strategy to create shared expectations and report related progress. The Bureau is at an early stage of planning for its transformation, and has a difficult road ahead to finish the planning and begin implementing it. As shown in figure 2, the Bureau has taken numerous steps consistent with the key practices. For example, the Bureau Director has led the drive for the reorganization, speaking in public and to Bureau staff a number of times about the need for the Bureau to change if it is to remain cost- effective and relevant in the 21st century. Following the announcement of the Director’s upcoming August 2012 departure, several Bureau executives said that they remained committed to the initiatives and vision shared by the Director, including the organizational transformation. In addition, the Bureau has focused on a key set of principles and priorities at the outset of the transformation, by including in its change-strategy documents not only explicit reliance on the guiding principles for the 2020 Census, but specific principles to guide the transformation itself, such as “make data-driven decisions,” “be responsive and transparent to decennial staff and stakeholders,” and “focus on an efficient and resilient organization.” The Bureau has also created a high-level transformation timeline to build momentum and show progress that includes milestones such as staff workshops and deliverables such as multiyear roadmaps. Figure 2 also shows that the Bureau plans to take further steps over the next year. For example, the Bureau is planning to roll out much of its transformation planning to its staff in June 2012. In July, the Bureau plans to more directly engage decennial staff by beginning a series of data- collection activities, intended for staff to identify which decennial planning processes work well and which need improving, and is considering reliance on focus groups, online staff surveys, or workshops. Eventually, and subject to sustained progress of the transformation process, the Bureau plans by February 2013 to propose specific changes to its decennial organization and finalize a timeline for carrying out the transition to a new organization, subject to approval of the changes by the department and the Office of Management and Budget. Although the Bureau is taking and planning many positive steps toward carrying out its organizational transformation, it may be falling short in its use of an implementation team. Specifically, the amount of change- related activity being planned may not be aligned with the resources the Bureau has allocated to plan, coordinate, and carry them out. While Bureau organizational transformation documents were largely in draft and subject to change at the time we completed our review, the multiple workshops being planned, the preparation of multiple plan and strategy documents referenced as deliverables, as well as the collation and analysis of data to be collected from staff, seem to be substantial work for the sole staff member dedicated at this time to the transformation. That person, the current organizational change manager, has time divided among transformation planning and implementation, support of the executive council advising on the transformation, leading a working group on decennial strategic workforce planning, and leading a working group on 2020 Census organizational change management communication as well. We have previously observed that a strong and stable implementation team responsible for the transformation’s day-to-day management is important to ensuring that transformation receives the focused attention needed to be sustained and successful. If activity planned for the transformation is not aligned with the resources dedicated to it, various change initiatives may not be sequenced or implemented in a coherent and integrated way, collected data may not be properly analyzed and used, and risks to implementation may not be identified or properly mitigated. In written comments on our draft report, the Department of Commerce responded that after receiving the draft the Bureau assigned additional staff and a contractor to support the Bureau’s organizational transformation activity. This action appears responsive to our finding, and, as follow-up to this report, we will assess any action the Bureau may take to examine the alignment between the levels of activity planned for the transformation and the resources dedicated to their implementation. The Bureau is incorporating several long-term project-planning practices that—if continued and built upon throughout the decade—should help the Bureau avoid many of the management problems it has experienced in prior censuses. For example, the Bureau experienced cost overruns for the 2010 Census in large part because it had to abandon expensive plans for increased use of automation in its field operations late in the planning cycle. Furthermore, preparing a rigorous long-term project plan will help the Bureau demonstrate to Congress and other stakeholders that it can effectively design and manage operations as well as control costs. Our prior work has identified key practices for effective long-term project planning, five of which are develop a project plan, involve stakeholders, incorporate lessons learned, analyze and mitigate risks, and monitor progress.