Process Used to Design the Human Capital System

The design process of the DHS human capital management system  included DHS and OPM employees and union representatives. Below the headquarters level, strategic human capital planning of different  levels of detail is being done in the five legacy components we studied. DHS headquarters has not yet been systematic or consistent in gathering  relevant data on the successes or shortcomings of legacy component  human capital approaches or current and future workforce challenges,  despite the potential usefulness of this information to strategic human  capital planning activities. Efforts are now under way to gather such data. Moving forward, the department plans to  design a centralized information system so that human capital data can be  gathered and reported at the corporate level. With this information, the department will be better positioned to conduct  data-driven evaluations of the successes and shortcomings of its new  human capital management system. Continued Leadership Is Necessary to Marshal the Capabilities Required for Successful Implementation

DHS and OPM leaders have consistently underscored their personal  commitment to the design process and speak openly in support of it. Resources. In our September 2003 report, we commended the  structured approach the department developed to communicate with  stakeholders on the human capital system and recommended that the  Secretary of DHS ensure that the message communicated across the  department was consistent. Since the release of the proposed regulations, DHS has provided  information to employees through a variety of formats. DHS formed three implementation teams at the  end of February 2004 to support the design and implementation of the  human capital management system because of the multiple areas that  require management attention. DHS Proposes Implementing Key Safeguards

In its proposed regulations, DHS outlines its intention to implement key  safeguards that we have found essential to implementing performance  management systems in a fair, effective, and credible manner. For  example, the DHS performance management system must comply with the  merit system principles and avoid prohibited personnel practices; provide a  means for employee involvement in the design and implementation of the  system; and overall, be fair, credible, and transparent. The department also  plans to align individual performance management with organizational  goals and provide for reasonableness reviews of performance management  decisions through its Performance Review Boards. Conclusions

The proposed DHS human capital management system has both significant  precedent-setting implications for the executive branch and far-reaching  implications on how the department is managed. To date, DHS’s actions in  designing its human capital management system and its stated plans for  future work on the system are positioning the department for successful  implementation. Communication and training -- As we previously noted, communicating  with employees and their representatives about the new system and  providing opportunities for feedback, placing a special emphasis on  reaching out to line employees in the field, can facilitate gaining  employee buy-in to the new human capital management system. Agency Comments and Our Evaluation

In commenting on a draft of this report, DHS generally agreed with its  findings. FHCS data are  the most current information available on the perceptions of employees  currently employed by DHS and are valuable because of their illustration of  the challenges the department faces.
Why GAO Did This Study

DHS was provided with significant flexibility to design a modern human capital management system. Its proposed system has both precedent-setting implications for the executive branch and farreaching implications on how the department is managed. GAO reported in September 2003 that the effort to design the system was collaborative and consistent with positive elements of transformation. In February, March, and April 2004 we provided preliminary observations on the proposed human capital regulations. Congressional requesters asked GAO to describe the infrastructure necessary for strategic human capital management and to assess the degree to which DHS has that infrastructure in place, which includes an analysis of the progress DHS has made in implementing the recommendations from our September 2003 report. DHS generally agreed with the findings of our report and provided more current information that we incorporated. However, DHS was concerned about our use of results from a governmentwide survey gathered prior to the formation of the department. We use this data because it is the most current information available on the perceptions of employees currently in DHS and helps to illustrate the challenges facing DHS.

What GAO Found

To date, DHS's actions in designing its human capital management system and its stated plans for future work on the system are helping to position the department for successful implementation. Nonetheless, the department is in the early stages of developing the infrastructure needed for implementing its new human capital management system. DHS has begun strategic human capital planning efforts at the headquarters level since the release of the department's overall strategic plan and the publication of proposed regulations for its new human capital management system. Strategic human capital planning efforts can enable DHS to remain aware of and be prepared for current and future needs as an organization. However, this will be more difficult because DHS has not yet been systematic or consistent in gathering relevant data on the successes or shortcomings of legacy component human capital approaches or current and future workforce challenges. Efforts are now under way to collect detailed human capital information and design a centralized information system so that such data can be gathered and reported at the departmentwide level. DHS and Office of Personnel Management leaders have consistently underscored their personal commitment to the design process. Continued leadership is necessary to marshal the capabilities required for the successful implementation of the department's new human capital management system. Sustained and committed leadership is required on multiple levels: securing appropriate resources for the design, implementation, and evaluation of the human capital management system; communicating with employees and their representatives about the new system and providing opportunities for feedback; training employees on the details of the new system; and continuing opportunities for employees and their representatives to participate in the design and implementation of the system. In its proposed regulations, DHS outlines its intention to implement key safeguards. For example, the DHS performance management system must comply with the merit system principles and avoid prohibited personnel practices; provide a means for employee involvement in the design and implementation of the system; and overall, be fair, credible, and transparent. The department also plans to align individual performance management with organizational goals and provide for reasonableness reviews of performance management decisions through its Performance Review Boards.