We agree the  intelligence community needs to move from a culture of “need to know” to  “need to share.” The 9/11 Commission has made observations regarding  information sharing, and recommended procedures to provide incentives  for sharing and creating a “trusted information network.” Many  Commission recommendations address the need to improve information  and intelligence collection, sharing, and analysis within the intelligence  community itself. However, reconciling the need to share with actually sharing has been at  the heart of the 9/11 Commission’s recommendations and our own  findings and observations on practices to improve information sharing. At that time, we recommended that  the Secretary of Homeland Security work with the heads of other federal  agencies and state and local authorities to:  incorporate the existing information-sharing guidance that is contained  in the various national strategies and information-sharing procedures  required by the Homeland Security Act,    establish a clearinghouse to coordinate the various information-sharing  initiatives to eliminate possible confusion and duplication of effort,  fully integrate states and cities into the national policy-making process  for information sharing and take steps to provide greater assurance  that actions at all levels of government are mutually reinforcing,  identify and address the perceived barriers to federal information  sharing, and    use a survey method or a related data collection approach to  determine, over time, the needs of private and public organizations for  information related to homeland security and to measure progress in  improving information sharing at all levels of government. DHS concurred with the above recommendations. Some of the saddest  aspects of the 9/11 story are the outstanding efforts of so many individual officials  straining, often without success, against the boundaries of the possible. While Changes May be Needed, Caution and Care Must be Taken

As the committee is aware, GAO has done extensive work on federal  organizational structure and how reorganization can improve  performance. The 9/11 Commission has recommended major changes to  unify strategic intelligence and operational planning with a National  Counterterrorism Center and provide the intelligence community with a  new National Intelligence Director. In response to the emerging trends and long-term fiscal challenges the  government faces in the coming years, we have an opportunity to create  highly effective, performance-based organizations that can strengthen the  nation’s ability to meet the challenges of the twenty first century and reach  beyond our current level of achievement. Many  are still focused on their original mission that may not be relevant or as  high a priority in today’s world. These are the  charges highlighted by the 9/11 Commission’s findings and  recommendations. As I have  testified before this committee, the granting of executive reorganization  authority to the President can serve to better enable the President to  propose government designs that would be more efficient and effective in  meeting existing and emerging challenges involving the intelligence  community and information sharing with other entities. Similarly, the 9/11  Commission recommends realigning congressional oversight to support its  proposals to reorganize intelligence programs. We believe, Mr. Chairman, that at the center of any serious change  management initiative are the people involved—people define the  organization’s culture, drive its performance, and embody its knowledge  base. As such, strategic human capital (or  people) strategy is the critical element to maximizing government’s  performance and ensuring accountability of our intelligence community  and homeland security efforts. Thus, organizational transformations  that incorporate strategic human capital management approaches will  help to sustain agency efforts and improve the efficiency, effectiveness,  and accountability of the federal government. To help, we have identified a  set of practices that have been found to be central to any successful  transformation effort. Importantly, this is not to delay needed reforms for  any agency, but to accelerate reform across the federal government and  incorporate appropriate principles and safeguards. The federal government is well short of where it needs to be in setting  national homeland security goals, including those for intelligence and  other mission areas, to focus on results—outcomes—not inputs and  outputs which were so long a feature of much of the federal government’s  strategic planning. However, because of historical  resistance from the intelligence agencies and the general lack of support  from the intelligence committees in the Congress, GAO has done limited  work in this community over the past 25 years. The Challenges Faced in Intelligence Reform

In conclusion, on the basis of GAO’s work in both the public and the  private sector over many years, and my own change management  experience, it is clear to me that many of the challenges that the  intelligence community faces are similar or identical to the transformation  challenges applicable to many other federal agencies, including GAO. In addition, this person should be  appointed by the President and confirmed by the Senate in order to help  facilitate success and ensure effective oversight. With regard to the oversight structure of the Congress, the 9/11  Commission noted that there are numerous players involved in  intelligence activities and yet not enough effective oversight is being done. In the intelligence  arena, we know the potential end result is failure for the nation. As the 9/11 Commission and others have  noted, such a restructuring is needed in both the executive branch and the  Congress. We can and we must enhance and integrate our intelligence efforts as  suggested by the 9/11 Commission to significantly improve information  sharing and analysis. Several models to achieve this result exist, and  despite the unique missions of the intelligence community can readily be  adapted to guide this transformation.
Why GAO Did This Study

The sorrow, loss, anger, and resolve so evident immediately following the September 11, 2001, attacks have been combined in an effort to help assure that our country will never again be caught unprepared. As the 9/11 Commission notes, we are safer today but we are not safe, and much work remains. Although in today's world we can never be 100 percent secure, and we can never do everything everywhere, we concur with the Commission's conclusion that the American people should expect their government to do its very best. GAO's mission is to help the Congress improve the performance and ensure the accountability of the federal government for the benefit of the American people. GAO has been actively involved in improving government's performance in the critically important homeland security area both before and after the September 11 attacks. In its request, the House Committee on Government Reform have asked GAO to address two issues: the lack of effective information sharing and analysis and the need for executive branch reorganization in response to the 9/11 Commission recommendations. Further, the Committee has asked GAO to address how to remedy problems in information sharing and analysis by transforming the intelligence community from a system of "need to know" to one of a "need to share."

What GAO Found

The 9/11 Commission has recommended several transformational changes, such as the establishment of a National Counterterrorism Center (NCTC) for joint operational planning and joint intelligence and replacing the current Director of Central Intelligence with a National Intelligence Director (NID) to oversee national intelligence centers across the federal government. The NID would manage the national intelligence program and oversee agencies that contribute to it. On August 2, 2004, the President asked Congress to create a NID position to be the principal intelligence advisor, appointed by the President, with the advice and consent of the Senate and serving at the pleasure of the President. Unlike the 9/11 Commission, the President did not propose that the NID be within the Executive Office of the President. He also announced that he will establish a NCTC whose Director would report to the NID, and that this center would build upon the analytic work of the existing Terrorist Threat Integration Center. He suggested that a separate center may be necessary for issues of weapons of mass destruction. Finally, he endorsed the 9/11 Commission's call for reorganization of the Congressional oversight structure. There are, however, several substantive differences between the President's proposal and the Commission's recommendations. While praising the work of the 9/11 Commission, and endorsing several of its major recommendations in concept, the President differed with the Commission on certain issues. These differences reflect that reasoned and reasonable individuals may differ, and that several methods may exist to effectuate the transformational changes recommended. However, certain common principles and factors outlined in this statement today should help guide the debate ahead. Although the creation of a NID and a NCTC would be major changes for the intelligence community, other structural and management changes have occurred and are continuing to occur in government that provide lessons for the intelligence community transformation. While the intelligence community has historically been addressed separately from the remainder of the federal government, and while it undoubtedly performs some unique missions that present unique issues, its major transformational challenges in large measure are the same as those that face most government agencies. As a result, GAO's findings, recommendations, and experience in reshaping the federal government to meet Twenty-First Century challenges will be directly relevant to the intelligence community and the recommendations proposed by the 9/11 Commission. The goal of improving information sharing and analysis with a focus upon the needs of the consumers of such improved information for specific types of threats can provide one of the powerful guiding principles necessary for successful transformation. This testimony covers four major points. First, it describes the rationale for improving effective information sharing and analysis, and suggest some ways to achieve positive results. Second, it provides some overview perspectives on reorganizational approaches to improve performance and note necessary cautions. Third, it illustrates that strategic human capital management must be the centerpiece of any serious change management initiative or any effort to transform the cultures of government agencies, including that of the intelligence community. Finally, it emphasizes the importance of results-oriented strategic planning and implementation for the intelligence arena, focusing management attention on outcomes, not outputs, and the need for effective accountability and oversight to maintain focus upon improving performance. It concludes by applying these concepts and principles to the challenges of reform in the intelligence community.