Panelists Identified Cultural and Technical Factors That Have Affected ATC Modernization and Suggested Short-term Steps to Address Them

The panelists attributed many of the ATC modernization program’s chronic  problems to cultural and technical factors. In particular, they cited  resistance to change at all levels within the agency and insufficient  technical expertise as key factors impeding modernization. They identified  multiple, currently available options for addressing these factors. Panelists Suggested Steps That the ATO Could Take in the Short Term to Address Cultural Impediments to Modernization

what is expected of them, how they fit into the strategy, and what the  vision is for their organization. Panelists Said FAA Personnel Lack Technical Expertise Needed to Develop Complex Systems and Oversee Contractors Effectively

Technical as well as cultural factors have impeded ATC modernization,  according to several of the panelists. They think that meetings are products.” good job, but who certainly have a different motivation from FAA. This panelist described how a foreign air traffic  services organization develops new ATC systems in-house and seldom  uses contractors. He also  noted that FAA plans to train or hire people with needed skills to address  shortfalls in technical expertise. For example, the ATO  established collaborative teams of technical experts and ATC system   reorganized air traffic services and the research and acquisition  organization along functional lines of business to bring stakeholders  together and integrate goals, as well as reward cooperation by linking  investments to operations;    reduced layers of management from 11 to 7 to help address the  hierarchical nature of the organization; and  conducted an organizationwide activity value analysis to determine  the full range of activities that ATO headquarters is engaged in, the  value customers place on those activities, and the potential for  conducting any of those activities more effectively and efficiently. In their view, the  most immediate issue is a critical shortage of funds to meet the current  modernization program’s plans and users’ demands. Additionally, they said,  the federal budget process is slow, inflexible, and influenced by the  political process; annual appropriations are uncertain and discourage  planning; and the budget fails to show investment priorities and  relationships between FAA’s capital and operating budgets. Funding Air Traffic Services through the Budget Process Is Slow and Inflexible, Some Panelists Said

Several panelists maintained that the federal budget cycle is too long and  inflexible to meet the needs of an ATC system. Such a “dramatic,” “dynamic” system requires “more managerial  freedom, much more day-to-day, week-to-week, month-to-month decision- making,” he said. By the time the  acquisitions are fully deployed, panelists said, they may be out of date. Panelists Identified Short- term Steps within the Budget Process and Other Steps That the ATO Could Take under Its Existing Authorities to Address Budget Constraints

While recognizing the magnitude of the ATO’s projected funding shortfall  over the next few years, the panelists identified a number of steps that the  ATO could take to address its current financial situation. These steps  included accepting the budget process as it is and reducing spending to  match revenues, developing strategies for presenting the ATO’s budget  request more clearly to Congress, implementing regulatory and procedural  changes to allow the use of existing cost-saving technologies, contracting  with the private sector to provide certain air traffic services, and obtaining  information on other countries’ ATC technologies and on international  technical standards. This panelist also said that FAA needs a customer-oriented business  strategy and a business plan. financial management systems it has been putting in place. The following is additional information from the ATO’s COO and from  previous GAO reports and work in progress that indicates how FAA is  addressing some of the structural changes that panelists proposed to  improve the ATO’s success over time:  In addition to the business plan that the ATO is developing to guide and  improve its operations and financial management, FAA has worked to  develop three longer term planning documents. Instead, taking a two-pronged approach— telling people “what’s to be done now to get results” and telling them “that  they have an obligation to build for the future”—would be the best way, in  the view of most panelists, for the ATO to meet its immediate and longer  term challenges. National Airspace System: Current Efforts and Proposed Changes to  Improve Performance of FAA’s Air Traffic Control System. Budgetary Factors

FAA Budget Policies and Practices. Structural Issues

Federal Aviation Administration: Challenges for Transforming Into a  High-Performing Organization.
Why GAO Did This Study

In 1981, the Federal Aviation Administration (FAA) began a program to modernize the national airspace system and a primary component, the air traffic control (ATC) system. The ATC component of this program, which is designed to replace aging equipment and accommodate predicted growth in air traffic, has had difficulty for more than two decades in meeting cost, schedule, and performance targets. The performance-based Air Traffic Organization (ATO) was created in February 2004 to improve the management of the modernization effort. On October 7, 2004, GAO hosted a panel to discuss attempts to address the ATC modernization program's persistent problems. Participants discussed the factors that they believed have affected FAA's ability to acquire new ATC systems. Participants also identified steps that FAA's ATO could take in the short term to address these factors, as well as longer term steps that could be taken to improve the modernization program's chances of success and help the ATO achieve its mission. The participants included domestic and foreign aviation experts from industry, government, private think tanks, and academia. They are recognized for their expertise in aviation safety, economics, and engineering; transportation research and policy; and government and private-sector management.

What GAO Found

What Participants Said: Overall, the participants identified cultural, technical, and budgetary factors that, in their view, have affected the progress of ATC modernization. To address these factors, they proposed what one participant termed a "two-pronged" approach--simultaneously taking care of "the here and now" and building a "viable future" for the ATO. Cultural and Technical Factors Have Impeded ATC Modernization: According to participants, the key cultural factor impeding modernization has been resistance to change. Such resistance is a characteristic of FAA personnel at all levels, participants said, and management, in the experience of some, is more resistant than employees who may fear that new technologies will threaten their jobs. The key technical factor affecting modernization, participants said, has been a shortfall in the technical expertise needed to design, develop, or manage complex air traffic systems. Without the technical proficiency to "scrub" project proposals for potential problems early and to oversee the contractors who implement its modernization projects, they said, FAA has to rely on the contractors, whose interests differ from its own. Budgetary Factors Have Constrained ATC Modernization: The most immediate budgetary constraint, participants said, is the multibillion-dollar shortfall that FAA is projecting between available revenues and modernization needs over the next 4 years. Participants also identified features of the federal budget process as constraints, noting, for example, that the federal budget cycle is too long and inflexible to meet the needs of a dynamic ATC system that requires much more managerial freedom and short-term decision making. They further noted that the budget process is influenced by the political process, and that the funding for capital projects is sometimes spread out over so many years that technologies are out of date by the time they are deployed. Annual funding uncertainties discourage strategic and capital planning, they said, and the budget fails to show priorities and relationships among proposed investments. Short-term and Longer Term Changes Could Promote Success: Participants suggested that the ATO could facilitate cultural transformation by creating a vision and strategy that would unite stakeholders and by assembling project teams with different skills and interests whose members could forge common organizational interests by working together to solve common technology development problems. To help offset technical inadequacies, the participants suggested that the ATO could consult an advisory board, identify and consider purchasing needed technologies that other countries have developed, and hire more skilled engineers to provide in-house expertise. To address budgetary constraints, participants suggested, among other short-term steps, reducing spending to match revenues and developing strategies for presenting FAA's budget request more clearly to Congress. Longer term suggestions included giving the ATO the predictable funding and decision-making authority it needs to carry out a "sensible" capital investment plan.