To gather information on how annual performance planning and measurement could be used to address the critical planning challenges we observed in our reviews of the September plans, we relied on our recent report on critical challenges needing sustained attention, our report on governmentwide implementation of the Results Act, our guidance for congressional review of Results Act implementation, and our guidance on effectively implementing the Act. Critical Planning Challenges Remain to Be Addressed as Efforts Under the Results Act Proceed

Although the September plans appear to provide a workable foundation for the continuing implementation of the Results Act, we found that critical planning challenges remain. Agencies Can Use the Annual Performance Planning Process to Build Upon Their Initial Efforts to Establish a Strategic Direction

By improving on their draft strategic plans, agencies’ September plans undertook the first steps toward setting a strategic direction for their programs and activities. In our reviews of agencies’ September plans, we found that some agencies have begun to address the challenge of setting a strategic direction. For example, the plan for the Department of Veterans Affairs (VA) contains the following objectives supporting the goal for its compensation and pension area: “(1) evaluate compensation and pension programs and (2) modify these programs, as appropriate.” Also, although the first goal in the Social Security Administration’s (SSA) September plan “o promote valued, strong, and responsive social security programs and conduct effective policy development, research, and program evaluation” sets a strategic direction for the agency, it could be stated in more measurable terms to better enable the agency to make a future assessment of whether it is being achieved. These presentations, and similar ones in other agencies’ September plans that identify agencies with crosscutting programs, also provide a foundation for the much more difficult work that lies ahead—undertaking the substantive coordination that is needed to ensure that those programs are effectively managed. Our work has shown that the next phases of the Results Act’s implementation will offer a structured framework to address crosscutting issues. Performance Planning Can Assist Agencies in Building the Capacity to Gather, Process, and Analyze Performance and Program Cost Information

Our previous work has shown that agencies need to have reliable data during their planning efforts to set realistic goals and later, as programs are being implemented, to gauge their progress toward achieving those goals. Verified and validated performance information, in conjunction with augmented program evaluation efforts, will help ensure that agencies are able to report progress in meeting goals and identify specific strategies to improve performance. The absence of both sound program performance and cost data and the capacity to use those data to improve performance is a critical challenge that agencies must confront if they are to effectively implement the Results Act. Agencies are required under the Results Act to describe in their annual performance plans how they will verify and validate the performance information that will be collected. It also discusses plans for future evaluations and provides a general schedule for their implementation. HHS submitted its revised strategic plan to the Office of Management and Budget and Congress on September 30, 1997. In the September 30, 1997, version of its strategic plan, EPA added the two elements required by the Results Act that were missing from the draft plan: (1) the relationship of the general goals in the strategic plan to the performance goals to be included in the annual performance plan and (2) the program evaluations used in developing its general goals and objectives.
Why GAO Did This Study

Pursuant to a congressional request, GAO reviewed federal agencies' strategic plans submitted in response to the Government Performance and Results Act of 1993, focusing on: (1) summarizing its observations on agencies' September plans; and (2) providing additional information on how the next phase of the Results Act's implementation--performance planning measurement--can be used to address the critical planning issue GAO observed in reviewing the September strategic plans.

What GAO Found

GAO noted that: (1) on the whole, agencies' September plans appear to provide a workable foundation for Congress to use in helping to fulfill its appropriations, budget, authorization, and oversight responsibilities and for agencies to use in setting a general direction for their efforts; (2) agencies' strategic planning efforts are still very much a work in progress; (3) GAO's reviews of September plans indicate that continued progress is needed in how agencies address three difficult planning challenges--setting a strategic direction, coordinating crosscutting programs, and ensuring the capacity to gather and use performance and cost data; (4) GAO found that agencies can build upon their initial efforts to set a strategic direction for their programs and activities; (5) the next stage in the Results Act's implementation--performance planning and measurement--can assist agencies in addressing the challenge of setting a strategic direction; (6) as an agency develops its performance plan, it likely will identify opportunities to revise and clarify those strategic goals in order to provide a better grounding for the direction of the agency; (7) also, as agencies develop the objective, measurable annual performance goals as envisioned by the Act, those goals can serve as a bridge that links long-term strategic goals to agencies' daily operations; (8) the Results Act's requirements for annual performance plans and performance measurement can also provide a structured framework for Congress, Office of Management and Budget, and agencies to address agencies' crosscutting programs--the second critical planning challenge; (9) GAO found that although agencies have begun to recognize the importance of coordinating crosscutting programs, they must undertake the substantive coordination that is needed for the effective management of those programs; (10) the third critical planning challenge is the need for agencies to have the capacity to gather and use sound program performance and cost data to successfully measure progress toward their intended results; (11) under the Results Act, agencies are also to discuss in their annual performance plans how they will verify and validate the performance information that they plan to use to show whether goals are being met; and (12) verified and validated performance information, in conjunction with augmented program evaluation efforts, will help ensure that agencies are able to report progress in meeting goals and identify specific strategies for improving performance.