In  addition, a Boston Consulting Group report also noted in 2011 that SEC’s  culture impaired communication and collaboration between divisions. As a result, we recommended that the  Chairman of SEC direct the COO and Office of Human Resources to  (1) prioritize efforts to expeditiously develop a comprehensive  workforce plan, including a succession plan, and establish time  frames for implementation and mechanisms to help ensure that the  plans are regularly updated; and (2) incorporate OPM guidance as  they develop the workforce and succession plans by developing a  formal action plan to identify and close competency gaps and fill  supervisory positions and institute a fair and transparent process for  identifying high-potential leaders from within the agency. As a result, we recommended that the  Chairman of SEC direct the COO and Office of Human Resources to  (1) create mechanisms to monitor how supervisors use the  performance management system to recognize and reward  performance, provide meaningful feedback to staff, and effectively  address unacceptable performance, for example, by requiring ongoing  feedback discussions with higher-level supervisors; and (2) conduct  periodic validations (with staff input) of the performance management  system and make changes, as appropriate, based on these  validations. Although we determined that employee views of SEC’s  organizational culture have generally improved, employee perceptions  about management’s efforts to improve cross-divisional collaboration  remain low and have not changed since 2013. Employees’ Survey Responses Indicate That SEC Continues to Operate in a Compartmentalized Way

Our 2016 survey results indicate that SEC continues to operate in a  compartmentalized manner. SEC Has Taken Some Steps to Improve Personnel Management, but Progress Has Been Limited Overall

SEC has developed mechanisms to monitor supervisors’ use of its  performance management system and developed and implemented a  system to monitor and evaluate personnel management activities,  consistent with our 2013 recommendations in these areas, but progress  to improve personnel management in other areas has been limited. In addition, the results of SEC’s human capital accountability system have  informed the agency’s human capital goals and spending priorities. SEC Continues to Face a Number of Personnel Management Challenges

While SEC has taken some actions to address our 2013  recommendations on workforce and succession planning, performance  management, and cross-divisional communication and collaboration, we  found that these actions were insufficient to address our 2013  recommendations. SEC’s workforce plan lacks a comprehensive  skills gap analysis. As a result, SEC has not fully addressed the  recommendations from our July 2013 report related to workforce  planning, and we maintain that these 2013 recommendations are still  valid. As a result, SEC  lacked information on if and what changes needed to be made and how  best to make them. Without evaluating its  performance management system to identify problems and potential  solutions, SEC may not have assurance that the new system will perform  better than the current system. Of the seven recommendations that we made in 2013, SEC has made the  least progress on the recommendations related to enhancing intra-agency  communication and collaboration. 1). The lack of a central position or office with authority over the daily  operations of all SEC divisions and offices makes it difficult to lead SEC- wide changes to address long-standing management challenges related  to communication and collaboration. Because of the COO’s limited  authority and the absence of another SEC official, other than the SEC  Chair, with the authority over the divisions and offices to take action to  facilitate efforts to improve cross-divisional communication and  collaboration, progress in this area will likely continue to be limited. Hiring and Promotions

SEC’s hiring and promotion policies and procedures are generally  consistent with OPM and other relevant criteria, but SEC lacks assurance  that staff, particularly hiring specialists, know how to implement the  policies and procedures correctly. Without providing necessary training that is informed by a  comprehensive skills gap analysis, SEC may lack assurance that hiring  specialists have the skills required to conduct their work effectively, and  that it is hiring and promoting the most qualified applicants. Because SEC has not conducted a skills gap  analysis across its entire workforce as we previously recommended in  2013, including its hiring personnel, it lacks the information needed to  develop an effective training program. In its written  comments, SEC agreed with the majority of our findings and one of our  two recommendations, but it disagreed with the other. Related to personnel management, SEC acknowledged our second  recommendation in this report to develop and implement training for its  hiring specialists. However, staff in mission-critical offices and  divisions should be enabled to collaborate and communicate with staff in  other offices and divisions. Analysis of Employees’ Views of SEC’s Organizational Culture and Personnel Management

To examine employees’ views of SEC’s organizational culture and the  extent to which they have changed since 2013, we conducted surveys of  all SEC staff, a content analysis of open-ended responses to our survey,  individual interviews with SEC staff, and structured group interviews with  SEC supervisors:  Surveys: To examine employees’ views of SEC’s organizational culture  and the extent to which these views have changed since 2013, we  implemented three web-based surveys of all 4,236 nonsupervisory and  supervisory staff and 148 senior officers. Appendix VII: Percentage of Staff Who Left the Securities and Exchange Commission, Fiscal Years 2008- 2015

Among its provisions, Section 962 of the Dodd-Frank Wall Street Reform  and Consumer Protection Act included a provision for us to review  turnover rates within Securities and Exchange Commission (SEC)  subunits. 2. 3.
Why GAO Did This Study

The Dodd-Frank Wall Street Reform and Consumer Protection Act contains a provision for GAO to report triennially on SEC's personnel management. GAO's first report in 2013 (GAO-13-621) identified a number of challenges, such as SEC's lack of a mechanism to monitor supervisors' use of its performance management system, and included seven recommendations.
This report examines (1) employee views on SEC's organizational culture since 2013 and (2) SEC's current personnel management practices. GAO surveyed all SEC employees (staff in its six key divisions and offices, staff in all other offices and divisions, and all senior officers, with response rates of 69, 60, and 70 percent, respectively); evaluated SEC policies and procedures against relevant criteria; and analyzed information on SEC's practices.

What GAO Found

Employee views on the Securities and Exchange Commission's (SEC) organizational culture have generally improved since 2013. Employees GAO surveyed cited improved levels of morale and trust within the agency compared to 2013 and noted that SEC was less hierarchical and risk-averse. However, GAO's survey indicated that SEC still operates in a compartmentalized way and that there is little communication and collaboration between divisions.
SEC made limited progress on improving personnel management. SEC has addressed two of seven recommendations from GAO's 2013 report, but it faces added challenges in cross-divisional collaboration and hiring and promotion.
Mechanisms to monitor supervisors' use of performance management system . Recently, SEC began to monitor how supervisors (1) provide feedback to staff, (2) recognize and reward staff, and (3) address poor performance. SEC's efforts address the related 2013 recommendation.
Accountability system . SEC implemented a system to monitor its human capital programs and inform its human capital goals consistent with Office of Personnel Management (OPM) guidance. SEC's efforts address the related 2013 recommendation.
Workforce and succession planning . SEC has developed a workforce and succession plan in response to two of GAO's recommendations, but the plan does not include some elements of OPM guidance, such as a skills gap analysis for all SEC staff. As a result, SEC continues to lack assurance that all staff have the necessary skills.
Performance management. Although GAO found in 2013 that SEC's performance management system was generally consistent with relevant criteria, SEC redesigned it in 2014 without first examining its effectiveness—a recommendation GAO made in 2013. SEC officials stated they do not plan any future reviews because they are piloting a new system. As a result, SEC lacks assurance that the new system will perform better than the current one.
Communication and collaboration . SEC has made little progress to address GAO's two recommendations related to improving cross-divisional collaboration. While SEC has recognized some staff for collaborating, it has yet to set expectations for all staff to collaborate across divisions as needed or implement relevant best practices to break down existing silos. As a result, SEC staff still report that divisions operate in isolation. Other than the SEC Chair's Office, which has competing demands on its time, no official has authority to affect the daily operations of the entire agency. Other organizations rely on their Chief Operating Officer (COO) to make such changes, but because SEC's COO lacks such authority, the agency will likely continue to face challenges.
In addition, GAO found that because SEC has not identified skills gaps among its hiring specialists, its training of these staff is limited. As a result, SEC lacks assurance that its hiring specialists have the necessary skills to hire and promote the most qualified applicants, in accordance with key principles of an effective control system.

What GAO Recommends

SEC should (1) provide authority to the COO or other official to enhance cross-divisional collaboration and (2) develop and implement training for hiring specialists that is informed by a skills gap analysis. GAO also reiterates the need to address the remaining five prior unaddressed recommendations on workforce planning, performance management, and intra-agency collaboration. SEC agreed with the second recommendation but disagreed with the first one. In particular, SEC disagreed that enhancing the role of the COO would be the optimal means to achieve further enhancements. GAO maintains that this recommendation will help improve cross-divisional communication and collaboration, as discussed in the report.