FAA's guide to dropping off the high-risk list

For 14 years, the Federal Aviation Administration was a good case study in how to end up on the Government Accountability Office’s high-risk list of federal programs. Now FAA could teach a course on how to drop off that list.

Life after the list

Getting removed from GAO’s high-risk list is a significant accomplishment, said John Palguta, vice president of policy and research at the Partnership for Public Service.

Of 51 program areas that have been designated as high risk since 1990, only 19 have been removed from the list, he said.

“The implication for agencies is that it’s possible to get off the high-risk list; and if you’re not on the high-risk list, it’s possible to improve,” he said. ”In order to get the kind of improvements that FAA has been able to achieve certainly requires that you pay attention to the kind of employees that you have on staff,” he added.

Although FAA is no longer on GAO’s high-risk list, it won’t be able to become complacent about its accomplishments. FAA is building on those accomplishments and has identified activities to make its management practices a standard part of policy and expected program performance, especially in the area of talent management, Washington said.

“We have an active effort under way to create an acquisition workforce plan that will have specific strategies that are targeted at not just the successful recruitment and hiring of people in system engineering, program management and contract roles but the kinds of things that will lead to better quality performance over time,” he said, such as specific certification. Programs are expected to get only more complex.

FAA has made certification a priority for program managers in the 35 most challenging programs and established a formal best practice of combined academic training, classroom instruction and work experience that are required for Level 3 certification, Washington said.

GAO said it will monitor Next Gen very closely as a high-risk undertaking, Dillingham said.

“We could give the NextGen program the [high-risk list] label in a year or so if it deserves it, but it is new enough and still being defined,” he said.

GAO lists programs that auditors believe are vulnerable to waste, fraud, abuse and mismanagement or in need of broad-based transformation, according to GAO. FAA landed on the high-risk list in 1995 because it suffered from significant cost overruns and schedule delays on its large and complex air traffic modernization projects, which rely extensively on information technology, GAO said.

Its program management problems were costly. Each year, FAA would request more funds from Congress for its projects, and each year, members of Congress would rake the FAA official appearing before them over the coals for not meeting the latest goals for the schedule and costs of their IT modernization projects.

However, since 2003, the agency has taken a series of steps to address chronic deficiencies in acquisition, program management and agency governance. The payoff came in January when GAO published its latest biennial list and did not include FAA.

“The focus on results and having 100 percent of our acquisitions within budget and on schedule for the last four years is a significant milestone,” said Jim Washington, FAA’s chief acquisition officer. If FAA had not produced the desired outcome, FAA would have been seen as “chasing after a standard process without a specific result we could show for it,” Washington said.

Here is how the FAA did it.

1) Commitment at the top

In 2006, then-FAA Administrator Marion Blakey made it a top priority of the agency to get off the list, Washington said. She met with then-Comptroller General David Walker to formulate a strategy, which the agency finalized in June 2007. Blakey also included the priority in its strategic goals for fiscal 2008.

“The administrator’s choice to make that a priority was what caused the rest of us executives to get in line," Washington said. "And with an executive steering group, we drove that process of heavy lifting that demonstrated that we could make this an institutional practice."

But the real turning point might have been in 2003, when the agency established the Air Traffic Organization. ATO consolidated air traffic services, acquisition and programs into a more effective and performance-based organization to prepare for the Next Generation Air Transportation System.

The new organization instilled management accountability and closer oversight of the acquisitions and business processes that were more familiar to the private sector than what the agency had been doing, said Gerald Dillingham, director of physical infrastructure issues at GAO.

“We started to see them reach the goals they had set for 80 percent on time and on budget," he said. "They met their goals for three or four years before we took them off the high-risk list.”

The impetus for change was there. FAA was laying the groundwork for a major modernization effort known as Next Generation Air Transportation System.

As moved forward with Next Gen, it needed to instill confidence in the public, taxpayers and Congress that it could implement the new technologies that would go into the new program, said Dave Bowen, FAA chief information officer. Blakey “saw this as being sort of a stake in the ground that we can be depended on to deliver what we promise,” he said.

2) Assemble the team

FAA assembled a team of four executives, including Washington, Bowen, FAA’s chief financial officer and ATO’s finance executive to oversee the plan and meet with GAO and the Office of Management and Budget on progress, Bowen said.

OMB said it met regularly with FAA and GAO together, first to establish specific quarterly benchmarks for different elements of air traffic control modernization, then to monitor FAA’s progress in achieving those benchmarks.

OMB also worked with FAA on a more regular basis to review progress on individual systems; monitor overall cost, schedule and performance information at a more aggregate level; and ensure that FAA followed sound investment control procedures, an OMB official said.

3) Create accountability

FAA instituted some best practices management processes, GAO’s Dillingham said. First, FAA had to change baselines so cost and schedule estimates would be more realistic for the projects in the modernization program.

Some critics said FAA adjusted its baselines to make programs appear to be on time, but GAO wanted to see how FAA would progress. When IT projects became more than 10 percent over budget or schedule, the executive team reviewed the project, he said.

“In the past, the programs were so siloed that when the program started to go over budget or behind schedule, it didn’t rise to the executive level so the problem could be dealt with,” Dillingham said. “Nobody wants to give bad news to the boss. You put your rationale up and sometimes the rationale isn’t scrutinized as much as it should be,” he added.

Accountability and transparency factors were critical, Dillingham said.

“Everyone was accountable, and it ran all the way through the strategic plan of FAA,” he said. The program manager was attached to the goals of the line of business, and the line of business was attached to the goals of FAA’s strategic plan.

4) Think in terms of investments

ATO brought with it an emphasis on performance and results, Washington said.

The organization began to apply rigorous discipline to analysis of the business case or value of an IT investment before it is approved.

“Those principles are set up in specific terms, such as what we expect the reduction of delays to be as a result of investing in greater decision-making capabilities in our traffic management program,” he said. 

Many agencies can identify with the difficulty in establishing requirements discipline and maintaining focus on the stated requirements through the phases of an acquisition life cycle, Washington said.

“Requirements growth or creep is something that agencies say is causing them to experience huge growth in budgets and missing their target schedules,” he said.

FAA established a series of activities or best practices used by other agencies and the private sector that are successful at managing large IT investments related to the requirements process, risk management, the business case process and contract oversight.

“It’s one of the more significant aspects of the improvement process that we applied,” Washington said.

FAA also is extensively using earned value management software to help improve management of its IT investments and better estimate baselines for IT project costs and schedules, Bowen said.

EVM systems provide managers information for understanding the health of a program by relating data about project resource planning to costs and schedules.

NEXT STORY: Bill would require DOD to study IT

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