Embassy Construction:

State Needs to Better Measure Performance of Its New Approach

GAO-17-296: Published: Mar 16, 2017. Publicly Released: Mar 16, 2017.

Additional Materials:

Contact:

Michael J. Courts
(202) 512-8980
courtsm@gao.gov

 

David J. Wise
(202) 512-5731
wised@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

Will State's new approach produce better embassies, and how will we know?

In 2011, the State Department began to shift from using a standard design for the construction of its embassies to customizing each embassy's design. This new approach (called Excellence) was meant to improve the appearance and functionality, as well as reduce the operating costs of these embassies.

However, we found that State does not have performance measures or sufficient data to evaluate these and other goals of Excellence. We recommended that State strengthen its performance measures, as well as its monitoring and reporting tools, for the Excellence approach.

U.S. Embassy in Panama Constructed under Standard Embassy Design and Rendering of U.S. Consulate General in India to Be Delivered under the Excellence Approach

 

Additional Materials:

Contact:

Michael J. Courts
(202) 512-8980
courtsm@gao.gov

 

David J. Wise
(202) 512-5731
wised@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

What GAO Found

In 2011, the U.S. Department of State's (State) Bureau of Overseas Buildings Operations (OBO) established the Excellence approach in response to concerns regarding the aesthetics, quality, location, and functionality of embassies built using its Standard Embassy Design (SED). The SED utilized a standard prototypical design for new embassies and consulates along with a streamlined delivery method combining responsibility for design and construction under a single contract. Under the Excellence approach, OBO now directly contracts with design firms to develop customized embassy designs before contracting for construction. OBO officials believe that greater design control under Excellence will improve embassies' appearance in representing the United States, functionality, quality, and operating costs.

Excellence consists of several key elements and involves trade-offs. For example, OBO now allots time and funding to develop customized designs and hires leading design firms to produce them. These design firms have faced initial adjustment challenges designing U.S. embassies, and OBO only recently began evaluating their performance as required by federal regulation. OBO's new approach poses cost and schedule trade-offs since, for example, OBO now has greater design control but may also be responsible if design problems are identified during construction. GAO's survey found that OBO staff who responded held split or conflicting opinions on Excellence compared with SED.

U.S. Embassy in Panama Constructed under Standard Embassy Design and Rendering of U.S. Consulate General in India to Be Delivered under the Excellence Approach

U.S. Embassy in Panama Constructed under Standard Embassy Design and Rendering of U.S. Consulate General in India to Be Delivered under the Excellence Approach

While OBO has established guidance to implement Excellence, it lacks tools to fully evaluate the performance of this new approach. Performance measures are essential tools for managers to evaluate progress toward a program's goals, as noted in Standards for Internal Control in the Federal Government. However, OBO has not established performance measures to specifically evaluate and communicate the effectiveness of Excellence in delivering embassies. Moreover, OBO's bureau-wide strategic measures do not address Excellence priorities, such as greater adaptability to individual locations, functionality, or sustainability. OBO also lacks a reliable system to monitor operating performance, such as building energy usage, and a centralized database to broadly manage the Excellence program, to include effectively reporting on projects' design and construction costs and schedules. Without performance measures and reliable systems to collect and analyze relevant data, OBO cannot fully assess the value of shifting to the Excellence approach and away from the SED.

Why GAO Did This Study

In 1998, terrorists bombed the U.S. embassies in Nairobi, Kenya, and Dar es Salaam, Tanzania, killing over 220 people and injuring 4,000. In 1999, State began a new embassy construction program, administered by OBO, which to date has received $21 billion, according to State. OBO's primary goal was to provide secure, safe, and functional workplaces, and it adopted SED with a streamlined, standard design for all embassies. In 2011, OBO replaced the SED with the Excellence approach, which makes use of customized designs for each embassy.

GAO was asked to review the implementation of Excellence. This report examines (1) the reasons for State's shift to the Excellence approach, (2) key elements and tradeoffs of the new approach, and (3) the extent to which State has established guidance and tools to implement and evaluate its Excellence approach. GAO analyzed information from State policy, planning, funding, and reporting documents and interviewed State and industry officials. GAO also surveyed OBO staff about, among other things, the sufficiency of OBO's policies, procedures, and technical guidance for the Excellence approach. GAO will examine project cost and schedule issues in a subsequent report.

What GAO Recommends

GAO is making four recommendations that State take several steps to strengthen performance measures and reporting, monitoring mechanisms, and data systems for the Excellence approach. State concurred with all four recommendations.

For more information, contact Michael J. Courts at (202) 512-8980 or courtsm@gao.gov, or David J. Wise at (202) 512-5731 or wised@gao.gov.

Recommendations for Executive Action

  1. Status: Open

    Comments: OBO stated that it would perform a multi-year, comprehensive evaluation of this performance metric and determine whether the target remains appropriate. As of October 2017, OBO anticipated this evaluation to be completed in fiscal year 2019.

    Recommendation: To better assess OBO's performance, the Secretary of State should determine whether the existing OBO program performance measure and annual target of moving 1,500 people into safe, secure, and functional facilities is still appropriate or needs to be revised.

    Agency Affected: Department of State

  2. Status: Open

    Comments: As of October 2017, OBO had stated it would develop Excellence-related performance metrics to assess the execution and delivery of its projects. Specifically, these would be tied to the Bureau's strategic plan, which is reviewed annually and updated every three years. The next strategic plan update was estimated to occur in early 2020.

    Recommendation: To better assess OBO's performance, the Secretary of State should establish additional performance measures applicable to the new goals of the Excellence approach in support of the Capital Security Construction Program.

    Agency Affected: Department of State

  3. Status: Open

    Comments: As of October 2017, OBO was engaged in a life cycle cost analysis methodology project intended to take an in-depth look at OBO's processes, practices, and procedures, compare and contrast them with best industry practices, and make recommendations to the bureau. OBO anticipated finalizing this by early 2018.

    Recommendation: To better assess OBO's performance, the Secretary of State should finalize the mechanisms OBO will use to better track and evaluate the actual operations and maintenance performance of its buildings--whether Excellence or SED--and document through appropriate policies, procedures, or guidance.

    Agency Affected: Department of State

  4. Status: Open

    Comments: As of October 2017, OBO was working on the implementation of its Ideal Operational State initiative, which it envisioned as a multi-year effort subject to budget realities. OBO anticipates having an integrated program schedule by early 2018, although full implementation would take longer.

    Recommendation: To better assess OBO's performance, the Secretary of State should finalize the mechanisms OBO will use to centrally manage project management data (to include project cost and schedule information), currently termed the Ideal Operational State, and document through appropriate policies, procedures, or guidance.

    Agency Affected: Department of State

 

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