Embassy Construction:

State Needs to Better Measure Performance of Its New Approach

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

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Contact:

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

 

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

 

Office of Public Affairs
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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: Closed - Implemented

    Comments: State concurred with our recommendation, and in subsequent review of the metric determined the target of 1,500 employees per fiscal year was too low. According to State officials, OBO determined that a new target of relocating 3,000 employees per fiscal year into secure, safe, and functional facilities was more appropriate for achieving OBO's overall mission goals. As a result, State increased the target to 3,000 staff per year as part of its Joint Strategic Plan with USAID for fiscal years 2018-2022.

    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 2018, OBO indicated that it plans to implement a new Operation Integrity initiative intended to establish additional key performance measures to assess and improve the execution and delivery of its projects. According to OBO officials, these measures would apply to the entire lifespan of a facility. In addition, they stated that OBO plans to update its Strategic Plan in spring 2019 with information on additional metrics and how those measures will be tied to specific OBO programs. GAO continues to monitor these efforts and will update this recommendation as appropriate.

    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 2018, OBO had prepared a draft policy directive for a Life Cycle Cost Management initiative meant to better track and evaluate the operations and maintenance performance of its buildings. According to OBO officials, the new initiative would determine the most effective way to measure facility operation and management over the course of a project's lifespan. In addition, OBO plans to update its internal processes and tools to integrate life cycle costs analysis into the early planning of new projects as well as evaluate overall efficiency across the life span of all OBO assets. GAO continues to monitor these efforts and will update this recommendation as appropriate.

    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 2018, OBO officials indicated that the scope, resources, and available options to improve project management data are being revisited. OBO officials reiterated their continued commitment to improving OBO's project management data, but indicated that any actions taken to improve project management data may be different than those originally envisioned under OBO's earlier Ideal Operational State Initiative.

    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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