AID Management:

Strategic Management Can Help AID Face Current and Future Challenges

NSIAD-92-100: Published: Mar 6, 1992. Publicly Released: Mar 6, 1992.

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GAO provided information from its general management review of the Agency for International Development (AID), focusing on: (1) current AID efforts to introduce strategic management compared to a GAO model for strategic management developed for use in other agencies; and (2) persistent management problems and future challenges facing AID.

GAO found that AID: (1) has no clear priorities or meaningful direction because of significant and recurring management problems in its operations; (2) operations emphasized project design and obligation of funds more than program effectiveness and results, due partly to a budget cycle in which most funds are returned to the Treasury if not obligated in the year appropriated; (3) does not have a work force that reflects its current needs or a work-force planning system; (4) lacks an adequate financial and information resource management system; and (5) has not clearly defined responsibilities, and various AID headquarters offices perform redundant activities. GAO also found that: (1) AID has taken such steps to introduce strategic management as assigning management groups to tackle major weaknesses, and strengthening its evaluation resources and mission to better access and communicate program and management successes and shortcomings and provide meaningful feedback; and (2) despite those efforts, AID still lacks a clearly articulated strategic direction shared by key internal and external groups.

Recommendation for Executive Action

  1. Status: Closed - Implemented

    Comments: Under a recent reorganization, the Policy Directorate was established as the Office of Policy and Program Coordination. AID is strengthening this Office's capacity for, among other things, strategic planning, policy development and communication, sectoral strategy development, resource projections, and performance evaluation. In January 1994, the Administrator outlined his vision of a strategic management process. This process will include a broadly participatory process of strategic planning; rigorous review of mission and bureau portfolios; continuous consultations, including NGOs and other donors; and the systematic measurement, collection and analysis of performance information. Through the design of a new operations system, AID plans to integrate systems for making management decision on programs, budgets, operations and personnel levels. The system is also designed to ensure accountability and monitoring of AID's sustainable development programs and activities.

    Recommendation: The Administrator, AID, should establish a strategic management process and take the steps necessary to identify key issues to be resolved and articulate a clear strategic direction shared by key internal and external groups. Establishing a strategic management process would include, among other things, ensuring that the systems for making management decisions on programs, budgets, operations, and personnel levels are integrated and include accountability and monitoring.

    Agency Affected: United States Agency for International Development


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