The study, titled "Securing the Future: Management Lessons of 9/11," was released Tuesday by the nonprofit Partnership for Public Service, which produced it in cooperation with contractor Booz Allen Hamilton.
"Hampered by inadequate time to plan, to put the complex new department together and to build internal cohesion [DHS leaders] faced disorganization, resistance from merged entities, turf wars, low employee morale and a wide range of management shortcomings involving procurement, financial controls, information technology and the handling of contractors -- issues that remain today," said an advance copy of the study.
Focusing on DHS and the Office of the Director of National Intelligence, the study offers four major lessons for reflecting upon on the 10th anniversary of the nation's worst terrorist attack. They are based on interviews with numerous leaders involved in standing up the new agencies, as well as a June 23 forum featuring former DHS director Michael Chertoff, former CIA Director Michael Hayden, former House Intelligence Committee member Jane Harmon and Lisa Brown, co-director of the Government Reform Initiative at the Office of Management and Budget.
Unlike similar recent offerings, "Our report focuses on the management lessons of 9/11 and not simply the policy analysis," Max Stier, president and chief executive officer of the partnership, told Government Executive. "Policy choices can never be good without effective management."
The report's chief lessons on reorganizing government are presented under four aphorisms.
"Chain of command is necessary, but not sufficient" discusses the need for leaders of a new and large agency to achieve buy-in from the political and senior career executives who must implement the reorganization.
"The soft stuff is often the hardest to tackle" explains the need for managers to instill the values of the new organization while simultaneously "showing sensitivity to the legacy cultures, histories and traditions of the merged entities" to minimize the inevitable resistance.
"Management is central to mission" describes how leaders focused on the big picture cannot give short shrift to basic functions such as procurement, information technology, human resources and financial operations, while using "every lever possible to create an integrated, enterprisewide approach."
"While structure is important, the organization's super system may be more so" explores outside political forces, such as "the crazy-quilt congressional oversight of DHS, a legacy that reflects and perpetuates the fragmentation of responsibility that the executive branch reorganization was meant to cure."
In reviewing the history of the two new agencies, the report says the 2004 Intelligence Reform and Terrorism Prevention Act left unresolved the fledgling ODNI's authority over its budget and personnel decisions, while "making the success of the DNI largely dependent on personal relationships within the government, particularly when it comes to the president."
Hayden, who became deputy DNI, is quoted saying he had advised the newly appointed director of national intelligence to acquire $20 million just to "stretch those muscles," though his new boss, John Negroponte, decided instead to seek budgetary consensus.
Homeland Security, which became the third-largest federal entity in the biggest reorganization in half a century, was plagued initially by heavy turnover in leadership. One reason is that the George W. Bush administration brought executives in from other agencies to avoid confirmation battles with the 2004 election looming, so teamwork at the new entity was elusive.
Similarly, the Federal Emergency Management Agency saw its resources "diminished during a pre-Hurricane Katrina DHS reorganization, and a demoralized FEMA staff, many with years of disaster response experience, left FEMA," said an analyst for the Government Accountability Office. "By the time that Katrina hit, FEMA had almost one in four positions vacant."
Watching DHS struggle with its identity, National Security Council veteran Fran Townsend grew sympathetic to employee frustrations. "Having been a career person in the federal government for decades, it really does matter who is responsible for my professional development and my evaluation and my promotion potential and opportunities. So when you are detailed outside your home agency, you immediately feel sort of at risk," she said.
Nuts-and-bolts details of the workforce struggles employees faced were provided by Janet Hale, who was brought over from the Health and Human Services Department to be DHS undersecretary for management. She came to the job with "no departmentwide set of services," she noted.
The early days involved getting the list of all 180,000 employees transferred into the department and making sure they were paid. Senior staff had to determine which assets and the services were coming into DHS from other departments, and negotiate memorandums of understanding with those entities to establish timelines and plans for migrating those functions and responsibilities, Hale recalled. "There were over 2,000 different services provided by different organizations that needed to be reconciled, and a process created to integrate them into the department."
In the report's conclusion, the partnership and Booz Allen Hamilton issue a timely plea: "As we enter a period in Washington of budget austerity and reductions in government programs and services, there may be a strong urge to consolidate agencies, and look for savings and greater efficiencies through reorganization," they wrote. "But transforming government agencies can be extremely disruptive, consume enormous energy, divert attention from important policy initiatives and at least in the short run, cost extra, not less, money."