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Summaries from the Study’s First Two Reports

SUMMARY FROM THE STUDY’S FIRST REPORT¹

The congressionally mandated report A New Foundation for the Nuclear Enterprise (the “Augustine-Mies” report), released in November 2014, concluded that “the existing governance structures and many of the practices of the [nuclear security] enterprise are inefficient and ineffective, thereby putting the entire enterprise at risk over the long term.”² The report offered 19 recommendations, many with subcomponents, to improve the effectiveness of the enterprise. The recommendations that are within the control of the Department of Energy (DOE) and/or its National Nuclear Security Administration (NNSA) relate to challenges in the following areas:

• Management structure and processes;
• Decision-making practices;
• Risk management;
• Culture of performance, accountability, and credibility;
• Best practices for shaping and building the enterprise workforce;
• Cost analysis and resource management capabilities;
• Budget and accounting structure;
• Strategy and plan for meeting future needs, including deferred maintenance, infrastructure, and workforce;
• Construction project management capabilities;
• Interactions between management and operating (M&O) contractors and NNSA/DOE;
• Wasteful and ineffective transactional oversight;
• Government–federally funded research and development center relationship; and
• Collaborations and trust with NNSA customers.

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¹ National Academies of Sciences, Engineering, and Medicine and the National Academy of Public Administration, 2017, Report 1 on Tracking and Assessing Governance and Management Reform in the Nuclear Security Enterprise, Washington, D.C.: The National Academies Press, reprinted from pp. 1-4.

² Congressional Advisory Panel on the Governance of the Nuclear Security Enterprise, 2014, A New Foundation for the Nuclear Enterprise: Report of the Congressional Advisory Panel on the Governance of the Nuclear Security Enterprise, http://cdn.knoxblogs.com/atomiccity/wpcontent/uploads/sites/11/2014/12/Governance.pdf?_ga=1.83182294.1320535883.1415285934, p. ix.

Similar issues were raised in another congressionally mandated report released in 2015, Securing America’s Future: Realizing the Potential of the Department of Energy’s National Laboratories (the “CRENEL” report),³ which examined all 17 of the DOE laboratories, including the 3 NNSA laboratories. Its 36 recommendations cover topics such as rebuilding trust, maintaining alignment and quality, managing effectiveness and efficiency, and ensuring lasting change.

Following the release of the Augustine-Mies report, the National Defense Authorization Act for Fiscal Year 2016 (FY2016 NDAA)⁴ called for DOE to develop an implementation plan for responding to the recommendations in that report and similar recommendations. The NDAA also called for a 4½-year study, joint between the National Academies of Sciences, Engineering, and Medicine and the National Academy of Public Administration, to track the actions proposed in that plan and to assess progress. This report is the first in a series of semi-annual reports to be issued over 2017-2020 as part of that study. The overall charge for the National Academies–NAPA study is described in Box S.1. The study panel, in consultation with cognizant staff from NNSA and Congress, decided to focus this first report on steps taken by NNSA to (1) clarify roles, responsibilities, authorities, and accountability; (2) mitigate burdensome practices; and (3) enable change to be achieved and sustained. These themes will be examined in greater detail in additional reports from the panel, along with additional themes.

Many previous reports have emphasized the importance of defining and implementing clear roles, responsibilities, authorities, and accountability within the nuclear security enterprise. Those studies found that overlapping and poorly defined functions and authorities have fostered inefficient and overly risk-averse procedures and cultures within DOE and NNSA. Furthermore, they noted that the lack of clear allocation of responsibilities between the M&O contractors and their federal sponsors has contributed to a significant deterioration in their relationship.

The existence of burdensome practices that limit the efficiency of work in the nuclear security enterprise has also been noted by many previous reports. Elements in the field are subject to oversight by

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³ Commission to Review the Effectiveness of the National Energy Laboratories, 2015, Securing America’s Future: Realizing the Potential of the Department of Energy’s National Laboratories: Final Report of the Commission to Review the Effectiveness of the National Energy Laboratories,https://www.energy.gov/labcommission/downloads/final-report-commission-review-effectiveness-national-energylaboratories.

⁴ Section 3137 of the National Defense Authorization Act for Fiscal Year 2016, P.L. 112-92 (Nov. 25, 2016).

a multiplicity of parties and policies—not only those of DOE and NNSA, but also those of the DOE Inspector General, DOE’s Office of Enterprise Assessment, the relevant NNSA field office, program offices at NNSA, and other federal and non-federal agencies, such as the Occupational Safety and Health Administration, the Government Accountability Office, the Department of Defense, state and local regulators, the Defense Nuclear Facilities Safety Board, and so on. The resulting excessive and uncoordinated oversight—through management processes and through inspections, audits, reviews, site visits, and data calls—fuels inefficiencies, per past reports. Balancing the burden and value of necessary oversight has not been approached systematically, and it could be.

At a higher level, addressing the issues noted in reports such as that from the Augustine-Mies study required the nuclear security enterprise to embark on a program of large-scale change. Experience with change in many organizations has shown that successfully achieving and sustaining improvements to effectiveness, efficiency, and culture across the nuclear security enterprise will require sustained effort and an iterative process. Many management and governance changes have been recommended for DOE and NNSA over the years by many experts and committees, and yet sustained effective change has not been achieved. The FY2016 NDAA noted that correcting the longstanding governance and management problems afflicting NNSA and the nuclear security enterprise would require “personal engagement by senior leaders, a clear plan, and mechanisms for ensuring follow-through and accountability.”⁵ Thus, an approach that explicitly prioritizes sustainable change is necessary to the accomplishment of NNSA’s mission, especially in partnership with its M&O contractors.

In this beginning stage of its study, the panel was impressed to see that longstanding governance and management issues in the nuclear security enterprise have received focused attention over the past 1 to 2 years. The direct involvement of the DOE Secretary and NNSA Administrator has been very valuable and absolutely necessary for this endeavor. In particular, the establishment of an NNSA Office of Policy to serve as a nexus for change management is an important element. It is critical that this momentum be sustained—a challenging requirement given the transition in top leadership and future uncertainty regarding funding and priorities. In fact, for the purpose of clarifying roles, responsibilities, authorities, and accountability—a task that is foundational to addressing other governance and management challenges—the panel believes greater urgency should be demonstrated. For example, although the need for clarification was identified in 2014 or earlier, a new governance construct was not released until 2016, after which a working group was established to resolve implementation details, which is ongoing. Further, an important open question is whether these initial changes are having the desired effect. This first report can assess only the very beginning of what may be a long trajectory.

The panel arrived at the following findings and recommendations, which are numbered here as they are numbered in the full report:

Finding 2.1. Many of the reform efforts called for in the Augustine-Mies report and elsewhere (e.g., reductions in the burden associated with necessary oversight) are contingent on having clarity as to roles, responsibilities, authorities, and accountability. The communications and relationships between NNSA’s M&O contractors and the agency appear to have improved in recent years, thanks in part to the creation of several crosscutting boards and advisory groups. However, there remains considerable ambiguity in roles, responsibilities, authorities, and accountability.

Finding 2.2. DOE and NNSA have issued several new documents and have undertaken other activities to address the recommendations for clarifying roles, responsibilities, authorities, and accountability, both among the officials and offices within DOE and NNSA and between the

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⁵ National Defense Authorization Act for Fiscal Year 2016, H.R. 1735, 114th Cong. (2015-2016).

M&O contractors and their government sponsors. But the panel’s information gathering to date is not yet sufficient to fairly assess the current articulation and implementation of roles, responsibilities, authorities, and accountability (although laboratory staff expressed concerns to the panel) or to ascertain whether the current articulation and implementation are yielding the intended results.

Recommendation 2.1. The NNSA Administrator should demonstrate urgency in efforts to clarify roles, responsibilities, authorities, and accountability, with particular emphasis on clarifying interactions and relationships between NNSA’s management and operating contractors and their government sponsors. Future documents need to resolve ambiguity in several of the earlier policy documents.

Finding 3.1. The mix of burdensome practices affecting the nuclear security enterprise is not characterized precisely enough to lead to targeted interventions for all of them. It would be helpful to know, for example, what fraction of oversight activities are within NNSA’s control, which burdensome practices are contributing the most to “burden” and why, which are associated with overlapping responsibilities, and so on. Such understanding is necessary before rational rebalancing is possible. The panel is not suggesting that a complete inventory of regular or ad hoc audits, investigations, and requests for data needs to be compiled.

Recommendation 3.1. The NNSA Administrator should develop and promulgate criteria to help the nuclear security enterprise understand when a process is adding burden that is not commensurate with its value and establish feedback loops so that burdensome practices are recognized. The nuclear security enterprise can then more rationally determine which practices to re-engineer through working groups that bring together the affected parties. In the long term, NNSA should strive to move away from a subjective debate over “burdensome practices” and seek to adopt a more systematic approach for defining oversight requirements.

Finding 4.1. NNSA has not defined what success looks like as it works toward implementing the recommendations from previous reports, and it lacks qualitative or quantitative metrics to identify and measure change.

Finding 4.2. The change management process in place within NNSA is promising—it has addressed many foundational elements, such as obtaining top-level direction and involving participants from across the subcultures of the nuclear security enterprise. But the first steps of change are not yet fully embedded.

Recommendation 4.1. The NNSA Administrator should define an effective mission-focused operating model as the vision for implementing the changes called for in reports of the Congressional Advisory Panel on the Governance of the Nuclear Security Enterprise and the Commission to Review the Effectiveness of the National Energy Laboratories and elsewhere. NNSA should continue to embrace the concept that change is an iterative process, requiring the sustained attention of leadership and the institution of a mature change management process. NNSA and the management and operating contractors should identify meaningful metrics that can be used to facilitate the identification, measurement, and tracking of change. Results from early change successes should become the foundation for subsequent, iterative actions that support the enterprise in achieving its important mission.

SUMMARY FROM THE STUDY’S SECOND REPORT⁶

A number of external studies over two decades have identified serious concerns about the operations of the nuclear security enterprise. For example, the congressionally mandated report A New Foundation for the Nuclear Enterprise (the “Augustine-Mies” report), released in November 2014, concluded that “the existing governance structures and many of the practices of the [nuclear security] enterprise are inefficient and ineffective, thereby putting the entire enterprise at risk over the long term.”⁷

The National Nuclear Security Administration (NNSA) has embarked on a number of activities to address concerns raised by the Augustine-Mies report and others like it. The Panel to Track and Assess Governance and Management Reform in the Nuclear Security Enterprise was established in 2016 to monitor progress by carrying out the charge described in Box S.1.

While the panel sees promise in several of the activities it reviewed, it strongly concludes that those activities are not rooted in an adequate foundation of strategic thinking. With the release of the 2018 Nuclear Posture Review and the appointment of a new NNSA Administrator, NNSA is faced with an excellent opportunity—and challenge—to move from a tactical to a strategic approach for executing the critical mission of the enterprise. This report calls for NNSA to create two plans expeditiously: (1) an integrated strategic plan for the entire nuclear security enterprise, focused on mission execution, and (2) a more complete and better-grounded plan to guide the ongoing program of governance and management reform. The emphasis in both cases must be on creating a strategic vision that is clearly connected to mission. This is not a call to develop new processes and reports per se, which should follow only once clear and well-rationalized direction has been set.

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⁶ National Academies of Sciences, Engineering, and Medicine and the National Academy of Public Administration, 2018, Report 2 on Tracking and Assessing Governance and Management Reform in the Nuclear Security Enterprise, Washington, D.C.: The National Academies Press, reprinted from pp. 1-3.

⁷ Congressional Advisory Panel on the Governance of the Nuclear Security Enterprise, 2014, A New Foundation for the Nuclear Enterprise: Report of the Congressional Advisory Panel on the Governance of the Nuclear Security Enterprise, http://cdn.knoxblogs.com/atomiccity/wpcontent/uploads/sites/11/2014/12/Governance.pdf?_ga=1.83182294.1320535883.1415285934, p. ix.

Recommendation 2.1. In response to the 2018 Nuclear Posture Review and other policy statements, the new NNSA Administrator should urgently and personally lead the development of a mission-focused enterprise strategic plan that defines where the nuclear security enterprise needs to be in 10 years and what will be needed to get there.

One of the goals of the strategy should be to ensure that the strategies of the various organizations in the enterprise are integrated and aligned. The strategy should focus on mission-related issues but should also address management issues such as those raised in the Augustine-Mies report. The Administrator should “own” the resulting strategy and take responsibility for promoting it throughout the enterprise by articulating what it means for each organization and encouraging discussions that lead to a shared vision and culture.

Ongoing governance and management improvements should continue while the enterprise strategic plan is being developed. The panel found, however, that the current implementation plan that is meant to steer governance and management reform is inadequate for that task:

Finding 3.1. The panel considers the December 2016 DOE-NNSA report to Congress, Governance and Management of the Nuclear Security Enterprise, to be inadequate in several dimensions. Rather than following a careful process of specifying goals and then articulating a plan to achieve them, NNSA has laid out actions it would take without linking them clearly to desired outcomes or explaining why the actions were selected. It does not consider how the various activities will interact to effect the needed changes nor does it convey how the activities will impact mission success. Of equal concern, it gives little indication of how change will be measured—there are no baselines—or how one would know that success has been attained. Furthermore, there is no plan for communicating and socializing the overall goals and progress throughout the enterprise. Such communication is necessary in order to promulgate changes, embed responsibilities for carrying out steps in the plan, and prepare for necessary adjustments to the culture across the enterprise.

An adequate plan to steer governance and management reform should include the following elements:

1. A well-articulated statement of the intended concept of operations and goals (e.g., mission focus, simplicity, and clarity, as well as alignment of resources, organizations, and incentives) and what the intended result will be;
2. A plan for how to achieve the goals and intended results;
3. Active commitment to the goals and vision by senior-most leadership (at both NNSA and DOE);
4. A plan for how to accomplish the change, including centralized leadership and decentralized implementation;
5. Active involvement and engagement of personnel across the enterprise in planning and achieving the change;
6. Regularly scheduled reviews of progress against predetermined measures of effectiveness—with a visible cadence and a sense of urgency—that are conveyed across the enterprise and course corrections to be made as needed to accomplish the pre-set goals; and
7. A plan for communication and reinforcement of the desired attributes of the change through training, leadership activities, performance reviews, and ongoing continuous improvement programs.

Recommendation 3.1. NNSA should expeditiously create an implementation plan to enable achievement of the governance and management changes driven by NNSA’s enterprise-wide strategic goals. This new implementation plan should link proposed actions explicitly to specific goals, including a timeline associated with each action, specification of who is responsible for which parts of the execution and who is accountable for the outcome, and measures to be used to gauge progress and impact.

This implementation plan and the activities described in it will combine to create a path toward major change.

Of the many actions under way to improve governance and management, the new process to improve site governance appears quite promising:

Finding 3.2. Although measures of effectiveness have not yet been established to assess the benefits of the site-governance and management peer review process, the panel believes it represents a useful and promising approach that is already contributing to improved communication, better-defined roles and responsibilities at individual sites, and cross-enterprise learning.

Recommendation 3.2. The NNSA Administrator should ensure that measures of effectiveness are defined and tracked, and then use the site governance and management peer review process across NNSA as a mechanism for communicating and reinforcing shared values/behaviors, strengthening processes and relationships at each site, and improving the usefulness of the sites’ contractor assurance systems.

However, overall the efforts to reform governance and management are greatly hampered by a lack of data and other objective evidence:

Finding 3.3. NNSA lacks systematic data collection—tailored to inform well-specified questions in order to assess the scope and severity of its governance and management challenges and the effectiveness of its improvement efforts.

The panel makes one specific recommendation regarding data collection, both because knowledge of workforce attitudes is fundamental and because relevant survey information may already exist:

Recommendation 3.3. As a first step toward meeting the need for objective evidence and data, NNSA should begin surveying the entire workforce of the nuclear security enterprise (possibly by leveraging existing surveys) so as to gain understanding of attitudes and engagement throughout the enterprise and insight about specific worker concerns.

These recommendations should be acted on quickly and aggressively.