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Department of Energy

Agency Reinvention Activities

Secretary Hazel O'Leary came to office January 22, 1993, bringing to the Department of Energy (DOE) extensive private-sector experience in market dynamics and quality management. She has placed strong emphasis on results, strategic planning, work force empowerment, and customer satisfaction. In response to the administration's commitment to change, Secretary O'Leary leads as an active participant in the reinvention activities of the National Performance Review (NPR).

Getting Started and Motivating Participation

In a Town Hall meeting at DOE headquarters, broadcast live via satellite to 40 DOE sites nationwide, Vice President Gore stated that DOE "has been leading the way" in efforts to make the federal government more efficient and effective in the way it does business.

In February, as part of her emphasis on improving the department, Secretary O'Leary established 15 teams, called Priorities Teams, to take a hard look at the critical issues that are important to the future of the department. The teams, which include members from across the department, are addressing management, process, and technical policy issues. These teams will report their progress to the Secretary in September.

On March 4, 1993, Secretary O'Leary announced a new organizational structure for DOE geared to achieve the administra-tion's energy, environmental, and economic objectives for a changing world. The new focus is on developing clean energy sources to meet the needs of the economy while protecting the environment, transferring technologies from laboratories to the private sector to enhance U.S. competitiveness, and cleaning up former weapons production facilities to protect public health and safety. "Our goal," the Secretary said, "is to carry out our piece of the promise President Clinton brought with him into office: to reinvent government to make it responsible, accountable, and cost-effective and to put the public's interest first."

On May 10, in a departmentwide Town Hall meeting, Secretary O'Leary shared her vision on how quality management and a quality culture would be used throughout the department to achieve DOE's new priorities.

Secretary O'Leary headed a class of 60 department executives, including laboratory directors, all field operations managers, and key program managers at a July 8-10 training session. The objective of the training program was to begin the process of building a DOE management and leadership team dedicated to meeting the expectations of their stakeholders and customers by providing quality products and services in a timely manner and at a reasonable cost. The overall goal was to develop a plan for reinventing DOE enterprise by applying key quality management principles.

Evolving from teamwork and town meetings, the elements of a strategic planning process for the Department that addresses long-term as well as short-term needs were formulated. The long-term strategy includes two key groups that will lead the depart-ment into the future: the Leadership Group and the Quality Council.

The Secretary chairs the Leadership Group. Senior managers from throughout DOE are members of the group. The Leadership Group was formed to promote implementation of quality management in the department. Specific responsibilities include:

--- promoting the department's strategic direction;

--- committing required resources to the process of quality improvement, customer satisfaction, and work force empowerment;

--- establishing policy to support quality and process improvement initiatives;

--- overseeing the activities of the Quality Council by evaluating, recommending, approving, and implementing proposals;

--- supporting the development of departmentwide performance measures;

--- modeling the department's core values in all aspects of work; and

--- coordinating implementation of the NPR and DOE team activities.

The Quality Council is a diverse group of 27 employees selected from all levels and organizations in the department. Its objective is to design and develop the department's quality implementation plan. In this capacity, the Quality Council will provide advisory support and coordination for all quality activities in the department.

A direct result of this introspective evaluation and strategic planning is a substantial change to the department's organizational structure. The new structure, adopted June 10, 1993, is designed to emphasize the new focus of the department. The organization will meet the new challenges set forth by President Clinton by stressing energy security, sustaining the environment, and boosting economic growth. The department is now organized in functional clusters that include energy programs, science and technology programs, and weapons and waste cleanup programs.

Reinvention Laboratories

Secretary O'Leary's request for candidate reinvention laboratories received enthusiastic response. Among many candidates, the six programs described below are at the fore-front. Others are planned for development after September 7, 1993. The labs are ongoing projects to improve program and management operations using reinventing government principles.

Reinventing the Federal, State, and Local Partnerships. The Office of Energy Efficiency and Renewable Energy (EE) is sponsoring this DOE reinvention lab. The mission of this pilot project is to broaden DOE's network of external stakeholders, to increase understanding of EE's capabilities and goals, and to invent better partnerships. Three specific activities are the focus of this reinvention lab:

--- involve stakeholders earlier and more completely in strategic, multiyear, annual operating and budget planning;

--- invent more effective and flexible ways to implement state and local provisions of the Energy Policy Act of 1992; and

--- build stronger public and private collaborations to deploy new energy efficiency and renewable energy technologies in the marketplace.

The lab will employ a two-step strategy to open dialogue with its customers on how partnerships should be reinvented. The first step was the creation of an ad hoc Core Stakeholders Committee to serve as a gateway to a larger universe of customers. The committee includes representatives of DOE, plus senior managers representing 16 stakeholders organizations.

The committee first met July 27-28, 1993, at the National Renewable Energy Laboratory in Golden, Colorado, to develop three products:

--- a list of changes that EE and the stakeholder group must make to improve their partnerships;

--- ideas and mechanisms that stakeholders and EE should pursue for future partnerships; and

--- performance measures that EE and its customers will use to determine whether the reinvention lab has succeeded.

The Reinvention Lab on Federal, State, and Local Partnership is designed to foster a frank and open dialogue between EE and its stakeholders. It also should broaden EE's list of stakeholders in order to explore new partnerships for technology deployment.

EE anticipates that the outcome of the two-step process will be a candid and thoughtful list of recommendations on the cultural and procedural changes needed in the department to deal with state and local governments, industry, and private organizations more effectively, and, in partnership with them, to more effectively execute DOE's programs.

National Clean Industry Initiative. U.S. industry generates nearly 11 billion metric tons of waste each year -- roughly one ton of waste each week for every U.S. citizen. One estimate indicates that U.S. industries produce approximately five times more waste per dollar of goods sold than Japanese companies and more than twice as much as German companies. Not only does this waste pose a significant environmental threat, it also represents a costly drain on our economy and our natural resources. It signals the inefficient use of energy and materials and inefficiencies that contribute to our rapidly eroding ability to compete internationally. In addition, it signals inefficiencies that may eventually shut out some international markets: the European Commission recently identified green product standards as one of the fastest-growing kinds of non-tariff trade barriers. As the world's population and output continue to grow, so will the economic opportunities associated with developing clean, efficient technologies and industries.

Against this backdrop, the United States is in the process of increasing the general productivity and competitiveness of its industrial base. The administration has recently announced an aggressive technology policy to accomplish this. Several bills have been introduced that are designed to increase the competitiveness of U.S. industry, expanding on the core capabilities and assets of various federal agencies, including DOE. Environmental considerations and environmentally conscious manufacturing are integral to the administration's plan and the proposed legislation.

Realizing the specific goal of clean industry will require leadership that stresses integrated policies, strategies, and plans that recognize the crosscutting, multidimensional nature of this objective. The core capabilities exist in many agencies, most notably DOE, the Environmental Protection Agency, and the Department of Commerce. These resources must be pooled and directed in a way that provides seamless, transparent services and support to U.S. industry, the ultimate end users. Additionally, the problem is not just one of technology; it is one of market incentives, regulations, the business environment, public attitudes and values, corporate mind set, international markets, trade barriers, educational and skill levels in the work force, technical assistance, finance, and communication. These are all areas where the federal government can and must exert major positive influence. This influence must be coordinated and managed as a single system under guiding national environmental and economic principles and policies. The need for a National Clean Technology Initiative is compelling. It pulls together the pieces under a guiding framework and synthesizes the combined efforts of the major stakeholders.

One of the three major goals of the current administration's technology policy is to promote long-term economic growth that creates jobs and protects the environment. A National Clean Industry Initiative that integrates and expands existing federal and state efforts would provide this kind of stimulus. By accelerating the development of innovative clean manufacturing technologies and processes, DOE can make U.S. industry more competitive, encourage U.S. leadership in a new generation of green commercial products, and reduce the impact of economic growth and human consumption on environment.

Reinventing Government at Hanford Reservation. The end of the Cold War has allowed the Hanford Reservation (near Richland, Washington) to move from a defense weapons production site to an environmental cleanup site. In addition, it is changing from a closed and secretive government organization to an open and interactive partnership between government, industry, and community, focused initially on cleanup and ultimately on economic viability.

The Hanford reinvention lab has concentrated initially on two key activities. One is the peeling back of the multiple layers of defense security built up during 45 years of weapons production. The second is the creation of an economic trade environment at Hanford, encouraging entrepreneurs and the private sector to use the laboratories and site operations to develop new technologies.

The reinvention approach to economic transition at Hanford is community-based, not government-based. Hanford has joined the existing local and regional economic development entities and sets policies jointly with outside partnerships. A Northwest Economic Cabinet was formed among DOE's Richland Operations Office and the directors of trade and commerce from Washington, Oregon, and Idaho state governments. The cabinet will develop broad economic issues and coordinate specific business opportunities as the site changes from a government to a private facility.

To date, the economic transition activities have saved over $22 million and created new private sector jobs in the local community. Cleanup milestones have been accelerated and inactive DOE facilities have been put back into economic use. The government has been proactively supporting local economic diversification while conducting its own cleanup business.

Real-Time Access to Oil and Gas Information. The Energy Information Administration's (EIA's) Office of Oil and Gas is seeking new avenues to make oil and gas data and information more readily available to a broader constituency. Early efforts will concentrate on developing an interagency cooperative program with the Department of Commerce (DOC) to use its Economic Bulletin Board and Internet link. (This approach will enable DOE to use an existing network at minimal cost. It represents a synergistic link between energy information being provided by EIA and economic data provided by DOC.)

The real-time access to oil and gas information system will provide weekly, monthly, and annual oil and gas information and will be updated as appropriate. It will be available to the 10 million members of the worldwide Internet community as well as the 35,000 monthly users of the bulletin board. Currently, the data are not integrated into a single information system.

The information system comprises approximately 100 documents that detail the domestic petroleum and natural gas industries, including reserves and extraction from the ground, importation, ultimate consumption, and exportation. The reinvention experiment is scheduled to start in September. Two important advances reflected in this system are: (1) it presents an integrated representation of domestic oil and gas; and (2) it is available electronically, in machine-readable form, rather than on paper.

As part of the reinvention lab experiment, the Office of Oil and Gas plans to carry out user response and marketing surveys to determine the extent of use, characteristics of the user community, and success of the information system in meeting the user's needs and requirements. The customer base includes state and local governments, congressional offices, other federal agencies, industry and economic planners, consultants, academics, and other members of the public who need rapid access to information in electronic format.

Declassification of Information. DOE and its predecessor agencies have a long history of classifying nuclear weapons-related information for valid national security reasons such as minimizing nuclear proliferation. Withholding classified information from potential nuclear proliferants inevitably withheld it from the public. Beginning in World War II and throughout the Cold War period that followed, tens of millions of documents were classified in support of the U.S. nuclear weapons program.

Today, as a result of the dramatic changes over the last few years in the international arena, much information in classified documents no longer warrants classification and could be released to the public. Additionally, unclassified information is often intermin-gled with nuclear weapon technology that is still very sensitive. For example, a document may contain unclassified information relevant to environmental, safety, and health concerns yet still contain legitimately classified technology that should not fall into the hands of a proliferant group or country.

As a result of new domestic objectives, the classification culture of DOE must be expanded beyond its traditional national security focus to include sensitivity to information needs in new areas such as environmental restoration, worker radiation dose reconstruction, and technology transfer. DOE's customers, broadly defined as the "public"--a large constituency ranging from off-site neighbors, environmental researchers, historians, and science and industry workers, to state and other federal personnel--must have access to the information they need in these areas. To meet these new mission objectives, DOE must take radical steps away from its old way of doing business. The document declassification review process itself must be made more effective and efficient to get the needed information into the customers' hands as soon as possible. In addition, the policies that restrict vast amounts of information must be reviewed.

Bonneville Power Administration: Implementing a Business Model for Power Marketing Operations in the Pacific Northwest. For the entire 55 years of its existence, the Bonneville Power Administration has taken a one-size-fits-all approach to meeting the needs of its customers in the Pacific Northwest. Increasingly, these customers--all 130 electric utilities and a number of large industries in the region-- have asked Bonneville to be more customer-focused, market-driven, cost-conscious, and results-oriented. Bonneville supplies half the electricity and 80 percent of the high voltage transmission capacity in the region.

Bonneville's management volunteered as a DOE reinvention lab and launched "The Competitiveness Project." The aim of the project is four-fold:

--- develop a new marketing strategy that would offer a wide array of power and transmission products tailored to the different desires and business plans of Bonneville's customers;

--- streamline, realign, and downsize Bonneville's internal systems to reduce costs and increase responsiveness to support the new marketing approach;

--- change the organization from government to a business-oriented management style; and

--- change to a government corporation.

Looking Ahead

DOE has found strong, early enthusiasm among its customers plus a need to demonstrate to them that the current administration and the department are committed to reinvention, even when reinvention demands fundamental cultural and procedural changes.

The strategic planning process at DOE has accomplished much to set the direction for the future. The department has agreed on a mission statement and a set of core values to guide the department's future service to the nation. External trends have been identified that are most likely to shape the environment in which the department operates a decade from now. The next steps in the strategic planning process will be to develop strategies and action plans to respond to those externally driven trends.

The Federal, State, and Local Partnership Lab anticipates that this partnership will lead to a better understanding between DOE and its stakeholders about the forces that influence their behavior. Also, the lab will help identify new stakeholders who are crucial to successfully commercializing new energy technologies.

The National Clean Industry initiative, led by the Cabinet Cluster on Energy, Environment, and Natural Resources, would effectively respond to the administration's new criteria for U.S. investments in advanced technology by:

--- strengthening America's industrial competitiveness and creating jobs;

--- creating a business environment where technical innovation can flourish and where investment is attracted to new ideas;

--- ensuring coordinated management of technology all across government;

--- forging a closer partnership among industry, federal and state government workers, and universities; and

--- redirecting the focus of our national efforts toward technologies crucial to today's business and a growing economy, such as information and communication, flexible manufacturing, and environmental technologies.

Private sector involvement at Hanford will save hundreds of millions of dollars while establishing a business and job base that will flourish in a post-cleanup era. Cooperative efforts between the community, organized labor, industry, and DOE will create thousands of new private sector jobs to clean up the base.

By 1995, this example of rethinking government is expected to reduce the Hanford security budget by at least one-third of the fiscal year 1992 level. Savings will be returned to programs and will be used in the environmental cleanup of the Hanford site. The security transition team is attempting to ensure that the process of change becomes part of the Hanford culture. To the extent that the security transition succeeds, it holds out hope for additional changes to the ongoing programs and projects at the site that will complement the privatization efforts of the economic transition.

Bonneville managers see their efforts as a first-of-its-kind attempt to establish strategic business objectives in the Pacific Northwest. Its industrial customers, which include one-third of the nation's aluminum smelting capacity, see this as a radical turn in its management.

Needs have changed. In response, DOE must make domestic oil and gas information available electronically to a wide base of customers. Today, less information merits the protection of classification and, therefore, classification itself at DOE needs to be reinvented. Bureaucratic obstacles to efficiency must be overcome (for example, improving government coordination and streamlining the information declassification process). State-of-the-art information processing technology must be developed and utilized to increase productivity and better serve DOE external and internal customers.

In view of the above, and in response to the opportunities afforded by the Vice President's and the Secretary's initiatives, a multifaceted plan has been initiated in order to move DOE from the past to a new era-- an era that recognizes the importance of serving customers, increasing productivity, and providing the tools and incentives to focus on results.

DOE has begun a reinvention process that will continue far beyond delivery of the NPR report to the President. With enthusiastic leadership from the Secretary and an energized, empowered work force, DOE is on its way to becoming an agency that sets the trend for enthusiastic and effective service to the nation.

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