Report 2001-115 Summary - December 2001
Technology, Trade and Commerce Agency:
Its Strategic Planning Is Fragmented and Incomplete, and Its International Division Needs to Better Coordinate With Other Entities, but Its Economic Development Division Customers Generally Are Satisfied
Our review of the Technology, Trade and Commerce Agency (agency) found that: The agency has no agency-wide strategic plan, and many program plans continue to lack elements of strategic planning including:
- Goals for all significant aspects of program missions.
- Targets for significant goals or targets that challenge performance.
- A comparison of results to targets in external reports. Further, external coordination of export services is limited for the agency's International Trade and Investment Division, but recent activities indicate a renewed focus on this issue.
RESULTS IN BRIEF
The Technology, Trade and Commerce Agency (agency) is responsible for promoting economic development in California. The agency administers programs to support economic development, promote international trade and foreign investment, and support technology use and development in the State. These diverse programs range from assisting small business development centers to promoting California exports abroad. Although the agency reports success in many of its endeavors, it does not use agency-wide strategic planning to enhance its effectiveness. After making some progress in establishing an agency-wide strategic plan in 1997, the agency has discontinued an agency-wide planning process and backed away from a results-oriented approach. Program-specific plans now guide its actions, but all the plans we reviewed are weakened by a lack of strategic planning elements. Many plans do not include all goals significant to their mission; some do not set quantified targets for their goals; and some have targets so low they do not challenge performance. For example, the foreign office in Mexico, whose primary mission is to promote the State's products overseas, does not include outcome goals for the office as a whole but instead an outcome goal-increasing exports-for two staff members. Moreover, this plan lacks quantified targets for any of its stated goals. In addition, the Infrastructure State Revolving Fund Program, a program that finances infrastructure throughout the State, has a plan with no outcome goals. Further, the programs' internal and external reports rarely compare targets that do exist with actual results. Such planning deficiencies reduce accountability within the agency and to stakeholders such as the Legislature.
The agency contends that the recent energy crisis, a dynamic environment, and staff vacancies have hampered its strategic planning. It says the governor's administration, the budget process, and legislative initiatives, as well as individual program plans, now direct the agency's activities. Nevertheless, by de-emphasizing strategic planning, the agency is forgoing the benefits of taking a broad, outcome-based approach to focus the efforts of programs on overall goals and to evaluate the programs' success in meeting goals. The agency, by relying instead on individual program plans that omit essential elements of strategic planning, lacks a basis to integrate its diverse programs and allocate limited resources to fulfill its mission most effectively. Also, without adequate strategic planning, the agency lacks an effective way to demonstrate that it is wisely using the more than $200 million spent on its programs each year.
On another front, the agency's International Trade and Investment Division (International Division) has done an uneven job of coordinating with other entities working in the international arena. Without effective coordination, the agency cannot ensure that it has fully leveraged the State's resources and addressed possible gaps and redundancies in the delivery of services. The International Division appears to have adequately coordinated its foreign investment services with other entities, but its coordination for its export-related services has been limited. The International Division does not hold regular, broad-based coordination meetings with other entities working in the international arena. It also has experienced problems coordinating with the California Department of Food and Agriculture and the California Energy Commission. The agency explains that, during the transition between state administrations, it focused on rebuilding its operations rather than on coordination. Despite indications that the International Division is trying to better coordinate with other entities, it has much to do. To improve coordination, the agency needs to meet with other entities, identify avenues of cooperation, and reach mutual agreement on roles and responsibilities. In addition, the delivery system for export-related services needs further study to determine the best way to leverage the State's limited resources.
In another area, programs in the agency's Economic Development Division are generally responsive to customers' needs despite a lack of processes to measure customer satisfaction. These programs' relatively small circles of customers generally are satisfied with the services they receive, as shown by their responses to a customer survey that we conducted. Nevertheless, the Small Business Loan Guarantee Program needs to work with its customers to resolve concerns they expressed on our survey. Additionally, all programs could benefit from some formal processes to measure customer satisfaction, such as setting targets for customer satisfaction levels and using surveys to obtain feedback.
To ensure that the diverse programs and activities administered by the agency demonstrate their worth and perform at their optimal level of efficiency and effectiveness, the agency needs to take the following actions:
- Develop a long-term, agency-wide strategic planning process that includes all goals that are significant to its mission, outcome-related goals, quantified targets for goals, and reporting that compares actual results with targets.
- Report to the Legislature biennially on its progress in implementing a strategic approach to its planning.
In addition, the Legislature should consider commissioning an independent statewide study of the existing delivery system for export services to determine the best division of efforts among international trade entities.
To ensure that the Economic Development Division is meeting the needs and expectations of customers, the agency should set customer service goals and targets and periodically survey customers to determine their level of satisfaction and areas that may need improvement.
Overall, the agency states that it will use the input from our report to enhance its planning process and its provision of services to the international trade and economic development communities. With respect to strategic planning, although the agency contends that the planning process it has adopted is the best means of ensuring that its programs are delivered in an effective and efficient manner, it indicates that it is planning to implement many of our specific recommendations. Additionally, the agency commented that it is committed to increasing the level of coordination with federal, state, and local entities; however, it did not specifically address what it plans to do in response to some of our recommendations to improve coordination. Finally, the agency indicates that it is planning to implement our recommendations regarding customer service in its Economic Development Division.