Part 2 Introduction: Leaders and Their Strategic Plan that

Transformed Their Organization

Part 1 of this book set forth a model of strategic planning that I have successfully shared with my students and my professional associates for several decades. In Part 2, I will share the chal- lenges faced by six highly regarded government executives who were able to apply the critical success factor approach presented in Part 1 to affect a dramatic transformation in their agency.

In the interest of full disclosure and transparency, I readily acknowledge that I played a key role in each instance—serving as an advisor to each agency executive. This notwithstanding, in each instance, I was captivated by the passion and commit- ment of each leader as they tried to “fit” the CSF Model to their own circumstance. In so doing, each sought to refrain from high-minded academic abstractions and focus on the real prob- lems of real people in real organizations. While I developed pro- posals for many of the processes that were ultimately utilized, the successes that you will read about were the result of their devotion to the values of public service and their commitment to the leadership construct that I call performance ethics.

Performance Ethics

In recent years, government at all levels has created a new awareness and concern for ethics. The emphasis, however, is pri- marily negative. The focus is much more on rules and regulations that proscribe and restrict behavior rather than on the positive attributes of ethical leadership. Contemporary programs catalog behaviors that are deemed improper, provide warnings against transgressions, and impose sanctions when the rules are abro- gated. Rarely does a discussion assert the positive components of an ethical doctrine, and the responsibility of leaders to ensure that the right policy is pursued, the right decisions are made, and the right actions are taken.

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Unfortunately, as well-meaning as they may be, people in government are seldom able to deliver the transformative suc- cess promised in reform agendas. The ethical doctrine suggested above requires the ability to distinguish leadership from man- agement. Managers can get their workforce to complete mechan- ical tasks, but only leaders can motivate people to think creative- ly, solve problems, and transform an organization. A strategic planning process that does not recognize this distinction is likely to put far more emphasis on the process rather than on the out- comes that are expected to result from those processes. While a process-focused strategic plan may make the organization more efficient, an outcome-driven strategic plan developed and driven by the organization’s leadership is far more likely to produce public value (Moore, p. 63).

Over the past decade, I have asked hundreds of public em- ployees to (1) draw a distinction between leadership and man- agement, and then (2) identify the attributes of the leader they would hope to work for. The responses received from senior offi- cials, retired government employees, and those in mid-career co- alesced around five key attributes listed below, which now form the basis of my leadership training:

1. A predisposition to do the right thing; not the most expedient, self-serving, or politically correct thing;

2. Moral courage, the ability to speak truth to power; and the wisdom to know when and where to speak out effectively;

3. Commitment to match words with deeds and to follow through on assurances, agreements, and undertakings;

4. Personal responsibility and organizational accountability for results (both successes and failures);

5. Mutual trust and a culture that reflects it.

While I expected a general acceptance of these attributes as a sound way of assessing the expectations of good leadership from the perspective of followers, I have been very surprised that so few leaders are seen to be meeting these standards. For the past 10 years, I have routinely asked students and professionals taking my courses to rate their own leader (using a scale or 5 to 1) on each element. The effort produces a useful performance

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ethics index which repeatedly shows that very few leaders score high on all attributes. A surprising large percentage are ranked very low while the majority fall somewhere in between.

If each of these attributes can be considered an essential re- quirement of transformational leadership, and if this non-scien- tific assessment can be accepted as arguably valid, then it be- comes easy to understand why inconsistent and disingenuous leadership is often seen as the cause of strategic planning fail- ures. Fortunately, the leaders profiled in this book all score very high on the performance ethics index, a factor that should be considered an important part of their strategic planning success.

My experience with dozens of government agencies and hun- dreds of government employees has led me to view this frame- work as the centerpiece of an approach that reflects the attributes of real leaders who have led committed people toward successful performance. Where we have seen operational success, we have seen the attributes of performance ethics. Where we see contem- porary policy voids, we see their absence. And frankly, many en- vironments, we often see the lack of a moral compass to even suggest a proper direction.

Strategic plans and the process associated with their devel- opment are more likely to bring a level of excitement and en- gagement to the workforce if the strategic plan is understood to be the personal priority of the agency director and senior exec- utives. Once it is generally understood that upper management views the strategic plan as providing the only credible path to achieving high-impact results, the strategic plan and the plan- ning process become regarded as among the most important management activities of the organization.

The Performance Imperative

We are now confronted with new challenges, as well as difficult and dangerous circumstances. These circumstances, in and of themselves, place an ethical responsibility on our leaders to act wisely, boldly, and in a manner consistent with the public’s val- ues. In recent years however, we have consistently focused on improving management processes while minimizing leadership, which has resulted in a daunting leadership void, unaddressed ethical and moral challenges, and stagnant performance.

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Our concept of strategic planning success requires high-im- pact performance that is driven by committed leaders who are focused on achieving results in support of the public interest. It differs from previous reform efforts in that success is defined in terms of the results achieved, not the processes undertaken. And in the current era, the results we seek – healthcare, public safety, immigration, homelessness, the environment – all have a strong ethical dimension.

The study of ethics in the public sector typically centers on one of three approaches. The most common, of course is the per- sonal approach, one that focuses on personal integrity, honesty, and morality and urges public officials to act consistent with eth- ical standards in all of their official duties. A second approach, commonly referred to as corporate social responsibility has been increasingly embraced by corporations, especially in the wake of the Enron scandal. This approach encourages corporations to recognize their dependency on the community within which they operate and to participate in activities that balance an exclusive concern for profit with concern for the community. Corporations should assist the community in times of need and give back to the community by participating in worthy causes.

The third approach is the subject of Part 2 of this book. This approach focuses on the ethical responsibility of public sector leaders to ensure that the expectations of citizens are addressed to the maximum feasible extent. This approach suggests that leaders of public agencies have an ethical responsibility to do all that is humanly possible to maintain security, provide health- care, ensure a clean environment, and to regulate industries to ensure public health and safety. From this perspective, failure is not an option

Those endorsing the third approach believe that public of- ficials who ignore this mandate or are satisfied with mediocre performance are putting the public at risk. Officials who do not accept this approach are abdicating their public service respon- sibilities, committing a significant ethical transgression, and are contributing to the diminution of public trust. As such, there is no higher calling among public officials than in maintaining an ethical standard of performance consistent with their mission responsibilities. I also believe that the public organizations that are most likely to meet this standard are those that are led by

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individuals who accept the responsibilities of ethical leadership and personally engage in a well-designed and purposeful strate- gic planning process.

Leadership in Action

Part 2 of the book chronicles the leadership-driven transforma- tion of five public agencies, each of whom sought to incorporate the attributes of performance ethics into the culture of their agency. Officially, each of these case studies centers around a well-designed strategic planning process. However, to under- stand this transformation, the reader must fully grasp the in- dispensable role that ethical leadership played in the agency’s success.

In Part 1, we carefully describe the critical success factors associated with effective strategic planning, the first of which is engaged leadership. But merely discussing the merits of engaged leadership does not convey the difficult choices, the high risks, the personal engagement, and the unwavering commitment of each individual who rose to the challenges of leadership. Part 2 of this book now focuses on the actual experiences of each of these organizations so that readers can share the journey taken by each leader.

As you share with them their vision, the daunting obstacles they faced, their tremendous successes, and their heart-breaking disappointments, you will better understand both the fragility of public sector strategic planning and its continuing relevance for anyone hoping to transform government.

Ethical Leadership and the Transformation of the FBI

This section of the book chronicles the leadership-driven trans- formation of six leaders. Each of these case studies involves a strategic planning initiative that produced a comprehensive transformation in their organization’s performance, operation, and culture. However, to understand the nature of the transfor- mation that occurred, the reader must be familiar with the in- dispensable role that ethical leadership played in these achieve- ments.

FBI Leadership in the Aftermath of the Cold War (1996 – 2006)

In the aftermath of the terrorist attacks on New York City on September 11, 2001, FBI leadership was thrust into a highly vis- ible national dialogue about the long-term and short-term pros- pects of American safety and security. What is not well under- stood is the internal dynamics and forces that permitted the FBI to progressively move forward over a very difficult 10-year pe- riod. During this period, four different senior executives within the FBI played critical roles in raising difficult questions, identi- fying the changes that needed to be made, developing innovative and controversial strategies, and working hard to ensure the ul- timate acceptance of a new paradigm for emerging FBI leaders.

The chapter will briefly profile the contributions of the fol- lowing four senior FBI executives:

Linda Pagelson—the FBI Budget Officer was one of the first to understand the emerging threat the role the FBI could play to address it. She used all of her influence to set the stage for the project.

Bob “Bear” Bryant—the highly regarded Deputy Director of the FBI who clearly understood the changing world and the FBI’s inability to address the changing requirements, and, by the sheer force of his personality, put in place the first enterprise-wide strategic planning process in FBI his- tory.

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Dale Watson—a fast rising FBI executive in the late 1990s who was asked to establish the first FBI Counterterrorism Division and institute a strong and centrally directed pro- gram that was intended to prevent a terrorist attack in the United States.

Dave Szady—a legendary rogue FBI counterintelligence agent who had great vision and spoke with clarity about emerging and, unaddressed counter intelligence threat, and the FBI’s ethical responsibility to reverse the ominous trend and secure a different future.

In the immediate aftermath of the Cold War, the FBI recog- nized that it was at a crossroads and was facing difficult ques- tions about its future. For the previous 50 years, the FBI had distinguished itself as being among the elite law enforcement and national security agencies in the world. This large organi- zation had a presence in nearly every community in the United States and was respected by the international law enforcement/ intelligence community. FBI investigations were generally high- ly efficient and often successful in apprehending their targets. From a programmatic perspective, the FBI had defeated Nazi and Communist espionage, the Ku Klux Klan, organized crime (La Cosa Nostra), and mitigated the Savings and Loan scandal of the 1990’s—virtually eliminating those problems as major na- tional concerns.

It is important to note that these successes were achieved in a world in which the US had only one major adversary (The Soviet Union), and one primary responsibility which was inves- tigating and apprehending law violators—a function in which they then excelled. Although it suffered harsh criticism as a consequence of some significant policy overreaching and in- volvement in overtly political matters in the 1960’s and 1970’s , the FBI’s overall reputation as a highly competent and effective agency was unquestioned.

During the latter part of the twentieth century, the FBI en- joyed a massive resource base that dwarfed the resources of any other law enforcement agency. Personnel resources were de- ployed in virtually every community in the United States so that an American citizen was never more than a two-hour drive from an FBI office. Congress provided the Bureau with all the tech-

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nological equipment and staff it needed to conduct a full range of surveillance, including electronic eavesdropping and commu- nication intercepts on almost any matter at almost any time. Although it was not automated, the FBI filing system and re- cord-keeping practices were the envy of the world as the Bureau employed thousands of file clerks who recorded data on 3 x 5 index cards and maintained a massive filing system that could identify a lead anywhere in the country in a matter of hours. And of course, the FBI’s sophisticated fingerprint and forensic pro- grams were utilized by state and local police and other federal agencies throughout the nation.

It should be noted that during this time, the FBI was a decen- tralized organization. The 56 offices of the FBI were each man- aged by Special Agents-in-Charge (SACs) who were permitted to set their own priorities, deploy resources as they felt appropriate, and organize the field office in a way that was consistent with local priorities. The primary function of FBI Headquarters was to provide administrative support and resources to the 56 field offices and general guidance on matters of national significance, primarily foreign counterintelligence, espionage, and organized crime. A culture of field office independence from FBI headquar- ters was reinforced throughout the FBI’s management system.

However, the world changed dramatically in the late 1980’s with the fall of the Soviet Union and the subsequent reallocation of resources to domestic programs. The US government respond- ed to the fact that the United States was the only remaining superpower in the world by declaring a “peace dividend” based on an expectation that spending on national security programs would be drastically reduced. Government planners also saw no need to continually enhance law enforcement and security oper- ations. The FBI and other agencies were required to significant- ly reduce funding and deemphasize national security.

As is often the case, world events did not cooperate as the US had hoped. Almost overnight, threats began emerging in the newly freed nations of Eastern Europe, old conflicts began to re- emerge in the Middle East, counterrevolutionary movements and insurrections began occurring throughout the world. In re- sponse to the rapid escalation of terrorist threats and terrorist acts against American citizens and American interests, the FBI was designated as the lead US counterterrorism agency.

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Domestic terrorism also dramatically increased in the 1990s as evidenced by the Oklahoma City bombing and very public and highly controversial and violent confrontations with the FBI in places like Waco, Texas; Helena, Montana; and Ruby Ridge, Idaho—all of which called the nation’s attention to serious prob- lems in the FBI. This, coupled with internal scandals erupting within the Bureau led to resignations, fines, criminal convic- tions, and jail sentences for a few FBI senior officials for the first time in its history. This in turn produced a significant decline in morale and confidence within the FBI.

Also during this time, a wide range of local crimes began re- ceiving national attention. Drug trafficking, crimes on Indian reservations, cybercrimes, abortion clinic bombings, and finan- cial fraud became matters referred to the FBI by congressional committees, the White House, and the Attorney General which often requiring a nationwide mobilization and an immediate high priority response. Bureau agents and management re- ferred to this revolving door of high priorities as “the flavor of the month.”

The problems were exacerbated by the realization that the FBI’s unquestioned ascendancy in administrative and re- cord-keeping capability was rapidly coming to an end as new technology was being developed and made available to other fed- eral, state and local organizations, causing them to reduce their reliance on the FBI for technical support. Paper records and 3 x 5 index card filing systems, the heart of the FBI’s administrative management system, had become obsolete. New demands for intelligence and technology-driven intelligence analysis made the manual file review and research intelligence processes of the FBI seem like relics of a bygone era.

The 1998 FBI Strategic Plan

At the turn of the twenty-first century, the public expectations of the FBI were also undergoing a significant change. The gov- ernment-wide emphasis on achieving results required a funda- mental change in the FBI’s direction and capabilities. No longer was it sufficient to catch a criminal or terrorist after an inci- dent occurred. The FBI was now expected to have a proactive program that would prevent terrorism and reduce crime. This subtle but dramatic change in expectations required a different

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management approach, different skills and capabilities. The FBI needed new leadership capable of planning and overseeing the complete transformation of one of the largest organizations in the US government.

The FBI’s decentralized organizational structure exacerbat- ed this challenge as the role of FBI headquarters (FBIHQ) was largely viewed as providing support to field operations. Moreover, executives at FBIHQ at the time were rotated in and out of man- agement positions very frequently—often after tenures of less than two years, which prevented them from developing the kind of power base, influence, and expertise necessary to launch ma- jor initiatives. As a result, FBI executives in every division were viewed as either just arriving or about to leave and had no abil- ity to develop or even think about the transformation that they all believed imminent.

Moreover, FBIHQ lacked even the basic attributes of a mod- ern, centralized organization. Their IT systems were not net- worked, they had limited email capacity, no interoperable record systems, no automated search capability over its hundreds of thousands of records, and no ability to function like a modern agency. Field offices maintained a very effective reactive capa- bility and conducted many outstanding investigations, but any effort to set national priorities, redirect resources, implement new and proactive approaches or develop a strategic plan failed miserably.

The agency with unquestioned expertise in every facet of ev- ery investigative program became an agency struggling to find its identity in the emerging world. Much of this criticism was self-generated in the 1998 FBI Strategic Plan—which focused on the need to fundamentally transform its operations and was extremely candid in acknowledging its operational, managerial, and cultural shortcomings. In its review of the FBI’s capabilities and challenges in the years immediately prior to the 9/11, the es- teemed 9/11 Commission reviewed the FBI’s recent history and concluded that the FBI was in need of fundamental change:

The Bureau issued the FBI Strategic Plan, 1998–2003: Keeping Tomorrow Safe in May, 1998. The plan, seven months in the making under the leadership of Deputy Director Robert “Bear” Bryant, Included the strategic goal to “prevent, disrupt, and defeat terrorist organi-

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zations operations before they occur.” It pointed to the imperative for the Bureau to boost its performance and intelligence collection and analysis, threat prioritization, S&T, IT systems and applications in collaboration with other US government agencies and with state and local partners (National Commission, 2004. p.76).

Throughout the 10-year period leading up to 9/11, the FBI continued to serve as the lead agency in the United States when dealing with emerging terrorist threats and the rapidly escalat- ing threats to US industry. The FBI was also expected to take the lead in combating new crimes that had emerged as national priorities, ranging from healthcare fraud to street gangs. Bureau management and staff recognized internally that they still had the most important law enforcement mission in the United States, but they were not equipped to successfully address the very difficult questions about the future of the FBI.

Linda Pagelson: Leadership Actions that Set the Stage

The crossroads that the FBI was facing in the mid-1990’s pre- sented a fundamental choice that would determine the FBI’s fu- ture role in US law enforcement and national security matters. The scope of the changes that were required is best reflected in an update to the 1998 Strategic Plan, issued shortly after the 9/11 terrorist attack:

Changes are occurring from top to bottom—from reas- signing personnel to counterterrorism, to examining our hiring practices, to rethinking the scope and form of inter- nal and external information sharing. FBI Headquarters has been restructured to make it more effective and effi- cient. We have centralized case management; realigned the workforce to address our priorities; and developed a central body of knowledge available to all field offices and to our partners in the Law Enforcement and Intelligence Communities (Federal Bureau of Investigation, p. 1)

To address the needed changes in 1998, an internal task force that facilitated the development of this very unique plan was co-chaired by FBI Budget Officer Linda Pagelson. Pagelson,

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was at that time a 20 year veteran of the FBI and Department of Justice. It was her job to fully explain and put the best face on the series of FBI mishaps of the era to the oversight entities in the administration and Congress, which had become highly critical of the Bureau and its performance.

Pagelson concluded that she could no longer submit a credi- ble budget on behalf of the FBI unless is was derived from a com- pelling strategic plan that both explained the string of crises and provided a clear future direction. She strongly advocated for an FBI strategic planning process that could be used to engage the community through the Department of Justice budget process.

At the time, there was little interest in such things at FBI headquarters. The scandals and the appointment of Louis Freeh as FBI Director had reinforced the need to maintain a decentral- ized approach to FBI management. The executive ranks contin- ued the practice of a “revolving door” appointment at the highest echelons of the Bureau; a practice that greatly benefited their post-bureau employment. Between 1994 and 1996, the Bureau saw four different people become the deputy director (the chief operating officer), in tenures that lasted just a few months. The lack of any stability or certainty at the top made it virtually im- possible for the FBI to consider strategic, or long-term solutions for anything.

But Pagelson was not to be deterred. She believed that the FBI had an ethical responsibility to address its critical vulnera- bilities and work to provide solutions. If the FBI’s leaders could not do it, she would take the initiative on her own authority and in her own domain. She decided to include a strategic initiative section in the budget for each FBI program that would fully ad- dress threats and emerging concerns, current performance, and would request funding for strategic initiatives that would ad- dress both the concerns and performance issues. Her view was that if she could encourage each FBI program in the FBI budget to address high impact strategic priorities, and include cost and performance data, the FBI would be well along the way to hav- ing a strategic plan.

To accomplish this without the engagement of FBI senior management was quite a daunting task. But again, relying on her authority as budget officer, she hired a strategic planning consultant, (the author), who was well known to many FBI ex- ecutives, DOJ officials, and congressional staff to assist in the

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design of the new-look budget and to personally meet with each FBI senior executive to discuss the range of initiatives to be con- sidered.

Pagelson’s leadership strategy worked to perfection. The FBI’s 1996 budget was redesigned to reflect FBI strategic priori- ties rather than the traditional budget categories (decision units) and it was very well received by oversight staff at DOJ, OMB, and both the Authorization and Appropriations Committees in the Congress. Nearly all of the initiatives were funded and the process began to awaken several key individuals in leadership positions to the immediate benefits and long-term possibilities associated with a formal strategic planning process.

Throughout her career, Linda Pagelson emphasized her com- mitment to act consistent with the highest level of public ser- vice. Doing the right thing often led her to disagree with her seniors when they chose the path of compromise or acquiescence or when they were unwilling to challenge or question authority. In this process, she became widely recognized as a leader with a commitment to use all of her talents and assets to ensure that FBI policy reflected the highest standard of public service eth- ics. Her actions alone laid the groundwork for a new generation of FBI leaders to rise to the challenge and engage in one of the most transformational strategic planning processes ever under- taken by a large, complex federal agency.

Linda Pagelson’s approach included meeting with each FBI program manager and staff to discuss the strategic initiative project. One such meeting was with the soon-to-be FBI Deputy Director Robert “Bear” Bryant, who was so intrigued by the idea of instituting a proactive approach to the post-Cold War envi- ronment that he decided to personally lead and direct the effort

Robert “Bear” Bryant: The New Paradigm

Louis Freeh became the FBI Director in 1993 and promised to address the immediate leadership problems facing the FBI. After going through three deputy directors in the previous two years, Freeh selected Robert “Bear” Bryant to be his Deputy and was designated as the person who would lead the internal planning and transformation of the FBI.

Bryant had a long and notable career as a criminal investi- gator and field manager, but he admittedly had minimal expe-

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rience and expertise in developing national strategy. He often referred to himself as “a great leader, but a dreadful manager.” Bryant nonetheless immediately surrounded himself with expe- rienced and skilled people who had served outside the FBI, mak- ing him the first FBI executive to have a personal staff that did not consist primarily of FBI Special Agents. Rather, his extended staff consisted of individuals from the CIA, the Department of Justice, universities, and consulting firms, most of whom became employees of the FBI, were detailed from other agencies, or were contractors. He used these individuals as an official advisory group; meeting with them several times a week (both at FBI headquarters and privately after work). This enabled Bryant to coalesce his thoughts first before revealing his vision to the FBI workforce. Bryant declared that the nation was more dependent than ever on a strong FBI to secure its future, so failure was not an option. Consider the following excerpts from a 2014 video interview:

The complexity of criminal organizations operating do- mestically and internationally, and their ability to use modern technology such as electronic transferring of money, the Internet, global transportation, computeriza- tion of all facets of their activities, made successful inves- tigations of these groups extremely difficult….

This changing situation presented the FBI with two challenges: 1) How to sustain/improve the current level of performance in the face of changing conditions; and, 2) How to prevent diversion of resources in an era when highly visible criminal activity, such as bombings, hos- tage taking, and kidnappings often require immediate responses…

In a constantly changing environment, the best plan- ning approach is one that builds upon our core values. In this regard, I wanted to strongly assert the FBI’s role as the leading federal law enforcement agency in coor- dinating a nation-wide assault on foreign and domestic threats to American institutions and to the security of the American people. We needed to develop a national in- frastructure that will greatly enhance the performance of other federal agencies, as well as state and local law

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enforcement organizations. Only in this way can the FBI significantly enhance the available resources and elimi- nate terrorism, organized crime, drug trafficking, violent crimes, and the emerging specter of technology related crimes as a serious threat to the American people.1

Bryant widely circulated his vision statement, which reflect- ed and elaborated on these sentiments, and began immediate- ly to engage senior managers both inside and outside the FBI, seeking advice and partnerships.

Planning Process Outcomes

The FBI, like most agencies had previously made fragmented and ill-fated attempts to develop strategic plans. Instead of pro- ducing a dynamic strategy, past FBI efforts resulted in volumes of documents and forms that focused on ongoing activities and projected modest increases in levels of effort, investigations, ar- rests, and other workload activities—none of which were seen as addressing the significant emerging threats. In announcing his vision to the FBI workforce, Bryant declared that “there was a new sheriff in town” and that this time, planning would be dif- ferent. Bryant declared it his personal priority to:

• establish FBI headquarters as the central authority and require FBI field offices to support the program priorities put forth by FBI headquarters;

• convert FBI programs from their historical reactive posture, where catching the criminal after-the-fact was the essence of the job—to a proactive posture in which preventing the crime from occurring would be- come the purpose of FBI programs such as terrorism, espionage, child abduction, healthcare fraud, cyber- crime, and organized criminal enterprise;

12014 Video interview with the author.

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• collaborate with other federal agencies at an unprece- dented level in areas of mutual concern, such as drug trafficking, white-collar crime, financial crimes, and cybercrime. This was an unprecedented step that challenged deep cultural values of the FBI;

• establish formal FBI presence in more than 60 coun- tries, providing liaison services and intelligence on matters of concern to the FBI;

• create a cadre of intelligence analysts who were in- dependent of the special agent workforce and could provide first rate analytical judgments on investiga- tive matters;

• completely transform the technology, record-keeping, and case filing system on an enterprise-wide basis— despite the fact that the FBI had no enterprise-wide systems in practice at that time.1

Early on Bryant created an executive planning team that reported directly to him. Rather than staff the team with his senior officers, he selected younger officers who were just emerg- ing in the organization, reasoning that they would inherit the management of the Bureau in a few years and that they were building their own organization. He empowered them to address any issue, access any information, and to talk candidly with any senior official. The team met three times a week throughout the course of the project.

Bryant directed the planning team to meet separately with every program in the FBI, both at FBI Headquarters and the major field offices. The sessions were a combination of in-depth assessments, progress reviews, and strategy discussions. Bryant tried to kick off each of the meetings and attend the closeout sessions, exchanging candid thoughts with all participants and asking for their opinions. The sessions, which included all oper- ational, administrative, and technical programs, were very well attended and extremely well received by the workforce.

Strategic Initiatives

The strategic plan ultimately contained across-the-board ini- tiatives that would drive the FBI headquarter’s programmatic

12014 Video interview with the author.

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activities, the most compelling of which was the development of a prioritization mechanism that would enable the 56 field of- fices to better manage conflicting demands associated with the 267 federal statutes that the FBI was required to enforce. At the onset of the strategic planning process, Bryant was aware of the need to capture the enthusiasm of the senior executives of the FBI. As such, he instructed his planning staff to spend in- tense time with all senior managers to determine (a) the extent of their skepticism; (b) their level of confidence; (c) and to solicit any ideas that would get them excited about the project and en- couraged their full engagement.

A senior FBI official who was highly skeptical that the stra- tegic planning could work in the FBI summarized his concerns by stating that continual changes in priorities that were thrust upon the FBI externally (e.g., the attorney general, the presi- dent, and Congress) had created a “flavor-of-the-month” environ- ment in which significant swings in effort and resources could be allocated from among programs as diverse as counterintelli- gence, gangs, drug trafficking, fraud, and even crimes on Indian Country—all on a weekly basis. He saw no indication that the situation would change, and that neither Bob Bryant or any FBI director could address these external mandates in a rational way. The executive did say, however, that if these concerns could be addressed, he would become an avid supporter. But he re- mained a skeptic.

The strategic planning team immediately accepted this chal- lenge and crafted a prioritization scheme that would fit the nu- anced requirements of this complex agency. As opposed to the current situation of having no formal priorities, the team rec- ommended that the Bureau adopt a three tiered prioritization scheme which would cover all FBI responsibilities in hierarchi- cal order. The concept was simple: the first tier would include programs and responsibilities in which the FBI had exclusive jurisdiction and in which the country was highly dependent on high quality work. This tier covered programs such as terror- ism, espionage, and certain categories of white-collar crime and fraud.

The second tier included programs and responsibilities that reflected the FBI’s presumed core competence. Areas such as organized crime, drug trafficking, kidnapping, embezzlement, and witness tampering, were expected to be fully addressed. The

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third tier included programs in which the FBI was largely in support of other agencies and or state and local law enforcement and in which their assistance was discretionary. Programs in this tier were to receive FBI priority attention only if resources were available at the time.

The three-tiered system was immediately recognized as a substantial improvement by the FBI workforce. Each poten- tial investigation was first evaluated regarding the prioritiza- tion category it fell under, and their resources and investigative effort were allocated accordingly. When Bryant announced the initiative at the FBI Strategic Planning Conference in 1998. It was very well received and resulted in a general acceptance by the workforce and senior management because it addressed and resolved a long-standing and very frustrating bureau-wide prob- lem.

Another initiative that made an immediate impact was the development of a worldwide network of Legal Attaché (LEGAT) offices in approximately 60 countries, a network that proved to be invaluable in the aftermath of 9/11. Similarly, the expansion of the small but effective Joint Terrorism Task Forces (JTTFs) provided an organized structure that involved law enforcement agencies investigating terrorism in every state in the country, leveraging the resources and skills of federal, state law, and local law enforcement against shared investigative targets.

The strategic plan provided for dedicated counterterrorism and intelligence agents and analysts to provide a focused inves- tigative effort on the most serious contemporary operational is- sues. The plan also created a significant management section that addressed long ignored issues of culture and workforce per- formance of the FBI support programs. Each of these initiatives would require a significant change in daily operations, staff ca- pabilities, and management approaches, but each was expected to have a significant operational impact. The Strategic Plan and individual program plans included many new and bold initia- tives for training, financial management, technology manage- ment, human resource management, and in other areas that were seen as limiting performance. It set in motion significant changes in virtually every program of the FBI.

The plan included all of the objectives set forth in the depu- ty director’s vision, and did so in a way that addressed many of the obstacles and cultural resistance to change. At the time of

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its publication it was considered a huge success by the FBI, the Department of Justice, the White House, and congressional over- sight committees. While noting the implementation issues that followed Bryant’s departure, the Commission indicated that it was the kind of activity that should have taken place throughout the intelligence community (National Commission, p. 367).

Postscript

Deputy Director Bryant’s career in the FBI and his tenure as deputy director ended shortly after the publication of the FBI Strategic Plan. Recognizing the importance of following through for the next several years, Bryant personally assigned new lead- ership to all critical FBI programs before he left the Bureau. Building upon the success of the strategic planning team he as- sembled earlier, Bryant assigned each member of his task force to a position that would be responsible for leading the implemen- tation of the strategic plan—in areas like financial management, training, IT, and the strategic planning office itself. He named one of the committee participants as his replacement as deputy director and received a pledge to continue the effort indefinite- ly. Bryant left the FBI in 1999 with high hopes of a legacy that would sustain the FBI into the next century.

Within two years, much of Bryant’s plan had fallen into dis- use. In the immediate aftermath of Bryant’s departure from the FBI, four of the crucial staff appointments who were intent upon sustaining the planning process were unceremoniously removed from their jobs. Each of these individuals was replaced by some- one from the “old school” who resumed the previous practices— as if the plan was never developed.

Much of what Bryant wanted to do was to prepare the FBI for the challenges that would present themselves with the in- creasing likelihood of a terrorist attack. Bryant did so by creat- ing a counter-terrorism division and staffing it with young ex- perts in this emerging field and giving them authority to conduct a worldwide program. Before his departure, Bryant ensured that the new Counterterrorism Division would have programmatic authority over all 56 FBI field offices and report directly to the deputy director. He also urged the first FBI assistant director for counterterrorism to begin his own program strategy so as to pro-

171Ethical Leadership and the Transformation of the FBI

vide the FBI with a unique proactive effort intended to ensure that the FBI would dedicate its maximum feasible capacity to the prevention of terrorism.

However, Director Louis Freeh also retired in early 2001, leaving the Bureau without the executive leadership necessary to guide and prioritize the implementation efforts. As a result, in the year leading up to 9/11 there was a significant leadership void in the FBI.

Shortly after the 9/11 terrorist attacks, a new director, Robert Mueller, instituted a new and much more basic FBI strategy that continued and added to the Bryant proactive approach (Federal Bureau of Investigation p.1). By early 2002, the Bryant strategic plan was officially replaced by an updated version that contained many of the same provisions. However, the FBI continued to struggle with its intelligence programs, its record-keeping, and its technology capabilities for most of the next decade.

In reviewing the 1998 Strategic Plan and evaluating both its promise and performance, the 9/11 commission concluded:

A brief synopsis of the period reveals two critical facts to be gleaned about the FBI’s reformist efforts. First, the FBI leadership had impressive insight into its challeng- es before 9/11 and developed a visionary strategic plan in the late 1990s to address them. Second, it did not implement its own well-crafted plan to change the way it was doing business in the face of a growing terrorist threat. Anecdotal testimony indicates that the plan lost momentum for a variety of reasons, including compet- ing pressures on leadership, DOJ reluctance to buy into the growing counterterrorism mission, the inattention of Congressional oversight, and the inherent difficulty of moving a field office-dominated bureaucracy. Whatever the cause of the plan’s demise, the lesson of history is that the FBI and the United States would have been well served by its implementation. (footnote)

In 2005, the Inspector General of the US Department of Justice completed its review of FBI preparedness prior to 9/11 and concluded the following:

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The 9/11 Commission’s report made a number of obser- vations about the role of intelligence in the FBI and its intelligence capabilities. One of its primary observations concerned the potential the FBI’s 1998 strategic plan to reshape the way the FBI addressed terrorism cases. The FBI’s 1998 strategic plan shifted the FBI’s priorities and mandated a stronger intelligence collection effort. The plan also called for a new information technology system to aid in the collection, analysis, and dissemination of intelligence and other information.

The FBI’s strategic plan was based on the FBI’s creating a professional analytical corp. The 9/11 Commission found that if the FBI had fully implemented the 1998 strategic plan, it would have made “a major step toward addressing terrorism system- atically, rather than as individual unrelated cases.” However, the Commission found that the plan was not successfully imple- mented.

The FBI attempted several reform efforts aimed at strength- ening its ability to prevent such attacks, but these reform efforts failed to implement organization-wide institutional change. On September 11, 2001, the FBI was limited in several areas crit- ical to an effective preventive counterterrorism strategy. Those working counterterrorism matters did so despite limited intelli- gence collection and strategic analysis capabilities, a limited ca- pacity to share information both internally and externally, and insufficient training (National Commission, p. 13).

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Questions to Ponder

1. List three things that Deputy Director Robert Bryant did well in developing the FBI strategy. Explain why you thought these were positive.

2. Do you agree with Deputy Director Bryant’s use of non-FBI personnel to serve as his primary and closest advisors in the development of the strategic plan? Explain why you would or would not do the same thing.

3. Do you believe that the process used by Deputy Director Bryant was effective in the long term for the FBI? Would the process have worked well in a “typical” public organi- zation?

4. What could Deputy Director Bryant have done differently to ensure a more effective succession plan for something as important as this project was to him?

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FBI Counterterrorism: Dale Watson and Maximum Feasible Capacity

Bob Bryant’s overriding strategic clarity was to provide the FBI with the agenda and the capabilities to address emerging threats to the nation while retaining leadership of the law enforcement and intelligence communities. In addition to developing the stra- tegic initiatives discussed above, Bryant made a concerted effort to handpick young FBI agents who were just entering the prime of their careers and placing them in positions that would ensure their ascension to leadership. Dale Watson was Bryant’s hand- picked choice to establish and lead the FBI’s new counterterror- ism division.

Dale Watson was a 15-year veteran of the FBI’s national se- curity programs. In 1995 he was assigned to the CIA to assist in the establishment of the first joint FBI/CIA counterterrorism center. This was a program that attempted to model collabora- tion among the agencies that shared jurisdictions. During these years he distinguished himself not only within the CIA, but among the national security community, for his quick and deci- sive action as well as a sense of accountability. It soon became clear that with the approval of the strategic plan and the es- tablishment of the Counterterrorism Division, that Dale Watson was going to be asked to be the first leader of this new program.

Prior to the establishment of the new division, the counter- terrorism program was a section in the FBI’s National Security Division, one of several operations that was placed under the oversight of a single head of National Security. National security programs, especially after the breakup of the Soviet Union, were vastly reduced in staffing. Their operations were focused on in- dividual investigations and the intelligence that could be drawn from them. The Division was expected to provide support for the rest of the Intelligence Community as was needed. Its operations were highly reactive and, aside from some significant espionage investigations, consisted of long-term intelligence collection and reporting activities that were not generally considered relevant by the overwhelming majority of the FBI workforce.

It was often the case that resources allocated to a field of- fice for a national security intelligence project were diverted to low-level criminal activities which, though of little national im- portance, required quick and decisive action from a field office.

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During Watson’s initial months as assistant director of coun- terterrorism, he devoted most of his time to developing and staff- ing the new division and attending various high-level briefings at the various agencies involved in the government’s counter- terrorism mission. As he described it, he had a very big job with very small duties

Three cataclysmic events changed the worldwide counterter- rorism situation dramatically and provided Dale Watson with the opportunity to assume a national leadership role. In August 1998, American embassies in East Africa (Kenya and Tanzania) were attacked by terrorists, resulting in the deaths of over 200 people and representing the worst terrorist incident against the United States to date. In the immediate aftermath of the investi- gation, it was clear that terrorist organizations led by Osama bin Laden carefully planned the event and the continuing assault against the United States and the Western allies.

Watson commented to many people afterwards about how helpless he felt “cleaning up” the aftermath of a devastating attack. Far better to put things in place that would have pre- vented such an attack. Just a few months later, the USS Cole was bombed as it was refueling in the Gulf of Yemen, killing 17 United States sailors. In both cases, the FBI responded to the crime scene, conducted an investigation, analyzed intelligence and pursued the perpetrators.

When Watson returned to Washington DC, he sought coun- sel from many of his closest advisors concerning possible ways of realizing the goals of the 1998 Strategic Plan by developing very specific approaches to implement a proactive or preventa- tive strategy. His advisors reviewed deterrence models had been put in place by the US military during the Cold War as well as certain crime prevention strategies that have been successful in the past. Watson was clear that the FBI did not need a complex academically focused strategy or a traditional government-look- ing strategic plan. Rather, he envisioned something like Bryant’s tiered approach, that was well received by the workforce, was clear, easy to grasp by professionals, and could be implement- ed quickly. What ensued from these discussions was a strategy that would forever change the approach of national security pro- grams for the FBI and the US Intelligence Community.

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By the summer of 2001, Watson was convinced that a terror- ist attack against the US was imminent. He warned a conference on terrorism that was held in Washington DC in July, 2001 of the likelihood of a terrorist attack inside the United States and he was concerned by the lack of strong support from either the White House or the Department of Justice—which had down- played the terrorist threat earlier in the year when the FBI was denied any funding for it counterterrorism efforts.1

In hindsight, the strategy development process was rela- tively simple though its consequences were enormous. Watson asked his team to imagine that a terrorist plot was prevented by a well-managed FBI field office. What are the specific elements that would have had to be in place—and the level of performance required for each of those elements—to prevent the threat from manifesting. Watson’s Strategic Planning Team identified five key attributes that each office must have in place and the per- formance expectations associated with each of them. The five at- tributes were:

1) An experienced and effective investigative capability;

2) An intelligence capability that identifies all relevant information in the possession of the FBI identified in- telligence information that was otherwise unknown;

3) Effective processes of information sharing, commu- nication and dissemination among the various FBI field offices and FBI Headquarters, both in classified and unclassified information;

4) Outstanding and ongoing relationships with state and local counterparts; and

5) A program management capability at FBIHQ that provided appropriate targets, relevant information, the allocation and reallocation of resources, and ef- fective problem-solving on an as-needed basis.

The participants in this planning effort came to the conclu- sion that if every FBI office was highly functioning in each of these areas, not much more could be asked of them, and they

1Excerpt of Dale Watson’s testimony before the 9/11 Commission Report, cited in History Commons Alert, http://www.historycommons.org/searchResults.jsp?search- text=Watson&events=on&entities=on&articles=on&topics=on&timelines=on&proj- ects=on&titles=on&descriptions=on&dosearch=on&search=Go

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would be doing everything humanly possible to prevent ter- rorism in their domain. This was a key component for Watson, because it acknowledged that the overriding goal of preventing terrorism at all times and under all circumstances is probably not attainable, given the worldwide antagonisms and cultural predispositions to commit terrorist acts. But what should be expected of the FBI is that they provide a maximum feasible capability in every field office and in every area where the FBI is expected to protect US interests and American citizens. This became the FBI’s terrorist prevention strategy, otherwise known as MAXCAP05 (National Commission, p. 77).

The strategy provided not only the identification of the key attributes, but also paved the way the for the leadership of each FBI office to assess its performance and capabilities against those standards. For example, investigations had to be fully staffed, progress reported, and relate to major FBI concerns. Intelligence activities must include information exchanges that enlightened investigators, as well as an ability to collect, review, and dis- seminate all relevant information. Communication meant that all relevant information known by one organization in the FBI should be disseminated in a way so that it was common knowl- edge throughout the Bureau, and on a timely basis. State and local liaison meant that informal and ongoing interaction result- ed in the exchange of vital case information which was routine in every field office. Finally, program management meant that each office was in constant communication with FBI headquar- ters concerning its priorities, investigations, needs, and that FBI headquarters was advising, redirecting, and closely monitoring the terrorism program in each of the 56 offices. It soon became clear that the majority of the FBI was not performing at maxi- mum feasible capacity. All of these are proactive measures that are not generally undertaken and sustained unless driven by the interest and engagement of a strong leader.

Disinterest The excitement that was being generated within the FBI and other agencies in the US Intelligence community was not shared by all members of the executive branch in the months before the terrorist attacks on 9/11. The year 2001 had begun with a new administration taking power. George W. Bush had campaigned for president with the promise to focus more on the domestic issues facing federal law enforcement, thus down- playing the terrorist threat.

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The full impact of the Administration’s change in priorities came to a head in the spring of 2001 with the publications of the US Department of Justice’s guidance for the development of the annual budget. In a memorandum signed by Attorney General John Ashcroft and Deputy Attorney General Robert Muller, DOJ priorities were set forth in a manner that stunned the leader- ship of the FBI. The DOJ budget guidance identified the bat- tle against guns and drugs, and the advancement of civil rights to be among the top priority items that were supported by the administration in that year’s budget process. Counterterrorism, which was widely acknowledged as an underfunded activity, did not make DOJ’s top 10 list of urgent priorities, causing a rather significant dispute among senior DOJ officials, including lead- ership of the FBI. This ill-considered decision ultimately pre- vented the FBI from requesting any additional counterterrorism resources on the eve of the 9/11 attacks. This action surprised many observers and has never been fully explained (National Commission, p. 209).

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Implementation. Having gone through the final stages of the 1998 strategic planning process, Watson was determined to sus- tain the strategy for several years and not repeat the experi- ence of Bob Bryant—whose implementation team was dissolved a few weeks after his departure. As a separate process, Watson asked his strategic planning team to develop an implementa- tion strategy that was designed to maintain the enthusiasm and the high-minded purpose of the counterterrorism strategy docu- ment. Several steps were identified that reflected the strengths of his leadership position and his commitment to achieving the result.

Advisory Board. Recognizing that his plan would be accepted only to the extent it was considered legitimate, and understand- ing the role that leadership plays in motivating the workforce, Watson established a Counter Terrorism Advisory Board that was made up of the senior FBI executives running the most sig- nificant FBI offices throughout the country.

Collectively, this group had enormous power within the FBI. It included the heads of some of the major FBI Field Offices (Miami, Chicago, Dallas, San Francisco), most of whom are well-

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versed in criminal investigations and would be able to ensure that the strategy was relevant to the 75% of the workforce who were not involved in national security matters. Watson vetted the strategy with the Advisory Board over several meetings and got full concurrence and strong support for the collaboration he demonstrated. From that point on, the Advisory Board was among his most significant allies.

Regional Meetings. Each of the members of the Advisory Board volunteered to host a regional meeting throughout the summer of 2001 in which the new counterterrorism strategy could be presented and thoroughly discussed with FBI field managers from each of the FBI’s 56 field offices. This was a very important undertaking because rather than bringing the field office heads to Washington DC, where discussions are somewhat formal and comments somewhat restrained, the meetings were hosted at locations selected by the host Advisory Board Member, and conducted in an informal and relaxed setting.

During the sessions, Watson was able to solidify his leader- ship role by presenting the nature of the threat as he understood it, the logic of the strategy and a discussion of the model as a proactive approach to preventing terrorism. Watson also laid out his expectations for the strategy and performance of each FBI field office. The sessions were very well received in each part of the country. The sessions also solidified Watson’s reputation as the leader of the counterterrorism program in the FBI as well as a forward-looking leader of the US Intelligence Community.

Self Assessments. The field office briefings also included a de- scription of the process for assessment and review that was going to be recommended for all FBI field offices. The Advisory Board endorsed a process of assessment and review that was known as the AFOR (Automated Field Office Report) which was the perfor- mance assessment process organized around the five key attri- butes of the MAXCAP strategy. Building upon the strategy, the AFOR delineated as many as 10 individual performance criteria that would be reviewed in order to make an overall assessment on the main category. Thus, the category “Intelligence,” was fur- ther delineated by including subcategories such as breadth of the collection process, quality of analytical work, backlogs in translation material, and utility of intelligence products.

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This process was distinguished from earlier efforts of plan- ning and performance monitoring because the assessments were carried out by the local field office and submitted to senior man- agement in the field office. No external entity was involved in making determinations about the overall capabilities of an indi- vidual office. Watson believed that given the severity of the ter- rorist threat, FBI agents are more than qualified to determine the vulnerability. Moreover, he viewed it as a test of their ethical commitment to the FBI mission that they would make these as- sessments frankly and in all candor. From all contemporary ac- counts, the AFORs were completed in good faith and submitted to the Counterterrorism Division at FBI Headquarters for com- pilation. The data that was provided through this process was of enormous value in identifying and overcoming vulnerabilities throughout the system.

National Conference. Prior to assigning the AFOR to FBI field offices in 2001, Watson decided to have one more leadership event to reinforce the building momentum of the counterter- rorism program. In January, 2001, Watson held a national con- ference in which every counterterrorism supervisor from every FBI office was invited to come to Tampa, Florida to be present- ed with the strategy, and engage in a workshop in which they practice completing the AFOR. Invitees to the conference includ- ed Attorney General Janet Reno, and the president’s National Security Advisor, Richard Clark.

The conference included 250 FBI agent/supervisors as well as senior management from each of the 56 offices, the DOJ and White House personnel. The day-long session outlined the strategy, included the personal estimates of the Department of Justice and the White House, and ended with a three-hour working group session in which each office was able to review their performance in light of the new MAXCAP strategy. The conference itself was seen as a significant leadership event as it involved the entire counterterrorism workforce, and engaged se- nior officials from the US government in recognition of the FBI’s (and Watson’s) leadership role on this area.

Director’s Report. Perhaps Watson’s most noteworthy initia- tive was a highly classified document known as the Director’s Report. The Director’s Report was a compilation and high-level

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summary of the AFOR submissions from each of the FBI field of- fices. It identified, on an office-by-office basis, the strengths and vulnerabilities of each, as well as the individual threats posed by both domestic and international terrorist groups in each part of the country. The Director’s Report did not paint a flattering picture of the FBI’s state of readiness just before 9/11. The in- ternal assessment, one of the bureau’s most closely held docu- ments, found virtually every major FBI field office undermanned in evaluating and dealing with the threat posed by groups like Al Qaeda (National Commission, p. 78).

Interestingly, Watson’s leadership had encouraged the coun- terterrorism supervisors throughout the FBI to create a candid report that highlighted vulnerabilities and capabilities in the various programs and regions. No document of its kind had ever been prepared within the FBI before, and it was only accom- plished because Watson assured the workforce that no sanctions would be levied on any office that produced a candid self-assess- ment. In fact, he told them that a candid and insightful self-as- sessment, given the extreme nature of the threat, was likely to result in increased resources for that office. This also was an unprecedented leadership position that solidified Watson’s repu- tation for having the moral courage to do the right thing. His ac- tions demonstrated the commitment to see things through and take the steps necessary to ensure system-wide accountability.

PostScript

The Director’s Report completed the strategy development cy- cle for the FBI counterterrorism program and for its Assistant Director Dale Watson. The document became the basis for the FBI’s 2001 budget, because it identified significant vulner- abilities and specific initiatives to address them. Incredibly, the Department of Justice and the White House denied all re- quests for new resources to fill the gaping holes identified by the Director’s Report (The 9/11 Commission Report). While there are various theories that explain this otherwise incomprehen- sible decision, the budget that was based on the director’s re- port was resubmitted the week after 9/11, and FBI was provided with 100% of its resource request. But it became known as “the President’s 9/11 budget request” and the White House and DOJ

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officials, who had strongly opposed the funding request just two weeks earlier, were given full credit for the initiative. The con- trast in leadership styles was clear.

The process of self-assessment began to be utilized by other national security programs in the FBI. New FBI Director Robert Muller promoted Dale Watson to a new position as the execu- tive assistant director (EAD) for all FBI national security pro- grams. Among his first act in his new position, Watson directed the FBI’s Counterintelligence and its Intelligence Division to undergo a process similar to what he had just been performed by the Counterterrorism Division. The leaders of those two pro- grams followed the script to near perfection and developed very dynamic strategies that effectively rebuilt and redirected those programs and elevated their performance significantly.

Within the next three years the self-assessment methodology successfully transformed the FBI’s national security programs and began to be adopted by other US Intelligence Community agencies.

183Ethical Leadership and the Transformation of the FBI

Questions to Ponder

1. Why do you think Watson was one of the few FBI managers who felt strongly about the terrorist threat?

2. Which of the various management actions he initiative do you believe had the most impact? Why?

3. Would your agency ever produce a document similar to the Directors report -which identifies all sensitive concerns and problems? How would it be received?

4. Can you understand why today—nearly 20 years after 9/11—Dale Watson is still considered one of the most trusted members of the FBI?

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Dave Brant: NCIS Transformation and National Leadership

Throughout much of its history, NCIS was regarded as a mid-lev- el but effective law-enforcement organization that provided in- vestigative support and related services to the US Navy and its leadership. Its role was primarily to provide protection and secu- rity to US Naval ships, installations, and assets while maintain- ing an investigative presence throughout the world. The NCIS workforce resembles the workforce of most law-enforcement organizations in that it viewed its primary responsibility as conducting investigations of crimes and/or suspicious activities within its jurisdiction. This reactive capability served the Navy well for many years as NCIS took its place along with the Office of Special Investigations (OSI) in the Air Force and the Criminal Investigative Command (CID) of the Army to form a triad of in- vestigative agencies serving the DOD.

The bombing of the USS Cole set in motion forces that changed forever the position of NCIS. On the morning of October 12, 2000, while docked in the Gulf of Aden for refueling, two indi- viduals in a small fishing vessel were able to approach the ship and detonate a bomb that blew a 40-by-40-foot hole in the port side of the ship, creating a hole that disabled the ship and killed 17 US Navy sailors, and injured 39 others.

That two people in a small fishing vessel could complete an attack of such magnitude against a US Navy war ship was un- fathomable to the Navy command and the national security and intelligence communities. In the investigations that followed, a wide range of issues were identified that contributed to the trag- edy—intelligence failures, security lapses, and a false sense of confidence about the invulnerability of Naval war ships in for- eign ports. But most important, the bombing of the USS Cole did much to clarify the capability of international terrorist organi- zations, specifically Al-Qaeda and its network, as well as their unrelenting intent to engage in terrorist activities that were pre- viously unimaginable.

185David Brant: NCIS Transformation and National Leadership

NCIS Response: Situational Leadership

The bombing of the USS Cole mobilized the national security and intelligence communities to identify and bring to justice the perpetrators. Despite a hostile host country environment, NCIS agents worked closely with the FBI in the ensuing investigation and were successful in identifying the perpetrators, the plan, the support networks, and the intelligence gaps within a very short time. As has typically been true, the reactive capacity of American investigative agencies is of the highest quality, and with the support of NCIS, the FBI completed its post-event work with a very high level of efficiency and effectiveness.

However, for many, the bombing of the USS Cole served to convey a clear warning that the world had indeed changed. The hopes of a peace dividend that was envisioned with the ending of the Cold War just a few years earlier were overtaken by a grow- ing awareness of a new and very different asymmetrical threat that presented a significant challenge to US military and law enforcement organizations. NCIS Director Dave Brant was one of several who began to understand that these very real threats could not be addressed effectively with the existing operational approach, resource base, technological capabilities, or the overall infrastructure of his agency. As he reviewed the NCIS mission, he began to realize that he was leading an organization that was increasingly unable to fulfill its mission expectations quoted below:

The NCIS mission is to investigate and defeat criminal, terrorist, and foreign intelligence threats to the United States Navy and Marine Corps—ashore, afloat, and in cy- berspace.

In the immediate aftermath of the Cole, but far in advance of 9/11, Dave Brant began meeting with his executive staff to ascertain the exact nature of NCIS’s responsibilities to the Navy. The result of those meetings produced a consensus among the NCIS executive staff that they were unclear about their respon- sibilities and unsure of their direction, and they didn’t believe they had the internal capacity to resolve the many issues they were facing

This assessment was consistent with the assessments that were ongoing in many agencies. The emerging terrorist threat

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was unlike anything that had been experienced before and re- quired a different approach to operations,and management, and a significantly different and enhanced capability. The fact that the bombing occurred in NCIS’s area of responsibility and juris- diction made the assessment a matter of great urgency. By the spring of 2001, Dave Brant and the NCIS executive team collec- tively decided that the organization and its operations must be transformed.

As a general rule, agency transformations are driven by ex- ternal mandates that generally accompany new administrations, reorganizations, budget reductions, or the vision of a senior po- litical official. None of these played a part in the NCIS decision to transform itself. For NCIS, these discussions took place within the organization prior to 9/11 and prior to any suggestion or re- direction from senior Navy officials or leaders in the intelligence or national security communities. In short, there was nothing compelling the leadership of NCIS to initiate a comprehensive transformation, except their own views that it was the right thing to do.

Director Brant took the position that the investigative re- sponse to the bombing of the Cole was as good as could be ex- pected given NCIS existing capabilities, but was not satisfactory given the nature of the threat. The investigation identified leads that could have been better followed, relations with the host countries that could have been better managed, security that could have been better deployed, as well as a resource allocation that could have been more responsive to the nature of the threat in the region.

This led Director Brant and the NCIS executive staff to unanimously assert that their post-Cole response must be clear- ly proactive and reflect the NCIS’s commitment to do everything possible to prevent similar attacks in the future.

This required a dramatic change in posture from a highly efficient reactive capability, to a forward-looking and proactive approach to management that sought to better understand the nature of the threat, and to align resources and develop pro- grams that were intended to prevent adversaries from gaining a strategic advantage.

187David Brant: NCIS Transformation and National Leadership

The key to understanding the significance of Dave Brant’s leadership and role in the transformation and creation of the modern NCIS is that this entire dialogue took place before the terrorist attacks of September 11, 2001. By signaling to the entire workforce that the NCIS executive leadership was committed to a new proactive posture that would significantly change every aspect of the organization, Brant began the NCIS modernization agenda before the 9/11 terrorist attacks and was in full imple- mentation mode as others were just beginning to understand the scope of the change they would be asked to undergo. By early 2003, NCIS had developed its new forward-looking strategy, was completing its organizational restructure, had initiated its mod- ernization plans, and was well on its way towards a redefinition and transformation.

Brant’s Four leadership Initiatives

In reflecting on his career, Dave Brant identified four distinct leadership initiatives that he undertook in response to the new strategic positioning of NCIS, and indicated that all four played a significant role in what has defined his leadership. First, in recognition of NCIS’s limited internal capabilities, he sought to avail himself of a wide range of outside experts whose advice he relied upon and whose recommendations he accepted. Sec- ond, he committed the entire agency to a top-to-bottom strategic planning and modernization effort to ensure that the organi- zation, the infrastructure, the resource base, and the technol- ogy capabilities were to become consistent with the emerging requirements of a proactive, forward-looking investigative and intelligence agency. Third, he personally drove the establish- ment of strategic initiatives and special projects that demon- strated NCIS’s commitment to collaboration within the law-en- forcement and intelligence community, and to take the lead in developing new initiatives that supported increasing demands for collaboration, information sharing, and quality intelligence. Fourth, Brant chose to demonstrate his personal leadership in a variety of areas that reinforced the high-minded purpose and ethical foundation of NCIS, thereby further communicating the commitment of the agency to public service rather than personal achievements. A brief discussion of each of these four leadership initiatives is set forth below.

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Expert Advice. Over the course of a series of executive meetings, seminars, and conferences in the aftermath of the bombing of the USS Cole, the entire NCIS leadership team was in agree- ment that the Agency must make changes to adapt to the cur- rent threat situation. They agreed that they needed to transform their operations and set a new direction. However, they didn’t know where to begin. So Director Brant urged the executive leadership team to start a comprehensive outreach throughout the law enforcement and intelligence community. He also sug- gested contacting academics, consultants, and retired agency of- ficials who could convey a comprehensive, but practical course of action.

Throughout the spring and summer of 2001, the NCIS lead- ership team sought advice from a wide range of individuals and began the formal process of reconsidering the agency’s entire way of conducting business. Ultimately, a small group of outside ex- perts became part of an inner circle who advised Director Brant and worked with the NCIS senior staff to formulate a number of initiatives and strategies. Included in this small group were Scott Gould, former Assistant Secretary of the Treasury, Bob Chairadio, former Executive Assistant Director of the FBI, and Keith Simpkins, a highly regarded technology practitioner.

Brant maintains that the decision to seek outside expertise was among the most crucial decisions of his tenure. Law enforce- ment and intelligence organizations are typically very insular, and have structured career development programs that place a high premium on reserving all positions of strategic and tacti- cal importance and visibility to the core workforce. The NCIS workforce was built around special agents who possess signifi- cant investigative and analytical skills, but generally have not been trained in advanced management, budgeting, or strategy development.

Quite often, the workforce of investigative agencies is so in- sular that outsiders, no matter their expertise, are not a good fit and are not typically permitted to participate in confidential discussions with the director. Brant’s decision to rely on outsid- ers who often presented views that were opposed by NCIS senior staff was a significant departure from practice and caused some disruptions in the organization. Brant strongly maintains that this decision presented NCIS with the widest possible range of

189David Brant: NCIS Transformation and National Leadership

options that ultimately permitted the agency to string together a coherent agenda for the future.

Strategic Planning and Modernization. In November 2001, Director Brant announced his intention to begin a comprehen- sive strategic planning and modernization process, the purpose of which was to clearly communicate the strategic direction of the agency and to identify the full cost of developing the capacity to achieve it. The process produced two primary documents that drove executive activity for the next several years: (1) The NCIS Strategic Direction, and (2) the NCIS Modernization Plan.

Creating the Strategic Direction was a seminal event in the history of the NCIS, and it continues to define the approach to its mission today. The NCIS investigative programs, effective as they were reactive and focused on safeguarding Navy ships and installations, primarily around naval bases in the United States and around the world. NCIS essentially functioned as a staff to Navy leadership and provided law enforcement and security support to the Navy as requested. In this role, they were highly valued by Admirals and senior Navy staff for their responsive- ness and their efficiency.

Brant acknowledged in the kickoff to the strategic planning process that while he understood the value of the existing NCIS program, the current approach did nothing to prevent the bomb- ing of the Cole and would be unlikely to prevent future acts of terrorism. In making those statements he directed the planning team, which was made up of a combination of contractors and his senior staff, to explore an alternative posture that would provide NCIS a framework for developing strategies that would have a significant impact on the safety and security of Naval operations.

Within a few months of meetings, staff sessions, seminars, and interviews, the planning team reported back that the three major NCIS programs could be reformulated by emphasizing a proactive strategy designed to (1) prevent terrorism, (2) protect critical and strategic Navy secrets, and (3) reduce high-impact crime on naval installations. Almost immediately, the concept of “prevent, protect, and reduce” which quickly became known as PPR became the focus and symbol of NCIS strategic develop- ment. This reformulation of NCIS’s major programs permitted Director Brant to personally integrate this dramatic change in

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strategy both within the organization, to his superiors in the Navy and DOD, and externally to the law enforcement and in- telligence communities. It was widely seen as a dramatic break- through because it focused not on investigative processes, but on investigative outcomes.

The PPR strategy was perhaps one of the more noteworthy aspects of Director Brant’s tenure. It caused a reconsideration of virtually every operational component in NCIS and set in mo- tion a planning process that set specific targets for a wide range of activity in NCIS field offices. An agency-wide strategic plan- ning process was created to ensure that all components in the agency work in a cohesive and current manner to ensure the transformation of NCIS’s counterterrorism, counterintelligence, and criminal investigative programs. Moreover the plan provid- ed a framework which enabled support programs to develop pri- orities, by asking the question, “to what extent are our efforts supporting the operational strategies?”

With the development of the PPR strategy, Director Brant then turned to his modernization plan. To give the moderniza- tion plan the legitimacy required for agency transformation, Brant created an internal team which, using the modernization plan for guidance, reviewed every headquarters-based opera- tional and management component and assessed it against its capacity to support the new strategic direction.

Prior to this effort, NCIS had been minimally structured and staffed largely as a service organization. It operated with a sin- gle deputy director, and had staff offices for personnel, budget, and computer services. It had no HR department, CIO, or CFO. NCIS operations consisted primarily of staff offices reviewing investigations, not providing direction.

The result of the team intervention was a dramatic transfor- mation in the NCIS organization, including the establishment an organizational structure with two deputy directors—one for operations and one for management. The Deputy Director for Operations led the new Operations Directorate, which ele- vated the counterterrorism, counterintelligence, and criminal investigation programs to executive-level status each head- ed by in Executive Assistant Director. The Deputy Director for Management headed a directorate that was responsible for ad- ministrative and support programs such as human resources, information technology, financial management, training, and

191David Brant: NCIS Transformation and National Leadership

specifically created new positions for a CIO and CFO. Significant investments were made in the technology base which included the hiring of skilled intelligence analysts and technical staff and the development of an intelligence center known as the Multiple Threat Alert Center (MTAC. The process coincided with a signif- icant increase in the resource base for the agency. By the time of Brant’s retirement in 2006, the entire organization had a new look, a new mission, and was building a new culture.

One of the indicators of an effective strategy is that it is often identified with the person who developed it or at least popular- ized it. Throughout the process, Brant made it clear that the PPR strategy was his strategy. Seldom do strategies developed by committees have lasting impact. By owning the strategy, Brant conveyed to the NCIS workforce the seriousness with which he considered the strategic planning initiative and the priority it was to have.

The NCIS workforce responded enthusiastically. The chain of command up to the Secretary of the Navy became personally engaged and committed to the achievement of the objectives of PPR. In his presentations, Director Brant continually stressed the ethical imperative of NCIS to attain the level of performance that would enable it to better protect the Navy and safeguard its personnel. He emphasized the need for candor and courage in identifying every obstacle and barrier that stood in the way of successful implementation, and he encouraged and rewarded creative solutions to long-standing and intractable problems. To this day, Brant insists that the PPR strategy provided not only the direction but the platform that enabled the NCIS transfor- mation.

Strategic Initiatives: LInX. One of the key elements of the PPR strategy was a commitment to develop and participate in highly visible, high impact initiatives that intended to address many intractable issues, elevate NCIS performance, and demonstrate the leadership’s commitment to the PPR strategy.

During the years 2002 through 2005, each NCIS program sought to align itself with priority initiatives undertaken by the intelligence community and other agencies in the defense, intel- ligence, and law enforcement worlds. For example, along with the CIA and the FBI, NCIS initiated the development of the Office of National Counter Intelligence Executive (NCIX), and

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volunteered senior staff to serve in key management positions for this new coordinating organization. NCIS also worked closely with the FBI to initiate a significantly new approach to counter- intelligence investigations that focused on protecting strategic secrets and critical national assets, rather than on espionage investigations. NCIS was also able to work with Hollywood to created its own network television show, an initiative that has provided significant long-term visibility and recognition.

But perhaps the most significant initiative of the decade was the development, implementation, and expansion of the Law Enforcement Information Exchange, an information sharing pro- gram generally known as LInX. This unique initiative sought to realize the information sharing ideal as set forth in the 9/11 Commission Report which called for an information sharing capacity that would enable all US law enforcement and intelli- gence agencies to have access to one another’s records.

Historically, law enforcement information has been very closely guarded within individual agencies, both at the state and local, and federal level. This prevented law enforcement and in- telligence personnel from having access to critical information on many subjects of shared interest. The reasons for this are many and go beyond the scope of this book. However, suffice it to say, obstacles to information sharing were deeply rooted in both the law enforcement and intelligence cultures and the calls for reform after 9/11 were simply not receiving an effective re- sponse.

Early in 2002, Brant was asked to participate in an FBI pilot project that sought to test the viability of fully integrating in- formation from multiple agencies into a single database, there- by ensuring that all information possessed by the government could be used by any law enforcement agency in the conduct of investigations. The FBI began prototyping the system in St. Louis in 2002. However, technological problems caused the FBI’s information sharing program to be significantly delayed. After discussing the matter with FBI Director Mueller, it was mutu- ally decided that NCIS would assume the lead and develop the project.

The leadership requirements of such a project were daunt- ing. First, information sharing by definition involves multiple organizations, and is not something that can be commanded or ordered. In the LInX project, the primary data to be shared was

193David Brant: NCIS Transformation and National Leadership

the law enforcement records maintained by the various state and local police agencies that worked in the jurisdictions where the US Navy had a strong presence. For example, at the headquar- ters of the Atlantic Fleet in Norfolk Virginia, NCIS would ben- efit significantly from having access to law enforcement infor- mation maintained by the various federal and state/local police agencies in the region. Similarly, Naval facilities in Seattle and San Diego would also benefit from having a single repository of law enforcement information. As it currently stood, the various agencies maintained independent records so that any threat or any suspicious activity had to be checked individually among all the independent record systems of all the agencies in a region. This was the pre-9/11 information sharing problem that NCIS and Brant were trying to address.

Brant was aware that the problem of information sharing was not a technology problem. It was first and foremost a lead- ership problem. And in developing a leadership response, he was able to form a strong alliance with several United States Attorneys who would assist in mobilizing their communities and securing the participation and enthusiastic engagement of the various sheriffs and chiefs of police. John McKay, the former United States Attorney from Seattle Washington, played a lead role and was able to create a model by engaging the Puget Sound law enforcement community in support of the project. Rather than emphasizing technology, Brant authorized the develop- ment of a governance process—a formal governing structure that would permit each of the independent law enforcement agencies to work within a single command, led by the US Attorney and the local NCIS Agent-in-Charge. The Governance Board created the policies, procedures, and practices that would overcome the strong traditional and cultural barriers to information sharing.

While the details of the story are best left for another con- text, suffice it to say that Brant was able to acquire sufficient funding from the Secretary of the Navy to pilot-test the LInX project in Seattle. He was then able to obtain a commitment from the House Appropriations Committee Chairman, who allocated $5 million for the expansion of the project. Brant then worked closely with those US Attorneys whose districts included a sub- stantial Navy presence and created independent LInX projects throughout the country. By the time of his departure from NCIS in 2006, NCIS had initiated and funded model information shar-

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ing projects in eight regions. Throughout the rest of the decade, the LInX project was expanded, and continues to function as the information sharing best practice.

Again, the key to understanding the leadership role played by Dave Brant is the recognition that this significant under- taking—a post-9/11 imperative—was not requested, required, or even encouraged. There would have been no sanctions or ad- verse impact had Brant decided to permit the FBI’s information sharing project to simply atrophy. In fact, there was substantial criticism of him both from within the agency and externally for reaching outside of the NCIS traditional mission. His position then and still today is that there was a compelling need for such a project, it was consistent with his vision and Navy interests, and he was willing to step up and take the lead. No other senior agency official has similarly been identified with this critical is- sue.

Dave Brant was recognized for his outstanding leadership on the information sharing issue. The program extended the good- will afforded to NCIS throughout the law enforcement and in- telligence communities. DOD ultimately adopted the LInX mod- el for its own internal information sharing project and named NCIS as the executive agent, responsible for development and the implementation on a DOD wide basis. The project informed virtually all other information sharing initiatives of the time and is widely acknowledged as one of the most effective. Key to his success was the recognition that the barriers that prevented information sharing and would continue to limit it were leader- ship issues, not technology issues. Without the commitment of the heads of the various law enforcement agencies, there can be no sharing of information. With the commitment, there can be no stopping it.

In the United States today, there over 18,000 independent law enforcement agencies, most of them are headed by an elect- ed official. Brant recognized that coordinating an effort of such magnitude requires a different type of leadership, one character- ized by an ethical imperative and commitment to public service. That was the message he conveyed to his peers that ultimately enabled thousands of law enforcement officials to commit their agencies to the LInX system. Without Dave Brant’s leadership on this issue, it is highly unlikely that any comprehensive infor- mation sharing system would have succeeded.

195David Brant: NCIS Transformation and National Leadership

Personal Leadership: GITMO. A large part of Dave Brant’s popularity as a leader was derived from the positions he took on a variety of issues that related to the care, well-being, and ethical standards of the NCIS workforce. He attempted to un- derstand the problems of individual employees and often put their concerns and needs ahead of agency policy. If an otherwise legitimate reassignment would have significant family impact, Brant would try to find a less disruptive solution. If an approved government policy and practice raised ethical questions, Brant conveyed them to his NCIS executive team who sought to find equitable alternatives. If he believed that official policy crossed definite ethical lines, Brant forcefully registered opposition. This ethical stance, one that recognized the imperative to maintain the highest standards of propriety, had a positive impact on the NCIS workforce and became a indelible part of the NCIS culture.

Perhaps the most notable example occurred shortly after the onset of the Iraq war. As prisoners and detainees were relocated to the naval base at Guantánamo, Cuba, NCIS became part of an interagency team responsible for conducting in-depth inter- rogations of the prisoners. NCIS had a permanent role on the interrogation team, and played a major role in developing the interrogation protocol, with a view of persuading, not coercing the prisoners to cooperate.

As rumors began to circulate of the use of harsh interro- gation techniques, Brant became concerned and asked NCIS personnel to confirm the veracity of these rumors. When they indicated a general agreement that harsh interrogation tech- niques were being employed, Brant personally traveled to Cuba to investigate for himself. After a very short time, he was able to validate the rumors and verify that interrogation techniques being used went far beyond established guidelines. He immedi- ately confronted the commander of the operation and advised him that unless these questionable practices ceased immediate- ly, he would remove all NCIS agents from Guantanamo and end NCIS’s participation in the program. While Brant acknowledged that he himself could be removed for his opposition to the ad- ministration’s policy, he said that would not happen until after the NCIS agents were taken out of the country with much pub- licity. This ultimately led to the reconsideration of the US gov- ernment’s policy on torture. As a result of this confrontation, the

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harsh interrogation techniques were immediately suspended and the policy clarified.

For Dave Brant, this demonstration of moral courage played a major role in greatly enhancing the trust afforded him by the NCIS workforce and solidified his legacy. It underscored his com- mitment to the ethical standard he tried to impart to the NCIS workforce and it engendered the level of trust that characterized his leadership.

Postscript

A key indicator of effective leadership is whether the practices, values, and cultural attributes associated with the leader’s ten- ure can be sustained after the leader’s departure. In the years since Dave Brant’s retirement, NCIS has undergone significant change. Six individuals have served as the permanent or act- ing director during this time, a new administration has intro- duced new policies, and the agency itself has been relocated ap- proximately 50 miles from its location in the Washington Navy Yard to new modern and secure offices on the Marine base in Quantico, Virginia, a move which caused a substantial change in the workforce because of the changing commuting requirements.

Although obvious changes had taken place in the ensuing years, PPR remains the NCIS strategy. It has been woven into the culture of the organization so much so that it is as much a modified mission statement as it is a strategy. But it does provide a framework within which all NCIS programs function. NCIS now views the prevention of terrorism, the protection of secrets and critical assets, and the reduction of high-impact crime on naval installations as its core responsibilities, and regularly de- velops operational and management plans to address contem- porary issues within this framework. Moreover, more than 15 years later, NCIS continue to fund and manage the nation-wide LInX program. Without the leadership of Dave Brant, it is hard to imagine how any of this would have occurred.

These changes notwithstanding, the core elements of the strategy and the NCIS organization that were put in place a decade ago have been institutionalized. The major management functions continue to evolve and NCIS personnel assigned to planning and evaluation, HR, financial management, and IT have matured on their jobs and handle most day to day matters efficiently.

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Questions to Ponder

1. List three things that Director Brant did well in devel- oping the NCIS strategy. Explain why you thought these were positive.

2. Do you agree with Director Brant ’s use of outside advisors to assist in the development of the stra- tegic plan? Explain why you would or would not do the same thing.

3. Do you believe that the slow, methodical process used by Director Brant was effective in the long term for NCIS? Would the process have worked well in a “typical” public organization?

4. What could Director Brant have done differently to ensure a more effective succession plan?

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John McKay: US Attorney as the Chief Law Enforcement Officer

Serving as a United States Attorney is a unique experience. US attorneys are assigned to one of the 94 federal judicial districts in the United States, serving as the senior federal official in the district. Many consider a US attorney to be the equivalent in stature and in function o that of an ambassador representing the United States in a foreign country.

The US attorney represents the federal government in all federal criminal and civil cases, and serves as a senior advisor to the United States Justice Department and the White House on a wide range of policy issues. Many consider the US attorney to be the “Chief Law Enforcement Officer” of the district and expect the US Attorneys to oversee the implementation of federal law enforcement policies and programs that take place in the dis- trict. Some states have only one judicial district, some have two or three, and large states may have four or five.

Although the president appoints US attorneys, and only the president can remove them, the US attorneys are overseen by the Executive Office of US Attorneys (EOUSA) of the US Department of Justice. For several years, the EOUSA has sought to achieve a greater consensus and consistency regarding the specific role that a US attorney should play in the districts. However, this objective has been elusive, primarily because the US attorney is a political appointee. Quite often, the appointment is made as a reward for supporting a candidate during election or pre- vious work within the political party. Some are elevated from the ranks of the existing prosecutors’ offices, some come from business, some have prior government service experience, some have served in state governments, and some have been defense attorneys. As such, when one combines the independence of a political appointee, with the wide-ranging background of the 94 US attorneys, it becomes clear that trying to fashion a specific role and specific policy for them is quite a daunting task.

In accepting his appointment, John McKay also accepted the designation of Chief Law Enforcement Officer in the Western District of Washington. Based in Seattle, the District covers the entire western part of the state. Over 250 law enforcement agen- cies exist in the state of Washington, with a substantial portion

199John McKay: US Attorney as the Chief Law Enforcement Officer

in the Western District. By indicating his acceptance of the role of Chief Law Enforcement Officer for the District, McKay sig- naled his intention to dramatically change the law enforcement environment in the state of Washington.

The US Attorney’s office consisted of about 75 career attor- neys. Under the previous Administration, attorneys were per- mitted to apply their areas of expertise to various issues with- in the district. These attorneys had expertise in areas such as bankruptcy, civil fraud, cybercrime, organized crime, and local criminal activity. While they were often assigned to large feder- al investigations, each attorney had much discretion to pursue activities consistent with their own interest or area of expertise. As a result, the office had no clear priorities, and could make no independent assessment of local crime or emerging crime. The leadership was clearly decentralized, and the US Attorney did not claim to be the Chief Law Enforcement Officer and accepted no responsibility for improving the level of crime in the District.

Upon assuming leadership of the office, John McKay indicat- ed his desire to fundamentally change the operation of the US Attorney’s office in the Western District and set clear priorities consistent with national priorities, and have a significant impact on the level of crime in the district.

McKay’s Leadership Approach

Immediately upon arrival in office, McKay initiated a series of public discussions in the media, with law enforcement and citi- zen’s groups about the function and responsibilities of the Chief Law Enforcement Officer. He felt that it was his responsibility to do what few were doing for the District by attempting to identify the most significant crime problems and threats to public safety. He included the full community in a discussion of public policy, and established clear priorities and plans for the US Attorney’s Office.

McKay felt the need to understand the perspective of all of the law enforcement entities situated in the District and to de- termine the level of coordination that was needed to effective- ly leverage the collective resources that existed in the District

1A Title III investigation requires sign cant intelligence to justify the court autho- rized use of a wiretap and is an indicator of a proactive investigation.

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against emerging crime. In doing so, he personally visited every law enforcement entity in his district: federal agencies, state po- lice and prosecutors, and local sheriffs. Over a three-month peri- od, he paid a personal visit to most of the local police and sher- iffs in the District, and met with the leadership and the staff in informal discussions. The meetings were very well received and reported in the press. Many local sheriffs indicated that they had never even met a US attorney before, much less hosted one for an in-depth discussion of their problems and issues.

Assessment. As a result of hearing firsthand many of the issues that had prevented a well-coordinated agenda from be- ing developed, McKay undertook a comprehensive review of both performance and emerging crime trends throughout the District. The assessment revealed some stark facts which formed the ba- sis for McKay’s planning initiative:

1) Federal agencies generally played a support role to local agencies in fighting local crime. Largely because of their dis- tance from Washington DC, the local heads of federal agen- cies all believed that their job was to provide some technical and manpower support to local police and sheriff ’s offices, but not to initiate, drive, or conduct detailed investigations of local crime. To the extent they got involved in complex investigations, it was generally to support a national mul- tistate investigation emanating from their headquarters in Washington DC. The best indicator that McKay’s predeces- sors were more reactive than proactive is the fact that the FBI only used its authority to conduct wiretaps (known as Title III investigations) in significant investigations only three times in the year prior to his arrival, whereas the num- ber in other districts was significantly higher. (as were the number of authorized Title III investigations during the rest of McKay’s tenure).1

2) A review of crime trends revealed a lack of initiatives in areas like international drug trafficking, corruption on the waterfront, healthcare fraud, or terrorism—all national pri- orities but none of which were receiving in-depth attention by federal or local agencies in Seattle. Rather, a significant amount of the resources were being devoted to the areas of expertise of various US attorneys such as civil rights and economic crimes.

201John McKay: US Attorney as the Chief Law Enforcement Officer

3) Despite the fact that one third of the United States Navy’s nuclear fleet for the Pacific was located in Seattle, there was no significant counterterrorism program in the region. Leads from other districts were responded to, but little indepen- dent activity was initiated to determine the true nature of the threat.

4) Despite reports of a significant increase in illegal drug trafficking coming from Canada rather than Mexico, none of the drug enforcement agencies had altered their approach or their investigative agenda. McKay commissioned an in- dependent review of drug trafficking cases in Seattle and discovered that a significant percentage of these cases were small, local investigations and were not being investigated as potentially connected to any national criminal syndicates. However, the review concluded that the majority of drug traf- ficking crimes in the area were supported by organized crim- inal enterprises throughout the country.

5) Despite the post 9/11 mandate to maximize information sharing among law enforcement agencies, no changes had been made to the very limited decade-old information shar- ing system that was developed for the city of Seattle.

McKay’s Leadership Strategy

McKay exhibited leadership by systematically addressing each of the issues that were raised in the assessment. Being appoint- ed immediately in the aftermath of the September 11 terrorist attacks, he believed it was important to bring a heightened at- tention to both the terrorist threat and to emerging criminal en- terprises in the entire district. As such, his first priority was to form interagency working groups that consisted of federal, state, and local police officers so that they could begin to leverage the minimal federal presence in that region. He led a counterter- rorism working group, a drug trafficking working group, and a working group to develop intelligence and innovative informa- tion sharing. Each of these working groups included senior of- ficials from the federal agencies as well as senior local officials and each developed a plan of action.

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McKay used these initiatives as input to the overall strategy developed for the Western District of Washington. The resulting Strategic Plan for the Western District of Washington provided for district-wide objectives and priorities, and identified the lead entity that would be asked to coordinate a regional response.

He also reorganized the US Attorney’s Office in Washington by eliminating work he did not consider to be a regional priority and transferred attorneys into areas designated as high priori- ties. These actions obviously caused a significant amount of re- sistance within the US Attorney’s office, and McKay spent many weeks meeting with his staff to work out a variety of solutions. But at the end of the day, with two new deputies supporting his agenda, the majority of the workforce fell in line and began a very productive period of activity.

McKay served in the position for almost four years. Among his chief accomplishments were:

• A strategic plan for the Western District of Washington that integrated law enforcement concerns from all three levels of government. This illustrated a new concept of collaboration among law enforcement agencies, and produced several dramatic initiatives that were imple- mented by leveraging all the resources available with- out any significant increase in resources.

• A heightened federal awareness to areas of high vul- nerability throughout the District, including the threat to commuter ferries that transported 5000 cars daily across the Puget Sound and potential terrorist threats to the Navy’s nuclear fleet in the region.

• An enhancement of many existing investigations by fo- cusing on the criminal enterprise aspect of the inves- tigation, which led to a fivefold increase in the use of FBI Title III (wiretap authorizations) against targeted criminal enterprises and organizations on federal rack- eteering charges.

• An improved process to collaborate with federal agen- cies, sharing threat assessments to significantly in- crease the resources allocated to federal agencies in the District.

203John McKay: US Attorney as the Chief Law Enforcement Officer

• The establishment of the national model for law en- forcement information sharing and intelligence with a LInX pilot project that integrated data from the Navy, the FBI, and all of the state and local agencies in the re- gion. This approach was ultimately endorsed by the US Department of Justice and spread to 10 districts around the country.

Also of note is the fact that McKay was the prosecutor of Canadian marijuana activist Marc Emery for marijuana seed distribution from Canada. Since that time, McKay has called for reform of marijuana laws such that its sale be legally regulated and taxed

For his proactive efforts and the transformation he put in place in the region, McKay received several awards and cita- tions from citizen groups in Seattle, including a group of former judges and prosecutors. He also received the US Navy’s highest civilian award for his role in implementing the LinX information sharing/intelligence capability.

Postscript

In 2006, President Bush fired John McKay. McKay was one of eight US Attorneys ostensibly fired for unsatisfactory perfor- mance. McKay contested the firing in an extensive article pub- lished in the Seattle University Law Review in which he declared that his dismissal was improper and that it was primarily based on a political opposition to some ethical decisions he took as US Attorney that were inconsistent with the policy preferences of the Bush Administration.

Many theories have been suggested to explain the motivation for the firing, which was orchestrated by Karl Rove, the chief po- litical advisor to the president. Among the most prevalent are the following:

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• The closely contested Gubernatorial election of 2004 was won by a democrat by an extremely narrow mar- gin (approximately 100 votes). The Republican Party wanted McKay to initiate legal action to invalidate the election based on alleged voter fraud. McKay requested an FBI investigation into the matter which found no evidence of systemic voter fraud, so McKay decided not to pursue the matter. The Administration continued to push of McKay to convene a grand jury on the issue. McKay continue to assert that he had no legal basis for doing so. To comply with the political preferences of the Party would be an ethical violation of his oath of office. The White House anger at McKay never subsided.

• McKay and many of the other US Attorneys who were fired shared a legal opinion and policy preferences con- cerning cases that was at odds with the political posi- tion of the White House. The group (all republicans) considered themselves to be following the law and their oath of office.

• McKay was asked by then Deputy Attorney General James Comey to lead a working group of US Attorneys to advocate for an effective system for sharing law enforce- ment information in the aftermath of 9/11. The working group advocated for the LInX system, which was being sponsored and made available by NCIS and its director, Dave Brant. This was in opposition to a much scaled down version of information sharing then supported by the US Justice Department leaders. McKay and the US Attorney Task Force claimed an ethical responsibility to provide the nation with the most effective system and pushed back hard against the Attorney General and se- nior DOJ officials.

205John McKay: US Attorney as the Chief Law Enforcement Officer

• Senior government officials have speculated that McKay may have been fired at least in part because of his advocacy for a more aggressive investigation into the murder of an Assistant US Attorney that worked in his Seattle office. His pursuit of the case and subse- quent firing were the subjects of an article by Jeffrey Toobin in the August 6, 2007 issue of The New Yorker.

The one thing all of these explanations have in common is that they describe a leader fully grounded in his ethical beliefs and willing to use the full scope of his authority and his unwav- ering commitment to doing the right thing in order to pursue jus- tice. Each of the positions taken by McKay during his tenure in office reflected extraordinary moral courage and were informed and guided by what he believed to be his ethical responsibilities as the Chief Law Enforcement Officer on behalf of the citizens of Washington State.

Moreover, they were consistent with the public record he had established both in his previous job as the president of the US Legal Services Corporation and his subsequent positions with the US State Department (on providing justice in the Palestinian Authority) and in his work with Seattle University Law School. His reputation for bringing an ethical perspective to public ser- vice (which creating some powerful adversaries), reflected the mutual trust he engendered and has provided a model of public service leadership to a generation of young people.

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Questions to Ponder

1. What do you think was McKay’s most consequential lead- ership action?

2. Do you think that the designation “chief law enforcement officer” was important? Was it necessary?

3. Do you generally agree with his actions? If not, what would you have done differently?

4. What opposition do you think McKay encountered? Who would be opposed to his agenda?

5. Is there a parallel to your own circumstance?

207David Szady and the Transformation of US Counterintelligence

David Szady The Transformation of US Counterintelligence

Globalization has had a major impact on the relationships among nations and on the ability of nations to protect their own vital interests. In the five decades that followed the end of World War II, the security of all nations was seen as a subset of the bipo- lar conflict between the United States and the Soviet Union, in which the leaders of both the Eastern and Western blocks of na- tions provided security and maintained significant control over the activities of their client-states.

But by the mid-1990s and continuing to this day, dramatic changes in the movement of populations, the easy access to in- formation, the ability to exploit data with new technology, and instant global communication created a new and very unique threat to the United States, and the Western World. In the past, the most significant strategic threats to the US originated from known adversaries; those whose intentions were clear and whose information needs were obvious. Protecting against them, although not foolproof, was a relatively straightforward govern- ment responsibility. In general, the US and its allies developed sophisticated counterintelligence programs designed to thwart the efforts of adversaries like the Soviet Union, China, Cuba, and Soviet Bloc countries from Eastern Europe from gaining access to classified and potentially damaging information and using the information to their advantage against the United States.

In 1999, with the signing of a new Executive Order by President Clinton, the United States government recognized the emergence of a new and potentially lethal threat. The threat ex- tended far beyond government programs to any US entity devel- oping or utilizing cutting-edge technology. At risk were existing applications, emerging plans, test data, weapon systems, and technological innovations that would provide foreign compa- nies with a substantial advantage over their US counterparts. This was not information that was gathered in the open market. Rather, this was information that was acquired by the placement of intelligence officers or their surrogates—not in government agencies as was the tradition—but in universities, private busi- nesses, and research laboratories. Countries engaging in this ac-

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tivity included US allies as well as adversaries. Consequently, the US found itself the target of threats from multiple nations, on multiple issues, and at a level that overwhelmed the ability of the existing counterintelligence function and resource base to even address, much less mitigate. This is documented by the significant increase in espionage prosecutions brought by the US against intelligence officers and their surrogates from Israel, Taiwan, France, and Germany, as well as the former Eastern Bloc countries. The existing US programs were simply unpre- pared to address this new threat with its available resource base or any conceivable near-term enhancement.

To address the issue, the White House created the National Counterintelligence Executive (NCIX) and provided it with a new mandate and a new concept of operations. Instead of the traditional counterintelligence approach which was to monitor and follow the activities of a known adversary, the new approach required that the NCIX assume a leadership role within the counterintelligence community by identifying both public and private critical national assets and coordinating an aggressive national effort to ensure that these finite assets remain secure and compromised.

The counterintelligence (CI) community consists of 17 fed- eral agencies that have traditionally been led by the CIA on in- ternational matters, the FBI on domestic matters and DOD on military matters. The NCIX was established as a tripartite or- ganization involving the leadership of these three agencies and their staffs in a coordinated effort.

The NCIX was also intended to signal a new era in inter- governmental collaboration, as the FBI, CIA, and DOD were to share the leadership of the new organization by each appointing a senior member of its leadership team to serve as a three-per- son executive staff over the new agency. The Executive Director position would rotate among the three agencies every two years.

Owing to its lead role on counterintelligence matters for the US, the first Executive Director position went to the FBI. Dave Szady, a counterintelligence agent well known and respected by the counterintelligence community was appointed as the first Executive Director in the Spring of 2001.

1NCIX Strategic Plan

209David Szady and the Transformation of US Counterintelligence

Szady determined that uniting the somewhat fragmented Intelligence Community would require more than just policy pa- pers. As such, he brought a moral perspective to the job which held that merely performing one’s tasks was insufficient. The nation, he claimed, was faced with new and unknown threats and challenges that affected the nation in a far different way than had the threats posed by traditional military/political ad- versaries. The current threat was to American dominance in technology, economics, and military capability. The threat was also ubiquitous. It was not seen in the size or budgets of mil- itary or covert operations, but in the insidious penetration of American businesses, research and development laboratories, and universities—areas not previously given a high priority by agencies whose operations were traditionally directed at foreign intelligence agencies and espionage.

Szady’s efforts were not totally successful. A significant set- back occurred early on in his tenure as he tried to clarify the functional authority that the new organization would have to discharge its oversight of the 17 agencies. In collaboration with his executive team, Szady drafted a Statement of Authorities— to be signed by the director of each of the three principle agen- cies, the FBI, the CIA, and DOD, so as to codify and formalize the authorities that were the basis for the establishment of NCIX. The document generally contained routine requirements for ef- fective oversight of budgets and resource utilization, policy re- view, and program evaluation. Both the FBI and the DOD quick- ly approved and signed the document, but the CIA never did. In refusing to acknowledge the need to modify its traditional way of doing business in light of the new and emerging threat, the CIA was able to significantly delay the early implementation strate- gies of the NCIX.

Nonetheless, in early September, 2001, The National Counterintelligence Strategy was completed and sent to each of the 17 agencies for review and comment. It reflected a com- mitment to undertake actions to protect critical national assets, provide in-depth and candid risk and vulnerability assessments, and conduct cross jurisdictional threat assessments and inno- vative investigative and intelligence programs.1 The document pressed for innovation and collaboration among the three major sectors of the CI community. None of the agencies could achieve

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the mission independently, but Szady put forth an optimal strat- egy of collective and collaborative action, which involved both the government and private sector.

Demonstration of Flexibility

On September 11, 2001, the world changed significantly and Szady was forced to rethink his position in the counterintelli- gence world. With the dominant focus now on counterterrorism, it was clear that the FBI would indefinitely be consumed by the war on terrorism. Szady reasoned that the unprecedented threat and uncertainty about how to respond would significantly low- er the visibility and the priority of the NCIX in the eyes of the Administration. He also realized that this tragedy provided an opportunity for the FBI to regain the leadership of the CI com- munity.

In November of 2001, Dave Szady agreed to return to the FBI as the Assistant Director for Counterintelligence, where he spent the next 5 years putting the strategy he developed for NCIX in place at the FBI. Following in the steps of Bryant and Watson, the new proactive counterintelligence strategy quickly became a model for all CI agencies as the FBI began a program that transformed counterintelligence in the United States with initiatives such the Domain Strategy, the Business and Educational Alliance, Regional CI Working Groups and Strategies, Information Sharing, and multi-agency collabora- tive initiatives. Each initiative was developed as means to fulfill the ethical responsibility of US national security leaders and to change the direction and improve the performance of all member agencies. Consider some of the major initiatives that were adopt- ed, completed, and published in the FBI’s Counterintelligence Strategy within a few months after his arrival back at the FBI.

By summer of 2001, the NCIX produced an initial strategic planning document that discussed the emerging problem and set forth an approach for dealing with it—one that required in- novation and collaboration among the three major sectors of the CI community. None of the agencies could achieve the mission independently, but Szady insisted that the collective action ex- plained below which involved both the government and private sector, was the optimal strategy.

211David Szady and the Transformation of US Counterintelligence

• Know the Domain Counterintelligence agents and an- alysts typically focused their efforts on individuals sus- pected of espionage. But in response to the NCIX vision, the primary focus of counterintelligence efforts now required personnel in the various districts throughout the country to understand what high-value assets were maintained in their jurisdiction and how effectively they were being protected.

• Business Alliance In a similar departure from estab- lished practice, the government created unprecedented collaborative alliances with industry and major univer- sities in the United States. From business, the federal government sought to overcome their significant re- source deficiency by teaming with the security forces of major corporations throughout the United States. In this effort, security programs in major corporations would work with and be trained by the federal govern- ment to recognize suspicious or unusual activity and conduct initial investigations

• Education Alliance To address national security is- sues in higher education, the presidents of the most prestigious universities in the US formed an educa- tional alliance with the counterintelligence community that permitted federal investigators to work with uni- versity laboratories to ascertain whether any classified technology was being passed on to foreign intelligence services from university research labs.

• Leveraging Resources Perhaps most strikingly, from a world in which internal agency secrecy reflected the dominant culture, the clear need to leverage resources among federal agencies quickly broke down the barri- ers that had prevented the sharing of information and knowledge among the 17 counterintelligence agencies. Cooperation was now considered a positive attribute and, while initially resisted, new relationships were made with NCIS and old relationships were strength- ened with the CIA so that the routine sharing of infor- mation began to become institutionalized.

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• Performance Measures Finally, to ensure continual progress, the CI community continued the process that was first used during the initial assessment of identi- fying performance in every field office. Rather than use traditional statistics which rarely provided informa- tion to suggest the threat was being understood, new data was collected from the analysts and supervisors themselves in a continual office-by-office review that indicated the extent to which the various threats were understood, effectively addressed, and mitigated. This effort by itself, which was renewed on an annual basis, produced a highly effective method of measuring and correcting performance as well as a significant retrain- ing of the entire CI workforce.

It was Szady’s intention to begin a process that would lead to the transformation of the US Counterintelligence Community not by simply replacing the existing plan with a new one, but by recognizing the ethical imperative to the nation to guard against this largely invisible threat—one that is often not recognized un- til severe damage has been done. He would accomplish this by urging the rethinking about the nature of the threat, and initi- ating new activities that would cause both our adversaries and our friend to change their behavior.

Szady conditioned his return on a few agreements with the Director that would provide him more autonomy over his pro- gram than was customary in the FBI. The most important of these was the ability to select his senior managers from the ranks of experienced counterintelligence agents, and to not rely on the review and screening by the FBI Career Board. The FBI had long established a policy of requiring senior managers to have experience and demonstrated capabilities in a variety of management programs before assuming executive responsibili- ties at FBI Headquarters.

Szady knew that to complete his transformation and make the strategic plan successful, he had to have executives at Headquarters who were fully knowledgeable, fully experienced, field oriented, and who had the respect of agents in each of the 56 FBI field offices. Because of the tremendous need to rebuild this vital national security program and because most of the

213David Szady and the Transformation of US Counterintelligence

FBI was then focused on counterterrorism, Szady was given the authority to hand pick his executive. In so doing, he selected four individuals who had worked at a senior executive level and placed them in charge of his Espionage Section, China Section, Russian Section, and a newly established organization named the Domain Section. Unrestrained by traditional bureaucratic limitations, the Szady team were able to act quickly and effec- tively and within two years had changed the fundamental oper- ations of the FBI’s counterintelligence program.

CI programs now routinely include phrases like “know the domain,” “the business alliance,” and “information sharing”— phrases that were never heard in the halls of counterintelligence agencies prior to the development and implementation of this strategy. The strategy has been sustained through the admin- istration of four heads of the NCIX and several changes in the leadership of the FBI, the CIA, and other agencies. The CI lex- icon now speaks of preventing the stealing of US government secrets and transfer of critical technologies before they occur, rather than catching spies afterwards. As such, Szady’s efforts produced a transformational effect not only for a single agency, but for an entire sector of government. And it was not conceiv- able without the commitment, moral courage, and trust engen- dered by Dave Szady.

Postscript

Dave Szady demonstrated his commitment in other ways as well. In order to continue to show his commitment to the CI transformation, he extended his tenure from the mandatory re- tirement age of 55 for two years, officially retiring as an FBI Spe- cial Agent at age 57. However, since the job was not completed, he requested the FBI hire him as a civilian employee and make him the first (and only) civilian Assistant Director of an opera- tional program in FBI history. Szady remained in that position for an additional three years, until he was comfortable that the strategy was in place and a succession plan would continue the transformation indefinitely. Thus, he demonstrated his unwav- ering commitment. In so doing, Szady exemplified the standards and expectation of Performance Ethics.

Questions to Ponder

1. Speculate on why the entrenched CIA objected to the Statement of Authorities, especially considering that they are now an excepted part the CI Community.

2. Identify what you consider to be the most effective aspect of the approach taken by the CI. Strategy.

3. The performance measurement approach required a significant level of human interaction to accurately gauge success. Do you believe this is wise for performance measurement?

4. Counterintelligence has always been among the highest priorities in the US government, but it has also been among the most under-resourced. Why do you think this is so?