oversight

DOD Civilian Personnel: Improved Strategic Planning Needed to Help Ensure Viability of DOD's Civilian Industrial Workforce

Published by the Government Accountability Office on 2003-04-30.

Below is a raw (and likely hideous) rendition of the original report. (PDF)

             United States General Accounting Office

GAO          Report to the Subcommittee on
             Readiness, Committee on Armed
             Services, House of Representatives


April 2003
             DOD CIVILIAN
             PERSONNEL
             Improved Strategic
             Planning Needed to
             Help Ensure Viability
             of DOD’s Civilian
             Industrial Workforce




GAO-03-472
                                               April 2003


                                               DOD CIVILIAN PERSONNEL

                                               Improved Strategic Planning Needed to
Highlights of GAO-03-472, a report to
the Subcommittee on Readiness,                 Help Ensure Viability of DOD’s Civilian
Committee on Armed Services, House of
Representatives                                Industrial Workforce


Between 1987 and 2002, the                     DOD has not implemented our October 2001 recommendation to develop
Department of Defense (DOD)                    and implement a DOD depot strategic plan that would delineate workloads
downsized the civilian workforce in            to be accomplished in each of the services’ depots. The DOD depot system
27 key industrial facilities by about          has been a key part of the department’s plan to support military systems in
56 percent. Many of the remaining              the past, but the increased use of the private sector to perform this work has
72,000 workers are nearing
retirement. In recent years GAO
                                               decreased the role of these activities. While title 10 of the U.S. code requires
has identified shortcomings in                 DOD to retain core capability and also requires that at least 50 percent of
DOD’s strategic planning and was               depot maintenance funds be spent for public-sector performance, questions
asked to determine (1) whether                 remain about the future role of DOD depots. Absent a DOD depot strategic
DOD has implemented our prior                  plan, the services have in varying degrees, laid out a framework for strategic
recommendation to develop and                  depot planning, but this planning is not comprehensive. Questions also
implement a depot maintenance                  remain about the future of arsenals and ammunition plants. GAO reviewed
strategic plan, (2) the extent to              workforce planning efforts for 22 maintenance depots, 3 arsenals, and
which the services have developed              2 ammunition plants, which employed about 72,000 civilian workers in fiscal
and implemented comprehensive                  year 2002.
strategic workforce plans, and
(3) what challenges adversely
affect DOD’s workforce planning.
                                               The services have not developed and implemented strategic workforce plans
                                               to position the civilian workforce in DOD industrial activities to meet future
                                               requirements. While workforce planning is done for each of the industrial
                                               activities, generally it is short-term rather than strategic. Further, workforce
GAO recommends that the DOD                    planning is lacking in other areas that OPM guidance and high-performing
complete revisions to core policy,             organizations identify as key to successful workforce planning. Service
promulgate a schedule for                      workforce planning efforts (1) usually do not assess the competencies;
completing core computations, and              (2) do not develop comprehensive retention plans; and (3) sometimes do not
complete depot strategic planning;
                                               develop performance measures and evaluate workforce plans.
develop a plan for arsenals and
ammunition plants; develop
strategic workforce plans; and                 Several challenges adversely affect DOD’s workforce planning for the
coordinate the implementation                  viability of its civilian depot workforce. First, given the aging depot
of initiatives to address various              workforce and the retirement eligibility of over 40 percent of the workforce
workforce challenges. DOD                      over the next 5 to 7 years, the services may have difficulty maintaining the
concurred with 7 of our 9                      depots’ viability. Second, the services are having difficulty implementing
recommendations; nonconcurring                 multiskilling—an industry and government best practice for improving the
with two because it believes the               flexibility and productivity of the workforce—even though this technique
proposed National Security                     could help depot planners do more with fewer employees. Finally, increased
Personnel System, which was                    training funding and innovation in the training program will be essential for
submitted to Congress as a part of
                                               revitalizing the aging depot workforce.
the DOD transformation legislation,
will take care of these problems.
We believe it is premature to                  Staffing Levels, Age, and Retirement Eligibility of Civilian Personnel in Industrial Facilities
assume this system will (1) be                                     FY 2002 civilian                        Percent eligible   Percent eligible
approved by Congress as proposed                Service              staffing levels   Average age        to retire by 2007  to retire by 2009
and (2) resolve these issues.                   Navy                                     35,563   46                   28                  39
                                                Army                                     14,234   49                   41                  52
www.gao.gov/cgi-bin/getrpt?GAO-03-472.          Marine Corps                              1,323   48                   45                  60
To view the full report, including the scope    Air Force                                21,152   47                   35                  44
and methodology, click on the link above.       Total                                    72,272   47                   33                  43
For more information, contact Derek Stewart
                                               Source: DOD (data), GAO (presentation).
at (202) 512-5559 or stewartd@gao.gov.
Contents


Letter                                                                                               1
                       Results in Brief                                                              3
                       Background                                                                    5
                       DOD Lacks Strategic Planning to Guide Future Planning for
                         Industrial Activities                                                     11
                       Services’ Efforts to Develop Industrial Workforce Plans
                         Vary and Generally Lack Some Key Planning Elements                        21
                       A Number of Challenges Inhibit Effective Strategic
                         Workforce Planning                                                        31
                       Conclusions                                                                 42
                       Recommendations for Executive Action                                        44
                       Agency Comments and Our Evaluation                                          45

Appendix I             Scope and Methodology                                                        49



Appendix II            Fiscal Year 2002 Services’ Depots                                            52



Appendix III           Synopsis of Service Depots’
                       Short-Term Workforce Plans                                                   55



Appendix IV            GAO Staff Acknowledgments                                                    64



Related GAO Products                                                                                65



Tables
                       Table 1: Status of Service Depots’ Short-Term Workforce
                                Planning Efforts                                                   26
                       Table 2: Civilian Personnel in Industrial Facilities Eligible to Retire     32




                       Page i                                  GAO-03-472 DOD Depot Workforce Planning
Figures
          Figure 1: Location of 27 Key DOD Industrial Activities                                    6
          Figure 2: Collection of Various Maintenance and Manufacturing
                   Activities Performed in Selected Industrial Activities                            8
          Figure 3: Office of Personnel Management’s Workforce
                   Planning Model                                                                   11




          Abbreviations

          ALC       Air Logistics Center
          DOD       Department of Defense
          OPM       Office of Personnel Managment




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          Page ii                                       GAO-03-472 DOD Depot Workforce Planning
United States General Accounting Office
Washington, DC 20548




                                   April 30, 2003

                                   The Honorable Joel Hefley
                                   Chairman
                                   The Honorable Solomon P. Ortiz
                                   Ranking Minority Member
                                   Subcommittee on Readiness
                                   Committee on Armed Services
                                   House of Representatives

                                   The manufacture and support of military weapons involves a vast array
                                   of industrial capability some of which is in the private sector and some
                                   of which is in the public sector. The part in the public sector centers
                                   around 27 key Department of Defense (DOD) industrial facilities, including
                                   22 maintenance depots, 3 arsenals, and 2 government-owned and-operated
                                   ammunition manufacturing plants.1 The civilian workforce in these
                                   activities was reduced by about 56 percent between 1987 and 2002—from
                                   about 163,000 to about 72,000 employees. The workforce reduction
                                   occurred as a result of downsizing initiatives, the increased use of the
                                   private sector for logistics support activities, and other factors. Because
                                   seniority was a major factor in determining which workers would be
                                   retained and little new hiring has occurred in most of these activities, the
                                   result of downsizing is that more than 7,000 civilian employees, or about
                                   12 percent of the remaining workforce, are currently eligible to retire and
                                   about 43 percent will be eligible to retire by 2009. This has created a
                                   human capital management challenge for DOD. In addition, DOD’s
                                   challenge is exacerbated by the war on terrorism and other critical
                                   military operations while it also is undertaking significant transformation
                                   initiatives and addressing initiatives to further streamline its operations,
                                   including responding to further downsizing mandates.




                                   1
                                    DOD has nine other active ammunition manufacturing plants that are government-owned
                                   and contractor-operated. These nine plants have a total of 145 government civilians,
                                   6 military personnel, and 5,314 contractor personnel. They are not included in this
                                   report’s discussion.



                                   Page 1                                     GAO-03-472 DOD Depot Workforce Planning
    In recent years, we have emphasized the importance of strategic
    planning in DOD for establishing and achieving key mission objectives.2
    We have also identified specific deficiencies in DOD’s planning for depot
    maintenance operations. For example, in October 2001, we reported that
    DOD had no overall plan that tied investments in depot maintenance
    facilities and equipment with future workloads3 and, in turn, with human
    capital needs. At that time we recommended that DOD, among other
    actions, develop a strategic—or long-term—plan for depot maintenance
    that addressed human capital needs and the specific actions necessary to
    meet them.

    This report looks specifically at the strategic workforce planning for the
    27 previously mentioned DOD industrial facilities. Concerned about DOD’s
    apparent lack of a plan for its depot workforce and the potential
    implications of these deficiencies, you asked that we determine

•   whether DOD has implemented our prior recommendation to develop and
    implement strategic plans for depot maintenance;
•   the extent to which the services have developed and implemented
    strategic workforce plans to position the civilian depot workforce to meet
    future requirements; and
•   what challenges adversely affect DOD’s workforce planning for the
    long-term viability of its civilian depot workforce.

    As part of our work, we reviewed DOD’s and the services’ existing
    strategic and other workforce plans for these activities. We visited
    18 maintenance depots, three arsenals, and two ammunition
    manufacturing plants and obtained data from 4 additional maintenance
    depots we did not visit.




    2
     Since 1997, we have issued several reports dealing with DOD’s implementation of
    strategic planning initiatives generated as a result of the Government Performance and
    Results Act of 1993, P. L. No. 03-62. Aug. 3, 1993.
    3
     U.S. General Accounting Office, Defense Logistics: Actions Needed to Overcome
    Capability Gaps in the Public Depot System, GAO-02-105 (Washington, D.C.:
    Oct. 12, 2001).




    Page 2                                        GAO-03-472 DOD Depot Workforce Planning
                   DOD has not implemented our prior recommendation to develop and
Results in Brief   implement a departmentwide depot strategic plan that would delineate
                   future workloads to be accomplished in each of the services’ maintenance
                   depots, and the services efforts to develop comprehensive depot strategic
                   plans vary. Although recognition and maintenance of depots’ core
                   capabilities and their workforces are key to the continued viability of the
                   depot system, DOD’s increased use of the private sector in recent years
                   has decreased the role of DOD’s maintenance depots and raised questions
                   about their long-term future role that have not been addressed by a
                   comprehensive strategic plan. Uncertainties also exist about the future
                   role of DOD arsenals and ammunition plants. Depot officials said that it is
                   difficult to develop a depot strategic plan with so many uncertainties
                   about how the military depots will be used in the future. However, title 10
                   of the U.S. Code provides direction regarding the role of the depots and
                   the allocation of depot maintenance work between the public and private
                   sectors, and it dictates a continuing role for a level of DOD depot
                   maintenance capability. The lack of a strategic plan may have serious
                   implications because without forethought to shape the future of the
                   depots and their workforces, the future capability of the two for
                   performing work is questionable. Absent a departmentwide plan, the
                   services’ efforts to develop comprehensive depot strategic plans vary. For
                   example, the Army, Air Force and Marine Corps have developed depot
                   plans, but the Army plan has been suspended, the Air Force plan does
                   not address one depot nor identify specific new work, and the Marine
                   Corps plan has not been approved and has no approval schedule. While
                   the Navy has not developed a strategic depot plan, two of the Navy
                   components—the shipyard and aviation communities—have begun
                   strategic planning efforts.

                   The services have also not developed and implemented strategic
                   workforce plans that will position the civilian industrial workforce to
                   meet future requirements. Except for the Air Force, the services industrial
                   activities’ workforce plans are mostly short-term rather than strategic. The
                   plans are also lacking in other areas that Office of Personnel Management
                   (OPM) guidance and high-performing organizations identify as key to
                   successful workforce planning. Specifically, they (1) usually do not assess
                   the competencies needed for current and future workforces; (2) do not
                   develop comprehensive retention plans that identify employees critical
                   to accomplishment of organizational goals, develop an infrastructure
                   to assist workers in becoming long-term assets of the organization,
                   or provide meaningful incentives to retain valued employees; and
                   (3) sometimes do not develop performance measures for evaluating



                   Page 3                                GAO-03-472 DOD Depot Workforce Planning
workforce plans to identify corrective actions needed to improve
planning efforts.

Several challenges adversely affect DOD’s workforce planning for the
long-term viability of the workforce industrial workforce. First, given the
aging of the workforce and the eligibility for retirement of about
43 percent of the workforce over the next 7 years, the services could
have difficulty maintaining the viability of these activities. Yet, the
implementation of short-term workforce planning rather than strategic
planning does not address this challenge. Second, the services are having
difficulty implementing multiskilling—an industry and government best
practice for improving the flexibility and productivity of the workforce—
even though this technique could help depot planners do more with fewer
workers. Multiskilling is the process of training maintenance employees
in specific skills that cross the traditional trade or craft lines and then
ensuring that the work is performed. A major advantage of multiskilling is
that particular jobs that require more than one craftnot necessarily more
than one individualcan be performed by fewer personnel. Being able to
provide additional compensation to workers for obtaining the desired new
complementary skills could enhance the depots’ ability to implement this
program successfully. Finally, the need for both increased funds and
innovation in the training program will challenge efforts to revitalize the
depot workforce.

We are making recommendations to the Secretary of Defense to
strengthen strategic workforce planning for DOD industrial activities.
DOD provided oral comments after reviewing a draft of this report,
concurring with seven of our nine recommendations. DOD’s response
highlighted the importance the department places in human capital
management. In non-concurring with two of our recommendations, DOD
officials said that DOD’s new National Security Personnel System will
provide all the flexibilities and authorities needed to maintain and
enhance human resources competencies, capabilities, and performance
across the department. Since the proposed new system has not yet been
considered by the Congress, we believe it is premature to assume that all
its provisions will be approved and that the new system will address
our concerns.




Page 4                                GAO-03-472 DOD Depot Workforce Planning
Background
DOD Industrial Activities       DOD owns and operates industrial activities that support the military
                                mission by repairing; rebuilding; overhauling; and upgrading components,
                                ammunitions, or end items to return them to a like-new condition or
                                by manufacturing new systems components or ammunitions. As of
                                January 2003, and as shown in figure 1, DOD industrial activities included

                            •   twenty-two maintenance depots11 in the Navy (three aviation depots,
                                four shipyards, and four warfare centers—two associated with ship
                                systems and two associated with engineering analyses and command and
                                control), 5 in the Army, 4 in the Air Force, and 2 in the Marine Corps;
                            •   three Army arsenals4 that have a manufacturing mission; and
                            •   two Army ammunition manufacturing plants that are government-owned
                                and -operated.




                                4
                                 The Arsenal Act (10 U.S.C. 4532) provides that the Army is to have its supplies made in
                                U.S. factories or arsenals provided they can do so economically. The act further provides
                                that the Secretary of the Army may abolish any arsenal considered unnecessary.




                                Page 5                                        GAO-03-472 DOD Depot Workforce Planning
Figure 1: Location of 27 Key DOD Industrial Activities




                                          These activities, which are a part of the combined public and private
                                          sector industrial base and are largely staffed by DOD civilians, are
                                          described in appendix II. This appendix also describes the type of work
                                          performed at the activities and the number of DOD civilians employed in
                                          each. The activities generally require extensive shop facilities and
                                          specialized equipment and employ a range of personnel from highly
                                          skilled technicians and engineers to laborers. Figure 2 shows a collection
                                          of maintenance or manufacturing activities performed in some of the
                                          27 industrial activities. In fiscal year 2002, these activities employed about
                                          72,000 civilian employees—about 10 percent of DOD’s civilian workforce.
                                          About 1,200 military personnel are also employed in these activities, with



                                          Page 6                                  GAO-03-472 DOD Depot Workforce Planning
over half the military assigned to the Pearl Harbor Shipyard and
Intermediate Maintenance Activity, which in 1998 consolidated its depot
and intermediate maintenance work into one activity, bringing together
the largely military workforce employed in the intermediate activity with
the largely civilian population employed in the shipyard. In the other DOD
industrial activities, military personnel are largely in managerial or
supervisory positions. Of the approximately 72,000 civilian employees, the
Army employs about 14,200; the Navy, about 35,500; the Marine Corps,
about 1,300; and the Air Force, about 21,100. Various factors (such as the
downsizing of the U.S. military force structure; increased use of the private
sector for performing support activities; and changes in repair processes,
increasing equipment’s time in the field) have resulted in significant
reductions in the number of personnel working in these facilities. For
example, the number of personnel assigned to DOD maintenance depots
was reduced by about 60 percent between 1987 and 2001—from about
156,000 to about 64,500 workers, while the total amount of maintenance
work was cut in half during that period.




Page 7                                 GAO-03-472 DOD Depot Workforce Planning
Figure 2: Collection of Various Maintenance and Manufacturing Activities Performed in Selected Industrial Activities




                                         Page 8                                     GAO-03-472 DOD Depot Workforce Planning
The Government        Improved strategic planning has been a key goal of the federal government
Performance and       in recent years, with the Government Performance and Results Act of
Results Act of 1993   1993 providing guidance on strategic planning for government activities.5
                      Strategic plans are intended to be the starting point for each agency’s
                      performance measurement efforts. Each plan is to cover a period of
                      5 years and must include a comprehensive mission statement, which
                      discusses, among other things, the agency’s major functions and
                      operations, a set of outcome-related goals and objectives, and a
                      description of how the agency intends to achieve these goals and
                      objectives. We previously reported that high-performing organizations
                      begin their strategic planning by defining what they want to accomplish
                      and what kind of organization they want to be.6 Similarly, agencies
                      establish their missions, visions for the future, core values, goals and
                      objectives, and strategies.


Strategic Workforce   High-performing public organizations have found that strategic planning
Planning              and management can address human capital, or workforce, shortfalls.
                      Strategic workforce planning—planning that focuses on developing
                      long-term strategies for acquiring, developing, and retaining an
                      organization’s people and for aligning human capital approaches that
                      are clearly linked to achieving programmatic goals—is a key part of
                      human capital management. In short, according to a National Academy of
                      Public Administration guide on building successful organizations, strategic
                      workforce planning is a systematic process for identifying the human
                      capital required to meet organizational goals and developing the
                      strategies to meet these requirements. To help meet organizational goals,
                      organizations use workforce planninggetting the right people with the
                      right skills in the right jobs at the right time—that is explicitly linked to the
                      agency’s overall mission and goals.




                      5
                          P.L. No. 103-62, Aug. 3, 1993.
                      6
                       U.S. General Accounting Office, Human Capital: A Self-Assessment Checklist for Agency
                      Leaders, GAO/OCG-00-14G (Washington, D.C.: September 2000).




                      Page 9                                      GAO-03-472 DOD Depot Workforce Planning
    While many organizations have developed models for workforce planning,7
    putting aside variations in terminology, the models generally include the
    following steps.

•   Set strategic direction, including the identification of organizational vision
    and objectives at that point in the future on which planning will be based.
    This direction should also include human capital goals.
•   Identify workforce skills and competencies needed to achieve the
    objectives. Analyze the present workforce to determine what skills and
    competencies are present. Compare the present workforce skills and
    competencies to those needed in the future. This step is sometimes
    referred to as “gap analysis.”
•   Develop an action plan to transition from the present workforce to the
    future workforce. The action plan should address recruiting, hiring,
    training, succession, and retention.
•   Implement the action plan by developing well-defined objectives, specific
    measurable workforce goals, and timetables and milestones; conducting
    recruiting and training; and putting retention strategies into practice.
•   Establish performance measures; periodically evaluate the workforce
    action plans, review the mission and objectives to ensure they remain
    valid; and make adjustments as required by changes in mission, objectives,
    and workforce skills and competencies.

    Strategic workforce planning is an iterative process, as demonstrated by
    the OPM’s workforce planning model in figure 3.




    7
     For example, OPM’s Workforce Planning Model (http://www.opm.gov/workforce
    planning/wfpmodel.htm) and U.S. General Accounting Office, Exposure Draft: A Model of
    Strategic Human Capital Management, GAO-02-373SP (Washington, D.C.: March 2002).




    Page 10                                     GAO-03-472 DOD Depot Workforce Planning
                        Figure 3: Office of Personnel Management’s Workforce Planning Model




                        As a guide to help agencies in their human capital management efforts,
                        the OPM issued the Human Capital Assessment and Accountability
                        Framework in November 2002. This document provides standards for
                        success that include, among other things: (1) strategic alignment,
                        (2) workforce planning and deployment, and (3) suggested performance
                        indicators. Criteria provided in other workforce planning models we
                        reviewed are compatible with the more recent OPM framework.


                        Although we have previously recommended the development and
DOD Lacks Strategic     implementation of a strategic plan for depot maintenance, DOD does
Planning to Guide       not yet have a strategic plan to guide the future development of depot
                        maintenance activities, and questions continue about core capabilities
Future Planning for     and future work. While the DOD depot system has been a key part of the
Industrial Activities   department’s plan to support military systems, the increased use of the
                        private sector to perform work previously performed by DOD employees
                        has decreased the role of the services’ depots and raised questions
                        regarding their future. Title 10 of the U.S. Code provides direction
                        regarding the role that DOD depots should play in supporting the fighting


                        Page 11                                 GAO-03-472 DOD Depot Workforce Planning
                           forces and in how depot work should be allocated between the public
                           and private sectors. However, while some action has been taken to begin
                           formulating a depot strategic plan, DOD does not yet have a strategic plan
                           for its depot maintenance activities, and it is uncertain when it will be
                           completed. Absent a comprehensive DOD plan, the services have in
                           varying degrees initiated a strategic depot planning effort. Generally,
                           however, the service versions do not identify what work will be performed
                           in the service depots in the future, and it is uncertain whether these
                           activities will continue to be viable as the systems they support age and
                           are phased out of the inventory.


Legislation Provides       Although legislation requires the continued performance of some key
Direction Regarding the    industrial activities—core capabilities—in government-owned facilities
Continued Performance of   and by government personnel and specifies that not more than 50 percent
                           of funds spent for depot maintenance may be spent for work performed
Depot Maintenance in       by the private sector, DOD has in recent years increasingly relied on the
DOD Activities             private sector for the performance of various logistics activities, including
                           depot maintenance. In the past, the department requested repeal of
                           legislative provisions that influenced the continued use of DOD facilities
                           and personnel performing depot maintenance activities and recently again
                           considered proposing the repeal in order to gain flexibility for its business
                           decisions. However, the identification and acquisition of future core
                           capabilities are key to strategic depot planning.

                           Section 2464 of title 10 requires the Secretary of Defense to identify and
                           maintain a core logistics capability. Under that provision, the core logistics
                           capability is to be owned and operated by the government to ensure the
                           existence of a ready and controlled source of technical competence and
                           resources so that the military can effectively and timely respond to
                           mobilization, national defense emergencies, and contingencies. The core
                           capabilities are to include those necessary to maintain and repair the
                           weapon systems and military equipment that the Secretary, in consultation
                           with the Chairman of the Joint Chiefs of Staff, identifies as necessary to
                           meet the nation’s military needs. Furthermore, the Secretary is to identify
                           the workloads required to maintain those core capabilities and to require
                           their performance in government facilities. Finally, the Secretary is to
                           assign these facilities sufficient workloads to ensure peacetime cost
                           efficiency, technical competencies, surge capacity, and reconstitution
                           capabilities to support military strategic and contingency plans.
                           Nonetheless, the concept of core capabilities is not precise and has been
                           controversial. We have previously reported that the department’s
                           implementation of the core statute is not comprehensive and that the


                           Page 12                                GAO-03-472 DOD Depot Workforce Planning
policy and implementing procedures and practices provide little assurance
that core maintenance capabilities are being developed as needed to
support future national defense emergencies and contingencies.8 In
response to our report, DOD has revised its core policy to improve the
department’s guidance to the military services regarding how core
capability requirements should be developed. Although this guidance has
been issued, questions remain about the guidance and the services are not
accomplishing key analyses to identify essential core capabilities.

In addition, 10 U.S.C. 2466 specifies that no more than 50 percent of the
funds made available for depot maintenance may be spent for private
sector performance, unless the requirement is waived for a particular
fiscal year. This sets aside 50 percent of the funding for public-sector
performance of these workloads. In recent years, our mandated reviews
of the allocation of depot maintenance work between the public and
private sector with regard to the 50 percent funding rule have found
that increasing amounts of the service’s depot work was going to the
private sector. For example, during fiscal 2001 and 2002, the Air Force
exceeded the 50 percent limit and waived the requirement; we could not
determine with precision whether the Army was in compliance with the
50 percent provision.9

Because DOD implemented an acquisition policy that called on the private
sector for life-cycle logistics support of its weapons systems, during the
1990s most new weapon system programs called for using private-sector
maintenance providers, with depot repair of few new programs going to
military depots.10 With some increased visibility and awareness of the 50-50
and core provisions, DOD has recognized the need to revitalize the depots.
DOD guidance supports the use of public-private partnerships. In some of
these partnerships, private-sector logistics providers subcontract with
military depots for some depot maintenance work. We recently reported
that public-private partnerships comprise only about 2 percent of DOD’s


8
 U.S. General Accounting Office, Defense Logistics: Actions Needed to Overcome
Capability Gaps in the Public Depot System, GAO-02-105 (Washington, D.C.:
Oct. 12, 2001).
9
 U.S. General Accounting Office, Depot Maintenance: Change in Reporting Practices and
Requirements Could Enhance Congressional Oversight, GAO-03-16 (Washington, D.C.:
Oct. 18, 2002).
10
  U.S. General Accounting Office, Defense Depot Maintenance: DOD Shifting
More Workload for New Weapon Systems to the Private Sector, GAO/NSIAD-98-8
(Washington, D.C.: Mar. 31, 1998).




Page 13                                     GAO-03-472 DOD Depot Workforce Planning
                             depot maintenance work, and while the department plans to significantly
                             increase the use of such partnerships, there are some challenges that
                             must be overcome if the department’s planned expansion of partnerships
                             is to be realized.11 It is uncertain the extent to which public-private depot
                             maintenance partnerships will result in contractor personnel replacing
                             DOD civilian personnel in depots. However, because the 50-50 guidance
                             provides that the funds for some depot partnerships are not counted when
                             applying the 50 percent limitation, partnership work could be a vehicle for
                             transferring significant amounts of maintenance to the private sector
                             without exceeding the 50 percent limitation.

                             DOD recently considered proposing changes to title 10 depot
                             maintenance provisions. A legislative proposal that was associated
                             with the department’s transformation agenda suggested repealing six
                             sections that impose limitations on the management of depot-level
                             maintenance and repair by requiring certain amounts of work to be
                             performed in public depots.12 According to the proposed repeal, these
                             limitations reduce the flexibility necessary for the department to make
                             proper and efficient business decisions in determining the source for
                             depot-level maintenance and repair. Although DOD decided not to submit
                             this proposed repeal at this time, similar language could be proposed in
                             the future.


DOD Still Has No Strategic   We previously recognized the importance of the depot maintenance
Depot Maintenance Plan       mission, noted that it is unclear what future role is planned for the military
and the Future of the        depots in supporting DOD’s military mission, and recommended that the
                             department develop a strategic plan for the military depots.13 However,
Depots Is Uncertain          while DOD has initiated some action toward developing a depot strategic
                             plan, the department still has no depot strategic plan and the future of
                             these activities is uncertain.




                             11
                               U.S. General Accounting Office, Depot Maintenance: Public-Private Partnerships
                             Have Increased, but Long-Term Growth and Results Are Uncertain, GAO-03-423
                             (Washington, D.C.: Apr. 10, 2003).
                             12
                               The sections that DOD considered proposing for repeal were 2460, 2464, 2466, 2469,
                             2470, and 2472.
                             13
                              U.S. General Accounting Office, Defense Logistics: Actions Needed to Overcome
                             Capability Gaps in the Public Depot System, GAO-02-105 (Washington, D.C.:
                             Oct. 12, 2001).




                             Page 14                                      GAO-03-472 DOD Depot Workforce Planning
Thus, DOD continues to manage its depots on an ad hoc basis
without clearly defining their role for the future and the capabilities
that are required to assure the continued performance of that role. The
implications for the future are uncertain. In short, as we have reported,
the future capability for performing work in the military depot
maintenance facilities is questionable because no overall plan exists that
ties investments in depot maintenance facilities and plant equipment with
future workloads and, in turn, with human capital needs. Furthermore,
no other department plan provides required direction to shape the future
of these facilities and their workforce. Without strategic planning that
identifies which capabilities these activities will need to provide in the
future, there is no assurance they will be able to support future readiness
requirements as they have in the past. For example, DOD’s latest logistics
strategic plan, which was developed in August 1999, neither mentioned
maintenance nor the large infrastructure and cadre of personnel required
to operate and support the DOD maintenance depots.14 This occurred even
though maintenance is an important logistics activity that is essential for
keeping complex weapon systems ready to perform even though about
half the department’s depot maintenance work is currently performed in
military depots.

Under the Government Performance and Results Act, federal agencies
are required to develop strategic plans that include mission statements,
strategic goals and objectives, and describe how the agencies intend to
achieve their goals and objectives through their activities, human capital,
information, and other resources. Depot officials said it is difficult to
develop a depot strategic plan with so many uncertainties about how the
military depots will be used in the future. This is particularly true in
light of the support initiatives implemented in recent years to contract
out to the private sector most logistics support activities, including depot
maintenance, for new and upgraded systems and also in light of the base
realignment and closure process that is planned for 2005. These initiatives
indicate that the role of military depots could be further reduced in the
future. But how much it will be reduced is not clear. However, as long as
title 10 requirements remain, DOD will be limited in the extent to which it
can reduce the amount of work performed in DOD depot repair activities.




14
  DOD has not updated its logistics strategic plan since the 1999 plan. The document
highlighting current logistics initiatives is the Future Logistics Enterprise, which consists
of six elements, one of which is depot maintenance partnerships.




Page 15                                         GAO-03-472 DOD Depot Workforce Planning
Absent DOD Direction,       Without benefit of a departmentwide strategic depot plan that clarifies the
the Military Services’      future role of military depots, the military services to varying degrees have
Efforts to Develop          provided a prospective for future depot management, with that of the Air
                            Force and the Navy shipyards being the most mature. However, by and
Strategic Plans Vary, but   large, the vision provided is based on short-term workload projections—
Generally Are Weak in       1 to 2 years beyond the current year—and does not provide the strategic
Defining Future Work        long-term look that is needed to guide future workforce decision making.

Army                        The Army does not have a current strategic depot plan, and its outdated
                            plan was not comprehensive. According to Army planners, although the
                            Army had a Depot Maintenance Enterprise Strategic Plan, the plan was
                            suspended pending reassessment of depot capabilities and requirements
                            as part of an ongoing study of depot proliferation. Further, while the
                            suspended plan was intended to provide mission and vision statements, it
                            was generally oriented toward improving depot business operations and
                            it was not a comprehensive plan that provided a basis for guiding future
                            depot planning.

                            Although not specifically addressed in the plan, in recent years, work
                            assigned to the Army depots has greatly declined as have the workforces
                            assigned to the depots. We reported in November of 1998, however, that
                            the Army did not have a sound basis for identifying the number of
                            positions to be eliminated from its depots.15 This was particularly the
                            case in determining the number of direct labor personnel needed to
                            support depot workload requirements. To address this problem, the
                            Army implemented the Army Workload and Performance System to
                            correlate workload and funding requirements with the depot workforce.
                            Nonetheless, this system does not provide the visibility of new systems,
                            modernization programs, and upgrades that will have depot work that
                            could be assigned to the depots.

                            Depot planners said they have little assurance that new systems will be
                            brought in, as the older systems they currently work on are phased out
                            of the inventory. Recently, ownership of Army depots has shifted to
                            subordinate commands of the Army Materiel Command that are
                            responsible for the sustainment of Army systems. It was hoped that this
                            change would increase the commands’ use of the depots and better



                            15
                              U.S. General Accounting Office, Army Industrial Facilities: Workforce Requirements
                            and Related Issues Affecting Depots and Arsenals, GAO/NSIAD-99-31 (Washington, D.C.:
                            Nov. 30, 1998).




                            Page 16                                    GAO-03-472 DOD Depot Workforce Planning
integrate depot work into the overall command mission performance,
but it is too soon to know if this will be successful. The subordinate
commands such as the Tank-automotive and Armaments Command
and Aviation and Missile Command, which are responsible for making
decisions about how support work will be allocated between the public
and private sectors, were also responsible for decisions that moved
responsibility for much of the work that used to be performed by the
depots to the private sector. These actions were based on new acquisition
guidance encouraging the use of contractor support.

The Army’s suspended depot strategic plan identified five issues, one of
which relates to depot workforce planning by keying in on the capability
of the depot workforce to meet future requirements. The plan’s goal for
this strategic issue was “to ensure a sustainable, multi-skilled workforce
that is capable of meeting future depot maintenance requirements;” and
the plan identified implementation objectives and measurable criteria.
Nonetheless, as previously noted, it is unclear what the depots’ future
work will be. Therefore, as older systems are phased out of the inventory,
it is unclear what, if any, new work will be phased in. This was not
addressed in the suspended plan.

The arsenals and manufacturing ammunition plants have strategic plans
or draft plans providing a mission, vision statements, and goals for the
organizations. However, it is unclear whether the extent that the vision
these activities have for themselves is the same as the one that Army
headquarters and the parent commands have for these organizations.
Neither the Army nor most of the parent commands have officially
published strategic plans that identify the vision and objectives for these
activities. Most arsenals’ workload and corresponding workforce have
been declining for years. The arsenals generally project workload and
corresponding workforce requirements primarily by consulting customers
and prospective customers regarding their future workload for the
arsenals. Arsenal officials said that this methodology provides a
reasonable workload projection for only 2 years. Further, some of the
work that is done in the arsenals is not the type of manufacturing work the
arsenals used to perform. For example, instead of manufacturing large
artillery systems, more than 40 percent of workload performed in the
Rock Island arsenal is manufacturing and assembling tool kits—ranging
from carrying-case sized sets to fully equipped maintenance shelters.
A recent Rand study proposed privatizing the arsenals, but it is unclear to
what extent the Army will pursue this strategy in the future.




Page 17                               GAO-03-472 DOD Depot Workforce Planning
       The ammunition plants have a fluctuating workload, sometimes increasing
       and sometimes declining. The work at two government-owned and
       government-operated ammunition plants has declined in the past years,
       but it is now increasing. The McAlester, Oklahoma, ammunition plant, for
       example, will hire more than 200 new employees in fiscal year 2003,
       primarily because the bomb production workload has increased.
       According to ammunition plant managers, they are generally aware of
       their workload from less than 1 year to 2 years in advance.

Navy   The Navy does not have an overall strategic plan that covers all
       Navy depot maintenance activities, but the naval shipyard and aviation
       communities each have strategic planning efforts.

       The Navy’s plan for shipyards, called the Naval Shipyard Business Plan for
       Fiscal Years 2001 to 2005, has the essential elements of a strategic plan. It
       is aligned to the Naval Sea Systems Command’s corporate strategy. The
       plan communicates the purpose and direction for naval shipyards and
       focuses on ship maintenance, workload performance, and associated
       improvement initiatives, including making investments in training, skills,
       and facilities necessary through 2005. It includes workload information
       from fiscal year 2001 to 2010. The plan has a strategic workforce goal for
       the naval shipyard workforce to have the skills and flexibility required to
       meet the demands of the future workload and business environment.

       The naval shipyard plan describes the relationship of the naval shipyards,
       which comprise the public sector’s share of the ship industrial base, to
       the overall industrial basethe total force. According to the plan, the
       shipyards must have a workforce that is capable of doing all the work.
       However, Navy officials said that, in reality, with regard to the ship
       repair business, the public sector and private sector personnel are
       complementary and personnel from both sectors are now used to support
       work that is primarily the responsibility of a shipyard from the other
       sector. This strategic planning approach would appear to drive workforce
       planning that is also complementary, but the shipyard business plan does
       not discuss private sector shipyard personnel.

       The naval aviation community published its Depot Maintenance Strategic
       Plan in December 2002. This document is not a complete plan, but it
       provides the framework for general doctrinal policies and principles that
       will provide the future direction of naval aviation maintenance. It defines
       four strategic goals for the depot system: (1) maximize the ability to
       favorably impact war fighter readiness and safety, (2) reduce the war
       fighters’ total cost of ownership, (3) fully integrate depot maintenance into


       Page 18                                GAO-03-472 DOD Depot Workforce Planning
               total life-cycle logistics management, and (4) become the knowledge base
               for naval aviation depot maintenance. The plan does not identify the
               workload and a workforce capability expected to be required at individual
               depots but does reveal that airframe work and modification work will
               be reduced and component rework and in-service engineering and
               logistics support work increased. The plan indicates that public-private
               partnerships will be pursued and are expected to be a significant share
               of the Navy depot maintenance business. According to Naval Aviation
               Systems Command officials, the strategic plan is the first of several
               documents that will be produced, with a depot business plan and
               comprehensive depot human resources plan to follow. The plan also noted
               that changes in title 10 legislation could be needed to implement the plan.

               Strategic planning for the naval warfare centers is done for an entire
               center and includes the depot maintenance function. Depot maintenance
               is not the primary function of the centers but is integrated within several
               departments’ operations and is not centrally managed. For example, depot
               maintenance at the Naval Surface Warfare Center Crane Division supports
               engineering efforts within three departments and is not centrally managed;
               rather each department manages the depot operations. Strategic planning
               does not specifically address depot operations but includes workforce
               goals for the center, which includes depot workers.

               The Space and Naval Warfare Systems Command has depot operations
               located at two centers but depot maintenance is not the primary function
               of the centers. Each center has a strategic plan that includes depot
               operations. Depot operations are managed at the division levels in the
               centers, which provide engineering support for various systems. The
               divisions have strategic plans that include workforce goals, which include
               depot workers. The two centers’ depot operations are not structured like
               other Navy depots and shipyards, where certain types of repairs are
               directed. Instead, they compete with other depots and repair activities
               for work.

Marine Corps   The Marine Corps does not yet have an approved strategic plan to guide
               actions to hire, develop, and retain the depot workforce of the future.
               However, efforts are under way to improve strategic planning at the
               Headquarters and at the Materiel Command, which is responsible for
               identifying depot maintenance requirements and the amounts and types of
               workload for the depots.

               Headquarters Marine Corps has a draft plan, Depot Level Maintenance
               Strategic Plan, that contains mission and vision statements and


               Page 19                               GAO-03-472 DOD Depot Workforce Planning
            three related goals for improving the support of weapon systems and
            equipment at the depot level. This draft plan does not identify the Marine
            Corps organizations or offices responsible for implementing or monitoring
            the plan. According to a Headquarters Marine Corps official, no schedule
            has been established for the plan to be reviewed, approved, and issued.

            The Materiel Command’s draft strategic plan for fiscal years 2003 through
            2008 contains mission and vision statements and six goals to improve
            materiel life cycle management of weapon systems and equipment at the
            depot level, but it is not depot specific. Command officials said that the
            plan, when finalized, would have metrics to evaluate implementation but
            is on hold pending decisions regarding the reorganization of the Materiel
            Command. As of February 2003, the command had no schedule for
            finalizing the plan. Logistics Bases, a subordinate command of Materiel
            Command, which owns the depots, published its first strategic plan
            about 2 years ago. Its current plan is not depot specific and is mostly
            business-process oriented, with only one of its six broad goals focused on
            workforce issues. Although the plan has mission and vision statements,
            Logistics Bases officials acknowledged that planning efforts do not yet
            address all the elements of workforce planning suggested by OPM and
            GAO because the command did not yet have the data it needed (such
            as attrition rates, retirement trends, and skill gaps) for these analyses.
            Officials of Logistics Bases also said the command has recently contracted
            for data collection and analysis on depot workforce and equipment
            activities that would provide a baseline for future strategic planning.
            Further, officials said they plan to use metrics to implement the plan and
            evaluate the results.

Air Force   The Air Force is the most progressive in its depot maintenance strategic
            planning. In August 2002, the Air Force issued a Depot Maintenance
            Strategy and a Depot Maintenance Master Plan covering fiscal years
            2004-2020. These plans provide a roadmap designed to ensure the
            continuing viability of Air Force’s three military depots to meet the war-
            fighter mission needs. However, the plans did not include the Aerospace
            Maintenance and Regeneration Center. The plans are intended to posture
            the Air Force’s three other depots to support both new weapons systems
            and new technologies entering the inventory, as well as its aging systems.
            They have a workforce component, which calls for new and younger
            workers to be acquired and trained prior to the loss of the highly skilled
            workers who are nearing retirement to leverage their knowledge and
            skills. In addition, the Air Force plans call for an increased capital
            investment of approximately $150 million per year over the next 6 fiscal
            years, starting in fiscal year 2004, to modernize the Air Force depots.


            Page 20                               GAO-03-472 DOD Depot Workforce Planning
                        However, key financial elements of the strategy and plan have changed
                        somewhat since the issuance of the strategic and master plans. Most
                        significantly, future capital investment plans, operational improvements,
                        and workforce enhancements are still evolving and uncertain. For
                        example, according to our analysis, funds for replacing and modernizing
                        equipment used to accomplish current workloads are less than projected;
                        funding amounts and sources for acquiring new capabilities to be provided
                        by weapon system acquisition programs and the private sector are
                        lagging and uncertain; and funding is not sufficient to implement
                        initiatives to improve depot operations and financial systems and for
                        workforce enhancements.


                        Strategic workforce planning is intended to focus on developing, by its
Services’ Efforts to    definition, long-term human capital strategies that are linked to achieving
Develop Industrial      key programmatic goals. Strategic workforce planning requires a strategic
                        plan, and as previously discussed, DOD still has not developed a depot
Workforce Plans         strategic plan. Thus, the services generally do not perform strategic
Vary and Generally      workforce planning that is tied to meaningful long-term visions, objectives,
                        and strategic goals for their services’ military roles and missions. However,
Lack Some Key           in varying degrees, each of the services performs short-term depot
Planning Elements       workforce planning that is tied to the budget preparation process. The
                        services’ existing short-term workforce plans usually do not assess the
                        workforce competencies needed to address future skill gaps, do not
                        have comprehensive retention plans, and sometimes lack performance
                        measures to evaluate the plansall areas identified as key to successful
                        workforce planning.


Service Depot           Each of the services performs short-term workforce planning that is tied
Workforce Planning Is   to the budget process. While largely not strategic in nature, the services
Largely Short-Term      perform most aspects of workforce planning, which in varying degrees
                        address some elements of workforce planning identified by the OPM and
                        high-performance organizations. Appendix III provides a synopsis of the
                        services’ short-term depot workforce planning efforts.

Army                    The Army Materiel Command and its subordinate commands are
                        responsible for determining the work for the Army’s five maintenance
                        depots. Semiannually, they hold workload conferences to review, analyze,
                        document, and assign work to the depots. Once workload is assigned,
                        the depots determine the number of employees needed to support the
                        workload, including (1) direct labor workers who charge time to finite
                        job taskings; (2) indirect workers, such as shop supervisors and parts


                        Page 21                                GAO-03-472 DOD Depot Workforce Planning
expediters, whose time supports the overall depot maintenance process
rather than finite jobs; and (3) general and administrative overhead
personnel such as production managers, technical specialists, financial
managers, personnel officers, logisticians, contracting officers, computer
programmers, and computer operators. Determining personnel
requirements is an iterative process that begins with the depots and
subordinate commands. The commands use the Army Workload and
Performance System to identify projected workload and the future
staffing requirements based on year-to-year workload changes, known
organizational adjustments, efficiencies such as the Quadrennial Defense
Review, and most efficient organization studies. After agreement is
reached, the proposed staffing levels, which are included in the
consolidated depot budgets, are forwarded for review up the chain of
command. These commands can revise the levels initially requested
based on past performance and other evolving workload and staffing
information. Once the staffing levels are approved, the depots establish
plans and take actions to size and reshape the workforce to support
workload. These actions, in keeping with workforce planning, include
identifying what skills may be lacking to support the workload and
developing hiring plans to recruit new workers; training plans for new and
existing workers to develop and enhance critically needed skills; or, if
staffing levels are low, measures to accomplish the assigned workload
such as increased use of overtime. These plans could also include
reducing the number of depot workers, if the projected work does not
support the number of workers.

Although each of the three arsenals determine their future workload and
estimate future workforce requirements somewhat differently, the
arsenals generally accomplish the task by (1) examining the currently
funded work, (2) requesting customers and prospective customers to
predict their workload for the arsenals for the next 2 to 3 years and
estimating the labor hours and skills to provide the predicted
products, (3) examining historical trends such as unexpected orders
received, (4) discussing workload with their parent organizations, and
(5) developing their workload and workforce requirements. The projected
workload and workforce requirements are reviewed and approved at the
parent organizations using a predictive staffing model to validate the
arsenals’ computations. Most arsenals estimate the workload and
workforce requirements for 2 to 3 years in advance, and officials said their
estimates for this time period are generally fairly accurate. The Watervliet
Arsenal in New York estimates its workload for 6 years in advance, but
officials acknowledged that estimates beyond 3 years are subject to
change. However, they believe estimates are generally reliable.


Page 22                               GAO-03-472 DOD Depot Workforce Planning
                        The Army’s two ammunition manufacturing plants’ workload generally
                        comes from their parent organization—the Joint Munitions Command
                        (formerly Operations Support Command)based on customer orders.
                        The orders may come from other services or from commercial
                        organizations, but the orders are placed through the parent organization.
                        A predictive staffing model is used to determine the workforce
                        requirements. Firm orders are usually placed no more than 1 year in
                        advance, and the plants’ workloads are generally known from less than
                        1 year to 2 years in advance.

Naval Aviation Depots   The Naval Air Systems Command distributes the annual and future
                        (2 years) industrial-based workload to the three naval aviation depots.
                        Once the depots receive the workload, they use historical workload data
                        and staffing models to determine the civilian manpower requirements
                        needed to accomplish the assigned workload. The staffing models break
                        the total workload into the number of workers needed in each shop and
                        the related trade skills required. These models include historical factors
                        such as direct labor personnel, leave, and overtime percentages. The
                        depots then develop the workforce requirements for the aircraft, engines,
                        and component programs. Once the requirements are developed, the
                        depots also prepare plans that include the specific skills, numbers, and
                        types of workers needed in each production shop. These plans are used to
                        establish hiring, training, and recruitment efforts at the depots. After the
                        depots establish the workforce requirements, they are forwarded for
                        review and approval to the Naval Air Systems Command.

Naval Shipyards         The Naval Sea Systems Command distributes the workload to the four
                        shipyards that determine the workforce requirements to accomplish the
                        planned work. The Naval Sea Systems Command provides the shipyards
                        with depot maintenance workload for at least 6 years. The shipyards’
                        workload is predetermined from legislation, the availability of ships,
                        depot-level maintenance requirements, and the budget. The primary tool
                        the Naval Sea Systems Command and shipyards use to forecast workloads
                        and workforces for budgeting and planning purposes is the Workload
                        and Resource Report, which includes data on the current year and
                        2 subsequent years. Each shipyard is provided its assigned workload
                        schedules so they can develop their workload and resource reports for the
                        workforces of each production shop. As part of the shipyards’ processes
                        for determining the workforce and skills to efficiently execute the
                        workload, each shipyard uses a resource allocation process. The resource
                        allocation process determines the right number of workers with the right
                        skills to efficiently execute the workload. Also, the shipyards’ production
                        shops implement hiring and training plans and skills assessments to


                        Page 23                                GAO-03-472 DOD Depot Workforce Planning
                          support critical skills that are determined to be necessary for
                          successful execution of ship maintenance. After the shipyards’ workforce
                          requirements are determined, they are forwarded for approval to the Naval
                          Sea Systems Command and included in the command’s budget.

                          The Naval Sea Systems Command also has two warfare centers. Depot
                          operations at both centers receive annual projected workload allocations
                          from their prospective customers. The centers use the annual budget
                          workload forecasts and knowledge of program’s future plans to determine
                          the civilian workforce requirements. Also, civilian workforce requirements
                          are based on workforce demographics such as attrition and retirements.
                          The workload allocations combined with changes in the civilian workforce
                          demographics provide hiring and training requirements for the centers.
                          The civilian workforce requirements for the depot operations are
                          forwarded through the centers for approval and review up the chain
                          of command.

Space and Naval Warfare   The Space and Naval Warfare Systems Command has two depot
Systems Centers           maintenance activities that are not structured like the other naval depots
                          and shipyards, where certain types of repairs are directed. Rather, these
                          centers compete with other depots and repair activities for their workload.
                          The depot operations’ workforce allocations are directly dependent on the
                          annual workloads they solicit and maintain from customers such as the
                          Naval Inventory Control Point, other services, and naval commands. Depot
                          operations at the centers receive annual workload information from their
                          perspective customers, which are used to develop civilian workforce
                          requirements. Hiring and training plans are developed according to the
                          annual civilian depot workforce requirements. The centers’ depot
                          workforce requirements are forwarded through the centers for approval
                          and review up the chain of command.

Marine Corps              The Logistics Bases, a subordinate command of the Marine Corps Materiel
                          Command, is responsible for identifying depot maintenance requirements
                          and workloading at the Marine Corps’ two maintenance depots. Annually,
                          once depot maintenance requirements and related funding are identified,
                          the two centers begin the process for determining the total number of
                          workers to support the workload—including direct labor and indirect
                          labor workers. The centers send their staffing requests back up the chain
                          of command for review and approval. Revisions to staffing requests can
                          occur as a result of the centers past performance, other evolving workload
                          information, and staffing information. Once the centers have an approved
                          staffing level, they establish plans and take actions to size and reshape the
                          workforce to support workload. Such actions include, among others,


                          Page 24                                GAO-03-472 DOD Depot Workforce Planning
            identifying skills needed to support the workload; developing hiring plans
            to recruit new workers and training plans for new and existing workers
            to develop and enhance critically needed skills; or if staffing levels are
            reduced, identifying measures to accomplish the assigned workload such
            as increased use of overtime; or, if necessary, reducing the number of
            depot workers.

Air Force   In early 2000, the Air Force Materiel Command, which has management
            and oversight responsibility for the four Air Force maintenance depots,
            developed and institutionalized workforce shaping processes to assist
            depot managers in planning and achieving their overall workforce
            objective. That objective is to obtain by fiscal year 2005 a trained,
            flexible workforce of sufficient size with the appropriate mix of skills
            and expertise to accomplish the depot mission. A key aspect of the
            command’s workforce planning process is the development of accession
            or hiring/appointment data. The command requires the depots to provide
            annual accession data in order to determine the number of potential
            vacancies by job series that each center is likely to experience in the
            current and the next 5 fiscal years. The command, in turn, applies a
            probability loss model to produce out-year accession numbers using
            attrition and retirement rates and other loss data, such as separations
            and deaths, for each depot by occupational job series. The final accession
            numbers basically become the depots “hiring plan.”

            According to depot officials at each center we visited, change in the
            mission workloads is just one of many factors used in computing future
            accession requirements. They further stated that as a general rule,
            projected accessions are based primarily on current workloads and
            attrition rates rather than on future workload estimates. According to
            these officials, because the Air Force depot maintenance strategic plan
            does not identify new work to be performed in the depots, they cannot
            predict with a high level of confidence what their expected workload
            volumes will be more than 2 or 3 years out. Depot officials told us that
            their projected accession numbers beyond 2 or 3 years are their best
            guess. In addition, the depots annually conduct a bottoms-up workforce
            review to ensure that their civilian workforce is the right size and aligned
            to meet identified workload requirements. If properly done, the workforce
            planning process provides management with the needed data to make
            sound workforce decisions from implementing effective recruitment and
            retention programs, to developing valuable training programs, and to
            arranging for successful accession management.




            Page 25                                GAO-03-472 DOD Depot Workforce Planning
Some Depot Workforce                                   Depot workforce planning, as done by the services’ depots, generally
Planning Efforts Lack                                  does not address elements of three steps identified by OPM and
Competency Assessments,                                high-performing organizations as key to effective workforce planning:
                                                       (1) the assessment of competencies needed to address skill gaps;
Comprehensive Retention                                (2) the development of comprehensive retention plans; and (3) the
Plans, and Evaluative                                  implementation of performance measures to evaluate the success of the
Performance Measures                                   workforce plans. Table 1 provides an assessment of the status of service
                                                       depots’ short-term workforce planning efforts in nine key areas of the
                                                       five steps in strategic workforce planning. (See also appendix III.)

Table 1: Status of Service Depots’ Short-Term Workforce Planning Efforts

                                                                                                                           Comprehen-              Evaluate
                       Human                       Assessed                     Recruiting                                 sive                    plans
 Service/              capital        Vision &     Competen-        Gap         and/or           Training       Succession retention               and
                                                       a
 depot type            goals          objectives   cies             analysis    hiring plans     plans          plans      plans                   adjust

 Army
 Depots                √              √                             √           √                √              √                                  √
 Arsenals              √              √                             √           √                √              √
 Ammo                  √              √                             √           √                √              √
 Plants
 Navy
 Aviation              √              √                             √           √                √              √                                  √
 Depots
 Shipyards             √              √                             √           √                √              √                                  √
                       √              √            √                √           √                √              √                                  √
                                                   b
 Naval
 Surface and
 Undersea
 Warfare
 Centers
 Space and             √              √                             √           √                √              √                                  √c
 Naval
 Warfare
 Systems
 Centers
 Marine Corps          √              √            d
                                                                    √           √                √              √                                  √
                       √              √            √                √           √                √              √                                  √
                                                   b
 Air Force
Source: DOD (data), GAO (analysis).

                                                       Note: √ Checkmark indicates efforts under way to address elements in these steps.
                                                       a
                                                        All the services and depots assessed their skills to address gaps relative to the future workforce
                                                       requirements.
                                                       b
                                                        The Naval Surface Warfare Center and the Air Forces’ Directorates of Maintenance at Ogden Air
                                                       Logistics Center, Oklahoma City Air Logistics Center, and Warner Robins Air Logistics Center did not
                                                       assess competencies.
                                                       c
                                                           Space and Naval Warfare Systems Center San Diego did not have performance measures.




                                                       Page 26                                              GAO-03-472 DOD Depot Workforce Planning
                          d
                           The Marine Corps reported that it has an initiative underway to study establishing competencies and
                          career paths for its logistics and facilities communities. However, the results of that initiative have not
                          been published.




Most Depots Did Not       Although one Naval Undersea Warfare Center and the Air Force’s
Separately Assess         Aerospace Maintenance and Regeneration Center assessed competencies,
Competencies Needed for   most depots have not assessed the competencies—a set of behaviors that
the Depot Workforce       encompass skill, knowledge, abilities, and personal attributes that are
                          critical to successful work accomplishment;16 competencies can identify
                          where gaps exist in the skills of the current depot workforce relative to
                          those needed in the future.

                          As shown in table 1, most depot officials did not usually separately assess
                          competencies for depot workers, relying instead on job skills, series, or
                          classifications. Workforce planning models, however, suggest that the
                          assessment of competencies provides more than is discussed in position
                          descriptions. A survey of several top-performing organizations suggests
                          that a better approach is to conduct an actual assessment of employees’
                          competency levels. An actual assessment will provide much more useful
                          information for determining the number of those available and capable of
                          fulfilling future functional requirements. It can also give good information
                          as to what recruitment, training, and other strategies will be needed to
                          address workforce gaps and surpluses.

                          Workforce planning models point out the need for identifying
                          competencies. For example, the required competencies identified for
                          GAO analysts include, among others, thinking critically, improving
                          professional competence, achieving results, collaborating with others,
                          and facilitating and implementing change. According to the state of
                          Washington’s Workforce Planning Guide, competencies provide
                          management and staff with a common understanding of the skills and
                          behaviors that are important to the organization and the accomplishment
                          of its mission.

                          Although most depots did not assess competencies separately for their
                          depot workers, a couple of depots did competency assessments, with one
                          depot doing competency assessments for its entire workforce and one



                          16
                            As defined by several state and federal agencies such as the Washington State
                          Department of Personnel, New York State Department of Civil Service, and the
                          U.S. Departments of Interior and Health and Human Services.




                          Page 27                                                GAO-03-472 DOD Depot Workforce Planning
                                  doing an assessment for only a segment of its workforce. The Naval
                                  Undersea Warfare Center identified the following competencies in its
                                  assessment: innovative thinking, situational leadership, managing a diverse
                                  workforce, conflict management, interpersonal/team skills, technical
                                  competence, problem solving, and oral and written communications.
                                  According to warfare center personnel, these attributes are critical to the
                                  successful achievement of its mission and goals.

                                  Additionally, the Air Force’s Aerospace Maintenance and Regeneration
                                  Center developed a supervisor’s needs assessment that identified
                                  supervisor competencies. They included integrity, communication,
                                  listening, empowering others, accepting responsibility, planning, being
                                  a team player, dependability, consistency, fairness, and effective
                                  prioritization. These competencies resulted in the development of a
                                  core-training curriculum for supervisors.

Services Lack Comprehensive       Although all of the services had some retention strategies to ensure
Retention Plans                   continuity of leadership and for keeping high performing and highly skilled
                                  personnel, none have comprehensive retention plans to further enhance
                                  these strategies.

                                  According to OPM, an important principle behind maintaining a quality
                                  workforce is employee retention. A critical analysis of workforce trends
                                  is essential to determine what factors most affect retention. Current
                                  workforce research has identified the following factors as being critical
                                  to enhancing the retention necessary for the construction of a high
                                  performance organization: diversity, career development and
                                  advancement, work life balance, recognition, employee benefits,
                                  and performance. Furthermore, OPM’s 5-Step Workforce Planning
                                  Model states that a comprehensive retention plan should

                              •   determine those employees who are critical to accomplishment of
                                  organizational goals,
                              •   develop a means to provide constant feedback between these critical
                                  employees, and supervisors/managers to determine what they want and
                                  need to become long-term assets of the organization, and
                              •   develop a means of providing incentives and/or working conditions
                                  designed to retain valued employees.

                                  Most activities we evaluated had developed a means of providing
                                  incentives designed to retain valued employees. However, only the Air
                                  Force identified a separate list of occupations critical to accomplishment
                                  of organizational goals, with most depots reporting that every employee



                                  Page 28                               GAO-03-472 DOD Depot Workforce Planning
                             was critical. Overall, the Naval Undersea Warfare Center and Navy
                             shipyards were further along in developing their retention plans.

                             The Naval Undersea Warfare Center at Keyport, Washington, developed
                             a personnel retention program that includes its depot workforce,
                             concentrating on (1) work and job design, (2) career progression,
                             (3) awards and compensation, and (4) quality of life. The center
                             developed the retention program to make the center a great place to
                             work. For example, the center has reinstituted new hire briefings,
                             developed an employee handbook, and initiated an improvement award
                             program to provide incentives to employees to submit new ideas for
                             process improvement.

                             The Navy’s shipyard retention strategies focus on bonuses, helper-to-
                             worker programs, recognition programs, employment development and
                             career opportunities, and leadership training. For example, the shipyards’
                             helper-to-worker programs include, among other things, academics and
                             trade theory training. Also, Puget Sound Naval Shipyard has used retention
                             incentives to pay up to 25 percent of salary to retain approximately
                             30 employees who possessed engineering and technical knowledge that
                             was critical to the shipyard’s success. Meanwhile, an Air Force depot lost
                             8 of 12 workers in a shop because the highly skilled software engineers
                             were disgruntled over not being able to get higher pay, even though their
                             skills were critical, required years to acquire, and were and are not
                             widely available.

Some Service Depots Lacked   Although workforce planning models emphasize the need for establishing
Performance Measures for     performance measures to provide a basis for evaluating workforce
Evaluating Workforce Plans   planning effectiveness, the workforce plans of some service depots did not
                             have this element.

                             The Government Performance and Results Act stresses the need for
                             establishing and using performance measures. Additionally, OPM’s 5-Step
                             Workforce Planning Model as well as some state and federal agencies
                             stress the importance of measuring the effectiveness of workforce
                             action plans as an element of effective workforce planning. Measuring
                             performance allows organizations to track the progress they are making
                             toward their goals and gives managers crucial information on which
                             to base their organizational and management decisions. Leading
                             organizations recognize that performance measures can create powerful
                             incentives to influence organizational and individual behavior. According
                             to the workforce planning guide of one high performance organization,
                             leaders should regularly review performance measurement information,


                             Page 29                              GAO-03-472 DOD Depot Workforce Planning
assess what is working and not working, and make needed adjustments to
the plan and strategies.

The Air Force depots and the naval shipyard communities did establish
measures for evaluating the effectiveness of their workforce planning
efforts. In April 2001, the Air Force Materiel Command issued a command
wide Human Resources Strategic Plan that addressed critical workforce
issues for depot maintenance workers as well as all other materiel
command personnel. The plan contained, among other things,
performance measures and milestones for each human-resource enabling
task. For example, it identified various performance measures for the
task “Develop and Implement Methods to Attract and Recruit High-quality
Employees.” They included, among others, determining whether
milestones had been completed on time and whether appropriate
actions had been taken after analysis of data from new employees’
entrance surveys.

The Naval Sea Systems Command also developed performance measures
for evaluating the effectiveness of workforce plans for Navy shipyard
personnel. Performance measures for the Navy’s shipyards include, among
others, measuring the success of the hiring process by comparing actual to
planned hires. Also, shipyards track the average age to determine whether
the effect of workforce plans is lowering the average age of the overall
shipyards’ workforce. Furthermore, evaluations of shipyards’ training
plans include post training evaluations and review of the budgeted training
funds expended.

Some Army depots and arsenals and one naval depot have not established
performance measures for evaluating the effectiveness of workforce
plans. Army and Navy officials said they did not develop such performance
measures because their focus was on various business metrics that
assessed the cost, schedule, and performance of their depot operations.
However, while those metrics provide details about depot operations and
worker productivity, they provide little insight into the progress being
made toward achieving workforce goals and objectives.

Performance measures are an important element of workforce planning.
Without establishing and using performance measures, managers will
likely not be able either to evaluate the progress made toward the
attainment of workforce planning goals relative to recruiting, hiring,
training, retention, and succession or to measure the workforce’s
contribution toward achieving programmatic goals.



Page 30                               GAO-03-472 DOD Depot Workforce Planning
                           The services’ depots face a number of challenges that adversely affect
A Number of                DOD’s strategic workforce planning for the viability of its civilian
Challenges Inhibit         workforce. First, the services may have difficulty maintaining the depots’
                           long-term viability by replacing up to 31,000 skilled depot workers, if these
Effective Strategic        workers retire when they are eligible by 2009. Second, the services are
Workforce Planning         having difficulty implementing multiskilling—having one worker capable
                           of performing more than one skill, or trade, in the depot—which has been
                           shown to improve worker efficiency and productivity and could help the
                           depots do more with less. The Navy and the Air Force have attempted
                           to implement multiskilling but are having difficulty because additional
                           compensation or other financial incentives have not been approved or
                           are not available. Lastly, the need for increased training funding and
                           innovation for workers who replace the large number of potential retirees
                           will also pose a challenge. The Air Force is already facing unfunded
                           training costs for its depot workers.


Difficulty Maintaining     As a result of depot downsizing, the DOD civilian depot workforce has
Depot Viability if Large   about 31,000 personnel eligible to retire over the next 5 to 7 years.17 This
Numbers of Eligible        creates a challenge for the depots in retaining their viability, assisting
                           service readiness, and revitalizing their workforces.
Skilled Workers Retire
                           Table 2 provides age and retirement eligibility information for the
                           27 DOD industrial facilities. The average age ranges from 44 in the
                           McAlester, Oklahoma, ammunition plant and 45 in three naval shipyards
                           (where officials have actively worked to lower the average age), to 52 in
                           the San Diego Space and Naval Warfare Systems Center and the Air
                           Force’s Aerospace Maintenance and Regeneration Center. In Army
                           maintenance depots, where the average age is 49, depot officials said it is
                           difficult to bring down the average age because there are not many new
                           hires and some of those hired tend to be older employees.




                           17
                             Retirement projections were based on date the employee becomes eligible for
                           optional retirement under the Civil Service Retirement System or the Federal Employees
                           Retirement System.




                           Page 31                                      GAO-03-472 DOD Depot Workforce Planning
Table 2: Civilian Personnel in Industrial Facilities Eligible to Retire

                                                             FY 2002                Number of
                                                              civilian                civilians           Percent Percent eligible
                                                             staffing Average eligible to retire eligible to retire   to retire by
 Defense industrial facilities                                 levels     age       in FY 2002        by FY 2007         FY 2009
 Navy depots
 Cherry Point Aviation Depot                                   3,839        46               99               24               34
 Jacksonville Aviation Depot                                   3,928        48              133               27               37
 North Island Aviation Depot                                   3,138        49              109               31               43
 Norfolk Naval Shipyard                                        7,525        45              527               27               38
 Portsmouth Naval Shipyard                                     3,500        46              251               30               41
 Puget Sound Naval Shipyard                                    8,608        45              676               28               38
 Pearl Harbor Naval Shipyard                                   3,987        45              122               27               38
                                     a
 Crane Naval Surface Warfare Center                              311        45               10               32               40
 Keyport Naval Undersea Warfare Center                           608        48               26               41               55
 Charleston Space and Naval Warfare Systems Center                49        51                5               47               59
 San Diego Space and Naval Warfare Systems Center                 70        52                1               43               47
 Total Navy                                                   35,563                      1,959
                 b
 Army facilities
 Anniston Army Depot                                           2,429        48              408               48               60
 Corpus Christi Army Depot                                     2,869        49              223               22               27
 Letterkenny Army Depot                                        1,082        49              147               46               59
 Red River Army Depot                                          1,478        48              203               42               55
 Tobyhanna Army Depot                                          2,237        49              502               58               72
 Rock Island Arsenal                                           1,156        50               82               36               41
 Watervliet Arsenal                                              484        50               28               42               61
 Pine Bluff Arsenal                                              804        49               89               43               63
 Crane Army Ammunition Activity                                  620        49              181               49               60
 McAlester Army Ammunition Plant                               1,075        44              226               30               48
 Total Army                                                   14,234                      2,089
 Marine Corps depots
 Maintenance Center Albany                                        659       48              128               47               64
 Maintenance Center Barstow                                       664       47              118               43               56
 Total Marine Corps                                             1,323                       246
                    c
 Air Force depots
 Aerospace Maintenance and Regeneration Center                   439        52              139               65               77
 Directorate of Maintenance, Ogden ALC                         5,852        47            1,015               39               49
 Directorate of Maintenance, Oklahoma City ALC                 8,533        45            1,167               33               41
 Directorate of Maintenance, Warner Robins ALC                 6,328        45              988               33               41
 Total Air Force                                              21,152                      3,309
                                                                             d
 Total Defense industrial facilities                          72,272       48             7,603               33               43
Source: DOD (data), GAO (presentation).




                                             Page 32                                    GAO-03-472 DOD Depot Workforce Planning
    a
        Staffing level as of November 2001.
    b
     Army industrial facilities include depots, arsenals and government-owned and–operated ammunition
    plants.
    c
        Air Force data as of September 30, 2001.
    d
        Total weighted average age based on the number of civilian staff at each industrial facility.


    As table 2 shows, about 7,600 employees in these activities—about
    12 percent of the total workforce—were eligible to retire in fiscal year
    2002. However, depot officials told us they cannot hire replacement
    workers until the vacancies occur. Given that years of experience are
    required to get the average worker to a journeyman level, these officials
    are concerned about the impact on depot operations of trying to replace
    large numbers of workers during a short time period. This situation will be
    aggravated during the next few years as the number of workers eligible to
    retire increases significantly. For example, the percent eligible to retire by
    fiscal year 2007 ranges from a low of 22 in one Army depot and 24 in one
    naval aviation depot to a high of 65 percent at one Air Force depot and
    58 at one Army depot. In 2009, 77 percent of the workers will be eligible
    to retire at one Air Force depot, 72 percent at one Army depot, and
    64 percent in one Marine Corps depot.

    Air Force officials said they expect to hire 13,000 depot workers by
    September 2009 to replace retiring workers. They expect to encounter
    difficulties during that process, similar to those they experienced when
    they hired approximately 4,500 workers during the last 2 years (primarily
    as a result of Base Realignment and Closures and transfers). Those
    difficulties included the following:

•   engineering positions were particularly difficult to fill, and the use of
    pay incentives to increase salary levels of engineers and other hard-to-fill
    positions was essential;
•   some qualified and desirable potential employees went elsewhere because
    the hiring process took too long;
•   new hires were not “shop ready” when they come in the door and needed
    additional training; and
•   more supervisors are needed to manage the new workers.

    According to officials at the Air Force’s Directorate of Maintenance,
    Ogden Air Logistics Center, workers in one software engineering shop
    became discouraged at not getting additional pay and 8 out of 12 quit and
    went to work for a local contractor. Unable to fill these highly skilled
    positions or otherwise get the work accomplished in the depot, the depot
    hired the contractor to do the work formerly done in the depot at a


    Page 33                                                 GAO-03-472 DOD Depot Workforce Planning
considerably higher cost than was incurred when the work was done in
the depot.

Army officials noted that a higher average age does not necessarily equate
to high retirement eligibility. For example, workers at the Corpus Christi
depot have an average age of 49, but the number of workers eligible to
retire by 2009 is 27 percent—the lowest of any depot. According to
Corpus Christi depot officials, during the mid-1980s they hired about
1,700 workers in their mid-30s, many of which were ex-military.
Additionally, Army officials noted that many depot workers continue to
work after they are eligible to retire. Nonetheless, Army depot officials
recognize that with about 52 percent of the depot workforce eligible to
retire by 2009, it will be difficult to maintain a viable, trained workforce
if the retirement eligible employees choose to retire over a short period
of time.

We analyzed Army retirement eligibility data for the Army depot
workforce and observed that some work centers could lose a majority
of their staff within the next 5 years. Depot officials acknowledged that
some work centers are at risk if all or most of the workers leave during a
short period of time and that realignments, or job transfers, are needed to
make sure a large number of retirement eligible employees are not
assigned to any one area. However, the depots have limited plans to deal
with this situation. They said they cannot hire replacement workers until
after an employee retires. Additionally, transfers to balance retirement
eligible employees could be unwelcomed by personnel and could have an
adverse impact on shop productivity, as workers require time to gain skills
in new areas. It will be a major challenge to balance such concerns about
current operational impacts and increased training now against longer
term concerns about retirement eligibility over the next 5 to 7 years.
However, the depots are generally not making such analyses
and trade-offs.

According to Marine Corps depot officials, attrition rates are low and the
centers have hired few new permanent employees. However, the percent
of employees eligible to retire will increase from 43 and 47 percent in 2007
to 56 and 64 percent in 2009. Officials said it would be difficult to bring
on such large numbers of new workers if these retirement-eligible
personnel do retire about the same time. However, the centers’ workload
has declined significantly in the past. Systems that used to comprise the
bulk of the centers’ work are phasing out of the inventory, and questions
remain about whether replacement systems will be maintained in the
Marine Corps depots or the private sector. Officials acknowledged that it


Page 34                                GAO-03-472 DOD Depot Workforce Planning
                          is difficult to plan for the revitalization of the center workforce without
                          knowing what work will be available for them to do.

                          An aging workforce has some advantagesparticularly when the
                          workload is relatively stable over time. Officials pointed out that as
                          DOD was downsizing its depot workforce and doing no new hiring, there
                          were fewer demands for training programs. About half of the depots
                          have apprenticeship programs, which are the most comprehensive and
                          expensive type of training for industrial workers. Some of these programs
                          have been re-established in the past few years. Nonetheless, according to
                          depot officials, it would be unaffordable to hire enough apprentices to
                          replace the large numbers of workers who will be eligible to retire over the
                          next 5 to 7 years.


Difficulty Implementing   The services are having difficulty implementing or are not trying to
Multiskilling Even        implement multiskillinga private-sector initiative designed to improve
Though It Could Improve   the flexibility, efficiency, and productivity of workers. Multiskilling is the
                          process of training maintenance employees in specific skills that cross the
Worker Efficiency         traditional trade or craft lines and then ensuring the work is performed. It
and Productivity          involves reviewing work processes to identify situations where efficiency
                          and productivity can be enhanced by training workers in one skill area or
                          occupational series to perform some tasks in another occupational series.
                          A major advantage of multiskilling is that particular jobs that require more
                          than one craftnot necessarily more than one individualcan be
                          performed by fewer personnel. It can reduce the time it takes to perform
                          jobs involving multiple skill requirements by eliminating the time a depot
                          worker must wait for another worker to arrive and perform a task that the
                          first worker is not trained to do. For example, an aviation mechanic
                          trained in certain electrical tasks can reduce the times an electrician must
                          be called when doing aircraft repair.

                          In a 1998 review of Army industrial facilities we pointed out inefficiencies
                          in the depots and arsenals and stated that improved systems and
                          procedures for shifting maintenance workers between different
                          organizational units and skill areas would offer better opportunities to
                          effectively use limited numbers of maintenance personnel.18 Depot



                          18
                            U.S. General Accounting Office, Army Industrial Facilities: Workforce Requirements
                          and Related Issues Affecting Depots and Arsenals, GAO/NSIAD-99-31 (Washington, D.C.:
                          Nov. 30, 1998).




                          Page 35                                    GAO-03-472 DOD Depot Workforce Planning
                            officials had noted that prior practices made it difficult to transfer workers
                            between organizational units and skill areas to adjust for unanticipated
                            work stoppages caused by changes in work priorities, parts shortages,
                            technical problems, or temporary labor imbalances. We pointed out that
                            multiskilled workers offered added flexibility and could allow depot
                            managers to use a limited number of workers more cost effectively. We
                            recommended that the Secretary of the Army encourage depot managers
                            to pursue worker agreements to facilitate multiskilling in industrial
                            facilities. Although the Army has not been successful in implementing
                            multiskilling, this initiative remains a goal Army depot planners would like
                            to pursue.

                            In recent years, the naval aviation community has done the most to begin
                            using multiskilling as a depot improvement initiative, but full project
                            implementation has been delayed because they have not been given
                            permission to allow an additional pay grade for workers having more than
                            one skill. Although the Air Force first tried multiskilling in 1993 and its
                            current depot improvement initiative calls for determining cost effective
                            ways to implement multiskilling, the Air Force’s multiskilling initiative is
                            also floundering. In addition, although service, depot, and other officials
                            attribute improved workforce flexibility and cost-effectiveness to
                            multiskilling, Army depots and Marine Corps centers and Navy shipyards
                            are not implementing it.

Naval Aviation Multiskill   The naval aviation community has attempted to implement multiskilling
Efforts Are Delayed         since 1999. Although its current request to pilot a multiskilling
                            demonstration project to use a certain compensation system had not been
                            approved as of March 2003, the community is implementing the pilot with
                            an alternative compensation approach.

                            As a result of an extensive business process reengineering project
                            completed in 2002, the Naval Air Systems Command identified
                            multiskilling as a solution to achieve a more flexible workforce. The
                            program is intended to provide a more flexible, multitraded, trained
                            workforce that could react more quickly to fluctuating workloads because
                            managers can reassign employees based on workload demands. According
                            to naval aviation managers, a multiskilled worker could be particularly
                            cost-effective when depot workers go to the weapon system in the field
                            rather than bringing the weapon to the depot. For example, a worker
                            trained as both a pneudraulic systems mechanic and an aircraft engine
                            mechanic could be sent to an operational location to accomplish the work
                            that previously required workers trained in each of these skills. As a result,



                            Page 36                                GAO-03-472 DOD Depot Workforce Planning
cost reductions should occur in field team assignments, which comprise
an increasing share of Navy aviation depots’ work.

The naval aviation community’s current multiskilling initiative used a
business case analysis to justify a demonstration project that would
provide training for workers who are at the journeyman level in one skill,
such as a sheet metal mechanic, to attain journeyman status in a second
trade, such as an aircraft mechanic. The project called for compensating
the workers involved by increasing their pay by an additional wage grade.19
According to Naval Air Systems Command officials, the economic analysis
indicated savings could be achieved even though the workers would
receive increased compensation. Increased throughput is expected to
result in efficiencies of up to 20 percent due to redirected travel savings
and increases in volume efficiencies. This same business case analysis
indicated that during a single year one depot could potentially accomplish
519 additional maintenance tasks for the same amount of budget.
According to depot planners, private sector workers receive increased
compensation under similar circumstances, and union officials believe
government workers should also.

However, OPM’s Job Grading Standards do not contemplate providing
compensation for an additional grade for two equal trades. OPM’s job
grading standards state that pay is based on the highest level of work
performed, regardless of how many different trades an employee is
required to perform. According to Naval Air Systems Command officials,
OPM’s standard inhibits their ability to pursue multiskilling initiatives and
achieve reengineering efficiencies.

The Naval Air Systems Command sought permission to go to OPM
to request a demonstration project with additional compensation in
September 2000; but Headquarters, Department of the Navy disapproved
the request. Based on the results of the 2002 business case analysis,
which showed that the multiskill concept would increase readiness by
providing a more flexible and well-trained workforce, in September 2002
the naval aviation community again sought approval for the proposed
demonstration project, including increased compensation.




19
  The additional grade would allow increased compensation (e.g., at wage grade 10) for
work in two equal skills (e.g., both wage grade 09) when the worker performs the functions
of the two skills for a minimum of 25 percent of the time at work.




Page 37                                      GAO-03-472 DOD Depot Workforce Planning
                                  Navy headquarters has not yet approved the request, but aviation
                                  depot officials are going forward with the project using an alternative
                                  compensation approach. They have established a compensation award
                                  at each site, not to exceed a $2,500 annual award. Five different skill
                                  combinations have been proposed for the Cherry Point Depot and two for
                                  the Jacksonville depot. One combination has begun at the North Island
                                  depot. According to naval aviation officials, workers are reluctant to
                                  participate because while in training they would not have the opportunity
                                  for overtime pay. Officials believe that getting an additional grade would
                                  be sufficient to increase the willingness of depot workers to participate—a
                                  goal that is likely critical to getting the program to sufficient numbers to
                                  make it cost-effective.

Air Force Multiskilling Program   Although the Air Force’s current depot maintenance improvement effort
Is Older but Declining            calls for determining cost effective ways to implement multiskilling,
                                  officials are generally supportive of it as a workload tool; however, the
                                  Air Force’s multiskilling program is declining in size. In 1993, the Air Force
                                  Materiel Command prototyped a multiskilling concept using aircraft
                                  mechanics at the Oklahoma City depot. The program involved training
                                  and certifying mechanics in multiple skills (aircraft, sheet metal, and
                                  electrical) that were capable of performing a series of tasks involving
                                  general airframe, structural, and electrical maintenance. By 1997, the
                                  program had over 100 participants. However, since then, depot officials
                                  told us the program has lost its popularity and currently consists of only
                                  49 participants. Officials said that due to production requirements, many
                                  of the skilled workers participating in the original project are now working
                                  in their primary skill and new hires show little interest because there are
                                  no financial incentives.

                                  At the Warner Robins depot, officials designated a specific occupation job
                                  series, 8801, as multiskilling to provide workers with greater job flexibility
                                  and a better career path. As of September 2001, 148 workers were
                                  functioning in this job series. Multiskilled workers primarily performed
                                  tasks in two occupations, such as aircraft mechanic and electrical
                                  mechanic or aircraft mechanic and sheet metal mechanic. According to
                                  depot officials, they used this occupational job series as a hiring tool to
                                  attract younger, multiskilled workers at the entry level. However, workers
                                  did not receive any additional salary.

                                  As a part of its depot maintenance improvement efforts, the Air Force has
                                  refocused on multiskilling. Officials conducted a business case analysis to
                                  determine the feasibility of various opportunities for using multiskilling at
                                  the depots. After several months of data gathering and analysis, officials


                                  Page 38                                 GAO-03-472 DOD Depot Workforce Planning
                              said they were not able to provide a strong business case for developing a
                              standardized approach or expanding the use of multiskilling at the depots.
                              We found that, except in very limited cases, the depots are not doing true
                              multiskilling today. Rather, the depots are doing something similar called
                              multicrafting that does not involve the combination of two or more skills
                              at the journeyman skill level. Despite the results of the business case
                              analysis, officials from Headquarters, Air Force Materiel Command, and
                              the depots were generally supportive of multiskilling as a tool to deal with
                              fluctuating homogenous workloads and to facilitate movement of
                              employees as workload demands fluctuate.

Multiskilling Is Cited as     Service, depot, and other organization officials cite the multiskilling
Improving Flexibility and     concept as a way to provide a more flexible, productive workforce that
Cost-Effectiveness of Depot   can react more quickly to fluctuating workloads, a key issue in trying to
and Other Workforces          improve the cost-effectiveness of maintenance operations as well as meet
                              readiness needs.

                              According to officials of the Naval Air Systems Command, the extensive
                              business case analysis they conducted indicated that multiskilling will
                              provide a trained workforce, more flexible for increased readiness, and
                              more capable of being able to be reassigned on demand to better support
                              fluctuating workloads. The officials also indicated that a multiskilling
                              program could also better support readiness by serving as an incentive to
                              skilled, near-retirement workers to stay and provide on-the-job training for
                              younger workers. In addition, depot officials reported, on the basis of the
                              economic analysis that savings would be achieved even though workers
                              would receive increased compensation.

                              Various organizations such as the Tennessee Valley Authority are
                              exempt from OPM’s job grading standards and are allowed to establish
                              a classification system that is more flexible and better fits their
                              environment. Among the flexibilities the Tennessee Valley Authority
                              has implemented is a multiskilled work force that receives additional
                              compensation for additional skills and work. The Tennessee Valley
                              Authority’s program will involve about 1,400 current employees as well
                              as new hires. According to Authority officials, multiskilling is improving
                              the flexibility and efficiency of the workforce. As North America’s
                              largest public power company, the Tennessee Valley Authority developed
                              its union agreements on multiskilling in fiscal year 2000 and fully
                              implemented its pilot program by the end of fiscal year 2001, with the
                              program expected to be fully implemented by 2005. The plan is to review
                              all preventive maintenance activities and reassign them to utilize multiskill
                              employees. Authority officials said that the multiskilling training program


                              Page 39                                GAO-03-472 DOD Depot Workforce Planning
                         is resulting in a more efficient way to accomplish their work and to obtain
                         and maintain a versatile group of employees. They reported that increases
                         in productivity and efficiency were expected to reduce restaffing after
                         attrition by about 15 percent.

                         Private sector industrial activities have also implemented multiskilling.
                         According to Naval Air Systems Command and Air Force officials, they
                         did benchmarking in the private sector before they began trying to put
                         together their own multiskilling programs. Navy depot officials also noted
                         that they see increased usage of this concept when they do private sector
                         wage grade comparability studies.


Need for Increased       Based on the potential retirement of about 31,000 depot workers out of the
Funding and Innovation   approximately 72,000 workers in the workforce eligible to retire by 2009,
Driven by Increased      training requirements will increase significantly for new hires, and
                         innovation will be required to develop more cost-effective training
Training Requirements    alternatives. For over 10 years, most depots had training costs much
                         smaller than would normally be required for industrial activities since
                         depot downsizing resulted in hiring few new employees. However,
                         because the Air Force currently has a significant deficit in funding training
                         for new hires and refresher training, depot officials raised concerns over
                         their ability to fund future training requirements needed for workforce
                         revitalization. Furthermore, as the depots face the challenge of developing
                         and implementing plans to address skill imbalances occurring due to
                         attrition and retirement over the next 5 to 7 years, the need for increased
                         funding will likely drive the need to find new funding sources and to
                         develop innovative training programs that cost less.

                         The Air Force is already challenged by unfunded training costs. Air Force
                         workers who had received little training for years were required to take
                         “back-to-basics training.” This came about after accidents occurred at two
                         depots and additional training requirements evolved from the personnel
                         changes resulting from closing two Air Force depots and transferring
                         their work to other locations. However, although training requirements
                         increased, training budgets have not kept pace. For example, when Air
                         Force Materiel Command depot managers requested $10 million in 2001 to
                         train first-line supervisors, the Command did not approve any of that
                         funding. And when managers requested $11.5 million for budget years 2002
                         to 2007 to provide added training for new workers, the Command only
                         funded a portion of that request. Lacking sufficient training dollars to fund
                         their requirements, Air Force depot managers have been seeking ways to
                         partner with state government programs. Partnering with the states to


                         Page 40                                GAO-03-472 DOD Depot Workforce Planning
develop training programs and curriculum for co-op students at high
schools, vocational technical colleges, and universities was a cost-effective
strategy that enabled depots to hire certified and credentialed workers to
replace retirees. For example, the Warner Robins and Oklahoma City
depots are working primarily with the states of Georgia and Oklahoma to
establish training programs with local community colleges and high
schools so that new hires will be trained and certified as Federal Aviation
Association Aircraft and Power Plant license holders. Each of the Air
Force depots is developing courses to groom the next generation of
leaders and managers. But according to depot planners, much more needs
to be done and where the funding is to come from is unclear. This is
particularly true as the Air Force plans for the potential retirement of 43 to
52 percent of its depot workforce over the next 5 to 7 years.

The other service depots are also experiencing challenges in funding
training as they begin to hire new employees after years of downsizing.
About half of the depots provide new industrial workers with training
through apprentice programs. The Air Force and one Marine Corps
center are using cooperative education programs, because they believe
apprenticeship programs, which take 3 to 4 years to qualify workers for
becoming journeymen-level workers, are too expensive. The Army
Materiel Command estimated that $7.9 million was needed to sustain
79 apprentices already in the program and to add 50 additional apprentices
for fiscal year 2002, or about $55,000 for each apprentice. However, the
Command did not receive this level of funding, which caused the
Command to transfer the costs to the depots as a cost of their operations.
Army Materiel Command reported that it has requested additional funding
for the apprentice program to support an average of 184 apprentices each
year for the 7-year period, fiscal years 2003 through 2009. Army depot
officials said that the program was too small in number to significantly
impact future worker needs. In addition, without the Army directly
funding the program costs; customers pay for depot services will increase,
which could lead to a loss of customer support. Two of the five Army
maintenance depots decided that no additional apprentices will be
accepted into the apprenticeship program unless the program can be
directly funded.

In confronting the human capital challenge of revitalizing the depot
workforce, the services have the opportunity to develop innovative
training programs that cost less and to identify new funding sources for
training. According to Navy and Air Force officials, centralized training
programs and centralized funding could be considered cost-effective
ways to support depot revitalization. Officials also noted that centralized


Page 41                                GAO-03-472 DOD Depot Workforce Planning
              training programs would help ensure consistency in the quality of training
              provided to depot workers. Also, centralized funding would be another
              source of funding and would provide centralized oversight and
              accountability over how the funds are disbursed.


              Continued shortfalls in DOD’s strategic planning process, including the
Conclusions   lack of a DOD depot strategic plan and a strategic plan for arsenals and
              ammunition facilities have created questions regarding the future of the
              72,000 civilians in the depot maintenance, arsenal, and ammunition
              manufacturing plant workforce and their ability to support future military
              operations. Without a strategic perspective that complements the
              department’s overall mission and objectives, the services do not have
              the long-term visibility they need to ensure the continued performance
              of these important support missions. When this is coupled with DOD’s
              adoption of increased contracting of work to the private sector, the future
              role of these industrial facilities and their workforce is clearly in doubt.
              The situation is compounded by questions regarding DOD’s
              implementation of the core maintenance statute, which is an essential
              feature in defining the depot workforce of the future. While in some
              cases the services have made a start at defining future objectives for the
              industrial facilities that are centered around the development of
              public-private partnerships, it is unclear how these partnerships should
              be folded into future industrial facilities planning. Further, without a
              departmental approach that has been approved by the Congress,
              future depot planning will continue to be fragmented, inconclusive, and
              inefficient. Since we have previously recommended that DOD develop a
              depot strategic plan, we are not repeating that recommendation in this
              report. However, we continue to believe a depot strategic plan is needed
              and we will continue to follow DOD’s progress toward implementing one.

              The absence of strategic guidance regarding the future of the DOD
              industrial facilities has generally prevented the development of
              comprehensive strategic workforce plans that are required for effectively
              managing DOD’s 72,000 civilian industrial facilities workers to meet the
              challenges of the future. For example, without having long-term strategies
              for acquiring, developing, and retaining their workforce that are clearly
              linked to achieving programmatic goals, the services continued to
              downsize these activities without a vision for what capabilities would be
              required in the future. The result of downsizing is that the remaining depot
              maintenance workforce averages 47 years of age and has skill imbalances.
              With workload in some activities continuing to decline and with
              uncertainties about new work for the future, officials in depots, arsenals,


              Page 42                                GAO-03-472 DOD Depot Workforce Planning
and ammunition plants are uncertain whether they should plan to replace
retiring workers and about what skills will be needed in the future.
Furthermore, the industrial planners, in their short-term planning,
have followed some but not all of the steps identified by OPM and high
performing organizations, with the naval shipyard community and
Air Force more comprehensive in their workforce planning approaches.
However, the planners, have not, in general, identified competencies,
developed comprehensive retention plans, or evaluated the performance
of workforce planning efforts and taken corrective actionsall best
practices that could help depots more effectively meet current and
future challenges.

A number of challenges confront DOD’s workforce planning for the
revitalization of this industrial workforce, about 12 percent of which are
eligible to retire in fiscal year 2002 and about 43 percent of which will be
eligible to retire by 2009. First, workforce planning efforts, which are
generally focused on the short-term, do not address the potential loss of
a third to over 40 percent of the depot workforce over a short period of
time, a challenge that could threaten the depots’ viability. Only the Air
Force has taken action to ensure the continued viability of its depots in
2007 and beyond. Secondly, the current occupational series may not be
the best to most efficiently perform required maintenance operations.
Multiskilling, which has been successfully implemented in the private
sector and in some government activities, has flexibilities unavailable to
most government activities. However, depot activities trying to implement
the flexibilities have been confronted by rules that do not allow providing
an additional grade for performing work in additional skill areas. While
the naval aviation community is trying an approach that would use a
bonus rather than additional pay, naval aviation officials believe the
additional flexibilities are still needed. We also believe that if it proves to
be cost-effective, the full option of providing an additional grade would
help ensure the greatest potential for success. Finally, with the large
number of workers eligible to retire by 2009, training requirements and
funding for training will increase significantly for new hires. Further, the
need for increased funding for training will likely drive the need to find
new funding sources and to develop cost-effective training programs. A
centralized DOD depot training program could be a very practicable way
to introduce more innovative and cost-effective approaches to producing
and funding the required training to support depot revitalization, if the
department intends to continue using the depots as an important part of its
industrial base.




Page 43                                 GAO-03-472 DOD Depot Workforce Planning
Recommendations for   To improve the management and direction of DOD’s strategic planning for
                      maintenance depots, we recommend that the Secretary of Defense direct
Executive Action      the Deputy Under Secretary of Defense for Logistics and Materiel
                      Readiness to

                  •   complete the revisions to DOD’s core policy and develop a schedule
                      for the services to complete the computation of core requirements;
                  •   require the service secretaries and the Commandant of the Marine Corps
                      to develop revised core capabilities to provide a baseline for defining
                      workloads that should be performed in government facilities by
                      government personnel; and
                  •   require the service secretaries and the Commandant of the Marine Corps
                      to develop, or complete the development of, and implement strategic plans
                      that are linked to the services’ mission and objectives and the Office of the
                      Secretary of Defense’s depot strategic plan when it is developed and that
                      delineate industrial workloads to be accomplished in each service’s
                      depots, other service’s depots, by contractors at their own sites and at
                      government sites and using partnerships and identify the workforce
                      requirements to support the performance of this work.

                      To improve the management and strategic direction of DOD’s strategic
                      planning for arsenals and ammunition plants, we recommend that the
                      Secretary of Defense require the Deputy Under Secretary of Defense for
                      Acquisition, Technology, and Logistics to develop a strategic plan that
                      provides guidance and a schedule for identifying long-term capabilities to
                      be provided by the private sector, those to be provided in government-
                      owned and -operated plants; and those to be provided in government-
                      owned and contractor-operated plants.

                      To improve the quality and comprehensiveness of the services’ workforce
                      planning efforts, we recommend that the Secretaries of the services and
                      the Commandant of the Marine Corps develop strategic workforce plans
                      that include improvements in areas identified in this report as being
                      deficient, such as assessing workforce competencies required for the
                      current and future workforce; implementing action plans that include
                      comprehensive retention plans; and establishing performance metrics to
                      use in evaluating workforce planning efforts and a mechanism for
                      performing assessments of prior workforce planning efforts. The strategic
                      workforce plans should be linked to DOD’s strategic plan for depot
                      maintenance and the strategic plan for arsenals and ammunition plants
                      when they are developed.




                      Page 44                                GAO-03-472 DOD Depot Workforce Planning
                         To improve DOD’s strategic workforce planning to ensure the viability of
                         its depot maintenance workforce, we recommend that the Secretary of
                         Defense require the Under Secretary of Defense for Personnel and
                         Readiness, in coordination with the Deputy Under Secretary of Defense
                         for Logistics and Materiel Readiness, to coordinate the implementation of
                         an initiative to

                     •   provide guidance for developing workforce revitalization strategies and
                         strategic plans to address expected depot attrition over the next 5 to 7
                         years;
                     •   provide options for incorporating multiskilling into depot workforce
                         planning initiatives; and
                     •   implement a working group to explore options for innovative and cost-
                         effective training and to explore appropriate funding alternatives, to
                         include centralized funding, to revitalize the depot workforce.

                         Given the difficulties the Department of Defense is having implementing
                         multiskilling and its potential for improving the flexibility and productivity
                         of the department’s maintenance workforce, we recommend that the
                         Secretary of Defense require the Under Secretary of Defense for Personnel
                         and Readiness to implement a demonstration project that would give the
                         military depots the flexibility to provide additional compensation for
                         multiskilled depot workers when the services have demonstrated by a
                         cost-benefit analysis the benefits of such a program.



                         The Department of Defense reviewed a draft of this report and provided
Agency Comments          oral comments from the Office of the Undersecretary of Defense for
and Our Evaluation       Personnel and Readiness. The department concurred with seven of our
                         nine recommendations dealing with the need for completion of the
                         identification of core depot maintenance requirements and capabilities
                         and for improved strategic planning and workforce planning for depots,
                         arsenals, and ammunition plants. The department did not concur with our
                         recommendation to implement a working group to explore (1) options
                         for innovative and cost-effective training and (2) appropriate funding
                         alternatives to help revitalize the depot workforce. Also, the department
                         did not concur with our recommendation to implement a demonstration
                         project for multiskilling.

                         The department’s comments noted that the importance of human capital
                         strategic planning was clearly recognized in the Quadrennial Defense
                         Review, is the first item on the President’s Management Agenda, and is a



                         Page 45                                GAO-03-472 DOD Depot Workforce Planning
top priority for the department. Further, in early 2003, the department
published its FY 2003 Year of Execution Plan as an Annex to the integrated
DOD Civilian Human Resources Strategic Plan, and focuses on seven goals
to direct and improve all aspects of human capital strategic planning. We
recognize that the high-level strategic planning efforts undertaken by the
department are a necessary first step, but we also believe that much more
needs to be done to assure that successively lower levels of organizations
and activities accomplish complementary human capital planning that
addresses specific issues that may be of concern for a given subset of the
department’s population, such as for the workers in the department’s
industrial activities.

DOD agreed with our recommendation that the department complete
revisions to DOD’s core policy and our recommendation to develop
revised core capabilities that provide a baseline for defining workloads
that should be performed in government facilities by government
personnel. Officials noted that the department is finalizing required
changes to its revised methodology and, upon completion, will task
the military services with computing their depot maintenance core
requirements. Regarding our recommendation, to develop depot strategic
plans that are linked to the services’ mission and objectives and to the
Office of the Secretary of Defense’s depot strategic plan when it is
completed, DOD officials concurred, noting that in some cases it may be
more practical to include these plans as part of a logistics or systems
command strategic plan. DOD agreed with our recommendation to
develop a strategic plan that provides guidance and a schedule for
identifying long-term capabilities for arsenals and ammunition plants.
DOD also agreed with our recommendation to improve the quality and
comprehensiveness of the services’ workforce planning efforts. DOD
partially concurred with our recommendation to provide guidance for
developing workforce revitalization strategies and strategic plans to
address expected depot attrition over the next 5 to 7 years. Officials
said that the department developed the DOD Civilian Human Resources
Strategic Plan2002-2008 to ensure a DOD-wide civilian workforce
capable of responding rapidly, efficiently, and effectively to mission
requirements. However, they agreed that a near-term strategic plan is
needed at the depot level. We do not believe that the human resources
strategic plan cited in DOD’s response provides the required guidance for
developing workforce revitalization strategies and strategic plans and
supporting the other issues we noted in our recommendation because it is
at a higher level and does not address issues that need to be dealt with for
this work force group, such as how to provide affordable technical
training for large numbers of blue-collar workers. Additionally, to be


Page 46                                GAO-03-472 DOD Depot Workforce Planning
useful in supporting revitalization of the depot workforce, a depot
strategic plan should address long-term as well as near-term requirements.

Regarding our recommendation that the department develop options
for incorporating multiskilling into depot workforce planning initiatives,
the department concurred, stating that its proposed National Security
Personnel System will provide personnel flexibilities designed to address
multiskilling requirements. However, the National Security Personnel
System is a proposed change to the current personnel system that DOD
has requested the Congress to consider as a part of a large and diverse
DOD transformation legislative proposal. Because the Congress has not
yet acted on the department’s transformation proposal, we believe that it
is premature to assume that Congress will approve this new personnel
system. We continue to believe that whether or not the new personnel
system is approved, the depots need options for incorporating
multiskilling into depot workforce planning initiatives.

DOD nonconcurred with our recommendation to implement a working
group to explore (1) options for innovative and cost-effective training and
(2) appropriate funding alternatives to help revitalize the depot workforce.
The department stated that a working group is not necessary to explore
options already offered by new authorities and flexibilities in the proposed
National Security Personnel System. Because the proposed new personnel
system has not yet been considered by the Congress, we believe that is
premature to assume that it will be implemented, and we continue to
believe that a working group’s exploration of options would benefit depot
workforce revitalization.

DOD also nonconcurred with our recommendation regarding the
implementation of a demonstration project that would give the military
depots the flexibility to provide additional compensation for multiskilled
depot workers when the services have demonstrated by a cost-benefit
analysis the benefits of such a program. Again, the department’s
response assumes the flexibilities and authorities expected from the
proposed National Security Personnel System will cover the problems
multiskilling is intended to address. As with our comments on the prior
recommendations, we believe that this response is premature and that
independent action should be taken to implement the recommendation.

The department provided technical comments that have been
incorporated when appropriate.




Page 47                               GAO-03-472 DOD Depot Workforce Planning
We are providing copies of this report to the Secretary of Defense; the
Secretaries of the Army, Navy, and Air Force; the Commandant of the
Marine Corps; and the Director, Office of Management and Budget. We will
make copies available to others upon request. In addition, the report will
be available at no charge on the GAO Web site at http://www.gao.gov.

If you or your staff have questions regarding this report, please contact me
on (202) 512-5559 or stewartd@gao.gov or Julia Denman at (202) 512-4290
or denmanj@gao.gov. Major contributors to this report are listed in
appendix V.




Derek B. Stewart
Director
Defense Capabilities and Management




Page 48                               GAO-03-472 DOD Depot Workforce Planning
                Appendix I: Scope and Methodology
Appendix I: Scope and Methodology


                To determine the extent to which the Office of the Secretary of Defense
                has implemented our prior recommendation to develop and implement
                a strategic plan for depot maintenance, we interviewed officials and
                reviewed the Government Performance and Results Act to identify
                guidance on developing strategic plans and various laws providing
                guidance on the role of DOD depots.

                To determine the extent to which the services have developed and
                implemented strategic workforce plans to position the civilian depot
                workforce to meet future requirements, we interviewed officials and
                obtained and reviewed

            •   DOD’s Civilian Human Resources Strategic Plan 2002-2008 and the
                services’ strategic plans for depot maintenance where available to
                identify human capital goals, visions, and objectives and
            •   services’ and depots’ workforce plans (including recruiting/hiring plans,
                training plans, succession plans, and retention plans) to determine
                whether they had a strategic/long-term perspective or a short-term focus
                that was oriented toward the budget process.

                In analyzing the extent to which these workforce plans positioned the
                civilian depot workforce to meet future mission requirements, we
                compared the elements of the depots’ workforce plans to applicable
                workforce planning documents and guidance issued by the OPM, the
                GAO, the National Academy of Public Administration, and other federal
                and state government agencies. Based on our analyses, we identified
                efforts underway that addressed aspects of these elements.

                Additionally, we analyzed the services’

            •   civilian depot workforce skills and competency assessments to determine
                whether they had identified the skills and competencies needed to address
                current and future workforce requirements,
            •   civilian depot workforce retention plans to determine whether they had
                the factors identified by current research as being critical to enhancing the
                retention necessary for the construction of a high-performance
                organization, and
            •   assessments of workforce plans to determine whether they included
                performance measures that evaluated the effectiveness of their workforce
                plans.




                Page 49                                GAO-03-472 DOD Depot Workforce Planning
    Appendix I: Scope and Methodology




    Moreover, because OPM had identified the elements that should be
    included in a comprehensive retention plan, we compared those elements
    to those found in the services’ retention plans. We did not do this type of
    comparison for the services’ recruiting/hiring, training, and succession
    plans because OPM did not identify comprehensive plans for these
    elements of workforce plans.

    To determine what challenges adversely affect DOD’s strategic planning
    for the viability of its civilian depot workforce, we interviewed officials
    and obtained, reviewed, and analyzed documentation to identify the types
    of challenges that might impact planning for the viability of the civilian
    depot workforce. In doing so, we also determined

•   civilian depot workforce retirement eligibility and whether the services
    will have difficulties replacing an aging workforce if large numbers of
    eligible retirees retire over the next 5 to 7 years,
•   the total weighted average age based on the civilian staffing at each
    industrial facility,
•   whether the services are having difficulties implementing the multiskilling
    concept to improve worker efficiency and productivity, and
•   whether increased funding will be needed to address increased training
    requirements.

    During this review, we visited and obtained information from the Office of
    the Secretary of Defense and the Army, Air Force, Navy, and Marine Corps
    headquarters, all in the Washington, D.C., area; Headquarters, Army
    Materiel Command in Alexandria, Virginia; and 5 subordinate Army
    commands—the Army Aviation and Missile Command, Huntsville,
    Alabama; Communications-Electronics Command, Fort Monmouth, New
    Jersey; the Tank-automotive and Armaments Command, Warren,
    Michigan; Operations Support Command (now the Joint Munitions
    Command), Rock Island, Illinois; and the Soldier and Biological Chemical
    Command, Aberdeen Proving Ground, Maryland. Additionally, we visited
    the following depots and activities:

•   Army: Anniston Army Depot, Anniston, Alabama; Corpus Christi Army
    Depot, Corpus Christi, Texas; Letterkenny Army Depot, Chambersburg,
    Pennsylvania; Red River Army Depot, Texarkana, Texas; Tobyhanna Army
    Depot, Tobyhanna, Pennsylvania; Rock Island Arsenal, Rock Island,
    Illinois; Watervliet Arsenal, Watervliet, New York; Pine Bluff Arsenal,
    Pine Bluff, Arkansas; Crane Army Ammunition Activity, Crane, Indiana;
    and McAlester Army Ammunition Plant, McAlester, Oklahoma.




    Page 50                               GAO-03-472 DOD Depot Workforce Planning
    Appendix I: Scope and Methodology




•   Air Force: Air Force Materiel Command, Wright-Patterson Air Force
    Base, Ohio; Aerospace Maintenance and Regeneration Center, Tucson,
    Arizona; Directorate of Maintenance, Ogden, Utah; Directorate of
    Maintenance, Oklahoma City, Oklahoma; Directorate of Maintenance,
    Warner Robins, Georgia; and the Joint Depot Maintenance and Activities
    Group, Wright-Patterson Air Force Base, Ohio.
•   Navy: Naval Air Systems Command, Patuxent River, Maryland; Naval
    Aviation Depot, Cherry Point, North Carolina; Naval Aviation Depot,
    Jacksonville, Florida; and Naval Aviation Depot North Island, San Diego,
    California;
•   Navy: Naval Sea Systems Command, Washington, D.C.; Norfolk Naval
    Shipyard, Portsmouth, Virginia; Portsmouth Naval Shipyard, Portsmouth,
    New Hampshire; and Puget Sound Naval Shipyard, Bremerton,
    Washington.
•   Navy: Space and Naval Warfare Systems Center, Charleston, South
    Carolina.
•   Marine Corps: Marine Corps Materiel Command, Albany, Georgia; Marine
    Corps Logistics Bases Albany, Georgia; Marine Corps Logistics Bases
    Barstow, California; Marine Corps Maintenance Center, Albany, Georgia;
    and the Marine Corps Maintenance Center, Barstow, California.

    Additionally, we received written responses to audit questions from the
    following activities: Pearl Harbor Naval Shipyard and Intermediate
    Maintenance Facility, Pearl Harbor, Hawaii; Space and Naval Warfare
    Systems Center San Diego, California; Naval Surface Warfare Center Crane
    Division, Crane, Indiana; and Naval Undersea Warfare Center Keyport
    Division, Keyport, Washington.

    We conducted our review from October 2001 to March 2003 in accordance
    with generally accepted government auditing standards.




    Page 51                             GAO-03-472 DOD Depot Workforce Planning
                                    Appendix II: Fiscal Year 2002 Services’
Appendix II: Fiscal Year 2002 Services’
                                    Depots



Depots


                                                                                                                   Number of
                                                                                                                civilian depot
                                                                                                               employees per
Depots                    Principal work                                                                               location
Army
Army depots
Anniston Army Depot       The depot performs maintenance on heavy and light-tracked combat vehicles                      2,429
Anniston, Alabama         and components and is the designated center of technical excellence for the
                          M1 Abrams tank.
Corpus Christi            As the Army’s only aviation facility, the depot overhauls and repairs DOD                      2,869
Army Depot                rotary wing aircraft and components, such as the AH-64 Apache, CH-47
Corpus Christi, Texas     Chinook, and the UH-60 Blackhawk.
Letterkenny               This depot provides repair and overhaul support for air defense and tactical                   1,082
Army Depot                missiles such as the Patriot, Hawk, Avenger, Multiple Launch Rocket System,
Chambersburg,             and Sidewinder.
Pennsylvania
Red River                 For combat and tactical systems, the depot supports systems such as the                        1,478
Army Depot                Bradley Fighting Vehicle, Multiple Launch Rocket System, and vehicles for the
Texarkana, Texas          Patriot and Hawk missiles.
Tobyhanna                 From handheld radios to satellite communication, the depot provides repair                     2,237
Army Depot                and overhaul support for hundreds of communications and electronic systems.
Tobyhanna, Pennsylvania
Army arsenals
Rock Island Arsenal       The arsenal is primarily a metal manufacturing facility with foundry, forging,                 1,156
Rock Island, Illinois     machining, finishing, and fabricating capabilities. It produces tank and artillery
                          components such as gun mounts and recoil mechanisms, spare parts, and
                          other equipment. It also fabricates and/or assembles tool sets ranging from
                          carrying case-sized sets to fully equipped shelters.
Watervliet Arsenal        This arsenal is a metal manufacturing facility whose capabilities include                        484
Watervliet, New York      forging, casting, machining, heat-treating, plating, and fabrication. Its primary
                          products are cannons—such as the large gun tubes for tanks and howitzers—
                          and mortars.
Pine Bluff Arsenal        The facility produces, renovates, and stores smoke, riot control, and                            804
Pine Bluff, Arkansas      incendiary ammunitions such as red and white phosphorus. Also, it
                          manufactures and refurbishes chemical and biological defense equipment.
Army ammunition plants
Crane Army Ammunition     The plant produces, renovates, stores, and demilitarizes conventional                            620
Activity                  ammunition. Its products include the Navy’s 5-inch projectile, bombs, missile
Crane, Indiana            warheads, pyrotechnic munitions, and plastic explosives.
McAlester                 The plant produces, renovates, stores, and demilitarizes conventional and                      1,075
Army Ammunition Plant     missile ammunition. Its products include bombs—ranging from 500 to 5,000
McAlester, Oklahoma       pounds, missile warheads, rockets, and plastic explosives.
Total Army                                                                                                              14,234




                                    Page 52                                          GAO-03-472 DOD Depot Workforce Planning
                                        Appendix II: Fiscal Year 2002 Services’
                                        Depots




                                                                                                                   Number of
                                                                                                                civilian depot
                                                                                                               employees per
Depots                        Principal work                                                                           location
Navy
Naval Aviation Depots
Naval Aviation Depot,         The depot performs standard depot-level maintenance and periodic                           3,839
Cherry Point                  maintenance, modifications, and in-service repairs for crash and battle
North Carolina                damages for helicopters and engines. The depot performs maintenance on
                              aircraft such as the AV-8, H-53, and H-46. It also repairs such components as
                              jet fuel starters and auxiliary power units.
Naval Aviation Depot          The depot serves as a production center concentrating on repair and                        3,928
Jacksonville, Florida         modification of patrol aircraft, fighter aircraft, attack aircraft, electronic
                              countermeasures, engines, and associated components. The depot performs
                              maintenance on aircraft such as the P-3, F-14 and SH-60. Also, the depot
                              repairs components such as electro-optics, electronic warfare, and
                              antisubmarine warfare systems.
Naval Aviation Depot          The depot serves as the production center concentrating on repair and                      3,138
North Island                  modification of miscellaneous aircraft and associated components. The depot
San Diego, California         performs maintenance on the following aircraft systems: E-2 Hawkeye, C-2
                              Greyhound, and F/A 18 Hornet. It also provides engineering, logistics, and
                              calibration services.
Naval shipyards
Norfolk Naval Shipyard        This shipyard is the East Coast’s largest facility for surface ship, aircraft              7,525
Portsmouth, Virginia          carrier, and submarine overhauls, maintenance and modernization. It also
                              repairs, overhauls, dry docks, converts, modernizes, and inactivates ships.
                              Also, the shipyard can perform any technical, fabrication, manufacturing, and
                              engineering work required by its customers on site or through rapid-
                              deployment of special teams to ships and facilities anywhere in the world.
Pearl Harbor Naval Shipyard   This shipyard is the largest ship repair facility between the West Coast and               3,987
and Intermediate              Far East, and it is responsible for ship maintenance, modernization, and
Maintenance Facility          nuclear ship recycling. Also, the shipyard provides such services as reactor
Pearl Harbor, Hawaii          plant servicing, nuclear propulsion plant work, and ship maintenance training.
Portsmouth Naval              The shipyard performs nuclear submarine overhauls, refuelings,                             3,500
Shipyard                      modernizations, and repairs. Also, it provides nuclear maintenance
Portsmouth, New Hampshire     engineering and planning for the Los Angeles class submarines.
Puget Sound Naval             The shipyard overhauls and repairs all types and sizes of Navy ships. Also,                8,608
Shipyard                      the shipyard provides other services such as nuclear propulsion work, reactor
Bremerton, Washington         compartment disposal, nuclear-powered ship recycling, and emergent fleet
                              support.
Naval Warfare Centers
Naval Surface                 The overall center provides acquisition, engineering, logistics, and                         311
Warfare Center                maintenance for the fleet’s weapons and electronic systems, ordnance, and
Crane Division                associated equipment components. The majority of its depot maintenance is
Crane, Indiana                in electronic warfare systems, engineering and industrial base support,
                              electronic module test and repair, microwave components, and radar systems.
Naval Undersea Warfare        The overall center provides test and evaluation, in-service engineering,                     608
Center Keyport Division       maintenance and repair, fleet support, and industrial base support for
Keyport, Washington           designated systems. The largest depot workload is the torpedo program. Also,
                              the depot operates and maintains shops that accomplish mechanical,
                              electrical and electronic production, and assembly of complex undersea
                              warfare equipment.




                                        Page 53                                       GAO-03-472 DOD Depot Workforce Planning
                                                        Appendix II: Fiscal Year 2002 Services’
                                                        Depots




                                                                                                                                       Number of
                                                                                                                                    civilian depot
                                                                                                                                   employees per
 Depots                                      Principal work                                                                                location
 Space and Naval Warfare
 Systems Centers
 Space and Naval Warfare                     Depot operations, managed at the division level, provide engineering analysis                      49
 Systems Center Charleston                   and design, hardware/software development, and integration. Also the depot
 Charleston, South Carolina                  operations include repair, fabrication, installation, and logistics products and
                                             services to DOD and federal government sponsors.
 Space and Naval Warfare                     The depot operation at the center provides engineering, management, life                           70
 Systems Center San Diego                    cycle support, test, restoration, assessments, and prototype modeling. The
 San Diego, California                       depot operations also include facilities that enable it to serve as a designated
                                             overall point and repair facility for reparables (i.e., assemblies, modules, and
                                             printed circuit boards drawn from various types of equipment).
 Total Navy                                                                                                                                 35,563

 Marine Corps
 Maintenance Center                          The depot has multicommodity capability to support overhauls, repairs, and                        659
 Albany, Georgia                             upgrades for weapons systems such as the Amphibious Assault Vehicle,
                                             M1A1 Tank, M198 Howitzer, AN TPS 63 Radar, small arms, and
                                             communications-electronics equipment.
 Maintenance Center                          The depot has multicommodity capability to support overhauls, repairs, and                        664
 Barstow, California                         upgrades for weapons systems such as the Amphibious Assault Vehicle,
                                             M1A1 Tank, M198 Howitzer, AN TPS 63 Radar, small arms, and
                                             communications-electronics equipment.
 Total Marine Corps                                                                                                                          1,323

 Air Force
 Aerospace Maintenance                       The center provides for the storage, regeneration, reclamation, and disposal                      439
 and Regeneration Center                     of aircraft and related aerospace items such as tooling, pylons, and engines.
 Tucson, Arizona
 Directorate of Maintenance,                 It provides worldwide engineering and logistics management for the F-16 and                     5,852
 Ogden Air Logistics Center,                 maintains the C-130 aircraft. The center produces more than 250 aircraft and
 Utah                                        16,800 avionics and structural components annually. In addition, the center is
                                             responsible for logistical support of the nation’s fleet of strategic
                                             intercontinental ballistic missiles, including the Minuteman and Peacekeeper
                                             missiles. It also overhauls and repairs landing gear, wheels and brakes, rocket
                                             motors, photonic equipment, avionics, hydraulics, and software.
 Directorate of Maintenance,                 The center is the worldwide manager for a wide range of aircraft, engines,                      8,533
 Oklahoma City Air Logistics                 missile, and commodity items, aided by some of the most sophisticated
 Center, Oklahoma                            technical repair and manufacturing processes in the world. The center
                                             manages an inventory of 2,267 aircraft, which include the B-1, B-2, B-52,
                                             KC-10, C/KC-135, E-3, and about 25 other contractor logistics support aircraft.
 Directorate of Maintenance,                 This activity is the cargo/transport technology repair center for the Air Force. It             6,328
 Warner Robins,                              has worldwide management and engineering responsibilities for the repair,
 Air Logistics Center,                       modification, and overhaul of the C-130, C-141, C-5, as well as F-15, U-2,
 Georgia                                     all Air Force helicopters, and all special operations aircraft and their avionics
                                             systems.
 Total Air Force                                                                                                                            21,152
 Total                                                                                                                                      72,272
Source: DOD (data) and GAO (presentation).




                                                        Page 54                                         GAO-03-472 DOD Depot Workforce Planning
               Appendix III: Synopsis of Service Depots’
Appendix III: Synopsis of Service Depots’
               Short-Term Workforce Plans



Short-Term Workforce Plans




               Page 55                                     GAO-03-472 DOD Depot Workforce Planning
Appendix III: Synopsis of Service Depots’
Short-Term Workforce Plans




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Appendix III: Synopsis of Service Depots’
Short-Term Workforce Plans




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Appendix III: Synopsis of Service Depots’
Short-Term Workforce Plans




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Short-Term Workforce Plans




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Appendix III: Synopsis of Service Depots’
Short-Term Workforce Plans




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Appendix III: Synopsis of Service Depots’
Short-Term Workforce Plans




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Appendix III: Synopsis of Service Depots’
Short-Term Workforce Plans




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Appendix III: Synopsis of Service Depots’
Short-Term Workforce Plans




Page 63                                     GAO-03-472 DOD Depot Workforce Planning
                  Appendix IV: GAO Staff Acknowledgments
Appendix IV: GAO Staff Acknowledgments


                  Carleen Bennett, Johnetta Gatlin-Brown, Thomas W. Gilliam,
Acknowledgments   M. Jane Hunt, Steve Hunter, Jeanett Reid, Jose Watkins, and
                  Bobby Worrell made significant contributions to this report.




                  Page 64                                  GAO-03-472 DOD Depot Workforce Planning
             Related GAO Products
Related GAO Products


             Depot Maintenance: Public-Private Partnerships Have Increased
             but Long-Term Growth and Results Are Uncertain. GAO-03-423.
             Washington, D.C.: April 10, 2003.

             Human Capital: Building on the Current Momentum to Address
             High-Risk Issues. GAO-03-637T. Washington, D.C.: April 8, 2003.

             DOD Personnel: DOD Actions Needed to Strengthen Civilian Human
             Capital Strategic Planning and Integration with Military Personnel and
             Sourcing Decisions. GAO-03-475. Washington, D.C.: March 28, 2003.

             High-Risk Series: Strategic Human Capital Management. GAO-03-120.
             Washington, D.C.: January 2003.

             High-Risk Series: An Update. GAO-03-119. Washington, D.C.:
             January 2003.

             Major Management Challenges and Program Risks: Department of
             Defense. GAO-03-98. Washington, D.C.: January 2003.

             Human Capital: Effective Use of Flexibilities Can Assist Agencies
             in Managing Their Workforces. GAO-03-2. Washington, D.C.:
             December 6, 2002.

             Military Personnel: Oversight Process Needed to Help Maintain
             Momentum of DOD’s Strategic Human Capital Planning. GAO-03-237.
             Washington, D.C.: December 5, 2002.

             Depot Maintenance: Change in Reporting Practices and Requirements
             Could Enhance Congressional Oversight. GAO-03-16. Washington, D.C.:
             October 18, 2002.

             HUD Human Capital Management: Comprehensive Strategic Workforce
             Planning Needed. GAO-02-839. Washington, D.C.: July 24, 2002.

             Managing for Results: Using Strategic Human Capital Management
             to Drive Transformational Change. GAO-02-940T. Washington, D.C.:
             July 15, 2002.

             Exposure Draft: A Model of Strategic Human Capital Management.
             GAO-02-373SP. Washington, D.C.: March 15, 2002.




             Page 65                             GAO-03-472 DOD Depot Workforce Planning
           Related GAO Products




           Foreign Languages: Human Capital Approach Needed to Correct
           Staffing and Proficiency Shortfalls. GAO-02-375. Washington, D.C.:
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           Defense Logistics: Actions Needed to Overcome Capability Gaps in the
           Public Depot System. GAO-02-105. Washington, D.C.: October 12, 2001.

           Human Capital: Implementing an Effective Workforce Strategy Would
           Help EPA to Achieve Its Strategic Goals. GAO-01-812. Washington, D.C.:
           July 31, 2001.

           Defense Logistics: Strategic Planning Weaknesses Leave Economy,
           Efficiency, and Effectiveness of Future Support Systems at Risk.
           GAO-02-106. Washington, D.C.: October 11, 2000.

           Human Capital: A Self-Assessment Checklist for Agency Leaders.
           GAO/OCG-00-14G. Washington, D.C.: September 2000 Version 1.
                                                                 st
           Human Capital: Managing Human Capital in the 21 Century.
           GAO/T-GGD-00-77. Washington, D.C.: March 9, 2000.

           Human Capital: Strategic Approach Should Guide DOD Civilian
           Workforce Management. GAO/T-GGD/NSIAD-00-120. Washington, D.C.:
           March 9, 2000.

           Army Industrial Facilities: Workforce Requirements and Related Issues
           Affecting Depots and Arsenals. GAO/NSIAD-99-31. Washington, D.C.:
           November 30, 1998.

           Defense Depot Maintenance: DOD Shifting More Workload for
           New Weapon Systems to the Private Sector. GAO/NSIAD-98-8.
           Washington, D.C.: March 31, 1998.




(350246)
           Page 66                              GAO-03-472 DOD Depot Workforce Planning
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