DOD Personnel: DOD Comments on GAO's Report on DOD's Civilian Human Capital Strategic Planning

Published by the Government Accountability Office on 2003-04-18.

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

United States General Accounting Office
Washington, DC 20548

          April 18, 2003

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

          Subject: DOD Personnel: DOD Comments on GAO’s Report on DOD’s Civilian
          Human Capital Strategic Planning

          Dear Mr. Ortiz:

          In response to your request, we issued a report in March 2003 to you on the
          Department of Defense’s (DOD) strategic planning efforts for civilian personnel at
          DOD and selected defense components, including the four military services and two
          defense agencies.1 In that report we made recommendations to the Secretary of
          Defense to strengthen civilian human capital planning, including integration with
          military personnel and sourcing initiatives.2 DOD’s response to our March 2003
          report and recommendations were received too late to be included in that report. To
          provide our perspective on DOD’s comments, we briefly summarize our March 2003
          report’s objectives, results, and recommendations and DOD’s comments, along with
          our evaluation of the comments. DOD’s comments provided by the Under Secretary
          for Personnel and Readiness are included as an enclosure to this report.

          Summary of Objectives,
          Results, and Recommendations

          DOD’s civilian employees play key roles in such areas as defense policy, intelligence,
          finance, acquisitions, and weapon systems maintenance. Although downsized 38
          percent between fiscal years 1989 and 2002, this workforce has taken on greater roles
          as a result of DOD’s restructuring and transformation. Responding to congressional
          concerns about the quality and quantity of, and the strategic planning for, the civilian

          U.S. General Accounting Office, 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.: Mar. 28, 2003).
           Sourcing initiatives, which are undertaken to achieve greater operating efficiencies, include such
          efforts as public-private competitions under the Office of Management and Budget (OMB) Circular A-
          76 for commercial activities and functions; direct conversions (converting positions from one sector to
          another without public-private competition); public-private partnerships; and privatization, divestiture,
          and reengineering.

                                                                             GAO-03-690R DOD Personnel
workforce, we determined the following for DOD, the military services, and selected
defense agencies (the Defense Contract Management Agency and the Defense
Finance and Accounting Service):3 (1) the extent of top-level leadership involvement
in civilian strategic planning; (2) whether elements in civilian strategic plans are
aligned to the overall mission, focused on results, and based on current and future
civilian workforce data; and (3) whether civilian and military personnel strategic
plans or sourcing initiatives were integrated.

We found that generally civilian personnel issues appear to be an emerging priority
among top leaders in DOD and the defense components. Although DOD began
downsizing its civilian workforce more than a decade ago, it did not take action to
strategically address challenges affecting the civilian workforce until it issued its
civilian human capital strategic plan in April 2002. Top-level leaders in the Air Force,
the Marine Corps, the Defense Contract Management Agency, and the Defense
Finance and Accounting Service have initiated planning efforts and are working in
partnership with their civilian human capital professionals to develop and implement
civilian strategic plans; such leadership, however, was increasing in the Army and not
as evident in the Navy. High-level leadership is critical to directing reforms and
obtaining resources for successful implementation. Moreover, DOD has not provided
guidance on how to align the components’ plans with the department-level plan.
Without this alignment, DOD’s and its components’ planning may lack the focus and
coordination needed (1) to carry out the Secretary of Defense’s transformation
initiatives in an effective manner and (2) to mitigate risks of not having human capital
ready to respond to national security events at home and abroad.

We also found that the human capital strategic plans we reviewed for the most part
lacked key elements found in fully developed plans. Most of the civilian human
capital goals, objectives, and initiatives were not explicitly aligned with the
overarching missions of the organizations. Consequently, DOD and the components
cannot be sure that strategic goals are properly focused on mission achievement.
Also, none of the plans contained results-oriented performance measures to assess
the impact of their civilian human capital initiatives (i.e., programs, policies, and
processes). Thus, DOD and the components cannot gauge the extent to which their
human capital initiatives contribute to achieving their organizations’ mission. Finally,
the plans did not contain data on the skills and competencies needed to successfully
accomplish future missions; therefore, DOD and the components risk not being able
to put the right people, in the right place, and at the right time, which can result in
diminished accomplishment of the overall defense mission.

Moreover, the civilian strategic plans did not address how the civilian workforce will
be integrated with their military counterparts or sourcing initiatives. DOD’s three
human capital strategic plans—two military and one civilian—were prepared
separately and were not integrated to form a seamless and comprehensive strategy
and did not address how DOD plans to link its human capital initiatives with its
sourcing plans, such as efforts to outsource non-core responsibilities. The

 Throughout this report, the term “component” refers to all services and agencies in DOD. The term
“service” refers to the Air Force, the Army, the Marine Corps, and the Navy. The term “agency” refers
to the Defense Contract Management Agency and the Defense Finance and Accounting Service.

    2                                                             GAO-03-690R DOD Personnel
components’ civilian plans acknowledge a need to integrate planning for civilian and
military personnel—taking into consideration contractors—but have not yet done so.
Without an integrated strategy, DOD may not effectively and efficiently allocate its
scarce resources for optimal readiness.

To improve human capital strategic planning for the DOD civilian workforce, we
recommended in our March 2003 report that the Secretary of Defense direct the
Under Secretary of Defense for Personnel and Readiness to undertake the following:

•   Improve future revisions and updates to the DOD departmentwide strategic
    human capital plan by more explicitly aligning with DOD’s overarching mission,
    including results-oriented performance measures, and focusing on future
    workforce needs. To accomplish this, the revisions and updates should be
    developed in collaboration with top DOD and component officials and civilian and
    military human capital leaders.

•   Direct the military services and the defense agencies to align their strategic human
    capital plans with the mission, goals, objectives, and measures included in the
    departmentwide strategic human capital plan and provide guidance to these
    components on this alignment.

•   Define the future civilian workforce, identifying the characteristics (i.e., the skills
    and competencies, number, deployment, etc.) of personnel needed in the context
    of the total force and determine the workforce gaps that need to be addressed
    through human capital initiatives.

•   Assign a high priority to and set a target date for developing a departmentwide
    human capital strategic plan that integrates both military and civilian workforces
    and takes into account contractor roles and sourcing initiatives.

Agency Comments And Our Evaluation

DOD’s comments on a draft of the March 2003 report are summarized below and
reproduced in enclosure I. DOD stated that it appreciated the perspectives provided
in that report and intended to address the recommendations. Regarding our four
recommendations, however, DOD concurred with one, partially concurred with
another, and nonconcurred with two. In its comments, DOD pointed out that its
strategic planning activities are in the earliest stages of development. We
acknowledge this and, moreover, note in our March 2003 report that strategic
planning is a continuous process. Our recommendations to the Secretary of Defense,
thus, focus on steps the Under Secretary of Defense for Personnel and Readiness
should take to strengthen DOD’s overall strategic perspective as DOD continues to
develop planning initiatives for its civilian human capital.

Our evaluation of DOD’s comments on these recommendations follows:

DOD concurred with our recommendation to direct the military services and the
defense agencies to align their strategic human capital plans with the
departmentwide plan. DOD stated that it is the component’s responsibility to ensure
that its strategic plan and outcomes dovetail with the departmentwide plan.

3                                                          GAO-03-690R DOD Personnel
DOD partially concurred with our recommendation to improve future revisions and
updates to the departmentwide strategic human capital plan by more explicitly
aligning its elements (including performance measures) with DOD’s overarching
mission and by focusing the plan more directly on future workforce needs. DOD
stated the recommendation did not recognize the involvement in and the impact of
DOD’s Quadrennial Defense Review (QDR) on the development of the
departmentwide plan. As we note in our March 2003 report, the departmentwide
civilian plan was directed in the QDR and Defense Planning Guidance and by the
Under Secretary of Defense for Personnel and Readiness; we also note that such a
plan had been recommended, as well, in the Defense Science Board 2000 report. Our
analysis found, however, that the plan did not fully demonstrate alignment with
DOD’s overall mission in that the plan lacked explicit information about how the
civilian workforce contributes to accomplishing DOD’s overall mission and how the
achievement of human capital initiatives will improve DOD’s performance in meeting
that mission. DOD also noted that the plan contains detailed performance indicators
and measures that are reported quarterly to OMB. In reviewing these indicators, we
found, for the most part, they are necessary measures relevant to task
accomplishment but not oriented to assessing results. In addition, DOD noted that
the plan recognizes the need for results-oriented performance measures; we believe
that our recommendation highlights the importance of developing such measures.

DOD did not concur with our recommendation to define its future civilian personnel
needs in a total force context, including identifying the workforce gaps that need to
be addressed through human capital initiatives. DOD stated this action was already
being accomplished through information provided to OMB and the Office of
Personnel Management for the President’s Management Agenda Scorecard. We
recognize that OMB requires workforce information, however, we cannot comment
on the completeness of the data being supplied because we were not permitted to
review recent DOD submissions to OMB. Complying with OMB requirements is
important but does not fully address the intent of our recommendation that is to
ensure that workforce data, which identify necessary future skill sets and potential
gaps that might occur in force-shaping, be compiled and analyzed as an integral part
of the strategic planning process and factored into planning for human capital
initiatives. As we note in our March 2003 report, this information is highly important
in targeting the initiatives to address the gaps and to provide the rationale—that is,
the business case—for obtaining the resources or authorities to carry out initiatives.

Also, DOD did not concur with our recommendation to assign a high priority to and
set a target date for developing an integrated departmentwide plan for both military
and civilian workforces that takes into account contractor roles and sourcing
initiatives. DOD stated it presently has both a military and civilian plan; the use of
contractors is just another tool to accomplish the mission, not a separate workforce,
with separate needs, to manage. The intent of our recommendation (and the one
above on workforce planning) is that strategic planning for the civilian workforce be
undertaken in the context of the total force—civilian, military, and contractors—
because the three workforces are expected to perform their responsibilities in a
seamless manner to accomplish DOD’s mission. Integrated planning could also
facilitate achieving a goal in the QDR to focus DOD’s resources (personnel) in those
areas that directly contribute to warfighting and to rely on the private sector for non-

4                                                        GAO-03-690R DOD Personnel
core functions. The need for total force integration has been advocated in the QDR,
DOD’s response to OMB regarding a restructuring plan, the Defense Science Board
2000 report, National Academy of Public Administration (NAPA) studies, and the
Commercial Activities Panel report. We believe strategic planning in a total force
context is especially important because the trend toward greater reliance on
contractors requires a critical mass of civilian and military personnel with the
expertise necessary to protect the government’s interest and ensure effective
oversight of contractors’ work. Workforce planning should be implemented using a
coordinated and integrated approach to determine the proper roles and mix of
military, civilian, and contractor employees within the context of mission objectives
that are essential to national security.

We continue to believe that our recommendations have merit and will strengthen the
department’s strategic planning efforts for the civilian as well as the overall
workforce; consequently, we are not revising them. DOD also provided technical
comments, which we incorporated, as appropriate, into our March 2003 report.

Finally, we want to emphasize that we recognize a point made by the Under Secretary
of Defense for Personnel and Readiness that DOD is in the early stages of its strategic
planning efforts. We believe that DOD has made progress in establishing a
foundation for strategically addressing civilian human capital issues by developing its
departmentwide civilian human capital strategic plan. Opportunities exist, however,
to strengthen the planning efforts. Our March 2003 report and its recommendations
should be viewed in that light.

We are sending copies of this report to the appropriate congressional committees; the
Secretary of Defense; the Secretaries of the Air Force, Army, and Navy; the
Commandant of the Marine Corps; and the Directors of the Defense Contract
Management Agency and the Defense Finance and Accounting Service. We will also
make copies available to others upon request. In addition, this report will be available
at no charge on the GAO Web site at http://www.gao.gov.

If you or your staff have any questions concerning this report, please contact me at
(202) 512-5559 or Christine Fossett at (202) 512-2956.

Sincerely yours,

Derek B. Stewart
Director, Defense Capabilities
and Management


5                                                       GAO-03-690R DOD Personnel
Enclosure I

              Comments from the Department of Defense

6                                          GAO-03-690R DOD Personnel
7   GAO-03-690R DOD Personnel

8          GAO-03-690R DOD Personnel
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