Military Personnel: General and Flag Officer Requirements Are Unclear Based on DOD's 2003 Report to Congress
Published: 2004-04-21T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: The Fiscal Year 2003 National Defense Authorization Act directed the Department of Defense (DOD) to assess whether general and flag officer authorizations were sufficient to meet all requirements. GAO's objectives were to determine whether DOD (1) fully disclosed the results of its study in its March 2003 report to Congress and explained the rationale for any recommendations, (2) used an established methodology to meet the objectives of its study, and (3) incorporated lessons learned from a GAO review of DOD's 1997 general and flag officer study. The 2003 act also directed DOD to review legislation affecting general and flag officer management. DOD included the results of its review in the March 2003 report, making several recommendations. GAO plans a separate review of these issues and recommendations.
section_title: What GAO Found
paragraphs: DOD's March 2003 report to Congress did not fully disclose the results of the general and flag officer study or explain its recommendation not to seek additional authorizations (people) to meet validated requirements (positions). The general and flag officer study validated requirements for general and flag officer positions that exceeded congressional authorizations for both the active and reserve components. However, the validated requirements data generated by the study were not disclosed in the March 2003 report to Congress. In its report, DOD did not address the magnitude of the gap between validated requirements of 1,630 positions and congressional authorizations of 1,311--a difference of 319. DOD's report also did not address the impact of "workarounds" used to fill the gap between requirements and authorizations, such as the practice of assigning colonels and Navy captains to general and flag officer positions. Fully disclosing the study results and discussing the implications of these findings in the March 2003 report to Congress would have provided a more complete picture of DOD's general and flag officer requirements and may have helped to explain its recommendation not to seek additional authorizations. DOD used an established methodology to conduct a position-by-position validation of general and flag officer requirements. This methodology, known as job evaluation, has been widely used in the United States. Job evaluation, however, has numerous subjective features, including the selection of factors used for measurement. In addition, it is not designed to project emerging needs, such as those that could result from transformation efforts. Periodic updates could capture changes in requirements. Such limitations do not invalidate DOD's methodology; however, an explicit acknowledgment and assessment of these limitations would have provided more context for the study results. In addition, the study did not clearly account for dual-hatted positions (where one individual holds more than one position simultaneously) or assess how each service's authorizations were affected by the need to contribute general and flag officers to fill external (joint) positions. Addressing these issues could have enhanced the precision and usefulness of DOD's study. In addition, we noted that while Congress directed DOD to ensure the Reserve Forces Policy Board participated in development of the report's recommendations, the Board played a minimal role in producing DOD's 2003 report. The Board registered strong objections to DOD's recommendation not to seek additional authorizations now to meet validated requirements and to the limited role it played in the process. DOD, in conducting its 2003 general and flag officer study, incorporated some of the lessons learned from a GAO review of DOD's 1997 general and flag officer study. DOD recognized the need to identify general and flag officer positions that could conceivably be converted from the military ranks to the civilian workforce, although it deferred this assessment until after the general and flag officer study was complete. DOD is currently assessing civilian conversion of general and flag officer positions.

section_title: Letter
paragraphs: Congress places specific legislative limits on the military services’ general  and flag officers, including ceilings on the maximum number of general  and flag officers each service is authorized. In the Fiscal Year 2003  National Defense Authorization Act, Congress directed the Secretary of  Defense to study general and flag officer authorizations and to provide an  assessment of whether authorizations were sufficient to meet all general  and flag officer requirements. The mandate directed the Secretary of  Defense to submit the results of this study in a report to Congress. The  Department of Defense (DOD) conducted a study to validate general and  flag officer requirements and subsequently submitted a report to Congress  in March 2003. The 2003 act required GAO to evaluate DOD’s study. As  agreed with your offices, our objectives were to determine whether DOD  (1) fully disclosed the results of the general and flag officer study in its  March 2003 report to Congress and explained the rationale for any  recommendations, (2) used an established methodology to meet the  objectives of its study, and (3) incorporated lessons learned from a GAO  review of DOD’s 1997 general and flag officer study. The 2003 act also  directed DOD to review legislation affecting the management of general  and flag officers. DOD included the results of its review in the March 2003  report and made several recommendations. We plan to conduct a separate  review of these management issues and recommendations; we do not  address them in this report.
To conduct our review, we reviewed the results of DOD’s general and flag  officer requirements study, supporting documentation, and the March 2003  report to Congress. We also discussed the study methodology with DOD  officials in the Office of the Under Secretary of Defense for Personnel and  Readiness, the military services, the Joint Staff, and others. We conducted  our review from October 2003 to March 2004 in accordance with generally  accepted government auditing standards. More information on our scope  and methodology is provided at the end of this letter.
DOD officials worked with a contractor to support the study effort and  participated in developing and refining the study methodology, gathering  and validating the data, and reviewing and approving the study results. The  study results were also vetted through the service and Joint Staff senior  leadership before being finalized. For DOD’s general and flag officer study,  “authorizations” were defined as the number of general and flag officers  allowed under the law (people) and “requirements” as billets the DOD  components claim should be filled by a general or flag officer (positions).
subsections: section_title: Background
subsections: section_title: General and Flag Officer Ranks
paragraphs: Congress has established four military ranks above the rank of colonel (for  the Army, Air Force, and Marine Corps) and captain (for the Navy).  Table 1 displays the pay grade designation, title of rank, and insignia worn  by officers at general and flag officer ranks.
section_title: Roles and Responsibilities
paragraphs: Within the Office of the Under Secretary of Defense for Personnel and  Readiness, the Officer and Enlisted Personnel Management office is  responsible for general and flag officer matters, including the application  of related legislation. Each of the services and the Joint Staff has a general  officer matters office that is responsible for management of general and  flag officers within their organization. Management of reserve component  general and flag officers falls under the service general officer matters  offices, the service reserve chiefs, and the National Guard Bureau. Their  responsibilities include managing the selection, promotion, assignment,  and retirement of general /flag officers in addition to coordination with  other DOD and non-DOD organizations.
The Reserve Forces Policy Board, acting through the Assistant Secretary  of Defense for Reserve Affairs, is the principal policy adviser to the  Secretary of Defense on matters relating to the reserve components.  The Board was created by an act of Congress in 1952. Among its duties,  the Board evaluates proposals by its members or other agencies for  changes to existing laws and policies and recommends appropriate  actions. The Board is composed of 24 members, including a civilian  chairman and the assistant secretaries of the Army, Navy, and Air Force  responsible for reserve components.
section_title: Congressional Mandates in 1997 and 2003 to Review Authorizations
paragraphs: The Fiscal Year 1997 National Defense Authorization Act directed the  Secretary of Defense to review existing statutory general and flag officer  authorizations and submit a report to Congress. The act also directed GAO  to evaluate DOD’s study. The military services and Joint Staff conducted  their own studies. On the basis of these study results, DOD developed a  draft report; however, it never issued a final report. We testified on DOD’s  study in April 1997 and issued a report in June 1997 that discussed the  draft DOD report. Congress included similar mandate language in the  Fiscal Year 2003 National Defense Authorization Act. As in 1997, the  Secretary of Defense was directed to review existing statutory general and  flag officer authorizations and submit a report to Congress. The report  was to include any recommendations (together with the rationale)  concerning revision of the limitations on general and flag officer grade  authorizations. The act also stated that certain provisions of the Fiscal  Year 1997 National Defense Authorization Act would apply. One of the  applicable provisions from the 1997 act directed GAO to evaluate  DOD’s study.
section_title: DOD’s Study of General and Flag Officer Requirements and the March 2003 Report to Congress
paragraphs: To respond to the 2003 mandate, the Office of the Secretary of Defense  contracted with the Logistics Management Institute (LMI) to assess and  validate general and flag officer requirements. The results of the  requirements study were expected to serve as a baseline of validated  general and flag officer positions and provide a basis for future efforts,  such as identifying innovative ways to manage senior leadership. The  Assistant Secretary of Defense (Force Management Policy) established a  working panel and a senior panel to support LMI’s review. The working  panel was chaired by the Director, Officer and Enlisted Personnel  Management, and included representatives from the military services’ and  Joint Staff’s general and flag officer management offices and from the  Office of the Secretary of Defense. The senior panel was chaired by the  Deputy Assistant Secretary of Defense for Military Personnel Policy, with  participation by the service personnel chiefs, the Joint Staff’s Director for  Manpower and Personnel, and representatives from the Office of the  Secretary of Defense. The general and flag officer study was completed in  March 2003. DOD subsequently submitted its report to Congress on  March 31, 2003.
section_title: Previous DOD Studies of General and Flag Officer Requirements
paragraphs: DOD has conducted several previous reviews of its general and flag  officer requirements. In the 1997 draft report, DOD identified a need for  1,472 general and flag officers, including 1,018 active component and  454 reserve component officers. According to DOD, the 1997 study was the  first to integrate active and reserve component requirements. A 1988 DOD  study found a requirement for 1,436 general and flag officer positions.  A 1978 DOD study identified a requirement for 1,419 general and flag  officers. In 1972, DOD identified a requirement for 1,304 general and flag  officers. Congressional authorizations for general and flag officers  typically have been lower than requirements identified in DOD’s studies.
section_title: Results of General and Flag Officer Study Were Not Fully Disclosed in DOD’s March 2003 Report to Congress
paragraphs: The general and flag officer study validated total requirements for  1,630 general and flag officer positions. Congress, since fiscal year 1996,  has authorized the services a total of 1,311 general and flag officers, a  difference of 319. DOD, in the March 2003 report to Congress,  recommended no additional authorizations to meet validated  requirements. DOD did not explain its rationale for keeping authorizations  at current levels, except to say that other options for managing general  and flag officers were being considered. The report also did not provide  the requirements data generated by the general and flag officer study, nor  did it address the magnitude or the impact of the gap between  requirements and authorizations.
subsections: section_title: DOD Study Validated Requirements for 1,630 General and Flag Officer Positions
paragraphs: The general and flag officer study validated requirements for a total of  1,630 general and flag officer positions, including 1,039 validated  requirements in the active component and 591 validated requirements in  the reserve component. Tables 2 and 3 display results from DOD’s study.
Title 10 of the U.S. Code establishes service-specific ceilings for active  duty general and flag officers that total 877. Title 10 also authorizes  12 general and flag officer positions to be allocated by the Chairman of  the Joint Chiefs of Staff to the services for joint duty positions. These  authorizations, called the “Chairman’s 12,” do not count against the service  ceilings. In addition, DOD is authorized a maximum of 422 reserve  component general and flag officers. Title 10 of the U.S. Code establishes  service ceilings for reserve component general and flag officers. Congress  last revised service ceilings in fiscal year 1996. Table 4 displays  congressional authorizations for general and flag officers.
section_title: DOD Did Not Explain the Rationale for Keeping Authorizations at Current Levels
paragraphs: On the basis of the general and flag officer study results, DOD found that  the number of validated requirements for general and flag officer positions  exceeded the number of general and flag officers currently authorized  under law. DOD concluded in its March 2003 report to Congress that all  current authorizations for active and reserve general and flag officers  were needed. Although DOD’s report made several recommendations  concerning management of general and flag officers, DOD recommended  no change to the authorized number of general and flag officers or their  grades at this time.
DOD, in the March 2003 report, did not explain its rationale for keeping  general and flag officer authorizations at current levels. DOD’s stated  rationale for not requesting additional authorizations was that before the  department considers proposing a legislative increase in authorizations, it  must look at other innovative ways to meet these requirements. DOD did  not specify the options it would consider except to say that it intended to  review its overall senior leadership needs, including both civilian and  military leaders, and might seek authority to manage senior leaders under  an overall ceiling. DOD stated that until this review was complete, the  services would continue to meet their internal and external general and  flag officer requirements using available management tools as  “workarounds,” such as use of individuals selected for promotion to higher  grades and frocking authority. DOD did not state when this review would  be complete.
In the March 2003 report, DOD did not address the magnitude or the  impact of the gap between validated requirements and authorizations. The  general and flag officer study summarized the validated requirements by  active and reserve component, by service, and by grade. More detailed  data was provided in a database of validated requirements that was  developed as part of the study. However, the March 2003 report did not  disclose this data or address the magnitude of the gap between validated  requirements and authorizations. The total gap between validated  requirements and authorizations was 319. In the active component, the  study validated requirements for 1,039 general and flag officer positions,  compared with 889 authorizations (a difference of 150). In the reserve  component, the study validated requirements for 591 general and flag  officer positions, compared with 422 authorizations (a difference of 169).  These gaps are illustrated in figure 1.
While the March 2003 report noted that the services would continue to use  frocking and other “workarounds” to meet requirements, it did not address  the impact of these workarounds. Following are examples of workaround  issues that DOD did not address in its report:    How do the services determine which positions to fill with an officer at a  lower grade? Are some validated requirements going unfilled altogether?    Do officers at lower pay grade levels have legal authority to carry out all  duties required of a general and flag officer position?
Does the practice of assigning lower grade officers to general and flag  officer positions affect the ability of an organization to perform its  mission?
What is the impact of these workarounds on the overall management of  general and flag officers and of officers in lower grades?
Are there benefits to using these workarounds, such as providing  developmental opportunities for officers in lower grades? Do the benefits  outweigh any negative effects of using these workarounds?
To what extent have each of the services used these workarounds?
section_title: DOD Used an Established Methodology, but Precision and Usefulness of Results Could Be Enhanced
paragraphs: DOD used an established methodology known as job evaluation to assess  general and flag officer requirements. Job evaluation methodologies have  been widely used in the United States to assess job value and rank one job  against another. One limitation of job evaluation is that it has numerous  subjective features, including the selection of job factors to be assessed.  The factors used in DOD’s study were subject to differing interpretations.  Another limitation is that the methodology is based on an existing  organizational structure at a designated point in time. The methodology is  not designed to capture new or emerging needs, such as those resulting  from DOD transformation efforts or other changes in the department.  Periodic updates could capture changes in requirements. Such limitations  do not invalidate DOD’s methodology; however, an explicit  acknowledgment and assessment of these limitations would have provided  more context for the study results. In addition, the study did not clearly  account for dual-hatted positions or assess how each service’s  authorizations were affected by the need to contribute general and flag  officers to fill external (joint) positions. Addressing these issues could  have enhanced the precision and usefulness of DOD’s study. In addition,  we noted that while Congress directed DOD to ensure the Reserve  Forces Policy Board participated in development of the report’s  recommendations, the Board played a minimal role in producing the  DOD 2003 report. The Board registered strong objections to  DOD’s recommendation not to seek additional authorizations now to  meet validated requirements and to the limited role it played in the  overall process.
subsections: section_title: DOD Used Job Evaluation Methodology to Assess General and Flag Officer Requirements
paragraphs: To assess and validate general and flag officer requirements, DOD applied  an established methodology known as job evaluation. Job evaluation  methodologies have been widely used in the United States and were used  in past general and flag officer studies, including the 1997 and  1988 studies. Job evaluation is a formal procedure for hierarchically  ordering a set of jobs in terms of their value or worth to the organization.  No universally accepted approach to job evaluation exists, and several  types of job evaluation methodologies may be used. DOD’s 2003 study was  not explicit about the type of job evaluation methodology used but  appeared to be a point-factor system. While point-factor systems may vary,  the basic steps involved are gathering job descriptions for all jobs,  selecting the factors to be used for measurement, identifying benchmarks  for comparing jobs in a similar industry or field, assigning weights to the  factors, assigning numerical values to the selected factors, and  establishing a rank band. DOD’s study included all of these steps in its job  evaluation methodology except for identifying benchmarks. Benchmarks  are typically used when the purpose of the evaluation is to determine  appropriate compensation.
The steps in the general and flag officer study were as follows:    At LMI’s request, the services and the Joint Staff submitted data on all of  their general and flag officer positions and on a sample of colonel and  Navy captain positions.
The working panel established five functional groups to categorize the  positions to be assessed. These five groups were operations, combat  development, material, headquarters staff, and special staff. The working  panel and LMI selected factors to be used in the assessment and weighted  the factors for each functional group.
LMI placed the submitted positions into the five functional groups. The  senior panel validated the functional groups, the factors, and the  weighting.
For the positions to be assessed, the services and the Joint Staff gathered,  validated, and entered information about each factor into a database  created by LMI.
Using the database information, nine LMI scorers assessed each position  by assigning numerical values to the factors and rank-ordered the  positions within their functional groups. The LMI scorers were retired  military officers representing a cross section of the military services, as  well as the active and reserve components. They were divided into three  panels of three members each.
The senior panel reviewed and validated the LMI scoring, including the  breakpoints between pay grades (for example, between O-7s and O-8s).  Results were then vetted through the service and Joint Staff senior  leadership.
section_title: Job Evaluation Methodology Has Certain Limitations
paragraphs: A basic aim of job evaluation methodologies is to interject objectivity into  what is inherently a subjective process—assigning the relative value of  work to an organization. Nevertheless, subjectivity is commonly a part of  job evaluation. For example, the factors selected for measurement and the  weighting of the factors are based on subjective judgment. Also, the  process of scoring jobs is subjective, as are management adjustments to  the study results.
A second limitation of job evaluation methodology is an assumption that  an existing organizational structure can serve as an adequate starting point  for the assessment. The methodology reviewed current positions and was  not designed to capture new or emerging needs. According to the Joint  Staff, the study methodology, as well as time constraints, did not give them  the opportunity to identify unresourced general and flag officer  requirements. DOD efforts to reorganize the Army, alter the overseas  presence of U.S. troops, and transfer thousands of military jobs to the  civilian workforce, if implemented, could change requirements for general  and flag officers. Such changes could be captured through periodic  updates to the requirements. According to an official in the Office of the  Under Secretary of Defense for Personnel and Readiness, the services and  Joint Staff have been asked to submit new general and flag officer  requirements to keep the data current. We agree that identifying new  requirements is a necessary step to keep the data up-to-date; however,  these new requirements are not going through the kind of job evaluation  assessment and validation DOD used in its study.
We found that neither the DOD study nor the March 2003 report to  Congress addressed the limitations in the methodology selected. For  instance, neither document specified the subjective features of the  methodology or the assumptions underlying the study. In addition, they  did not explicitly state the steps taken to test the reliability or validity of  the study. These issues do not invalidate the results of the general and flag  officer study, but an explicit acknowledgement and assessment of these  issues would have provided more context for the study results.
section_title: Factors Used to Measure Job Value Open to Differing Interpretations
paragraphs: A critical step in job evaluations is the selection of factors to be measured.  Because the factors are used to assess job value, the selection of these  factors can influence the study results. LMI reviewed the factors used in  the 1997 general and flag officer study and found similarities among them  that could be traced to a set of 16 factors that predated the 1997 study. The  origin of the 16 factors, however, is unclear. According to the general and  flag officer study, the 16 factors originated in the deliberations of the Bolte  commission in the late 1950s. An LMI official told us neither LMI nor the  services could locate the original source document for the 16 Bolte  factors; hence, LMI used a secondary service source to identify these  factors. Two service regulations—Marine Corps Order 5311.4,  dated September 30, 1986, and OPNAV Instruction 5420.87A,  dated February 12, 1981—listed the 16 factors. (See app. I for a list of the  16 factors.)
The working panel made minor adjustments to the wording of the factors,  and the senior panel approved their use for the study. DOD officials told  us that the factors were broad enough to cover the significant aspects of  general and flag officer positions, although one service official expressed  concern that nuances between the services were not captured. The  services and the Joint Staff were responsible for gathering the data on the  factors for the positions and for entering this data into a database. The  services and Joint Staff asked other offices (such as major commands and  reserve component offices) and individuals (including general and flag  officers) to provide the needed information.
This decentralized process left the factors open to differing  interpretations. We selected a small number of similar general and flag  officers and, comparing the information provided, noted inconsistencies in  how the services and Joint Staff applied the factors. For example, the  superintendents of the three service academies (the U.S. Military  Academy, the U.S. Naval Academy, and the U.S. Air Force Academy) have  the same function (combat development and training of future officers),  the same rank (O-9), and oversee roughly similar numbers of personnel.  However, the position descriptions for the superintendents vary greatly,  even in terms of quantitative criteria like the magnitude of personnel and  physical resources. In one case, overall dollar figures are given; in the  second case, a budget breakdown is provided; and in the last case, the  number and type (but not value) of equipment is provided. Information  ranged from vague (“the Superintendent currently has sufficient authority  to make decisions and commit resources within the scope of his position”)  to detailed (“formulates and directs the execution of policies, procedures,  and programs required to accomplish the  mission—cadet  leader development system; cadet honor system and honor code;  academic curriculum, military and physical programs; strategic vision,  planning, and communications;  manpower and resource allocation”).
section_title: Other Methodological Issues
paragraphs: During our review, we noted other issues concerning the methodology  used to conduct the requirements study.
The methodology did not allow for clear-cut differentiation between O-6  and O-7 positions and between O-7 and O-8 positions. Differentiation  among the higher grades was more clear-cut. One service official said the  factors were easier to apply to the higher grades.
Factors were weighted identically for a diverse array of general and  flag officer positions. The functional groups contained between 123 and  562 positions, with the result that the same weighting was applied to a  diverse array of positions. For example, the same weighting was applied  to the following Army positions in the special staff functional group: the  Deputy Chief of Chaplains, the Assistant Judge Advocate General for  Military Law and Operations, and the Dean of the Academic Board at the  U.S. Military Academy.
Several service officials expressed concern about the short time frame for  conducting the study. Officials from one service told us they had not had  time to verify the information submitted for all the service’s general and  flag officer positions and instead did spot checks of the information.
section_title: 2003 Study Did Not Clearly Account for Dual-Hatted Positions
paragraphs: Some general and flag officers are dual-hatted, simultaneously holding  more than one position. One goal of the general and flag officer study was  to identify dual-hatted positions and assess them as a single position.  When LMI initially requested information on each position, it asked the  military services and the Joint Staff to identify whether any other  dual-hatted titles were associated with the position. LMI created a  separate field—other titles (if dual hatted)—to capture this information in  the requirements database. Our analysis of the 1,630 positions in the  database showed that 113 positions were listed in this field as having other  titles. For assessment purposes, each dual-hatted pair was considered as a  single position and categorized as either an Army, an Air Force, a Navy,  a Marine Corps, or an external (joint) position.
Our review showed that despite these efforts, the study did not clearly  account for dual-hatted positions. First, the study did not distinguish  whether positions were dual-hatted for organizational efficiencies or  due to limited manpower. Separate studies of general officers conducted  for the Army and Marine Corps under the 1997 mandate stated that  dual-hatted positions may be created to increase efficiency of operations  or administration. On the other hand, they may also be created to  maximize leadership or management within the constraint of available  authorization ceilings. The Marine Corps study stated that “sorting out  these two different reasons is an important part of any study which  purports to determine requirements, rather than to accommodate to  scarcities.” The general and flag officer study did not address these  different reasons for dual-hatting. As a result, requirements for general and  flag officers could be different than the study data showed.
Second, we found a small number of dual-hatted positions that were  counted as separate requirements. Although an LMI official acknowledged  that one pair of dual-hatted positions was double-counted, our analysis of  the 113 positions listed as dual-hatted showed that at least 6 pairs of  positions were counted separately in the requirements database. Three  pairs of positions were internal to the Marine Corps, two pairs were  Army/external (joint) positions, and one pair was internal to the Army.
In the Marine Corps, the following dual-hatted positions were included  as separate positions: the Deputy Commanding General, 1st Marine  Expeditionary Force, and the Commanding General, 1st Marine  Expeditionary Brigade; the Deputy Commanding General,  2nd Marine Expeditionary Force, and the Commanding General,  2nd Marine Expeditionary Brigade; and the Deputy Commanding  General, 3rd Marine Expeditionary Force, and the Commanding General,  3rd Marine Expeditionary Brigade.
The Army/external (joint) dual-hatted positions that were included as  separate positions were the Deputy Commanding General, Eighth  U.S. Army, and C-3/J-3, United Nations Command/Combined Forces  Command/U.S. Forces Korea; and the Deputy Assistant Chief of Staff  C/J-4, United Nations Command/Combined Forces Command/U.S. Forces  Korea and Deputy Commanding General (Support), Eighth U.S. Army.  In the Army, the Program Executive Office for the Army’s Air and Missile  Defense and the Deputy Commanding General (Acquisition), U.S. Army  Space and Missile Defense Command, were dual-hatted but included as  separate positions.
A third problem was a lack of consistency in identifying dual-hatted  positions. Although the requirements database had the other titles  (if dual-hatted) data field, we identified at least 37 positions that listed  nothing under this field but included one or more dual-hatted titles  elsewhere in their position descriptions. Thus, while the database  identified 113 dual-hatted positions, other dual-hatted positions included  in the database were not clearly identified as such.
section_title: External (Joint) Requirements Were Not Tracked Back to Each Service’s Authorizations
paragraphs: DOD’s general and flag officer study did not assess how each service’s  authorizations were affected by the need to contribute general and flag  officers to fill external (joint) positions. As a result, direct comparisons  between the requirements generated by the study and congressional  authorizations are difficult. Without knowing how many general and flag  officers each service contributes to the external (joint) community, we  cannot be certain of the exact number of personnel each service needs to  meet all of its commitments, internal and external. As shown in table 4,  Congress establishes authorizations by service. Congress does not provide  separate authorizations for external (joint) requirements, except for the  Chairman’s 12 exemptions from the overall service ceilings. External  (joint) requirements are filled from service authorizations.
In the general and flag officer study, internal (service-specific) positions  were separated from external (joint) positions. However, the study did not  show the extent to which each service contributed general and flag  officers from their authorizations to fill external (joint) requirements.  While service contributions to external (joint) requirements fluctuate  due to the rotational nature of these assignments, service contributions  can be determined at a given point in time. We used Joint Staff data from  December 2002 to determine which service was filling each of the  223 active component external (joint) requirements (see table 5) and each  of the 58 reserve component external (joint) requirements (see table 6)  validated by the general and flag officer study.
The data in tables 5 and 6 allow for a more direct comparison between  requirements and authorizations. For example, the Army’s authorization  for active duty generals is 302 plus the Army’s 5 exemptions for the  Chairman’s 12, for a total of 307 authorized general officers. According to  DOD’s requirements data, the Army needs 286 general officers to meet its  internal active component requirements. Based on the data in table 5,  Army general officers also filled 66 external (joint) requirements in the  active component. As a result, the Army had total active component  requirements—including internal and external—of 352 general officers,  compared with active component authorizations for 307 generals, a  difference of 45 generals. Using these calculations for the other services,  active component requirements exceeded active component  authorizations by 20 for the Air Force, 47 for the Navy, and 18 for the  Marine Corps. The actual differences between individual service  requirements and authorizations may be greater because the Joint Staff  data did not identify the service filling 20 of the external (joint) active  component requirements.
section_title: Reserve Forces Policy Board Had Minimal Role in Producing DOD’s 2003 Report
paragraphs: “The Secretary of Defense shall ensure that the Reserve Forces Policy Board participates in  the internal Department of Defense process for development of the recommendations of  the Secretary contained in the report under subsection (a).”
We noted during our review that the Reserve Forces Policy Board played a  minimal role in producing the DOD 2003 report. The Board was not  involved with the preparation of the general and flag officer study but was  given the opportunity to comment on the study and the draft DOD report  prior to its submission to Congress. The Board provided written comments  on the report in April 2003 concurring with DOD’s conclusion that all  current congressional authorizations for general and flag officers were  needed, but registering strong objections to DOD’s recommendation not to  seek additional authorizations now to meet validated requirements and to  the limited role it played in the overall process.
The Reserve Forces Policy Board had a more active role in DOD’s 1997  general and flag officer study. In a memorandum to the Secretary of  Defense, the Chairman of the Reserve Forces Policy Board at that time  indicated the Board was pleased with its level of participation in the 1997  study. The Chairman stated, “We believe our ‘independent voice’ is  captured in this report and trust our views will be appropriately  considered. We are pleased to share with you that [the Office of the  Secretary of Defense] and the Services wholeheartedly embraced our  participation. We were well represented at all levels of participation and  our views were objectively considered…. In our view, this report was truly  a Total Force effort.”
section_title: DOD Incorporated Lessons Learned From GAO’s Review of DOD’s 1997 General and Flag Officer Study
paragraphs: DOD, in conducting its 2003 general and flag officer requirements study,  incorporated some of the lessons learned from a GAO review of DOD’s  1997 study. A notable improvement was the use of a single methodology  and set of factors in the 2003 study to evaluate general and flag officer  positions across all the services and the joint community. DOD also  improved its tracking of study results and its documentation of  adjustments made by the services and the Joint Staff. As in 1997, DOD did  not identify and assess general and flag officer positions that could  conceivably be converted to the civilian workforce. However, DOD has  begun this assessment and expects to have results by July 2004.
subsections: section_title: 2003 Study Assessed General and Flag Officer Requirements Using a Single Methodology
paragraphs: In 1997, the services and Joint Staff each conducted separate reviews of  their general and flag officer requirements and, in doing so, used different  job evaluation methodologies and factors. We noted in our review of the  1997 study that differing methodologies made cross-service comparisons  difficult, even when comparing similar positions from one service to  another. The separate service reviews together created at least 24 different  definitions of a general or flag officer. At the time, the Office of the  Secretary of Defense stated that it permitted the services to use their own  methodologies for three reasons: (1) The methodology selected had to  recognize the unique mission and structure of each service. (2) There was  no single definition of a general and flag officer and no one way to conduct  job evaluations. The different methodologies were deemed valid. (3) Using  existing methodologies and recently completed studies saved time. We  stated that a single methodology, consistently applied, would have been a  better approach than using different methodologies.
In 2003, DOD used a single methodology and one set of factors to assess  all general and flag officer positions. The Office of the Secretary of  Defense, the services, and the Joint Staff representatives on the working  and senior panels worked together with LMI to conduct the study. DOD  officials we interviewed generally agreed with the approach of using a  single methodology and set of factors. One official who had also  participated in the 1997 study said the services had to spend time  defending their service-specific methodologies and findings. The use of a  single methodology in the 2003 study avoided this problem. The process  promoted interaction and discussion among the organizations represented  on the working and senior panels.
section_title: DOD Improved Tracking and Documentation of Adjustments to Study Results
paragraphs: In job evaluations, judgments and decisions by executives about job value  and study results are expected to be made as part of the process.  Adjustments made to study results on the basis of executive judgment  should be explained. In our review of DOD’s 1997 study, we found that  there were discrepancies between what the service secretaries  recommended and what their own service studies found and that these  discrepancies were not explained in DOD’s draft 1997 report. The service  secretaries recommended, in the aggregate, a total number of  authorizations that was 123 less than the number of requirements  identified by the service studies (995 recommended authorizations  compared with 1,118 requirements). When the service secretaries  developed their recommendations, they did not explain the basis for their  adjustments to the study results. We recommended that the Secretary of  Defense modify the draft 1997 report to include an explanation of the  criteria used by the service secretaries to modify the results of the  services’ studies.
For the 2003 study, we found that DOD tracked the adjustments made to  the requirements at each step in the process, from the time the positions  were originally submitted through final vetting by service and Joint Staff  senior leadership. DOD’s study showed the number of general and flag  officer positions originally submitted by the services and Joint Staff  (1,625), the number as assessed by LMI scorers (1,627), the number  approved by the senior panel (1,629), and the final study results following  a review by service and Joint Staff senior leadership (1,630). While net  adjustments in the total number of requirements were minimal (a net  increase of five positions), adjustments to the grades of individual  positions were made at each step in the process. These adjustments were  tracked in the requirements database.
Our analysis of the requirements database showed that LMI scorers made  adjustments to a total of 74 positions. Of these 74 positions, 20 had been  submitted as O-7/O-8 positions. LMI scored these 20 positions as belonging  at one grade or the other, with 8 positions being assessed as O-8 and  12 positions being assessed as O-7. The other 54 positions represented  “grade inversions,” where LMI scorers assessed the position at a pay grade  level different from that submitted. Of the 54 grade inversions, 47 were  downgrades (that is, for example, going from an O-8 to an O-7), and 7 were  upgrades. The senior panel then had an opportunity to adjust the results of  LMI’s scoring, and service and Joint Staff senior leadership vetted the  requirements and made their own adjustments before the study results  were finalized. The senior panel and the service and Joint Staff senior  leadership made adjustments to a total of 38 positions. All but 1 of these  38 adjustments involved positions scored as grade inversions by the LMI  scorers. (See app. II for more information on these 38 adjustments.)
We found that, in contrast with the 1997 study, the reasons for adjusting  the LMI scoring results were documented in most cases. DOD was able to  produce documentation, such as a spreadsheet and e-mail messages, to  explain most of the adjustments. Our review of this documentation  showed that an explanation was provided for 34 of the 38 adjustments and  was lacking for the other 4 adjustments. In a few cases, the documented  explanation was brief. For instance, the senior panel upgraded an Army  reserve position from O-7 (LMI’s scoring assessment) back to O-8 (the  grade as originally submitted). The panel’s rationale was as follows: “Keep  as O-8; important info left out; Dep Vice Cmdr for Homeland Defense;  $900m budget.” In other cases, the explanation for the adjustment was  more detailed. For example, the senior panel upgraded the President of  the Naval War College from O-8 (LMI’s scoring assessment) back to O-9  (the grade as originally submitted). To support this adjustment, the Navy  submitted a 2-page addendum to expand upon the original position  description.
section_title: DOD Deferred an Evaluation of General and Flag Officer Positions That Might Be Considered for Civilian Conversion
paragraphs: In 1997, we found that the services had not fully evaluated the potential for  military to civilian conversions as part of their general and flag officer  studies. We noted that the need for additional general and flag officers  could be reduced by converting general and flag officer positions that do  not require a uniformed servicemember to civilian status. At that time, we  recommended that the Secretary of Defense modify the draft 1997 report  to include an evaluation of the potential to convert nonmilitary essential  general and flag officer positions to civilian status.
As part of its 2003 study, DOD did not consider which positions could  conceivably be converted from the military ranks to the civilian  workforce. DOD stated in its March 2003 report to Congress that following  completion of the general and flag officer review, DOD would look at its  senior leadership requirements—military and civilian. “We must look at  the entire pool of senior leaders, to include DOD civilians, to assess how  many we need overall to effectively manage the Department,” the report  stated. “Once we have agreement on an overall number, we will seek  additional flexibility to manage within an overall ceiling and assign the  best qualified individual where needed.”
In July 2003, DOD approved a contract with LMI to assess general and flag  officer positions for potential civilian conversion. The statement of work  calls for LMI to perform a “billet-by-billet assessment of each validated  general and flag officer requirement to determine whether the position  could be filled by a senior civilian.” DOD has commissioned separate  studies to assess Senior Executive Service requirements. An official in the  Office of the Secretary of Defense said the LMI civilian conversion study  will pave the way for analysis of future legislative and policy proposals.  LMI is to provide study results within a year of the contract date.
section_title: Conclusions
paragraphs: DOD’s March 2003 report to Congress did not provide complete  information on whether general and flag officer authorizations were  sufficient to meet all requirements. Specifically, DOD’s 2003 report to  Congress did not fully disclose the results from its general and flag officer  study or address the magnitude or the impact of the gap between  requirements and authorizations. Fully disclosing the study results and  discussing the implications of its findings would help to explain DOD’s  recommendation not to seek additional authorizations. In addition, the  methodology used in the study was not designed to capture new or  emerging needs that could result from DOD transformation efforts or  other changes in the department. Such changes could be captured through  periodic updates to the requirements validated through the 2003 study. In  the absence of periodic updates, the validated requirements could become  out-of-date. DOD also could enhance the precision of the requirements  data by more clearly accounting for dual-hatted positions and could  enhance the usefulness of the results by assessing the impact of external  (joint) requirements on service authorizations. Finally, the requirements  data could be improved by incorporating the results of the ongoing civilian  conversion study.
Addressing these issues would help DOD establish a solid baseline of  validated general and flag officer requirements that will assist DOD as it  assesses senior leadership (civilian/military) requirements and manages  general and flag officers. In addition, clarification of DOD’s requirements  would assist congressional decision makers in making adjustments to the  maximum number of general and flag officers authorized to each service.
section_title: Recommendations for Executive Action
paragraphs: We recommend that the Secretary of Defense direct the Under Secretary  of Defense for Personnel and Readiness to take the following four actions:    Clarify the magnitude and impact of the gap between DOD’s validated  requirements for general and flag officers and congressional  authorizations. This assessment should include (1) an analysis of the  impact caused by the workarounds DOD uses to fill the gap between  requirements and authorizations and (2) a more complete explanation of  its recommendation not to seek additional authorizations in light of the  study results showing that requirements exceeded authorizations.
Update general and flag officer requirements periodically by identifying,  assessing, and validating new general and flag officer requirements that  emerge from DOD transformation efforts or other changes in the  department.
Take steps to enhance the precision and usefulness of the general and flag  officer requirements. At a minimum, DOD should more clearly account for  all dual-hatted positions in terms of whether each position is dual-hatted  for efficiency or out of necessity due to shortages in general and flag  officer authorizations. Positions that are dual-hatted out of necessity  should be treated as separate positions for purposes of identifying  requirements. In addition, to the extent possible, DOD should track service  contributions of general and flag officers to external (joint) requirements  to assess whether each service’s authorizations are sufficient to meet both  internal and external requirements.  Incorporate the results of the ongoing civilian conversion study in a future  update of general and flag officer requirements.
section_title: Agency Comments and Our Evaluation
paragraphs: DOD provided written comments on a draft of this report. In its comments,  DOD concurred with our recommendations and indicated that it will  (1) address the impact of the gap in requirements and the use of  workarounds in a separate study on alternative methods for dealing with  the gap in requirements, (2) review all dual-hatted positions and add the  additional information to the established requirements database, and  (3) incorporate the results of the ongoing civilian conversion study in a  future update of general and flag officer requirements. Regarding our  recommendation to periodically update general and flag officer  requirements, DOD indicated that its current procedures were adequate.  However, as we stated in our report, these additional requirements are not  going through the kind of job evaluation assessment and validation DOD  used in its study. DOD could use the methodology developed for the  baseline study to ensure that any additional requirements are validated.  As we noted in our report, the assessment process resulted in validated  requirements that in some cases differed from the requirements  originally submitted by the services and the Joint Staff. Regarding our  recommendation that DOD track the military services’ contributions of  general and flag officers to external (joint) requirements, DOD stated that  it will closely monitor service participation in this arena and that current  safeguards mitigate the impact of joint participation. We continue to  believe that an assessment of whether general and flag officer  authorizations are sufficient to meet all requirements necessitates the  inclusion of both internal service as well as external (joint) requirements.  Furthermore, this assessment should be made at the service level because  Congress has established service-specific authorization levels. DOD’s  comments are reprinted in their entirety in appendix III. DOD also  provided technical comments, which we have incorporated as appropriate.
section_title: Scope and Methodology
paragraphs: To determine whether DOD fully disclosed the results of its general and  flag officer study in its March 2003 report to Congress and explained the  rationale for any recommendations, we obtained and analyzed the  results of the general and flag officer study, the database of validated  requirements, supporting documentation, and the March 2003 report. We  also reviewed laws and regulations pertaining to general and flag officers.  We discussed the study with, and obtained documentation from,  representatives of the Under Secretary of Defense for Personnel and  Readiness, the Office of General Counsel (Office of the Secretary of  Defense), LMI, and the military services’ and Joint Staff’s general officer  matters offices. We also reviewed the Reserve Forces Policy Board’s  comments on the general and flag officer study, met with Board staff, and  obtained documentation concerning the Board’s involvement in the study.  The scope of our review did not include an assessment of  recommendations made by DOD concerning the management of general  and flag officers. We plan to conduct a separate review of these  management issues and recommendations.
To assess the methodology used in the 2003 study, we reviewed prior DOD  studies of general and flag officer requirements and the results of our  review of DOD’s 1997 study, for which we had conducted an extensive  literature review on job evaluation methods. We also reviewed a study by a  public policy research contractor, contacted another outside researcher  who was familiar with the study, and reviewed other literature on job  evaluation. We reviewed the steps used to conduct the 2003 study and the  origin and application of factors used in the assessment. We discussed the  methodology with DOD and LMI officials. We also determined how the  study accounted for dual-hatted positions and external (joint)  requirements. Regarding dual-hatted positions, we examined selected  positions from the requirements database. We also compared dual-hatted  positions in the database with service and DOD-wide rosters of general  and flag officers. Regarding external (joint) requirements, we examined  Joint Staff data to determine the services’ contributions to meeting  validated external (joint) general and flag officer requirements. We did not  review the study findings to determine whether requirements for  individual positions were validated appropriately through the study.
To determine whether DOD incorporated lessons learned from our review  of DOD’s 1997 general and flag officer study, we reviewed the findings and  recommendations from our 1997 review and compared these lessons  learned to the approach used in the 2003 study. To assess the tracking and  documentation of adjustments made to study results, we analyzed the  requirements database. We then obtained from DOD documentation  concerning adjustments that were made to the study results by the senior  panel and the service and Joint Staff senior leadership. We also reviewed  DOD’s plans for a follow-on study concerning conversion of general and  flag officer positions to the civilian workforce.
We are sending copies of this report to the Secretary of Defense and the  Director, Office of Management and Budget. In addition, the report will be  available at no charge on GAO’s Web site at http://www.gao.gov.
If you or your staff have any questions regarding this report, please  contact me at (202) 512-5559 (stewartd@gao.gov) or Brenda S. Farrell at  (202) 512-3604 (farrellb@gao.gov). Major contributors to this report were  Thomas W. Gosling, J. Paul Newton, and Bethann E. Ritter.
section_title: Appendix I: Sixteen Factors Used to Validate General and Flag Officer Requirements
subsections: section_title: Nature of the Position
paragraphs: 1. Characteristics of function  a. Type (e.g., command, general or coordinating staff, special staff,  manager, deputy, specialist, etc.)  b. Scope (e.g., operational command, training command, installation  command, personnel management, officer personnel management,  legal affairs, information, etc.)  c. Level of function (e.g., national, secretarial, service, theater, field  command, etc.)  2. Grade and position of   c. lateral points of coordination  (relative position within the military or governmental structure within  which the position’s function is performed)  3. Supervision over position  a. Proximity (remoteness or closeness of supervision)  b. Degree (independence of operation)  4. Official relations with U.S. and foreign governmental officials and with  the public  a. Nature (e.g., reports to, works for, keeps informed, provides  liaison, etc.)  b. Extent (e.g., primary function, frequent requirement, continuous  additional duty, occasional requirement, etc.)  c. Level of official relations with U.S. and foreign governmental  officials and with the public (e.g., governmental department or agency,  national or local government, civil organizations, industry, press,  non-governmental organizations , private volunteer  organizations , etc.)  5. Reflection of national emphasis and determination (relation of position  to national objectives and programs, special conditions under which the  position was first established or other reasons why the position reflects  national will)  6. Special qualifications required by the position (any special qualifications  such as advanced education, or particular training or experience, which  are essential to the proper execution of positional responsibilities)
section_title: Magnitude of Responsibilities
paragraphs: 7. Mission(s) of organization and the special requirements of the position  as it relates to the mission(s) (the nature of the responsibilities that are  associated with the position and the need for multidimensional “executive  skills.” The mission of the organization is the key, day-to-day activities that  are accomplished.)  8. Number, type, and value of resources managed and employed. Data  should be displayed within three categories: operational control,  administrative control, and immediate staff within each subsection.  a. Military forces (number and type of forces normally assigned or  programmed for planned or special operations)  b. Personnel (number of personnel by officer and warrant officer,  enlisted, and civilian)  c. Value of equipment and properties (total value of equipment,  supplies, and real property displayed in millions)  e. Foreign resources (scope and type of foreign resources involved,  if any)  9. Geographical area of responsibilities (the size, location, and, if  appropriate, the criticality of the land, sea, or air spaces involved)  10. Authority to make decisions and commit resources (the scope of the  position with respect to specific authority delegated to or withheld from  the position in either routine or emergency situations)  11. Development of policy (involvement in the development of policy  within the specific functional areas associated with the position, e.g.,  budget, program, communications, or manpower)  12. National commitment to international agreements (authority to make  commitments to foreign nations or involvement in negotiating such  commitments for the United States)  13. Auxiliary (supporting) authorities and responsibilities inherent in the  position (inherent requirements charged to the position by virtue of  situation, location, proximity, tradition, etc.)
section_title: Significance of Actions and Decisions
paragraphs: 14. Impact on national security or other national interests (effect of  mission accomplishment or position performance on the protection of  national interests or the advancement of national programs)  15. Importance to present and future effectiveness and efficiency of the  national defense establishment (effect on the force structure, operational  capabilities, status of combat readiness, quality of personnel and  equipment, cost effectiveness, command and control means, management  procedures and techniques, responsiveness to national needs, or other  factors)  16. Effect on the prestige of the nation or the armed forces (how  effectiveness or accomplishment reflects on the stature of the nation and  its armed forces, and influences the credibility of national aims and  capabilities)
section_title: Appendix II: Adjustments Made to General and Flag Officer Requirements After LMI’s Scoring Assessment
paragraphs: This appendix lists the 38 general and flag officer positions where  adjustments were made after the Logistics Management Institute (LMI)  scorers conducted their assessment. The Department of Defense (DOD)  components (the military services and Joint Staff) submitted the pay grade  level for each general and flag officer position reviewed. LMI scorers  assessed the positions to validate the grade level. The senior panel  reviewed the results of LMI’s scoring assessment, made adjustments, and  approved the validated requirements. The requirements were then vetted  through the senior leadership of the services and the Joint Staff, who  requested further adjustments. With these adjustments, the study results  were finalized. Table 7 shows, for each of the 38 positions, the adjustments  to the position’s pay grade as approved by the senior panel and vetted  through the senior leadership.
section_title: Appendix III: Comments From the Department of Defense