DOD Civilian Personnel: Comprehensive Strategic Workforce Plans Needed
Published: 2004-06-30T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: During its downsizing in the early 1990s, the Department of Defense (DOD) did not focus on strategically reshaping its civilian workforce. GAO was asked to address DOD's efforts to strategically plan for its future civilian workforce at the Office of the Secretary of Defense (OSD), the military services' headquarters, and the Defense Logistics Agency (DLA). Specifically, GAO determined: (1) the extent to which civilian strategic workforce plans have been developed and implemented to address future civilian workforce requirements, and (2) the major challenges affecting the development and implementation of these plans.
section_title: What GAO Found
paragraphs: OSD, the service headquarters, and DLA have recently taken steps to develop and implement civilian strategic workforce plans to address future civilian workforce needs, but these plans generally lack some key elements essential to successful workforce planning. As a result, OSD, the military services' headquarters, and DLA--herein referred to as DOD and the components--do not have comprehensive strategic workforce plans to guide their human capital efforts. None of the plans included analyses of the gaps between critical skills and competencies (a set of behaviors that are critical to work accomplishment) currently needed by the workforce and those that will be needed in the future. Without including gap analyses, DOD and the components may not be able to effectively design strategies to hire, develop, and retain the best possible workforce. Furthermore, none of the plans contained results-oriented performance measures that could provide the data necessary to assess the outcomes of civilian human capital initiatives. The major challenge that DOD and most of the components face in their efforts to develop and implement strategic workforce plans is their need for information on current competencies and those that will likely be needed in the future. This problem results from DOD's and the components' not having developed tools to collect and/or store, and manage data on workforce competencies. Without this information, it not clear whether they are designing and funding workforce strategies that will effectively shape their civilian workforces with the appropriate competencies needed to accomplish future DOD missions. Senior department and component officials all acknowledged this shortfall and told us that they are taking steps to address this challenge. Though these are steps in the right direction, the lack of information on current competencies and future needs is a continuing problem that several organizations, including GAO, have previously identified.

section_title: Letter
paragraphs: The achievement of the Department of Defense’s (DOD) mission is  dependent in large part on the skills and expertise of its civilian  workforce. DOD’s civilian workforce, among other things, develops policy,  provides intelligence, manages finances, and acquires and maintains  weapon systems. During its downsizing in the early 1990s, DOD did not  focus on reshaping the civilian workforce in a strategic manner. This  downsizing has resulted in a workforce characterized by a growing gap  between older, experienced employees and younger, less experienced  ones. With more than 50 percent of its civilian personnel becoming eligible  to retire in the next 5 years, DOD may find it difficult to fill certain  mission-critical jobs with qualified personnel. The problem is exacerbated  by today’s emerging security threats and rapidly evolving technology.  Civilian personnel have been deployed along with military personnel to  participate in operations such as Iraqi Freedom, Desert Storm, Bosnia, and  Kosovo. In addition, technological advances have generated the need for a  DOD civilian workforce with more advanced education and greater  technological skills.
DOD has undertaken several human capital reforms that will affect its  future civilian workforce of approximately 700,000 personnel. One major  initiative is DOD’s creation of a new human capital management system,  the National Security Personnel System (NSPS), which will give the  department significant flexibility for creating a new framework of rules,  regulations, and processes to govern the way civilians are hired,  compensated, promoted, and disciplined. In addition, DOD has undertaken  efforts to convert over 20,000 military positions to civilian positions in  fiscal years 2004 and 2005, and more conversions are to be addressed in  fiscal year 2006 and the out-years. Futhermore, DOD was granted  permanent authority beginning in fiscal year 2004 to extend buyouts to as  many as 25,000 civilian employees each year to downsize or restructure  the workforce to meet mission objectives. For these and other human  capital reforms to have maximum effectiveness and value, it is critical that  DOD engage in effective strategic workforce planning.
Leading public-sector organizations have found that strategic human  capital management must be the centerpiece of any serious change  management initiative to transform the culture of government agencies.  Strategic workforce planning, an integral part of human capital  management, helps ensure that an organization has the staff with the  necessary skills and competencies to accomplish its strategic goals.  Critical skills are core mission and support occupations that are vital to  the accomplishment of an agency’s goals and objectives. Competencies are  a set of behaviors that encompass knowledge, skills, abilities, and personal  attributes that are critical to successful work accomplishment. They  describe what employees know, what they do, and how they do it and  translate into effective on-the-job performance. Strategic workforce  planning is an iterative, systematic process that addresses two critical  needs: (1) aligning an organization’s human capital program with its  current and emerging mission and programmatic goals and (2) developing  long-term strategies for acquiring, developing, and retaining an  organization’s workforce to achieve programmatic goals. The strategic  workforce planning process includes five elements used by leading public-  and private-sector organizations: (1) involvement of management,  employees, and stakeholders in developing, communicating, and  implementing strategic workforce plans; (2) performing analyses to  identify critical skill and competency gaps between current and future  workforce needs; (3) developing strategies to fill these skill and  competency gaps; (4) building the capability necessary to address  administrative, educational, or other requirements to support workforce  strategies; and (5) monitoring and evaluating progress and the  contribution of strategic workforce planning efforts in achieving program  goals.
In recent years, we have examined various aspects of DOD’s human  capital management of its civilian workforce. For example, in March 2000,  we testified that a strategic approach should be used to guide DOD civilian  workforce management. We further testified that DOD must define the  kind of workforce it will need in the coming years, develop plans for  creating that workforce, and follow up with the actions and investments  needed so that the right employees—with the right skills, training, tools,  structures, and performance incentives—will be on hand in the years to  come. In March 2003, we reported on the department’s strategic planning  efforts for civilian personnel both at DOD and selected defense  components. In that report we recommended that the Secretary of  Defense strengthen civilian human capital planning, including integration  with military personnel and sourcing initiatives. DOD did not concur with  our recommendation and stated that 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. In  April 2003, we issued a report on DOD’s strategic workforce planning  efforts for its civilian industrial workforce. We recommended, among  other things, that the Secretaries of the services and the Commandant of  the Marine Corps improve the quality and comprehensiveness of the  services’ workforce planning efforts for civilian industrial employees. DOD  concurred with most of our recommendations and highlighted the  importance the department places in human capital management.
In our 2001 High-Risk Series and Performance and Accountability Series  and again in 2003, we designated strategic human capital as a high-risk  area and stated that serious human capital shortfalls are threatening the  ability of many federal agencies to economically, efficiently, and  effectively perform their missions.
This report addresses DOD’s efforts to strategically plan for its future  civilian workforce at the Office of the Secretary of Defense (OSD), the  military services’ headquarters, and the Defense Logistics Agency (DLA).  As agreed with your office, we determined (1) the extent to which civilian  strategic workforce plans have been developed and implemented to  address future civilian workforce requirements and (2) the major  challenges affecting the development and implementation of civilian  strategic workforce plans.
To determine the extent to which OSD, the military services’ headquarters,  and DLA (hereinafter referred to as “DOD and the components”) have  developed and implemented strategic workforce plans to address future  civilian workforce requirements, we obtained their workforce planning  documents and evaluated their strategic workforce planning efforts in  terms of the five strategic workforce planning elements noted above. We  tested the reliability of selected Defense Civilian Personnel Data System  data used for workforce analysis and reviewed the internal controls  related to the management of the system. We determined that the data  were sufficiently reliable to meet our objectives. To determine what  challenges affect OSD’s, the service headquarters’, and DLA’s development  and implementation of civilian strategic workforce plans, we interviewed  officials and obtained, reviewed, and analyzed documentation to identify  the challenges that affect planning. We conducted our review from April  2003 through June 2004 in accordance with generally accepted  government auditing standards. Further details on our scope and  methodology are presented in appendix I. A list of recent GAO products  related to federal agencies’ management of human capital is included at  the end of this report.
subsections: section_title: Background
paragraphs: With almost 700,000 civilian employees on its payroll, DOD is the second  largest federal employer of civilians in the nation, after the Postal Service.  The achievement of DOD’s mission is dependent in large part on the skills  and expertise of its civilian workforce. DOD’s civilian workforce, among  other things, develops policy, provides intelligence, manages finances, and  acquires and maintains weapon systems. Because of the global war on  terrorism, the role of DOD’s civilian workforce is expanding to include  participation in combat support functions, thus enhancing the availability  of military personnel to focus on warfighting duties for which they are  uniquely qualified. Career civilian personnel possess “institutional  memory,” which is particularly important in DOD because of the frequent  rotation of military personnel and the short tenure of the average political  appointee.
Since the end of the Cold War, the civilian workforce has undergone  substantial change, due primarily to downsizing, base realignments and  closures, competitive sourcing initiatives, and DOD’s changing mission.  For example, between fiscal years 1989 and 2002, DOD’s civilian  workforce shrank from 1,075,437 to 670,166—about a 38 percent  reduction. As of December 30, 2003, DOD’s civilian workforce was down  to 655,545 employees. DOD performed this downsizing without proactively  shaping the civilian workforce to ensure that it had the specific skills and  competencies needed to accomplish future DOD missions. A consequence  of this lack of attention to force shaping can be seen in the age distribution  of the civilian workforce in comparison to the distribution at the start of  the drawdown. Today’s workforce is older and more experienced, but 57  percent of the workforce will be eligible for early or regular retirement in  the next 5 years.
As shown in figure 1, as of December 30, 2003, the military services  employed about 85 percent of DOD’s civilians; 15 percent were employed  by other defense organizations.
Air Force (152,029)
Navy (180,302)
subsections: section_title: DOD Civilian Human Capital Reforms
paragraphs: DOD has undertaken several human capital reforms that will affect the  future civilian workforce. In November 2003, Congress, in making  authorizations for DOD, authorized the Secretary of Defense to establish a  new human capital management system, the National Security Personnel  System. The law granted DOD exemptions from laws governing federal  civilian personnel management found in title 5 of the United States Code.  Congress provided these flexibilities in response to DOD’s position that  the inflexibility of federal personnel systems was one of the most  important constraints to the department’s ability to attract, retain, reward,  and develop a civilian workforce to meet the national security mission of  the 21st century. The NSPS will give the department significant flexibility  for creating a new framework of rules, regulations, and processes to  govern the way that civilians are hired, compensated, promoted, and  disciplined.
Congress also granted DOD other new personnel flexibilities, including  permanent authority to extend separation incentives (commonly referred  to as “buyouts”) to induce as many as 25,000 civilians to voluntarily leave  federal service. These separation incentives may be used to, among other  things, reshape or reduce the department’s civilian workforce. In  December 2003, the Under Secretary of Defense for Personnel and  Readiness authorized the military services’ headquarters and DOD  components to immediately initiate buyouts as long as affected employees  leave government service during fiscal year 2004.
In addition, DOD has undertaken efforts to expand the use of its civilian  workforce to perform combat support functions traditionally performed  by military personnel. In December 2003, the Under Secretary of Defense  (Comptroller) directed the military services to convert over 20,000 military  positions to civilian positions in fiscal years 2004 and 2005; more  conversions are to be addressed in fiscal year 2006 and the out-years.
section_title: Strategic Workforce Planning
paragraphs: Studies by several organizations, including GAO, have shown that  successful organizations in both the public and private sectors use  strategic management approaches to prepare their workforces to meet  present and future mission requirements. We have found that these  organizations have used strategic workforce planning as a management  tool to develop a case for human capital investments and to anticipate and  prepare for upcoming human capital issues that could jeopardize the  accomplishment of goals. Strategic human capital planning begins with  establishing a clear set of organizational intents—including a clearly  defined mission, core values, goals and objectives, and strategies—and  then developing an approach to support these strategic and programmatic  goals. Strategic workforce planning, an integral part of human capital  management, requires systematic assessments of current and future  human capital needs and strategies—which encompass a broad array of  initiatives to attract, retain, develop, and motivate a top-quality  workforce—to fill the gaps between an agency’s current and future  workforce needs. Approaches to such planning vary according to agency- specific needs and mission, but our work suggests that, irrespective of the  context in which planning is done, such a process should address five key  elements (see fig. 2):  1.  Involvement of management and employees: Efforts that address key  organizational issues, like strategic workforce planning, are most likely  to succeed if, at their outset, agencies’ top program and human capital  leaders set the overall direction, pace, tone, and goals of the effort, and  involve employees and stakeholders in establishing a communication  strategy that creates shared expectations for the outcomes of the  process.  2.  Workforce gap analysis: Identifying whether gaps exist between the  current and future workforces needed to meet program goals is critical  to ensuring proper staffing. The absence of fact-based gap analyses can  undermine an agency’s efforts to identify and respond to current and  emerging challenges. The analysis of the current workforce should  identify how many personnel have the skills and competencies needed  to meet program goals and how many are likely to remain with the  agency over time, given expected losses due to retirement and other  attrition. The characteristics of the future workforce should be based  on the specific skills and competencies that will be needed. The  workforce gap analyses can help justify budget and staff requests by  linking the program goals and strategies with the budgetary and staff  resources needed to accomplish them.  3.  Workforce strategies to fill the gaps: Developing strategies to address  any identified workforce gaps in critical skills and competencies  creates the road map needed to move from the current to the future  workforce. Strategies address how the workforce is acquired,  developed and trained, deployed, compensated, motivated, and  retained.  4.  Build-up of capability to support workforce strategies: As agencies  develop tailored workforce plans and the administrative, educational,  and other requirements that are important to support them, it is  especially important to educate managers and employees about the  human capital flexibilities so that the flexibilities are implemented  openly, fairly, and effectively.  5.  Evaluation of and revisions to strategies: Evaluating the results of the  workforce strategies and making needed revisions helps to ensure that  the strategies work as intended. A key step is developing results- oriented performance measures as indicators of success in attaining  human capital goals and program goals, both short- and long-term.  Periodic measurement and evaluation provide data for identifying  shortfalls and opportunities to revise workforce plans as necessary.
These concepts are especially relevant in considering the human capital  reforms that DOD has under way that will fundamentally change the way it  manages its civilian workforce. Because DOD is one of the largest  employers of federal civilian employees, how it approaches human capital  management sends important signals about trends and expectations for  federal employment across the government. More importantly, the role  that DOD’s civilian workforce plays in support of our national security  makes DOD’s approach to managing its people a matter of fundamental  public interest.
section_title: Guidance for Managing Strategic Workforce Planning
paragraphs: Four agencies—GAO, the Office of Management and Budget (OMB), the  Office of Personnel Management (OPM), and the Office of the Under  Secretary of Defense for Personnel and Readiness (OUSD/P&R)—have  developed guidance for human capital management and workforce  planning. Highlights of this guidance are presented in table 1.
Congress has additionally recognized the importance of workforce  planning and, in 2002, added to the Government Performance and Results  Act a provision requiring the Chief Human Capital Officer of each agency  to prepare an annual plan that provides a description of how the  performance goals and objectives are to be achieved, including the  operation processes, training, skills, and technology, and the human  capital, information, and other resources and strategies required to meet  those performance goals and objectives.
section_title: Steps Have Been Taken to Develop and Implement Strategic Workforce Plans, but Some Key Elements Are Lacking
paragraphs: Although the DOD and the components have taken steps to develop and  implement strategic workforce plans, the plans lack some key planning  elements. As a result, the plans are not comprehensive. DOD and most of  the components we reviewed have involved top-level management, staff,  and stakeholders in the development and implementation of their strategic  workforce plans; however involvement has been limited in the Navy but  increasing. The strategic workforce plans have also included the  identification of critical skills currently needed by the workforce and  those needed in the future, as well as administrative, educational, and  other requirements developed to support workforce strategies. However,  the plans are not comprehensive because they lack some key elements  essential for successful workforce planning. For example, the strategic  workforce plans lacked analyses of gaps in critical skills and  competencies, human capital strategies derived from analyses that  identified such gaps, and results-oriented performance measures.
subsections: section_title: DOD and Components Have Taken Some Strategic Workforce Planning Steps
paragraphs: DOD and most of the components we reviewed have involved top-level  management, staff, and stakeholders in the development and  implementation of their strategic workforce plans. However, involvement  has been limited but increasing in the Navy. The strategic workforce plans  have also included the identification of critical skills currently needed by  the workforce and those that will be needed by the workforce in the  future, as well as agencywide plans and procedures to support workforce  strategies. Table 2 provides an overview of the steps taken by DOD and the  components toward developing and implementing strategic workforce  plans in terms of the five key strategic workforce planning elements.
section_title: Strategic Workforce Plans Lack Some Key Elements
paragraphs: While DOD and the components have taken steps to develop and  implement civilian strategic workforce plans, their plans generally lacked  some key elements essential to successful workforce planning.
Specifically, none of the plans included analyses of gaps between the  critical skills and competencies currently needed by the workforce and  those that will be needed in the future. As a result, none of the human  capital strategies contained in the strategic workforce plans were derived  from analyses that identified gaps in critical workforce skills or  competencies needed by DOD and the components to meet future  strategic goals. Furthermore, none of the plans contained results-oriented  performance measures. As a result, DOD and the components do not have  comprehensive strategic workforce plans to guide their human capital  efforts. Without comprehensive strategic workforce plans, DOD and the  components may not know the competencies of the current and future  staff, what gaps exist in skills and competencies, and what their workforce  strategies should be. This is especially important as changes in national  security, technology, budget constraints, and other factors alter the  environment within which DOD operates.
subsections: section_title: Strategic Workforce Plans Did Not Analyze Critical Skills and Competency Gaps
paragraphs: As previously discussed, the civilian strategic workforce plans we  reviewed included information about the current and future critical skills.  However, none of the plans included analyses of gaps between the critical  skills and competencies currently needed and those needed in the future.  GAO and others have reported that it is important to analyze future  workforce needs to (1) assist organizations in tailoring initiatives for  recruiting, developing, and retaining personnel to meet their future needs  and (2) provide the rationale and justification for obtaining resources and,  if necessary, additional authority to carry out those initiatives. We also  stated that to build the right workforce to achieve strategic goals, it is  essential that organizations determine the critical skills and  competencies—a set of behaviors that encompass knowledge, skills,  abilities, and personal attributes—that are critical to successful work  accomplishment. To do so, the following data are needed:    What is available—both current workforce characteristics and future  availability. This is accomplished by assessing the current workforce— defining the number and types of competencies for employees in each  occupational group; determining the skill levels for each competency; and  assessing how they will evolve over time, factoring in such events as  retirements.
What is needed—the critical workforce characteristics needed in the  future. This is accomplished by analyzing the future workforce— developing specifications for the kinds, numbers, and location of  personnel it will need to address its future challenges.
What is the difference between what will be available and what will be  needed—that is, the gap. This is especially important as changes in  national security, technology, and other factors alter the environment  within which DOD and the components operate.
We reported that DOD and the four military services lacked information  about their future workforce needs in a March 2003 report on strategic  planning efforts for civilian personnel. We pointed out that a National  Academy of Public Administration study noted DOD’s increasing reliance  on contractor personnel, and its need for civilian personnel expertise to  protect the government’s interest and ensure effective oversight of  contractors’ work. We recommended that DOD define the future civilian  workforce, identifying the required characteristics (e.g., the skills and  competencies, number, deployment, etc.) of personnel needed, and  determine the workforce gaps that needed to be addressed through human  capital initiatives. DOD did not concur with our recommendation and  stated that this action was already being accomplished through  information provided to OMB and OPM for the President’s Management  Agenda Scorecard. However, DOD did not provide us with this  information during the course of our prior review. Based on our current  review of the data being supplied to OMB and OPM, we determined that  the data are not sufficiently comprehensive to fully address the broader  elements of workforce planning that we have endorsed to ensure that  workforce data be compiled and analyzed as an integral part of the  strategic workforce planning process and factored into planning for  human capital initiatives.
section_title: Workforce Strategies Generally Not Derived from Analyses of Critical Skills and Competency Gaps
paragraphs: Though DOD and the components have implemented various strategies to  address expected workforce imbalances, these strategies have not been  derived from analyses of gaps between the critical skills and competencies  currently needed by the workforce and those that will be needed in the  future. Without analyzing critical skills and competency gaps, DOD and the  components may not be able to design and invest in strategies that will  effectively and efficiently transition to the future workforce they desire  and need.
Applying this principle to strategic workforce planning means that  agencies consider how hiring, training, staff development, performance  management, and other human capital strategies can be used to close gaps  and gain the critical skills and competencies needed in the future. GAO  and others have reported that it is important to analyze future workforce  needs to assist organizations in tailoring initiatives for recruiting,  developing, and retaining personnel to meet their future needs, and to  provide the rationale and justification for obtaining and targeting  resources and, if necessary, additional authority to carry out those  initiatives. Although not based on formal analyses of skills and  competency gaps, DOD and the components have implemented various  recruitment, retention, training and professional development, and  compensation strategies to address workforce imbalances.
The Army is planning to hire more entry-level professional, administrative,  and technical personnel through its career intern program in preparation  for expected retirements of civilians in leadership positions. In addition, it  is offering bonuses for engineers, scientists, and computer specialists;  accelerated promotions for engineers; permanent change-of-station moves  for all interns; and in some cases, advanced in-hire pay rates. According to  the Army, all of these initiatives will help grow the leaders of tomorrow,  accomplish the necessary transfer of institutional knowledge, and restore  a more balanced age distribution to the Army’s workforce.
The Navy (including the Marine Corps) has implemented a variety of  recruitment, retention, and retirement strategies to address its aging  civilian workforce. One particular strategy involves hiring retired military  personnel, who are well-seasoned employees already familiar with the  knowledge and skills necessary to maintain the Navy’s mission.
The Air Force has developed a strategy centered on enhancing recruitment  efforts, investing in the workforce through skill proficiency training and  leadership development, and establishing incentives for force shaping. As  of April 2004, the Air Force had hired 1,381 interns since fiscal year 2000.  According to the Air Force, the intern program is a key element of the Air  Force renewal effort. In addition, the Air Force believes that force  development plays a central role in creating a workforce that is ready for  the challenges of its aerospace mission to ensure the orderly transfer of  institutional knowledge as well as develop new skills for the aerospace  mission. According to an Air Force official, in fiscal year 2002, the Air  Force invested $9 million in civilian leadership training as a direct result of  its aging workforce profile.
DLA has created a Corporate Intern Program that provides systematic  training and on-the-job training work experience. DLA plans to hire  approximately 150 interns per year through fiscal year 2007. According to  a DLA official, 518 interns had been hired since 2000. DLA developed a  Professional Enhancement Program to help high-potential employees in  grades 12 to 15 to increase their knowledge and/or skills.
While these strategies are important efforts to help shape DOD’s and the  components’ future as the current workforce becomes eligible for  retirement, these strategies have not been derived from analyses of gaps  between the critical skills and competencies currently needed by the  workforce and those that will be needed in the future. Therefore, it is  unknown whether these strategies will lead to a desirable future  workforce that will help attain programmatic goals.
section_title: Strategic Workforce Plans for Civilian Personnel Lack Results-Oriented Performance Measures to Monitor and Evaluate Progress
paragraphs: DOD and the components have not developed results-oriented  performance measures to provide a basis for evaluating workforce  planning effectiveness. Thus, DOD and the components cannot gauge the  extent to which their human capital initiatives contribute to achieving  their organizations’ missions. Performance measures, appropriately  designed, can be used to gauge two types of success: (1) progress toward  reaching human capital goals and (2) the contribution of human capital  activities toward achieving programmatic goals. These measures can also  improve the effectiveness of workforce planning strategies, the overall  workforce planning process, and oversight, by identifying shortfalls in  performance and other improvement opportunities, such as corrective  actions that can be incorporated into the next planning cycle. Without  results-oriented measures, it is difficult for an organization to assess the  effectiveness of its human capital initiatives in supporting its overarching  mission and goals.
DOD and the components have not defined practical, meaningful measures  that assess the effectiveness of human capital management. For example,  DOD’s fiscal year 2003 Annual Report on civilian human resources  emphasized the department’s efforts to achieve activity-oriented goals,  such as employee satisfaction with DOD employment, diversity in  management positions, and new hire turnover rates. While this is useful  for tracking DOD’s progress, it does not gauge how well DOD’s human  capital efforts helped the department achieve its programmatic goals. As a  result, the link between specific human capital strategies and strategic  program outcomes is not clear.
section_title: Need for Information on Current and Future Workforce Competencies Is the Major Challenge to Effective Strategic Workforce Planning
paragraphs: The major challenge that DOD and most of the components face in their  efforts to develop and implement strategic workforce plans is their need  for information on current workforce competencies and the competencies  they anticipate needing in the future. This problem results from DOD’s and  the components’ not having developed tools to collect and/or store, and  manage data on workforce competencies that are critical to successful  work accomplishment. As a result, it is not clear whether they are  designing and funding workforce strategies that will effectively shape the  civilian workforce with the appropriate competencies needed to  accomplish future DOD missions.
Effective workforce planning requires that human capital staff and other  managers base their workforce analyses and human capital decisions on  complete, accurate, and timely personnel data. Senior department and  component officials all acknowledged this shortfall, and told us that they  are taking steps to address this challenge. Though these are steps in the  right direction, the lack of information on current competencies and future  needs is a continuing problem that several organizations, including GAO,  have previously identified.
In our March 2003 report on DOD strategic human capital management,  we reported that DOD had begun adopting the Army’s Civilian Forecasting  System and its Workforce Analysis Support System for departmentwide  use. According to DOD, those systems are still being evaluated by the  Strategic Integration Division in the Civilian Personnel Management  Service (CPMS) at OSD and CPMS is trying to make this software easier to  use. However, the systems do not collect, store, and manage data on  current and future competencies. The Army is working with OPM to link  its Civilian Forecasting System and Workforce Analysis Support System to  OPM’s Human Resources Management database to perform competency  forecasts.
In April 2001, the Army commissioned a contractor to, among other things,  assist in assessing its civilian workforce and to develop new concepts for  workforce planning. The contractor concluded that the Army’s forecasting  models are largely based on the current occupational series and grade  structure and do not lend themselves to forecasting the supply of  multiskilled civilians with the competencies needed in the future. The  contractor recommended that the Army develop a competency-based  inventory of the current workforce using, among other types of  information, core and occupation-specific competencies. According to an  Army official, in July 2003, the Army formed a Competency Area Review  Work Group that consists of the Chief of Workforce Analyses and  Forecasting in Civilian Personnel Policy, some operations research  analysts, and personnel specialists to identify the civilian personnel  competencies and competency measures. According to an Army official,  the group is constructing a competency database that will eventually  contain competencies on all employees. By the end of July 2004, the Army  will have occupational forecasts linked to competencies for a subset of the  Army’s workforce. In fiscal year 2005, the remaining workforce will be  linked by occupation to competencies.
Like the other agencies, the Navy currently does not have the means to  collect, store, and manage data on workforce competencies. In August  2000, a National Academy of Public Administration study for the Navy  pointed out that strategic workforce planning should include automated  tools to identify the tasks and competency requirements of its civilian  workforce. In February 2004, the Navy implemented an online survey  instrument to collect competency data for its civilian workforce. It has  also partnered with a private-sector contractor to manage the competency  collection process. The safety community of the Navy was the first to  initiate the pilot. The process is the same that is being used to collect  competencies for Navy sailors and officers.
The Marine Corps has collected data on workforce competencies. It has a  system under development (the Civilian Workforce Development  Application) that will be used to store and manage data on these  competencies. The target date for completing construction of the  application is July 2005.
The Air Force has identified leadership competencies for the total force  (i.e., active duty military, Air National Guard, Air Force Reserves, and  civilians). It has begun to develop an analytical information system—the  Total Human Resource Managers’ Information System—to capture  occupational codes for the total force. But according to Air Force officials,  the system will not collect, store, and manage data on workforce  competencies.
DLA also currently lacks competency data but has included an objective in  its 2002-2007 Strategic Plan to identify gaps between the workforce  competencies and the skills to meet mission requirements for all DLA  positions by the end of fiscal year 2007. According to a DLA official, the  agency is in the process of constructing a skills management tool. With the  help of a contractor, DLA plans to roll out an automated skills inventory  tool (Competency Analysis Management Tool) expected in July 2004 to  capture the competencies of its current workforce. The analysis tool will  be a Web-based system that employees can access and provide input  regarding their proficiency levels in competencies that have been  identified for the respective job families, according to a DLA official.
section_title: Conclusions
paragraphs: DOD’s current efforts to establish a new personnel system and convert  thousands of military positions to civilian positions, and permanent  authority to offer annual cash buyouts to thousands of employees—when  taken together—provide for wide-ranging changes in DOD’s civilian  personnel reforms. However, it is questionable whether DOD’s  implementation of these reforms will result in the maximum effectiveness  and value because DOD has not developed comprehensive strategic  workforce plans that identify future civilian workforce needs.
Although DOD and the components have taken steps to develop and  implement civilian strategic workforce plans to address future civilian  workforce needs, they generally lack some key elements essential to  successful workforce planning. Because DOD and the components have  not addressed all of the elements of strategic workforce planning, they do  not know what gaps exist in skills and competencies; what type of  recruitment, retention, and training and professional development  workforce strategies should be developed and implemented to meet future  organizational goals; and what competencies their staff need to do their  work now and in the future. More complete information on the  competencies needed for the future workforce would, for example,  enhance DOD’s decisions on which employees to offer cash buyouts. In  addition, DOD and the components lack defined practical, meaningful  measures to gauge outcomes of their workforce strategies. Without  including these key elements, their civilian strategic workforce plans lack  comprehensiveness and consequently, DOD’s future strategic workforce  plans may not result in workforces that possess the critical skills and  competencies needed.
section_title: Recommendations for Executive Action
paragraphs: To improve the comprehensiveness of strategic workforce planning for the  DOD civilian workforce, we recommend that the Secretary of Defense  direct the Office of the Secretary of Defense, the military service  headquarters, and the Defense Logistics Agency to build upon their  strategic workforce planning efforts through the following three actions:    Analyze and document the gaps between current critical skills and  competencies and those needed for the future workforce.
Develop workforce strategies to fill the identified skills and competency  gaps.
Establish results-oriented performance measures to use in evaluating  workforce planning efforts.
section_title: Agency Comments and Our Evaluation
paragraphs: We requested comments on a draft of this report from the Department of  Defense. The Office of the Under Secretary of Defense for Personnel and  Readiness provided oral comments on a draft of this report. The  department partially concurred with our recommendation that it analyze  and document critical skills and competency gaps between its current and  future workforces. Also, the department partially concurred with our  recommendation that it develop workforce strategies to address identified  workforce gaps in skills and competencies. The department concurred  with our recommendation that it establish results-oriented performance  measures to use in evaluating its workforce planning efforts. DOD also  provided technical and general comments that we have incorporated  where appropriate.
DOD partially concurred with our recommendation that the department  analyze and document critical skills and competency gaps between its  current and future workforces. The department stated that in the first  quarter of fiscal year 2004, it began analyses between gaps in the critical  skills currently needed and those needed in the future, and that it  supplements the analyses, as necessary, to meet emerging technologies  and missions. We cannot verify DOD’s statement because DOD was unable  to provide any specific documentation showing that it had performed gap  analyses. Regarding gap analyses of competencies, DOD stated that the  value of conducting a global gap analysis between current competencies  and those needed for the future is unclear, particularly as applied to over  650,000 jobs in nearly 700 occupations. Our recommendation did not  suggest that DOD conduct a global gap analysis of competencies for its  entire civilian workforce. Rather, we recommended that DOD analyze and  document the gaps between current critical skills and competencies and  those needed for the future workforce.
DOD partially concurred with our recommendation that the department  develop workforce strategies to fill identified workforce gaps in skills and  competencies. The department stated that it is actively engaged in  developing strategies to fill identified skills gaps and noted that its new  human capital management system, the National Security Personnel  System, will provide for increased personnel flexibilities designed to  address workforce challenges and help support the department’s strategic  workforce planning efforts. The department also noted that it continues to  use existing flexibilities such as recruitment and retention bonuses, and  relocation allowances. In our report, we acknowledge that the NSPS will  give the department significant flexibility for creating a new framework of  rules, regulations, and processes to govern the way civilians are among  other things, hired, compensated, and promoted. We also acknowledge  that DOD and the components have implemented various recruitment,  retention, training and professional development, and compensation  strategies to address workforce imbalances. However, as we noted in our  report, these strategies have not been derived from analyses of critical  skills and competency gaps. Without such analyses, DOD and the  components may not be able to design and invest in strategies will  effectively and efficiently transition them to the future workforce they  desire and need.
Regarding our recommendation that the department establish results- oriented performance measures to use in evaluating its workforce  planning efforts, the department concurred, noting that it is committed to  focusing on results and using data in evaluating workforce planning  efforts.
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 Director  of DLA. We will also 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 any questions regarding this report, please  contact me at (202) 512-5559 (stewartd@gao.gov) or Sandra F. Bell at (202)  512-8981 (bells@gao.gov). Major contributors to this report were Janine  Cantin, Jeanett H. Reid, Jose Watkins, Alissa Czyz, and Cheryl Weissman.
section_title: Appendix I: Scope and Methodology
paragraphs: To determine the extent to which civilian strategic workforce plans have  been developed and implemented to address future civilian workforce  requirements, we obtained and reviewed Office of Management and  Budget (OMB) guidance on standards for success for strategic human  capital management, and the Office of Personnel Management (OPM)  Human Capital Assessment and Accountability Framework. We also  obtained and reviewed civilian human capital strategic plans, workforce  planning documents, and workforce analysis submitted by the Department  of Defense (DOD) to OMB. We assessed the reliability of data used for the  workforce analysis by (1) reviewing existing information about the system  and the data produced by the system; (2) interviewing agency officials  knowledgeable about the data and reviewing their responses to questions  on system controls; and (3) making basic comparisons of the data with  OPM’s Civilian Personnel Data File’s data for obvious errors in accuracy.  We determined that the data were sufficiently reliable to meet our  objectives. Using the workforce planning documents, we evaluated DOD’s  and the components’ strategic workforce planning efforts in terms of five  strategic workforce planning elements that we identified through our prior  work in review of studies by leading workforce planning organizations  that included the OPM, other U.S. government agencies, the National  Academy for Public Administration, and the International Personnel  Management Association. We also held discussions with the following  cognizant officials to obtain their views on their strategic workforce  planning efforts: the Office of the Under Secretary of Defense for  Personnel and Readiness; the Army, Navy, Marine Corps, and Air Force  headquarters; and the Defense Logistics Agency. Additionally, we obtained  and reviewed civilian employee data and personnel retirement eligibility  data from the Defense Civilian Personnel Data System.
To determine the challenges affecting the development and  implementation of civilian strategic workforce plans, we interviewed  officials and obtained, reviewed, and analyzed documentation to identify  the types of challenges that might affect planning. We also assessed the  extent to which the DOD components had efforts under way to develop  and implement tools to collect, store, and manage data on workforce  competencies.
We conducted our work from April 2003 through June 2004 in accordance  with generally accepted government auditing standards.
section_title: Related GAO Products
paragraphs: Information Technology Management: Improvements Needed in  Strategic Planning, Performance Measurement, and Investment  Management Governmentwide. GAO-04-478T. Washington, D.C.: March 3,  2004.
Human Capital: A Guide for Assessing Strategic Training and  Development Efforts in the Federal Government. GAO-04-546G.  Washington, D.C.: March 1, 2004.
Social Security Administration: Strategic Workforce Planning Needed to  Address Human Capital Challenges Facing the Disability Determination  Services. GAO-04-121. Washington, D.C.: January 27, 2004.
Information Technology Management: Governmentwide Strategic  Planning, Performance Measurement, and Investment Management Can  Be Further Improved. GAO-04-49. Washington, D.C.: January 12, 2004.
Human Capital: Key Principles for Effective Strategic Workforce  Planning. GAO-04-39. Washington, D.C.: December 11, 2003.
Foreign Assistance: USAID Needs to Improve Its Workforce Planning  and Operating Expense Accounting. GAO-03-1171T. Washington, D.C.:  September 23, 2003.
Human Capital: Insights for U.S. Agencies from Other Countries’  Succession Planning and Management Initiatives. GAO-03-914.  Washington, D.C.: September 15, 2003.
DOD Personnel: Documentation of the Army’s Civilian Workforce- Planning Model Needed to Enhance Credibility. GAO-03-1046.  Washington, D.C.: August 22, 2003.
Foreign Assistance: Strategic Workforce Planning Can Help USAID  Address Current and Future Challenges. GAO-03-946. Washington, D.C.:  August 22, 2003.
Results-Oriented Cultures: Implementation Steps to Assist Mergers and  Organizational Transformations. GAO-03-669. Washington, D.C.: July 2,  2003.
Human Capital: A Guide for Assessing Strategic Training and  Development Efforts in the Federal Government. GAO-03-893G.  Washington, D.C.: July 1, 2003.
Tax Administration: Workforce Planning Needs Further Development for  IRS’s Taxpayer Education and Communication Unit. GAO-03-711.  Washington, D.C.: May 30, 2003.
Federal Procurement: Spending and Workforce Trends. GAO-03-443.  Washington, D.C.: April 30, 2003.
Veterans Benefits Administration: Better Collection and Analysis of  Attrition Data Needed to Enhance Workforce Planning. GAO-03-491.  Washington, D.C.: April 28, 2003.
Human Capital: Selected Agency Actions to Integrate Human Capital  Approaches to Attain Mission Results. GAO-03-446. Washington, D.C.:  April 11, 2003.
Results-Oriented Cultures: Creating a Clear Linkage between Individual  Performance and Organizational Success. GAO-03-488. Washington, D.C.:  March 14, 2003.
Human Capital Management: FAA’s Reform Effort Requires a More  Strategic Approach. GAO-03-156. Washington, D.C.: February 3, 2003.
High-Risk Series: Strategic Human Capital Management. GAO-03-120.  Washington, D.C.: January 2003.
Major Management Challenges and Program Risks: Office of Personnel  Management. GAO-03-115. Washington, D.C.: January 2003.
Acquisition Workforce: Status of Agency Efforts to Address Future  Needs. GAO-03-55. Washington, D.C.: December 18, 2002.
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.
Human Capital Legislative Proposals to NASA’s Fiscal Year 2003  Authorization Bill. GAO-03-264R. Washington, D.C.: November 15, 2002.
Highlights of a GAO Forum: Mergers and Transformation: Lessons  Learned for a Department of Homeland Security and Other Federal  Agencies. GAO-03-293SP. Washington, D.C.: November 14, 2002.
Highlights of a GAO Roundtable: The Chief Operating Officer Concept: A  Potential Strategy to Address Federal Governance Challenges.   GAO-03-192SP. Washington, D.C.: October 4, 2002.
Results-Oriented Cultures: Using Balanced Expectations to Manage  Senior Executive Performance. GAO-02-966. Washington, D.C.:   September 27, 2002.
Human Capital Flexibilities. GAO-02-1050R. Washington, D.C.: August 9,  2002.
Results-Oriented Cultures: Insights for U.S. Agencies from Other  Countries’ Performance Management Initiatives. GAO-02-862.  Washington, D.C.: August 2, 2002.
HUD Human Capital Management: Comprehensive Strategic Workforce  Planning Needed. GAO-02-839. Washington, D.C.: July 24, 2002.
NASA Management Challenges: Human Capital and Other Critical Areas  Need to Be Addressed. GAO-02-945T. Washington, D.C.: July 18, 2002.
Managing for Results: Using Strategic Human Capital Management to  Drive Transformational Change. GAO-02-940T. Washington, D.C.: July 15,  2002.
Post-Hearing Questions Related to Federal Human Capital Issues.   GAO-02-719R. Washington, D.C.: May 10, 2002.
Human Capital: Major Human Capital Challenges at SEC and Key  Trade Agencies. GAO-02-662T. Washington, D.C.: April 23, 2002.
Managing for Results: Building on the Momentum for Strategic Human  Capital Reform. GAO-02-528T. Washington, D.C.: March 18, 2002.
A Model of Strategic Human Capital Management. GAO-02-373SP.  Washington, D.C.: March 15, 2002.
Foreign Languages: Human Capital Approach Needed to Correct  Staffing and Proficiency Shortfalls. GAO-02-375. Washington, D.C.:  January 31, 2002.
Human Capital: Attracting and Retaining a High-Quality Information  Technology Workforce. GAO-02-113T. Washington, D.C.: October 4, 2001.
Securities and Exchange Commission: Human Capital Challenges  Require Management Attention. GAO-01-947. Washington, D.C.:  September 17, 2001.
Human Capital: Practices That Empowered and Involved Employees.  GAO-01-1070. Washington, D.C.: September 14, 2001.
Human Capital: Building the Information Technology Workforce to  Achieve Results. GAO-01-1007T. Washington, D.C.: July 31, 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.
Single-Family Housing: Better Strategic Human Capital Management  Needed at HUD’s Homeownership Centers. GAO-01-590. Washington,  D.C.: July 26, 2001.
Human Capital: Taking Steps to Meet Current and Emerging Human  Capital Challenges. GAO-01-965T. Washington, D.C.: July 17, 2001.
Office of Personnel Management: Status of Achieving Key Outcomes and  Addressing Major Management Challenges. GAO-01-884. Washington,  D.C.: July 9, 2001.
Managing for Results: Human Capital Management Discussions in  Fiscal Year 2001 Performance Plans. GAO-01-236. Washington, D.C.: April  24, 2001.
Human Capital: Major Human Capital Challenges at the Departments of  Defense and State. GAO-01-565T. Washington, D.C.: March 29, 2001.
Human Capital: Meeting the Governmentwide High-Risk Challenge.   GAO-01-357T. Washington, D.C.: February 1, 2001.  .
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