Human Capital: DOD Should Fully Develop Its Civilian Strategic Workforce Plan to Aid Decision Makers
Released: 2014-07-09T00:00:00

Letter

Background

Statutory Requirements for DOD’s Strategic Workforce Plan

Section 115b requires that the Secretary of Defense submit to the congressional defense committees, in every even-numbered year, a strategic workforce plan to shape and improve the civilian employee workforce of DOD. The statute assigns overall responsibility for developing and implementing the plan to the Under Secretary of Defense for Personnel and Readiness. In turn, the Under Secretary has assigned responsibility for developing the plan to the Defense Civilian Personnel Advisory Service. The plan is required to include, among other things, assessments of DOD’s existing and projected civilian workforce, and a plan of action to address gaps in critical skills and competencies identified in those assessments.

Section 115b further requires DOD to include in its strategic workforce plan specific information on its Civilian Senior Leader—senior management, functional, and technical—workforces. DOD’s senior management, functional, and technical workforces consist of five career Civilian Senior Leader workforces, which DOD relies on to operate and oversee nearly every activity in the department. These workforces include the following:

Senior Executive Service workforce. Most of the department relies on these officials to fill positions with managerial, supervisory, or policy advisory responsibilities.

Senior Level workforce. These officials fill positions that typically require less than 25 percent of their time to be spent on supervisory or related managerial responsibilities. Most Senior Level employees are in nonexecutive positions whose duties are broad and complex enough to be classified above the GS-15 level.

Senior Technical workforce. These officials perform high-level research and development in the physical, biological, medical, and engineering science fields.

Defense Intelligence Senior Executive Service workforce. These officials fill positions with managerial, supervisory, or policy advisory responsibilities in the Intelligence functional community that falls within DOD.

Defense Intelligence Senior Level workforce. These officials fill senior positions within DOD’s Intelligence community that require less than 25 percent of their time to be spent on managerial or supervisory responsibilities.

Section 1053 of the National Defense Authorization Act for Fiscal Year 2012 added a requirement for DOD to include specific information on its Financial Management workforce in the department’s strategic workforce plan. That section requires that DOD include specific steps that the department has taken or plans to take to develop appropriate career paths for civilian employees in the financial-management field, and include a plan for funding improvements in the Financial Management workforce of the department through the period of the current Future Years Defense Program, including a description of any continuing shortfalls in funding available for that workforce. DOD’s 2013-2018 Strategic Workforce Plan is the department’s first plan that is to include information addressing this requirement. DOD’s financial-management workforce was added to our High-Risk List in 1995.

Key Principles of Effective Strategic Workforce Planning

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 staff to achieve programmatic goals. While agencies’ approaches to workforce planning vary, key principles of strategic workforce planning that should be addressed include the following: align workforce planning with strategic planning and budget formulation; involve top management, employees, and other stakeholders in developing, communicating, and implementing the strategic workforce plan; determine the critical skills and competencies that will be needed to achieve current and future programmatic results; develop strategies that are tailored to address gaps in number, deployment, and alignment of human-capital approaches for enabling and sustaining the contributions of all critical skills and competencies; build the capability needed to address administrative, educational, and other requirements important to support workforce planning strategies; and monitor and evaluate the agency’s progress toward its human-capital goals and the contribution that human-capital results have made toward achieving programmatic results.

With the exception of the first two principles, these principles are similar to elements of DOD’s statutory reporting requirements.

DOD’s Approach to Strategic Workforce Planning

To conduct strategic human-capital planning efforts for the department’s civilian workforce, DOD’s Strategic Human Capital Planning Office used functional community categories to group together employees who perform similar functions. In some cases, these communities include mission-critical occupations. For its 2013-2018 Strategic Workforce Plan, DOD identified 22 functional communities and provided information on 30 of its 32 mission-critical occupations. DOD’s approach to developing its strategic workforce plan includes meetings between functional community leadership and officials from the Defense Civilian Personnel Advisory Service, an environmental scan as part of a continuous information- gathering process, and quarterly recruitment and retention data updates provided to the functional communities.

According to DOD’s Strategic Workforce Plan, mission-critical occupations are occupations or occupational groups that set direction, directly impact, or execute performance of mission-critical functions or services. Further, mission-critical occupations are positions key to DOD’s current and future mission requirements, as well as those that present recruiting and retention challenges. Appendix II shows DOD’s functional communities and their associated mission-critical occupations.

Prior GAO Work Evaluating DOD’s Strategic Workforce Plans

We have conducted assessments of DOD’s strategic workforce plans since 2008, and our body of work has found that DOD’s efforts to address strategic workforce planning requirements have been mixed.February 2009 report, we recommended that the offices responsible for addressing DOD’s strategic workforce-planning requirements develop performance plans that include establishing implementation goals and time frames, measuring performance, and aligning activities with resources. DOD has since completed implementation of the actions it had underway at that time to develop performance plans. In our most recent In our report in September 2012 on the department’s overall civilian strategic workforce plan, we recommended that DOD include in the guidance that it disseminates for developing future strategic workforce plans clearly defined terms and processes for conducting these assessments; conduct competency-gap analyses for DOD’s mission-critical occupations and report the results; establish and adhere to timelines that will ensure issuance of future strategic workforce plans in accordance with statutory time frames; provide guidance for developing future strategic workforce plans that clearly directs the functional communities to collect information that identifies not only the number or percentage of personnel in its military, civilian, and contractor workforces but also the capabilities of the appropriate mix of those three workforces; and enhance the department’s results-oriented performance measures by revising existing measures or developing additional measures that will more clearly align with DOD’s efforts to monitor progress in meeting the strategic workforce-planning requirements in section 115b of Title 10 of the United States Code.

DOD either concurred or partially concurred with the recommendations in our September 2012 report, stating that, among other things, the department was deliberate in applying lessons learned from previous workforce plans and identifying specific challenges and the actions being taken to address those challenges to meet statutory planning requirements by 2015.

In our September 2012 report on the department’s Civilian Senior Leader strategic workforce plan, we recommended that DOD conduct assessments of the skills, competencies, and gaps within all five career Civilian Senior Leader workforces and report them in DOD’s future strategic workforce plans.and stated that the department fell short of conducting assessments of skills, competencies, and gaps within three of the five Civilian Senior Leader workforces as a result of their technical roles in the DOD leadership hierarchy, and that, as roles are refined, this work will be DOD concurred with our recommendation reflected in future plans as appropriate. The status of these and other prior recommendations may be found in appendix III.

DOD’s Plan Partially Addresses Most Statutory Requirements and Does Not Provide Comprehensive Workforce Information for Decision Makers

Our assessment of DOD’s Fiscal Years 2013-2018 Strategic Workforce Plan found that DOD’s plan addresses 8 and partially addresses 19 of the 32 statutory requirements. The plan does not address 5 of the 32 statutory requirements. As a result, DOD’s plan does not provide decision makers with comprehensive information on DOD’s workforce. The 2013- 2018 plan represents an improvement since 2008 when we found that DOD’s 2006-2010 Civilian Human Capital Strategic Workforce Plan did However, since not meet six of eight statutory reporting requirements.2008, Congress has expanded the number and scope of statutory requirements for DOD to include, among other things, details about its civilian senior-leader and financial-management workforces. Table 1 provides the results of our analysis of the extent to which DOD’s plan for the overall, civilian senior-leader, and financial-management workforces addressed the Section 115b statutory requirements.

Section 115b of Title 10 of the United States Code requires DOD to develop a strategic workforce plan to shape and improve the civilian employee workforce of the department, to include specific elements such as an assessment of the current critical skills and competencies of the civilian workforce; any gaps in the existing or projected workforce; and the appropriate mix of civilian, military, and contractor capabilities. DOD also was required to identify the specific funding needed to achieve recruiting and retention goals, and the funding needed to implement strategies for developing, training, deploying, compensating, and motivating the civilian employee workforce of the department. In addition to addressing the overall civilian workforce, the legislation also requires the department to include separate chapters to address the shaping and improvement of specific workforces, including: (1) the Civilian Senior Leader workforce and (2) the Financial Management workforce. We summarize the results of our assessment of DOD’s overall civilian, Civilian Senior Leader, and Financial Management workforce plans below. In addition, we provide detailed information in appendix IV on the extent to which the 2013-2018 Strategic Workforce Plan addressed the statutory requirements.

Overall Civilian Workforce

With regard to the overall civilian workforce, we found that DOD’s Fiscal Year 2013-2018 Strategic Workforce Plan addresses three of the statutory requirements, partially addresses six requirements, and does not address one requirement. For example, DOD’s plan addressed the requirement to provide an assessment, using results-oriented performance measures, of the progress the department has made in implementing the plan in the prior year. Specifically, DOD’s plan identified six performance measures the department is using to assess progress. These measures include, among others, (1) the percentage of workforce planning key milestones completed by each functional community, then aggregated across all communities; (2) the percentage difference between actual workforce levels and target workforce levels for the mission-critical occupations; and (3) the number of mission-critical occupations for which competency models will be developed and deployed by September 2014.

By contrast, DOD’s overall civilian plan partially addresses, among others, the requirements to assess the department’s critical skills and competencies of both the existing and future workforces. We found that DOD assessed its critical skills by identifying and providing information on the mission-critical occupations. However, DOD’s plan did not include competency assessment information for most of the workforces. In subsequent discussions, DOD officials told us that, as of April 2014, the department had completed competency models for the current mission- critical occupations, but had not yet completed the assessments of the competencies associated with those occupations and, therefore, could not include the required assessments in the plan. Those officials also told us that they intend to include the results of these assessments in future strategic workforce plans.

Finally, DOD’s overall civilian workforce plan does not address the requirement to include an assessment of the appropriate mix of military, civilian, and contractor personnel capabilities. According to the plan, in fiscal year 2012 the department initiated a pilot study of the process to assess capabilities being delivered by the federal government career civilian workforce, military personnel, and contract support for three mission-critical occupations. Although the plan discussed the existence of this pilot program, it did not provide the actual assessment of those occupational series’ mix of capabilities, as directed by the requirement. At the time of our review, Defense Civilian Personnel Advisory Service officials told us that the plan did not include specific information on the results of the pilot because the program was being reevaluated during the fiscal year 2014-2019 Strategic Workforce Plan cycle and will be updated for future reporting. According to the plan, the department’s goal is to assess a broad range of mission-critical occupation capabilities by fiscal year 2016, but the department did not provide further details on these plans, such as interim milestones or the number of mission critical occupations it intends to assess.

Civilian Senior Leader Workforce

With regard to the Civilian Senior Leader workforce, we found that DOD’s 2013-2018 Strategic Workforce Plan addresses four of the statutory requirements, partially addresses seven requirements, and does not address one requirement. For example, DOD’s plan addresses the requirement to include specific strategies for developing, training, deploying, compensating, motivating, and designing career paths and career opportunities. Specifically, DOD’s plan identified the department’s effort to revise the scope of its Defense Executive Advisory Board to help the department maintain the caliber of its Senior Executive Service leadership. In addition, the plan discussed efforts by the department to promote diversity and interest among civilian employees to join the executive ranks.

However, we found that the Civilian Senior Leader plan partially addresses, among others, the requirements to assess the critical skills and competencies of the current and future workforces because the plan only provided competency information for the Senior Executive Service. More specifically, the plan provided information on the 16 Office of Personnel Management government-wide competencies and 2 DOD- specific competencies for the Senior Executive Service, which includes strategic thinking, leveraging diversity, and developing others, among others. The department’s plan did not, however, provide an assessment of the critical skills needed by the Civilian Senior Leader workforce, which is also a part of the statutory requirement. In addition, DOD’s Civilian Senior Leader workforce plan partially addresses the requirement to assess critical skill and competency gaps because, while it did include information on the process used for assessing gaps in its Senior Executive Service workforce, it did not include similar gap information for the other Civilian Senior Leader workforces.

Finally, the Civilian Senior Leader plan also does not address the requirement to include an assessment of the appropriate mix of military, civilian, and contractor personnel capabilities. Although the plan provided a breakdown of the projected requirements for each of the department’s Civilian Senior Leader workforce categories through fiscal year 2018, and also stated that the department may use military personnel, among others, to fill gaps in its Civilian Senior Leader workforce, it did not discuss any requirements for the department’s senior military personnel. The plan further stated that there is little to no need for a contractor workforce at the Civilian Senior Leader workforce level.

Financial Management Workforce

With regard to the Financial Management workforce, we found that DOD’s 2013-2018 Strategic Workforce Plan addresses one, partially addresses six, and does not address three of the statutory requirements. For example, DOD’s plan addresses the requirement to include specific steps that the department has taken or plans to take to develop appropriate career paths for its workforce, among other things. The plan outlined six major milestones for developing the enterprise-wide financial management career paths, beginning, for example, with collecting the component-specific career paths.

Consistent with the other two plans, however, we found that DOD’s Financial Management workforce plan partially addresses the requirements to assess the critical skills and competencies of the current and future workforces. Although the plan identified 4 of the community’s 13 occupational series as mission-critical occupations, which DOD considers its critical skills, and identified the projected trends associated with those occupational series due to retirement, the plan did not provide an assessment of the overall Financial Management workforce’s 23 competencies. According to officials, this information was not included in the plan because the community did not begin to conduct its competency assessments until April 2014 and the results of the assessments are not expected to be available until July 2014.

Additionally, the plan partially addresses the requirement to include specific strategies for developing, training, deploying, compensating, and motivating the workforce to address gaps in critical skills and competencies, as well as the program objectives and funding for those strategies. We found that, although the plan included a specific strategy for, among other things, developing and training the Financial Management workforce, the plan did not identify the funding needed for this strategy. The plan stated only that the community coordinated funding needs with DOD’s components and that these funding needs were included in the fiscal year 2014 President’s Budget. Although not included in the plan, officials from the Comptroller’s office told us that they realigned approximately $13 million to $14 million per year across the fiscal year 2014-2018 Future Years Defense Program to address training shortfalls and to provide funding for additional web-based course development. Officials from the Defense Civilian Personnel Advisory Service told us that they did not include specific cost information for a majority of the goals and strategies because strategy information comes from the functional communities and, in some cases, each service implements the identified goals and strategies, as needed, and builds any resultant costs into their individual budgets. However, the information we obtained separately from the Financial Management functional community, if included in the plan, would have contributed toward DOD’s ability to meet this statutory requirement.

The Financial Management workforce plan also does not address the requirement to include an assessment of civilian, military, and contractor capabilities. As noted above, the department took preliminary steps to assess its workforce mix capabilities through a pilot program; however, the financial management mission-critical occupations were not included as part of that pilot program, and details of the program were not included as part of DOD’s plan. According to the plan, the community focused primarily on the civilian Financial Management workforce and, therefore, only provided demographic information on civilians in the mission-critical occupations. The plan did not, however, provide similar demographic and projected target data for the military portion of the Financial Management workforce, nor did it address the statutory requirement to provide an assessment of the appropriate mix of military, civilian, and contractor personnel capabilities.

According to officials from the Defense Civilian Personnel Advisory Service responsible for the overall Fiscal Year 2013-2018 Strategic Workforce Plan, the department did not address all requirements because the plan comprises individual submissions from each of the 22 functional communities and the communities are at different stages in the planning process. In addition, officials also told us that the department tried to provide a consistent level of information for each workforce and, in some cases, omitted available information—such as information on specific workforces—that would address some of the statutory requirements. DOD officials also stated that some requirements were not addressed in the Fiscal Year 2013-2018 Strategic Workforce Plan because additional efforts are ongoing to address those requirements and the requirements will be reported on in future iterations of the plan.

The department provided its own self-assessment as part of the plan in which it rated its progress addressing the statutory requirements, and found that further work was needed to assess its critical competencies and appropriate mix of military, civilian, and contractor workforce capabilities. Without ensuring that all statutorily required information is included in the strategic workforce plan, DOD risks producing a plan that does not effectively address the department’s needs and will not aid the decision-making process for total workforce management. Although DOD has not met all statutory requirements in its strategic workforce plan, we are not making recommendations at this time because we previously recommended that DOD include these requirements in the plan, as discussed in additional detail in appendix III. We will continue to monitor DOD’s progress in implementing these recommendations.

DOD’s Strategic Workforce Plan Is Not Consistent with Some Key Strategic Workforce-Planning Principles

DOD has not fully incorporated key strategic workforce-planning principles into the development of its strategic workforce plan. Specifically, although DOD has begun to take steps that are consistent with these key principles, we found that the department’s plan was not fully aligned with the budget process or the department’s other strategic workforce-management initiatives—such as those to address recruiting, retention, and readiness issues—and did not involve stakeholders within its Intelligence functional community. Further, DOD has begun to conduct competency-gap assessments, which may help them in implementing the key principles. However, DOD’s plan did not include a complete assessment of the competencies that will be needed to achieve current and future programmatic results nor strategies tailored to address gaps in the critical competencies needed to achieve those results.

DOD’s Strategic Workforce Plan Is Not Fully Aligned with the Budget Process or Other Strategic Workforce- Management Initiatives

DOD’s strategic workforce plan is not fully aligned with the budget process or the department’s other strategic workforce-management initiatives. While this practice is not part of DOD’s statutory reporting requirements, key practices in human-capital management identify strategic alignment—which occurs when an agency’s workforce strategies are linked with its mission and goals, and integrated into its strategic plan, performance plan, and budget formulation—as one of six leading principles for effective strategic workforce planning. In addition, according to one model of strategic human-capital management for federal agencies to use when designing their human-capital management plans, the highest level of strategic integration and alignment occurs when an agency considers human-capital initiatives or refinements in light of both changing organizational needs and the demonstrated successes or shortcomings of its human capital efforts.model, the human-capital needs of the organization and new initiatives or refinements to existing human-capital approaches should be reflected in strategic workforce-planning documents.

Further, according to that DOD’s Fiscal Year 2013-2018 Strategic Workforce Plan is missing key funding information that would facilitate DOD’s budget decisions because it is not aligned to the budget process. DOD’s plan identified 31 strategies for addressing workforce gaps, but did not provide specific information on the funding required—an important element in budget planning decisions—to implement most of these strategies. Only 1 of the 31 strategies—developed by the Intelligence functional community and identified in the plan—provided detailed information on the amount of funding required to implement the strategy. However, for some strategies, DOD’s plan stated that funding was, among other things, at the discretion of the DOD components or to be included in component budgets. For other strategies, DOD’s plan stated that additional funding may be necessary. In each case where funding information was not provided, the plan provided no additional detail on the amount of funding needed to implement the strategies.

Furthermore, the importance of DOD aligning its workforce plan with other strategic workforce initiatives is demonstrated in a December 2013 letter That letter that DOD provided to the congressional defense committees.outlined steps the department is taking to minimize any negative effect on the morale of its civilian workforce and long-term consequences on recruiting and retention due to DOD’s implementation of civilian furloughs conducted during the summer of 2013. DOD’s letter stated the morale of the civilian workforce had been declining for a number of reasons, including the furloughs, and stated that the department expected future furloughs and budget uncertainties to further this downward trend. The department also stated it anticipates that these issues will factor heavily into employees’ decisions about when to depart, as well as individuals’ decisions about when to apply for positions within the department, which will have an effect on recruiting, retention, and readiness.

We recognize that DOD’s letter to the congressional defense committees on this matter was sent after its strategic workforce plan was provided to Congress. We note, however, that the steps outlined in DOD’s letter are targeted at minimizing the declining morale of the department’s civilian workforce. The strategic workforce plan includes recruitment, retention, and development strategies aimed specifically at addressing gaps in critical skills within the department’s functional communities. However, without aligning the steps DOD describes in its letter to congressional defense committees with its strategic workforce plan, DOD may lack assurance that these efforts will support its overall strategic workforce- planning goals including, for example, how it will address gaps.

To address these issues, DOD stated that the department continues to focus on its strategic workforce-planning efforts that include strategies identified and carried out by the functional communities aimed to recruit, retain, motivate, and develop the present and future civilian workforce. However, DOD officials stated during this review that the recruiting, retention, and workforce development strategies outlined in the department’s strategic workforce plan are developed by the individual functional communities and are implemented and funded as appropriate primarily at the component level. Therefore, these strategies do not constitute a department-wide approach to addressing morale, recruitment, and retention issues related to past or future furloughs or budget uncertainties. Further, as our analysis of DOD’s current strategic workforce plan shows, DOD has not completed its competency or competency-gap assessments to know where it should target its efforts, nor did its plan include the funding required to carry out such strategies.

DOD’s strategic workforce plan currently is not fully aligned with the budget process or other workforce initiatives because there is no requirement for DOD’s plan to be aligned with these other efforts. Additionally, there is not a common understanding of how the department’s strategic workforce plan will be or should be used within the Office of the Under Secretary of Defense for Personnel and Readiness. Officials from the Defense Civilian Personnel Advisory Service, who have overall responsibility for DOD’s strategic workforce plan, told us they do not envision the plan being linked to other strategic workforce efforts, but added that they believe the workforce planning process itself has value for those involved in the development process.

In contrast, officials from the Total Force Requirements and Sourcing Policies Directorate within the Office of the Under Secretary of Defense for Personnel and Readiness told us that the strategic workforce plan in its current form is more useful as a source of demographic information on the department’s civilian workforce than as a strategic document intended to guide workforce decisions. These officials further stated that the plan would be more useful as a strategic document if certain actions were taken, such as aligning the strategic workforce plan with the DOD budget process, among other things. In addition, although the plan states that DOD intends to align it with the DOD budget and total force–management processes, it did not include specific details or time frames for doing so.

According to officials with the Defense Civilian Personnel Advisory Service, they have been unable to make progress on these efforts because of a lack of information and challenges in coordinating with other offices within DOD. These officials further stated that they do not foresee these challenges being resolved before the department issues its next strategic workforce plan. Our analysis of the Fiscal Year 2013-2018 Strategic Workforce Plan in particular indicates that without fully aligning DOD’s strategic workforce plan with the budget process and management workforce initiatives, such as those to address recruiting, retention, and readiness issues associated with declining morale, the department will not be in the best position to make informed management and resource decisions about its workforce.

What we found in our analysis of the Fiscal Year 2013-2018 Strategic Workforce Plan is in line with a body of work we have conducted in recent years examining other DOD strategic workforce efforts, which found that not aligning the plan with other strategic workforce initiatives is a long- standing issue within DOD. These include workforce-sizing decisions and total force–management efforts.

In July 2012, we testified on our observations of DOD’s planning for its civilian workforce requirements and reported on DOD’s efforts since the 1990s to reduce its civilian workforce. Specifically, we found that these efforts did not focus on taking a strategic approach to its workforce downsizing and reshaping efforts, which resulted in imbalances to the shape, skills, and retirement eligibility of its workforce. We found that this was especially true of the civilian acquisition workforce, which from September 1989 to September 1999 was reduced by almost 47 percent. This rate of reduction substantially exceeded that of the rest of the DOD workforce. We concluded that 11 consecutive years of downsizing produced serious imbalances in the skills and experience of the highly talented and specialized civilian acquisition workforce, putting DOD on the verge of a retirement-driven talent drain. Moreover, we found that the lack of an adequate number of trained acquisition and contract-oversight personnel has, at times, contributed to unmet expectations and placed DOD at risk of potentially paying more than necessary.

In January 2013, we reported on DOD’s efforts to implement its self- imposed cap on its civilian workforce levels, and found that the department had not completed its competency-gap assessments— identifying gaps in the existing or projected civilian workforce that should be addressed to ensure the department has continued access to needed critical skills and competencies. As a result, we concluded that information on competency gaps was unavailable to help inform decision making about DOD’s civilian workforce when implementing the cap. We also concluded that a fully developed workforce plan, with all completed gap assessments, would help DOD make informed decisions about reducing its workforce and develop strategies to mitigate skill shortages that affect achieving the mission. As a result, we recommended that DOD involve functional community managers and use information from its critical skill and competency- gap assessments as they are completed to make informed decisions for future changes to the workforce and that it document its strategies. DOD partially concurred with our recommendation and stated that it aligns its workforce, both in size and structure, to mission requirements and justifies the current size and possible reductions or increases to the workforce based on mission workload rather than competency or skill gaps needed to deliver capabilities. However, we concluded in that report that DOD is not in a position to justify the size of its workforce until it has fully addressed its statutory requirement to identify areas of critical-skill and competency gaps within the civilian workforce. At the time of our current review, DOD maintained its civilian workforce cap, and, in addition, section 955 of the National Defense Authorization Act for Fiscal Year 2013 required the Secretary of Defense to ensure that the civilian and service contractor workforces are appropriately sized to support and execute the National Military Strategy, taking into account military personnel and force-structure levels, and to develop an efficiencies plan for those workforces. Section 955 further requires that the efficiencies plan achieve savings in total funding of the civilian and service contractor workforces that are not less than certain savings achieved from reductions in military end strength over a 6-year period, subject to certain exceptions.

In May 2013, we reported on DOD’s total force–management efforts and found that DOD had taken some steps to improve its understanding and management of its total workforce, but it had not assessed the appropriate mix of its military, civilian, and contractor personnel capabilities in its strategic workforce plan as required by law. We concluded that the department was hampered in its ability to make more-informed strategic workforce mix decisions, which are crucial to meeting DOD’s statutory responsibility to manage its total workforce. We recommended that DOD revise its existing workforce policies and procedures according to current statutory requirements in Section 129a of Title 10 of the United States Code as well as regulatory requirements set forth in the Office of Federal Procurement Policy’s September 2011 policy letter to address the (1) determination of the appropriate workforce mix, and (2) identification of critical functions. DOD partially concurred and stated that the department’s strategic workforce plan is an integral tool in informing policies and procedures for retention, recruitment, and accession planning and helps inform the demographic makeup of its civilian personnel inventory. DOD also stated that the department justifies its workforce size based on mission workload, rather than competency or skills gaps. However, we concluded in that report that DOD is required by law to establish policies and procedures that require the use of the strategic workforce plan when making determinations of the appropriate mix of total workforce personnel necessary to perform its mission, and to include in the strategic workforce plan an assessment of the appropriate mix of military, civilian, and contractor personnel capabilities. As of May 2014, DOD has not taken action to implement these recommendations.

DOD’s Approach to Developing Its Plan Did Not Fully Involve Stakeholders within Its Intelligence Functional Community

DOD’s approach to developing its Fiscal Years 2013-2018 Strategic Workforce Plan did not fully involve stakeholders within the Intelligence functional community to help ensure statutorily required information is included. While this kind of stakeholder involvement is not statutorily required, a key principle of effective strategic workforce planning is to involve top management, employees, and other stakeholders in developing, communicating, and implementing strategic workforce plans. In addition, federal internal-control standards state that decision makers need complete and relevant information to manage risk associated with achieving objectives, such as those outlined in strategic plans.

DOD’s Fiscal Year 2013-2018 Strategic Workforce Plan did not fully involve some stakeholders within the Intelligence functional community throughout the development of the plan, which resulted in the omission of key stakeholder input. Specifically, during the strategic workforce planning process, the Intelligence functional community compiled workforce information on its one mission-critical occupation—the 0132 Intelligence series—and the two senior-leader workforces over which the Office of the Under Secretary of Defense for Intelligence has oversight— the Defense Intelligence Senior Executive Service and the Defense Intelligence Senior Level workforces. DOD relies on these two senior- leader workforces to oversee key activities within the defense intelligence community. The Defense Intelligence functional community includes personnel in intelligence occupations from the military departments as well as the National Security Agency, the Defense Intelligence Agency, the National Reconnaissance Office, the National Geospatial-Intelligence Office, and the department’s Defense Intelligence civilian senior-leader workforces—Defense Intelligence Senior Executive Service and Defense Intelligence Senior Level.

DOD is required to include information on the two Intelligence Civilian Senior Leader workforces in its strategic workforce plan. According to Intelligence functional community managers, they provided information on these two workforces to the Defense Civilian Personnel Advisory Service. However, our review found disparities between the level of detail of the information provided and the information that was incorporated in the strategic workforce plan about these two workforces. For example, the strategic workforce plan included one paragraph of descriptive information on both categories of defense intelligence senior-leader workforces in the Senior Executive Service workforce plan. In contrast, the Intelligence functional community provided detailed information on the Defense Intelligence Senior Executive Service and Defense Intelligence Senior Level workforces to the Defense Civilian Personnel Advisory Service for inclusion in the strategic workforce plan. This information included details that would have supported an assessment of the critical skills and competencies, among other things, of the defense intelligence civilian senior-leader workforces, which is required by law to be included in DOD’s strategic workforce plan. However, the Defense Civilian Personnel Advisory Service did not fully incorporate this information on the workforces’ critical skills and competencies into the final version of DOD’s strategic workforce plan.

During the course of our review, we discussed these disparities with officials from both the Intelligence functional community and the Defense Civilian Personnel Advisory Service to try to determine the cause of the missing information. According to officials from the Defense Civilian Personnel Advisory Service, the office revised and omitted select information provided by the Intelligence functional community on defense intelligence civilian senior-leader workforces, but they believed the level of detail provided was sufficient to address the statutory requirements. However, our assessment of the information raises questions as to whether the officials responsible for the Civilian Senior Leader strategic workforce plan checked these omissions against the statutory reporting requirements, and if not, as a result excluded key information from the strategic workforce plan on defense intelligence civilian senior-leader workforces that was statutorily required.

In our discussions, officials within the Intelligence functional community responsible for the initial development of this required information and officials from the Defense Civilian Personnel Advisory Service were unclear as to why, in the final coordination of the plan, all stakeholders from the Intelligence functional community were not involved in helping to ensure the inclusion of key statutorily-required information. In subsequent discussions, officials from the Defense Civilian Personnel Advisory Service stated that they would be vigilant of such omissions during the development of future plans to help ensure all available, statutorily required information is included and that all appropriate stakeholders are involved in the development and review processes.

DOD’s Plan Did Not Include Complete Competency-Gap Assessments or Strategies for Addressing Critical Competency Gaps

DOD’s Fiscal Year 2013-2018 Strategic Workforce Plan did not include completed competency-gap assessments or strategies for addressing critical competency gaps. A leading principle of effective strategic workforce planning is that agencies should determine the critical skills and competencies that will be needed to achieve current and future programmatic results and develop strategies tailored to address gaps and human-capital conditions in critical skills and competencies that need attention. Although we found that DOD has taken steps to determine the critical skills needed by the department through the identification of its mission-critical occupations, our evaluation of DOD’s Fiscal Year 2013- 2018 Strategic Workforce Plan found that the department has not completed its competency and competency-gap assessment or included strategies to address competency gaps based on such assessments.

In 2004, we recommended, and DOD partially concurred, that the department develop workforce strategies to fill the identified skills and competency gaps. Additionally, in 2012, we recommended DOD conduct competency-gap assessments for its mission-critical occupations and report the results. DOD concurred with our recommendation and stated in its agency comments that competency gaps would be assessed in the future. To date, however, the department’s strategic workforce plan has only included strategies that address staffing gaps—which are aimed at addressing gaps in the critical skills, but not the critical competencies, needed in a workforce—within its mission-critical occupations.

Furthermore, our analysis of three functional communities’ strategic workforce plans found that the Intelligence and Financial Management functional communities have not completed their competency-gap assessments or developed strategies for addressing competency gaps in their workforces. In regard to the Civilian Senior Leader functional community, DOD’s strategic workforce plan provided information on competencies for one of the five categories of Civilian Senior Leader workforces—the Senior Executive Service. Our analysis of these three functional communities’ strategic workforce plans suggests that additional attention is needed in DOD’s approach to strategic workforce planning to fully address our prior recommendations with regard to critical skill and competency assessments.

Intelligence Functional Community

The Intelligence functional community has identified broad competencies for its one mission-critical occupation—the 0132 Intelligence series—but further progress in competency development and assessment for its workforce will not be complete until the community develops a common standard for titling occupational specialties (e.g., Human Intelligence and Signals Intelligence) within its 0132 Intelligence series workforce. According to Intelligence functional community officials and the Intelligence community’s own workforce plan, eight broad competencies have been identified for its mission-critical occupation. However, competency assessments and gap assessments cannot be completed until the community completes development of standard civilian intelligence job titles for occupational specialties within the Intelligence series mission-critical occupation. Officials from the Intelligence functional community told us they are coordinating with relevant stakeholders within the defense intelligence community and the Defense Civilian Personnel Advisory Service on an occupational titling standard to address this issue. Those officials also stated that efforts are underway and it may take up to 2 years to complete the development of the occupational titling standard. Once the standard is developed, competency models for each occupational specialty within the intelligence series will be further developed for the workforce, according to officials.

Financial Management Functional Community

The Financial Management functional community is currently in the process of developing a strategy that, in part, addresses its workforce’s skills and competencies and is scheduled to assess the competencies of its mission-critical occupations. The strategy being developed—the Financial Management Certification Program—is a program that is expected to consolidate multiple Financial Management workforce development efforts across the department into a mandatory program to educate, train, and certify both civilian and military financial management personnel. In addition, competency assessments for the Financial Management functional community’s mission-critical occupations were scheduled to begin using an enterprise-wide competency assessment tool from April 7 to April 25, 2014, and extended the assessment period through May 9, 2014. The results of this assessment were not yet available to the functional community, and officials stated that they would receive the results from the Defense Civilian Personnel Advisory Service by July 2014. At the time of our review, officials from the Office of the Secretary of Defense (Comptroller) were waiting for the Defense Civilian Personnel Advisory Service to analyze the competency-assessment data. According to DOD, this effort, which included key financial-management and leadership competencies, will enable the community to assess and close the gaps between current capabilities and the competencies required by DOD’s future Financial Management workforce.

Civilian Senior Leader Functional Community

The strategic workforce plan for DOD’s Civilian Senior Leader functional community—a cross-cutting workforce that includes personnel from the Senior Executive Service and Senior Level workforces, among others— identifies the competencies of its Senior Executive Service workforce but does not include information on the competencies and competency assessments of its other Civilian Senior Leader workforces. The department’s Civilian Senior Leader workforce plan provides information on Office of Personnel Management–and DOD-specific competencies for DOD’s Civilian Senior Leader workforce. However, the plan does not include information on the competencies and competency assessments for its Senior Level and Senior Technical workforce. According to the plan and officials responsible for the development of the Civilian Senior Leader strategic workforce plan, these senior-leader workforces are specialized in nature and they are evaluated primarily on the technical or functional competencies found within their specific occupational series. The plan also does not provide information on the competency and competency assessments for the Defense Intelligence Senior Executive Service and Defense Intelligence Senior Level workforces. Furthermore, the plan does not identify any specific strategies for addressing competency gaps for the Civilian Senior Leader workforces, though it does identify some minimal competency gaps for its senior executive service workforce.

Because we previously recommended that DOD conduct competency- gap analyses as part of our 2004 and 2012 reports, we are not making new recommendations to address this issue in this report. We continue to believe that our prior recommendations have merit and would improve DOD’s strategic workforce plan. We will continue to monitor DOD’s efforts to address our prior recommendations.

Conclusions

In this time of budgetary and fiscal constraint, a strategic workforce plan that includes relevant and complete workforce analyses and associated plan of action is crucial for DOD to effectively and efficiently manage all of its civilian workforces. Since our first report in 2008 on DOD’s strategic workforce plan, we have consistently reported that DOD has made progress in addressing strategic workforce planning requirements. In that time, however, we have also identified consistent issues in DOD’s efforts to develop its plan, such as the department not assessing and reporting on mission-critical competencies and gaps. We recognize the effort that DOD is putting forth to include this information in its recurring strategic workforce plans and address all mandated strategic workforce planning requirements. However, without ensuring that all statutorily required information is included in the strategic workforce plan, DOD risks producing a plan that does not effectively address the department’s needs and will not aid the decision-making process for total workforce management. As a result, we continue to believe that DOD should fully implement our past recommendations on including all required information.

While this is the last of DOD’s strategic workforce plans we are mandated to evaluate, we believe that, moving forward, it is important for DOD to continue its efforts to complete development of its strategic workforce plans to help ensure that the department has the right people, in the right place, at the right time. This type of workforce planning can also help DOD focus limited resources on those human-capital programs that most affect their ability to accomplish the department’s wide array of missions. However, until DOD aligns its strategic workforce plan with the budget process and other strategic management initiatives, such as those to address recruitment, retention, and readiness issues, both DOD and congressional decision makers may not have visibility over the areas most in need of attention. Through greater alignment, DOD can help to better ensure that its strategic workforce plan appropriately addresses the human-capital challenges of the future and better contributes to the agency’s efforts to meet its missions and goals.

Recommendation for Executive Action

To help ensure that decision makers and Congress have the necessary information to provide effective oversight of DOD’s civilian workforce and that the strategic workforce plan can be used effectively, we recommend that the Secretary of Defense direct the Office of the Under Secretary of Defense for Personnel and Readiness align DOD’s strategic workforce plan with the budget and management workforce initiatives, such as those to address recruiting, retention, and readiness issues associated with declining morale among its civilian workforces.

Agency Comments and Our Evaluation

We provided a draft of this report to DOD for comment. In written comments, DOD concurred with our recommendation. DOD’s comments are reprinted in their entirety in appendix V.

DOD concurred with our recommendation to align the department’s strategic workforce plan with the budget and management workforce initiatives, such as those to address recruiting, retention, and readiness issues associated with declining morale among its civilian workforces. We are encouraged that DOD recognizes the importance of linking its strategic workforce plan with the budget and other management workforce initiatives.

We are sending copies of this report to the appropriate congressional committees, the Secretary of Defense, and the Under Secretary of Defense for Personnel and Readiness. In addition, this report is available at no charge on the GAO website at http://www.gao.gov.

If you or your staff have any questions regarding this report, please contact me at (202) 512-3604 or farrellb@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this report. GAO staff who made major contributions to this report are listed in appendix VI.

Appendix I: Scope and Methodology

To determine the extent to which the Department of Defense’s (DOD) Fiscal Year 2013-2018 Strategic Workforce Plan addressed the statutory requirements of Section 115b of Title 10 of the United States Code, we evaluated DOD’s 2013-2018 Strategic Workforce Plan and supporting documentation to determine the degree to which the plan addresses, partially addresses, or does not address each of the required elements. Using a scorecard methodology, we assigned a rating of “addresses” if all elements of a legislative requirement were cited, even if specificity and details could be improved upon. We assigned a rating of “partially addresses” if an assessment or plan of action did not include all of the elements of a legislative requirement. A rating of “does not address” was assigned when elements of a characteristic were not explicitly cited or discussed or any implicit references were either too vague or too general to be useful. To make this determination, two GAO analysts independently evaluated and scored each element in DOD’s plan, and then met to resolve any differences in their respective independent analyses. When different initial ratings were given by the two analysts, they met to discuss and resolve the differences in their respective scorecards. In addition, our Office of General Counsel reviewed the team’s completed analysis.

We then discussed the results of our analysis with officials from the Strategic Human Capital Planning Office and the Defense Civilian Personnel Advisory Service, within the Office of the Under Secretary of Defense for Personnel and Readiness, who are responsible for developing the plan. We also discussed the results of our assessment with officials from the Office of the Undersecretary of Defense for Intelligence and the Office of the Undersecretary (Comptroller) who serve as the functional community managers for the Intelligence functional community and the Financial Management functional community, respectively. Officials from the Defense Civilian Personnel Advisory Service have responsibility for the Civilian Senior Leader workforce plan.

To determine the extent to which DOD’s strategic workforce plan is consistent with key strategic workforce planning principles, we compared DOD’s 2013-2018 Strategic Workforce Plan to key principles of effective strategic workforce planning.principles—aligning workforce planning with strategic planning and budget formulation and involving stakeholders, among others, in developing, communicating, and implementing the strategic workforce plan—that do not overlap with the statutory requirements. Additionally, we selected two other key principles—determining the critical skills and competencies needed to achieve current and future programmatic results and developing strategies that are tailored to address gaps—because they are integral to developing a comprehensive strategic workforce plan and we have consistently found that DOD has not yet completed actions to address issues related to them.

GAO, Human Capital: DOD Needs Complete Assessments to Improve Future Civilian Strategic Workforce Plans, GAO-12-1014 (Washington D.C.: Sept. 27, 2012). selection of these three functional communities does not constitute a representative sample of DOD’s 22 functional communities. Thus, while the results cannot be projected to all functional communities, they did provide us with important insights. For each of the three functional communities selected, we reviewed GAO and Office of Personnel Management guidance regarding strategic workforce planning, and compared DOD’s current approach to developing and integrating functional community–specific information into its Strategic Workforce Plan against that guidance.

Functional community managers are responsible for monitoring the strategic human- capital planning efforts for their respective communities, including workforce forecasting, competency assessment, and strategy development. findings and conclusions based on our audit objectives. We believe that the evidence obtained provides a reasonable basis for our findings and conclusions based on our audit objectives.

Appendix II: DOD’s Functional Communities and Mission-Critical Occupations

The Department of Defense (DOD) uses a functional-community construct and functional-community categories to group together employees who perform similar functions. Mission-critical occupations are those occupations that are critical to the success of meeting the DOD mission within its functional communities. For the Fiscal Year 2013-2018 Strategic Workforce Plan, the department expanded its functional community construct from 12 functional communities to 22 functional communities and from 24 mission-critical occupations to 32 mission- critical occupations. Table 2 identifies the department’s functional communities and mission-critical occupations.

Appendix III: Status of Prior GAO Recommendations Related to Strategic Workforce Planning

In prior reports on the Department of Defense’s (DOD) strategic workforce-planning efforts, we made several recommendations for executive action to improve DOD’s strategic workforce plan and the department’s approach to strategic workforce planning. We consider a recommendation open if DOD has not taken or has not completed actions to address a recommendation. We consider a recommendation closed– implemented once DOD has taken action to satisfy the intent of the recommendation. We consider a recommendation closed–not implemented if the intent of the recommendation has not been satisfied or circumstances have rendered the recommendation invalid. We are continuing to monitor DOD’s efforts to address these recommendations. Table 3 summarizes our recommendations, DOD’s response to our recommendations, and what actions, if any, DOD has taken to address them.

Appendix IV: GAO’s Assessment of the Extent to Which DOD’s Civilian Workforce Plan Addresses Statutory Requirements

This appendix provides our assessment of the extent to which the Department of Defense’s (DOD) Fiscal Year 2013-2018 Strategic Workforce Plan for its overall civilian workforce, civilian senior-leader workforce, and financial-management workforce address statutory requirements in Section 115b of Title 10 of the United States Code in the following three tables.

Appendix V: Comments from the Department of Defense

Appendix VI: GAO Contact and Staff Acknowledgments

GAO Contact

Staff Acknowledgments

In addition to the above named contact, David Moser, Assistant Director; James Kernen; Steven Lozano; Brian Pegram; Michael Pose; Terry Richardson; Jennifer Weber; Erik Wilkins-McKee; and Michael Willems made key contributions to this report.

Related GAO Products

Human Capital: Additional Steps Needed to Help Determine the Right Size and Composition of DOD’s Total Workforce. GAO-13-470. Washington, D.C.: May 29, 2013.

High-Risk Series: An Update. GAO-13-283. Washington, D.C.: February 14, 2013.

Human Capital: Critical Skills and Competency Assessments Should Help Guide DOD Civilian Workforce Decisions. GAO-13-188. Washington, D.C.: January 17, 2013.

Human Capital: DOD Needs Complete Assessment to Improve Future Civilian Strategic Workforce Plans. GAO-12-1014. Washington, D.C.: September 27, 2012.

Human Capital: Complete Information and More Analyses Needed to Enhance DOD’s Civilian Senior Leader Strategic Workforce Plan. GAO-12-990R. September 19, 2012.

DOD Civilian Workforce: Observations on DOD’s Efforts to Plan for Civilian Workforce Requirements. GAO-12-962T. Washington, D.C.: July 26, 2012.

Defense Acquisition Workforce: Improved Processes, Guidance, and Planning Needed to Enhance Use of Workforce Funds. GAO-12-747R. Washington, D.C.: June 20, 2012.

Defense Acquisitions: Further Actions Needed to Improve Accountability for DOD’s Inventory of Contracted Services. GAO-12-357. Washington, D.C.: April 6, 2012.

Defense Workforce: DOD Needs to Better Oversee In-sourcing Data and Align In-sourcing Efforts with Strategic Workforce Plans. GAO-12-319. Washington, D.C.: February 9, 2012.

DOD Civilian Personnel: Competency Gap Analyses and Other Actions Needed to Enhance DOD’s Strategic Workforce Plans. GAO-11-827T. Washington, D.C.: July 14, 2011.

Human Capital: Opportunities Exist for DOD to Enhance Its Approach for Determining Civilian Senior Leader Workforce Needs. GAO-11-136. Washington, D.C.: November 4, 2010.

Human Capital: Further Actions Needed to Enhance DOD’s Civilian Strategic Workforce Plan. GAO-10-814R. Washington, D.C.: September 27, 2010.

Human Capital: Opportunities Exist to Build on Recent Progress to Strengthen DOD’s Civilian Human Capital Strategic Plan. GAO-09-235. Washington, D.C.: February 10, 2009.

Human Capital: The Department of Defense’s Civilian Human Capital Strategic Plan Does Not Meet Most Statutory Requirements. GAO-08-439R. Washington, D.C.: February 6, 2008.

DOD Civilian Personnel: Comprehensive Strategic Workforce Plans Needed. GAO-04-753. Washington, D.C.: June 30, 2004.