The Department of Defense’s (DOD) operations and maintenance accounts represent a significant portion of the defense budget (37 percent of the budget in fiscal year 1998) and support key aspects of readiness, including field training exercises and the maintenance of equipment. While the Secretary of Defense has stated that he wants to provide enough funding in future programs and budgets to ensure forces are ready to carry out missions at acceptable levels of risk, there is uncertainty whether readiness accounts will be fully funded. In particular, DOD has sought to increase procurement funding for weapon system modernization and has acknowledged that it must reduce its operations and maintenance accounts to free up dollars for modernization. For this reason, DOD officials will need to closely monitor readiness levels to detect any emerging problems. DOD’s readiness assessment system is designed to assess and report on military readiness at three levels—(1) at the individual unit level; (2) at the joint force level; and (3) at the aggregate, or strategic, level. “Unit readiness” refers to the ability of units, such as Army divisions, Navy ships, and Air Force wings, to provide capabilities required of the combatant commands and is derived from the ability of each unit to deliver the outputs for which it was designed. “Joint readiness” is the combatant commands’ ability to integrate and synchronize units from one or more of the services to execute missions. “Strategic readiness” is a synthesis of unit and joint readiness and concerns the ability of the armed forces as a whole, to include the services, the combatant commands, and the combat support agencies, to fight and meet the demands of the national security strategy. Strategic readiness focuses on broad functional areas, such as intelligence and mobility, that meet worldwide demands. The foundation for assessing readiness at the unit level is the Status of Resources and Training System (SORTS), an automated system for measuring the extent to which individual military units possess the required resources and training to undertake their wartime missions. To address joint readiness, the Chairman of the Joint Chiefs of Staff established the Joint Monthly Readiness Review (JMRR) in 1994. During this review process, the Joint Staff compiles readiness assessments from the combatant commands, the combat support agencies, and the military services. The Joint Staff and the services use the JMRR assessments to brief DOD’s leadership on the Senior Readiness Oversight Council (SROC)—an executive-level forum for monitoring emerging readiness issues at the strategic level. From these briefings to the Council, DOD prepares a legislatively mandated quarterly readiness report to Congress. Figure 1.1 provides an overview of DOD’s readiness assessment process. The readiness of individual military units has long been the focus of DOD’s readiness assessment process. The foundation for assessing unit readiness is SORTS, an automated reporting system that functions as the central listing of more than 9,000 operational units. SORTS indicates, at a selected point in time, the status of personnel; equipment and supplies on hand; equipment condition; and training, as reported by each unit. In their reports, each unit commander also assess the unit’s ability to execute its wartime mission, indicated by one of five “C” levels. Units are required to submit their SORTS reports on a regular basis or when there is a change in their C level or location. As a resource and unit monitoring system, SORTS is designed to support the information requirements of the Joint Staff, combatant commands, and military services for crisis response planning, peacetime planning, and management responsibilities to organize, train, and equip forces. For example, SORTS is intended to give users the ability to prepare lists of units that are readily available; estimate the time for earliest commitment of units based on their location relative to the situation; assist in identifying or confirming major constraints on the employment of units; track the location and resource status of assigned units; provide unit data for other automated systems; confirm shortfalls and distribution problems with unit resources; confirm which units are best able to support the redistribution of resources; and monitor corrections to shortfalls and problems. The Joint Staff has overall responsibility for policies and procedures governing SORTS. The services and the U.S. Special Operations Command are required to ensure that all units comply with joint SORTS reporting policies and have issued implementing instructions to supplement these policies. The services, with the exception of the Marine Corps, require additional service-unique information to be included in unit SORTS reports. Senior military and civilian officials within DOD are briefed on current readiness through two forums—the JMRR and the SROC. The JMRR was instituted in late 1994 in response to a directive from the Chairman of the Joint Chiefs of Staff to define, measure, and fix readiness. The Joint Staff’s Readiness Division, established in the fall of 1994, is the proponent for the JMRR. The JMRR is designed, among other things, to alert the Joint Staff to any critical problems that affect readiness and to analyze the military’s ability to execute wartime scenarios. The Vice Chairman of the Joint Chiefs of Staff chairs the JMRR meetings, and a wide range of military officials attend. The JMRR forms the basis for briefings to the SROC, a group of senior DOD officials who meet monthly to review current readiness issues. The Council, which was in existence before the JMRR, changed its focus from future readiness to current readiness about the same time the JMRR was instituted. The Deputy Secretary of Defense chairs the Council, and senior officials from the Office of the Secretary of Defense (OSD), the services, and the Joint Staff attend. During SROC meetings, the services provide their assessments of unit readiness, and the Joint Staff provides a joint readiness assessment. The briefings to the Council are intended to present a view of readiness at the strategic level. For instance, the Joint Staff reports on elements of strategic concern, such as mobility shortfalls, that are based on readiness deficiencies reported through the JMRR. Similarly, the services report on the readiness of major combat units and on broad trends in personnel, equipment, and training. In addition, the Deputy Secretary of Defense periodically tasks the Joint Staff and the services to brief the SROC on special readiness topics. In April 1997, for instance, the services briefed the SROC on personnel shortfalls and pilot attrition. DOD is required under 10 U.S.C. 482 to prepare a quarterly readiness report to Congress. Under 10 U.S.C. 482(b), DOD must “specifically describe (1) each readiness problem and deficiency identified . . . (2) planned remedial actions; and (3) the key indicators and other relevant information related to each identified problem and deficiency.” In mandating the report, Congress hoped to enhance its oversight of military readiness. The reporting requirement was expanded in 1997 to require DOD to include additional readiness indicators in the quarterly reports beginning in late 1998. Examples of these indicators are historical and projected personnel trends, operations tempo, and equipment availability. DOD submitted its first quarterly report in May 1996. The reports are unclassified, but a classified annex is also submitted. A typical quarterly report is fewer than 20 pages, of which about two-fifths is devoted to sections that quote the legislative reporting requirement, describe DOD’s readiness assessment process, and list abbreviations. The remaining sections of the report highlight major readiness issues and summarize current readiness. The classified annex, among other things, provides the Chairman’s overall risk assessment based on the wartime scenario used in the JMRR. On the basis of the briefings presented to the SROC, Joint Staff officials write the first draft of the quarterly report and send it for informal review to an OSD official responsible for readiness assessment. This official reviews the report for accuracy and completeness and may suggest changes. Service readiness officials also review the first draft. After incorporating changes, the Joint Staff sends the revised report back to OSD for formal approval. The report is first approved by the Under Secretary of Defense for Personnel and Readiness. Then it is transmitted to senior officials in the services, other OSD offices, and the defense agencies for their concurrence. Once this concurrence is received, the report is sent to the Chairman of the Joint Chiefs of Staff, the Deputy Secretary of Defense, the Secretary of Defense, and finally to Congress. Congress has expressed concern regarding apparent inconsistencies between DOD’s official readiness reports and the actual readiness of units in the field. Due to these concerns, the Senate and House military readiness subcommittees asked us to review DOD’s efforts to improve its process of assessing and reporting readiness. Specifically, we assessed whether (1) DOD plans to make improvements to SORTS, including adding specific readiness indicators; (2) the JMRR process has improved DOD’s ability to assess readiness; and (3) the quarterly readiness reports to Congress accurately reflect readiness information briefed to senior DOD officials and provide information needed for oversight of military readiness. We reviewed previous studies by our office, DOD, and other organizations to identify reported problems with SORTS and recommendations to improve the system. To evaluate DOD’s plans to improve the system and to add readiness indicators, we interviewed officials and reviewed pertinent documentation at the Deputy Under Secretary of Defense (Readiness), the Joint Staff, and service headquarters. We also interviewed the DOD contractor that assisted OSD in studying the readiness assessment system. We did not test the reliability of the SORTS database to report the readiness status of units. To understand how DOD assesses and reports readiness at the joint and strategic levels, we met with cognizant officials at OSD, the Joint Staff, and the services to discuss the JMRR and SROC processes and the development of the quarterly readiness reports to Congress.