Defense Management: DOD Needs to Address Inefficiencies and Implement Reform across Its Defense Agencies and DOD Field Activities
Highlights
What GAO Found
The Department of Defense (DOD) does not comprehensively or routinely assess the continuing need for its defense agencies and DOD field activities (DAFAs). DOD was statutorily required to review the services and supplies each DAFA provides to ensure there is a continuing need for each and that the provision of services and supplies by each DAFA, rather than by the military departments, is more effective, economical, or efficient. A DOD directive requires the recording of the review. DOD previously issued biennial reports to Congress to record its review. Since 2012, DOD has relied on existing processes to fulfill the requirement; such as the annual budget process and the day-to-day management of the DAFAs. However, DOD did not provide sufficient evidence that these processes satisfy the statute. For example, while DOD reviews the DAFAs during the budget process, it does not specifically review the provision of services by the DAFAs rather than the military departments. Further, DOD does not have internal guidance that provides clear direction for conducting and recording its response to the statutory requirement. Without such guidance, DOD is limited in its ability to clearly define or target the scope of its reviews and any resulting reports. As such, DOD and congressional decision makers may not have reasonable assurance of a continuing need for the DAFAs, or that the provision of services and supplies is effective, economical, and efficient.
There is fragmentation and overlap within the DAFAs that provide human resources services to other defense agencies or organizations within DOD. At least six DOD organizations, including three DAFAs, perform human resources services for other parts of the department. One DAFA receives human resources services from all six organizations. This has resulted in negative effects, such as inconsistent performance information regarding hiring, fragmented information technology systems, and inefficiencies associated with overhead costs. For example, DOD officials stated that there are over 800 fragmented information technology systems used to store and record training records across the department, which are costly to maintain. DOD established a reform team to reduce inefficiencies within this business function. However, the team lacks comprehensive information on overhead costs that could guide reform and does not have time frames or deliverables for completing certain reform initiatives. With consistent human resource performance information, comprehensive information on overhead costs, and clear time frames in place, the team would be better positioned to thoroughly assess the department's system for human resources service delivery and develop and implement long-term solutions for better coordination or consolidation of this function.
DOD has taken some steps to monitor and evaluate the results of key efficiency initiatives that affect the DAFAs. However, DOD has not always established baselines or performed ongoing monitoring of its initiatives. Further, DOD has focused on whether steps have been taken, rather than outcomes achieved. For example, DOD did not evaluate whether a prior efficiency initiative called the Core Business Process Review achieved any of its intended savings or led to expected efficiencies. Without ensuring that efficiency initiatives are fully monitored and evaluated against established baselines over time, DOD lacks a systematic basis for evaluating whether its various initiatives have improved the efficiency or effectiveness of its programs or activities.
Why GAO Did This Study
DOD spends billions of dollars annually to maintain business functions that support the warfighter. Many of these functions are performed by the DAFAs—DOD's 19 defense agencies and 8 field activities intended to provide department-wide consolidated support functions. GAO has previously identified instances of fragmentation, overlap, and duplication among the DAFAs.
Senate Report 115-125, accompanying a bill for the National Defense Authorization Act for Fiscal Year 2018, included a provision that GAO review the DAFAs. This report evaluates the extent to which (1) DOD has assessed the continuing need for each DAFA; (2) any overlap or fragmentation among the DAFAs that provide human resources services has affected service delivery; and (3) DOD has monitored and evaluated the results of its efficiency initiatives that affect the DAFAs. GAO reviewed legal requirements, assessed prior DOD reports, and analyzed DOD's human resources activities and documentation tracking past efficiency initiatives.
Recommendations
GAO is making five recommendations, including for DOD to develop internal guidance to conduct and record its reviews of DAFAs; collect consistent performance information and comprehensive overhead cost information; establish time frames and deliverables for key reform efforts; and ensure routine and comprehensive monitoring and evaluation of ongoing efficiency initiatives. DOD concurred with GAO's recommendations.
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Defense | The Secretary of Defense should ensure that the Chief Management Officer (CMO) develops internal guidance that defines the requirements and provides clear direction for conducting and recording reviews of the Defense Agencies and DOD Field Activities in response to 10 U.S.C. § 192(c). This guidance, which could be similar to the guidance that exists for assessments of the combat support agencies, should reflect the key elements of quality evaluations. (Recommendation 1) |
Closed – Implemented
DOD concurred with this recommendation and noted planned actions. In its written comments, DOD stated that the National Defense Authorization Act for Fiscal Year 2019 gives the CMO additional specific authorities and substantially rewrites the requirements of section 192(c). In April 2019, DOD submitted to Congress its initial plan for business operations reform, which provided an initial plan, schedule, and cost estimate for conducting reforms within the enterprise business operations across all organizations and elements of the department. The plan describes in detail the Office of the CMO's responsibilities for conducting efficiency and effectiveness reviews of the Defense Agencies and DOD Field Activities in order to identify duplicative activities. Further, in August 2019, in response to this recommendation, DOD issued guidance for reviews of the DAFAs. The guidance reflects key elements of quality evaluations including: (1) requiring frequent data-driven reviews that would support high quality, sufficient, and appropriate data for their evaluations; (2) establishing a clear criteria for selecting DAFAs to review, and (3) ensuring results of the review are relevant to leadership stakeholders. DOD's actions meet the intent of this recommendation and it is considered closed as implemented.
|
| Department of Defense | The Secretary of Defense should ensure that the CMO, with input from the human resources management team, requires that all DOD human resources providers adopt consistent time-to-hire measures, as one process for assessing performance. (Recommendation 2) |
Open – Partially Addressed
DOD concurred with this recommendation and noted planned actions. In March 2020, DOD provided a corrective action plan that detailed the department's efforts to map the civilian hiring process across the department, including standard definitions for key activities and associated timeframes for each segment of the process. The corrective action plan was based on oversight and review to be provided by the human resources management reform team and the Chief Management Officer (CMO). In January 2021, the position of CMO was disestablished. Responsibilities for the department's reform efforts were transferred to the Performance Improvement Directorate within the Office of Director of Administration and Management (DA&M). According to DOD officials, as of June 2021, the human resources management team no longer exists. In September 2023, DA&M officials provided examples of time-to-hire data reported in the department's Business Health Metrics system. However, it was not clear from the data shown what hiring actions were being used in measuring time-to-hire, and therefore there is still a risk of these data being inconsistent. In December 2023, a DOD official from the office of the Undersecretary of Defense (Personnel and Readiness) stated that DOD leadership had been focused on time to hire as an emphasis in the department's talent management efforts. However, DOD did not provide documentation showing that time-to-hire was being calculated consistently across the department. The official agreed to obtain more specific documentation about how DOD components measure time-to-hire. Until DOD fully implements consistent department-wide time-to-hire measure it will be limited in its ability to assess and improve the performance measurement of its civilian hiring process.
|
| Department of Defense | The Secretary of Defense should ensure that the CMO, through the human resources management reform team, identifies time frames and deliverables for identifying and adopting optimal IT solutions for human resources and fully assessing, identifying, and implementing the most effective and efficient means of human resources service delivery. (Recommendation 3) |
Open – Partially Addressed
DOD concurred with this recommendation and noted planned actions. In its written comments, DOD stated the department is on track to achieve substantial savings through its reform team efforts and CMO emphasis on strong management practices, integrated processes, and best value business investments. In March 2020, DOD provided a correction action plan for this action that identified steps the department had taken to adopt optimal IT solutions for human resources delivery within the department. DOD officials stated that the overarching timeframes and deliverables for human resources management IT modernization were to be part of a broader civilian human capital operating plan and overseen through senior-level quarterly reviews. The corrective action plan was based on oversight and review to be provided by the human resources management reform team and the Chief Management Officer (CMO). In January 2021, the position of CMO was disestablished. Responsibilities for the department's reform efforts were transferred to the Performance Improvement Directorate within the Office of Director of Administration and Management (DA&M). According to DOD officials, as of June 2021, the human resources management team no longer exists. In April 2022, DOD provided a closure request for this recommendation, stating that this recommendation should be closed as not implemented, as the CMO and reform team no longer exist. Further, DOD officials stated that currently the office responsible for implementing this recommendation does not have the internal capability or owner to further progress of seeking an optimal IT solution. Although the CMO and reform team no longer exist, we continue to believe it is important that DOD seek to adopt an optimal IT solution for human resources and implement the most effective and efficient means of human resources service delivery. DOD has continued to take some steps that could help address this recommendation. For example, in August 2023, the Deputy Secretary of Defense identified several priority cross-cutting performance improvement initiatives in the department, including the implementation of new enterprise solutions and IT systems to support human resource operations. However, implementation of that initiative is still ongoing. We will continue to monitor these efforts and the extent to which they will address our recommendation.
|
| Department of Defense | The Secretary of Defense should ensure that the CMO, through the human resources management reform team, collects information on the overhead costs charged by all DOD human resources service providers to assist in determining the most effective, economical, and efficient model of human resources service delivery within the department. (Recommendation 4) |
Open – Partially Addressed
DOD concurred with this recommendation and noted planned actions. In its written comments, DOD stated the department is on track to achieve substantial savings through its reform team efforts and CMO emphasis on strong management practices, integrated processes, and best value business investments. In March 2020, DOD provided a corrective action plan for this action that identified steps the department has taken to collect information on overhead costs and further its effort to determine the most effective, economical, and efficient model of human resources delivery within the department. DOD officials stated that a working group would develop a cost model and performance measures, which would include overhead cost information. Additionally, the working group was to review and compare human resources service providers across the federal government and private sectors. These efforts were still in development or early implementation at that time and the department had not yet used them to determine the optimal human resources delivery model. The corrective action plan was based on oversight and review to be provided by the human resources management reform team and the Chief Management Officer (CMO). In January 2021, the position of CMO was disestablished. Responsibilities for the department's reform efforts were transferred to the Performance Improvement Directorate within the Office of Director of Administration and Management (DA&M). According to DOD officials, as of June 2021, the human resources management team no longer exists. In April 2022, DOD provided a closure request for this recommendation, stating that this recommendation should be closed as not implemented, as the CMO and reform team that this recommendation is addressed to no longer exist. Further, DOD officials stated that currently the office responsible for implementing this recommendation does not have the internal capability or owner to further progress on collecting the needed information on overhead costs related to human resources service providers. Although the CMO and reform team no longer exist, we continue to believe it is important that DOD seek to obtain information on overhead costs. Until DOD fully develops and implements its costing model and associated framework, it will be limited in its ability to determine the most effective and efficient means of human resources service delivery. DOD has continued to take some steps that could help address this recommendation. For example, in August 2023, the Deputy Secretary of Defense identified several priority cross-cutting performance improvement initiatives in the department, including the implementation of new enterprise solutions and IT systems to support human resource operations. However, implementation of that initiative is still ongoing. We will continue to monitor these efforts and the extent to which they will address our recommendation.
|
| Department of Defense |
Priority Rec.
The Secretary of Defense should ensure that the CMO routinely and comprehensively monitors and evaluates ongoing efficiency initiatives within the department, including those related to the reform teams. This monitoring should include establishing baselines from which to measure progress, periodically reviewing progress made, and evaluating results. (Recommendation 5) |
Open – Partially Addressed
DOD concurred with our recommendation. In January 2021, the position of CMO was disestablished. Responsibilities for the department's reform efforts were transferred to the Performance Improvement Directorate within the Office of Director of Administration and Management (DA&M). In October 2022, the Deputy Secretary of Defense issued the department's new Performance Improvement Framework, which provides a consistent methodology to define, identify, track, and report on existing and planned opportunities for performance improvement across DOD, including those that enable cost savings. In November 2022, DA&M issued a memorandum instructing Principal Staff Assistants and Component heads to build an authoritative repository of Performance Improvement Initiatives, including establishing a baseline to document current and prior year initiatives that had been overseen by the CMO. Further, the memo announced establishment of an authoritative performance management executive analytics platform, known as Pulse, to monitor implementation of Performance Improvement initiatives. DOD provided results from this initial data collection as a part of the FY2024 Defense Budget Overview in March 2023, and plans to continue to report annually on performance improvement efforts.In addition, in August 2023, the Deputy Secretary of Defense established a new senior governance structure for overseeing the department's Strategic Management Plan (SMP), including designating the Deputy's Management Action Group as the primary body for overseeing the (SMP), supported by a new Defense Performance Improvement Council. According to DA&M officials, the Performance Improvement Framework is intended to be aligned with the SMP, and monitoring of implementation of the SMP could include monitoring related performance improvement initiatives. These efforts represent important steps forward in implementing this recommendation. To fully demonstrate implementation, DOD should document baselines and demonstrate progress made on performance improvement initiatives once the data have been analyzed.
|