It has been stated that some reform of the military staff system is necessary to provide the civilian leadership with more objective judgments as to what priorities should exist. Some believe that it is too much to expect that the JCS, whose members are also individual Service Chiefs, and a Joint Staff composed of members who serve brief tours always dependent on their individual service for promotion, career path, etc. could be institutionally capable of providing the Secretary of Defense with the kind of objective advice he needs.

Many different proposals have been advanced, e.g., strengthening the role of the Chairman of the Joint Chiefs; changing to a single Chief of Staff, supported by the General Staff with a unique promotion track, etc.

It might very well be appropriate to consider JCS reform in conjunction with our proposals for the reorganization of OSD and the acquisition process.

Early in our investigations, we found that structural and cultural problems in the Department of Defense (DOD) often inhibited, and sometimes totally prevented, successful exploitation of cost saving opportunities. We interviewed civilian and military managers at all levels throughout DOD and talked with former officials and other experts with particular insights into these matters. We studied how the organization is structured and how it operates. From this background and our private sector experience, we developed recommendations for improvement. While some of our recommendations will result directly in identifiable savings, we expect most of them will accomplish more by improving the structure and functioning of the organization, and thus will provide a supportive apparatus for ongoing cost savings activity.

The Introduction noted that DOD is probably the most complex organization in the free world. Beyond this inherent complexity, there is a major factor which has a pervasive impact on the efficiency and effectiveness of DOD's operation -- management turnover. There are several understandable reasons for this high turnover:

The political cycle virtually assures a complete change of top management at least every four years. In fact, the average service of Secretaries of Defense has been 26 months.

Military transfer policies establish the tour of duty for officers in DOD as three years.

Military and civilian retirement policies provide
incentives for successful top managers to retire
a number of years earlier than their counterparts
in the private sector - often just as experience
brings them to the peak of their productivity.

Salaries and other rewards for top managers are not competitive enough to attract or retain the highest caliber people, except for those who are more motivated by psychological rewards.

Frustration over not being able to make right things happen frequently drives managers to leave after brief careers.

Top management turnover is a problem throughout Government, and certainly is not unique to DOD. Even though we understand that reduction in turnover could bring improved efficiency, we have taken high turnover as a given and focused our attention on factors more controllable within DOD.

In our investigations, we probed primarily to find the areas which need to be improved. Thus, we deal in our report almost exclusively with the negative aspects of organization structure and culture. Lest this be misunderstood, we must make several important points:

Our

O To varying extents, most large organizations exhibit the kinds of problems we saw in DOD. interest is to point out, based on private sector experience, how DOD might improve the way it handles organizational problems.

We interviewed, and were otherwise exposed to,
large numbers of managers throughout DOD during
the four months of our investigation. While our
objective was not to evaluate individual perfor-
mance, we were impressed with many of the civilian
managers and their level of talent and experience.
We were particularly impressed by the breadth of
outlook, the dedication and level of administra-
tive and managerial skill we saw in the senior
military officers.

We have not dealt with the question of financial
rewards. Obviously, the statutory limit on the
salaries of top managers and the rapidly escala-
ting salaries of those below this limit combine
to provide a wrenching force within this organi-
zation. When we talk of the reward system, we
mean to include promotion, status, recognition
and all of those intangibles which are so helpful
in motivating managers to take increased responsi-
bility, to perform better, and to gain additional
satisfaction from their jobs.

In our study we found attitudes, traits, traditions and practices which prevent DOD from performing its mission as effectively and economically as it might. These can be. grouped into four major topic areas:

Roles and Missions,

Personal Accountability,
Management Focus, and
Resistance to Change.