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Report to Congressional Committees: 

United States Government Accountability Office: 

GAO: 

September 2006: 

Force Structure: 

Army Needs to Provide DOD and Congress More Visibility Regarding 
Modular Force Capabilities and Implementation Plans: 

Force Structure: 

GAO-06-745: 

GAO Highlights: 

Highlights of GAO-06-745, a report to congressional committees 

Why GAO Did This Study: 

The Army considers its modular force transformation its most extensive 
restructuring since World War II. Restructuring units from a division-
based force to a modular brigade-based force will require an investment 
of over $52 billion, including $41 billion for equipment, from fiscal 
year 2005 through fiscal year 2011, according to the Army. 

Because of broad congressional interest in this initiative, GAO 
prepared this report under the Comptroller General’s authority and 
assessed (1) the Army’s progress and plans for equipping modular combat 
brigades, (2) progress made and challenges to managing personnel 
requirements of the modular force, and (3) the extent to which the Army 
has developed an approach for assessing the results of its modular 
conversions and the need for further changes to designs or 
implementation plans. 

What GAO Found: 

The Army is making progress in creating active and National Guard 
modular combat brigades while fully engaged in ongoing operations, but 
it is not meeting its equipping goals for active brigades and has not 
completed development of an equipping strategy for its new force 
rotation model. This raises uncertainty about the levels to which the 
modular brigades will be equipped both in the near and longer term as 
well as the ultimate equipping cost. The Army plans to employ a force 
rotation model in which units nearing deployment would receive required 
levels of equipment while nondeploying units would be maintained at 
lower readiness levels. However, because the Army has not completed key 
details of the equipping strategy—such as defining the specific 
equipping requirements for units in various phases of its force 
rotation model—it is unclear what level of equipment units will have, 
how this strategy may affect the Army’s equipment funding plans, and 
how well units with low priority for equipment will be able to respond 
to unforeseen crises. 

While the Army has several initiatives under way to meet its modular 
force personnel requirements in the active component, it faces 
challenges in achieving its modular restructuring without permanently 
increasing its active component end strength above 482,400, as 
specified by the 2006 Quadrennial Defense Review. The Army plans to 
increase its active combat force but doing so without permanently 
increasing its overall active end strength will require the Army to 
eliminate or realign many positions in its noncombat force. The Army 
has made some progress in reducing military personnel in noncombat 
positions by converting some to civilian positions and pursuing other 
initiatives, but Army officials believe future initiatives may be 
difficult to achieve and could lead to difficult trade-offs. Without 
information on the progress of these initiatives and what risks exist 
if the Army’s goals are not met, Congress and the Secretary of Defense 
lack the information they need to understand challenges and risks. 

Finally, the Army does not have a comprehensive and transparent 
approach to measure progress against its modularity objectives, assess 
the need for further changes to modular designs, and monitor 
implementation plans. While GAO and DOD have identified the importance 
of establishing objectives that can be translated into measurable 
metrics that in turn provide accountability for results, the Army has 
not established outcome-related metrics linked to most of its 
modularity objectives. Further, although the Army is analyzing lessons 
learned from Iraq and training events, the Army does not have a long-
term comprehensive plan for further analysis and testing of its modular 
combat brigade designs and fielded capabilities. Without performance 
metrics and a comprehensive testing plan, neither the Secretary of 
Defense nor Congress will have full visibility into how the modular 
force is currently organized, staffed, and equipped. As a result, 
decision makers lack sufficient information to assess the capabilities, 
cost, and risks of the Army’s modular force implementation plans. 

What GAO Recommends: 

GAO recommends that the Army develop and submit to Congress information 
about its modular force equipping strategy, personnel initiatives, and 
plans for assessing implementation progress. DOD generally agreed with 
three recommendations but disagreed to develop and provide to Congress 
risk assessments and evaluation plans. GAO added a matter for 
congressional consideration because it believes these actions are 
needed to improve accountability and transparency. 

[Hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-06-745]. 

To view the full product, including the scope and methodology, click on 
the link above. For more information, contact Janet St. Laurent at 
(202) 512-4402 or stlaurentj@gao.gov. 

[End of Section] 

Contents: 

Letter: 

Results in Brief: 

Background: 

Army Is Well Under Way in Its Modular Combat Brigade Conversions, but 
Its Ability to Meet Near-and Long-Term Equipping Goals Is Unclear: 

Army Faces Challenges in Managing Active Component Personnel 
Requirements for Its New Modular Force Structure: 

Army Has Overall Objectives and Time Frames for Modularity, but Lacks a 
Long-Term Comprehensive Approach to Assess Progress and Monitor 
Implementation: 

Conclusions: 

Recommendations for Executive Actions: 

Matter for Congressional Consideration: 

Agency Comments and Our Evaluation: 

Appendix I: Scope and Methodology: 

Appendix II: Comments from the Department of Defense: 

Appendix III: GAO Contact and Staff Acknowledgments: 

Tables: 

Table 1: Planned Numbers of Modular Combat Brigades in the Active 
Component and National Guard as of March 2006: 

Table 2: Army Schedule for Creating Active Component and National Guard 
Modular Combat Brigades as of March 2006: 

Table 3: Modular Force Cost Estimates for the Entire Army by Function: 

Table 4: Army's End-strength Authorization History and Modular Force 
Goal: 

Figures: 

Figure 1: Standard Heavy, Infantry, and Stryker Combat Brigades: 

Figure 2: Army's Force Rotation Model: 

United States Government Accountability Office:
Washington, DC 20548: 

September 6, 2006: 

Congressional Committees: 

In 2004, the Army began its modular force transformation to restructure 
itself from a division-based force to a modular brigade-based force--an 
undertaking it considers the most extensive reorganization of its force 
since World War II. This initiative, according to Army estimates, will 
require a significant investment exceeding $52 billion through fiscal 
year 2011, at a time when the Army is fully engaged in a high pace of 
operations and is facing many other demands for funding such as the 
Future Combat System program, now expected to cost over $160 
billion.[Footnote 1] The foundation of the modular force is the 
creation of standardized modular combat brigades in both the active 
component and National Guard. The new modular brigades are designed to 
be stand-alone, self-sufficient units that are more rapidly deployable 
and better able to conduct joint and expeditionary operations than 
their larger division-based predecessors. The Army plans to achieve its 
modular restructuring without permanently increasing its active 
component end strength above 482,400, in accordance with a Department 
of Defense (DOD) decision reached during the 2006 Quadrennial Defense 
Review (QDR). It plans to achieve this primarily by eliminating some 
noncombat positions in which military personnel currently serve, and 
transferring these positions to its operational combat forces.[Footnote 
2] The February 2006 QDR also specified that the Army would create 70 
modular combat brigades in its active component and National Guard. 
This represents a 7-brigade reduction from the Army's original plan of 
having 77 modular combat brigades. However, according to Army 
officials, resources from the 7 brigades that were part of the original 
plan will be used to increase support units in the reserve component, 
and DOD officials believe that 70 brigades will be sufficient to 
execute the defense strategy. 

Because of the cost and magnitude of the Army's transformation plans, 
and broad congressional interest, we have initiated a body of work on 
both the force structure and cost implications of the Army's 
transformation to a modular force under the Comptroller General's 
statutory authority. We presented our preliminary observations on the 
Army's plan in a March 2005 hearing before the Subcommittee on Tactical 
Air and Land Forces, House Committee on Armed Services.[Footnote 3] In 
our September 2005 report on the cost of the modular force conversion, 
we reported that the Army's $48 billion total modular force conversion 
cost estimate was evolving and included uncertainties that may drive 
costs higher. We recommended that the Army clarify its definition of 
modular force costs including equipment costs, which constituted $41 
billion of the $48 billion estimate.[Footnote 4] In our April 2006 
testimony before the Subcommittee on Tactical Air and Land Forces, 
House Committee on Armed Services, we observed that the Army's cost 
estimate through fiscal year 2011 had increased from the earlier $48 
billion estimate to $52.5 billion, and that the Army faces significant 
challenges in executing its modularity plans to fully achieve planned 
capabilities within this current estimate and the time frames it has 
established for the modular conversion.[Footnote 5] This report focuses 
on the Army's plans for implementing the modular force initiatives, 
with an emphasis on active combat brigades, since the Army has already 
begun to restructure its active divisions to the new brigade-based 
designs. 

We are sending this report to you because of your oversight 
responsibilities on defense matters. Specifically for this report we 
assessed (1) the Army's progress and plans for equipping modular combat 
brigades, (2) progress made and challenges to managing personnel 
requirements of the modular force, and (3) the extent to which the Army 
has developed an approach for assessing the results of the modular 
conversions and for further adjusting designs or implementation plans. 

To assess the Army's progress and plans for equipping active component 
modular combat brigades, we analyzed Department of Army data on 
selected equipment that the Army identified as essential for achieving 
the modular combat brigades' intended capabilities. For these selected 
items, we analyzed the Army's active component equipment requirements 
obtained from the Department of the Army Office of the Deputy Chief of 
Staff for Operations and Training for each of the three brigade 
variants--heavy, light, and Stryker. We compared the equipment 
requirements of the brigades to data we obtained from officials from 
the Department of the Army Deputy Chief of Staff G-8[Footnote 6] on the 
levels of equipment expected to be on hand in 2007 and discussed plans 
for meeting key equipment requirements with these officials. We also 
reviewed unit readiness reports from those brigades that had completed 
or were in the process of completing their modular conversion as of 
February 2006. In addition, we visited the first three Army divisions 
undergoing modular conversions to obtain information on the plans for 
organizing, staffing, and equipping the modular brigades. To assess 
progress made and challenges to managing personnel requirements of the 
modular force, we reviewed documents and discussed the implications of 
force structure requirements with officials from the Department of Army 
Offices of the Deputy Chiefs of Staff for Personnel, Intelligence, and 
Operations and Training, and the Office of the Assistant Secretary of 
the Army for Manpower and Reserve Affairs. We also reviewed the 2006 
Quadrennial Defense Review (QDR) Report. Finally, to assess the extent 
to which the Army has developed an approach for assessing the results 
of the modular conversions and for further adjusting designs or 
implementation plans, we examined key Army planning documents and 
discussed objectives, performance metrics, and testing plans with 
officials in the Department of the Army Office of the Deputy Chief of 
Staff for Operations and Training, and the Training and Doctrine 
Command. Also, we met with a panel of retired senior Army general 
officers at the Association of the U.S. Army Institute of Land Warfare. 
In addition, we relied on our past reports assessing organizations 
undertaking significant reorganizations. We conducted our work from 
September 2004 through March 2006 in accordance with generally accepted 
government auditing standards and determined that the data used were 
sufficiently reliable for our objectives. The scope and methodology 
used in our review are described in further detail in appendix I. 

Results in Brief: 

While the Army is well under way in creating active component modular 
combat brigades, it is not meeting its equipping goals for these 
brigades and has not yet completed its equipping strategy, which raises 
considerable uncertainty about the levels to which the modular brigades 
will be equipped both in the near and longer term and the ultimate 
equipment cost. The Army established equipping goals in its Campaign 
Plan in which converting units are expected to receive most of the 
major equipment items required by the new modular design within 
specified time frames. However, although the Army is procuring billions 
of dollars of new equipment required by its new modular design, units 
undergoing their modular conversions are not meeting these equipping 
goals due to several factors, including the challenges of undertaking 
such an extensive restructuring while managing equipment requirements 
for ongoing operations. In addition, brigades will initially lack 
planned quantities of items such as communications and surveillance 
systems necessary to provide the enhanced intelligence, situational 
awareness, and network capabilities that are essential for creating 
smaller, more flexible and mobile combat brigades. Moreover, the Army 
will likely face even greater challenges fully equipping 28 planned 
National Guard modular combat brigades since National Guard units have 
historically been underequipped and have transferred large quantities 
of equipment to deploying units. To mitigate equipment shortages, the 
Army is developing a force rotation model that will provide varying 
levels of equipment to brigades depending on how close they are to 
deployment. However, this strategy is not yet complete because key 
details have not been decided, including the types and quantities of 
equipment for brigades in each of the various phases of the model. 
Until the Army completes the development of its equipping strategy, it 
will not be possible to determine which units will be equipped, or how 
this strategy may affect the Army's equipment funding plans. It is also 
unclear how well units with low priority for equipment will be able to 
respond to unforeseen crises. 

While the Army has several initiatives under way to manage its modular 
force personnel requirements, it faces significant challenges achieving 
its modular restructuring without permanently increasing its active 
component end strength above 482,400, as specified by DOD's 2006 QDR 
report. The Army plans to increase the size of its modular combat force 
from 315,000 to 355,000, but doing so without permanently increasing 
its active component end strength is an ambitious undertaking that will 
require the Army to eliminate many positions in its noncombat force. 
Effective strategic workforce planning includes the development of 
strategies to monitor and evaluate progress towards achieving goals. 
However, the Army has not provided DOD or Congress with detailed 
information on the status of its various personnel initiatives and 
progress towards meeting its modular force personnel goals. We found 
some of the Army's personnel realignment and reduction initiatives may 
not meet the Army's initial goals or expectations. For example during 
fiscal year 2005, the Army converted approximately 8,000 military 
positions to civilian-staffed positions within the Army's noncombat 
force. However, Army officials believe additional conversions to 
achieve the 19,000 planned reductions in the noncombat force will be 
significantly more challenging to achieve. Also, the Army expected that 
the 2005 Base Realignment and Closure decisions would free up 
approximately 2,000 to 3,000 positions in the noncombat force, but it 
is revisiting this assumption based upon updated manpower levels at the 
commands and installations approved for closure or consolidation. As a 
result, it is not clear to what extent the Army will be able to meet 
its modular force requirements within its end-strength goal and what 
risks exist if these goals are not met. Furthermore, without 
information on the status and progress of these personnel initiatives, 
the Secretary of Defense and Congress lack the visibility necessary to 
assess the challenges and effectively address problems when they arise. 

While the Army has established overall objectives and time frames for 
modularity, it lacks a long-term comprehensive and transparent approach 
to effectively measure progress against stated modularity objectives, 
assess the need for further changes to its modular unit designs, and 
monitor implementation plans. GAO and DOD have identified the 
importance of establishing objectives that can be translated into 
measurable metrics, which in turn provide accountability for results. 
The Army has identified objectives and a timeline for modularity, but 
metrics for assessing the Army's progress on modularity-specific, 
quantifiable goals are extremely limited. Moreover, in 2004, the Army's 
Training and Doctrine Command (TRADOC) conducted a wide-ranging 
baseline analysis of the modular design using measures of combat 
effectiveness against simulated threats; however, the Army does not 
have a long-term plan to conduct a similar analysis so that it can 
compare the performance of actual modular units with the TRADOC- 
validated design. Army officials maintain that ongoing assessments such 
as observations of training events provide sufficient validation that 
the modularity concept works in practice. However, while these 
assessments are useful, they do not provide a comprehensive evaluation 
of the modular design as a whole. In November 2005, we reported that 
methodically testing, exercising, and evaluating new doctrines and 
concepts are important and established practices throughout the 
military, and that particularly large and complex initiatives may 
require long-term testing and evaluation guided by study 
plans.[Footnote 7] Without performance metrics and a comprehensive 
testing plan, neither the Army nor Congress will be able to assess the 
capabilities of and risks associated with the modular force as it is 
organized, staffed, and equipped. 

We are recommending that the Secretary of Defense direct the Secretary 
of the Army to develop and provide Congress with detailed information 
about the modular force equipping strategy, the status of its various 
personnel initiatives, and plans for developing an approach for 
measuring and assessing implementation progress. In commenting on a 
draft of this report, DOD fully or partially agreed with our 
recommendations to develop and provide information on its equipping 
strategy and personnel initiatives and to develop expanded performance 
metrics for assessing progress. However, DOD disagreed with our 
recommendations to develop and provide assessments of the risk 
associated with its equipping strategy and plans for staffing its 
modular operational combat force. It also disagreed with our 
recommendation to develop a testing plan for further assessing modular 
unit designs. DOD stated that it is assessing equipment risk and is 
continuing to evaluate all aspects of modular units' performance on a 
continuous basis. However, while Army officials are managing risk in 
allocating currently available equipment to Army units based on 
scheduled overseas deployments, the Army had not yet completed its 
equipping strategy for its new force rotation model at the time of our 
review and therefore had not conducted and documented a formal risk 
assessment of its equipping plans for implementing the new model. In 
addition, although the Army is conducting further evaluation of its 
modular forces through training exercises and modular unit deployments 
to Iraq and Afghanistan, it has not developed a plan to further test 
modular unit designs under a range of operational scenarios, such as 
major offensive combat operations. Moreover, it is not clear how and to 
what extent the Army is integrating lessons learned from training 
exercises and deployments into periodic evaluations to assess the need 
for further changes to the designs. Because of the significance, cost, 
scope, and potential for risk associated with the Army's modularity 
initiative along with the lack of transparency regarding these risks, 
we continue to believe our recommendations that the Army develop and 
provide Congress with additional plans and risk assessments are needed. 
Therefore, to facilitate greater transparency and improve 
accountability for results, we have included a matter for congressional 
consideration that Congress require the Secretary of Defense to submit 
more specific and complete information regarding the modular force 
equipping strategy, the status of its various personnel initiatives, 
risks associated with its plans, and efforts to measure and assess its 
progress in implementing modularity. 

DOD's comments are in appendix II and our evaluation of its comments is 
on page 28. 

Background: 

The Army's conversion to a modular force encompasses the Army's total 
force--active Army, Army National Guard, and Army Reserve--and directly 
affects not only the Army's combat units, but related command and 
support organizations. A key to the Army's new modular force design is 
embedding within combat brigades reconnaissance, logistics, and other 
support units that previously made up parts of division-level and 
higher-level command and support organizations, allowing the brigades 
to operate independently. Restructuring these units is a major 
undertaking because it requires more than just the movement of 
personnel or equipment from one unit to another. The Army's new modular 
units are designed, equipped, and staffed differently than the units 
they replace; therefore, successful implementation of this initiative 
will require changes such as new equipment and a different mix of 
skills and occupational specialties among Army personnel. By 2011, the 
Army plans to have reconfigured its total force--to include active and 
reserve components and headquarters, combat, and support units--into 
the modular design. The foundation of the modular force is the creation 
of modular brigade combat teams--combat maneuver brigades that will 
have a common organizational design and are intended to increase the 
rotational pool of ready units. Modular combat brigades (depicted in 
fig. 1) will have one of three standard designs--heavy brigade, 
infantry brigade, or Stryker brigade.[Footnote 8] 

Figure 1: Standard Heavy, Infantry, and Stryker Combat Brigades: 

[See PDF for image] 

Source: GAO analysis of Army data; National War College; National War 
College; and Army (images left to right). 

[End of figure] 

Until it revised its plans in early 2006, the Army had planned to have 
a total of 77 active component and National Guard modular combat 
brigades by expanding the Army's existing 33 combat brigades in the 
active component into 43 modular combat brigades by 2007, and by 
creating 34 modular combat brigades in the National Guard by 2010 from 
existing brigades and divisions that have historically been equipped 
well below requirements. To rebalance joint ground force capabilities, 
the 2006 QDR determined the Army should have a total of 70 modular 
combat brigades--42 active brigades and 28 National Guard brigades. 
Table 1 shows the Army's planned numbers of heavy, infantry, and 
Stryker combat brigades in the active component and National Guard. 

Table 1: Planned Numbers of Modular Combat Brigades in the Active 
Component and National Guard as of March 2006: 

Modular combat brigades: Heavy; 
Active component: 19; 
National Guard: 6; 
Total: 25. 

Modular combat brigades: Infantry; 
Active component: 17; 
National Guard: 21; 
Total: 38. 

Modular combat brigades: Stryker; 
Active component: 6; 
National Guard: 1; 
Total: 7. 

Modular combat brigades: Total; 
Active component: 42; 
National Guard: 28; 
Total: 70. 

Source: U.S. Army. 

[End of table] 

At the time of this report, the Army was in the process of revising its 
modular combat brigade schedule to convert its active component combat 
brigades by fiscal year 2010 instead of 2007 as previously planned, and 
convert National Guard combat brigades by fiscal year 2008 instead of 
2010. Table 2 shows the Army's schedule that reflects these changes as 
of March 2006. 

Table 2: Army Schedule for Creating Active Component and National Guard 
Modular Combat Brigades as of March 2006: 

Active component combat brigades; 
FY03: 2; 
FY04: 11; 
FY05: 8; 
FY06: 14; 
FY07: 3; 
FY08: 2; 
FY09: 1; 
FY10: 1; 
Total: 42. 

National Guard combat brigades; 
FY03: --; 
FY04: --; 
FY05: 7; 
FY06: 7; 
FY07: 7; 
FY08: 7; 
FY09: --; 
FY10: --; 
Total: 28. 

Total; 
FY03: 2; 
FY04: 11; 
FY05: 15; 
FY06: 21; 
FY07: 10; 
FY08: 9; 
FY09: 1; 
FY10: 1; 
Total: 70. 

Source: GAO analysis of Army data. 

[End of table] 

According to the Army, this larger pool of available combat units will 
enable it to generate both active and reserve component forces in a 
rotational manner. To do this, the Army is developing plans for a force 
rotation model in which units will rotate through a structured 
progression of increased unit readiness over time. Units will progress 
through three phases of operational readiness cycles, culminating in 
full mission readiness and availability to deploy. For example, the 
Army plans for active service members to be at home for 2 years 
following each deployment of up to 1 year. 

The Army's objective is for the new modular combat brigades, which will 
include about 3,000 to 4,000 personnel, to have at least the same 
combat capability as a brigade under the current division-based force, 
which range from 3,000 to 5,000 personnel. Since there will be more 
combat brigades in the force, the Army believes its overall combat 
capability will be increased as a result of the restructuring, 
providing added value to combatant commanders. Although somewhat 
smaller in size, the new modular combat brigades are expected to be as 
capable as the Army's existing brigades because they will have 
different equipment, such as advanced communications and surveillance 
equipment, and a different mix of personnel and support assets. The 
Army's organizational designs for the modular brigades have been tested 
by its Training and Doctrine Command's Analysis Center against a 
variety of scenarios, and the Army has found the new designs to be as 
capable as the existing division-based brigades in modeling and 
simulations. 

The Army's cost estimate for modularity through fiscal year 2011 is 
$52.5 billion as of April 2006. Of this $52.5 billion estimate, $41 
billion, or 78 percent, is planned to be spent on equipment for active 
and reserve units, with the remaining $11.5 billion allocated to 
military construction, facilities, sustainment, and training (see table 
3). In addition, Army leaders have recently stated they may seek 
additional funds after 2011 to procure more equipment for modular 
restructuring. 

Table 3: Modular Force Cost Estimates for the Entire Army by Function: 

Dollars in billions: 

Equipping; 
2005: $4.7; 
2006: $5.8; 
2007: $5.4; 
2008: $5.9; 
2009: $6.5; 
2010: $6.7; 
2011: $6.0; 
Total: $41.0; 
Percentage: 78. 

Military construction/facilities; 
2005: 0.3; 
2006: 0.0; 
2007: 0.5; 
2008: 0.5; 
2009: 1.5; 
2010: 1.5; 
2011: 1.5; 
Total: 5.8; 
Percentage: 11. 

Sustainment and training; 
2005: 0.0; 
2006: 0.7; 
2007: 0.7; 
2008: 1.2; 
2009: 1.1; 
2010: 1.0; 
2011: 1.0; 
Total: 5.7; 
Percentage: 11. 

Total; 
2005: $5.0; 
2006: $6.5; 
2007: $6.6; 
2008: $7.6; 
2009: $9.1; 
2010: $9.2; 
2011: $8.5; 
Total: $52.5; 
Percentage: 100. 

Source: GAO analysis of Army data. 

[End of table] 

Army Is Well Under Way in Its Modular Combat Brigade Conversions, but 
Its Ability to Meet Near-and Long-Term Equipping Goals Is Unclear: 

The Army has made progress in creating active component modular combat 
brigades, but it is not meeting its equipping goals for these brigades 
and has yet to complete the development of its rotational equipping 
strategy, which raises concerns about the extent to which brigades will 
be equipped in the near and longer term. Moreover, brigades will 
initially lack planned levels of key equipment, including items that 
provide enhanced intelligence, situational awareness, and network 
capabilities needed to help the Army achieve its objective of creating 
combat brigades that are able to operate on their own as part of a more 
mobile, rapidly deployable, joint, expeditionary force. In addition, 
because of existing equipment shortages, the Army National Guard will 
likely face even greater challenges providing the same types of 
equipment for its 28 planned modular combat brigades. To mitigate 
equipment shortages, the Army has developed a strategy to provide 
required levels of equipment to deploying active component and National 
Guard units, while allocating lesser levels of remaining equipment to 
other nondeploying units. However, the Army has not yet completed key 
details of this strategy, including determining the levels of equipment 
it needs to support this strategy, assessing the operational risk of 
not fully equipping all units, or providing to Congress information 
about these plans so it can assess the Army's current and long-term 
equipment requirements and funding plans. 

Army Faces Difficulty Meeting Its Goals for Equipping Active Modular 
Combat Brigades: 

The Army faces challenges meeting its equipping goals for its active 
modular combat brigades both in the near and longer term. As of 
February 2006, the Army had converted 19 modular combat brigades in the 
active force.[Footnote 9] According to the Army Campaign Plan, which 
established time frames and goals for the modular force conversions, 
each of these units is expected to have on hand at least 90 percent of 
its required major equipment items within 180 days after its new 
equipment requirements become effective.[Footnote 10] We reviewed data 
from several active brigades that had reached the effective date for 
their new equipment requirements by February 2006, and found that all 
of these brigades reported significant shortages of equipment 180 days 
after the effective date of their new equipment requirements, falling 
well below the equipment goals the Army established in its Campaign 
Plan. Additionally, the Army is having difficulty providing equipment 
to units undergoing their modular conversion in time for training prior 
to operational deployments, and deploying units often do not receive 
some of their equipment until after their arrival in theater. At the 
time of our visits, officials from three Army divisions undergoing 
modular conversion expressed concern over the lack of key equipment 
needed for training prior to deployment. 

The Army already faced equipment shortages before it began its modular 
force transformation and is wearing out significant quantities of 
equipment in Iraq, which could complicate plans for fully equipping new 
modular units. By creating modular combat brigades with standardized 
designs and equipment requirements, the Army believed that it could 
utilize more of its total force, thereby increasing the pool of 
available and ready forces to meet the demands of sustained rotations 
and better respond to an expected state of continuous operations. Also, 
by comparably equipping all of these units across the active component 
and National Guard, the Army further believes it will be able to 
discontinue its practice of allocating limited resources, including 
equipment, based on a system of tiered readiness,[Footnote 11] which 
resulted in lower priority units in both active and reserve components 
having significantly lower levels of equipment and readiness than the 
higher priority units. However, because of the need to establish a 
larger pool of available forces to meet the current high pace of 
operational commitments, the Army's modular combat brigade conversion 
schedule is outpacing the planned acquisition or funding for some 
equipment requirements. The Army has acknowledged that funding does not 
match its modular conversion schedule and that some units will face 
equipment shortages in the early years of transformation. According to 
Army officials, the Army may continue to seek funding to better equip 
its modular forces beyond 2011. 

For example, according to Army officials, funds programmed for the 
Army's tactical wheeled vehicle modernization strategy will not meet 
all of its requirements for light, medium, and heavy tactical vehicles 
and trucks through fiscal year 2011. In 2007, when 38 of 42 planned 
active component brigades are expected to complete their modular 
conversions, the Army expects to have only about 62 percent of the 
heavy trucks it needs to meet its requirements for these 
brigades.[Footnote 12] New higher requirements for trucks for the 
modular brigades added to an existing shortage of trucks in the Army's 
inventory. In addition, battle damage and losses along with higher- 
than-normal wear and tear on Army vehicles from current operations in 
Iraq and Afghanistan are contributing to this shortfall. While the Army 
plans to eventually fill these shortages through a combination of new 
procurement and modernization of its existing truck fleet, Army 
officials told us that the higher requirement for trucks is currently 
unaffordable within its near-term budget authority. Until the Army is 
able to meet its modular combat brigade design requirement for trucks, 
these brigades will not have their envisioned capability to conduct 
their own logistical support operations if necessary without requiring 
the augmentation of external combat and combat-service support forces. 

Equipment Shortages Include Key Items the Army Identified as Essential 
for Achieving Modular Force Capabilities: 

Active modular combat brigades will initially lack required numbers of 
some of the key equipment that Army force design analyses determined 
essential for achieving their planned capabilities. Two primary 
objectives underlying the Army's modular force designs and concepts are 
to (1) create more combat forces within the Army's current end strength 
that are as lethal as the division-based brigades they are replacing 
and (2) organize, staff, and equip these units to be more responsive, 
rapidly deployable, and better able to operate on their own compared to 
division-based brigades. Army force designers identified a number of 
key organizational, personnel, and equipment enablers they determined 
must be present for the modular combat brigades to be as lethal as the 
division-based brigades they are replacing. They include key battle 
command systems that are intended to provide modular combat brigades 
the latest command and control technology for improved situational 
awareness; advanced digital communications systems to provide secure 
high-speed communications links at the brigade level; and advanced 
sensors to provide modular combat brigades with their own intelligence- 
gathering, reconnaissance, and target-acquisition capabilities. 

We reviewed equipping plans for several command and control, 
communications, and reconnaissance systems to determine the Army's 
timelines for providing active modular combat brigades some of the key 
equipment they need to achieve their planned capabilities and function 
as designed. According to Army officials responsible for managing the 
distribution and fielding of equipment, the Army will not have all of 
this equipment on hand to meet the new modular force design 
requirements by 2007, when 38 of 42 active component modular combat 
brigades are to complete their modular conversions. These shortfalls 
are due to a range of reasons, but primarily because the modular 
conversion schedule is outpacing the planned acquisition or funding. 
For example, 

* The Army does not expect to meet until at least 2012 its modular 
combat brigade requirements for Long-Range Advanced Scout Surveillance 
Systems, an advanced visual sensor that provides long-range 
surveillance capability to detect, recognize, and identify distant 
targets. 

* The Army decided that it cannot meet design requirements within its 
current budget for Force XXI Battle Command Brigade and Below (FBCB2), 
a battle command component that provides real-time situational 
awareness information through identification and tracking of friendly 
forces to control battlefield maneuvers and operations. Moreover, 
because it has been in full production for less than 2 years, FBCB2 
production has not kept pace with the new higher modular force FBCB2 
requirements. As a result, the Army plans to provide active heavy and 
infantry brigades with less than half of their design requirement for 
FBCB2 through at least 2007. 

* The Army plans to meet only 85 percent of its requirements across the 
force for Single Channel Ground and Airborne Radio Systems, a command 
and control network radio system that provides voice and data 
communications capability in support of command and control operations, 
due to a funding decision. 

* The Army's design requirement for Shadow tactical unmanned aerial 
vehicle systems was to have one system composed of seven air vehicles 
per modular combat brigade, but because the Army lacks adequate numbers 
of air vehicle operators and maintainers, it decided to field the 
Shadow systems with four air vehicles instead. 

* The Army's schedule for the acquisition of Joint Network Node--a key 
communications system that provides secure high-speed computer network 
connection for data transmission down to the battalion level--could be 
delayed. According to Army officials, DOD recently decided to require 
the Army to have Joint Network Node undergo developmental and 
operational testing prior to further acquisition, which could delay 
equipping modular combat brigades. 

The systems discussed above are key to achieving the benefits Army 
officials expect to achieve with a modular force. For example, the Army 
decided to structure its new modular combat brigades with two maneuver 
battalions each instead of three battalions each, even though Army 
analysis showed that brigades with three maneuver battalions have 
several advantages and the Army's former division-based brigades have 
three battalions. The Army's decision to approve a brigade design with 
two maneuver battalions was made largely because of affordability 
concerns. However, the Army determined that brigades with two maneuver 
battalions could be as effective in combat as its division-based 
brigades provided they have the right mix of maneuver companies and 
enablers such as the systems discussed above. Until the Army is able to 
provide modular units with required quantities of these enablers, it is 
not clear whether the new brigades are as capable as the division-based 
brigades they are replacing. 

National Guard Faces Significant Equipping Challenges: 

In addition to the challenges the Army faces in providing active 
component modular combat brigades the equipment necessary for meeting 
expected capabilities, the Army will face greater challenges meeting 
its equipping requirements for its 28 planned National Guard combat 
brigades. The Army's modular force concept is intended to transform the 
National Guard from a strategic standby force to a force that is to be 
organized, staffed, and equipped comparable to active units for 
involvement in the full range of overseas operations. As such, National 
Guard combat units will enter into the Army's new force rotational 
model in which, according to the Army's plans, Guard units would be 
available for deployment 1 year out of 6 years. However, Guard units 
have previously been equipped at less than wartime readiness levels 
(often at 65 to 75 percent of requirements) under the assumption that 
there would be sufficient time for Guard forces to obtain additional 
equipment prior to deployment. Moreover, as of July 2005, the Army 
National Guard had transferred more than 101,000 pieces of equipment 
from nondeploying units to support Guard units' deployments overseas. 
As we noted in our 2005 report on National Guard equipment 
readiness,[Footnote 13] National Guard Bureau officials estimated that 
the Guard's nondeployed units had only about 34 percent of their 
essential warfighting equipment as of July 2005 and had exhausted 
inventories of 220 critical items. Although the Army says it will 
invest $21 billion into equipping and modernizing the Guard through 
2011, Guard units will start their modular conversions with less and 
much older equipment than most active units. This will add to the 
challenge the Army faces in achieving its plans and timelines for 
equipping Guard units at comparable levels to active units and fully 
meeting the equipping needs across both components. Moreover, the Army 
National Guard believes that even after the Army's planned investment, 
the Army National Guard will have to accept risk in certain equipment, 
such as tactical wheeled vehicles, aircraft, and force protection 
equipment. 

To Mitigate Equipment Shortages, Army Plans to Rotate Equipment among 
Units Based on Their Movement through Training, Readiness, and 
Deployment Phases: 

Because the Army realized that it would not have enough equipment in 
the near term to simultaneously equip modular combat brigades at 100 
percent of their requirements, the Army is developing a new equipping 
strategy as part of its force rotation model; however, this strategy is 
not yet completed because the Army has not finalized equipping 
requirements for this new strategy or assessed the operational risk of 
not fully equipping all units. Under the force rotation model, the Army 
plans to provide increasing amounts of equipment to units as they move 
through training phases and near readiness for potential deployment so 
they would be ready to respond quickly if needed with fully equipped 
forces. The Army believes that over time, equipping units in a 
rotational manner will enable it to better allocate available equipment 
and help manage risk associated with specific equipment shortages. 

Under this strategy, brigades will have three types of equipment sets-
-a baseline set, a training set, and a deployment set. The baseline set 
would vary by unit type and assigned mission and the equipment it 
includes could be significantly reduced from amounts the modular 
brigades are designed to have. Training sets would include more of the 
equipment units will need to be ready for deployment, but units would 
share the equipment that would be located at training sites throughout 
the country. The deployment set would include all equipment needed for 
deployment, including theater-specific equipment, high-priority items 
provided through operational needs statements, and equipment from Army 
prepositioned stock. With this rotational equipping approach, the Army 
believes it can have up to 14 active combat brigades and up to 5 Army 
National Guard combat brigades equipped and mission ready at any given 
time. 

While the Army has developed a general proposal to equip both active 
and Army National Guard units within the force rotation model, it has 
not yet fully developed specific equipment requirements, including the 
types and quantities of items, required in each phase of the model. As 
of March 2006, the Army was still developing proposals for what would 
be included in the three equipment sets as well as the specific 
equipping requirements for units. Figure 2 shows the Army's three-phase 
force rotation model. 

Figure 2: Army's Force Rotation Model: 

[See PDF for image] 

Source: GAO analysis of Army data. 

[A] The Army's force rotation model proposes that active component 
units in the Available phase will be available for deployment 1 year in 
every 3 years, and reserve component units will be available for 
deployment 1 year in every 6 years. 

[End of figure] 

The Reset/Train phase will include modular units that redeploy from 
long-term operations and are unable to sustain ready or available 
capability levels. The Ready phase will include those modular units 
that have been assessed as ready at designated capability levels, may 
be mobilized if required, and can be equipped if necessary to meet 
operational surge requirements. The Available phase will include those 
modular units that have been assessed as available at designated 
capability levels to conduct missions. In this last phase, active units 
are available for immediate deployment and reserve component units are 
available for mobilization, training, and validation for deployment. 
However, this strategy is not yet complete because the Army has not yet 
defined specific equipping requirements for units as they progress 
through the force rotation model. Therefore, it is difficult to assess 
the risk associated with decreasing nondeploying units' readiness to 
perform other missions or the ability of units in the Reset/Train and 
Ready phases of the force rotation model to respond to an unforeseen 
conflict or crisis, if required. 

Army Faces Challenges in Managing Active Component Personnel 
Requirements for Its New Modular Force Structure: 

The Army has made some progress toward meeting modular personnel 
requirements in the active component, but faces significant challenges 
in achieving its modular restructuring without permanently increasing 
its active component end strength above 482,400, as specified by the 
QDR. The Army plans to increase the size of its modular combat force 
but doing so without permanently increasing its overall end strength is 
an ambitious undertaking that will require the Army to eliminate or 
realign many positions in its noncombat force. While the Army is moving 
forward with its personnel reduction and realignment plans through a 
variety of initiatives, it is not clear to what extent the Army will be 
able to meet its overall end-strength goals and what risks to meeting 
modular force personnel requirements exist if these goals are not met. 
We have found that strategic workforce planning is one of the tools 
that can help agencies develop strategies for effectively implementing 
challenging initiatives. Effective strategic workforce planning 
includes the development of strategies to monitor and evaluate progress 
towards achieving goals. Without information on the status and progress 
of its personnel initiatives, Congress and the Secretary of Defense 
lack the data necessary to identify challenges, monitor progress, and 
effectively address problems when they arise. 

The Army accounts for its congressionally authorized active component 
personnel end strength in three broad categories--the operational 
combat force, the institutional noncombat force, and personnel who are 
temporarily unavailable for assignment. The operational combat force 
consists of personnel who are assigned to deployable combat, combat 
support, and combat service support units; these include modular combat 
brigades and their supporting units such as logistics, medical, and 
administrative units. The Army's institutional noncombat force consists 
of personnel assigned to support and training command and headquarters 
units, which primarily provide management, administrative, training, 
and other support, and typically are not deployed for combat 
operations. This includes personnel assigned to the Department of the 
Army headquarters and major commands such as the Training and Doctrine 
Command. In addition, the Army separately accounts for personnel who 
are temporarily unavailable for their official duties, including 
personnel who are in transit between assignments, are temporarily not 
available for assignment because of sickness or injury, or are students 
undergoing training away from their units. The Army refers to these 
personnel as transients, transfers, holdees, and students. 

The Army plans to reduce its current temporary end-strength 
authorization of 512,400[Footnote 14] to 482,400 by 2011 in order to 
help fund the Army's priority programs. Simultaneously, the Army plans 
to increase the number of soldiers in its operational combat force from 
its previous level of approximately 315,000 to 355,000 in order to meet 
the increased personnel requirements of its new larger modular force 
structure. The Army plans to utilize several initiatives to reduce and 
realign the Army with the aim of meeting these planned personnel 
levels. For example, the Army has converted some noncombat military 
positions into civilian positions, thereby freeing up soldiers to fill 
modular combat brigades' requirements. During fiscal year 2005, the 
Army converted approximately 8,000 military positions to civilian- 
staffed positions within the Army's noncombat force. However, Army 
officials believe additional conversions to achieve the 19,000 planned 
reductions in the noncombat force will be significantly more 
challenging to achieve. In addition to its success with the military- 
to-civilian conversions, the Army has been given statutory authority to 
reduce active personnel support to the National Guard and reserve by 
1,500.[Footnote 15] However, the Army must still eliminate additional 
positions, including reducing transients, transfers, holdees, and 
student personnel utilizing these and other initiatives, so it can 
reduce its overall end strength while filling requirements for modular 
units. As shown in table 4, the Army's goal is to reduce overall active 
component end strength from the current temporary authorization level 
while increasing the size of its operational combat force. 

Table 4: Army's End-strength Authorization History and Modular Force 
Goal: 

Operational combat force; 
End-strength authorizations (in thousands): Fiscal year 2000: 315.0; 
End-strength authorizations (in thousands): Current (temporary): 355.0; 
End-strength authorizations (in thousands): Modular force goal: 355.0. 

Noncombat force; 
End-strength authorizations (in thousands): Fiscal year 2000: 102.0; 
End-strength authorizations (in thousands): Current (temporary): 94.0; 
End-strength authorizations (in thousands): Modular force goal: 75.0. 

Other (transients, transfers, holdees, students); 
End-strength authorizations (in thousands): Fiscal year 2000: 63.0; 
End-strength authorizations (in thousands): Current (temporary): 63.4; 
End-strength authorizations (in thousands): Modular force goal: 52.4. 

Total; 
End-strength authorizations (in thousands): Fiscal year 2000: 480.0; 
End-strength authorizations (in thousands): Current (temporary): 512.4;
End-strength authorizations (in thousands): Modular force goal: 482.4. 

Source: GAO analysis of Army data. 

Note: End-strength authorizations account for the maximum numbers of 
positions available in which to assign personnel, but do not account 
for the numbers of personnel actually assigned to those positions. 

[End of table] 

While the Army is attempting to reduce end strength in its noncombat 
force and realign positions to the combat force via several 
initiatives, it may have difficulty meeting its expectations for some 
initiatives. For example, the Army expected that the Base Realignment 
and Closure (BRAC) decisions of 2005 could free up approximately 2,000 
to 3,000 positions in its noncombat force, but the Army is revisiting 
this assumption based upon updated manpower levels at the commands and 
installations approved for closure and consolidation. Army officials 
believe they will be able to realign some positions from BRAC, but it 
is not clear whether the reductions will free up 2,000 to 3,000 
military personnel that can be reassigned to modular combat units. In 
the same vein, Army officials expected to see reductions of several 
hundred base support staff resulting from restationing forces currently 
overseas back to garrisons within the United States. However, Army 
officials are still attempting to determine if the actual savings will 
meet the original assumptions. As a result, it is not clear to what 
extent the Army will be able to meet its overall end-strength goals and 
what risks exist if these goals are not met. 

Furthermore, the Army will face challenges in meeting its new modular 
force requirements for military intelligence specialists. The Army's 
new modular force structure significantly increases requirements for 
military intelligence specialists. In late 2005, Army intelligence 
officials told us that the modular force would require approximately 
8,400 additional active component intelligence specialist positions, 
but the Army planned to fill only about 57 percent of these positions 
by 2013, in part because of efforts to reduce overall end strength. In 
May 2006, Army officials told us that the Army had completed its most 
recent Total Army Analysis (for fiscal years 2008-2013), which balances 
Army requirements within a projected end-strength authorization of 
482,400. Accordingly, the Army revised its earlier estimate of 
intelligence specialist position requirements and determined that its 
increased active component requirement for intelligence specialists was 
only 5,600 and that it planned to fill all of these positions by 
2013.[Footnote 16] However, Army officials acknowledge that meeting 
modular force requirements for intelligence specialists is a 
significant challenge because it will take a number of years to recruit 
and train intelligence soldiers. 

According to Army intelligence officials, intelligence capability has 
improved over that of the previous force; however, any shortfalls in 
filling intelligence requirements would further stress intelligence 
specialists with a high pace of deployments. Since intelligence is 
considered a key enabler of the modular design--a component of the new 
design's improved situational awareness--it is unclear to what extent 
any shortages in planned intelligence capacity will affect the overall 
capability of modular combat brigades. Without continued, significant 
progress in meeting personnel requirements, the Army may need to accept 
increased risk in its ability to conduct operations and support its 
combat forces or it may need to seek support for an end-strength 
increase from DOD and Congress. 

Army Has Overall Objectives and Time Frames for Modularity, but Lacks a 
Long-Term Comprehensive Approach to Assess Progress and Monitor 
Implementation: 

While the Army has established overall objectives and time frames for 
modularity, it lacks a long-term comprehensive and transparent approach 
to effectively measure its progress against stated modularity 
objectives, assess the need for further changes to its modular unit 
designs, and monitor implementation plans. A comprehensive approach 
includes performance measures and a plan to test changes to the design 
of the modular combat brigades. The Army has not developed a 
comprehensive approach because senior leadership has focused attention 
on developing broad guidance and unit conversion plans for modularity 
while focusing less attention on developing ways to measure results. 
Without such an approach, neither the Secretary of Defense nor Congress 
will have full visibility into the capabilities of the modular force 
and the Army's implementation plans. 

Army Lacks Performance Metrics to Measure the Results of Modularity: 

While the Army has identified objectives for modularity, it has not 
developed modular-specific quantifiable goals or performance metrics to 
measure its progress. GAO and DOD, among others, have identified the 
importance of establishing objectives that can be translated into 
measurable, results-oriented metrics, which in turn provide 
accountability for results. In a 2003 report we found that the adoption 
of a results-oriented framework that clearly establishes performance 
goals and measures progress toward those goals was a key practice for 
implementing a successful transformation.[Footnote 17] DOD has also 
recognized the need to develop or refine metrics so it can measure 
efforts to implement the defense strategy and provide useful 
information to senior leadership. 

The Army considers the Army Campaign Plan to be a key document guiding 
the modular restructuring. The plan provides broad guidelines for 
modularity and other program tasks across the entire Army. However, 
modularity-related metrics within the plan are limited to a schedule 
for creating modular units and an associated metric of achieving unit 
readiness goals for equipment, training, and personnel by certain dates 
after unit creation. Moreover, a 2005 assessment by the Office of 
Management and Budget identified the total number of brigades created 
as the only metric the Army had developed for measuring the success of 
its modularity initiative. Another key planning document, the 2005 Army 
Strategic Planning Guidance, identified several major expected 
advantages of modularity, including an increase in the combat power of 
the active component force by at least 30 percent, an increase in the 
rotational pool of ready units by at least 50 percent, the creation of 
a deployable joint-capable headquarters, the development of a force 
design upon which the future network-centric developments can be 
readily applied, and reduced stress on the force through a more 
predictable deployment cycle. However, these goals have not translated 
into outcome-related metrics that are reported to provide decision 
makers a clear status of the modular restructuring as a whole. Army 
officials stated that unit-creation schedules and readiness levels are 
the best available metrics for assessing modularity progress because 
modularity is a reorganization encompassing hundreds of individual 
procurement programs that would be difficult to collectively assess in 
a modularity context. However, we believe that results-oriented 
performance measures with specific, objective indicators used to 
measure progress toward achieving goals are essential for restructuring 
organizations. 

A major Air Force transformation initiative may provide insights on how 
the Army could develop performance metrics for a widespread 
transformation of a military force. In 1998, the Air Force adopted the 
Expeditionary Aerospace Force Concept as a way to help manage its 
deployments and commitments to theater commanders and reduce the 
deployment burden on its people. Like the Army's modular restructuring, 
the Air Force's restructuring was fundamental to the force, and 
according to the Air Force, represented the largest transformation of 
its processes since before the Cold War. In our 2000 report,[Footnote 
18] we found that the Air Force expected to achieve important benefits 
from the Expeditionary Concept, but had yet to establish specific 
quantifiable goals for those benefits, which included increasing the 
level of deployment predictability for individual service members. We 
recommended that the Air Force develop specific quantifiable goals 
based on the Expeditionary Concept's broad objectives, and establish 
needed metrics to measure progress toward these goals. In a January 
2001 report to Congress on the Expeditionary Aerospace Force 
Implementation, the Air Force identified 13 metrics to measure progress 
in six performance areas. For example, to better balance deployment 
taskings in order to provide relief to heavily tasked units, the Air 
Force developed 4 metrics, including one that measures active duty 
personnel available to meet Expeditionary Force requirements. The Air 
Force described each metric and assigned either a quantitative goal 
(such as a percentage) or a trend goal indicating the desired direction 
the metric should be moving over time. These results were briefed 
regularly to the Air Force Chief of Staff. The Army's transformation is 
more extensive than the Air Force's in that the Air Force did not 
change traditional command and organizational structures under its 
Expeditionary Concept, while the Army modular force has made extensive 
changes to these structures, and the Air Force did not plan for nearly 
the same implementation costs as the Army. Nonetheless, we believe some 
of the goals and challenges faced by the Air Force that we reported in 
August 2000 may have relevance to the Army today. 

While we recognize the complexity of the Army's modular restructuring, 
without clear definitions of metrics, and periodic communication of 
performance against these metrics, the Secretary of Defense and 
Congress will have difficulty assessing the impact of refinements and 
enhancements to the modular design--such as DOD's recent decision to 
reduce the number of modular combat and support brigades reported in 
the QDR, as well as any changes in resources available to meet modular 
design requirements. 

Army Lacks a Plan for Comprehensively Evaluating Modular Designs: 

Since 2004, when the Army approved the original designs for its modular 
brigades, it has made some refinements to those designs but does not 
have a comprehensive plan for evaluating the effect of these design 
changes or the need for additional design changes as the Army gets more 
operational experience using modular brigades and integrating command 
and control headquarters, combat support units, and combat brigades. In 
fiscal year 2004, TRADOC's Analysis Center concluded that the modular 
combat brigade designs would be more capable than division-based units 
based on an integrated and iterative analysis employing computer- 
assisted exercises, subject matter experts, and senior observers. This 
analysis culminated in the approval of modular brigade-based designs 
for the Army. The assessment employed performance metrics such as 
mission accomplishment, units' organic lethality, and survivability, 
and compared the performance of variations on modular unit designs 
against the existing division-based designs. The report emphasized that 
the Chief of Staff of the Army had asked for "good enough" prototype 
designs that could be quickly implemented, and the modular 
organizations assessed were not the end of the development effort. 

Since these initial design assessments, the Army has been assessing 
implementation and making further adjustments in designs and 
implementation plans through a number of venues, to include: 

* unit readiness reporting on personnel, equipment, and training; 

* modular force coordination cells to assist units in the conversion 
process; 

* modular force observation teams to collect lessons during training; 
and: 

* collection and analysis teams to assess units' effectiveness during 
deployment. 

Based on data collected and analyzed through these processes, TRADOC 
has approved some design change recommendations and has not approved 
others. For example, TRADOC analyzed a Department of the Army proposal 
to reduce the number of Long-Range Advanced Scout Surveillance Systems, 
but recommended retaining the higher number in the existing design in 
part because of decreases in units' assessed lethality and 
survivability with the reduced number of surveillance systems. 

Army officials maintain that ongoing assessments described above 
provide sufficient validation that the modularity concept works in 
practice. However, these assessments do not provide a comprehensive 
evaluation of the modular designs. Further, the Army does not plan to 
conduct a similar overarching analysis to assess the modular force 
capabilities to perform operations across the full spectrum of 
potential conflict. In November 2005, we reported that methodically 
testing, exercising, and evaluating new doctrines and concepts is an 
important and established practice throughout the military, and that 
particularly large and complex issues may require long-term testing and 
evaluation that is guided by study plans.[Footnote 19] We believe the 
evolving nature of the design highlights the importance of planning for 
broad-based evaluations of the modular force to ensure the Army is 
achieving the capabilities it intended, and to provide an opportunity 
to make course corrections if needed. For example, one controversial 
element of the design was the decision to include two maneuver 
battalions instead of three in the modular combat brigades. TRADOC's 
2004 analysis noted that the modular combat brigade designs with the 
two maneuver battalion organization did not perform as well as the 
three maneuver battalion design, and cited this as one of the most 
significant areas of risk in the modular combat brigade design. 
Nonetheless, because of the significant additional cost of adding a 
third combat battalion the Army decided on a two-battalion design for 
the modular combat brigades that included key enabling equipment such 
as communications, and surveillance and reconnaissance capabilities. 
Some defense experts, including a current division commander and 
several retired Army generals, have expressed concerns about this 
aspect of the modular design. In addition, some of these experts have 
expressed concerns about whether the current designs have been 
sufficiently tested and whether they provide the best mix of 
capabilities to conduct full-spectrum operations. In addition, the Army 
has recently completed designs for support units and headquarters 
units. Once the Army gets more operational experience with the new 
modular units, it may find it needs to make further adjustments to its 
designs. Without a comprehensive testing plan, neither the Army nor 
congressional decision makers will be able to sufficiently assess the 
capabilities of the modular combat brigades as they are being 
organized, staffed, and equipped. 

Conclusions: 

The fast pace, broad scope, and cost of the Army's effort to transform 
into a modular force present considerable challenges for the Army, and 
for Congress as well in effectively overseeing a force restructuring of 
this magnitude. The Army leadership has dedicated considerable 
attention, energy, and time to achieving its modularity goals under 
tight time frames. However, the lack of clarity in equipment and 
personnel plans raises considerable uncertainty as to whether the Army 
can meet its goals within acceptable risk levels. For example, until 
the Army defines and communicates equipment requirements for all 
modular units and assesses the risk associated with its plan to not 
equip brigades with all of their intended capabilities, it will remain 
unclear the extent to which its new modular combat brigades will be 
able to operate as stand-alone, self-sufficient units--a main goal of 
the Army's modular transformation. With respect to personnel, the 
Army's goal to increase its operational force while not permanently 
increasing its current end strength will require it to make the most 
efficient use of its personnel. Until the Army communicates the status 
of its various ongoing personnel initiatives, the Army's ability to 
meet personnel requirements of its new modular force will also remain 
unclear. Finally, until the Army develops a long-term comprehensive 
approach for measuring progress and a plan for evaluating changes, it 
remains uncertain how the Army will determine whether it is achieving 
its goal of creating a more rapidly deployable, joint, expeditionary 
force. Without such an approach, and clearly defined and communicated 
plans, the Secretary of Defense and Congress will not have the 
information needed to weigh competing funding priorities and monitor 
the Army's progress in its over $52 billion effort to transform its 
force. 

Recommendations for Executive Actions: 

We recommend that the Secretary of Defense direct the Secretary of the 
Army to take the following actions. 

First, in order for decision makers to better assess the Army's 
strategy for equipping modular combat brigades, we recommend the Army 
develop and provide the Secretary of Defense and Congress with: 

* details about the Army's equipping strategy, to include the types and 
quantities of equipment active component and National Guard modular 
units would receive in each phase of the force rotation model, and how 
these amounts compare to design requirements for modular units; and: 

* an assessment of the operational risk associated with this equipping 
strategy. 

Second, in order for decision makers to have the visibility needed to 
assess the Army's ability to meet the personnel requirements for its 
new modular operational forces while simultaneously managing the risk 
to its noncombat forces, we recommend that the Army develop and provide 
the Secretary of Defense and Congress with: 

* a report on the status of its personnel initiatives, including 
executable milestones for realigning and reducing its noncombat forces; 
and: 

* an assessment of how the Army will fully staff its modular 
operational combat force while managing the risk to its noncombat 
supporting force structure. 

Third, to improve information available for decision makers on progress 
of the Army's modular force implementation plans, we recommend that the 
Army develop and provide the Secretary of Defense and Congress with a 
comprehensive plan for assessing the Army's progress toward achieving 
the benefits of modularity to include: 

* specific, quantifiable performance metrics to measure progress toward 
meeting the goals and objectives established in the Army Campaign Plan; 
and: 

* plans and milestones for conducting further evaluation of modular 
unit designs that discuss the extent to which unit designs provide 
sufficient capabilities needed to execute National Defense Strategy and 
2006 QDR objectives for addressing a wider range of both traditional 
and irregular security challenges. 

Finally, the Secretary of the Army should provide a testing plan as 
part of its Army Campaign Plan that includes milestones for conducting 
comprehensive assessments of the modular force as it is being 
implemented so that decision makers---both inside and outside the Army-
--can assess the implications of changes to the Army force structure in 
terms of the goals of modular restructuring. The results of these 
assessments should be provided to Congress as part of the Army's 
justification for its annual budget through fiscal year 2011. 

Matter for Congressional Consideration: 

Given the significant cost and far-reaching magnitude of the Army's 
plans for creating modular forces, Congress should consider requiring 
the Secretary of Defense to provide the information outlined in our 
recommendations including; 

* details about the Army's equipping strategy and an assessment of the 
operational risk associated with this equipping strategy; 

* the status of the Army's personnel initiatives and an assessment of 
how the Army will fully staff its modular operational combat force and 
manage the risk to its noncombat force structure; and: 

* the Army's plan for assessing its progress toward achieving the 
benefits of modularity, plans and milestones for conducting further 
evaluation of modular unit designs, and a testing plan for conducting 
comprehensive assessments of the modular force as it is being 
implemented. 

Agency Comments and Our Evaluation: 

In written comments on a draft of this report provided by the Army on 
behalf of DOD, the department noted that the report adequately reflects 
the challenges associated with transforming the Army to modular force 
designs while at war, but stated that the report fails to recognize 
ongoing efforts and accomplishments to date. (DOD's comments are 
reprinted in app. II). DOD also stated that citing the views of unnamed 
sources regarding the modular combat brigade design does not contribute 
to an accurate, balanced assessment of the Army's progress. DOD agreed 
or partially agreed with our recommendations to develop and provide 
information on its equipping strategy and personnel initiatives and to 
develop expanded performance metrics for assessing progress. However, 
DOD disagreed with three recommendations regarding the need for risk 
assessments and a testing plan to further assess designs for modular 
units. As discussed below, because of the significance, cost, scope, 
and potential for risk associated with the Army's modularity 
initiative, we continue to believe that more transparency of the Army's 
plans and risk assessments is needed in light of the limited amount of 
information the Army has provided to Congress. Therefore, we have 
included a matter for congressional consideration to require the 
Secretary of Defense to provide more detailed plans and assessments of 
modularity risks. Our specific comments follow. 

First, we strongly disagree with DOD's assertion that GAO used 
anonymous and unverifiable sources which detracted from an accurate and 
balanced assessment of the Army's progress in implementing modularity. 
Our analysis of the Army's progress and potential for risk in 
implementing modular units is primarily based on our independent and 
thorough analysis of Army plans, reports, briefings, and readiness 
assessments, which we used to compare the Army's goals for modularity 
against its actual plans for equipping and staffing modular units. We 
sought views on modular unit designs to supplement our analysis from a 
diverse group of knowledgeable people both inside and outside the Army 
and DOD, including Army headquarters officials, division and brigade 
commanders, Army officials who played key roles in developing and 
assessing modular unit designs, and retired generals and defense 
experts who have studied and written about Army transformation. Our 
long-standing policy is not to include the names of individuals from 
whom we obtained information but to use information and evidence from 
appropriate and relevant sources and provide balance in our report. We 
integrated evidence and information from all sources to reach 
conclusions and formulate the recommendations included in this report. 
Our report recognizes the Army's progress in implementing modular units 
while fully engaged in ongoing operations but also identifies and 
provides transparency regarding a number of risks inherent in the 
Army's plans so that Congress will have better information with which 
to make decisions on funding and oversight. The discussion we present 
highlighting the concerns of some current and retired senior Army 
officers and defense experts regarding certain aspects of modular 
designs is used to illustrate the need for further evaluation of 
modular units as they move from concept to reality--an approach 
consistent with DOD policy and best practice in transforming defense 
capabilities. 

DOD also stated that the report inaccurately (1) asserts that Shadow 
tactical unmanned aerial vehicle systems will be fielded with fewer air 
vehicles due to a shortage of operators and maintainers, and (2) 
depicts the growth of Army Intelligence positions. We disagree with 
DOD's assessment. As our report clearly points out, based on 
documentation obtained from the Army, the Army's approved modular 
combat brigade design was for seven air vehicles per Shadow system, 
which would provide 24-hour per day aerial surveillance, but the Army 
opted to field Shadow systems with four air vehicles instead, primarily 
because it lacks adequate numbers of air vehicle operators and 
maintainers. Although the Army believes that Shadow systems with four 
air vehicles are adequate at this time, we believe it is important to 
provide transparency by presenting information which shows that modular 
combat brigades will not have all of the capabilities intended by the 
original modular combat brigade designs (i.e., brigade-level 24-hour 
per day surveillance operations) without Shadow systems composed of 
seven air vehicles. 

With regard to the number of intelligence positions, our report 
accurately notes that the Army decided to increase its intelligence 
positions by 5,600 in the active force. However, we also note that this 
was a revision of an earlier higher estimate of 8,400 positions 
projected by Army intelligence officials. Therefore, we do not agree 
with the department's comment that the report inaccurately depicts the 
growth of Army intelligence positions, nor do we agree with its 
characterization that the report inappropriately focuses on the Army's 
manning challenges. We believe that it is important for the Secretary 
of Defense and Congress to have a clear and transparent picture of the 
personnel challenges the Army faces in order to fully achieve the goals 
of modular restructuring and make informed decisions on resources and 
authorized end strength. 

DOD agreed with our recommendation that the Army develop and provide 
the Secretary of Defense and Congress with details about the Army's 
equipping strategy. DOD commented that the Army recently completed 
development of the equipping strategy for modular forces and that the 
Army has conducted equipping conferences to ensure that soldiers have 
the best equipment available as they train and deploy. We requested a 
copy of the Army's recently completed equipping strategy but did not 
receive a copy prior to publication and therefore have not been able to 
assess how and to what extent it meets the intent of our 
recommendation. Moreover, DOD did not indicate what, if any, actions it 
planned to take to provide Congress with specific details about the 
Army's equipping strategy, as we recommended. Therefore, we have 
highlighted the need for more complete information on the Army's 
equipping strategy in a matter for congressional consideration. 

DOD disagreed with our recommendation that the Army develop and provide 
the Secretary of Defense and Congress with an assessment of the risk 
associated with the Army's rotational equipping strategy and said in 
its comments that this action is already occurring on a regular basis. 
Although the Army is considering risk in managing existing equipment, 
at the time of our review the Army had not finished developing its 
equipping strategy for its new rotational force model. Therefore, we 
continue to believe that the Army needs to document and provide risk 
assessments to Congress based on its newly completed equipping 
strategy. This is particularly important given other Army priorities 
such as the Future Combat System and near-term equipping needs for Iraq 
that will compete for funding and may cause changes to the Army's 
current equipping strategy for modular units. 

DOD partially concurred with our recommendation that the Army develop 
and provide the Secretary of Defense and Congress with a report on the 
status of its personnel initiatives. However, DOD commented that adding 
another report on this issue would be duplicative and irrelevant and 
said this action is already occurring on a regular basis. However, 
while Army documents present an overview of how the Army is allocating 
military personnel to operational and nonoperational positions, they do 
not provide specific information on the Army's progress in implementing 
personnel initiatives. Moreover, the department's comments did not 
address whether the Army plans to provide additional information to 
Congress. We continue to believe that such information is needed by 
Congress to inform their decisions on Army personnel levels. 

DOD disagreed with our recommendation that the Army develop and provide 
the Secretary of Defense and Congress with a risk assessment of how the 
Army will fully staff its modular operational combat force while 
managing the risk to its noncombat supporting force structure. DOD 
commented that the Army provided the Office of the Secretary of Defense 
with a plan for reshaping the Army, including increasing the active 
operating force and downsizing overall active end strength by fiscal 
year 2011, based on several assumptions. However, this document, which 
Army officials provided to us, does not highlight potential risks in 
executing the Army's plan. Moreover, DOD's comments did not address the 
intent of our recommendation that the Army improve transparency by 
providing Congress with additional information on its plans and 
assessment of risk. 

DOD partially agreed with our recommendation that the Army develop and 
provide the Secretary of Defense and Congress with a comprehensive plan 
for assessing the Army's progress toward achieving modularity goals and 
said the Army will explore the development of expanded performance 
metrics. However, DOD stated that plans and milestones for measuring 
progress are unwarranted as such evaluations occur continuously. We 
commend DOD for agreeing to develop expanded performance metrics. 
However, because of the cost and magnitude of the Army's transformation 
plans, we continue to believe that developing and disseminating a 
comprehensive and formal evaluation plan are critical for providing 
transparency and accountability for results. As discussed in the 
report, the Army is collecting some data on the performance of modular 
units that attend training events and deploy overseas, but lacks a long-
term comprehensive and transparent approach for integrating the results 
of these assessments to measure overall progress. 

Finally, DOD disagreed with our recommendation that the Secretary of 
Defense direct the Secretary of the Army to provide a testing plan that 
includes milestones for assessing modular unit designs as they are 
being implemented. DOD said the Army thoroughly evaluated modular force 
designs and continues to evaluate all facets of modular force 
performance both in training and combat operations. Nevertheless, we 
believe that the Army needs a more transparent, long-term, and 
comprehensive plan for evaluating the modular designs. The Army is 
still early in its implementation of modular support brigades and 
higher echelon command and control and support units and further 
evaluation of these designs based on actual experience may demonstrate 
that design refinements are needed. Furthermore, although the Army has 
gained some useful operational experience with modular combat units, 
this experience has been limited to stability operations and irregular 
warfare, rather than major combat operations or other operations across 
the full spectrum of potential conflict. To facilitate further 
assessment of unit designs, we have included this issue in our matter 
for congressional consideration. 

We are sending copies of this report to the Secretary of Defense, the 
Undersecretary of Defense (Comptroller), and the Secretary of the Army. 
We will also make copies available to others upon request. In addition, 
this report will be available at no charge on the GAO Web site at 
[Hyperlink, http://www.gao.gov]. 

If you have any questions about this report, please contact me at (202) 
512-4402. Contact points for our Offices of Congressional Relations and 
Public Affairs may be found on the last page of this report. Major 
contributors to this report are listed in appendix III. 

Signed by: 

Janet A. St. Laurent: 
Director, Defense Capabilities and Management: 

List of Committees: 

The Honorable John Warner: 
Chairman: 
The Honorable Carl Levin: 
Ranking Minority Member: 
Committee on Armed Services: 
United States Senate: 

The Honorable Ted Stevens: 
Chairman: 
The Honorable Daniel K. Inouye: 
Ranking Minority Member: 
Subcommittee on Defense: 
Committee on Appropriations: 
United States Senate: 

The Honorable Duncan L. Hunter: 
Chairman: 
The Honorable Ike Skelton: 
Ranking Minority Member: 
Committee on Armed Services: 
House of Representatives: 

The Honorable C. W. Bill Young: 
Chairman: 
The Honorable John P. Murtha: 
Ranking Minority Member: 
Subcommittee on Defense: 
Committee on Appropriations: 
House of Representatives: 

[End of section] 

Appendix I: Scope and Methodology: 

To conduct our work for this engagement, we analyzed data, obtained and 
reviewed documentation, and interviewed officials from Headquarters, 
Department of Army; U.S. Army Training and Doctrine Command, U.S. Army 
Forces Command; and the U.S. Army Center for Army Analysis. We 
supplemented this information with visits to the first three Army 
divisions undergoing modular conversions---the 3rd and 4th Infantry 
Divisions and the 101st Airborne Division--to gain an understanding of 
the Army's modular force implementation plans and progress in 
organizing, staffing, and equipping active modular combat brigades. 

To determine the Army's modular force organizational design 
requirements and supporting analysis, we analyzed Department of the 
Army guidance for creating modular forces, and briefings and other 
documents on the Army's modular force design and analytical process 
from the Training and Doctrine Command's Analysis Center. To determine 
the Army's progress and plans for equipping active component modular 
combat brigades, we analyzed Department of Army data on selected 
equipment that Army analysis identified as essential for achieving the 
modular combat brigades' intended capabilities. For these selected 
items, we calculated the Army's equipment requirements for active 
component modular combat brigades by multiplying equipment requirements 
obtained from the Department of the Army Office of the Deputy Chief of 
Staff for Operations and Training (G-3) for each of the three brigade 
variants--heavy, light, and Stryker--by the planned number of brigades 
in each variant. We then compared the sum of equipment requirements in 
the active component to data we obtained from officials from the 
Department of the Army G-8 on the expected on-hand levels of equipment 
and assessed the reliability of the data by discussing the results with 
knowledgeable officials. We determined that the data used were 
sufficiently reliable for our objectives. We also reviewed unit 
readiness reports from those brigades that had completed or were in the 
process of completing their modular conversion as of February 2006. For 
our assessment of Army National Guard equipping challenges, we relied 
on past GAO reports and testimony. 

To determine the progress made and challenges to managing personnel 
requirements of the modular force, we reviewed documents and discussed 
the implications of force structure requirements with officials from 
the Department of Army Offices of the Deputy Chiefs of Staff for 
Personnel (G1) and Intelligence (G2). We also discussed key personnel- 
related concerns during our visits to the divisions undergoing modular 
conversion. To determine the Army's strategies and plans for meeting 
its modular force personnel requirements without permanently increasing 
overall end strength, we interviewed officials from the Office of the 
Assistant Secretary of the Army for Manpower and Reserve Affairs and 
the Department of the Army Office of the Deputy Chief of Staff for 
Operations and Training (G3). We also reviewed the 2006 Quadrennial 
Defense Review as it pertained to Army personnel end strength, and the 
Army's Future Year Defense Program and supplemental budget requests for 
fiscal years 2005 and 2006 to determine the Army's personnel funding 
plans. 

To determine the extent to which the Army has developed an approach for 
assessing implementation of modularity and for further adjusting 
designs or implementation plans, we reviewed our prior work on 
assessing organizations undertaking significant reorganizations. We 
reviewed and analyzed the Army Campaign Plan and discussed it with 
officials in the Department of Army Headquarters, especially officials 
from the Deputy Chief of Staff for Operations and Training (G3). To 
analyze the Army's approach for assessing the implementation of its 
modular conversion, we examined key Army planning documents and 
discussed objectives, performance metrics, and testing plans with 
appropriate officials in the Department of the Army Headquarters, and 
the Training and Doctrine Command's Analysis Center. In addition, we 
met with a panel of retired senior Army general officers at the 
Association of the U.S. Army Institute of Land Warfare, Arlington, 
Virginia. We relied on past GAO reports assessing organizations 
undertaking significant reorganizations. 

We conducted our work from September 2004 through March 2006 in 
accordance with generally accepted government auditing standards. 

[End of section] 

Appendix II: Comments from the Department of Defense: 

Department Of The Army: 
Office Of The Deputy Chief Of Staff, G-8: 
780 Army Pentagon: 
Washington DC 20310-0700: 

June 30, 2006: 

Ms. Janet St. Laurent: 
Director, Defense Capabilities and Management: 
U.S. Government Accountability Office: 
441 G Street, N.W. Washington, DC 20548: 

Dear Ms. St. Laurent: 

This is the Department of Defense (DOD) response to the GAO draft 
report, 'Force Structure: Army Needs to Provide DOD and Congress More 
Visibility Regarding Modular Force Capabilities and Implementation 
Plans,' dated June 2, 2006 (GAO Code 350707/GAO-06-745). 

While the report adequately reflects the challenges associated with 
transforming the Army to modular force designs while at war and with 
limited funding, we believe the report fails to recognize ongoing 
efforts and accomplishments to date. Additionally, the use of anonymous 
and unverifiable sources throughout the report (e.g., "Some defense 
experts, including a current division commander and several retired 
Army generals, have expressed concerns about this aspect of the modular 
design.") does not contribute to an accurate, balanced assessment and 
should be discouraged. 

The Department's comments to the draft report and recommendations are 
enclosed. 

Sincerely, 

Signed by: 

N. Ross Thompson III: 
Major General, U.S. Army: 
Director, Program Analysis and Evaluation: 

Enclosure: 

GAO Draft Report - Dated June 2, 2006 GAO Code 350707/GAO-06-745: 

"Force Structure: Army Needs to Provide DoD and Congress More 
Visibility Regarding Modular Force Capabilities and Implementation 
Plans" 

Department of Defense Comments and Comments to GAO Recommendations: 

Comments: 

Transforming the Army to modular force designs remains a high priority 
for the Department of Defense. The GAO report recognizes the 
unprecedented challenges associated with this comprehensive and 
accelerated redesign of an Army that is at war. The report also notes 
that the Army entered this long war against global terrorism following 
a decade of inadequate equipping investments, resulting in widespread 
equipment shortages across the Army, especially in its reserve forces. 
It will take at least a decade of robust, continuous modernization 
investments to fully equip all Army forces. 

To better manage the manning, equipping, and training of modular forces 
for the long war, the Army has developed a rotational readiness model, 
referred to as Army Force Generation (ARFORGEN). The Army's force 
structure goal is 70 brigade combat teams and 211 support brigades, 
each fully manned, equipped, and trained for the missions assigned. 
Given longstanding equipment shortages, the Army 'maneuvers' equipment 
across the force to Soldiers and units as they progress through the 
various phases of ARFORGEN. To ensure National Guard forces are always 
prepared for state and territorial responsibilities, the Army has 
identified 342 types of equipment for priority fielding to National 
Guard units. The Army has also concentrated equipment in combat zones 
to reduce the costs associated with transporting heavy equipment to/ 
from the theater and to ensure that deployed forces have the best 
equipment available. While percentages of equipment fill across the 
Army may be less than 100 percent, deployed forces have what they need 
to accomplish their mission. Additionally, theater-unique items, such 
as jammers for improvised explosive devices (IEDs) and armored wheeled 
vehicles, are concentrated almost exclusively in the combat zone and 
are passed between rotating units. The Department believes that the GAO 
report unnecessarily focuses on longstanding equipment shortages, vice 
the significant progress being made to equip forces according to the 
new modular designs. 

The Army regularly and rigorously assesses its responsibilities 
associated with providing the most appropriate mix of capabilities to 
the warfighter within available resources. As with any complex and 
dynamic undertaking, objectives, priorities, and approaches continue to 
be refined over time. This is a simple reflection of the continuous 
process within a Service to provide relevant capabilities within the 
resources provided. Specifically, the GAO report asserts that Shadow 
tactical unmanned aerial vehicle systems will be fielded with less than 
their full complement of air vehicles (i.e., four vice seven) due to a 
shortage of operators and maintainers. This is inaccurate. Informed by 
operational analysis and professional judgment, the Army determined 
that four air vehicles per Shadow system are adequate at this time. 
Shadow units will be fully manned, equipped, and trained. The GAO 
report also inaccurately depicts the growth of Army intelligence 
positions. Informed by the Total Army Analysis for fiscal years 2008- 
2013, the Army decided to increase its intelligence positions by 7600 
positions: 5600 in the active force and 2000 in the reserve force. 
Recruiting and training the personnel to fill the additional 7600 
intelligence positions will be a challenge, as noted in the GAO report, 
but so is the entire Army modular transformation while at war. The 
Department believes this GAO report inappropriately focuses on the 
Army's manning challenges, vice provide a balanced assessment of 
significant change underway. 

Department of Defense Comments to GAO Recommendations: 

Recommendation 1: The GAO recommended that the Secretary of the Army 
develop and provide the Secretary of Defense and Congress with details 
about the Army's equipping strategy, to including the types and 
quantities of equipment active component and National Guard modular 
units would receive in each phase of its force rotation model, and how 
these amounts compare to design requirements for modular units. (p. 25/ 
GAO Draft Report): 

DOD Response: Concur. The Army recently completed development and 
coordination of the equipping strategy for modular forces, consistent 
with the Army Force Generation (ARFORGEN) model. To maximize use of 
constrained resources, the Army conducts global equipping conferences 
biannually. To date, the Army has conducted six equipping conferences 
with representatives from all Army components - Regular Army, Army 
National Guard, and U.S. Army Reserve --to ensure that combatant 
commanders' needs are addressed and that all Soldiers and units have 
the very best equipment available as they train and deploy in support 
of the global war on terrorism or domestic contingencies. 

Recommendation 2: The GAO recommended that the Secretary of the Army 
develop and provide the Secretary of Defense and Congress with an 
assessment of the operational risk associated with this equipping 
strategy. (p. 25/GAO Draft Report): 

DOD Response: Nonconcur. This action is already occurring on a regular 
basis. Assessment of risk (operational, institutional, future, and 
force management) is an integral part of the Department's management 
oversight of Defense initiatives, including Army modular 
transformation. Adding another report on this issue would be 
duplicative and irrelevant. As the report noted, the Army entered the 
current long war against global terrorism with a significant equipment 
shortfall ($56 billion), following a decade of inadequate investment in 
modem equipment. As a result, the Army is maneuvering equipment across 
the force to ensure units are adequately equipped as they train for a 
pending deployment. Once in theater, the unit is augmented with theater-
provided equipment (TPE), which consists of low density, high demand, 
modem equipment. The strategy of equipment maneuver and the use of TPE 
amplifies that the Amy's current equipment inventory is inadequate to 
fully equip all units. The Army is on a path to fully equip all units 
regardless of Component. However, sustained, robust procurement funding 
is necessary to fill longstanding shortages, fully equip reserve 
component forces to effectively operate as part of the operational 
force, address expanded equipment needs of modular force designs, and 
account for increased wear and tear and baffle losses from the ongoing 
global war on terrorism. The Army equipping strategy is designed to 
ensure that Soldiers and units deployed in harm's way have the best 
equipment the Nation can provide. 

Recommendation 3: The GAO recommended that the Secretary of the Army 
develop and provide the Secretary of Defense and Congress with a report 
on the status of its personnel initiatives, including executable 
milestones for realigning and reducing its noncombat forces. (p. 25-26/ 
GAO Draft Report): 

DOD Response: Partially concur. This action is already occurring on a 
regular basis. The Army Deputy Chief of Staff, G-1, reports quarterly 
to the Under Secretary of Defense for Personnel and Readiness on Army 
progress in reshaping the force, including the expansion of the active 
operating force and management of overall active force endstrength. 
Adding another report on this issue would be duplicative and 
irrelevant. 

Recommendation 4: The GAO recommended that the Secretary of the Army 
develop and provide the Secretary of Defense and Congress with an 
assessment of how the Army will fully staff its modular operational 
combat force while managing the risk to its noncombat supporting force 
structure. (p. 25-26/GAO Draft Report): 

DOD Response: Nonconcur. The Army provided the Office of the Secretary 
of Defense a plan for reshaping the Army, including increasing the 
active operating force to 355,000 Soldiers and downsizing Regular Army 
endstrength to 482,400 Soldiers by fiscal year 2011, based on several 
assumptions. The Army will revisit its endstrength plan if the 
assumptions prove invalid. 

Recommendation 5: The GAO recommended that the Secretary of Army 
develop and provide the Secretary of Defense and Congress with a 
comprehensive plan for assessing the Army's progress toward achieving 
the benefits of modularity to include: 

* specific, quantifiable performance metrics to measure progress toward 
meeting the goals and objectives established in the Army Campaign 
Plans; and: 

* plans and milestones for conducting further evaluation of modular 
unit designs that discuss the extent to which unit designs provide 
sufficient capabilities needed to execute National Defense Strategy and 
2006 Quadrennial Defense Review objectives for addressing a wider range 
of both traditional and irregular security challenges. (p. 26/GAO Draft 
Report): 

DOD Response: Partially concur. The Amy will explore the development of 
expanded performance metrics to determine their potential value in 
managing the modular transformation of the Army. Given the ongoing long 
war against global terrorism, fulfilling combatant commander needs for 
Army forces is the preeminent performance metric, and the Army 
continues to fully meet force requirements for the war. The Army 
equipping strategy also provides for the adequate equipping of Army 
forces for homeland missions. Development of plans and milestones for 
further evaluation of modular unit designs is unwarranted, as such 
evaluations are embedded in Army processes and occur continuously under 
the close supervision of the Army leadership. The doctrine, 
organization, training, manning, and equipping of Army modular forces 
will be a continuous process, informed by multiple sources, including 
feedback from Soldiers and leaders who have served in combat in modular 
forces. 

Recommendation 6: The GAO recommended that the Secretary of Defense 
direct the Secretary of the Army to provide a testing plan as part of 
its Army Campaign Plan that includes milestones for conducting 
comprehensive assessments of the modular force as it is being 
implemented so that decision makers - both inside and outside the Army 
- can assess the implications of changes to the Army force structure in 
terms the goals of modular restructuring. The results of these 
assessments should be provided to Congress as part of the Army's 
justification for its annual budget through fiscal year 2011. (p. 26/ 
GAO Draft Report): 

DOD Response: Nonconcur. The Army thoroughly evaluated modular force 
designs, as noted in this report, and continues to evaluate all facets 
of modular force performance both in training and combat operations. 
Proposed changes in doctrine, organization, training, manning, and 
equipping are thoroughly and continuously assessed and implemented, 
consistent with the needs of the warfighter and available resources. 

[End of section] 

Appendix III: GAO Contact and Staff Acknowledgments: 

GAO Contact: 

Janet A. St. Laurent (202) 512-4402: 

Acknowledgments: 

In addition to the person named above, Gwendolyn Jaffe, Assistant 
Director; Margaret Best; Alissa Czyz; Christopher Forys; Kevin Handley; 
Joah Iannotta; Harry Jobes; David Mayfield; Jason Venner; and J. Andrew 
Walker made major contributions to this report. 

FOOTNOTES 

[1] The Future Combat System (FCS) is a family of weapons and other 
systems including manned and unmanned ground vehicles, air vehicles, 
sensors, and munitions linked by an information network. The FCS cost 
estimate is in then-year dollars as of January 2006. 

[2] Army personnel assigned to noncombat positions provide management, 
administrative, training, and other support. Operational combat forces 
include personnel assigned to the Army's combat, combat support, and 
combat service support units. 

[3] GAO, Force Structure: Preliminary Observations on Army Plans to 
Implement and Fund Modular Forces, GAO-05-443T (Washington, D.C.: Mar. 
16, 2005). 

[4] GAO, Force Structure: Actions Needed to Improve Estimates and 
Oversight of Costs for Transforming Army to a Modular Force, GAO-05-926 
(Washington, D.C.: Sep. 29, 2005). 

[5] GAO, Force Structure: Capabilities and Cost of Army Modular Force 
Remain Uncertain, GAO-06-548T (Washington, D.C.: Apr. 4, 2006). 

[6] This office is responsible for programming, materiel integration, 
and management of Department of the Army studies and analyses. 

[7] GAO, Military Readiness: Navy's Fleet Response Plan Would Benefit 
from a Comprehensive Management Approach and Rigorous Testing, GAO-06-
84 (Washington, D.C.: Nov. 22, 2005). 

[8] The Army began the formation of Stryker brigades in 2002 and 
completed the formation of the first two Stryker brigades in fiscal 
year 2003. 

[9] This number does not include the formation of two Stryker brigades 
in fiscal year 2003. 

[10] The Army defines this in its Campaign Plan as the effective date 
on which the new modular organizational designs' equipment requirements 
formally apply to converting brigades. The Army calls this a Modified 
Table of Organization and Equipment, which documents the specific types 
and amounts of equipment Army units are authorized to have. 

[11] Under this model, which the Army calls its tiered readiness 
system, high-priority or first-to-deploy units in the active component 
received much higher levels of resources than lower priority or later- 
deploying active and reserve component units. While some units 
maintained high levels of readiness, a large part of both the active 
and reserve components were in a low state of readiness, with the 
expectation that there would be sufficient time to add the required 
resources prior to deployment. 

[12] At the time of this report, the Army was in the process of 
revising its equipment requirements based on the planned reduction in 
the number of modular combat brigades from 43 to 42 in the active 
component. 

[13] GAO, Reserve Forces: Plans Needed to Improve Army National Guard 
Equipment Readiness and Better Integrate Guard into Army Force 
Transformation Initiatives, GAO-06-111 (Washington, D.C.: Oct. 4, 
2005). 

[14] The National Defense Authorization Act for Fiscal Year 2006, Pub. 
L. No. 109-163, § 401 (2006), sets the end-strength level for the Army 
at 512,400, but stipulates costs of active duty personnel of the Army 
for that fiscal year in excess of 482,400 shall be paid out of funds 
authorized to be appropriated for that fiscal year for a contingent 
emergency reserve fund or as an emergency supplemental appropriation. 

[15] The Ronald W. Reagan National Defense Authorization Act for Fiscal 
Year 2005, Pub. L. No. 108-375, § 515 (2004) reduces the minimum number 
of active component advisors required to be assigned to units of the 
selected reserve from 5,000 to 3,500. 

[16] Army officials also told us that some of the earlier 8,400 
intelligence specialist positions have been reclassified as aviation 
specialist positions. 

[17] GAO, Results-Oriented Cultures: Implementation Steps to Assist 
Mergers and Organizational Transformations, GAO-03-669 (Washington, 
D.C.: July 2, 2003). 

[18] GAO, Force Structure: Air Force Expeditionary Concept Offers 
Benefits but Effects Should Be Assessed, GAO/NSIAD-00-201 (Washington, 
D.C.: Aug. 15, 2000). 

[19] GAO-06-84. 

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Fax: (202) 512-6061: 

To Report Fraud, Waste, and Abuse in Federal Programs: 

Contact: 

Web site: www.gao.gov/fraudnet/fraudnet.htm 

E-mail: fraudnet@gao.gov 

Automated answering system: (800) 424-5454 or (202) 512-7470: 

Public Affairs: 

Jeff Nelligan, managing director, 

NelliganJ@gao.gov 

(202) 512-4800 

U.S. Government Accountability Office, 

441 G Street NW, Room 7149 

Washington, D.C. 20548: