During 1994, the Department of the Navy moved forward with vision and determination to shape the forces for the needs of today and the future. While tough decisions were being made in Washington and our Fleet and Force headquarters to ensure present and future readiness, the Navy-Marine Corps team continued to fulfill its missions worldwide.
Operating tempo was extraordinarily high, the highest recorded for non-deployed forces and, excluding Desert Storm, the highest in a decade for deployed forces. The requirement for flexible, capable naval forces to project power from the sea and to maintain forward-deployed units in the most critical regions of the world continued unabated in the wake of declining force structure. As the Department of the Navy moves into the 21st century, we will continue to avoid the pitfalls of a resource and requirements mismatch that could place the National Military Strategy and our ability to protect the interests of the United States abroad at risk.
THE STRATEGIC ENVIRONMENT
The vital economic, political, and military interests of the United States are global, located across the world's oceans and intersecting those of regional powers. The littorals are where the Naval Service -- operating from sea bases in international waters and projecting power ashore -- directly influences events.
Two years ago the Naval Service defined a new strategic concept, ...From the Sea, to meet the challenges of the post-Cold War environment and to shift the focus from open ocean warfighting to operations in the littorals. Events over the past year have underscored this change in focus and reinforced our commitment to enhancing capabilities in crisis response, power projection, and employment of naval forces from the sea. As challenges around the world have unfolded, we have not allowed our strategic thinking to stagnate. This year we refined our strategic thinking in a new White Paper entitled Forward...From the Sea, which continues the strategic evolution of naval forces forward-deployed, operating in the littorals as an instrument of U.S. foreign policy.
Forward-deployed naval forces -- manned, equipped, and trained for combat -- play a key role in demonstrating both the will and the capability of the United States to join with our friends and allies to defend shared interests. Should diplomacy fail and conflict erupt, naval forces provide the means for prompt sea-based reaction. This year, the Navy-Marine Corps team is more capable than ever of applying overwhelming combat power, executing forcible entry quickly, and providing the protective cover essential to enable the flow of follow-on heavy forces.
Naval forces provide essential capabilities across the broad spectrum of operations -- from strategic deterrence to peacetime presence operations to warfighting in the major regions of the world -- tailored for national needs and shaped for joint operations. These accomplishments are possible only through the efforts of our extraordinary men and women, operating superior equipment, and with outstanding support.
NAVAL FORCES IN ACTION -- 1994
During this past year, the Naval Service has focused on the projection of power from the sea in the littoral regions of the world. The ability to mass forces quickly in response to crises has enhanced the demand for Naval expeditionary forces. Operating tempo and personnel tempo, including the use of Reserve assets, have increased to ensure the Naval Service's ability to support the nation's global military requirements. Measures have been developed and employed to allow response to crises at an acceptable risk in more stable areas. These include tethering (having battle groups near enough for acceptable response times) and gapping (selectively limiting the duration of presence in stable areas of interest).
PEACETIME OPERATIONS
Naval forces are an indispensable instrument of American foreign policy. In peacetime, our forces build interoperability -- the ability to operate in concert with friendly and allied forces -- so that we can participate fully on multinational teams or as part of coalitions forged to react to short-notice crises. Participation in both NATO Standing Forces and in a variety of exercises with the maritime, air, and land forces of coalition partners around the Pacific Rim, Norwegian Sea, Arabian Gulf, South America, and Mediterranean basin provide solid foundations for sustaining interoperability with our friends and allies.
Over the past year, forward-deployed U.S. naval forces have contributed significantly to humanitarian assistance and disaster-relief efforts -- from Bangladesh to the Philippines. Additionally, the Partnership for Peace efforts with former Warsaw Pact countries show promise in forming solid foundations on which to build interoperability and mutual cooperation, further enhancing regional stability.
The same forces that are dispersed around the globe are also in the best position to react to crises or to provide the initial enabling force in a major regional contingency. Forward-deployed Naval Forces are the link between peacetime presence operations and response to a building crisis or major contingency.
THE ROLE OF PRESENCE
The mere presence of naval forces is insufficient to deter potential aggressors unless those forces also possess the capability to respond rapidly and effectively with credible combat power. Forward-deployed surface combatants such as the new ARLEIGH BURKE class destroyer -- with the enhanced AEGIS Combat System capability -- will play an important part in deterring the proliferation and use of ballistic missiles by extending credible defenses to friendly and allied countries. Carrier Battle Groups and Amphibious Ready Groups with embarked Special Operations Capable Marine Expeditionary Units provide Unified Commanders with the necessary building blocks to mass forces quickly in response to a building crisis. Submarines, capitalizing on their inherent stealth, endurance, and firepower, prepare the battle space for naval forces responding to any crisis. These naval forces complement the capabilities resident in the Army and Air Force, giving the warfighting Commanders in Chief a fully capable joint force which can be sized to respond to any emerging crisis or major contingency.
The sovereign quality of naval forces, operating in forward areas, allows them to be employed free of the diplomatic encumbrances that may inhibit or otherwise limit the scope of land-based operations in forward theaters. This is a unique characteristic of naval forces. The advantages of such a highly flexible and capable force have been proven many times during the past year in such diverse ways as non-combatant evacuation operations in Rwanda, refugee assistance in Cuba, and crisis management off the coasts of Korea and Kuwait.
Whether surging from adjacent theaters or from homeports in the United States, naval forces are uniquely positioned, configured, and trained to provide a variety of responses in the face of unexpected international crises. A good example of the versatility and importance of our forward-deployed naval forces are the accomplishments of the PELELIU Amphibious Ready Group and embarked 11th MEU(SOC) during this year's regularly scheduled six-month deployment. While deployed they conducted four major operations that included one non-combatant evacuation operation in Rwanda and a major search and rescue operation off the coast of Kenya. These both occurred while maintaining watch over the highly volatile situation in Somalia. In most of these situations, forward-deployed naval units were the only force able to meet the initial response time constraint of the crisis. Further accomplishments showing the operational flexibility and responsiveness of naval forces in 1994 are highlighted in Table VIII-1.
PEOPLE
People are the key to readiness. Sailors, Marines, and civilians; Active and Reserve; men and women from all walks of life and every part of American society are the heart of the Naval Service. We fully intend to keep faith with our people who are the core of our readiness to respond quickly and decisively in regional conflicts throughout the world. Maintaining properly motivated and trained Sailors and Marines during these challenging times requires careful planning and effective management of personnel issues. To these ends our manpower strategy seeks to recruit the highest quality men and women; retain our high quality active, reserve, and civilian career force; provide proper compensation for the job we ask our people to do; enhance the quality of life we provide our Sailors, Marines, and their families; maintain a tolerable operating tempo by maintaining overseas deployments of six months, with about a year of training and refit between deployments; achieve remaining personnel reductions through a reasonable plan utilizing the management tools already provided by Congress; maintain a high caliber officer corps with reasonable promotion opportunity and timing; sustain our combat readiness by ensuring reasonable promotion opportunities; provide innovative programs to offer Commissions to our best enlisted personnel; and target bonuses to those Sailors and Marines whose essential skills will form the core of our future force
Over the past year, recruiting challenges have grown in what continues to be a tough recruiting environment. A smaller population base, reduced civilian unemployment, shrinking recruiting budgets, and a public perception that the military is not hiring make meeting our enlistment goals in both the active and reserve components of the Navy and Marine Corps a decided challenge. With the infusion of resources into our recruiting programs and the extraordinary effort of a superb force, we met the formidable challenge in FY 1994, achieving accession goals with extremely high quality new recruits. Although we are meeting present needs, we must enhance resources and improve recruiting performance to maintain the high quality standards necessary to sustain a top-notch fighting force. Today our people serve in a smaller, more technologically oriented, more survivable force, which will continue to require high caliber professionals as the foundation upon which all else is built. To this end, the Department of the Navy remains committed to recruiting and retaining the best and brightest men and women. Once recruited, our young Sailors and Marines receive leadership and character training which builds upon the core values of the Naval Service: honor, courage, and commitment. In the Navy and Marine Corps Reserve, we continue to seek out and retain the best Sailors and Marines separating from active duty. Reserve recruiting is placing special emphasis on acquiring the correct mix of skills and pay grades needed to meet Reserve requirements, drawing on that cadre of Sailors and Marines who leave active service and desire to maintain a military affiliation.
Both the Navy and Marine Corps achieved accession goals in quality and quantity for FY 1994, but neither service fully met its Delayed Entry Program contract goals. To continue meeting accession goals in FY 1995, the Navy and Marine Corps will need to rely more heavily on direct market recruiting, i.e. immediate commencement of active duty for qualified prospects. Nonetheless, we intend to maintain the quality that has proven to be so important to enhanced performance and reduced attrition. Recruiting an all volunteer force in a competitive employment market continues to demand a properly resourced, well-motivated, and fully supported recruiting effort.
Similar challenges are evident in the Department's civilian cadre. It is imperative that we actively pursue force-shaping measures designed to attract and promote talented new people while remaining faithful to the career transition needs of our senior civilians.
To help solve this recruiting dilemma, we will recruit from the broadest possible pool of eligible recruits. As the demographics of America change, our commitment to attract recruits from all areas of society requires a wider focus and a range of new initiatives. Diversity is an overarching goal of the Department. We are aiming at eliminating gender barriers so that we will be able to recruit from the highest quality pool of candidates throughout our society. Additionally, the Department has committed to recruit, train, and promote more minority men and women by the year 2000 to ensure that the Naval Service reflects the American society it serves -- a population that is projected to include 12 percent African-Americans, 12 percent Hispanics, and 5 percent Asian-Pacific Islanders by the turn of the century. We are increasing opportunities for women. Several classes of combatant ships, from AEGIS destroyers to nuclear-powered aircraft carriers, have already embarked women Sailors, and more will follow. More than 90 percent of all career fields are now open to women in the Navy and Marine Corps. Such policies and programs exemplify the Department's commitment to optimal integration and the fostering of a climate where all members, regardless of race or gender, can compete fairly to achieve their maximum potential.
To improve overall readiness, the Department is committed to providing the best possible quality of life for all of our people and their families. When individual and family needs are met, our Sailors and Marines can devote their total energy to military duties without unnecessary distraction. Major efforts to improve base housing, provide equitable pay incentives and bonuses, and keep the workplace free of harassment and discrimination continue to receive heavy emphasis. Key legislative initiatives include authorizing quarters allowances for single E-6s on Sea Duty, broadening Family Separation Allowance eligibility, and broadening eligibility for Sea Pay. The Department of the Navy increased appropriated fund support to the Morale, Welfare and Recreation program by $65 million in FY 1994 and provided additional funds for the outyears. Family Service Centers are receiving additional resources to ensure continued support to members and their families. The Navy's Neighborhoods of Excellence program and the Commandant's Housing Campaign Plan are designed to develop and revitalize Navy and Marine Corps housing as the foundation of our family housing investment strategy. Programs aimed at prevention of family violence have also received increased emphasis and funding. Additionally, improvements in bachelor and family housing continue to be a priority quality of life issue essential for the well being of the force.
During this fast-paced and demanding year, Navy and Marine Corps operational and shore safety efforts produced a record performance. Reductions of safety-related incidents were recorded in nearly every category (see Table VIII-2).
For example, the Navy and Marine Corps experienced only half as many Class A aviation mishaps this year as in 1993, personnel fatalities dropped 32 percent, and operational fatalities were reduced by 63 percent. New operational safety equipment and programs, including improved afloat and ashore safety training, will sustain this reduction of losses and associated costs, reflecting our unwavering commitment to saving lives and preserving irreplaceable assets.
As we enter the final 25 percent of the drawdown, it is imperative our force-shaping tools shift to support retention of the force for the future. The Department of the Navy at the turn of the century must be comprised of the right people, in the right pay grades, with the right skills, ready to operate Forward...From the Sea. We must see through the rightsizing process and focus on the future now to ensure a ready, capable force for the 21st century.
READINESS
Well-trained people, operating modern, well-maintained equipment are the cornerstone of today's Navy-Marine Corps team. Readiness of Reserve and Active forces is the foundation of the credibility of the U.S. military as an instrument of U.S. foreign policy and resolve. Consistent with Administration and congressional priorities, the Department of the Navy has given current readiness top priority.
Despite resource reductions, we continued to perform all the missions assigned to naval forces. However, the pace and cost of supporting unanticipated contingencies and commitments hinder our efforts to stay ready. The diversion of funds within our Operations and Maintenance accounts which finance contingency operations required us to defer maintenance and training for units not deployed. While we expect to recoup most of the actual dollars lost through supplemental appropriations, we are rarely able to fully recoup lost training opportunities.
Future readiness also received increased attention during the year as we continued to recapitalize to meet the national security requirements of the 21st century. In its simplest terms, future readiness is a function of force structure, a mixture of active and reserve forces, and funding. Reduced funding and force structure require us to carefully balance our resources and to realign our priorities to ensure we sustain our readiness both in the near and long term.
Examples of force structure realignments include modifications to the initial LST class ship decommissioning plan which, when coupled with an innovative enhanced amphibious lift plan, will maintain a 2.5 MEB equivalent lift capability. These two plans will remain in effect until sufficient numbers of LPD-17 and LSD-49 class ships become operational. In addition, the retention of some Guided Missile Frigates (FFGs) will better enable us to meet anticipated operational tasking. However, maintaining current readiness was sometimes accomplished at the expense of future readiness either in recapitalization programs or research and development efforts.
Another important readiness feeder is redirected savings from base closings. We must reduce infrastructure as planned to achieve the savings essential for current operational readiness and future recapitalization efforts. We have anticipated approximately $700 million annual steady-state savings from the upcoming round of closures. If this process is delayed, underfunded, or if our estimates regarding closure costs prove to be inaccurate due to emergent requirements, then the savings we have projected will not be realized.
Since at any given budget level there is a trade-off between force structure, readiness, and modernization, we are continuously reviewing trade-off options as operational commitments, resource levels, threats, and investment opportunities change. In calendar year 1995, we will continue to give priority to current readiness and we will continue to downsize. But, as in the past, we will again review our strategy with the benefit of another year.
TECHNOLOGY
As we size our naval forces to meet today's mission needs, we must continue to modernize weapons, systems, and platforms. Maintaining the technological superiority we now hold over potential adversaries is absolutely essential to success with a smaller force operating in the dynamic and demanding littoral environment.
Operating in the littoral environment demands that naval weapons systems and equipment be survivable, suited to joint operations, and support maneuver warfare from the sea. The variety of threats and evolving missions defined by the post-Cold War security environment mandate improvement in our ability to conduct Theater Ballistic Missile Defense, Naval Surface Fire Support, air-to-ground strike, mine countermeasures, surveillance, communications, sealift, and amphibious lift. Programs such as the Flight IIA DDG 51, the SEAWOLF-class attack submarine, V-22, the New Attack Submarine, the F/A-18E/F, and the Joint Advanced Strike Technology program are designed to meet these mission needs in an affordable manner.
Just as the capabilities of today's naval forces are the direct result of past science and technology successes, the quality of our future naval forces is contingent upon today's investment in science and technology. The Department's recapitalization strategy is based upon our ability to field technologically superior forces in the future. In our commitment to sustaining the Department's science and technology program, we have integrated technology development, from scientific research through prototyping, and have focused our efforts on programs to rapidly insert affordable new capabilities into acquisition programs.
The Department's acquisition strategy focuses on three areas. First, we seek advanced technology insertion in all of our acquisition programs. Recognizing that scarce resources will not support development of many new systems, we are updating our most capable and relevant weapons systems, platforms and equipment by fully exploiting the most promising technologies available in the marketplace. Acquisition reform enables us to adopt commercial practices, products, and technology, which in turn allows us to reap the benefits of rapid insertion of advanced technology at a lower cost.
Second, affordability is considered at every step in the acquisition decision process. By working closely with our partners in industry -- through innovative efforts such as Advanced Concept Technology Demonstrations and the Manufacturing Technology Program -- we are proving new concepts while mitigating technical and production risks before committing to full scale development. Because only the most promising technological opportunities will be considered, we can expect greater assurance of weapons system development at realistic costs.
Advanced Concept Technology Demonstrations offer the prospect of reduced cycle time as we leverage off technologies developed in the commercial sector. Partnerships with industry also provide significant economic advantages to the commercial sector as our participation reduces their costs and expands the market for commercial products.
Third, we are pursuing dual-use technologies by maximizing the use of Commercial Off-the-Shelf and Non-Developmental Items. Acquisition reform efforts are concentrating on removing traditional barriers to using commercial products and technologies. For example, we are pursuing spin-on and spin-off technologies. The first uses commercially available technologies that can be adapted for military use. The E-2C Hawkeye carrier airborne warning and control aircraft mission computer upgrade is an excellent example of such a program. The Global Positioning System (GPS) is an example of a spin-off technology, a system originally developed for military navigation, but which has many civilian uses as well. With overall procurement numbers down, we can no longer afford to maintain an entirely separate defense industrial base.
Prudent investments in science and technology programs and acquisition reform initiatives play a crucial role in our quest to maintain the flexible and highly capable naval forces this nation requires to meet global challenges now and in the 21st century.
EFFICIENCY
The Department of the Navy continues to pursue innovative ideas to radically change the way it operates. We are learning a great deal from America's innovators in private industry who have set an example for increased efficiency and effectiveness through process reform. As a result of our lessons learned from industry, the Department has undertaken several major initiatives: waiver authority delegation, cycle time reductions, and acquisition reform.
The waiver authority delegation initiative speeds up and encourages the process of eliminating unnecessary and burdensome restrictions on the operational commands. The cycle time reduction initiative will create shorter turn-around times on all processes so as to create savings that can be realized in improved readiness. Acquisition reform has been discussed in the past but is now becoming embedded within the acquisition process with the establishment of the Deputy Under Secretary of Defense for Acquisition Reform. In summary, all three initiatives are seeking to reengineer key management processes so that taxpayers will receive the best return for their invested defense dollars.
In addition to these efforts, the Department has several real success stories in 1994. For example, we began integration of Navy and Marine Corps tactical air (TACAIR) wings. As a result of this effort to manage TACAIR as a Department of the Navy asset, the requirement to stand up five additional light attack squadrons was eliminated at a cost avoidance of approximately $700 million over the period of the Future Years Defense Program. Finally, we are decreasing costs by pursuing closure of three naval shipyards and three aviation depots selected in BRAC 1991 and 1993. Once closure is complete, we will have reduced three of six of our aviation depots and three of eight of our naval shipyards to align capacity with need.
Another achievement in efficiency during this past year was the Department's revision of the program and budget development process. We are reemphasizing the Planning in the Planning, Programming and Budgeting System to make sure that we select the right programs and initiatives for investment. Our evolving new process is concept-based. We are assessing resources and requirements against our operational concept Forward...From the Sea. The process is effectively integrated for the first time in three dimensions -- Navy, Marine Corps, and Secretariat. The program and budget we develop will be accountable to a rigorous and comprehensive set of Joint Mission and Support Area Assessments that respond to the guidance of our leadership and the operational requirements of our Fleet and Force Commanders, and complement the Joint Warfare Assessments conducted by the Expanded Joint Requirements Oversight Council in the Joint Staff.
The Department fully embraces the opportunity for increased effectiveness and efficiency which the ongoing Roles and Missions review brings. We welcome the internal and external analysis of our methods, procedures, and organization at all levels that is required to support the important objectives of the Commission.
The Department's overall objective is to provide a high quality, cost effective process that maximizes the return for every defense dollar invested. We are meeting that objective, but we recognize that the future will pose even greater challenges.
The Department of the Navy has taken substantial action this year to size forces for today while continuing to recapitalize for the future. Maintaining the balance between current and future requirements is an ongoing challenge. As the post-Cold War world continues to evolve, so must naval strategy and forces necessary to execute the strategy. Our analysis of strategy and process tells us that the Department's course is correct. The accomplishments of our Sailors, Marines, and civilians have proven our concepts at home and around the world. The Navy-Marine Corps team is the key component in America's forward presence operations, engaging allies in constructive exercises and deterring potential aggressors with highly flexible and credible forces. If deterrence fails, we will fight and win.
John H. Dalton
Secretary of the Navy
