*Includes Presidential appointees and Senior Executive Service (SES) and GS16-18's prior to SES. Defense agencies and OSD field activities are excluded. Figures provided by the Office of Personnel Management.

Figures in parentheses were provided by the Office of the Secretary of Defense.

3. Hierarchical Structure of OSD

As of April 1959, the Secretary and Deputy Secretary of Defense had 14 officials in OSD and OSD subordinate organizations reporting directly to them: seven assistant secretaries, the Director of Defense Research and Engineering, the General Counsel, three assistants to the secretary, and the Directors of the National Security Agency and of the Advanced Research Projects Agency.

As additional staff support was provided to the Secretary of Defense and as Defense Agencies were created, the number of officials reporting to the Secretary and Deputy Secretary of Defense continued to increase. By 1977, when Dr. Harold Brown assumed the position of Secretary of Defense, 34 officials reported directly to him and his Deputy.

Secretary Brown instituted a number of organizational changes and staff reductions to reduce the excessive number of individuals and functions reporting to him and to streamline his own and subordinate staffs. These changes reduced the size of the OSD staff from 2,065 to 1,519 personnel. Secretary Brown's major changes included the following:

。 elimination of two Assistant Secretaries of Defense;

o elimination of one of the two Deputy Secretary of Defense positions;

o creation of two new Under Secretary of Defense positions, one for Policy and the other for Research and Engineering;

o transfer to the Under Secretary for Research and Engineering of the major weapon systems acquisition responsibilities previously carried out by the Assistant Secretary (Installations and Logistics);

• consolidation of the position of Assistant Secretary of Defense (Intelligence) and Director, Telecommunications, Command

and Control Systems under a new Assistant Secretary of Defense (Command, Control, Communications, and Intelligence); • consolidation of manpower, reserve affairs, installations and logistics responsibilities in a new Assistant Secretary (Manpower, Reserve Affairs and Logistics) in lieu of the prior breakout under two Assistant Secretaries, one for manpower and reserve affairs and the other for installations and logistics;

• establishment of a NATO affairs advisor reporting to the Secretary; and

• assigning supervisory responsibility of Defense Agencies to OSD officials, rather than the Secretary, as a further means of reducing the number of individuals and offices reporting directly to the Secretary.

Currently, the Secretary and Deputy Secretary of Defense have 24 OSD and Defense Agency officials reporting to them (excluding their immediate assistants and the Executive Secretariat):

。 two under secretaries

• ten assistant secretaries

o the General Counsel

• Director, Program Analysis and Evaluation

• Director, Net Assessment

• Director, Operational Test and Evaluation

• Director, Small and Disadvantaged Business Utilization

• Defense Advisor, U.S. Mission to NATO

• Assistant to the Secretary (Intelligence Oversight)

• DoD Inspector General

• Director, Defense Intelligence Agency

o Director, National Security Agency

• President, Uniformed Services University of the Health Sciences Director, Strategic Defense Initiative Organization

4. Functional Organization of OSD

a. Emergence of Functional Areas in OSD

When James Forrestal took office as the first Secretary of Defense in September 1947, "he had no office, no staff, no organization chart, no manual of procedures, no funds, and no detailed plans" in the words of the 1948 Eberstadt Task Force. Forrestal formed an ad hoc committee to survey his staff requirements and make recommendations on the organization of his office. This committee felt that a small staff would be sufficient and recommended that Forrestal divide the activities of his office into functional areas: legal and legislative matters, budgetary and fiscal affairs, and public relations. The three special assistants authorized by the National Security Act were to serve as the principal coordinators in these three functional areas.

Throughout this study, the terms "functions" and "functional organization" are frequently used. Given the central role of these

terms and the concepts that they represent in subsequent portions of this study, they need to be fully understood. In traditional management terminology, the term "functions" means the primary activities that an organization is to perform. In the business world, these primary activities include manufacturing, marketing, distribution, engineering, research and development, finance, and employee relations. DoD performs many of these activities, but has other major activities. Functions of DoD include research and development, manpower, policy formulation, installations, logistics, and finance (comptroller). The three primary bases for structuring organizations are by (1) functions, (2) products, and (3) geography. "Functional organization" means the use of functions to divide the organization into major units.

Forrestal received different recommendations on the organization on his office from Donald C. Stone of the Bureau of the Budget. Stone stressed the Secretary's need for a staff composed heavily of specialists to analyze substantive issues and interpret programs and plans. Regarding the special assistants, Stone argued that "the most effective use of these assistants will be for work which cuts across organizational lines." He added, "the broad objective should be to establish an arrangement under which the special assistants can render the maximum assistance to the Secretary of Defense and have to that end the maximum breadth of point of view and experience in day-to-day operations." (The Formative Years, page 59)

Forrestal was apparently sympathetic to Stone's views and incorporated many of his thoughts into the job descriptions of his special assistants. However, the organization of the Office of the Secretary of Defense along functional lines was the predominant theme. This organizational theme has continued throughout the history of OSD. As OSD has grown in size and as new responsibilities have been added, the office has been organized strictly along functional lines. OSD currently provides staff assistance to the Secretary of Defense in 20 functional areas. Twelve of these were established by 1953 with others added as additional functional support for the Secretary became evident. Two other functional activities-special operations and civil defense-were briefly performed by OSD offices during the late 1950's and early 1960's respectively. The following table shows when the current 20 functional areas became part of the responsibilities of OSD; functional areas were viewed as becoming part of OSD responsibilities when a distinct organizational entity was created to handle that function.

Between 1953 and 1983, there have been numerous changes in the grouping and separating of these staff functions as well as the title of the senior official for various offices. The reasons for these changes included the management style and needs of the Secretary of Defense, the skills of senior officials to which these various responsibilities were to be assigned, and the substantive or political importance attached to certain areas. Figure 3-1 presents the history of these changes. As Figure 3-1 shows, the greatest changes have occurred with respect to five functional areas: supply and logistics, properties and installations, manpower and personnel, reserve affairs, and health and medical.

FIGURE 3-1

b

In 1973, this position was retitled Director, Telecommunications and Command and Control Systems.

с

This position was later retitled ASD (Health Affairs).

ASD (MRA&L)