Research for Research Memoranda

This study was sponsored by the Deputy Chief of Naval Operations for Logistics (N4) who asked us to assemble the lessons learned in outsourcing and privatization. Earlier work for this study identified new opportunities for the Navy and identified initial lessons learned at a Navy technical center. This study also identified specific ways to streamline the competition process required by OMB Circular A-76, and initial findings of five outsourcing and competition case studies reported in earlier reports issued from this project. In this final report, we focus on privatization, as distinct from outsourcing. We make the distinction clearer in the body of the paper. For this report, we reviewed the economics literature to determine whether (and if so, why) public sector firms are inherently less efficient that private sector firms. We conducted case studies of the office of Personnel Management (OPM) privatization of its background investigations unit, and the Naval Air Warfare Center (NAWC) - Indianapolis privatization. We also examined the competition program run by the City of Indianapolis for many of its city services, including the outsourcing of the local wastewater treatment plant. Finally, we collected information on other privatization, both in the United States and abroad.

In 1955, the Office of Management and Budget (OMB) implemented a policy known as the Commercial Activities (CA) Program. This program enables the private sector to compete with government organizations in providing goods and services when it is appropriate and economical to do so. The objective is to promote an efficient support structure through competition. This research memorandum is part of a CNA-initiated research effort examining the DoD Commercial Activities program. Most of our previous research has examined the Navy CA program. This paper presents the results of all completed DoD comprehensive A076 competitions between 1978 and 1994.

The end of the Cold War has led to a major reexamination of the requirements fir medical personnel and other resources necessary to care for Department of Defense (DoD) beneficiaries. Despite large numbers of peacetime beneficiaries, the primary need for medical resources remains the wartime mission. During the Cold War, the requirement for wartime medical providers was high and could easily justify large numbers of active duty personnel. Today's defense guidance is based on fighting two major regional contingencies (MRCs), and the required number of medical providers has fallen sharply. Determining the number and types of medical resources needed to treat casualties of future conflicts is an important and complicated issue. To help shed light on the process of determining wartime medical requirements, N-931 asked CNA to examine the methods and models that are currently in use or may be used in the near future. The current process is in flux. The models used today are being changed. The use of one model was discontinued recently when the Joint Staff changed to a new command-and-control system. The Joint Staff has proposed a replacement, but the new model is still being developed and there is some concern about its adequacy in determining service medical requirements. In this memorandum, we examine the current and proposed theater-level requirements models.

In this Navy study of nondeployable personnel, we undertook several analyses of pregnancy for enlisted sailors. These analyses are not definitive because the navy still lacks individual-level data on the pregnancy status of sailors. The Bureau of Naval Personnel is working hard to obtain reliable and complete information on the pregnancy status of enlisted sailors. We both hope and anticipate that such data will be available soon. During the course of the study, we developed a method for extrapolating pregnancy rates based on the available information. We are sufficiently confident of our estimated data to expect that, when actual data become available, our estimates will show the trends and be close to actual rates. We a re not sufficiently confident of our method, however, to say that our estimates will replicate the actual data.