DoN will divest those activities/functions that are no longer relevant to our core mission today.  We will assess our core competencies, determine what functions are inherently governmental, and carefully consider the cost of personnel (life-cycle costs of active duty military personnel are, by grade, higher than their civilian counterparts).  As a general rule, we will contract out those functions determined to be non-governmental.  Functions that are determined to be governmental will be divided into three categories:  those that should be done just by civilians; those that may be done by either military or civilians; and those that must be done just by military personnel.  For those functions that can be done by either military or civilians, NSPS will provide the flexibility and performance initiatives to enhance the assignability of civilians to these military-civilian jobs.

DoN will transform the Active Component, Reserve Component, and Civilian Work Force to achieve Naval Power 21 through three major initiatives: 

·         Transform the active duty Navy personnel system by modernizing the human resource system to support Sea Power 21.  While executing Sea Enterprise and Sea Warrior, we will determine "where the people are," assessing jobs, functions, and workload, and drawing down the active duty Navy end strength accordingly over the FYDP.

·         Transform the reserve force through the Active-Reserve Integration initiative to rebalance the mix of active and reserve forces and ensure operational readiness for forward presence and surge capabilities.

·         Transform the civilian personnel system by aggressively implementing the NSPS, facilitating civilian-military assignments using streamlined classification and pay banding systems.  We will begin this work by requesting inclusion of 120,000 DoN civilians for NSPS conversion in FY-04.

Through these three transformational initiatives, the Department of the Navy and its Services will have a human resources system that is high-performing, efficient, balanced, aligned, and effective.  It will enable achievement of the Naval Power 21 vision.