The Naval Postgraduate School in Monterey, California, costs the Navy much more than educating officers at any civilian university. A public-private partnership arrangement not only would be cheaper and more efficient, but also would induce more officers to pursue graduate education.
Of all the military services, the Navy traditionally has placed the least importance on graduate education. The Navy's culture has long favored training and operational experience over formal education. An 18- to 36-month hiatus from the Navy to obtain a graduate degree (and, until recently, professional military education) simply is not viewed to be as valuable to the Navy as is another operational tour.
The Navy leadership recognizes the need to restructure and revitalize its education programs. The recently published Vision Statement for Navy Officer Education asserts that "flexibility and creativity are more important than ever as today's fast pace and rapid increase in technological sophistication define our times." The Vision Statement further articulates that officers must be committed to life-long learning, as it is the experience and formal education that provide and enhance one's ability to deal with the unknown. Finally, the Vision Statement mandates that commanding officers and other senior leaders make education a priority in the development of the officer corps.
Although the Navy is taking a series of steps to realize this vision, there is little chance of any long-term impact without significantly greater—and much more politically and culturally difficult—changes in educational policies, procedures, and priority. Nothing less than a large-scale review and overhaul of the entire officer education program, including the operation of the Naval Postgraduate School (NPS), is required to grow the type of officer primed to deal with the challenges of this new century. First, however, the Navy must decide the objective of a Navy-funded graduate degree, and then support that objective in practice.
The Navy's Dilemma
In spite of the Navy's traditionally low emphasis on graduate education, its spending on such programs is substantial—$204 million in fiscal year 1999.1 Approximately half of this amount is for the operation and maintenance of NPS and the Naval War College, the latter of which offers primarily professional military education courses. Particularly insightful is the Navy's investment in NPS, where operations-and-maintenance funding alone for fiscal year 1999 was $70 million, up from $63 million just two years ago. Moreover, while the cost of operating NPS has increased 10% over the past two years, the number of naval officers attending NPS has actually decreased 12% from 1,010 to 888.
Owned and operated by the Navy since the early 1900s, NPS is one of only two Department of Defense (DoD) graduate schools. The other school, the Air Force Institute of Technology (AFIT) in Dayton, Ohio, is smaller and offers only technology programs. Like NPS, AFIT has had a tenuous history. With the budget cuts and declining military force structure that followed the end of the Cold War, the Air Force had difficulty justifying the high cost of school. In 1997, the average cost per student to attend AFIT was $42,000 per year.2 Declining enrollments and high cost, coupled with the fact that several similar civilian schools were located near AFIT, forced the decision by the Air Force to close the school in 1997 and send students to civilian universities, and to NPS. Because of subsequent political rallying in AFIT's home state of Ohio, the Air Force was ordered by Congress to reopen the school, which now functions in a reduced capacity.
A significant percentage of the Navy's officers forgo this option of a government-funded education, opting to invest their own time and money to earn a degree. While the surface community has the largest percentage of people with master's degrees, most were Navy-funded. At the other extreme is the aviation community, with the smallest percentage of master's degrees. An overwhelming majority, however, were obtained at the aviator's expense and time. This contrast indicates the significant differences that exist among the warfare communities as to the perceived priority of graduate education for continued career progression.
While the stated objective of the Navy's graduate education program is to grow officers with subspecialty knowledge, this goal is not supportable in practice. Theoretically, the Navy needs officers with knowledge in certain specialty areas, owing to specific job requirements. The curricula taught at NPS, as well as the number of students, are determined by this list of job requirements. At present, there are 44 different curricula taught at NPS.
In reality, however, there are so many subspecialties—76 at present—that the system for tracking and assigning officers who have completed graduate education and possess these subspecialty skills has become unmanageable. Furthermore, although officers receiving graduate education are supposed to be assigned immediately to related jobs, this rarely occurs. Instead, these officers—who have been absent for a significant amount of time from their primary jobs of war fighting—must immediately be remanded to the fleet to maintain their competitiveness for promotion. Navy promotion boards seem to value operational experience over graduate education and in many cases the time spent away from the Navy and at an educational institution can detract from promotion potential.
Therefore, it is not surprising that the percentage of officers fulfilling the DoD requirement to perform a subspecialty utilization tour following completion of graduate education is dismal. A study conducted by the Center for Naval Analyses puts the Navy's percentage of subspecialty-matched utilization tours—after a period of six years following completion of education—at approximately 20-25%.3 Providing further confusion to subspecialty management, many officers who receive their graduate education on their own admit to not reporting their accreditation to the Navy, citing that they do not want to be restricted in their future assignments to jobs requiring that subspecialty.
Another criticism of the graduate education program—and NPS specifically—is the longer duration of the curricula as compared to that offered at civilian schools. Curricula are designed in response to Navy-determined educational skill requirements (ESRs), which supposedly are designed to meet the subspecialty billet requirements. In most cases, however, these ESRs far exceed the requirements imposed by the respective degree accreditation authority. To meet the Navy's requirements—in addition to the degree requirements—the student load typically is much greater than that at a civilian university. This increases the already significant amount of time spent removed from a warfighting billet.
What Type of Officer Is Needed for the 21st Century?
Added to these issues is the broader concern of whether NPS, as a school closed to non-DoD civilian students and with only a narrow, Navy-oriented educational environment, is the best vehicle to educate officers. The skills and traits that will enable officers to function with ease in an increasingly complex and interdependent global environment are different from those that sufficed in the past. All officers will need to learn how to deal with the growing variety of military missions, such as humanitarian assistance, peacemaking and peacekeeping, crisis de-escalation, and the art of diplomacy. Knowledge of cultures and languages will be increasingly important. Officers should learn the process and practice of innovation and the skills of an entrepreneur. Emphasis should be placed on public speaking and the art of debate—currently a skill sorely missing in all the military services. Other areas of knowledge that will be important include "better business practices," the basics of acquisition, and—perhaps most significant—a good understanding of the functions, interoperability, and maintenance of computer networks.
These skills and traits are not currently nurtured and instilled in any meaningful way in the officer corps. They certainly are not skills that have been designed into the curricula at NPS. The justification for the Navy having its own graduate school is to provide only the unique subspecialty skills that the Navy purports to need. In fact, the Navy—by congressional directive—cannot offer curricula that can be found at civilian universities.4 Curricula taught at NPS must have "unique" requirements or characteristics that preclude their being taught elsewhere.
When analyzing the course content of the curricula, very little can be found that is not offered at other universities. Most skills cited by NPS as being "unique" would be more properly taught in a Navy training environment. Renewable or technology-related skills are best learned immediately before assuming a job requiring those skills. More significantly, there does not seem to be a part of any curriculum that could not be taught by a civilian university if anyone were asked to structure and teach such a course for military students. One example of such a partnership is the Navy/MIT Naval Architecture Program that has been in existence since 1909. The Navy and MIT work together to design and teach two curricula at MIT in ship design and shipboard maintenance. Classified courses—up to the secret level—are included in the curricula and MIT students as well as Navy students attend all phases.
Since the justification for the existence of NPS is to provide officers with what now are commonly agreed to be overly tailored subspecialty skills, in a system that only infrequently enforces utilization tours, a better approach to advanced education is warranted. With the number of operational requirements only increasing for the Navy and retention rates at a 20-year low, there does not appear to be any relief on the horizon with respect to the already tight Navy officer career path. Thus, there seems to be little chance to increase the percentage of subspecialty utilization tours, which are primarily shore-duty tours. One alternative approach would be to reduce the number of subspecialties in the Navy to five general fields, which would greatly increase the opportunity to match the now broader specialty area with a related follow-on tour--during both sea and shore duty.
The current 76 subspecialties could be folded into five core fields such as information operations and management, engineering and technology, resource and operations analysis, financial management, and political-military and regional affairs. This approach still would provide the specialty area knowledge and skills to meet the Navy subspecialty billet requirements. It also would facilitate the inclusion of thinking skills in the aforementioned areas of institutional cultural innovation, the art of diplomacy and debate, knowledge management, cultures and languages, etc., that will be necessary to adequately shape and prepare officers for the challenges of the future.
This approach also mandates a rethinking of the need and purpose of NPS. It is important that officers have the opportunity to receive advanced education, but providing that education is not a core competency of the Navy. Indeed, the Navy continually has had to justify the operation and maintenance of its own graduate school within a nation that is home to the best universities in the world.
Providing Graduate Education
The cost to the Navy of owning and operating its own graduate school is much more expensive than the cost of educating its officers at any civilian university in the country. A 1998 assessment indicates that it costs the Navy approximately $65,000 per student per year for each individual who attends NPS.5 The cost per student is even higher today, as the number of students attending NPS has declined and the cost of operating the school has increased since 1998. Alternatively, the Navy spends an average of less than $15,000 per year for its officers to obtain graduate degrees at civilian universities.6 The high cost of NPS can be explained in large part because civilian tuition rarely covers the full cost of providing an education. Instead, endowments and other private funding for research and grants—vehicles not accessible to NPS—supplement tuition. The high cost per student also is due to the fact that although NPS has an operating capacity of around 2,000 students, it has not operated at full capacity since the military began to downsize in the early 1990s. NPS currently has an enrollment of 1,304 students—only 888 from the Department of the Navy. The remaining 416 are from the other U.S. military services, the DoD, and foreign militaries.
While closing NPS and allowing all naval officers to obtain graduate education at civilian universities would be the most efficient and cost-effective path to revitalizing the graduate education program, this option to date has been politically untenable. There are several other avenues for revitalizing the Navy's graduate education process that are worth exploring. While NPS is taking steps to reduce its operating costs, it is clear that small-scale outsourcing and other minor efficiencies will not significantly change the current situation. Feasibility studies need to be conducted on several revolutionary ideas, such as providing educational vouchers to officers to use at institutions (including NPS) of their choice, providing new opportunities for distance learning, substituting certificate programs for degrees in certain technical areas, partial or whole-scale outsourcing, and privatizing NPS.
Because these ideas involve substantial change, investigating any of them will be controversial. But providing graduate education is not an "inherently governmental function." A function described as inherently governmental is one that is "so intimately related to the public interest as to mandate performance by Government employees."7 The Office of Management and Budget's Circular A-76 directive (regulating public-private sector competition) further describes governmental functions as not in competition with the commercial sector and as falling into two categories: the act of governing, and monetary transactions and entitlements. Clearly, the function of NPS does not meet the criteria of "inherently governmental."
Providing vouchers would be one way to provide educational choice to officers. Voucher systems work well in situations where there are widespread differences in individual preferences, where there are many competing suppliers of the service, and where the quality of the service is easily determined.8 The Navy could offer vouchers competitively in definite amounts or open-ended, whereby students could use them at any approved institution—including NPS—provided they gain admission. The competition for students would drive the operation of NPS to become as efficient and responsive as possible. Bureaucratic processes would be diminished by necessity.
Contracting out the service of providing advanced education—either in part or in full—is another option worthy of consideration. In this case, the Navy would contract out to private industry or civilian educational institutions many or all of the functions or services of NPS. For example, the Navy could contract out the operations, maintenance, and/or administrative functions of the school, the fire department, the child-care center, the personnel support detachment, or one or several of the educational departments. In this type of contracting, the Navy would retain ownership of the facilities or assets but would contract with a private institution to operate them. This arrangement differs from leasing in that the private firm does not use the assets in its own business. It simply manages them on behalf of the Navy. Leasing NPS to a qualified institution for a predetermined period of time—perhaps with an option to buy—also is a viable arrangement for a private-public partnership.
Another option for a public-private partnership is full-scale privatization of NPS. Privatization of NPS differs from contracting out in that NPS facilities and assets would be sold or leased to a private institution. This institution would assume responsibility for the physical plant, educational infrastructure, operations, and management of NPS. The Navy would pay tuition for officers to attend. This option would open the school to civilian students, thereby enabling full-capacity enrollment and reducing the cost per student. As with the MIT/Naval Architecture Program, the Navy would obtain a commitment for a number of students per year, the institution and the Navy would share admissions decisions, classes would be conducted on a year-round basis, and military-relevant research—including classified—would be required. The benefits of privatizing NPS would be substantial budgetary savings, higher-quality services, programs and services that currently are not available, more flexibility, less bureaucracy, and increased innovation as a result of the interaction of military and civilian students and faculty.
Divestment of NPS could occur in its entirety or only partially—in effect, a public-private partnership with the Navy retaining majority, minority, or some portion of ownership. The sale also could occur in stages called "tranches," perhaps at 10% a year over a 10 year-period or less, depending on the amount of divestment desired. A similar strategy could be used for contracting out or leasing portions of NPS.
Opposition to the idea of privatization frequently occurs because there is a misunderstanding of the difference between "providing for" and "producing" a service. When privatization of NPS is suggested, often there is the erroneous assumption that if the Navy divests itself of producing the education, it will lose control as the provider as well. In reality, the Navy would retain the responsibility for providing, structuring, and paying for the education, without producing the education itself.
To privatize NPS, a long-term implementation strategy will be necessary, spearheaded by a Navy public-relations campaign to push for congressional support because legislative changes will be necessary. Critical to ensuring success of this effort is a strong coalition of stakeholders—the Navy's senior leadership and its officers who must drive the process by a desire to obtain the best education possible, in the most time- and cost-effective manner. If the political will does not exist to see through the process to completion, it will fail.
A public-private partnership arrangement for NPS would provide many great benefits to the naval students and also would allow the school to flourish. It would provide the opportunity to increase the quality, variety, and flexibility of the educational programs that can be offered. Navy-civilian student and faculty interaction would increase, which would help bridge the growing divergence in the military and civilian societies. High quality educational institutions normally have large endowments that could be of great benefit in maintaining and improving the physical and educational infrastructure at NPS. It would provide the opportunity to operate the school at full capacity, reducing cost per student; after many years of having to justify its existence, this finally would place the school on the path to revitalization and growth. Privatization of NPS by a top-tier university—such as MIT, Stanford, or the University of California—would allow more naval officers to obtain these prestigious degrees, and also function as a retention tool and an inducement for graduate education.
The emotional and organizational costs associated with departing from the comfortable environment of operating the Navy's own graduate school cannot be understated, but the long-term benefits for officers and the Navy are clear. These initiatives, operating within a Navy culture that places equal value on educational and operational experience, will create officers best prepared to deal with the unknown—which is the goal of the Vision Statement for Navy Officer Education.
Janice Graham is a retired Navy officer and a 1991 graduate of the Naval Postgraduate School. Currently, she is a research associate at The Potomac Institute for Policy Studies in Rosslyn, Virginia, and a doctoral candidate at The George Washington University.
1. This figure is actual spending for residential programs and includes student salaries. This figure excludes spending for professional schools such as medical or law school. back to article
2. Per conversation with Commander of AFIT, May 1998. This figure is the operation and maintenance funding for the school divided by the number of students; it does not include student salaries. back to article
3. Linda C. Cavalluzzo and Donald J. Cymrot, "A Bottom-Up Assessment of Navy Flagship Schools," report by the Center for Naval Analyses, CRM 97-24, January 1998, p. 111. Also see report of the CNO Executive Panel Task Force on Advanced Education, "Navy Line Officer Advanced Education Requirements for the 21st Century," unpublished report of October 1998, p. 13. back to article
4. Title 10 U.S.C., Section 7041-7047, establishes NPS and SECNAVINST 1524.2A of 4 October 1989 defines its purpose as "developing and offering unique curricula which are unavailable elsewhere because of lack of civilian interest, uneconomically small classes, constraints on classified research, and the absence of relevant expertise and experience." back to article
5. Cavalluzzo and Cymrot, "A Bottom-Up Assessment," p. 64-71. Also see report of the CNO Executive Panel Task Force on Advanced Education, p. 23. This figure does not include student salaries. back to article
6. Ibid. back to article
7. Executive Office of the President, Office of Management and Budget, Policy Letter 92-1, dated 23 September 1992, p. 2. back to article
8. Gary Bridge, "Citizen Choice in Public Services: Voucher Systems," in Alternatives for Delivering Public Services: Toward Improved Performance, ed. E. S. Savas (Boulder, CO: Westview, 1977). back to article