YOUR PRESENTATION TO THE PFIAB ON FUTURE INTELLIGENCE CHALLENGES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP90T00435R000100090011-1
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 9
• Document Creation Date: December 27, 2016
• Document Release Date: April 9, 2013
• Sequence Number: 11
• Publication Date: September 14, 1988
• Content Type: MEMO

t
Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1
25X1
CW. CCD6C T
The Director of Central Intelligence
. Wnhinem D.C. 20505
National Intelligence Council N I C 403061-88
14 September 1988
MEMORANDUM FOR: Director of Central Intelligence
FROM: Fritz W. Ermarth
Chairman
SUBJECT: Your Presentation to the PFIAB on Future Intelligence
Challenges
resource/management implications.
1. Attached are two documents for your consideration as sources of
themes for your meeting with PFIAB next week. Tab A is an essay which might
be used as the basis for a presentation covering both substantive challenges
and Community management issues. Tab B was prepared by the NIC as an input
to the National Foreign Intelligence Strategy, and sets forth our view of
the big substantive targets in the years ahead.
2. I've seen a draft of what Doug George prepared for General Heinz to
send you for this occasion, and have no problem with it. When you've had a
chance to reflect on what you've been given, Doug and I can respond to your
instructions to prepare something final for the meeting. I spoke the other
day with Fred Demech of the PFIAB staff about the purpose of the meeting,
and it was clear that you were largely free to define it as you wish so long
as it involves some mix of both intelligence substance and
SE,EI~
Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1
25X1
 Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1
W. SECRET 25X1
SUBJECT: Your Presentation to the PFIAB on Future Intelligence
Challenges
C/NIC/FWErmarth:jl
Distribution:
Orig - DCI
1 DDCI
1 - SA/DCI
1 - EXDIR
1 - ER
1 - C/NIC File
1 - O/C/NIC Chrono
1 - VC/NIC
(14 Sep 88) STAT
Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1
 Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1 25X1
14 September 1988
FUTURE INTELLIGENCE CHALLENGES
In the decade ahead, US intelligence is certain to face tight, and
likely to face declining, real budgets. At the same time, its tasks appear
likely to expand in number and complexity, as old requirements persist and
new ones get added to our mission. This situation will generate new
pressures for efficient resource management at all levels, but especially at
the level of the Intelligence Community and the NFIP.
Tight Money and Expanding Tasks
The budget picture is relatively clear. Even if the NFIP budget does
better than defense, it will be tight as far as the eye can see, after a
period of expansion.
On the demand side, the picture is also fairly dramatic. It is hard to
think of major intelligence targets of the past which have disappeared or
shrunk in importance. Straining to think of one, I come up with Chinese
ground order of battle. But let there by a spat on the. Chinese border with
Vietnam, India, or the USSR, and we could suddenly be charged with an
"intelligence failure" if we neglected this topic.
Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1
 Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1 25X1
Even if US-Soviet relations continue to improve, we shall be pressed to
track the development and application of Soviet military power in detail.
Even if weapons systems are limited or eliminated by arms control, we must
track them fastidiously to assure compliance. As we enter new and
presumably more meaningful conventional arms talks, demands will grow for
more and more detail on the Soviet general purpose force structure as well
as the surrounding doctrines and operational concepts. Thus, we shall have
to get more sophisticated about the traditional forests while getting more
precise and comprehensive about the trees. And we cannot be sure that
US-Soviet relations will stay improved, so the intelligence demands of
"amity" (e.g., arising from arms control implementation, policing and.
exploiting exchanges, etc) will combine with those of enmity (e.g., threat
assessment, warning).
Meanwhile, the turbulence of the Gorbachev era is adding new dimensions
to the Soviet problem. Hardly a decade ago, topics like the intelligentsia,
the party apparatus, the mood of society at large were the part-time
concerns of less than a dozen analysts in the whole intelligence community.
Today, we can no more afford to be caught unawares by major grass-roots
developments in the USSR than can the Kremlin or the KGB because such
developments, and Moscow's reaction to them, could challenge the viability
of our short-term diplomacy and our long-term strategies. Glasnost has made
easier the task of reaching insights about Soviet society; but doing so
requires more people to process and analyze the new information pouring out
of the Soviet Union.
Outside the "traditional" target areas, we clearly see a proliferation
of intelligence requirements,-both in terms of geography and subject
2
SECRET
Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1
 Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1 25X1
matter. After the USSR, potential crisis areas in the Third World have
traditionally been high priority intelligence targets, particularly in the
Middle East. Even if we succeed in defusing some of these.in cooperation
with the USSR and local participants, and even if our defense and foreign
policies downgrade the importance of some areas, the breadth and depth of
intelligence on these areas can hardly be reduced. This is because
comprehensive understanding afforded by intelligence is a prior condition
for intelligent selectivity in policy and strategy.
Now we have new tasks before us: Terrorism, narcotics, international
economics and finance, the technological and economic competitiveness of
friends and allies, and even the world-wide impact of AIDS. There is
rapidly rising concern now about the proliferation not merely of
nuclear-weapons capabilities, which continues, but of chemical and
bacteriological warfare capabilities and of hi-tech, long-range weaponry.
We have not merely to anticipate and track these developments, we along with
the policymaking community have to figure out what their broader, so to say
"environmental", impact on the international system will be.
Not only in the USSR and East Europe, but throughout the world we have
to pay more attention to deep social and psychological forces, such as the
Islamic Revolution. Conventional collection methods, with their focus on
capitals and ruling elites, are not adequate here. Reliance on journalists
and academics alone is not satisfactory
We cannot afford to be late in detecting another
social upheaval on the scale of the revolution in Iran, for example, in
neighboring Mexico. But keeping up with such phenomena requires deeply
SECRET
Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1
 25X1
Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1
schooled experts, with languages and the ability to travel to the
countrysides and the bazaars of the world. Fortunately, this is not
expensive, but it requires new ways of doing our business.. .or perhaps
resurrecting some very old ways.
Some Management Implications/A View from the 1970s
Complaint from intelligence managers about. tight money and expanding
tasks is familiar; it simply varies in validity. In the 1990s, it will be
much more valid than during most of the 1980s because of diametrically
opposite budget trends. This situation is not unprecedented, however. It
recalls the period extending throughout the 1970s when there was real
shrinkage in the NFIP budget and the size of the Intelligence Community, but
tasks did not in any meaningful way diminish.
As in that period, we shall almost certainly see increased emphasis on
various management themes in the quest for greater resource efficiency, hard
though efficiency is to define in the intelligence business. There are all
kinds of things that can be done to increase efficiency and we shall be
under great pressure to do them. This will involve such things as:
Sharpening priorities, objectives, missions, requirements at all levels;
making the management mechanisms that address these matters real
decision tools rather than perfunctory paper drills.
Trade-offs among programs, especially at the Community-NFIP level, in
terms of their relative ability to satisfy requirements.
Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1
 Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RD P90T00435R000100090011-1 25X1
Sharper scrutiny of the interrelationships of collection, processing,
and analysis. There will be pressure to get more out of expensive
collection through less expensive processing and analysis.
The old "national-versus-tactical" intelligence debate will return, and
more broadly debate about trade-offs between intelligence and defense
dollars. (The debate about the SR-71-is an example.)
Along with these themes will come the quest for tools to help address
them, such as input-output analysis, zero-base budgeting and intelligence
product evaluation. One can also expect new attention to defining the roles
of the.DCI, especially the relationship between his role as head of CIA and
as head of the Intelligence Community.
All these themes arose in the 1970s, shaping the management agendas of
the DCI and other Community principals, creating new institutional
capabilities (e.g., in the Intelligence Community Staff), and forcing
intelligence budget and program decisions before the President and the full
members of the NSC for more serious attention than ever before.
Considerable progress was made in dealing with these challenges during the
1970s. During most of the 1980s, however, budgets went up sharply and there
was a fairly natural -- if perhaps unwise -- drop in attention to resource
efficiency at the Community level. Competitors for the marginal dollar
simply don't fight as hard when their budgets are growing.
But the environment of austerity and expanding tasks is returning. We
have to examine whether our mechanisms, particularly organizations within
SECRET
Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1
 Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1 25X1
and among the agencies for the most efficient resource management, are up to
the challenge. We also have to ask whether the oversight mechanisms which
have proliferated in the past two decades will be helpful or obstructive in
the quest for new levels of resource efficiency. This applies to oversight
within the Executive Branch (e.g., at NSC and 0MB), as well as to Congress.
Sources of Strength
As we look ahead into the 1990s, it is wise to emphasize a number of
assets or advantages available to the DCI as he faces tougher resource
management issues, especially at the Community level?.
First, we've been here before to some extent and we don't have to
reinvent the wheel. There are people in and out of government who know
the concepts, the vocabulary, and many of the issues that will arise in
this environment; they are on both sides of the political aisle.
The manpower expansion of the early 1980s during a business recession,
in CIA but other agencies as well, brought in.large numbers of unusually
well-educated and talented young people. Management of these people so
that the best ones stay in intelligence careers is itself a major
challenge. But they provide the DCI with two important levers for
attaining higher efficiencies. First, they are a pool of quality
intellect and motivation from which more skilled managers for the future
can be rapidly developed. Second, they permit a reduced work force to
result in a relatively more talented manpower pool in the Community than
resulted from similar RIFs in the 1970s.
Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1
 Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1 25X1
Finally, technology may offer some tools for enhancing resource
efficiency even in the domain of intelligence where it is so elusive..
Today, unlike the 1970s, ADP is ubiquitous even though it sometimes
seems chaotic. The masses of information that constitute the meat and
potatoes of intelligence move from the collector to the finished
publication, and even sometimes to the consumer himself,
electronically. Analysts and processors who are the best equipped of
"frontline" intelligence people to judge what the value of information
is are used to operating in an electronic data environment. We ought to
be able to use these conditions to design better tools for more
efficient resource management because we are better able to track what
we collect, where it goes and how it is used.
The period ahead should be viewed as a one of challenge full of
opportunity rather than threat for US intelligence. This is because, while
growing bigger during the last half decade, it also got better. There is
probably some flab around. But there are clear areas of improvement over
the 1970s on all sides, both in collection and analysis, in people and in
machinery. The key to success in the next phase will be to manage in ways
that preserve and build on accumulated strengths.
SECRET
Declassified in Part - Sanitized Copy Approved for Release 2013/04/09: CIA-RDP90T00435R000100090011-1