A description of a new planning and programming process, initiated within the Department of Defense in early 1961. The significant feature of this process is the approach that is taken to decisionmaking and control in the vital area of defense expenditures. Planning is considered in long-range terms of missions, forces, and weapon systems (i.e., resource outputs) rather than in terms of the standard appropriation categories of procurement, construction, and personnel (i.e., resource inputs). The author discusses the implications of the new planning process, in the Department and throughout the Federal Government, especially as it removes the obvious drawbacks of ad hoc decisions made during budget review. Although in its first two years the new process has had significant effects on financial management, it has left the traditional fiscal process relatively unchanged.