August 19, 2015:
Since the 1990s there have been increasingly open (public) complaints from users about poor quality work from the U.S. Department of Defense intelligence agencies. This all began in the late 1940s when the CIA was established to coordinate all of the U.S.'s intelligence gathering activities. At that point there began a low level war between the CIA and the Department of Defense. This is because some 80 percent of the intelligence gathered and analyzed is used by the Department of Defense. This is an old problem. In the early 1960s, the Department of Defense created its own "CIA" (the Defense Intelligence Agency, or DIA) to coordinate the efforts of its own considerable intelligence gathering activities, and to handle relations with the CIA. But the Department of Defense increasingly saw the relationship with the CIA as one of the tail wagging the dog. As the main user of intelligence, the Department of Defense was increasingly feuding with the CIA over what to look for and how fast the stuff it took (usually too long) for intel to be delivered to the troops that needed it. After the 1991 Gulf War this resulted in scathing public testimony before Congress by Army generals complaining that they got vital information from the CIA either too late, or never. The complaints were now very much a public matter.
Despite several well publicized and lavishly funded efforts since the 1990s to fix the problem there has not been much improvement. For example it was recently noted that when Shia rebels in Yemen launched SCUD ballistic missiles against Saudi Arabia reports of the incident arrived much more quickly via twitter and other social media than via the very expensive (billions year to operate) Department of Defense intelligence system (including space satellites and many agents on the ground). This prompted the Department of Defense to reveal that a recent study of the DIA found much that was wrong, unfortunately most of the specific problems were classified. So it will be very difficult to ever find out if those problems were addressed much less fixed. One item that could be made public was the turnover rate of DIA staff. It’s a very low five percent a year. That is low compared to commercial intelligence operations and even the CIA. Then again the CIA was created right after World War II by intelligence veterans with wartime experience. These men and women understood that higher turnover was essential and Congress agreed to free the CIA of civil service rules that might interfere with getting rid of unproductive employees. The Department of Defense bureaucracy was always different and the DIA followed a more conventional civil service standard (that made it very difficult to get rid of unproductive staff).
There have also been other problems besides turnover and personnel quality. For example the CIA (which deploys spies overseas) and FBI (which goes after foreign spies in the U.S.) often have disputes over spies that interfere with operations. Early on, the FBI resented the CIA as the new kid on the block. There was also a culture clash because the CIA had a more Ivy League atmosphere, while the FBI saw themselves as "supercops" (although the key "special agents" of the FBI had long been required to be college graduates.) Most of the initial CIA leadership came from the World War II OSS, which heavily recruited Ivy League schools and Wall Street for the "best and the brightest" to lead the intelligence effort during the war. When the DIA showed up in the 1960s the CIA and FBI both jumped on the newcomer as more needless competition.
Aside from all these problems, the big one is that the "Director of Central Intelligence" was long the head of the CIA, but didin't really direct all intelligence activities in the U.S. government, especially the increasing intelligence work done by various Department of Defense operations as well as the FBI, the State Department, the DEA and so on. The failure to prevent the September 11, 2001 attacks put a spotlight on this problem, and no one has an easy solution. The most popular fix that made it into law was to create a new "Director of Intelligence" that had the power to order all intelligence operations to work together. This rarely works, and most people in Washington know it. But "something must be done," and creating a new bureaucracy is a favorite fix. So instead of a fix to this mess we have a new layer of bureaucracy to help resist any real change.