On June 27, 1981, Flanagan reported to commissioning crew of USS Kidd (DDG-993) as the ship's first commanding officer. He had now advanced to the rank of captain. Flannagan commanded the guided missile destroyer—the lead ship of her class—on her first deployment to the Mediterranean Sea and the Indian Ocean.
On October 5, 1994, Flanagan was promoted to the rank of admiral and was assigned as Commander in Chief of the Atlantic Fleet. At the end of his tenure in this position, he was responsible for more than 200,000 Navy and Marine Corps personnel, 220 vessels, 1,500 aircraft, and 27 shore installations. Flanagan stepped down from commanding the Atlantic Fleet on December 20, 1996, and retired shortly thereafter after approximately thirty years of naval service.[5][6]