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A new type of holographic optical element combines some of the flexibility of computer-generated holograms with the high light efficiency of volume phase holograms to produce optical elements capable of arbitrary illumination transformations with nearly 100% light efficiency. The optical element is recorded by subdividing a volume hologram film surface into numerous small areas (facets), each of which is individually exposed. A final optical system consisting of two dichromated gelatin holograms in series is demonstrated. The first hologram spatially redistributes the incident light, and the second hologram produces a desired phase front on the redistributed light.