Achieving clean audits

Army and Air Force turn to SAP and Oracle for new financials

The Army and Air Force will use SAP and Oracle products to build the services' new financial systems. The Army will use mySAP enterprise resource planning software and the Oracle9i Database to build the General Fund Enterprise Business System (GFEBS). The Air Force will use Oracle's E-Business Suite and Database 10g to develop the Defense Enterprise Accounting and Management System (DEAMS).

SAP works well for GFEBS because many Army logistics and combat support systems are based on the company's software, said Cherie Smith, the service's project officer for the system. The Logistics Modernization Program and the Global Combat Support System-Army, for example, use SAP.

The Air Force selected DEAMS because several military transportation systems run on the company's software, said Wayne Bobby, vice president of finance and administration solutions at Oracle's Public Sector business unit. He cited systems at the Navy's Military Sealift Command and the Army's Military Surface Deployment and Distribution Command.

GFEBS and DEAMS are part of the Defense Department's multibillion-dollar Business Management Modernization Program. They are expected to reduce the number of military financial systems and provide comprehensive accounting data to achieve clean audits and provide DOD executives with the data necessary to effectively manage the agency.

The Army and the Air Force took different contracting approaches, even though they chose solutions from vendors participating in DOD's Enterprise Software Initiative.

For GFEBS, the Army chose to award one contract to a systems integrator that recommended SAP. For DEAMS, the Air Force opted for two deals: one for the application software and another for the systems integrator. The Air Force will award the systems integration contract later this year.

In June, the Army awarded a $437 million hybrid contract containing cost reimbursable and fixed-price line items to Accenture to develop GFEBS. The system will replace three existing ones that run on mainframe computers: the Standard Army Finance System, the Defense Joint Accounting System, and the Standard Operation and Maintenance Army Research and Development System.

The service also wrote a contract that gives it the power to cancel the deal if the company does not meet program goals. "The Army has structured the GFEBS task order to allow the Army to discontinue performance by not exercising options in the event that performance is problematic," Smith said.

She said Accenture's decision to share in the program's risk and adhere to performance-based contracting helped the company win the contract.

"Accenture conducted a very effective demonstration during the evaluation process, and it has manifested its commitment to the success of GFEBS with a very strong quality assurance surveillance plan," she said.

The Army and Air Force will follow similar build-a-little, test-a-little approaches to implementing the systems.

Accenture will begin work on a pilot project at Fort Jackson, S.C., on the Army's real property inventory. "After the successful demonstration of this initial release, we then will conduct a common global design to incorporate all of the general fund requirements across the total Army and the Defense Finance and Accounting Service," Smith said.

The company will then deploy GFEBS at Army installations here and abroad that use the service's financial systems. The military could install the systems later at the Missile Defense Agency and the Defense Advanced Research Projects Agency.

"GFEBS will be Web-based and is intended to support more than 79,000 users in more than 200 locations around the world," said Eric Stange, managing partner of Accenture's Defense and Homeland Security unit. "The system will be designed to integrate seamlessly into the Army's current information technology environment."

By December 2006, the winning systems integrator for DEAMS is expected to provide an initial Oracle systems capability at Air Mobility Command. The Air Force could then decide to exercise contract options to expand the system to other service bases and DOD agencies, Bobby said.

Building blocks for back-office systems

The Army and Air Force are building new financial systems to improve accounting, achieve clean audits and consolidate accounting systems. They plan to use enterprise resource planning (ERP) software components to develop the new systems.

The products include:

n The Army's General Fund Enterprise Business System, which will use SAP's mySAP ERP applications running on the Oracle9i Database.

n The Air Force's Defense Enterprise Accounting and Management System, which will use the Oracle E-Business Suite running on Oracle Database 10g.

Sources: Army and Air Force

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