DOD business modernization efforts continue to fall short

It’s been an uphill battle to modernize the Defense Department’s endemic financial bookkeeping struggles, and it looks like the struggle is still underway, according to a new Government Accountability Office report.

Poor governance, implementation failures and inadequate inventory and manpower are among the chief reasons DOD has made limited progress in modernizing its incongruent and archaic business systems, the report said.

“Since 1995, GAO has designated DOD’s business systems modernization program as high risk, and it continues to do so today,” GAO reported. “While the department has initiated numerous activities aimed at addressing [business modernization mandates], it has been limited in its ability to demonstrate results.”

Since 2005, DOD has been required by that year’s that fiscal year’s National Defense Authorization Act to problems in DOD’s business systems and report annually to Congress on progress. Each year GAO has also reviewed the progress and made recommendations – some of which have been put in place, and some that continue to trouble the department.

For example, DOD has not implemented guidelines from GAO’s IT investment management framework since the auditor last reviewed the department in 2011, and hasn’t measured or reported results from a GAO-recommended review process.

In addition, DOD continues to describe ongoing certification plans and actions for updating business systems – $2.2 billion worth in modernization spending – but GAO stated that bases and approvals for the actions is supported only by limited information.

Perhaps one of the biggest problems faced by the Deputy Chief Management Office, tasked with the modernization efforts, is a dearth of manpower.

According to the report, the DCMO “lacks the full complement of staff it identified as needed to perform business systems modernization responsibilities” – including 41 percent of its positions remaining unfilled.

DOD officials, including Deputy Chief Management Officer Elizabeth McGrath, have defended their efforts and stipulated that progress has been made, including at an April hearing before Congress.

“Achieving this important objective at DOD is no routine task. It requires an enterprise-wide response and an effective strategy,” McGrath said in a testimony before the Senate Armed Services Committee. “Over the past year the department has taken a number of steps to improve its overarching business environment … [we have] continued to mature business transformation-related processes, architectural framework and governance that support our transition to a more modern and disciplined business environment.”

About the Author

Amber Corrin is a former staff writer for FCW and Defense Systems.

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Reader comments

Tue, Jun 5, 2012 Stilton49 DC area

This article seemed largely like a press release. Is there any reporting done at Wash Tech?

Tue, Jun 5, 2012 Cowboy Joe

One of the biggest differences between the public and private sector, is that when a private sector contractor fails to deliver to a private sector customer the contract ends, and sometimes there are even lawsuits and black listings against the provider. When a private sector company fails to deliver to a public sector customer to the tune of "$6B over budget and 31 years behind schedule" ... hey! It seems like bonuses all around, and double funded contract options to boot!

Tue, Jun 5, 2012

I agree if you do a good job for your employer you never get anywhere but if you screw up you will move up.

Mon, Jun 4, 2012 Christopher Hanks United States

A four-step lesson on the difference between government and the private sector: 1.As pointed out in the referenced Senate hearing in April on DOD financial management, the Department’s "Enterprise Resource Planning" efforts are cumulatively $6 billion over budget and 31 years behind schedule. 2.Elizabeth Mcgrath, the DOD’s Deputy Chief Management Officer, has (in effect) been doing the DCMO job for five years. The DCMO job came into existence in 2007. DOD created the position in response to Congressional demands for someone to take over full responsibility for turning around the Department’s big business IT systems efforts. Ms. McGrath was officially appointed as the first DCMO in July 2010, and before that she was the Acting DCMO or Assistant DCMO running the DCMO operation. 3. The Chief Risk Officer for JP Morgan Chase, Ms Ina Drew, was fired recently for overseeing an office that lost $2 billion for the bank. 4. Note the difference between the private sector and the government. In the private sector, when you fail to do your job and cost your employer a lot of money, you lose your job. In the government, when you fail to do your job and cost your employer a lot of money, Federal Computer Week does an article about you.

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