DOD business systems under fire -- again

A GAO report, echoing longstanding criticisms, diagnoses the causes of DOD's sputtering modernization progress.

room of computers

The Defense Department's struggle to take its business systems enterprisewide and into the 21st century continues. Once again, the Government Accountability Office has issued a report criticizing the modernization program.

If it sounds familiar, it's because GAO designated DOD’s multibillion-dollar business systems modernization program as high risk in 1995 and since then has provided recommendations for DOD to strengthen its approach and reduce risks. Provisions in the fiscal 2005 National Defense Authorization Act mandated transition plans for modernization and DOD-wide business enterprise infrastructure, but the department continues to struggle, according to the latest report.

"Even though DOD has spent more than 10 years and at least $379 million on its business enterprise architecture, its ability to use the architecture to guide and constrain investments has been limited by, among other things, the lack of a detailed plan," the report's authors wrote. "The department's latest version of its transition plan included data on more than 1,200 covered defense business systems; however, important content, such as time-phased milestones and performance measures, is still needed to address the act's requirements."

The report also outlines DOD's troubles in investment management and accountability structure, compliance in reengineering and realignment of its business processes, and management of workforce needs.

"Collectively, these limitations put the billions of dollars spent annually on approximately 2,100 business system investments that support DOD functions at risk," the report states. "GAO's previous recommendations to the department have been aimed at accomplishing these and other activities related to the business systems modernization. However, to date, the department has not implemented 29 of the 63 recommendations that GAO has made in these areas."

According to the report, officials have blamed three major factors for at least some of the troubles. They are recent turnover, changes to requirements that expand the number of systems subject to certification, and a short time frame for implementing an investment review process for DOD's portfolio of business systems and processes.

In the past, officials have also pointed to DOD's many legacy business systems and the efforts to upgrade and replace them as major factors in their struggles to bring DOD's backend systems up to speed.

"Today, DOD is implementing multiple business systems across the military departments and defense agencies to serve as the business backbone of their operations," wrote Robert Hale, DOD's comptroller, and Elizabeth McGrath, DOD's deputy chief management officer, in joint testimony for Congress in September 2012. "Each of these implementations is at a different stage of its life cycle and most have experienced challenges as they have moved from design to implementation. These challenges have led to cost and schedule overruns of varying degrees, and include issues such as insufficient business process reengineering being conducted early and upfront in their life cycles, data quality/cleansing, and changing scope and requirements."

Hale and McGrath also testified that progress was being made in DOD's business systems management, which includes mandates for reaching audit-readiness by 2014.

"There are significant challenges, but they are not insurmountable," they wrote in their joint testimony. "We are making meaningful progress."

Although GAO did recognize some steps forward in the latest report, the authors reiterated the need for DOD to follow through with the watchdog agency's counsel.

"Until DOD implements GAO recommendations and addresses the weaknesses described in this report, it will be challenged in its ability to manage the billions of dollars invested annually in modernizing its business system investments," the report states.

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