DOD agency sheds the paper trail

Just 15 months before Defense Department agencies must comply with a departmentwide paperless contracting mandate, last week the Army Space and Missile Defense Command (SMDC) announced it was the first DOD agency to complete the conversion.

The achievement represents the first tested enterprisewide use of DOD's Standard Procurement System (SPS), a $240 million departmentwide, automated acquisition system that DOD awarded in 1997 to American Management Systems Inc. Under the SPS contract, AMS will install its Procurement Desktop-Defense software package on approximately 46,000 desktops at more than 800 locations throughout DOD.

"This is a sea change from how we used to do things," said Mark Lumer, SMDC's principal assistant responsible for contracting. "With SPS we can get everything flowing concurrently, [and] we're not killing trees anymore."

The SMDC effort is a "major milestone" in DOD's paperless contracting efforts, said Mike Long, vice president and SPS program manager for AMS.

DOD's paperless contracting goals are part of DOD's overall Defense Reform Initiative unveiled last year by Vice President Al Gore and Secretary of Defense William Cohen. The department's re-engineering goals include the creation of a "paperless society by the year 2001," Cohen said, and the movement of all paper-based documentation and transactions to electronic media.

Speaking this month to students at the Defense Systems Management College, Jacques Gansler, undersecretary of Defense for acquisition and technology, reiterated DOD's commitment to more streamlined, paperless operations. "Our Year 2000 acquisition commitment to the vice president is to deliver new major defense systems to users in 25 percent less time.... We need dramatic reductions in cycle times," Gansler said.

SMDC volunteered to be DOD's "guinea pig" in December 1997 and invested $3 million in equipment upgrades to support the new architecture, Lumer said. SPS has been in operation since August and, according to Lumer, has improved the command's business processes. "Our [acquisition] lead times are 25 percent to 33 percent shorter, which means we can get equipment into the hands of troops faster," Lumer said.

However, Chip Mather, senior vice president of Acquisition Solutions Inc., said although the SMDC project sounds encouraging, he has not yet seen a paperless contracting system where the entire business process was re-engineered to support it. "To be truly paperless, they have to integrate [the system] and manage the data," Mather said. "I'm afraid [agencies] are just rushing to automate the paper."

Although similar projects are expected to save $30 million to $60 million a year throughout the Army, personnel reductions continue to be a sticky issue, Lumer said. Over the past 14 months, efficiencies and improvements to the business process introduced by SPS have allowed SMDC to reduce the size of its administrative support staff by one-third, Lumer said. And another reduction looms on the horizon, he said.

However, some industry observers say it is difficult to directly associate the introduction of the automated process with staff reductions. According to Bob Dornan, senior vice president of Federal Sources Inc., acquisition personnel reductions are not the result of automation but are the result of mandates issued by senior government officials in the administration, Congress and DOD.

"The directions [from the senior leadership] are clear," Dornan said. Although automation will allow the remaining acquisition personnel to "maintain their mission," agencies "still need to have enough intelligent people monitoring contract performance," he said.

Steven Kelman, Weatherhead Professor of Public Management at Harvard's Kennedy School of Government and former administrator of OMB's Office of Federal Procurement Policy, said work force reductions are driv-ing the government's efforts to find new and innovative ways to deal with the workload. "The work force reductions have already happened [and] are requiring agencies to cut back on their administrative costs," Kelman said.

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