Pentagon's EMall strategy questioned
- By Dan Verton
- Mar 02, 2000
The Defense Department, in a hurry to adopt commercial best-business practices,
in 1998 established an online mall for purchasing supplies despite significant
shortcomings in the system that made the military reluctant to use it.
An internal Pentagon Inspector General report, finalized in December 1999
as DOD and the rest of the government struggled with last-minute Year 2000
preparations, questioned the "appropriateness" of DOD's decision to start
EMall on Jan. 29, 1998.
According to the report, "DOD Electronic Mall Implementation Planning,"
the decision to move forward with the EMall was made despite known barriers
to the system's use, including the inability of legacy systems to interface
with the EMall, duplication of General Services Administration supply programs,
inadequate comparison shopping capabilities, the inability to ship EMall
products directly to customers, lack of authorization control on orders
and slow response time for searching and ordering.
The problems were significant enough that the Army did not approve its organizations
to use the EMall as a supply source, according to the report. Likewise,
the Air Force expressed reluctance to allow its organizations to use the
EMall and found it faster to buy items locally, the report stated. The Navy
and Marine Corps also complained of similar problems, according to the report.
The report also stated that there was no way for DOD organizations to know
if they were paying bank credit card fees twice because vendors had not
informed buyers if bank charges were included in the price of their products.
DOD established the EMall within the Defense Logistics Agency's Joint Electronic
Commerce Program Office as a single Defensewide point of entry for all DOD
electronic purchasing catalogs. However, studies conducted months before
the system was placed into operation warned EMall managers that "DLA should
be very certain that all facets of the system are fully operational." Another
study warned, "It takes 30 years to get a customer and 30 seconds to lose
one. The EMall must be as near perfect as possible before 100 percent market
In a Feb. 7 memorandum to the IG, DLA director Army Lt. Gen. Henry T. Glisson
argued that extensive work had been completed on the EMall since the IG
audit was conducted. "The decision to go online before all issues are resolved
is a program management judgment," the letter stated, adding that any delay
would have deprived DOD of EMall's benefits. "It is unrealistic to think
that all problems could have been resolved in advance of implementation,
especially in light of the rapidly changing environment in which the EMall