Fact Sheet: Business Transformation Overview
A CLEAR MISSION
Transform business operations to achieve improved warfighter support
while enabling financial accountability across the Department of
Defense.
“
It is not, in the end, about business practices, nor is it the
goal to improve figures on the bottom line. It’s about the
security of the United States of America. And let there be no mistake,
it is a matter of life and death. Our job is defending America,
and if we cannot change the way we do business then we cannot do
our job well, and we must.”
—Secretary of Defense,
Donald H. Rumsfeld
September 10, 2001
As our nation’s security challenges are becoming more complex,
our military is transforming into an increasingly agile joint
force that is dominant across the full spectrum of military operations
in peace and war. The highly flexible, yet precise, Armed Forces
of the 21st Century require an equally flexible and responsive
business and financial support infrastructure that is capable
of adapting to ever-changing conditions.
Transformation Objectives
Business transformation in the Department of Defense (DoD) is being
driven by a series of strategic objectives, each of which illustrates a different aspect
of the overall challenge:
- Support the Joint Warfighting Capability of the DoD — Joint
military requirements are driving the need for greater commonality
and integration of business and financial operations. The Department’s
business infrastructure must rapidly respond to the warfighting community
and be compatible with the global, networked military it supports.
- Enable Rapid Access to Information for Strategic Decisions — Actionable
information will accelerate leaders’ ability to make better
decisions that impact human resource capabilities; the condition,
status, and location of assets; and how funds are invested
for the warfighting mission.
- Reduce the Cost of Defense Business Operations — Streamlined
business operations will enable decision makers to deal with growing
pressures on resources and ensure every defense dollar is optimally
applied for long-term mission effectiveness.
- Improve Financial Stewardship to the American People — Improving
the effectiveness and efficiency of business processes will enable
the Department to better comply with federal accountability laws
and regulations. Integrated processes will allow accounting transactions
to be traced to their source, yielding consistent financial transparency.
Aligning Business Operations to Warfighter Needs
To support the Department’s process of identifying joint needs,
analyzing capability gaps, and implementing improvements, the DoD
Business Mission Area (BMA) is aligned to the Warfighting mission.
This new unifying framework is a capabilities-based approach to enterprise
business planning, resourcing, and execution, which consists of five
integrated Core Business Missions (CBMs):
- Human Resources Management
- Weapon System Lifecycle Management
- Materiel Supply & Service Management
- Real Property and Installations Lifecycle Management
- Financial Management
Each CBM is led by the appropriate Under Secretary of Defense (i.e.,
Principal Staff Assistants, or PSAs) with flag-level, uniformed representation.
As CBM “owners,” the PSAs will ensure the alignment of
transformation investments to end-to-end operational support improvements.
Flag-level, uniformed representation on each CBM support organization
leadership team ensures that Service perspectives are considered
during all CBM decision making.
A Realistic Plan for Achievable Change
In transforming its business operations, DoD is dealing with many
of the same issues that major corporations confront. As it is not
economically or organizationally possible to make sweeping changes
all at once, successful transformation focuses on a clear set of
priorities aligned to the most urgent customer needs. Additionally,
change must be driven from the top with clear accountability
for those functions, systems, and standards that will be centralized.
The DoD Enterprise and Component partnership has defined a clear
understanding of the expansive business and financial systems environment
and of where opportunities exist to leverage Information Technology
(IT) assets to deliver improved capabilities to the warfighter. System
reductions will be a by-product of successful transformation. Guided
by a structured approach of focusing on priority capabilities, the
transition to a modern defense business infrastructure is fully underway.
Significant elements are highlighted below.
A Focus on Priorities
The Department has identified and focused its transformation efforts
on six strategic Business Enterprise Priorities that will
strengthen support to our Armed Forces and the Components that serve
them. The initial set of Business Enterprise Priorities, listed below, will yield significant
improvements:
- Personnel Visibility
- Acquisition Visibility
- Common Supplier Engagement
- Materiel Visibility
- Real Property Accountability
- Financial Visibility
These six priorities will provide enduring improvements to the
Department’s business infrastructure which will benefit the
warfighter, while continuously improving financial transparency
and auditability. The Components are supporting these priorities by transforming
their business practices and systems based on the DoD Business
Enterprise Architecture (BEA) and Enterprise Transition Plan (ETP). Additionally, Components develop strategies, schedules, and budgets and define Business Capabilities and Component priorities in their transition plans, which are then incorporated into the DoD-wide ETP. The Business Enterprise Priorities —and the detailed plans for achieving them—plus the individual Component priorities are all aligned in the ETP. The ETP summarizes planning information for selected programs that support the Business Enterprise Priorities and for Component programs that support Component priorities.
Proper Alignment of Authority and Accountability
Defense business transformation leverages the organizational strengths
of the individual Services and Defense Agencies. Through tiered
accountability, DoD is quickly building out enterprise-wide functionality
which includes data standards, business rules, specific systems,
and an associated layer of interfaces for the Components. These
standards, which are established through joint cooperation, represent
the “rules of engagement” to which all DoD Components
must adhere. While the Department is not dictating how to transform,
it is ensuring that each Component’s transformational program
increases DoD’s ability to reap the benefits of improved
information exchange across organizational boundaries.
Architecture as a Tool, Not an End
Transformation is focused on delivering improved business capabilities
rather than the management of individual IT systems. This process
is being guided by the DoD BEA and associated ETP designed to address
the set of well-defined priorities for the DoD enterprise. Within
the DoD Business Mission Area, the BEA and Component Enterprise
Architectures provide required guidance as part of a federated
approach.