Initiative Council Seeks Best Business Practices

Air Force Lt. Gen. Joe Wehrle says he's had "painful experiences" in the past with initiatives to improve the military's business practices. "Some of those initiatives met with what we would call "dubious success," he told reporters here March 26. But, he added, "That's not the case here."

Wehrle chairs the executive steering committee of the Business Initiative Council, formed last June by Defense Secretary Donald H. Rumsfeld. The service secretaries, several undersecretaries and the vice chairman of the Joint Chiefs of Staff are on the council at large, chaired by Pete Aldridge, undersecretary of defense for acquisition, technology and logistics.

The council is charged to identify better and smarter ways to do business and to find ways to reduce costs and eliminate duplication.

Wehrle said the big incentive that makes the council process different from others is that the services keep savings they identify through BIC initiatives. They're allowed to reallocate the money to higher priorities, he added.

Council initiatives go beyond saving money, he noted. They also may involve reducing production time, streamlining processes, accelerating decision making, and other things that help get jobs done better and quicker.

The Navy handled the council's responsibilities during Phase 1. The Air Force took over for Phase 2 in October. At the end of March, Air Force passes lead service responsibilities to the Army for Phase 3.

"Secretary Aldridge gave us specific direction to be action-focused and to look broadly across the Department of Defense to identify good ideas, anywhere they are, and get them implemented," Wehrle said. "I think we've done a very good job of doing that."

The program has "great buy-in" from the field, he noted. "It's ideas we've collected from the field and we've elevated. We found out over time that the people that question why are we doing what we're doing are usually the people who are turning the wrench, not somebody that's stationed up here at the Pentagon."

The council is "going after every good idea, leaving nothing off the table," the general said. "We're focused on a spiral development process where we take and implement one idea and then develop spin-offs from that same initiative."

Ron Orr, chairman of BIC's executive directors, updated three of the 10 initiatives the council approved during Phase 1: recovery auditing, electronic invoicing and receipting, and enterprise software initiative. (Transcript available at http//www.defenselink.mil/transcripts/2001/t11072001_t1107bic.html.)

• Recovery auditing involves using contract contingency fee audit services to identify and recover overpayments for goods and services bought with working capital funds. The initiative is on schedule and implementation is slated for the end of fiscal 2002.
• Electronic invoice and receipt processing addresses the manual system now in place for receiving goods and processing invoices. Officials intend to implement this initiative to improve the cycle time and reduce errors. They plan to implement a new system this fiscal year with benefits beginning next fiscal year.
• The enterprise software initiative is expected to streamline the acquisition of commercially available software by buying defensewide licenses to achieve volume savings. The service secretaries have provided funding to develop a DoD software asset management process that will enhance the enterprise software initiative Web site.

"As the cell phone industry matures, there are many opportunities to take advantage of the great deals and manage this service more smartly," he said. The council hopes to negotiate lower-priced contracts by assigning cell phone users into appropriate pool groups.

Orr said he rarely travels but needs to be in touch 24 hours a day when he does -- even so, he doesn't use all the cell phone minutes allotted to him. Wehrle, on the other hand, travels more frequently and may at times exceed his allotment.

"What we want to do is pool, just like they do families, and have savings," Orr said. "We're going to begin to work this in two regions where we have a large military presence and could save considerable taxpayer dollars." Officials are also looking at streamlining the military's process for disposing of information technology equipment. At present, the Defense Department has two different processes, one for IT equipment and the other for every other piece of equipment in the military. Each is handled by a different agency. Consolidation might gain efficiencies, Orr said.

Officials are also looking at how the department can optimize professional continuing education -- the services duplicate each other by teaching nondegree courses 20 weeks long or less that are not service-specific in content.

The services each have a resident instructors course offered at four separate locations, Orr said. Consolidating such training in one location could be more efficient, he remarked.

After the council approves an initiative, Orr pointed out, defense officials set a firm implementation plan. Part of this plan is to set milestones and measures used to assess the effectiveness of reform, he said.

"We consistently track our progress on the milestones outlined and the implementation plan," Orr continued. "What we want to do is not just approve initiatives, but actually implement them." The council also avoids taking anticipated savings in advance, he said.

"This is a mistake we often made in the past, where we took a certain amount of savings. And then, when the savings didn't materialize, we ended up robbing and breaking other programs to cover the deficit."

Initiatives can work because the services stand to harvest savings and put them where they're needed, he said. But the incentives have to be real, he added.