Key Issues > DOD Business Systems Modernization

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DOD Business Systems Modernization

The Department of Defense (DOD) spends billions of dollars each year to acquire modern systems to achieve its business transformation goals, but has not fully defined and established a family of business system modernization management controls. These controls are vital to ensuring that DOD can effectively and efficiently manage an undertaking with the size, complexity, and significance of its business systems modernization, and minimize the associated risks.

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For decades, DOD has been attempting to modernize about 2,200 business systems, which are supported by billions of dollars in annual expenditures that are intended to support business functions and operations. Recommendations aimed at strengthening DOD’s institutional approach to modernization and reducing the risks associated with key investments include

developing and using a business enterprise architecture (BEA) modernization blueprint,
establishing effective investment management controls to guide and constrain DOD’s multi-billion dollar business systems environment, and
ensuring that DOD follows best practices when acquiring information technology systems and services.

DOD has made progress implementing key institutional modernization management controls; however, more needs to be done. For example, at the institutional level, DOD needs to

extend (federate) its corporate business enterprise architecture and related transition plan to its component organizations and ensure that it reflects the department's complete investment portfolio, and
evolve its corporate and component business system investment management processes and institutionalize these processes at all levels of the organization.

For specific programs, DOD needs to

ensure that the thousands of DOD business system modernization and information technology (IT) programs and projects employ program management rigor and discipline, including practices such as:
- economically justifying investments on the basis of reliable estimates of future costs and benefits,
- selecting and controlling investments within the context of an enterprise architecture, and
- effectively conducting key acquisition functions, including requirements management, risk management, test management, performance management, and contract management

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