Defense IRM:

Strategy Needed for Logistics Information Technology Improvement Efforts

AIMD-97-6: Published: Nov 14, 1996. Publicly Released: Nov 14, 1996.

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Pursuant to a congressional request, GAO reviewed the Department of Defense's (DOD) efforts over the last 4 years to improve its information systems in the depot maintenance, materiel management, and transportation business areas, focusing on whether selected standard information systems will allow DOD to meet its business objective to dramatically improve the efficiency and effectiveness of its logistics operations.

GAO found that: (1) DOD's continued deployment of information systems using a migration strategy for the depot maintenance, materiel management, and transportation business areas will not likely produce the significant improvements originally envisioned; (2) for the most part, these efforts, which were intended to lay the groundwork for future dramatic change by first standardizing information systems and the related processes throughout DOD, are merely increasing the risk that the new systems that are deployed will not be significantly better or less costly to operate than the hundreds of logistics information systems already in place; (3) DOD itself has acknowledged that its migration systems strategy will not provide necessary dramatic improvements and cost reductions and is now emphasizing alternative ways of improving logistics business operations, such as turning to the private sector to carry out major logistics functions; (4) at the same time, however, it is continuing to deploy information systems selected under the migration strategy that are linked to the very same business functions it wishes to make more efficient and economical through outsourcing and/or privatization; (5) while GAO is encouraged that DOD is exploring alternative ways to improve its logistics operations, it is concerned that the current path needlessly risks wasting a substantial amount of the more than $7.7 billion DOD plans to invest in improving automated logistics systems; (6) DOD still has not taken the fundamental steps necessary to ensure that the automated systems it continues to deploy will yield a positive return on investment; (7) even as DOD embarks on its new improvement efforts, it has not yet sufficiently tied these new efforts to its overall business objectives through the use of a strategic investment strategy to ensure that the billions of dollars will be wisely spent; (8) such planning would be in keeping with best private- and government-sector practices as well as with new legislation which underscores the importance of strategic information planning for the efficient and effective use of information technology; and (9) without addressing these concerns, DOD's new improvement efforts, like the failed standard migration strategy, will proceed with little chance of achieving the objectives originally envisioned for substantial operational improvements and reduction in costs.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: To ensure that DOD optimizes its use of information technology to achieve its logistics Corporate Information Management (CIM) goals of dramatic business process improvement and operational cost reduction, the Secretary of Defense should direct that immediate cost-benefit analyses of each logistics migration system be undertaken and halt deployment of those that: (1) cannot be shown to have significant return-on-investment; (2) will not facilitate ongoing efforts to privatize logistics business functions; or (3) do not support efforts to achieve interoperability between and among business activities.

    Agency Affected: Department of Defense

    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: To ensure that DOD optimizes its use of information technology to achieve its logistics CIM goals of dramatic business process improvement and operational cost reduction, the Secretary of Defense should expedite development of a strategic information resources management plan that anchors DOD use of logistics information resources to its highest priority business objectives. The plan should conform with requirements established by the Government Performance and Results Act of 1993, the Paperwork Reduction Act of 1995, and the Clinger-Cohen Act of 1996.

    Agency Affected: Department of Defense

    Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

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