DOD Systems Modernization:

Uncertain Joint Use and Marginal Expected Value of Military Asset Deployment System Warrant Reassessment of Planned Investment

GAO-06-171: Published: Dec 15, 2005. Publicly Released: Dec 15, 2005.

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Because of the importance of the Department of Defense's (DOD) adherence to disciplined information technology (IT) acquisition processes in successfully modernizing its business systems, GAO was asked to determine whether the Transportation Coordinators' Automated Information for Movements System II (TC-AIMS II) program is being managed according to important aspects of DOD's acquisition policies and guidance, as well as other relevant acquisition management best practices. TC-AIMS II was initiated in 1995 as a joint services system to help manage force and equipment movements within the United States and abroad. The U.S. Department of the Army has the lead responsibility for managing the system's acquisition and estimates its life-cycle cost to be $1.7 billion over 25 years.

The Army has managed the TC-AIMS II program in accordance with some, but not all, key aspects of DOD's system acquisition management policies and related guidance. These policies and guidance are intended to reasonably ensure that investment in a given IT system represents the right solution to fill a mission need--and, if it does, that acquisition and deployment of the system are handled in a manner that maximizes the chances of delivering defined system capabilities on time and within budget. The Army has not managed the program in accordance with those DOD policies and related guidance, including related federal and other best practice guidance, that are intended to reasonably ensure that a proposed system is the right solution to meet mission needs. Specifically, the Army has not economically justified its investment in TC-AIMS II on the basis of reliable estimates of costs and benefits. For example, the most recent economic justification included cost and benefit estimates predicated on all four military services using the system. However, two services (U.S. Department of the Air Force and U.S. Marine Corps) have stated that they do not intend to use it. The Army has not invested in TC-AIMS II within the context of a well-defined enterprise architecture, which is an institutional blueprint to control program investment decisions in a way that promotes interoperability and reduces redundancy among systems. The Army has instead focused on aligning TC-AIMS II with its logistics architecture; this means that even though TC-AIMS II is intended to be a DOD-wide program, it has been based on a service-specific architecture rather than a DOD-wide architecture. As a result, it may not properly fit within departmentwide plans. To its credit, the Army has largely managed the program in accordance with key policies and related guidance that are intended to reasonably ensure that the acquisition and deployment of a given system are handled in a manner that maximizes the chances of delivering defined capabilities on time and within budget. However, some aspects of this policy and guidance have not been followed. For example, the Army has not fully implemented risk management and has not adhered to a key feature of performance-based contracting. Reasons the Army cited for not following policies and guidance ranged from management inattention to lack of training. As a result, the Army, among other things, does not know whether the system is the right solution. Until this uncertainty and the previously discussed problems are addressed, it will remain unclear whether further planned investment in TC-AIMS II is warranted, and certain aspects of the program's management will be limited.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: Consistent with our recommendation, DOD evaluated the investment in July 2006 as part of a major milestone review and decided to cancel investment in the last two phases (referred to as blocks by DOD), stating that this capability would be satisfied by alternate solutions.

    Recommendation: The Secretary of Defense should direct the Secretary of the Army to present the results of these analyses to the Deputy Secretary of Defense, or his designee, and seek a departmental decision on how best to proceed with the program. Until this is done, the Secretary of Defense should direct the Secretary of the Army to limit future investment in already deployed applications to essential operation and maintenance activities and only developmental activities deemed essential to national security needs.

    Agency Affected: Department of Defense

  2. Status: Closed - Implemented

    Comments: According to a December 15, 2006, memorandum from the Office of the Assistant Secretary of Defense for Networks and Information Integration (OASD/NII), the U.S. Transportation Command (USTRANSCOM) conducted an analysis of TC-AIMS II and decided to cancel investment in the system after it had completed the increment currently under development at the time (Block 3). This decision was documented in an acquisition decision memorandum, dated July 5, 2006. The memo also stated that USTRANSCOM evaluated alignment of its investments with the architecture and determined that TC-AIMS IT was duplicative of planned capability to be provided through another program (federated WEB Services). The memo further noted that the USTRANSCOM commander briefed this federated approach and received approval from the Defense Business Systems Modernization Committee, which is chaired by the Deputy Secretary of Defense in May 2006, and is responsible for, among other things, approving business systems alignment with DOD's business enterprise architecture.

    Recommendation: The Secretary of Defense should direct the Secretary of the Army to determine if continued investment in TC-AIMS II as planned represents a prudent use of the department's limited resources. To accomplish this, the Secretary of the Army should collaborate with the Undersecretary of Defense for Acquisition, Technology, and Logistics and the Under Secretary of Defense (Comptroller) to ensure that TC-AIMS II is adequately aligned with the evolving DOD business enterprise architecture.

    Agency Affected: Department of Defense

  3. Status: Closed - Implemented

    Comments: According to a December 15, 2006, memorandum from the Office of the Assistant Secretary of Defense for Networks and Information Integration (OASD/NII), the U.S. Transportation Command conducted an analysis of TC-AIMS II and decided to cancel investment in the system after it had completed the increment currently under development at the time (Block 3). This decision was documented in an acquisition decision memorandum, dated July 5, 2006. The memo also states that if future needs required the development of the additional increments, a full cost analysis would be completed by the Army (since the Army Acquisition Executive was designated as the milestone decision authority) in accordance with this recommendation.

    Recommendation: The Secretary of Defense should direct the Secretary of the Army to determine if continued investment in TC-AIMS II as planned represents a prudent use of the department's limited resources. To accomplish this, the Secretary of the Army should ensure that development of this economic analysis (1) complies with cost-estimating best practices and relevant Office of Management and Budget cost benefit guidance, (2) incorporates available data on whether deployed TC-AIMS II capabilities are actually producing benefits, and (3) addresses that the Air Force and Marines are not planning to use the system.

    Agency Affected: Department of Defense

  4. Status: Closed - Implemented

    Comments: According to a December 15, 2006, memorandum from the Office of the Assistant Secretary of Defense for Networks and Information Integration (OASD/NII), the U.S. Transportation Command conducted an analysis of TC-AIMS II and decided to cancel investment in the system after it had completed the increment currently under development at the time (Block 3). This decision was documented in an acquisition decision memorandum, dated July 5, 2006. The memo also states that if future needs required the development of the additional increments, a full cost analysis would be completed by the Army (since the Army Acquisition Executive was designated as the milestone decision authority) in accordance with this recommendation.

    Recommendation: The Secretary of Defense should direct the Secretary of the Army to determine if continued investment in TC-AIMS II as planned represents a prudent use of the department's limited resources. To accomplish this, the Secretary of the Army should collaborate with the Office of the Assistant Secretary of Defense for Networks and Information Integration/Chief Information Officer, the Office of Program Analysis and Evaluation, and the Army Cost Analysis Division to prepare a reliable economic analysis.

    Agency Affected: Department of Defense

  5. Status: Closed - Implemented

    Comments: According to a December 15, 2006, memorandum from the Office of the Assistant Secretary of Defense for Networks and Information Integration (OASD/NII), the U.S. Transportation Command conducted an assessment of TC-AIMS II and decided to cancel investment in the system after it had completed the increment currently under development at the time (Block 3). This decision was documented in an acquisition decision memorandum, dated July 5, 2006. Among other things, the OASD/NII memorandum stated that DOD withheld part of the contractor's performance-based fee and replaced program leadership as part of efforts to address program risks and otherwise comply with our recommendations.

    Recommendation: If--on the basis of reliable data--a decision is made to further develop TC-AIMS II, the Secretary of Defense should direct the Secretary of the Army to ensure that the program implements effective program management activities related to risk management and performance-based contracting.

    Agency Affected: Department of Defense

 

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