DOD Business Systems Modernization:

Additional Enhancements Are Needed for Army Business System Schedule and Cost Estimates to Fully Meet Best Practices

GAO-14-470: Published: Sep 30, 2014. Publicly Released: Oct 30, 2014.

Additional Materials:

Contact:

Asif A. Khan
(202) 512-9869
khana@gao.gov

 

Nabajyoti Barkakati, Ph.D.
(202) 512-4499
barkakatin@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

What GAO Found

The Army made some improvements to its schedule and cost estimates that supported the December 2012 full deployment decision for the Global Combat Support System-Army (GCSS-Army); however, the schedule and cost estimates did not fully meet best practices. GAO found that the schedule substantially met the credibility and control characteristics for developing a high-quality and reliable schedule. For example, the schedule was horizontally integrated, which means that it links products and outcomes with other associated sequenced activities. In addition, the GCSS-Army program management officials followed general guidelines for updating the schedule on a regular basis. GAO found that the schedule partially met the comprehensiveness and construction characteristics for a reliable schedule. Specifically, resources were not assigned to specific activities, and the schedule lacked a valid critical path, preventing management from focusing on the activities most likely to have detrimental effects on key program milestones if not completed as planned. By incorporating best practices for developing a reliable schedule, the Department of Defense (DOD) would increase the probability of completing the GCSS-Army program by the projected date.

Extent to Which Global Combat Support System-Army Schedule Met Best Practices

Characteristic

Assessment

Comprehensive

Partially met

Well-constructed

Partially met

Credible

Substantially met

Controlled

Substantially met

Source: GAO analysis based on information provided by the Army. | GAO-14-470

GAO found that the GCSS-Army cost estimate fully or substantially met the comprehensiveness, documentation, and accuracy characteristics of a high-quality and reliable cost estimate. For example, the cost estimate included both government and contractor costs for the program over its life cycle, provided documentation that substantially described detailed calculations used to derive each element's cost, and was adjusted for inflation. In addition, GAO found that the cost estimate partially met the credibility characteristic of a reliable cost estimate. Although program management officials provided a cost model that discussed a limited risk analysis, the results of the risk and uncertainty analysis were not documented. Incorporating best practices would help ensure that DOD has a reliable cost estimate that provides the basis for effective resource allocation, proactive course correction when warranted, and accountability for results.

Extent to Which Global Combat Support System-Army Cost Estimate Met Best Practices

Characteristic

Assessment

Comprehensive

Fully met

Well-documented

Substantially met

Accurate

Substantially met

Credible

Partially met

Source: GAO analysis based on information provided by the Army. | GAO-14-470

Why GAO Did This Study

DOD officials have stated that the implementation of enterprise resource planning systems, such as GCSS-Army, is critical to the department's goal of correcting financial management deficiencies and ensuring that its financial statements are validated as audit ready by September 30, 2017, as called for by the National Defense Authorization Act for Fiscal Year 2010.

GAO was asked to review the schedule and cost estimates for selected DOD systems. This report addresses the extent to which the schedule and cost estimates for GCSS-Army were prepared consistent with GAO's Schedule and Cost Guides. The schedule and cost estimates are designed to cover GCSS-Army implementation through 2017.

GAO assessed the schedule and cost estimates that supported DOD's December 2012 full deployment decision, which granted approval for GCSS-Army to be deployed for operational use to all remaining locations. GAO also met with GCSS-Army program officials, including lead schedulers and cost estimators.

What GAO Recommends

GAO is making two recommendations aimed at improving the Army's implementation of schedule and cost best practices for GCSS-Army. DOD concurred, but the completed actions it described related to the cost estimate were not fully responsive to GAO's recommendation. GAO continues to believe that fully incorporating best practices in the cost estimate would help improve its reliability.

For more information, contact Asif A. Khan at (202) 512-9869 or khana@gao.gov or Nabajyoti Barkakati at (202) 512-4499 or barkakatin@gao.gov.

Recommendations for Executive Action

  1. Status: Open

    Comments: We are in the process of obtaining an updated integrated master schedule from DOD to determine if Army fully incorporated best practices. As of June 2017,Army officials told us that the integrated master schedule and revised cost estimate will not be available until December 2017. This recommendation remains open.

    Recommendation: To help improve the implementation of GCSS-Army, the Secretary of the Army should ensure that the Under Secretary of the Army, in his capacity as the Chief Management Officer, directs the GCSS-Army Program Management Office to develop an updated schedule that fully incorporates best practices, including (1) assigning resources to all activities, (2) establishing durations of all activities, (3) confirming that the critical path is valid, and (4) ensuring reasonable total float.

    Agency Affected: Department of Defense: Department of the Army

  2. Status: Open

    Comments: We are in the process of obtaining an updated cost estimate from DOD to determine if Army fully incorporated best practices. As of June 2017, Army officials told us that the integrated master schedule and revised cost estimate will not be available until December 2017. This recommendation remains open.

    Recommendation: To help improve the implementation of GCSS-Army, the Secretary of the Army should ensure that the Under Secretary of the Army, in his capacity as the Chief Management Officer, directs the GCSS-Army Program Management Office to update the cost estimate to fully incorporate best practices by documenting the results of (1) a risk and uncertainty analysis, (2) the cross-checking of major cost elements to see if results are similar, and (3) a sensitivity analysis.

    Agency Affected: Department of Defense: Department of the Army

 

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