Defense Reform Initiative:

Organization, Status, and Challenges

NSIAD-99-87: Published: Apr 21, 1999. Publicly Released: Apr 21, 1999.

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Pursuant to a congressional request, GAO reported on: (1) actions taken through the Defense Reform Initiative (DRI) management structure to facilitate achieving the program's objective; and (2) progress the Department of Defense (DOD) made in implementing individual reform initiatives.

GAO noted that: (1) by adopting proven management change concepts in implementing the DRI program, DOD has addressed some of the obstacles that have limited the success of past reform efforts; (2) the Secretary and Deputy Secretary of Defense have shown strong support for the program and established an organizational framework to give additional structure and guidance to the effort; (3) this framework consists of a Defense Management Council, a Coordinating Group to support the Council, and a DRI Office to track implementation and identify issues that need management attention; (4) further, using special directives, performance contracts, and other planning guidance, DOD has sought to institutionalize and provide a sustained emphasis on the DRI; (5) this framework, taken in total, has helped create a Defense-wide focus on infrastructure reduction and provides a forum where problems caused by cultural barriers and parochial interests can be addressed; (6) because the DRI framework has been in place for just over a year, it is too soon for GAO to assess how effective it will be in the long term; (7) GAO did, however, identify several areas where DOD could build on its initial efforts and give even greater impetus to its goal of achieving a revolution in business affairs; (8) these include: (a) incorporating other major ongoing reform efforts in the DRI so it can develop a more comprehensive, integrated strategy for reforming Defense business and support activities; (b) more clearly delineating the funding requirements needed to achieve major reforms; and (c) enhancing the Department's ability to measure DRI results, particularly through financial management and related reforms; (9) each of the four DRI pillars include a variety of reform or reengineering initiatives, many of which were already ongoing before they were brought under the DRI umbrella; (10) DRI has given each of these initiatives increased visibility and top-level support within the Department and, in many instances, imposed new goals and milestones for accomplishing their objectives; (11) each initiative varies in its progress toward meeting its objectives and milestones; (12) many still face a variety of issues that could affect their ultimate success and will likely take longer to complete than the milestones established by the DRI; (13) the success of the DRI will depend largely on DOD's ability to maintain a high degree of emphasis on the initiatives over the long term; and (14) past reform efforts started out well but tended to lose momentum as the Department's leadership and priorities changed.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: DOD has been partially responsive to the recommendation in that it has brought financial management and logistics reform efforts under the purview of the DRI. It has also incorporated some aspects of the DRI into its Fiscal Year 1999/2000 GPRA Performance Plan. DOD also plans to develop better performance metrics for the initiatives in the expanded DRI. However, DOD does not plan to develop a comprehensive integrated strategy and action plan for managing the DRI; DOD does not believe it would benefit from such a strategy and action plan because it would not be completed in time to serve the current Administration. In a subsequent report on the DRI(GAO/NSIAD-00-72)we incorporated this recommendation under a matters for consideration to the Congress.

    Recommendation: To strengthen the Defense reform effort, the Secretary of Defense should take the necessary actions to bring all major business process and infrastructure reform initiatives, including logistics and financial management reform, under the DRI program and follow the framework provided by the Government Performance and Results Act of 1993 to establish a more comprehensive, integrated strategy and action plan for reforming the Department's major business processes and support activities.

    Agency Affected: Department of Defense

  2. Status: Closed - Not Implemented

    Comments: DOD did not act on this recommendation. It did not see the need to identify funding requirements for the major reform initiatives and Department-wide funding targets for the DRI program. DOD's rationale is that placing an overall cost on the DRI program and including the cost as a separate item in the budget would set up an easy target for budget-cutters. DOD continued funding the various initiatives via the normal budget process-using Program Budget Decisions. Because GAO believes this is a key recommendation, it again addressed this issue in a subsequent report on the DRI (NSIAD-00-72). However, this report included the recommendation as a matter for congressional consideration.

    Recommendation: To strengthen the Defense reform effort, the Secretary of Defense should take the necessary actions to more fully identify investment funding requirements for the major reform initiatives and Department-wide funding targets for the DRI program and communicate them to Congress during the annual budget process.

    Agency Affected: Department of Defense


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