What GAO Found
The Department of Defense (DOD) continues efforts to establish a business enterprise architecture (a modernization blueprint) and transition plan and modernize its business systems and processes, in compliance with key provisions of the Ronald W. Reagan National Defense Authorization Act for Fiscal Year 2005 and amendments. Nonetheless, long-standing challenges remain. The following reflects the status of DODs actions to fulfill selected requirements of the act.
- Develop a business enterprise architectureDOD continues to develop content for its business enterprise architecture, such as business rules, and is proceeding with efforts to extend the architecture to its components. However, even though DOD has spent more than 10 years and at least $379 million on its business enterprise architecture, its ability to use the architecture to guide and constrain investments has been limited by, among other things, the lack of a detailed plan.
- Develop an enterprise transition planThe departments latest version of its transition plan included data on more than 1,200 covered defense business systems; however, important content, such as time-phased milestones and performance measures, is still needed to address the acts requirements.
- Establish an investment approval and accountability structure along with an investment review processDOD has taken steps to establish a portfolio-based approach to certifying defense business systems, including the establishment of a corporate-level board to oversee the approach and guidance for selecting, controlling, and evaluating the investment portfolio. However, it has yet to fully establish the foundation for its new portfolio-level investment management process or the criteria and procedures for making portfolio-based investment decisions.
- Certify any business system program costing in excess of $1 million as compliant with the business enterprise architecture and as having undertaken appropriate business process reengineeringDODs portfolio-based investment approach included reviewing and certifying more than 1,200 business systems for fiscal year 2013, totaling about $6.8 billion in funding. However, while DOD continues to perform compliance assertions, it has not ensured the accuracy of business enterprise architecture alignment through validation of individual investments. Further, appropriate business process reengineering assertions were not completed and the associated results and outcomes have yet to be reported.
In addition, the Office of the Deputy Chief Management Officer has yet to determine and follow a strategic approach to managing its human capital needs, thus limiting its ability to, among other things, effectively address the acts requirements. Collectively, these limitations put the billions of dollars spent annually on approximately 2,100 business system investments that support DOD functions at risk. GAOs previous recommendations to the department have been aimed at accomplishing these and other activities related to the business systems modernization. However, to date, the department has not implemented 29 of the 63 recommendations that GAO has made in these areas.
According to DOD officials, recent turnover, changes to the acts requirements significantly expanding the number of systems subject to certification, and the short time frame for implementing the new investment review process contributed to the aforementioned weaknesses. Until DOD implements GAO recommendations and addresses the weaknesses described in this report, it will be challenged in its ability to manage the billions of dollars invested annually in modernizing its business system investments.
Why GAO Did This Study
GAO designated DODs multibillion dollar business systems modernization program as high risk in 1995, and, since then, has provided a series of recommendations aimed at strengthening DODs institutional approach to modernization and reducing the risk associated with key investments. The act requires the department to report on actions taken relative to its business systems modernization efforts and GAO to assess DODs actions to comply with the act. In evaluating DODs compliance, GAO analyzed, for example, the latest version of the business enterprise architecture and enterprise transition plan, investment management policies and procedures, and certification actions for its business system investments.
GAO is making recommendations to help ensure that the departments modernization program is fully compliant with provisions of the act and to improve the departments architecture, transition plan, and business system investment management and human capital management within the Office of the Deputy Chief Management Officer. DOD concurred with two recommendations, partially concurred with three, and did not concur with three. GAO continues to believe its recommendations are warranted given the departments need to more effectively manage its billions of dollars of business system investments and minimize or eliminate system overlap and duplication as appropriate.
Recommendations for Executive Action
|Department of Defense||1. To effectively implement key components of DOD's business systems modernization program, the Secretary of Defense should direct the Deputy Chief Management Officer to define by when and how the department plans to develop an architecture that would extend to all defense components and include, among other things, (a) information about the specific business systems that support business enterprise architecture (BEA) business activities and related system functions; (b) business capabilities for the Hire-to-Retire and Procure-to-Pay business processes; and (c) sufficient information about business activities to allow for more effective identification of potential overlap and duplication.|
|Department of Defense||2. To effectively implement key components of DOD's business systems modernization program, the Secretary of Defense should direct the Deputy Chief Management Officer to define by when and how the enterprise transition plan will include, among other things, (a) milestones, performance measures, and funding plans for all business systems expected to be part of the target architecture and each system's risks or challenges to integration; (b) time-phased end dates associated with terminating legacy systems in phases; (c) a listing of all other defense business systems (including systems that are considered to be core systems) that will be a part of the target defense business systems computing environment and a strategy for making modifications to those systems that will be needed to ensure that they comply with the defense BEA, including time-phased milestones, performance measures, and financial resource needs; and (d) information about how systems are to be sequenced according to, among other things, dependencies among investments.|
|Department of Defense||3. To effectively implement key components of DOD's business systems modernization program, the Secretary of Defense should direct the Deputy Chief Management Officer to ensure that the functional strategies include all of the critical elements identified in DOD investment management guidance, including performance measures to determine progress toward achieving the goals that incorporate all of the attributes called for in the department's guidance.|
|Department of Defense||4. To effectively implement key components of DOD's business systems modernization program, the Secretary of Defense should direct the Deputy Chief Management Officer to select and control its mix of investments in a manner that best supports mission needs by (a) documenting a process for evaluating portfolio performance that includes the use of actual versus expected performance data and predetermined thresholds; (b) ensuring that portfolio assessments are conducted in key areas identified in our IT investment management framework: benefits attained; current schedule; accuracy of project reporting; and risks that have been mitigated, eliminated, or accepted to date; and (c) ensuring that the documents provided to the Defense Business Council as part of the investment management process include critical information for conducting all assessments.|
|Department of Defense||5. To effectively implement key components of DOD's business systems modernization program, the Secretary of Defense should direct the Deputy Chief Management Officer to implement and use the BEA and business process reengineering compliance assessments more effectively to support organizational transformation efforts by (a) disclosing relevant information about known weaknesses, such as BEA and business process reengineering compliance weaknesses for systems that were not certified or certified with qualifications in annual reports to Congress; (b) establishing milestones by which selected validations of BEA compliance assertions are to be completed; and (c) ensuring that appropriate business process reengineering assertions have been completed on all investments submitted for the fiscal year 2014 certification reviews prior to the certification of funds.|
|Department of Defense||6. To effectively implement key components of DOD's business systems modernization program, the Secretary of Defense should direct the Deputy Chief Management Officer to develop a skills inventory, needs assessment, gap analysis, and plan to address identified gaps as part of a strategic approach to human capital planning for the Office of the Deputy Chief Management Officer.|
|Department of Defense||7. The Secretary of Defense should direct the appropriate authority to ensure that complete documentation, such as root cause analyses, assessments of existing interfaces for reuse opportunities, and performance metrics related to the reengineering efforts, is provided as part of the fiscal year 2014 certification and approval process for the Integrated Personnel and Pay System - Army (IPPS-A), Integrated Personnel and Pay System - Navy (IPPS-N), Air Force Integrated Personnel and Pay System (AF-IPPS), and Integrated Electronic Health Record (iEHR) investments.|
|Department of Defense||8. The Secretary of Defense should direct the appropriate authority to determine whether funds were properly obligated under 10 U.S.C. 2222(a)-(b) for systems for which appropriate business process reengineering assertions were not completed.|