Army Lacks an Integrated Strategy for Achieving TAV

The Army has estimated that it will invest about $5 billion over the next  several years to complete development and implementation of GFEBS,  GCSS-Army, and LMP. However, the Army is making this significant  investment without a clear integrated strategy for how these systems will  be used to achieve TAV over hundreds of billions of dollars of assets. Without these key  foundational elements, the Army is at risk of investing billions of dollars in  business systems that may not achieve DOD’s and the Army’s goal of  achieving TAV. GFEBS, GCSS-Army, and LMP are not being  managed and developed in the context of a well-defined Army-wide EA. As  a result, the Army does not have a well-informed basis for determining if  these systems will fit within the context of future Army business  operations and will most efficiently and effectively address the Army’s  long-standing weaknesses associated with the lack of asset visibility. Improving asset visibility is critical to addressing the problems associated  with supply chain management, which has been on our high-risk list since  1990. An effective concept of operations  would describe, at a high level, (1) how the three business systems relate  to each other in achieving the Army’s TAV goal, and (2) how information  flows from and through these systems. Moreover, we found that the  Army’s lack of a concept of operations has contributed to its failure to  take full advantage of business process reengineering opportunities that  are available when using an ERP solution. Army’s Ability to Effectively Oversee Portfolios of Business Systems Investment Is Not Yet Fully Developed

While the Army has established a governance structure to oversee its  business system investments—including its asset accountability system  investments—that is consistent with DOD guidance, additional actions are  needed to enhance oversight, control, and accountability. Taking an enterprise view enables an  organization to consider its investment comprehensively, so that  collectively the investments optimally address the organization’s mission,  goals, and objectives. In addition, we found that the Army did not have  reliable processes and analyses to support its oversight of individual  systems modernization program efforts intended to improve asset  visibility. LMP Illustrates Continuing Problems in Implementing Business Systems on Time, within Budget, and with the Promised Capability

LMP continues to be plagued by operational problems that have beset the  system virtually since its initial implementation in July 2003. These problems can, in part,  be attributed to ineffective system testing. Recommendations for Executive Action

To improve the department’s efforts to achieve TAV and further enhance  its efforts to improve the control and accountability over business system  investments, we recommend that the Secretary of Defense direct the  Secretary of the Army and the Director, BTA, to jointly take the following  five actions:    Develop a concept of operations that (1) clearly defines the ERP vision for  accomplishing total asset visibility within the Army; (2) addresses how its  business systems and processes, individually and collectively, will provide  the desired functionality to achieve TAV; and (3) determines the desired  functionality among the selected systems. Key contributors to this report are listed in appendix V.

Appendix I: Scope and Methodology

To determine whether the Army has developed a business system strategy  for achieving total asset visibility (TAV), we met with program office  officials for the General Fund Enterprise Business System (GFEBS), the  Global Combat Support System-Army (GCSS-Army), and the Logistics  Modernization Program (LMP). More specifically, LMP continues to experience problems  with accurately recognizing revenue and billing customers.
Why GAO Did This Study

The Department of Defense (DOD) established a goal to achieve total asset visibility (TAV) over 30 years ago, but to date it has been unsuccessful. GAO was requested to (1) determine whether the Army has a systems strategy for achieving TAV, (2) determine if the Army's business system investment governance structure is consistent with DOD guidance, and (3) evaluate the Army's effort to correct previously reported problems with the Logistics Modernization Program (LMP). GAO obtained an understanding of the Army's efforts to achieve TAV, oversee and manage its business system investments, and address previously reported LMP problems.

What GAO Found

Supply chain management has been on GAO's high-risk list since 1990. One area that has contributed to this long-standing problem has been DOD's inability to maintain control and accountability over hundreds of billions of dollars of assets. DOD plans to improve its asset management through its business system modernization. In this regard, GFEBS, the Global Combat Support System-Army (GCSS-Army), and LMP are aimed at achieving TAV within the Army. The Army estimates that it will invest approximately $5 billion to develop and implement these systems. However, this investment is being made without a clear integrated strategy. GFEBS, GCSS-Army, and LMP are not being developed in the context of a well-defined Army-wide enterprise architecture. As a result, the Army does not have an informed basis for determining if these systems will fit within the context of future Army business operations and will efficiently and effectively address the Army's long-standing weaknesses associated with the lack of asset visibility. The Army lacks a concept of operations that would describe, at a high level, (1) how the three business systems relate to each other in achieving the Army's TAV goal, and (2) how information flows from and through these systems. Moreover, GAO found that the Army's lack of a concept of operations has contributed to its failure to take full advantage of business process reengineering opportunities that are available when using an enterprise resource planning solution. Without these key foundational elements, the Army is at risk of investing about $5 billion in business systems and still not achieving DOD's and the Army's goal of TAV. Furthermore, while the Army has established a governance structure that is consistent with DOD guidance, its processes are still maturing. The Army's governance structure is designed to certify and review individual business systems rather than to evaluate these investments from a portfolio perspective. Such a perspective permits investments to be viewed in a comprehensive manner to help ensure that the organization's missions and objectives are achieved. GAO also found that the Army did not have reliable processes and analyses, such as an independent validation and verification function or economic analyses, to support its oversight of individual business systems. Until the Army's investment processes mature, it runs the risk of investing in business systems that do not provide the desired functionality and efficiency. Additionally, LMP continues to be plagued by problems that have beset the system since its implementation in July 2003. LMP continues to experience problems with accurately recognizing revenue and billing customers, which can, in part, be attributed to ineffective system testing.