American forces press service (April 1, 2004): DoD progresses in transforming business practices, standards.

WASHINGTON -- The Defense Department is making steady progress in establishing a common set of business standards and practices that eliminates duplication and promotes information sharing, Pentagon financial and information officials told members of Congress March 31.

JoAnn Boutelle, the Pentagon's deputy chief financial officer, and Margaret Myers, principal office director for the deputy chief information officer, outlined DoD's business transformation efforts in prepared testimony to the House Subcommittee on Terrorism, Unconventional Threats and Capabilities.

Boutelle described "enormous progress" made during the past three years to overcome decades-old business practices in which the military services and DoD agencies operated with some 2,300 independent business systems that rarely interacted with other systems.

"Their information could not be easily exchanged nor aggregated for use by senior DoD leaders for decision making," Boutelle told the subcommittee. And because the systems were designed for specific functional purposes such as logistics, acquisition, or human resources, they rarely produced the data needed to generate "clean, auditable financial statements," she said.

Boutelle said sweeping changes introduced in 2001 center on eliminating redundant and incompatible systems by using more efficient business practices.

The Business Management Modernization Program, which Boutelle said will take several more years to complete, will result in an integrated network of systems within the department. "We are working to streamline, re-engineer and standardize our business practices, not simply improve the handling of information."

Myers called the program "an unprecedented effort to build a competitive advantage by transforming how we do defense business." Through business transformation, she said DoD "will expend fewer resources on business processes and systems (and) ensure that men and women in uniform have the business information they need--whenever and wherever they need it."

The department will be able to "inform Congress and the public, with confidence, on how we use our resources," Myers added.

To continue funding this evolution, the fiscal 2005 defense budget request includes $122 million for the program and what Boutelle called its centerpiece, the Business Enterprise Architecture. The architecture will serve as a blueprint to guide the department's diverse business communities in transforming their processes and systems, Boutelle explained.

"We are at a critical state in our transformation," Boutelle said. "We are off to a strong start, but much remains to be done."

Boutelle said aggressively implementing the Business Enterprise Architecture will drive the department to transform its business practices as rapidly as possible while improving its effectiveness in carrying out its national security mission.

The transformation, Boutelle said, "is as complex and difficult as any challenge the department has faced," but the stakes are enormous, affecting the way DoD manages billions of dollars in assets, liabilities, and appropriations.

"Transformation is absolutely crucial to DoD's ability to enhance America's national security in this era of terrorism and uncertainty," she said. "The speed, accuracy, interoperability, reliability, and dependability of our information resources are critical."