Transforming resource management to support an Army at war: the Army's chief financial officer examines three priorities for best use of the nation's money

Public Manager, The, Winter, 2007 by Nelson M. Ford

In summary, this analysis told us that the cost of the doctrinal Army was approximately $138 billion per year in fiscal year 2008 (FY08) dollars, $24 billion more than the Army's FY08 resource guidance from OSD. Army leadership took this analysis to the Secretary of Defense and, following extensive review of the Army's fiscal situation, the Office of Management and Budget added funds to the FY08 president's budget request to partially close the gap. In early 2007,we updated the estimate to reflect President Bush's decision to expand the Army by 74,000 Soldiers. The current cost estimate for sustaining the Army at its proposed size and mission is $152 billion in FY08 dollars.

Unfortunately, this analysis does not drive the federal budget process, either within the Department of Defense (DoD) or in Congress. DoD has all the military services to consider, and members of Congress have to take into account their constituents' concerns. The outcome of balancing requirements within DoD and across the government, even given the constitutional imperative for defense of the nation, mitigates against the Army's needs being fully funded. Nonetheless, to make sure that decision makers don't lose sight of our requirements, we strive to quantify them carefully. At the very least, cost-based analysis gives us factual data that enable us to describe what we can and cannot do with the available resources and what we need to be ready to do.

Reestablishing Management Controls

We must reestablish strong management controls throughout the Army. In the past, most of our time and energy has been spent formulating, submitting, and defending the budget. This is an important responsibility because without adequate and timely flow of funds from Congress, the Army would grind to a halt. However, while recognizing the importance of the budgeting function, we also have to refocus our attention on management controls over the resources that Congress has given us so that we can

* safeguard our assets,

* ensure compliance with laws and regulations,

* instill confidence in Congress and the American people in how we are managing the funds entrusted to us, and

* perhaps most importantly, make the best use of the funds the budgeting process gives us.

During the first part of the current fight, we experienced gradual but real erosion in our control systems. The term "battlefield accountability" recognizes that the need to be effective in the heat of combat operations doesn't always lend itself to peacetime accountability practices. Over time, however, as combat operations turned slowly into persistent conflict, both the public and Congress expected that our control would reflect peacetime accountability standards.

We have been working on this problem for the past two years and have materially strengthened the Army's critical controls with no loss of mission effectiveness. We've focused on deploying systems and developing policies that will help us to reduce costs; improve the linkages among the Army's finance, procurement, and logistics functions; and better support Soldiers and commanders (see box).