DoD enterprise solutions: Structural/cultural issues remain major impediment - Technology Innovation

Program Manager, Jan, 2002 by Ron Klein

Despite the collapse of the dot.com speculation bubble, networking technologies are bringing substantial improvements to several commercial firms. Many visionaries are searching for applications of these technologies to improve DoD processes--the larger the undertaking the greater the potential payoff.

Large Enterprise Solutions Difficult to Implement

This article will list some of the challenges faced by DoD agencies that make success more difficult to achieve than for their corporate counterparts. Under the best of circumstances, large enterprise solutions are especially difficult to accomplish successfully The field is littered with far more failures than successes.

Little or No Incentive

In a government agency, what is the incentive to tackle such difficult endeavors? In many instances, a disincentive exists. If the agency is successful in reducing cost by 20 percent, its budget is reduced by the same amount. What rational manager takes on such a difficult, time-consuming, and draining challenge under these circumstances? Even when the financial disincentive is not present, there remains little or no reason to undertake such a disruptive and difficult project.

An example of this is aircraft overhauls. Through a series of process improvement steps, American Airlines now overhauls a Boeing 757 in three weeks. By contrast, it takes 304 days for Corpus Christi Army Depot to overhaul helicopters. Despite being offered the technology, no general or political appointee or congressperson is requiring the Army Depot to undergo such wrenching change.

Can't Make the Business Case

When corporate executives are presented with proposals, they orient on either a Return-on-Investment (ROI) or competitive pressure as the reason to approve, fund, and participate. In the public sector, competitive pressure rarely exists. With respect to establishing an ROI, one must first determine the "as is" costs and the estimated "to be" costs. DoD does not have a cost accounting system that collects this information. Without knowing within some degree of certainty the existing full costs, no ROI or payback projections can be made.

Such Projects Require Endurance

Reengineering large, complex processes requires years; its common for such undertakings to take place over four to eight years. Senior military personnel typically rotate out of leadership positions every 12 to 24 months. One cannot reasonably expect an executive to orient on the long-term when they are measured on near-term objectives.

Diffusion of Responsibilities

Implementing solutions with outside partners dramatically increases complexity, cost, and risk. The nature of DoD enterprise solutions is that they entail coordination with multiple affected agencies. As an example, a Marine Corps colonel who wants to implement an integrated supply chain improvement must persuade numerous other agencies to change their practices. This list includes, but is not limited to, the Defense Logistics Agency, Department of the Navy, Defense Finance and Accounting Service, legal reviews, impacted supply funding arrangements, quality control, and contracting officers. These agencies have little to gain; proposals often introduce substantial disruption to their organization, and frequently include the risk of job losses. Eliciting the active participation of the senior executive (in this case, the Secretary of Defense) is not viable.

Rewards Come from Concepts, Not Completion

Major development programs require years--even decades to be completed. The personnel appraisal and promotion system rewards new ideas and projects, not the continuation of existing ones. No one gets promoted by stating their performance objective is to "keep the [fill in the blank] initiative on track." Over the course of a program, thousands of unplanned variables emerge such as technology changes, funding variances, and test results. This situation, combined with the diffusion of responsibilities and relatively short assignments, results in an environment where no one can reasonably be held accountable for on-schedule, on-time, at-cost performance.

Since actual performance cannot be measured, one outcome is a culture where new ideas are valued. Ambitious managers know that a promising new initiative will give the appearance of innovative management. In the actual implementation of process innovation, 5 percent of the effort is expended on the development of a plan and 95 percent on the implementation. Since the majority of the reward (recognition) is derived from the development of a new initiative, rational persons will devote their time and energies devising new or modified plans (and emphasizing how superior their new or modified plans are compared to the status quo).

Congressional Funding is Stovepiped

Congressional funding for programs is provided to program managers to achieve success on their particular programs. Enterprise solutions, by definition, require the resources of multiple agencies.

Government Personnel Tend to be Risk- and Change-Averse