DOD makes progress in meeting OMB goals

The Defense Department has improved its rating in two of five initiatives laid out in President Bush's Management Agenda, but still has a way to go in achieving the highest ranking of green in each of the agenda's goals, the deputy undersecretary of Defense for plans said.

When the Office of Management and Budget unveiled the agenda in June 2001, DOD had the worst possible rating of red in each of the five categories: strategic management of human capital, competitive sourcing, financial performance, e-government, and budget and performance integration.

The agenda uses a red-yellow-green rating system to measure an agency's progress in meeting the goals.

Gail H. McGinn, deputy undersecretary of Defense for plans, said DOD's poor performance was due to the size and complexity of a department with more than 3 million active-duty, Reserve and civilian personnel. Speaking last month at a luncheon sponsored by the Association for Federal Information Resources Management at George Washington University, she discussed the latest annual results for the department, which were released as part of DOD's 2004 budget proposal.

In the 21 months since the President's Management Agenda was introduced, DOD has improved its ranking to yellow in the categories of strategic management of human capital and budget and performance integration, she said. Both areas were particularly challenging because of the size and global deployment of Defense employees and agencies.

No timeline

'Getting to green isn't easy; it's very complicated,' McGinn said. 'I think the folks in the DOD have done yeoman's work in moving toward the objectives' laid out in the agenda.

OMB doesn't give agencies a timeline to meet the five goals, McGinn said, acknowledging that DOD will likely take eight to 10 years to reach green in all areas.

To help accomplish its goals, the Pentagon has developed a 31-page restructuring plan, following instructions from In budget and performance integration, Defense began with poorly defined performance measures and inadequate figures on the full cost of programs, McGinn said.

'Our challenge was what do you measure and how do you define output targets?' McGinn said. Currently, DOD is developing performance metrics and tracking results, he said.

In competitive outsourcing, Defense identified more than 226,000 government positions it could open to competition from the private sector last year and competed five percent of them, meeting an administration target. This year, the DOD's target to open 15 percent of its noncritical positions to private competition, she said.

In e-government, OMB identified little cross-agency coordination, McGinn said. Instead, DOD systems were segregated, redundant and not citizen-focused, she said.
McGinn expects DOD to increase its rating from red to yellow soon in e-government, since the department has submitted 180 business cases for IT programs, representing $11 billion of the DOD's total $26 billion investment. 'We have improved the visibility of our business cases,' she said.

But the category that will likely be the most difficult for DOD to achieve green status in is financial performance, officials said. With roughly 1,800 disparate financial systems, DOD's financial problems have ranged from erroneous payments and unsatisfactory audits to heavy interest and fees paid for late payments.

Last year, DOD hired IBM Corp. to begin the DOD Financial Management Modernization Program, merging all of the department's financial systems into a common system.

IBM is working to develop a financial management enterprise architecture. McGinn said the project passed its first milestone last October and is on track to make another deliverable in April. Although DOD's score was red in financial performance, the department was given a green in the category of making progress, McGinn said.

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