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Opening Statements of Chairman
Jim Saxton
Hearing on "Department of Defense Business
Transformation"
Good afternoon
ladies and gentlemen. The Subcommittee on
Terrorism, Unconventional Threats and
Capabilities meets this afternoon to learn
more about how the Department of Defense is
modernizing its business processes and
practices. Essentially, how are DOD Business
modernization efforts progressing?
The
Department's information technology (IT)
request for fiscal year 2005 is $28.7 billion
and is intended to support both on-going
operating requirements and programs in
development. The subcommittee is mindful that
while these funds may support many important
IT systems, the Department continues to spend
money to update legacy systems that the new
systems will soon replace. It is the
subcommittee's concern that these dollars are
not being applied to business and warfighting
programs, especially when our soldiers,
sailors, Marines, airmen, and pilots are
conducting military operations around the
globe.
As one of the
world's largest and most intricate
organizations, no one doubts that running
day-to-day business operations at the
Department is challenging. With over $1
trillion in assets, nearly $1.6 trillion in
liabilities, over 3.3 million military and
civilian personnel, and disbursements of over
$416 billion in fiscal year 2003, it is
critical that the Department exercise
effective management over its business
operations. That is why we are here today. We
are interested to learn what DOD is doing to
bring its numerous financial management and
business information technology systems into
streamlined processes.
Many major
commercial businesses have undergone
significant business transformations in the
past decade in order to stay profitable. Using
the industry model, DOD would be wise to
leverage such commercial best practices to
improve its own business practices.
Implementing an enterprise architecture, using
performance metrics to measure new system
developments, and breaking cultural barriers
and parochial interests are a few examples of
such practices.
The
subcommittee remains committed to ensuring
that resources are properly allocated to IT
systems that fit into a department-wide
enterprise architecture. However, we remain
concerned that the Department's business
system implementers are ignoring the law and
the Department's leadership by continuing to
develop stovepipe systems that do not conform
to a DOD enterprise architecture. It appears
there is wide spread disregard for the law
that requires procurement officials to obtain
the Comptroller's permission before purchasing
IT equipment and services costing more than $1
million. Some IT and acquisition officials
apparently believe it is easier to ask for
forgiveness than to abide by the law and ask
for permission first. These and other
fundamental issues must be addressed as the
Department handles day-to-day business
functions to support military operations
around the world.
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