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TESTIMONY OF
KENT SCHNEIDER
PRESIDENT
DEFENSE ENTERPRISE SOLUTIONS
NORTHROP GRUMMAN INFORMATION TECHNOLOGY

BEFORE THE
HOUSE ARMED SERVICES COMMITTEE
SUBCOMMITTEE ON TERRORISM, UNCONVENTIONAL THREATS AND CAPABILITIES
UNITED STATES HOUSE OF REPRESENTATIVES

REGARDING DOD BUSINESS TRANSFORMATION EFFORTS

 March 31, 2004  

Ladies and Gentlemen, I am Kent Schneider and have the privilege of being the President of Defense Enterprise Solutions of Northrop Grumman Information Technology, headquartered in McLean, Va.  I appreciate the opportunity to share my thoughts with you today. The Department of Defense is in the midst of a profound transformation of business systems and processes that supports new operational concepts and reflects great technology strides in communication and enterprise awareness.  Secretary of Defense Donald Rumsfeld recently issued a memorandum indicating that the DoD has done well on the operational side of Defense transformation, but that he did not have that same sense regarding DoD systems, processes, and business practices.  Secretary Rumsfeld stated that we remain "in the Industrial Age, vice the 21^st Century", with regard to DoD systems and processes.

At Northrop Grumman, we believe three concepts or themes underpin successful public domain business systems modernization and transformation:

• First, DoD needs to take an enterprise view of defense transformation in order to achieve interoperability, scalability, agility and greater mobility of enterprise systems and architectures.

• Second, we (the DoD and industry) need to re-use and reapply technologies that already exist.  We need to take proven, best-of-breed technologies from the commercial and government sectors and adapt them to similar problems in possibly unrelated environments.  Lower cost and lower risk will result from such reapplication.

• Third, we need to find a balance between best commercial practices and DoD systems engineering experience and domain expertise.  Often, proven commercial solutions and practices fail when applied to Government requirements, particularly in the DoD.  This results from the unprecedented scale of defense operations, the complex environment within which major defense systems are developed and introduced, and unique Government processes that are often anchored in public law and regulation. We have found that a partnership between commercially-oriented firms and defense integrators like Northrop Grumman offer the proper balance, bringing commercial best practices and the required military domain expertise.

Allow me to offer one example that embraces all of these concepts in a successful defense transformation.  The Defense Integrated Military Human Resources (DIMHRS) system is a new DoD program that drives at the very heart of transformation requirements for our globally deployed forces. DIMHRS is the epitome of an enterprise approach to business system transformation.  We are now using combined forces in combat areas where all active services are represented, along with their National Guard and Reserve Component counterparts.  The individual war fighter must be assured of timely and accurate pay for his family.  The Combatant Commander must have access to personnel readiness assessments that impact his decision process in theater.  DIMHRS, when fully deployed, will provide all pay and human resources information for 3.1 million service men and women worldwide.  Upon completion, a single integrated system will support human resources management, pay and benefits for every Service, active, retired, reserve, and National Guard.  Think of the flexibility that provides in an environment of rapid global deployment of reconfigurable forces.

DIMHRS is being built on commercial off-the-shelf products.  The PeopleSoft Human Resources Management System (HRMS) was selected by the Government as the heart of this new system.  We selected other commercial products to complement the HRMS and fulfill the DoD requirements.  Less than 10 percent of this system will be custom software at completion, speeding delivery, reducing cost, and minimizing risk.

DIMHRS also provides evidence of the need for marriage of commercial practice and defense domain experience and the ability to integrate in a complex environment.  As previously mentioned, DIMHRS will be built on a PeopleSoft HRMS to develop a system to support 3.1 million soldiers, sailors, airmen, and marines.  This is a full order of magnitude larger than any other PeopleSoft development ever attempted.  DIMHRS will replace 79 legacy systems and provide a DoD-wide system that integrates personnel and pay systems and tracks each war fighter's career from recruitment to retirement.  We have addressed this complex set of requirements by assembling a team that brings the best of commercial practice and experience, combined with Northrop Grumman's 30-plus years of military HR development and integration experience.

In conclusion, the cornerstone of DoD's successful business transformation is a public-private partnership with those organizations possessing in-depth knowledge of the DoD domain coupled with a successful history of designing and implementing large scale enterprise integration and interoperability solutions.  Given that foundation of knowledge and expertise, commercial products and practices can be successfully applied to the military's complex requirements.  Thank you for your attention.

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