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entitled 'DOD Business Transformation: Air Force's Current Approach 
Increases Risk That Asset Visibility Goals and Transformation 
Priorities Will Not Be Achieved' which was released on August 8, 2008.

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Report to the Subcommittee on Readiness and Management Support, 
Committee on Armed Services, U.S. Senate: 

United States Government Accountability Office: 
GAO: 

August 2008: 

DOD Business Transformation: 

Air Force's Current Approach Increases Risk That Asset Visibility Goals 
and Transformation Priorities Will Not Be Achieved: 

GAO-08-866: 

GAO Highlights: 

Highlights of GAO-08-866, a report to the Subcommittee on Readiness and 
Management Support, Committee on Armed Services, U.S. Senate. 

Why GAO Did This Study: 

The Department of Defense (DOD) established a goal to achieve total 
asset visibility over 30 years ago. This initiative aims to provide 
timely, accurate information on the location, movement, status, and 
identity of equipment and supplies. To date, the effort has been 
unsuccessful. GAO was requested to determine (1) the implementation 
status of the Air Forceís business system initiatives to achieve total 
asset visibility, and whether the Air Force has implemented related 
best practices, and (2) whether the Air Forceís business transformation 
efforts to achieve total asset visibility are aligned within the Air 
Force and with DODís broader business transformation priorities. GAO 
interviewed Air Force officials and reviewed Air Force documentation to 
obtain an understanding of the Air Force's system initiatives and 
strategy for achieving total asset visibility and to identify areas for 
improvement. 

What GAO Found: 

The Air Force has identified the Expeditionary Combat Support System 
(ECSS) and the Defense Enterprise Accounting and Management System 
(DEAMS) as key technology enablers of the Air Force's efforts to 
transform its logistics and financial management operations and achieve 
total asset visibilityóa key DOD priority. 

* ECSS is expected to provide a single, integrated logistics system, 
including transportation, supply, maintenance and repair, and other key 
business functions directly related to logistics such as engineering 
and acquisition. Additionally, ECSS will perform financial management 
and accounting for the Air Force working capital fund operations. ECSS 
is expected to be fully operational in fiscal year 2013, and replace 
about 250 legacy logistics and procurement systems. 

* DEAMS is expected to provide the entire spectrum of core financial 
management capabilities, including collections, commitments/ 
obligations, cost accounting, general ledger, funds control, receipts 
and acceptance, accounts payable and disbursement, billing, and 
financial reporting for the Air Force general fund operations. DEAMS is 
expected to replace seven legacy systems and be fully operational in 
fiscal year 2014. 

GAO identified several areas in which the Air Force had not fully 
implemented best practices related to risk management and system 
testing. These findings increase the risk that these business system 
initiatives will not meet their stated functionality, cost, and 
milestone goals, thereby limiting the Air Forceís efforts to achieve 
total asset visibility and other DOD business transformation 
priorities. 

Further, key Air Force business transformation strategic plans and 
documents were not aligned within the Air Force nor with DODís broader 
business transformation priorities. While each individual Air Force 
plan was intended to support the Air Forceís business transformation 
efforts, the plans did not reflect a coordinated effort toward 
achieving a stated Air Force or DOD goal. For example, neither the Air 
Force's Military Equipment Accountability Improvement Plan for 
supporting DODís military equipment valuation effort, nor the Air Force 
Logistics Enterprise Architecture Concept of Operations, its key 
strategic transformation plan for logistics, identified a shared 
relationship, including metrics, in supporting Air Force and DOD 
logistics and financial management transformation goals. As a result, 
neither the Air Force nor DOD will have the performance data needed to 
oversee efforts intended to improve the Air Forceís ability to locate, 
manage, and account for assets throughout their life cycle. 

What GAO Recommends: 

GAO makes three recommendations to DOD to improve the Air Force's risk 
management process and system testing related to ECSS and DEAMS, and 
integration of transformation plans for achieving business 
transformation and goals, including total asset visibility. DOD 
concurred with the recommendations and identified specific actions that 
it will take to implement them. 

To view the full product, including the scope and methodology, click on 
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-08-866]. For more 
information, contact Paula M. Rascona at (202) 512-9095 or 
rasconap@gao.gov. 

[End of section] 

Contents: 

Letter: 

Results in Brief: 

Background: 

Improvements Are Needed in the Air Force's Approach for Acquiring and 
Implementing ECSS and DEAMS: 

Better Integration Is Needed to Ensure That the Air Force's Business 
Transformation Plans Support DOD Business Transformation Priorities and 
Total Asset Visibility: 

Conclusion: 

Recommendations for Executive Action: 

Agency Comments and Our Evaluation: 

Appendix I: Scope and Methodology: 

Appendix II: Comments from the Department of Defense: 

Appendix III: GAO Contacts and Staff Acknowledgments: 

Figures: 

Figure 1: ECSS Timeline and Funding: 

Figure 2: DEAMS Timeline and Funding: 

Abbreviations: 

DOD: Department of Defense: 

DEAMS: Defense Enterprise Accounting and Management System: 

ECSS: Expeditionary Combat Support System: 

FIAR: Financial Improvement and Audit Readiness: 

SFIS: Standard Financial Information Structure: 

[End of section] 

United States Government Accountability Office:
Washington, DC 20548: 

August 8, 2008: 

The Honorable Daniel K. Akaka: 
Chairman: 
The Honorable John Thune: 
Ranking Member: 
Subcommittee on Readiness and Management Support: 
Committee on Armed Services: 
United States Senate: 

Over 30 years ago, the Department of Defense (DOD) established a goal 
to achieve total asset visibility in recognition of its importance to 
successful operations. To date, DOD's efforts have been unsuccessful. 
DOD defines total asset visibility as the capability to provide timely, 
accurate information on the location, movement, status or condition, 
and identity of units, personnel, equipment, and supplies DOD-wide, and 
having the capability to act on that information. If the information 
contained in the asset accountability systems is not accurate, 
complete, and timely, DOD's day-to-day operations could be adversely 
affected by, for example, investing in inventory that is not needed to 
meet current needs. 

Asset visibility is one of three focus areas identified by the 
department as critical to effective and efficient supply chain 
management operations.[Footnote 1] The other two focus areas are 
inventory management and distribution. Collectively, these three areas 
are integral to department logistical operations[Footnote 2] and 
improvements are needed in each to address the problems associated with 
DOD's supply chain management, which has been on our high-risk list 
since 1990.[Footnote 3] Of the 27 areas on our high-risk list,[Footnote 
4] DOD has 8 high-risk areas of its own,[Footnote 5] and shares 
responsibility for 7 governmentwide high-risk areas.[Footnote 6] The 
nature and severity of DOD's deficiencies in these high-risk areas 
impedes the ability of DOD managers to receive the full range of 
information needed to effectively manage day-to-day operations. DOD's 
efforts to achieve total asset visibility should assist the department 
in addressing several of its high-risk areas, including supply-chain 
management, business system modernizations, and financial management by 
providing DOD management and the Congress with more accurate and 
reliable information for decision making purposes. 

Similar to the department as a whole, the Air Force continues to 
struggle to achieve and maintain efficient and effective management 
control over the hundreds of billions of dollars in inventory and other 
assets with which it is entrusted. For example, in 1996, we reported 
that information systems do not always provide Air Force managers and 
employees with accurate, real-time data on the cost, amount, location, 
condition, and usage of inventory--elements that are required to 
successfully plan, control, and measure inventory management.[Footnote 
7] Furthermore, in April 2007 we reported that more than half of the 
Air Force's spare parts inventory worth an average of $31.4 billion was 
not needed.[Footnote 8] Our report further noted that the Air Force has 
continued to purchase unneeded inventory because its policies do not 
provide incentives to manage the amount of inventory on order that may 
not be needed to support its logistics operations. The Air Force has 
acknowledged that its logistics operations have largely been 
reactionary, rather than anticipatory, because stovepiped business 
processes and systems impede visibility. Importantly, Air Force 
logisticians have historically met the challenge of fulfilling their 
mission within the constraints of archaic business processes and 
nonintegrated systems, through increased personnel and financial 
resources. 

The Air Force's vision for transforming its logistics operations to 
meet both the current and future threat environment is broad in scope 
and touches on all logistics functions, including transportation, 
maintenance, procurement, inventory management, and product life-cycle 
management, and crosses all commodity lines (such as fuel, munitions, 
aircraft, and vehicles) and organizational boundaries.[Footnote 9] The 
Air Force has determined that logistics must operate with an enterprise 
(Air Force-wide) view, across integrated processes, while optimizing 
resources and leveraging integrated technology "to deliver the right 
support, to the right place, at the right time, every time."[Footnote 
10] The Air Force has a number of ongoing technology, policy, 
organization, and process engineering initiatives to enhance asset 
visibility. Among these are asset marking and tracking initiatives, 
which are intended to enable more accurate and timely recording of 
asset information such as location, condition, and status through the 
use of unique item identification and radio frequency identification of 
individual or groups of assets. In addition, the Air Force has 
undertaken two business system initiatives, the Expeditionary Combat 
Support System (ECSS) and the Defense Enterprise Accounting and 
Management System (DEAMS) that it has identified as key to its efforts 
to transform its logistics and financial management operations, and 
achieve total asset visibility. ECSS will primarily be responsible for 
performing the logistical functions for both the Air Force's 
general[Footnote 11] and working capital[Footnote 12] funds and the 
financial management functions for the Air Force's working capital 
funds. DEAMS will perform the financial management functions for the 
Air Force's general funds. Although ECSS and DEAMS are important 
technology enablers, their ability to provide the information intended 
by Air Force to support total asset visibility, including asset 
accountability and decision making support, is largely dependent upon 
the Air Force's success in integrating, managing, and completing other 
transformation initiatives outlined in a variety of Air Force strategic 
plans and documents. 

This report provides information in support of your continuing 
oversight of DOD's progress towards resolving the department's long- 
standing problems in achieving total asset visibility. In July 2007, we 
reported on the Army's efforts to achieve total asset visibility. 
[Footnote 13] Our objectives were to determine (1) the implementation 
status of the Air Force's current business system initiatives to 
achieve total asset visibility, and whether the Air Force has 
implemented related best practices, and (2) whether the Air Force's 
business transformation efforts to achieve total asset visibility are 
aligned within the Air Force and with DOD's broader business 
transformation priorities.[Footnote 14] 

To address the first objective, we analyzed documentation and met with 
Air Force and DOD Business Transformation Agency officials to identify 
and determine the implementation status of key Air Force business 
system initiatives intended to support the Air Force's goal of 
achieving total asset visibility. Further, we interviewed and obtained 
briefings from Air Force logistics and financial management officials 
and others on ECSS and DEAMS program management and oversight. 
Specifically, we obtained and reviewed documentation related to each 
system initiative, including costs, implementation schedules, and risk 
management programs, to assess their acquisition status and to 
determine whether improvements were needed in the Air Force's approach 
for acquiring and implementing these systems. We did not review ECSS 
and DEAMS compliance with the Air Force's enterprise architecture 
because our related work focused on ascertaining the status of the 
military services' efforts to develop and use an enterprise 
architecture. The results of this work are discussed in our May 2008 
report, which noted that while the Air Force's efforts to develop an 
enterprise architecture were ahead of the Army's and the Navy's 
efforts, the Air Force's architecture was not sufficiently developed to 
guide and constrain its business systems modernization investments. 
[Footnote 15] To address the second objective, we obtained and analyzed 
key Air Force business transformation strategic plans to assess 
integration and utilization of metrics in supporting and managing the 
Air Force's efforts to transform its business operations and achieve 
total asset visibility. Additionally, we compared key Air Force 
business transformation plans with DOD's Enterprise Transition Plan to 
determine if DOD's business enterprise transformation priorities were 
incorporated into the Air Force's plans. 

We conducted this performance audit from July 2007 through August 2008 
in accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe that 
the evidence obtained provides a reasonable basis for our findings and 
conclusions based on our audit objectives. Details on our scope and 
methodology are included in appendix I. We requested comments on a 
draft of this report from the Secretary of Defense or his designee. We 
received written comments from the Deputy Under Secretary of Defense 
(Business Transformation), which are reprinted in appendix II. 

Results in Brief: 

The Air Force has identified ECSS and DEAMS as key technology enablers 
to the Air Force's efforts to transform its logistics and financial 
management operations and achieve total asset visibility. According to 
the Air Force, ECSS is expected to provide a single, integrated 
logistics system, including transportation, supply, maintenance and 
repair, and other key business functions, such as engineering and 
acquisition, directly related to logistics. Additionally, ECSS is 
expected to perform financial management and accounting functions for 
working capital fund operations.[Footnote 16] As of December 2007, the 
Air Force reported that it had obligated a total of $250 million for 
ECSS. Due to delays as a result of two contract award protests, the Air 
Force expects ECSS to reach full operational capability in fiscal year 
2013. When fully implemented, ECSS is expected to replace about 250 
legacy logistics and procurement (acquisition) systems and support over 
250,000 users Air Force-wide. DEAMS is expected to provide financial 
management and accounting functions for Air Force general fund 
operations. As of December 2007, the Air Force reported that it had 
obligated a total of $119 million for DEAMS. Cost information was not 
specifically identified by DOD as an element for achieving total asset 
visibility. However, there is a growing recognition within the 
department, including the Air Force, of the importance of cost 
information to effectively and efficiently manage business operations, 
including logistics management. Lack of integration between business 
systems, including logistics and financial management, has adversely 
affected the ability of DOD and the Air Force to ensure basic 
accountability, anticipate future costs and claims on the budget, 
measure performance, maintain funds control, and prevent fraud. If the 
information contained in asset and financial accountability systems is 
not accurate, complete, and timely, the Air Force's day-to-day 
operations could be adversely affected by, for example, investing in 
inventory that is not needed to meet current needs or for which the Air 
Force had not allocated sufficient resources or authority to purchase. 
Both physical and financial accountability are essential to achieving 
total asset visibility and DOD's objective of providing information to 
support decision making. When fully implemented, DEAMS is expected to 
replace seven legacy systems and reach full operational capability by 
fiscal year 2014. 

The Air Force has not fully managed ECSS and DEAMS programs in 
accordance with key DOD guidance and best practices for systems 
acquisition. More specifically, at the time of our review, neither the 
ECSS nor DEAMS program management office had used a comprehensive and 
fully integrated risk management process that provides the program 
management office clear visibility or linkages to risk management 
activities occurring within various subordinate program groups or 
activities. Visibility of activities occurring within the program is 
needed to help program management and other senior leaders ensure 
appropriate actions are taken to identify, analyze, and mitigate risks 
throughout the program, rather than within a single group or activity. 
In regard to system testing, the DEAMS program management office's 
field testing of DEAMS did not initially consider the impact that 
different computer desktop configurations would have on their ability 
to successfully deploy DEAMS at its first deployment location--Scott 
Air Force Base, Illinois. As a result, the DEAMS program management 
office had to delay further implementation of DEAMS at Scott Air Force 
Base because it unexpectedly encountered different computer desktop 
configurations that required a series of "system patches" to address 
software and connectivity issues before implementation could be 
completed. The delay at Scott Air Force Base underscores how the 
importance of obtaining a comprehensive understanding of a location's 
current operating environment is essential to the successful 
implementation of a system. Although we found that neither DEAMS's nor 
ECSS's risk management programs had identified the possibility of 
encountering different computer desktop configurations in use at 
deployment locations as a potential program risk for mitigation, they 
both acknowledged that future deployment of either system could be 
adversely affected by a lack of, or incomplete understanding of, the 
operating environment currently in use at a deployment location. 
Officials in both the DEAMS and ECSS program management offices stated 
that in the future, they intend to test computer desktop configurations 
at each location prior to deployment. 

The Air Force's transformation efforts do not reflect a coordinated, 
concerted effort or strategy for transforming its business operations 
and achieving stated Air Force or DOD enterprise goals, such as total 
asset visibility. For example, the Air Force Military Equipment 
Accountability Improvement Plan for supporting the department's 
military equipment valuation effort was not linked to the Air Force 
Logistics Enterprise Architecture Concept of Operations--the key 
business transformation plan for Air Force logistics.[Footnote 17] 
Additionally, the various Air Force plans generally did not include any 
metrics for measuring transformation progress. For instance, the Air 
Force Logistics Enterprise Architecture Concept of Operations 
identified two goals--increase equipment availability by 20 percent no 
later than fiscal year 2011 and reduce annual operating and support 
costs by 10 percent no later than fiscal year 2011. While these are 
notable goals, the plan did not identify any metrics for assessing 
incremental progress made in achieving these two goals or DOD business 
transformation priorities. Additionally, the Air Force has not 
established metrics to measure, monitor, and reliably report 
incremental progress in improving its ability to locate, manage, and 
account for assets throughout their life cycle. 

We are making three recommendations to the Secretary of Defense to 
improve the department's efforts to achieve total asset visibility, 
further enhance its efforts to improve control and accountability over 
business system investments, and achieve its business transformation 
priorities. Specifically, we recommend that the Secretary of Defense 
(1) direct the Air Force to provide risk management visibility at the 
ECSS and DEAMS program level to facilitate oversight and monitoring of 
risk management activities occurring throughout the programs; (2) 
direct the Air Force to direct ECSS and DEAMS program management 
offices to identify and mitigate key ECSS and DEAMS implementation 
risks before deployment, such as testing ECSS and DEAMS on relevant 
computer desktop configurations prior to deployment at a given 
location; and (3) direct the Air Force transformation activities to 
align their business transformation plans, including efforts aimed at 
achieving total asset visibility, with priorities included in DOD's 
Enterprise Transition Plan. 

We received written comments on a draft of this report from the Deputy 
Under Secretary of Defense (Business Transformation), which are 
reprinted in appendix II. DOD concurred with our recommendations and 
identified specific actions it plans to take to implement these 
recommendations. 

Background: 

In April 2003, the Secretary of Defense charged the military services 
with supporting six transformational objectives.[Footnote 18] These 
objectives not only included a reiteration of the department's goal to 
fully implement total asset visibility, but also clearly reflected a 
growing recognition of the importance of cost information in fulfilling 
the logistics mission. Further, when DOD released its first Enterprise 
Transition Plan in 2005, these objectives, including the importance of 
financial information visibility for use in decision making, were 
embodied into the department's six strategic business enterprise 
transformation priorities.[Footnote 19] Both DOD and the Air Force have 
initiatives under way to improve their ability to link financial 
resources to associated assets, programs, and activities or missions. 
For example, both the department and the Air Force have efforts 
underway, such as the Unique Item Identification and Radio Frequency 
Identification initiatives and the Standard Financial Information 
Structure (SFIS) initiative, to improve their ability to identify and 
track assets, including costs, throughout their life cycle.[Footnote 
20] 

The Air Force, as a DOD component, is confronted with similar 
management challenges that must be effectively resolved if it is to 
improve its business operations and in turn provide better support to 
the warfighter. The following highlights some of the asset management 
challenges the Air Force is attempting to resolve to achieve total 
asset visibility. 

Excess inventory. We have previously reported that more than half of 
the Air Force's secondary inventory (spare parts), worth an average of 
$31.4 billion, was not needed to support required on-hand and on-order 
inventory levels from fiscal years 2002 through 2005.[Footnote 21] The 
Air Force has continued to purchase unneeded on-order inventory because 
its policies do not provide incentives to reduce the amount of 
inventory on order that is not needed to support requirements. 

Financial management and reporting. The DOD Inspector General reported 
in November 2007, and the Air Force acknowledged, that the Air Force 
continues to have significant internal control deficiencies that impede 
the ability of its general and working capital funds to produce 
accurate and reliable information on the results of their operations. 
Deficiencies were found in the following areas: (1) financial 
management systems, (2) government furnished and contractor-acquired 
materiel (general fund), (3) environmental liabilities, (4) operating 
materials and supplies, (5) accounting entries, (6) property, plant, 
and equipment, and (7) in-transit inventory (working capital fund). 
[Footnote 22] 

Deployed assets. In January 2007, the Air Force Audit Agency reported 
that the Air Force had lost control and accountability over 5,800 
assets, valued at approximately $108 million, in part because its 
logistical systems did not provide Air Force personnel with the 
capability to effectively manage, track, and monitor deployed assets. 
[Footnote 23] For example, the system incorrectly reported that assets 
were deployed to closed bases. Additionally, the systems did not 
provide reliable asset information, such as asset quantities and 
location. As a result of these weaknesses, Air Force management did not 
have total asset visibility and was not able to determine if the right 
assets were at the right location to meet mission requirements. 

Government furnished material. In January 2007, the Air Force Audit 
Agency also reported that the Air Force did not effectively manage 
government furnished material.[Footnote 24] More specifically, the Air 
Force Audit Agency reported that the Air Force logistics personnel 
inappropriately provided government furnished material to contractors 
that were not authorized by contract documentation to receive this 
material. This problem could adversely affect mission support if the 
Air Force loses assets that should be in inventory. In addition, poor 
accountability controls increase the Air Force's susceptibility to 
fraud and misuse of government resources. 

Key DOD and Air Force Business Transformation Plans: 

Successful transformation of DOD's business operations, including the 
achievement of total asset visibility, will require a multifaceted, 
cross-organizational approach that addresses the contribution and 
alignment of key elements, including strategic plans, people, 
processes, and technology. The following highlights key DOD and Air 
Force transformation plans that are aimed at enhancing business 
operations and supporting the department's total asset visibility goal. 

Enterprise Transition Plan. DOD guidance states that the Enterprise 
Transition Plan is intended to provide a road map for achieving DOD's 
business transformation through technology, process, and governance 
improvements. According to DOD, the Enterprise Transition Plan is 
intended to summarize all levels of transition planning information 
(milestones, metrics, resource needs, and system migrations) as an 
integrated product for communicating and monitoring progress-- 
resulting in a consistent framework for setting priorities and 
evaluating plans, programs, and investments. DOD updates the Enterprise 
Transition Plan twice a year, once in March as part of DOD's annual 
report to Congress and again in September. Although the Enterprise 
Transition Plan provides an overall strategy and corresponding metrics 
for achieving each of the department's six business enterprise 
priorities, DOD officials have acknowledged improvements are needed in 
the plan to provide a clearer assessment of the department's 
transformation effort. DOD officials have also acknowledged the need 
for an integrated planning process and results-oriented measures to 
assess overall business transformation. 

Financial Improvement and Audit Readiness (FIAR) Plan. A major 
component of DOD's business transformation effort is the Defense FIAR 
Plan. The FIAR Plan is updated twice a year and is intended to provide 
DOD components with a framework (audit readiness strategy) for 
resolving problems affecting the accuracy, reliability, and timeliness 
of financial information and obtaining clean financial statement audit 
opinions. The FIAR Plan's audit readiness strategy consists of six 
phases: (1) discovery and correction, (2) segment assertion, (3) audit 
readiness validation, (4) audit readiness sustainment, (5) financial 
statement assertion, and (6) financial statement audit. Each military 
service is required to develop subordinate plans that are to support 
the FIAR Plan in achieving its objectives. 

Air Force Financial Management Strategic Plan for Fiscal Years 2007- 
2012. This plan identifies seven financial management goals for 
transforming the Air Force's financial management operations. Those 
goals are (1) foster mutual respect and integrity, (2) reduce Air Force 
cost structure, (3) expand partnership in strategic Air Force 
decisions, (4) recruit, prepare, and retain a well-trained and highly 
educated professional team for today and tomorrow, (5) provide 
customers with world-class financial services, (6) implement open, 
transparent business practices, and achieve a clean financial statement 
audit, and (7) continuously streamline financial management processes 
and increase capabilities. In addition, the plan also identifies 
specific objectives for each goal, some of the actions that will be 
taken to accomplish the objectives, and 13 financial management 
metrics. 

Air Force Logistics Enterprise Concept of Operations. This document 
presents a collection of high-level requirements for transforming Air 
Force logistics. It establishes the process framework, standards, and 
guidelines to define the environment in which future logistics systems 
can be identified, acquired, or built. Further, it aims to serve as a 
catalyst for developing doctrine, policies, and organizational 
structure consistent with the vision outlined in the Air Force 
Expeditionary Logistics for the 21st Century Campaign Plan, needed to 
enable logistics transformation. 

Air Force Information Reliability and Integration Action Plan/ 
Financial Improvement Plan. This plan describes actions planned to 
identify and address impediments to the Air Force's ability to achieve 
clean financial statement audit opinions. The Air Force Information 
Reliability and Integration Action Plan, commonly referred to as the 
Air Force Financial Improvement Plan, includes specific tasks, 
completion dates, start dates, owner/lead components, and points of 
contact for addressing weaknesses adversely affecting the reliability 
of individual Air Force financial statement line items and is intended 
to support the department's FIAR Plan. 

Air Force Military Equipment Accountability Improvement Plan. This plan 
is intended to define how the Air Force will implement measures to 
properly collect, account for, track, and report military equipment 
values. This plan is intended to identify the actions required to 
resolve any existing problems or impediments to achieving auditable 
values for military equipment items. The Air Force Military Equipment 
Accountability Improvement Plan is intended to be incorporated into the 
Air Force's Financial Improvement Plan and DOD's FIAR Plan. 

Improvements Are Needed in the Air Force's Approach for Acquiring and 
Implementing ECSS and DEAMS: 

ECSS and DEAMS are two business systems initiatives identified by the 
Air Force that are intended to help it address asset accountability 
weaknesses and achieve its total asset visibility goal. While these 
programs are intended to provide the Air Force with the full spectrum 
of logistics and financial management capabilities, our review 
identified areas where the Air Force had not fully implemented key best 
practices related to risk management for ECSS and DEAMS and system 
testing for DEAMS. 

ECSS and DEAMS Are Intended to Help the Air Force Achieve Total Asset 
Visibility: 

ECSS and DEAMS are intended to support the Air Force's efforts to 
transform its business operations and provide accurate, reliable, and 
timely information to support decision making and management of the Air 
Force's business operations, including total asset visibility. The ECSS 
program was initiated in January 2004 and is expected to provide a 
single, integrated logistics system, including transportation, supply, 
maintenance and repair, and other key business functions directly 
related to logistics, such as engineering and acquisition, at a total 
life-cycle cost over $3 billion. Initially, the Air Force anticipated 
achieving full operational capability of ECSS during fiscal year 2012. 
Due to delays as a result of two contract award protests, the Air Force 
now expects ECSS to reach full operational capability in fiscal year 
2013. When fully implemented, ECSS is expected to replace about 250 
legacy logistics and procurement (acquisition) systems and support over 
250,000 users Air Force-wide. ECSS is considered a key element in the 
Air Force's efforts to reengineer and transform its supply chain 
operations from a reactive posture to a more predictive posture that 
facilitates greater effectiveness and efficiency in the Air Force's 
logistics operations that support the warfighter. 

ECSS is intended to interface with DEAMS to provide the Air Force with 
improved financial visibility over Air Force assets. Additionally, 
implementation of ECSS is expected to address long-standing weaknesses 
in supply chain management, a DOD issue that has been on our high-risk 
list since 1990. In this regard, the redesign of the Air Force's supply 
chain operations, in part through implementation of ECSS, is expected 
to address four broad Air Force logistical issues: (1) lack of an 
enterprise view, (2) fragmented planning processes, (3) lack of process 
integration, and (4) no enterprise-level systems strategy. Figure 1 
provides information related to ECSS's timeline for implementation and 
funding. 

Figure 1: ECSS Timeline and Funding: 

[See PDF for image] 

This figure is a combination line graph and timeline depicting the 
following data: 

January 2004: Project initiation; 
December 2007: Amount obligated: $250 million; 
April 2010: Initial operational capability; 
June, 2013: Full operational capability; 
2023: Life cycle cost estimate: $3 billion. 

Source: GAO based on information provided by Air Force. 

[End of figure] 

Currently, the program is undergoing a process referred to as 
"blueprinting" to identify needed interfaces and data requirements. 
After blueprinting is completed in fiscal year 2009, the Air Force will 
begin system testing and initial implementation of ECSS. As of December 
2007, the Air Force reported that approximately $250 million had been 
obligated in total for the ECSS effort. 

As shown in figure 1, the Air Force estimates a total life-cycle cost 
of $3 billion; however, the total life-cycle cost of ECSS is likely to 
increase due to an Air Force decision to add functionality. In January 
2008, Air Force ECSS program management officials informed us that ECSS 
would assume financial management control and accountability, including 
invoice processing and financial reporting responsibility, for the Air 
Force's working capital fund operations. Prior to this decision, the 
Air Force had designated DEAMS as the business system initiative it 
intended to use to improve the financial management capabilities of 
both the Air Force's working capital and general funds. The Air Force 
is currently in the process of determining the cost of this decision 
and how much it will add to its already recognized funding shortfall 
for ECSS of approximately $697 million. According to ECSS program 
management office officials, ECSS's funding shortfall resulted from 
contract order award protests that caused stop-work actions. As a 
result of the stop-work actions, the ECSS program management office was 
not able to spend money for work as planned, which caused the Air Force 
to reallocate the money to other Air Force requirements, ultimately 
resulting in unfunded ECSS requirements. 

The DEAMS program was initiated in August 2003 and is expected to 
provide general fund accounting for the entire Air Force at a total 
life-cycle cost of over $1 billion.[Footnote 25] In the past, lack of 
integration between business systems, including logistics and financial 
management, have adversely affected the ability of DOD and the Air 
Force to control costs, ensure basic accountability, anticipate future 
costs and claims on the budget, measure performance, maintain funds 
control, and prevent fraud. If the information contained in asset and 
financial accountability systems is not accurate, complete, and timely, 
the Air Force's day-to-day operations could be adversely affected by, 
for example, investment in inventory that is not needed to meet current 
needs or for which the Air Force had not allocated sufficient resources 
or authority to purchase. Both physical and financial accountability 
are essential to achieving total asset visibility and DOD's objective 
of providing information to support decision making. 

According to Air Force officials, DEAMS will replace seven legacy 
accounting systems.[Footnote 26] As depicted in figure 2, Air Force 
program management officials expect DEAMS to reach initial operational 
capability[Footnote 27] during fiscal year 2011 and full operational 
capability[Footnote 28] by fiscal year 2014 with a total life-cycle 
cost of about $1.1 billion. DOD defines total life-cycle cost as the 
total cost to the government of acquisition and ownership of that 
system over its useful life. It includes the cost of acquisition, 
operations, and support (to include manpower), and where applicable, 
disposal. Figure 2 provides information related to DEAMS's timeline for 
implementation and funding. 

Figure 2: DEAMS Timeline and Funding: 

[See PDF for image] 

This figure is a combination line graph and timeline depicting the 
following data: 

August 2003: Project initiation; 
December 2007: Amount obligated: $119 million; 
February 2011: Initial operational capability; 
February 2014: Full operational capability; 
2021: Life cycle cost estimate: $1.1 billion. 

Source: GAO based on information provided by Air Force. 

[End of figure] 

The DEAMS business system initiative was approved by the Office of the 
Secretary of Defense Business Management Modernization Program's 
Financial Management Transformation Team[Footnote 29] as a joint United 
States Transportation Command (Transportation Command), Defense Finance 
and Accounting Service, and Air Force project. According to Air Force 
officials, DEAMS will be implemented in two increments--the first at 
the Transportation Command and the second at the Air Force. 

During the first incremental deployment of DEAMS, which began at Scott 
Air Force Base, Illinois, on July 27, 2007, approximately 200 users 
within the Transportation Command, the Air Force's Air Mobility Command 
component, and other selected tenant organizations at Scott Air Force 
Base, began to receive limited accounting capabilities (starting with 
commitment accounting). As of December 2007, the Air Force reported 
that approximately $119 million had been obligated for this system. By 
the end of the increment 1 deployment phase, which is expected to be 
completed by December 2010, DEAMS is intended to provide Scott Air 
Force Base with the entire spectrum of core financial management 
capabilities, including collections, commitments/obligations, cost 
accounting, general ledger, funds control, receipt and acceptance, 
accounts payable and disbursement, billing, and financial reporting. 
Deployment of DEAMS to an estimated 28,000 users at other Air Force 
locations will occur during the DEAMS increment 2 deployment phase. 

ECSS and DEAMS Programs Did Not Fully Embrace or Implement Key Business 
System Best Practices: 

The Air Force had not yet fully embraced or implemented key business 
system best practices in several areas. Best practices are tried and 
proven methods, processes, techniques, and activities that 
organizations define and use to minimize program risks and maximize the 
chances of a program's success.[Footnote 30] Collectively, these 
practices are intended to reasonably ensure that the investment in a 
given system represents the right solution to fill a mission need--and 
if the solution is right, that acquisition and deployment are done the 
right way, meaning that they maximize the chances of delivering defined 
system capabilities on time and within budget. Specifically, we found 
that the Air Force had not fully implemented key best practices related 
to risk management for ECSS and DEAMS and system testing for DEAMS. 
These findings increase the risk that these two business systems will 
not meet their stated functionality, cost, and milestone goals or 
effectively further the Air Force's efforts to achieve total asset 
visibility. 

ECSS and DEAMS Risk Management Programs Are Not Comprehensive and Do 
Not Provide Sufficient Detail to Effectively Oversee the Programs: 

The Air Force did not have reasonable assurance that its risk 
management process would accomplish its primary purpose--managing a 
program's risks to acceptable levels by taking the actions necessary to 
identify and mitigate the adverse effects of risks before they affect 
the program.[Footnote 31] The objective of a well-managed risk 
management program is to provide a repeatable process for balancing 
cost, schedule, and performance goals within program funding. According 
to DOD's Risk Management Guide for DOD Acquisition, risk management is 
most effective if it is fully integrated within a program.[Footnote 32] 
Our analysis of the ECSS and DEAMS risk management programs found that 
neither program used a comprehensive and fully integrated risk 
management process. Program risk was monitored, overseen, and managed 
independently by various groups or activities within the program 
without adequate visibility, at the program management level. Without 
adequate visibility of risk management activities programwide, the 
program management office has little assurance of the sufficiency of 
actions taken by its subordinate groups or activities to identify, 
analyze, and mitigate risk that may affect other groups or the program 
itself. A single risk management process for each program with clear 
linkages to subordinate risk management activities throughout the 
program would provide greater visibility and assurance that appropriate 
actions are taken to identify and address risks. Acquiring software is 
a risky endeavor and risk management processes are intended to help the 
program manager and senior leadership ensure that actions are taken to 
mitigate the adverse effects of each determined program risk. If 
program risks are not effectively communicated and managed, then the 
risks will manage the program, potentially leading to increased costs 
to ultimately address the impact of a realized risk or implement a 
program that does not provide the intended capabilities. The following 
highlights specific risk management issues that we identified within 
the Air Force's current approach. 

Interfaces. Our analysis of ECSS and DEAMS risk management processes 
found that even when risks were identified at lower levels within a 
program, the level of detail at the program level was not always 
sufficient to provide program managers with the visibility needed to 
effectively assess and manage certain risks at those levels. Although 
the ECSS and DEAMS program management offices identified interfaces as 
potential areas of risk at lower levels within the program, we found 
that neither program management office consistently identified 
interfaces as a risk at the program level. In the case of DEAMS, the 
information in the program level risk management system did not 
disclose that 70 key interfaces must be dealt with in order to 
implement the system, even though this level of detail was maintained 
at a lower level by the DEAMS Interface and Conversion Group. Without 
visibility of risks identified at all levels of a program, it is 
difficult, if not impossible, for the program manager or other senior- 
level officials to ascertain if the various risks that are associated 
with a program of this magnitude are effectively identified and 
managed. We have previously reported that interfaces are critical 
elements necessary to successfully implement a new system and failure 
to properly address risk in interface areas has contributed to the 
system failures of previous agency efforts.[Footnote 33] 

Data conversion. In implementing ECSS and DEAMS, the Air Force will 
have to expend considerable resources to clean-up and transfer the data 
in the existing legacy systems to ECSS or DEAMS. However, we found that 
only the ECSS risk management program identified data quality as an 
issue in its discussion of data conversion. Much like system 
interfaces, each effort to convert data needs to be separately 
identified and managed so that (1) the risks associated with a given 
effort can be identified, (2) adequate mitigating actions can be 
developed for those risks, and (3) the effectiveness of the mitigating 
actions can be monitored. For example, in June 2005, we reported that 
data conversion problems seriously affected the Army's ability to 
implement its Logistics Modernization Program at the Tobyhanna Army 
Depot, Tobyhanna, Pennsylvania.[Footnote 34] These problems affected 
reporting of revenue earned, accountability over orders received from 
customers, and prepared billings. As discussed in our July 2007 report, 
the Army and its contractor still had not resolved the issues of 
customers being improperly billed.[Footnote 35] 

Change management. The DEAMS program management office did not identify 
change management as a risk in its risk management system; however, it 
was included as a risk by the ECSS program management office. Change 
management is the process of preparing users for the changes that 
should occur with the implementation of a new system. It involves 
engaging users and communicating the nature of anticipated changes to 
system users through training on how jobs will change. This is 
necessary because commercial products are created with the developers' 
expectations of how they will be used, and the products' functionality 
may require the organization implementing the system to change existing 
business processes. However, neither the ECSS or DEAMS program had 
identified training as a potential change management risk at the 
program level. As discussed previously, the lack of sufficient 
transparency of risks identified by the lower levels at the program 
level may impede the ability of ECSS and DEAMS program managers and 
senior-level officials to ensure that risks are effectively mitigated. 
Further, the lack of centralized visibility may also minimize program 
efficiencies that could be gained through shared knowledge of risks 
identified by other groups within the program and actions planned or 
taken to mitigate them. As we have previously reported, having staff 
with the appropriate skills is a key element for achieving financial 
management improvement.[Footnote 36] The implementation of a new system 
is intended to bring about improvements in the way an entity performs 
its day-to-day business operations. We have issued several reports that 
associated the lack of effective change management to program schedule 
slippages.[Footnote 37] Unless those intended changes are clearly 
identified and communicated to the affected employees, the changes in 
the organization's business processes may not occur or be less 
effective and efficient than envisioned. 

Contractor oversight. The Air Force's ability to manage these two 
programs--including oversight of contractors--is critical to reducing 
the risks to acceptable levels. Both ECSS and DEAMS program management 
officials identified staffing shortfalls within their respective 
offices as program risks. In addition, both offices identified actions 
needed to mitigate the impact the shortfalls may have on their 
programs. However, neither program management office considered whether 
their programs had staff with the appropriate skill sets to effectively 
oversee and manage their respective contractors. Since the contractors 
for each program are performing many of the key tasks, including how 
the system will perform and what information or capabilities it will 
provide, it is critical that the Air Force have an effective monitoring 
process to oversee the contractors and ensure that the project 
management processes employed by contractors were effectively 
implemented. 

During discussions on their respective programs, in March 2008, both 
ECSS and DEAMS program management officials stated that they thought 
their existing risk management programs provided adequate visibility 
over risks within their respective programs. However, after discussing 
our concerns with the program management officials, they agreed with us 
that their program level risk management programs could be improved to 
provide better links to the various risks identified and the risk 
management processes used by the groups within their programs. They 
also agreed that this would help them achieve reasonable assurance that 
their decentralized risk management program is achieving the objectives 
of a more traditional centralized risk management process. 

More Robust Testing of the Operating Environments at Planned Deployment 
Locations Is Needed to Minimize Delays: 

A limited version of DEAMS was deployed at Scott Air Force Base in July 
2007. A follow-on deployment[Footnote 38] intended to provide DEAMS 
functionality to additional users, originally scheduled for October 
2007, was placed on hold to address a series of software and 
connectivity issues that were identified after the initial deployment. 
[Footnote 39] According to Air Force DEAMS program management 
officials, DEAMS was functioning as intended on the older Air Force 
standard computer desktop configuration; however, problems occurred 
when the system was deployed to offices that were utilizing a newer 
computer desktop configuration than the one the program management 
office had utilized in its initial tests. Air Force DEAMS program 
management officials stated that they did not include the potential of 
encountering different operating environments at deployment locations 
as a potential program risk because they thought that there was a 
standard computer desktop configuration across the Air Force and 
therefore the risk was remote. DEAMS program management officials 
acknowledged that the standardization of computer desktops across the 
Air Force is a major challenge and that encountering it during the 
DEAMS deployment at Scott Air Force Base was a "lessons learned." 

Further, DEAMS program management officials stated that system 
"patches" to address the problem have been tested on multiple computer 
desktop configurations at Scott Air Force Base to ensure that DEAMS 
operates as intended at that location. According to DEAMS program 
management officials, they started the redeployment of DEAMS at the end 
of March 2008, and they do not anticipate that this will result in a 
significant delay, if any, toward achieving full deployment of DEAMS 
within fiscal year 2014. 

However, unless the DEAMS program management office obtains a clear 
understanding of the environment in which DEAMS will be deployed, DEAMS 
will likely suffer additional implementation delays. Further, ECSS is 
also likely to encounter nonstandardized computer desktop 
configurations during its deployment. Both ECSS and DEAMS program 
management officials acknowledged that nonstandardized computer desktop 
configurations will continue to represent a potential program risk and 
indicated that they intend to test desktop configurations at each 
deployment location in the future. DEAMS program management officials 
are working with its contractor and other Air Force personnel to 
develop a long-term solution for the DEAMS program. 

Better Integration Is Needed to Ensure That the Air Force's Business 
Transformation Plans Support DOD Business Transformation Priorities and 
Total Asset Visibility: 

Viewed from a broad perspective, the Air Force does not have a single 
comprehensive plan or integrated set of plans to support DOD business 
transformation priorities, transform Air Force business operations, and 
achieve total asset visibility. Rather, the Air Force is utilizing 
several individual business transformation plans and efforts. Our 
analysis of these plans disclosed that they are neither fully 
integrated with each other nor are they fully aligned with business 
transformation priorities and related performance measures or metrics 
outlined in DOD's Enterprise Transition Plan. Integration and 
coordination of improvement efforts within a component and clear 
alignment of those efforts with DOD's Enterprise Transition Plan is 
necessary to achieve both the components' and DOD's business 
transformation priorities and goals, including total asset visibility. 
Without clear alignment of transformation plans, priorities, and 
metrics, both DOD and the Air Force will have difficulty (1) ensuring 
that transformation efforts, such as ECSS and DEAMS, are efficiently 
and effectively directed at achieving DOD's business transformation 
priorities/goals, including total asset visibility, and (2) measuring 
and reporting on progress toward the capabilities necessary for 
achieving an intended business transformation priority, such as 
financial and materiel visibility. Air Force officials acknowledged 
that integration of their plans within the Air Force and with the DOD's 
Enterprise Transition Plan could be improved and indicated that they 
intend to make improvements to their plans. By not fully aligning and 
integrating these transformation strategies and plans, the Air Force 
risks falling short of significantly enhancing its ability to provide 
the right equipment and materiel, in the right condition, at the 
correct place, when needed to support the warfighter. 

DOD Business Priorities Are Not Clearly Identified in Key Air Force 
Business Transformation Plans: 

Our review of several Air Force strategic documents and plans, such as 
its Financial Management Strategic Plan, Accountability Improvement 
Plan, and Logistics Enterprise Architecture Concept of Operations, 
found that the plans were not clearly linked to each other or with 
DOD's Enterprise Transition Plan. 

Air Force Financial Management Strategic Plan. This plan outlines seven 
goals for transforming Air Force financial management.[Footnote 40] 
However, the plan contains no reference to the priorities, objectives, 
or capabilities identified in DOD's Enterprise Transition Plan. 
Additionally, the Air Force Financial Management Strategic Plan does 
not identify any performance measures or metrics that the Air Force 
intends to use to measure incremental progress toward achieving its own 
stated financial management goals or DOD's business transformation 
priorities. It is also unclear how certain Air Force financial 
management goals, such as to "foster mutual respect and integrity" or 
"recruit, prepare, and retain a well-trained and highly educated 
professional team for today and tomorrow," specifically relate to 
achieving the four financial visibility objectives identified in DOD's 
Enterprise Transition Plan: (1) produce and interpret relevant, 
accurate, and timely financial information that is readily available 
for analyses and decision making, (2) link resource allocation to 
planned and actual business outcomes and warfighter missions, (3) 
produce comparable financial information across organizations, and (4) 
achieve audit readiness and prepare auditable financial statements. 

Air Force Military Equipment Accountability Improvement Plan. This plan 
is intended to support the department's valuation of military equipment 
and the Air Force's and DOD's goal to obtain auditable financial 
statements. However, the relationship between the Air Force Military 
Equipment Accountability Improvement Plan to other Air Force 
transformation plans or initiatives, such as the Air Force Logistics 
Enterprise Architecture Concept of Operations, in transforming the Air 
Force's business operations is not articulated in the plan. For 
example, although the Under Secretary of Defense for Acquisition, 
Logistics, and Technology tasked the Air Force and other military 
components with preparing a military equipment accountability 
improvement plan, the plan does not explain how resolution of these 
problems will support the Air Force's logistics goals to improve 
operational capability, while minimizing the cost to deliver 
capability. Further, the Air Force Military Equipment Accountability 
Improvement Plan does not discuss how its efforts contribute, 
individually or as part of a collective Air Force effort, to 
incremental and measurable improvements in the visibility of Air Force 
logistical and financial information for decision making, analysis, and 
reporting--a key transformation priority identified in DOD's Enterprise 
Transition Plan. 

The Air Force Lacks Business Transformation Performance Metrics 
Consistent with DOD's Enterprise Transition Plan: 

None of the various Air Force strategic plans we analyzed included 
performance measures or metrics that could be used to systematically 
assess and report on transformation progress. Without adequate metrics, 
both Air Force and DOD management face a difficult challenge in 
monitoring implementation of Air Force plans and assessing the Air 
Force's progress in improving its processes, controls, and systems and 
achieving DOD's business transformation priorities, including total 
asset visibility. Our prior work has identified at least four 
characteristics common to successful hierarchies of performance 
measures or metrics: (1) demonstrated results, (2) limited to a vital 
few, (3) corresponding to multiple priorities, and (4) linked to 
responsible programs.[Footnote 41] Simply stated, performance measures 
should tell each organizational level how well it is achieving its own 
and shared goals and priorities. Examples of the lack of consistent 
metrics follow. 

Air Force Logistics Enterprise Architecture Concept of Operations. None 
of the six materiel visibility business capability improvement metrics 
included in the DOD Enterprise Transition Plan are identified in the 
Air Force Logistics Enterprise Architecture Concept of Operations. 
Further, the Air Force Logistics Enterprise Architecture Concept of 
Operations identified only two measures or goals: (1) increase 
equipment availability by 20 percent no later than fiscal year 2011 and 
(2) reduce annual operating and support cost by 10 percent no later 
than fiscal year 2011. While these are notable goals, these metrics do 
not provide a means to measure incremental progress in improving the 
Air Force's ability to locate and account for materiel assets 
throughout their life cycle. 

Air Force Financial Management Strategic Plan. This plan identified 13 
metrics, some of which pertained to reducing interest penalties paid, 
lost discounts, and unmatched disbursements, to support an assessment 
of the current state of the Air Force's financial management. However, 
the Air Force Financial Management Strategic Plan did not include 
metrics that the Air Force can use to measure the progress of its 
various financial management initiatives in transforming the Air 
Force's financial management and related business operations and 
achieving DOD business transformation priorities. For example, none of 
the 13 metrics outlined in the Air Force Financial Management Strategic 
Plan could be used to measure, monitor, or report incremental progress 
toward producing and interpreting relevant, accurate and timely 
financial information that is readily available for analyses and 
decision making--a key financial visibility objective identified in 
DOD's Enterprise Transition Plan. 

Air Force Military Equipment Accountability Improvement Plan and its 
Financial Improvement Plan. Neither plan included performance metrics 
to measure the effectiveness of planned actions to resolve identified 
weaknesses that have adversely affected the reliability of reported 
financial and physical accountability information. Specifically, we 
found that the Air Force's status reporting for both initiatives 
consisted primarily of the completion of milestone dates associated 
with steps outlined by DOD in its FIAR Plan for achieving auditability 
of its financial statements. As a result, the Accountability 
Improvement Plan and the Financial Improvement Plan provide little 
information on incremental improvements made in the Air Force's 
financial management capabilities, including decision making support. 
Moreover, when we compared the Financial Improvement Plans dated August 
1, 2007, and October 11, 2007, we identified numerous inconsistencies 
that raise concerns regarding the oversight and monitoring provided to 
these plans and their reported progress. For example, we found: 

* 211 of the total 1,762 tasks in the October 2007 Financial 
Improvement Plan had completion dates identified as prior to October 1, 
2007; however, the reported progress toward completion for each of 
these tasks was identified as zero, and: 

* 61 of the total 1,279 tasks that were included in both the August 
2007 and October 2007 Financial Improvement Plans showed a decline in 
the percentage completion total reported for the same tasks between the 
two plans. 

Conclusion: 

The Air Force's efforts to transform its logistics and financial 
management operations through system, process, and control changes are 
being guided by numerous strategies and plans that are not fully 
integrated within the Air Force and with DOD's business enterprise 
transformation priorities. As the Air Force deploys ECSS and DEAMS, it 
is important that it utilize a comprehensive and integrated risk 
management process to identify, analyze, and mitigate risks and 
configuration issues that may impede successful deployment of these 
systems throughout the Air Force, such as testing computer desktop 
configurations at each deployment location. Additionally, successful 
transformation will require a comprehensive plan or integrated set of 
plans and effective processes and tools, such as results-oriented 
performance measures that link enterprise and unit goals and 
expectations, for measuring, monitoring, and reporting progress in 
accomplishing the department's priorities. Until the Air Force's 
efforts are aligned within the Air Force and with DOD's business 
transformation priorities, and best practices are fully adopted to 
minimize risk and maximize chances for success, the risk increases that 
billions of dollars will be wasted and the efforts will not achieve the 
transformation envisioned for the future. 

Recommendations for Executive Action: 

To improve the department's efforts to achieve total asset visibility 
and further enhance its efforts to improve control and accountability 
over business system investments and achieve its business 
transformation priorities, we recommend that the Secretary of Defense 
direct the Secretary of the Air Force to take the following three 
actions: 

* Direct Air Force program management officials for ECSS and DEAMS to 
ensure that risk management activities at all levels of the program are 
identified and communicated to program management to facilitate 
oversight and monitoring. Key risks described at the appropriate level 
of detail should include and not be limited to risks associated with 
interfaces, data conversion, change management, and contractor 
oversight. 

* Direct the Air Force program management offices to test ECSS and 
DEAMS on relevant computer desktop configurations prior to deployment 
at a given location. 

* Direct Air Force organizations responsible for the business 
transformation plans discussed in this report to align their respective 
plans, including efforts aimed at achieving total asset visibility, 
with priorities included in DOD's Enterprise Transition Plan. Further, 
these plans should include metrics to measure, monitor, and report 
progress in accomplishing the business priorities identified in DOD's 
Enterprise Transition Plan. 

Agency Comments and Our Evaluation: 

We received written comments on a draft of this report from the Deputy 
Under Secretary of Defense (Business Transformation), which are 
reprinted in appendix II. DOD concurred with our recommendations and 
identified specific actions it plans to take to implement these 
recommendations. For example, the ECSS program management office has 
added GAO-identified risks to its inventory of program risks. 
Additionally, the DEAMS program management office intends to centralize 
two subordinate risk management activities into a single program-level 
risk management process. Further, in its rewrite of the DEAMS program 
charter for the department's Business Capability Lifecycle process, the 
DEAMS program management office stated its intent to implement a 
program-based risk management process that addresses all risk areas 
noted by GAO. In addition, the department noted that the Air Force is 
updating its Financial Improvement Plan to assure alignment with the 
department's Financial Improvement and Audit Readiness plan. DOD stated 
that the Air Force will ensure that the Financial Improvement Plan is 
aligned to the Air Force Financial Management Strategic Plan and DOD's 
Enterprise Transition Plan. 

We are sending copies of this report to the Secretary of Defense; 
Secretary of the Air Force; Deputy Under Secretary of Defense (Business 
Transformation); Assistant Secretary of the Air Force (Financial 
Management and Comptroller); Air Force Chief Information Officer; Air 
Force Deputy Chief of Staff (Logistics); and other interested 
congressional committees and members. Copies of this report will be 
made available to others upon request. In addition, this report is 
available at no charge on the GAO Web site at [hyperlink, 
http://www.gao.gov]. 

Please contact Paula M. Rascona at (202) 512-9095 or rasconap@gao.gov, 
Nabajyoti Barkakati at (202) 512-4499 or barkakatin@gao.gov, or William 
M. Solis at (202) 512-8365 or solisw@gao.gov if you or your staff have 
questions on matters discussed in this report. Contact points for our 
Offices of Congressional Relations and Public Affairs may be found on 
the last page of this report. Key contributors to this report are 
listed in appendix III. 

Signed by: 

Paula M. Rascona: 
Director, Financial Management and Assurance: 

Signed by: 

Nabajyoti Barkakati: 
Acting Chief Technologist: 
Applied Research and Methods: 
Center for Technology and Engineering: 

Signed by: 

William M. Solis: 
Director, Defense Capabilities and Management: 

[End of section] 

Appendix I: Scope and Methodology: 

In order to determine the implementation status of the Air Force's 
current business system initiatives to achieve total asset visibility, 
and whether the Air Force has implemented related best practices, 
[Footnote 42] we reviewed Air Force business system budget 
documentation and met with Air Force Chief Information Officer 
personnel and DOD Business Transformation officials. Most of the 
financial information in this report related to ECSS and DEAMS was 
obtained from the respective program management offices and is 
presented for informational purposes only; it was not used to develop 
our findings and recommendations. We interviewed, obtained briefings, 
and reviewed documentation provided by ECSS and DEAMS Air Force program 
management officials, Business Transformation Agency officials, and Air 
Force Financial Management and Comptroller officials to further our 
understanding of the intended purpose of each system and their 
respective roles in supporting the Air Force's efforts to achieve total 
asset visibility and transform its business operations. During this 
audit, we did not review ECSS and DEAMS compliance with the Air Force's 
enterprise architecture because of ongoing GAO work focused on 
ascertaining the status of the military services' efforts to develop 
and utilize an enterprise architecture. The results of our work are 
discussed in our May 2008 report,[Footnote 43] which noted that while 
the Air Force's efforts to develop an enterprise architecture were 
further ahead of Army and Navy efforts, the Air Force's architecture 
was not sufficiently developed to guide and constrain its business 
systems modernization investments. 

To determine whether any improvements were needed in the Air Force's 
approach for acquiring and implementing these business systems, we 
evaluated the ECSS and DEAMS risk management programs, reviewed Air 
Force guidance related to risk management, and obtained an explanation 
from each program management office on how they managed their 
respective risk management program. Additionally, we analyzed risk 
management reports that were prepared by each program management office 
and reviewed risk management briefings that were presented to senior 
Air Force management. We compared risk management reports for both 
programs with applicable Air Force guidance to ascertain if each 
program identified the risks that are associated with the acquisition 
and implementation of a system.[Footnote 44] 

To determine whether the Air Force's business transformation efforts to 
achieve total asset visibility are aligned within the Air Force and 
with DOD's broader business transformation priorities, we interviewed 
officials from the Air Force's Financial Management and Comptroller 
Office and the Air Force Logistics Enterprise Architecture and ECSS 
Transformation Management Division. There are many DOD and Air Force 
transformation plans and initiatives, such as DOD's Enterprise 
Transition Plan and Quadrennial Defense Review Report, and the Air 
Force Strategic Plan and the Air Force Smart Operations for the 21st 
Century. However, following discussions with Air Force officials, we 
focused our review on the Air Force Financial Management Strategic Plan 
for fiscal years 2007-2012, Logistics Enterprise Architecture Concept 
of Operations, Financial Improvement Plan for August 2007 and October 
2007, and Military Equipment Accountability Improvement Plan issued in 
December 2006 because they are more directly related to total asset 
visibility and related business transformation efforts. We analyzed and 
compared these documents to assess consistency among the plans and 
approaches both within the Air Force and with DOD's Enterprise 
Transition Plan's business transformation priorities and metrics. 

We conducted this performance audit from July 2007 through August 2008 
in accordance with generally accepted government auditing standards. 
Those standards require that we plan and perform the audit to obtain 
sufficient, appropriate evidence to provide a reasonable basis for our 
findings and conclusions based on our audit objectives. We believe that 
the evidence obtained provides a reasonable basis for our findings and 
conclusions based on our audit objectives. Most of the financial 
information in this report related to the ECSS and DEAMS programs was 
obtained from the respective program management offices and is 
presented for informational purposes only and was not used to develop 
our findings and recommendations. To assess the reliability of the 
funding data, we interviewed Air Force program management office 
officials knowledgeable about funding and reviewed budgetary data on 
the Air Force's investment in ECSS and DEAMS. We conducted our work at 
the DOD Business Transformation Agency, the Air Force Chief Information 
Officer Office, the Air Force Financial Management and Comptroller 
Office, and the Air Force Logistics Enterprise Architecture and ECSS 
Transformation Management Division in Arlington, Virginia. 
Additionally, we made site visits to the Air Force program management 
offices for ECSS and DEAMS at Wright-Patterson Air Force Base in 
Dayton, Ohio. We requested comments on a draft of this report from the 
Secretary of Defense or his designee. We received written comments from 
the Deputy Under Secretary of Defense (Business Transformation), which 
are reprinted in appendix II. 

[End of section] 

Appendix II: Comments from the Department of Defense: 

Office Of The Under Secretary Of Defense: 
Acquisition Technology And Logistics: 
3000 Defense Pentagon: 
Washington, DC 20301-3000: 

July 30, 2008: 

Ms. Paula M. Rascona: 
Director, Financial Management and Assurance: 
U.S. Government Accountability Office: 
441 G Street, N.W. 
Washington, DC 20548: 

Dear Ms. Rascona: 

This is the Department of Defense (DoD) response to the GAO draft 
report GAO-08-866, "DOD Business Transformation: Air Force's Current 
Approach Increases Risk that Asset Visibility Goals and Transformation 
Priorities Will Not be Achieved," dated June 23, 2008 (GAO Code 
195116). Detailed comments on the report recommendations are enclosed. 

DoD concurred with the three recommendations issued by GAO. Overall, 
the Department considers the recommendations to be representative of 
best practices that are currently being followed by the Air Force. The 
Air Force is currently taking additional steps to address some of GAO's 
specific findings, to include strengthening existing risk management 
processes, and revising its plans as appropriate to better reflect 
alignment with priorities defined in the Department's Enterprise 
Transition Plan (ETP). 

We welcome the GAO's insight on the Department's progress with its 
business transformation efforts and continue to value our partnership. 

Sincerely, 

Signed by: 

Paul A. Brinkley: 
Deputy Under Secretary of Defense (Business Transformation): 

Enclosure: As stated: 

GAO Draft Report Dated June 23, 2008: 
GAO-08-866 (GAO Code 195116): 

"DOD Business Transformation: Air Force's Current Approach Increases 
Risk That Asset Visibility Goals And Transformation Priorities Will Not 
Be Achieved" 

Department Of Defense Comments To The GAO Recommendations: 

Recommendation 1: The GAO recommends that the Secretary of Defense 
direct the Secretary of the Air Force to direct Air Force program 
management officials for Expeditionary Combat Support System (ECSS) and 
Defense Enterprise Accounting and Management System (DEAMS) to ensure 
that risk management activities at all levels of the program are 
identified and communicated to program management to facilitate 
oversight and monitoring. Key risks described at the appropriate level 
of detail should include and not be limited to interfaces, data 
conversion, change management, and contractor oversight. (Page 37/GAO 
Draft Report) 

DOD Response: Concur. While both the ECSS and DEAMS program offices 
have already implemented risk management processes that include 
identifying and communicating program risks to program management, they 
are currently taking steps to further strengthen their existing 
processes. For example, the ECSS program office has added GAO-
recommended risks to its inventory, and the DEAMS program office 
intends to centralize two subordinate risk management programs 
(Increments 1 and 2) into a single program-level Risk Management 
Program that will be managed by a Government employee accountable to 
the DEAMS Deputy Program Manager. Further, in its rewrite of the DEAMS 
Program Charter for the Department's Business Capability Lifecycle 
(BCL) process, the DEAMS program office intends to codify a program-
based risk management process which addresses all risk areas noted by 
the GAO. 

Recommendation 2: The GAO recommends that the Secretary of Defense 
direct the Secretary of the Air Force to direct the Air Force program 
management offices to test ECSS and DEAMS on relevant computer desktop 
configurations prior to deployment at a given location. (Page 37/GAO 
Draft Report) 

DOD Response: Concur. As a sound management practice, prior to 
deployment go-live, the DEAMS program office tested the program on all 
user desktop configurations. Additionally, informal unit desktop 
testing was conducted prior to each unit's initial deployment. As a 
result of the informal testing, the standard desktop configuration 
(SDC)-DEAMS conflict that GAO noted in its report was discovered one 
week prior to the Air National Guard Wave-2 deployment of DEAMS and 
action was taken to mitigate the issue and reduce the likelihood of its 
future occurrence. However, the SDC conflict was a minimal risk, and 
the Department views the issue as a "lesson learned" for future 
Enterprise Resource Planning (ERP) implementation. 

Recommendation 3: The GAO recommends that the Secretary of Defense 
direct the Secretary of the Air Force to direct Air Force organizations 
responsible for the respective business transformation plans discussed 
in this report to align their respective plans, including efforts aimed 
at achieving total asset visibility, with priorities included in DoD's 
Enterprise Transition Plan. (Page 38/GAO Draft Report) 

DOD Response: Concur. The ETP and Business Enterprise Architecture 
(BEA) guide the Air Force's efforts to transform its logistics and 
financial management operations, and the Air Force identifies and 
corrects anomalies within its business transformation plans to better 
demonstrate alignment with ETP priorities as needed, to include working 
with Department organizations at the Office of the Secretary of Defense 
(OSD)-level to resolve issues that impact the accurate reporting of key 
milestones and metrics. 

Currently, the Air Force is updating its Financial Improvement Plan 
(FIP) to assure alignment with the new OSD Financial Improvement and 
Readiness (FIAR) plan. The Air Force will ensure that the FIP is 
aligned to the Office of the Secretary of the Air Force/Financial 
Management (SAF/FM) Strategic Plan, the ETP, and the updated OSD 
policy. 

[End of section] 

Appendix III: GAO Contacts and Staff Acknowledgments: 

GAO Contacts: 

Paula M. Rascona, (202) 512-9095 or rasconap@gao.gov: 

Nabajyoti Barkakati, (202) 512-4499 or barkakatin@gao.gov: 

William M. Solis, (202) 512-8365 or solisw@gao.gov: 

Acknowledgments: 

In addition to the above contacts, the following individuals made key 
contributions to this report: J. Christopher Martin, Senior-Level 
Technologist; Darby Smith, Assistant Director; Evelyn Logue, Assistant 
Director; F. Abe Dymond, Assistant General Counsel; Beatrice Alff; 
Harold Brumm, Jr.; Francine DelVecchio; Jason Kelly; Jason Kirwan; 
Chanetta Reed; Debra Rucker; and Tory Wudtke. 

[End of section] 

Footnotes: 

[1] Supply chain management is the management of all processes or 
functions to satisfy a customer's product or service order. 

[2] DOD defines logistics as the science of planning and carrying out 
the movement and maintenance of forces. Logistics includes the aspects 
of military operations that deal with (1) design and development 
acquisition, storage, movement, distribution, maintenance, evacuation, 
and disposition of materiel; (2) movement, evacuation, and 
hospitalization of personnel; (3) acquisition or construction, 
maintenance, operation, and disposition of facilities; and (4) 
acquisition or furnishing of services. 

[3] GAO, High-Risk Series: An Update, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-07-310] (Washington, D.C.: 
January 2007). 

[4] [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-07-310]. 

[5] The eight specific DOD high-risk areas are (1) business 
transformation, (2) business systems modernization, (3) contract 
management, (4) financial management, (5) personnel security clearance, 
(6) supply chain management, (7) support system infrastructure, and (8) 
weapon systems acquisition. 

[6] The seven high-risk areas that DOD shares responsibility for are 
(1) disability programs, (2) information sharing for homeland security, 
(3) information security and critical infrastructure, (4) interagency 
contracting, (5) human capital, (6) real property, and (7) technologies 
critical to national security. 

[7] GAO, Best Management Practices: Reengineering the Air Force's 
Logistics Systems Can Yield Substantial Savings, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO/NSIAD-96-5] (Washington, D.C.: 
Feb. 21, 1996). 

[8] GAO, Defense Inventory: Opportunities Exist to Save Billions by 
Reducing Air Force's Unneeded Spare Parts Inventory, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-07-232] (Washington, D.C.: Apr. 
27, 2007). 

[9] Air Force, Air Force Expeditionary Logistics for the 21st Century 
Campaign Plan. 

[10] Air Force, Air Force Expeditionary Logistics for the 21st Century 
Campaign Plan. 

[11] The general fund can be defined as the fund into which all 
receipts of the United States government are deposited, except those 
from specific sources required by law to be deposited into other 
designated funds and from which appropriations are made by Congress to 
carry on the general and ordinary operations of the government. 

[12] A working capital fund is an intragovernmental revolving fund that 
conducts continuing cycles of business-like activity mainly within and 
between government agencies, in which the fund charges for the sale of 
products or services and uses the proceeds to finance its spending, 
usually without requirement for annual appropriations. 

[13] GAO, DOD Business Transformation: Lack of an Integrated Strategy 
Puts the Army's Asset Visibility Systems Investments at Risk, 
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-07-860] (Washington, 
D.C.: July 27, 2007). 

[14] Basis for best practices were derived from the following 
publications: Steve McConnell, Rapid Development: Taming Wild Software 
Schedules (Redmond, WA: Microsoft Press, 1996), Hubert F. Hofmann, 
Deborah K. Yedlin, John W. Mishler, and Susan Kushner, CMMI for 
Outsourcing: Guidelines for Software, Systems, and IT Acquisition, SEI 
Series in Software Engineering (Boston, MA: Addison-Wesley 
Professional, 2007), Department of Defense, Risk Management Guide for 
DOD Acquisition, Sixth Edition, Version 1.0, (August 2006), and GAO, 
Information Technology: DOD's Acquisition Policies and Guidance Need to 
Incorporate Additional Best Practices and Controls, GAO-04-722 
(Washington, D.C.: July 30, 2004). 

[15] GAO, DOD Business Systems Modernization: Military Departments Need 
to Strengthen Management of Enterprise Architecture Programs, 
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-08-519] (Washington, 
D.C.: May 12, 2008). 

[16] This includes financial management and related business 
capabilities, such as collections, commitment/obligations, cost 
accounting, general ledger, funds control, receipt and acceptance, 
accounts payable, disbursements, and billings. 

[17] Air Force, United States Air Force Military Equipment 
Accountability Improvement Plan, (December 2006). 

[18] The six transformational objectives are (1) optimize support to 
the warfighter, (2) improve strategic mobility to meet operations 
requirements, (3) implement customer wait time as a cascading metric, 
(4) fully implement total asset visibility, (5) reengineer applicable 
processes and systems to increase overall communication and operational 
situational awareness, and (6) achieve best-value logistics while 
meeting requirements at reduced operating costs. 

[19] The six DOD business transformation priorities are (1) personnel 
visibility, (2) acquisition visibility, (3) common supplier engagement, 
(4) materiel visibility, (5) real property accountability, and (6) 
financial visibility. 

[20] SFIS is intended to provide a standardized DOD-wide financial 
information structure to facilitate improved cost accounting, analysis, 
and reporting. 

[21] [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-07-232]. 

[22] DOD Inspector General, Independent Auditor's Report on the FY 2007 
Air Force General Fund Financial Statements, Report No. D2008-010 
(Arlington, VA: Nov. 8, 2007) and Independent Auditor's Report on the 
Air Force FY 2007 Working Capital Fund Financial Statements, Report No. 
D2008-011 (Arlington, VA: Nov. 8, 2007). 

[23] Air Force Audit Agency, Deployed Assets, F2007-0004-FC4000 
(Washington, D.C.: Jan. 26, 2007). 

[24] Air Force Audit Agency, Government Furnished Material, F2007-0003- 
FC4000 (Washington, D.C.: Jan. 26, 2007). 

[25] General fund accounting includes such financial management and 
related business capabilities as collections, commitment/obligations, 
cost accounting, general ledger, funds control, receipt and acceptance, 
accounts payable, disbursements, and billings. 

[26] DEAMS is intended to replace the following legacy accounting 
systems: (1) Cargo and Billing System, (2) Transportation Financial 
Management System-Military Traffic Management Command, (3) Airlift 
Services Industrial Fund Integrated Computer System, (4) Automated 
Business Services System, (5) Base Accounts Receivable System, (6) 
General Accounting and Finance System (Base-level/rehost), and (7) 
Integrated Accounts Payable System. 

[27] Initial operational capability is achieved when a system is 
implemented with some minimal capabilities and additional capabilities 
are planned before the system is determined to have reached full 
operational capability. 

[28] Full operational capability means that the system has been 
deployed as intended to all planned locations. 

[29] The Business Management Modernization Program was the approval 
authority for business systems investment efforts in 2003. Currently, 
the Defense Business Systems Management Committee is the approval 
authority for business systems investments. 

[30] Best practices associated with risk management programs and system 
testing were derived from the following publications: Department of 
Defense, Risk Management Guide for DOD Acquisition, sixth edition, 
Version 1.0, (August 2006), Steve McConnell, Rapid Development: Taming 
Wild Software Schedules (Redmond, WA: Microsoft Press, 1996), Hubert F. 
Hofmann, Deborah K. Yedlin, John W. Mishler, and Susan Kushner, CMMI 
for Outsourcing: Guidelines for Software, Systems, and IT Acquisition, 
SEI Series in Software Engineering (Boston, MA: Addison-Wesley 
Professional, 2007), and GAO-04-722. 

[31] Acceptable levels refer to the fact that any systems acquisition 
effort will have risks and will suffer the adverse consequences 
associated with defects resulting from system acquisition and 
implementation processes. However, effective implementation of 
disciplined processes reduces the possibility of the potential risks 
actually occurring and prevents significant defects from materially 
affecting the cost, timeliness, and performance of the program. 

[32] Department of Defense, Risk Management Guide for DOD Acquisition, 
sixth edition Version 1.0, (August 2006). 

[33] GAO, Financial Management Systems: Additional Efforts Needed to 
Address Key Causes of Modernization Failures, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-06-184] (Washington, D.C.: Mar. 
15, 2006). 

[34] GAO, Army Depot Maintenance: Ineffective Oversight of Depot 
Maintenance Operations and System Implementation Efforts, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-05-441] (Washington, D.C.: June 
30, 2005). 

[35] [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-07-860]. 

[36] GAO, Financial Management Systems: Lack of Disciplined Processes 
Puts Implementation of HHS' Financial System at Risk, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-04-1008] (Washington, D.C.: Sept. 
23, 2004) and [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO/AIMD-00-
134]. 

[37] GAO, Office of Personnel Management: Retirement Systems 
Modernization Program Faces Numerous Challenges, [hyperlink, 
http://www.gao.gov/cgi-bin/getrpt?GAO-05-237] (Washington, D.C.: Feb. 
28, 2005); Information Technology Management: Customs Automated 
Commercial Environment Program Progressing, but Need for Management 
Improvements Continues, [hyperlink, http://www.gao.gov/cgi-
bin/getrpt?GAO-05-267] (Washington, D.C.: Mar. 14, 2005); and Executive 
Guide: Creating Value Through World-class Financial Management, 
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO/AIMD-00-134] 
(Washington, D.C.: April 2000). 

[38] The second deployment was to include Headquarters, Air Mobility 
Command, the 375th Airlift Wing, and two Air National Guard wings. This 
deployment would have increased the total number of users to 
approximately 800. 

[39] A computer desktop configuration conflict caused Air Force 
desktops using Internet Explorer 7.0 to fail when connecting with the 
core applications within DEAMS. This problem did not affect Air Force 
desktops using Internet Explorer 6.0. The Air Force identified the 
problem in November 2007 after it deployed DEAMS to approximately 200 
users and as user desktops were simultaneously being upgraded from 
Internet Explorer 6.0 to Internet Explorer 7.0 as part of the normal 
technology refresh process (i.e., the Internet Explorer 7.0 upgrade was 
not driven by DEAMS). In December 2007, it was decided to (1) keep the 
200 existing DEAMS users on Internet Explorer 6.0 and (2) stop 
deployment for the remaining 400 new users until a viable Internet 
Explorer 7.0 connectivity solution was in place. 

[40] The Air Force Financial Management Strategic Plan identifies seven 
goals: (1) foster mutual respect and integrity, (2) reduced Air Force 
cost structure, (3) expand partnership in strategic Air Force 
decisions, (4) recruit, prepare, and retain a well-trained and highly 
educated professional team for today and tomorrow, (5) provide our 
customers with world-class financial services, (6) implement open, 
transparent business practices and achieve a clean audit opinion, and 
(7) continuously streamline financial management processes and increase 
capabilities. 

[41] GAO, Agencies' Annual Performance Plans Under the Results Act: An 
Assessment Guide to Facilitate Congressional Decisionmaking, 
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO/GGD/AIMD-10.1.18S] 
(Washington, D.C.: February 1998). 

[42] Best practices and relevant DOD guidance were derived from the 
following publications: Steve McConnell, Rapid Development: Taming Wild 
Software Schedules (Redmond, WA: Microsoft Press, 1996), Hubert F. 
Hofmann, Deborah K. Yedlin, John W. Mishler, and Susan Kushner, CMMI 
for Outsourcing: Guidelines for Software, Systems, and IT Acquisition, 
SEI Series in Software Engineering (Boston, MA: Addison-Wesley 
Professional, 2007), GAO, Information Technology: DOD's Acquisition 
Policies and Guidance Need to Incorporate Additional Best Practices and 
Controls, [hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-04-722] 
(Washington, D.C.: July 30, 2004), and Department of Defense, Risk 
Management Guide for DOD Acquisition, sixth edition, Version 1.0, 
(August 2006). 

[43] GAO, DOD Business Systems Modernization: Military Departments Need 
to Strengthen Management of Enterprise Architecture Programs, 
[hyperlink, http://www.gao.gov/cgi-bin/getrpt?GAO-08-519] (Washington, 
D.C.: May 12, 2008). 

[44] U.S. Air Force Materiel Command Pamphlet 63-101, Acquisition: Risk 
Management (July 9, 1997). 

[End of section] 

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