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The Army's ERP future

Army ERP modernization drives management ahead

May. 21, 2014 - 06:00AM   |  
By AMBER CORRIN and NICOLE BLAKE JOHNSON   |   Comments
The Army's enterprise resource planning programs carry out the Army's back-office functions, and they all are central to servicewide and DoD-wide operations.
The Army's enterprise resource planning programs carry out the Army's back-office functions, and they all are central to servicewide and DoD-wide operations. (Army)

The Army’s highest-profile enterprise resource planning (ERP) programs each have distinctive purposes critical to the service’s financial management. Over the years each ERP has seen an evolution in goals, strategy and execution as the Army looks to modernize its programs and centralize operations.

The programs’ modernization takes on particular importance as the Defense Department works to achieve directives in financial management reform and audit-readiness. The Army’s ERPs each play an important role in helping DoD meet those requirements, and moves the service away from legacy systems.

The Army’s General Fund Enterprise Business System (GFEBS), Army Contract Writing System (ACWS), Global Combat Support System-Army (GCSS-Army) and Logistics Modernization Program (LMP) may carry out the Army’s back-office functions, but they all are central to servicewide and DoD-wide operations. They also are undergoing a new phase of evolution as the Army streamlines their management, including bringing ERP programs together under a centralized Army Enterprise Systems Integration Program (AESIP).

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While AESIP serves as the enterprise hub for the Army’s logistics and financial ERP business systems, another centralization effort, the Army Shared Services Center-Organic System Integrator, moves the responsibility for architecture, engineering, development and sustainment of the enterprise system under government management. The goal is to insource more ERP subject matter experts within the government to provide the Army with more flexibility, reduced costs and greater stability for future operations, officials said.

By providing clearer insight into Army business functions, logistics and operations, ERPs and their modernization are carrying the service into a new era of management as a whole. To get to that new era, the Army must move beyond the separate and costly legacy systems of the last generation.

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“Financial audit-readiness is enabled by visibility of actual execution — visibility of the actions performed in the systems that create debits and credits, users performing those actions and the manner in which they are performed,” said Col. Harry Culclasure, AESIP project manager at Army Program Executive Office-Enterprise Information Systems.

Beyond improving visibility across the enterprise of the logistics and financial environments, the modernization efforts will enable better near-real-time decision-making and agile, efficient combat operations. The changes also will allow the Army to retire custom-designed, standalone legacy business systems and replace them with a central, integrated business software baseline optimized to best business practices. Additionally, modernization helps the Army take advantage of current technology that meets financial compliance regulations, and eliminates the need for extensive maintenance and modification of aging, separate systems.

One way those separate efforts come together is under AESIP. From a program prospective, AESIP provides program management leadership direction for GCSS-Army, LMP and the AESIP Hub, which is the master data repository and information hub and that provides cross-functional, cross-domain business intelligence.

GCSS-Army and GFEBS consume the enterprise master data as part of their respective business processes. Each uses the information hub for interfacing outside the Army enterprise, and GCSS-Army uses the business intelligence suite as the principle decision support system.

Not only does the modernization plan improve business operations and decision-making, it also will improve how the Army handles procurement — and how the service conforms to broader DoD acquisition reform, including Better Buying Power.

“The Army ERP services acquisition plans to implement various Better Buying Power initiatives, including strategic sourcing, reducing indirect costs, increasing use of small businesses, maximizing competition, shortening award cycle times, and centralizing contract planning and administration,” Culclasure said. “Increasing small business contracting opportunities — specifically prime awards — is a priority of this acquisition and will play a role in reducing cost.”

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The use of small business is a priority as the modernization effort also guides the Army to new approaches in contracting. Extensive review of the ERP programs, including in conjunction with the Office of Management and Budget, resulted in Army leaders recommending a hybrid approach. That new approach would include a new small business contract anticipated for award in the third quarter of fiscal 2015, as well as the use of the National Institutes of Health Information Technology Acquisition and Assessment Center’s CIO Solutions and Partners 3 governmentwide acquisition contract.

Army ERPs and DoD audit-readiness

It is impossible to separate Army ERP modernization from the Pentagon’s high-profile efforts to achieve audit-readiness and financial management reform across the department. Audit readiness and logistics operations are inextricably linked, and PEO EIS officials say that the relationship is being implemented enterprisewide for the very first time in the Army.

“The systems are built on cross-domain integration, based on authoritative data, and leverage the inherent capabilities of the software that otherwise would not be possible,” Culclasure said. “The Army is achieving this integration through the linkage of business processes between the logistics ERPs – GCSS-Army and LMP – and GFEBS, the Army financial management system.”

In particular, due to the scale required to support the sheer numbers of Army users, the GFEBS and GCSS-Army systems utilize a federated design. The federated approach incorporates GFEBS general ledger rules and processes into GCSS-Army, and properly updates the financial ledger in GFEBS. This reduces related real-time transaction volume between the two systems and helps ensure audit readiness, officials said.

Across DoD, military leaders at the highest levels repeatedly have emphasized the need for department finances to be auditable.

In a recent congressional testimony, as part of hearings examining Army posture, Army Secretary John McHugh addressed the state of the ERPs, praising the Army’s efforts and specifically pointing out the great strides that GFEBS and GCSS-Army have made.

“It’s stated in law that we have to be auditable by 2017. We believe we are fully on track to meet that. The ERPs have been going very well,” McHugh said. With regard to GFEBS in particular, “we’ve had a series of roll outs ... which we’re taking in segmented fashion so that we can make sure we’re managing [GFEBS] in the right way. And we’re having very, very good success.”

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