Army Cost Culture Army Cost Culture Initiative May 2013 DASA(CE) Ad-hoc Army today Cost Managed Organization Brief to the Honorable Dr. Westphal Changing Processes Resource Informed Decisions (CBA) Changing Technology Enterprise Resource Planning (GFEBS, LMP, GCSS- A, IPPS-A) Changing People Training Cost Management Changes the Army Culture 1
14
Embed
Army Cost Culture A rmy Cost Culture Initiative May 2013 DASA(CE) Ad-hoc Army today Cost Managed Organization Brief to the Honorable Dr. Westphal Changing.
This document is posted to help you gain knowledge. Please leave a comment to let me know what you think about it! Share it to your friends and learn new things together.
Cumulative CBAs Submitted into CBA Workflow ToolDecision Forum Totals
AROC 193Army Campaign Plan (ACP) 10Budget Review Program 12Concept Plan 224Congress 2EE PEG 10FDU 31II-PEG 28Insourcing 41Legislative Proposal 59MM-PEG 5OO-PEG 3Office of the Secretary of Defense (OSD) 3PBAT 4Planning Programming Budget C (PPBC) 5SLI 29SS PEG 12TT-PEG 18UU PEG 3Unknown 13Other 47report total: 752
* Not included are CBAs that have been withdrawn and those that did not include a decision forum
4
May 2013
Arm
y Co
st C
ultu
re
GFEBS will provide Multiple Cost Views for
Decision Making at Every Level
… provide essential data to transform the Army
to a cost culture
Army Cost Management Framework
GFEBS TechnologyEnables Cost Management
5
May 2013 DASA(CE)
Arm
y Co
st C
ultu
re
GFEBS Provides Total Cost Visibility
10 views (table) cost visibility for five dimension Polygon
2.Co
ntra
cts
3.Se
rvic
es
1
3
2 5
6
Total Cost Visibility Example:
1- Customers by Contracts2- Customers by Services 3- Customers by Funding4- Customers by Cost Centers5- Contracts by Service6- Contracts by Funding7- Contracts by Cost Centers8- Services by Funding9- Service by Cost Centers10 –Funding by Cost Centers
1. Customers
4.Fu
ndin
g5.
Cost
Ce
nter
s
2. Contracts
3. Services
4. FundingPE
7
8
9 104
N * (N-1) / 2for each FY
6
May 2013 DASA(CE)
Arm
y Co
st C
ultu
re
Army Cost Management Training
ICAM• Cost Flow Methods• Analysis and Reporting• Practical Exercises• Complex Case Studies• Cost-Benefit Analysis
PCAM• Cost Terms• Cost Concepts• Fundamentals of Cost
Accounting and Cost Management
• Practical Exercises• Cost-Benefit Analysis
Principles of Cost Analysis and Management
Intermediate Cost Analysis and Management
CMEX• Cost• Leadership-Driven Cost
Management• Cost-Benefit Analysis• Value Proposition
CMCC• Managerial Cost Accounting• Operations Management• Cost Control and Cost-Benefit
Analysis• Organizational Development for
Cost Managers
Army Cost Management Certificate Course
Cost Management Executive Course
3 Weeks3 Weeks 4 Weeks
4-Hour CBA Training• What is CBA?• Why do we need CBA?• Who are the key
players?• What Army processes
call for CBA• What are the
processes and methodologies used
4-Day CBA Training• Policies,
Regulations, Methodology, and Roles
• Workflow Automation Tools
• Other Tools• Case Studies and
Exercises
GFEBS: Other Training Other Training• Online• Defense
Acquisition University (DAU)
• Force Management (FA50)
GFEBS General• GFEBS Overview• Integrated Process
Overview• Navigation and
Reports• Business Intelligence
Reporting • Fundamentals
GFEBS Other Training• Cost Management• Equipment and Assets• Financials • Funds Management• Plant Maintenance• Project Systems • Real Property• Reimbursable• Spending Chain
GFEBS Online Training Cost Benefit Analysis (CBA) Training
Cost Management Education
TBD
Slide 7
May 2013 DASA(CE)
Arm
y Co
st C
ultu
re
CM Community of Practice
AKO Cost Management Community
Cost Warrior Newsletter
Cost Warrior milSuite web site
Cost Warrior RoundtableCost Warrior Listserv
CBA Field Trainers
8 1
May 2013
Arm
y Co
st C
ultu
re
Senior Leadership Commitment
SECDEF Leon Panetta, 5 Jan 12: New DoD Strategic Guidance—Impact of fiscal constraints We are shaping a Joint Force for the future that will be smaller and leaner, but will be agile, flexible, ready, and technologically advanced.
SECDEF Robert Gates 24 May 11: …not repeat the mistakes of the past …salami-slicing” approach results in a hollowing-out of the force
DEPSEC William Lynn, 11 May 11: America’s cut forces after every war: WW II, Korea, Vietnam, Iraq…the Army had to reverse course, rebuild…we’re 0-for-4 in managing drawdowns
SECARMY McHugh at AUSA Oct. 10, 2011: Army Bracing for More Budget Cuts No matter what happens, we are not going to have a hollow force We have been analyzing the best ways to meet these challenges, …and do it in a way that truly makes sense.
USD (AT&L) Dr. Ashton Carter, June 28, 2010: Better Buying Power: Mandate … …we can't support our troops with the capability they need unless we achieve greater efficiency (doing “more without more”)
Army
• USA/VCSA memo (30 Dec 2009) Directed CBA's are to be prepared (For APGM and TGM, Force Design Updates, Concept Plans, Part of VCSA portfolio analyses, ACP, BRP, AR2B, etc..)
• SECARMY McHugh at AUSA, 10 October 2011
• USA Efficiency Memo, 2 September 2010
• ASA-FM&C Cost Management Memo, 7 January 2011
• Army Campaign Plan Object 9.4 and 9.8
OSD
• SECDEF Memo, 16 August 2010
• SECDEF Robert Gates 24 May 11
• SECDEF Leon Panetta, 5 Jan 12
• USD (AT&L) Dr. Ashton Carter, June 28, 2010 Better Buying Power
OBJECTIVE: Increase the number of Generating Force (Infrastructure) organizations executing quarterly cost management reviews, increase the use of cost benefit analysis and improve the Cost Management Maturity Model index score.
Slide 10 10
May 2013 DASA(CE)
Arm
y Co
st C
ultu
re
Army Campaign Plan Objective 9
Measure Baseline & Target Initiatives Frequency
Output: The number of generating force organizations (operating on GFEBS) that are executing quarterly Cost Management process reviews.
- Organizations will be defined by Fund Centers within a Command (ACOM, DRU, and select ASCC).
- The baseline for number of organizations executing quarterly reviews will be assessed by Command at the beginning of year (assume start point is zero)
- Target Set to Achieve 90% of Army Organizations executing Quarterly Reviews by 2013.
- Cost Management Training (Cost Management Certification Course, Cost Mgmt 101, GFEBS Modeling and Deployment)
- Issue Survey by Command to Establish Baseline.- Develop requirement linked to GFEBS
deployment for conducting Quarterly Cost Management Reviews
- Define CP-11 Manpower Requirements to Adapt Workforce for more Analytical Skills
Measured Quarterly:
Calculated as “ Number of organizations executing quarterly CM reviews / Total number of organizations within command"
Output: The number of organizations utilizing Cost Benefit Analysis (CBAs) in making resource-Informed decisions
- Organizations will be defined by Fund Centers (for those on GFEBS) or Allotment Serial Number (for those on Legacy Financial Systems) within a Command (ACOM, DRU, and select ASCC).
- The baseline for number of organizations utilizing CBAs will be assessed by Command at the beginning of year (assume start point is zero)
- Target Set to Achieve 90% of Army Organizations making resource-informed decisions using CBAs by 2012
- USA/VCSA memo (30 Dec 2009) Directed CBA's are to be prepared (For APGM and TGM, Force Design Updates, Concept Plans, Part of VCSA portfolio analyses, ACP, BRP, AR2B, etc..)
- Prepare additional ASA(FM&C) guidance requiring use of CBA practices to support Resource-Informed Decision-Making throughout Army
- Continue CBA Training, CMCC and Cost Management Training Across Army
Measured Quarterly:
Calculated as "Number of organizations utilizing CBA's / Total number of organizations within command"
Output: The percent improvement in Cost Management Maturity Model (CM3) score index.
- Establish Baseline Index Score by organization- Initial Target Set as % Increase from Baseline
by Command (Measure Twice per Yr) than % Increase from Previous Period
- Direct Initial Army-wide Assessment using Cost Management Maturity Model Survey to Establish Baseline
- Reassess at Mid-Year and Year-End (Annually)
Measured Bi-Annually:
Calculated as “Percent change In index score from previous period by organization"
1 AAR After Action Report2 ABC Army Business Council3 ACDB Automated Cost Database 4 ACEIT Automated Cost Estimating Integrated Tools5 ACP Army Cost Position6 ACP-O9 Army Campaign Plan Objective 9.4 and 9.87 ACT ARFORGEN Costing Tool8 AFBRT Army Financial Benefits Reporting and Tracking9 AFMO Army Financial Management Optimization
10 AMCOS Army Military-Civilian Cost System 11 AoA Analysis of Alternative12 AR2B Army Requirements and Resourcing Board13 ARFORGEN Army Force Generation14 AROC Army Requirements Oversight Council15 ARRG Army Working Capital Fund) Requirements Review Group16 ASARC Army Systems Acquisition Review Council17 BCA Business Case Analysis18 CAM Army Cost Analysis Manual19 CARB Coalition Acquisition Review Board 20 CBA Cost Benefit Analysis21 CBA 4D CBA training 4 Days22 CBA 4H CBA training 4 Hours23 CBA-G CBA Guide24 CBA-RB Cost Benefit Analysis Review Board25 CBA-WM CBA Workflow Management26 CC Cost Culture27 CCDR Contractor Cost Data Reporting28 CE Cost and Economics 29 CE-CMC DASA-CE Cost Management Certification30 CKB Capability Knowledge Base31 CM Cost Management32 CMC Financial Management Certification 33 CMCC Army Cost Management Certificate Course 34 CMEX Cost Management Executive Course35 CP-TDA Concept Plan (TDA Updates)36 CRB Cost Review Board37 CSDR Cost and Software Data Reporting38 CW Cost Warier 39 CW-NL Cost Warier Newsletter
40 CW-RT Cost Warier Roundtable41 DASA-CE Deputy Assistant Secretary of the Army for Cost and Economics 42 EA Economic Analysis43 EA-M EA Manual44 EC Early Costing Pre-Milestone-A45 EE Equipping PEG46 EVM Earned Value Management47 FORCES Force and Organizational Cost Estimating System48 FP Fellowship Program49 G-CC GFEBS Cost Center50 G-CE GFEBS Cost Element51 G-CMM GFEBS Cost Management Module52 G-CO GFEBS Cost Objects53 GFEBS General Fund Enterprise Business System54 G-WBS GFEBS Work Breakdown Structure55 IATC Institutional Army Transformation Commission56 ICAM Intermediate Cost Analysis and Management57 ICE Independent Cost Estimate58 IGCE Independent Government Cost Estimate59 II Installation PEG 60 ISR Installation Status Report 61 ITA Army Information Technology Agency 62 JCIDS Joint Capabilities Integration and Development System63 JIAT Joint Integrated Analysis Tools64 LCCE Life Cycle Cost Estimates 65 LSS Lean Six Sigma 66 MDUR More Disciplined Use of Resources - campaign67 MM Manning PEG68 OO Organizing PEG69 OSD-CMI OSD Cost Management Initiative70 OSMIS Operating and Support Management Information System 71 PCAM Principles of Cost Analysis and Management 72 PEG Program Evaluation Groups73 PPBES Planning, Programming, and Budgeting, and Execution System74 R2C2 Requirement Readiness Capacity Cost Analysis75 RA Redundancy Analysis76 RM-J Resource Management Journal78 SBC Service Based Costing79 SS Sustaining PEG 81 TCVF Total Cost Visibility Framework, GFEBS CM design (ITA, USASOC, .. )82 USASOC United States Army Special Operations Command