Systems Engineering Forum Oct 15, 2004 Ver 1.16 DEFENSE LOGISTICS AGENCY Transformation -- Supporting The Warfighter.

Systems Engineering Forum Oct 15, 2004 Ver 1.16 DEFENSE LOGISTICS AGENCY Transformation -- Supporting The Warfighter

2 Scope of Business 45,000 Requisitions/Day 8,200 Contracts/Day #54 Fortune 500 Above Northrop Grumman #2 in Top 50 Distribution Warehouses 25 Distribution Depots 5.2 Million Items 24.7M Annual Receipts and Issues 1411 Weapon Systems Supported 147.7M Barrels Fuel Sold (FY 03) $12.5B Annual Reutilizations/Disposals 21,490 Civilians 524 Active Duty Military 637 Reserve Military Located in 48 States/28 Countries Foreign Military Sales Sales: $719M Shipments: 580K Supporting 124 Nations FY 02 Sales/Services: $21.5B FY 03 Sales/Services: $25B FY 04 Projection: $28.9B Land/Maritime/Missiles: $ 2.7B Aviation: $ 3.3B Troop Support: $10.2B Energy:$ 5.2B Distribution: $ 2.2B Other: $ 1.4B ~95% of services repair parts 100% of services subsistence, fuels, medical, clothing & textile, construction & barrier materiel The DLA Enterprise as of Oct 1, 04 People

3 J-3 L OGISTICS O PERATIONS J-1 H UMAN R ESOURCES DNSC DIRECTOR VICE DIRECTOR DLA S UPPORT S ERVICES DSCR J-8 F INANCIAL O PERATIONS SPECIAL STAFF J-9 J OINT R ESERVE F ORCES DLA Director Vice Admiral Keith W. Lippert Supply Corps, United States Navy DLA-EDLA-P Vice Director Major General Mary Saunders United States Air Force J-4 C USTOMER O PERATIONS & R EADINESS CORPORATE STAFF DDCDSCPDESC J-6 I NFORMATION O PERATIONS DSCCDRMS DLISDAPS BUSINESS UNITS SERVICE ACTIVITIES DLA-C Defense Logistics Agency

4 10 Major IT modernization programs 2 ACAT 1A $1.8+ billion net savings committed for return to the Services Agencys core business model changing Support to Services driven by future requirements Suppliers manager and integrator Supply Chains effective, efficient and seamless Partner End-to-end internal business process re-engineering based on COTS integration Collaborating with Services, Agencies and Combatant Commanders DLAs Transformation Strategy

5 Legacy systems do not meet current and future operational needs Does not support Joint Vision 2020, DoD Force-Centric Logistics and DLA Strategic Plan Does not support changing business rules Obsolete code and outdated/inflexible technology No real-time access to logistics data High maintenance costs, increasing unreliability Legacy environment does not support DLAs Vision for Warfighter Customer Support Why DLA Needs To Modernize Its Business Systems

6 Major Transformation Effort--Massive Change for our Workforce, Creation of an Enterprise Incorporating Best Practices via Commercial-Off-The-Shelf (COTS) Based Tools BSM Replaces 30-year old Materiel Management Systems and our processes were embedded in those systems The Core of DLAs Enterprise Architecture Using best business systems engineering practices Managed as ACAT 1A program DLAs Business Systems Modernization (BSM)

7 Economic Analysis Summary: Investment $ 506.7 M Return$ 772.1 M Return on Investment 1.52 Payback FY 09 July 03 Economic Analysis. EA is being updated for Full- Rate Production Deployment Review Expected Benefits: Improved demand forecasting accuracy Better stock positioning Improved financial accountability Achieve auditable financial statements Retire 15 legacy systems Reduce risk of catastrophic failure Program Attributes: Major Acquisition Program Within Program Objective and Threshold Core of DLA Transformation strategy Reengineered business process and best practices Enterprise Resource Planning (ERP)/COTS Commercial Data Center Program Timeline: Analysis of AlternativesJan 99 Scripted Demonstration of COTSAug 99 Mission Need validated/approved by JROC/Milestone 0 Nov 99 Approval to begin Concept Development by ASD(NII)/Milestone 1/2 Aug 00 Blueprint/Design/Build/Test Jan01-Jun02 Approval to being Concept Demonstration by ASD(NII)/Milestone CJul 02 Initial Operating CapabilityFY 05 Full Operating CapabilityFY 06 BSM Program Summary

8 Business Systems Engineering Approach Design Deliverables Functional Designs Scenarios & Scripts Data Migration/Conversion Approach Training Execution Plan Training Gap Analysis Competency Profiles BSM Roles & Responsibilities Build Deliverables Technical Specifications Source Code Training Material Unit Test Plan & Results System/Product Test Plan Conversion/Mock Conversion Test Plan Performance/Stress Test Plan Regression Test Plan Configuration Rationale Assembly Test Plans Test Deliverables Functionality Test Cases/Test Scripts/Data Sheets Integrated Test Cases/Test Scripts/Data Sheets System/Product Test Execution Plan/Log Security Test (Application) Plan & Results User Acceptance Test Plan & Results System Product Test Results Conversion/Mock Conversion Test Results Performance/Stress Test Results Regression Test Results SIR Report with Completion Status Build TRR Requirements ITR Design PDR CDR Test ORR OA Independent IOT&E Independent Validation and Verification (IV&V) Documented in SEP/TEMP Responsibility of the Program SE Lead Process Validation by the SE Chief In Coordination with the SE Technical Authority OTRR SRRIBR Technical Blue Print Review RICE Object Validation Business Systems Modernization (BSM)

9 ChiefInformationOfficer Portfolio Management Portfolio Management Program Management Enterprise Architecture Program Executive Officer Chief Architect Enterprise Portfolio Manager Business Systems Engineering Enterprise Solutions J-6 Organizational Relationships

10 DLA Portfolio Management Process

11 Strategic Planning (Cyclical-Annual) Mission Analysis (Event Driven) Portfolio Management (POM Driven) Systems Acquisition (Phased Milestone-Driven) TEB Process Owners Portfolio Manager Architecture Information Repository Portfolio Information Repository Process Information Repository Enterprise Models Operational Models Functional Proponent s System and Infrastructure Models PEO and MDAs Functional Proponent s PMs TEB Architecture compliance Architecture Baselines J-1 / J-3 / J4/ J-6 / J-8/ J9/ DSS Functional Rqmts Gaps/Overlaps Investment Phasing Transition Plan ( Master Schedule) Enterprise Architecture Process for change

EXECUTE LOGISTICS ELIMINATE/DEMOTE ENABLE LOGISTICS PLAN LOGISTICS Plan Materiel Provisioning Logistics Chain OV2.1 Analyze Data From CBM+ Monitor Intransit Visibility Monitor Asset Location Monitor Maintenance History Monitor Cost Integrate Asset Collect Historical Maintenance Data Validate and Verify Modification Kit Install Modification Kit SourceMakeDeliverSustain Contract Award Contract Administration Program Structuring, Planning & Scheduling Project Execution Program Structuring, Planning & Scheduling Plan Acquistion Strategy Conduct Test & Evaluation PackagingDelivery Plan Fielding and Allocation Scrap (TLCSM)Sales (TLCSM)Gains & Losses (TLCSM)Surplus (TLCSM) Asset Visibility Plan Materiel Provisioning PublicationsBills of Materials Plan TLCSM This is outside of Logistics and is in the role of Acquisition BEA-Log DoD Enterprise View DoD Domain Views DLA Supply Chain View BEA BEA Activity Overview Perform Organizational Management Manage Benefits Manage Payroll and Travel Pay Identify Financial Compliance Report Requirements Identify Management Report Requirements Prepare Information Product Disseminate Information Product Analyze Customer/ Vendor Information/ Credit Perform Billing/ Establish Receivables Manage Receivable/ Debt Manage Cash Liquidate Receivable/ Debt Establish Strategic Requirements Establish Future Year Defense Plan/ Program and Budget Allocate and Control Funding Execute Current Year Business Plan Improve Strategic Planning and Budgeting Processes Perform Procurement and Acquisition Manage Payables Manage Purchase Card Program Disburse Funds Design/Maintain Code Structure/Chart of Accounts/ Accounting Methodology Map/Post/ Accumulate Information Conduct Closing and Review Perform Accounting Analysis and Review Human Resource Management Execute Logistics Plan Logistics Enable Logistics Financial Management & Reporting Process Collection/ Acct Rec & Manage Cash Perform General / Cost Accounting Perform Strategic Planning & Budgeting Manage Procurement / Payable / Acq / Disbursing Perform Logistics Manage Operations PlanningOrder Fulfillment Procurement Finance BSM Alignment with DOD Architectures

13 Sponsorship/Leadership Reporting Process DLA Oversight Overarching IPT (OIPT) Change Management Change Management Knowledge Transfer Knowledge Transfer Risk & Issue Management Risk & Issue Management Site Transition Site Transition Contracts & Acquisition Contracts & Acquisition Solution Integration Solution Integration Solution Sustainment Solution Sustainment Program IPTs Integrating IPT (IIPT) Working IPTs (WIPTs) Acquisition Technical Testing Earned Value/Resource Monitoring Earned Value/Resource Monitoring TEB Corp. Board CIOPartners PEO Program Oversight Weekly Solution Integration Status Weekly Change Control Board Monthly Program Manager Assessment Quarterly Program Implementation Group Quarterly Defense Acquisition Executive Summary Report PM Program Milestones Exit Criteria Reviews For Each Phase System Readiness Preliminary Design Critical Design Test Readiness Operational Readiness Program Integration Monthly Corporate Board Bi-Monthly TEB Enterprise Architecture Reviews Program Reporting OMB Circular A-11 (Budget cycle) Clinger Cohen Act Certification Federal Information Security Management Act (FISMA) Domain Reporting Business Enterprise Architecture FFMIA Comptroller Certification Logistics Program Review IPT Reporting Weekly WIPT Meetings Bi-Weekly WIPT Leadership Reviews Information Assurance Information Assurance CAE MDA Director PMO SI CIO

DLA Policy and Guidance PMs Monthly Assessment -Sample- Delivering Transformation through Disciplined Business Systems Program Management Practices

SEP TEMP Overarching IPT (OIPT) Integrating IPT (IIPT) PEO Review Board Program Alignment, Engineering Authority ACAT III ProgramsACAT IA Programs DLA Chief Information Officer J-6 Chief Technology Officer PEO Design ---------- Build ---------- Test System Solution Integrator MDA PEO Review Board Program Alignment, Integration and Engineering Oversight MDA Technical Reviews Program Oversight Technical Reviews IT Solutions Document Enterprise Architecture LCM for Emerging Systems -One Book AIS Program Management -One Book IT Acquisitions-One Book CMMI Data Quality CMMI Reviews CAE Acquisition Oversight DLIS - Data Integrity System Integrator Best Practices DLA Business Systems Engineering Governance

16 SEP Policy/ Procedures Technical Authority Best Practices Lessons Learned Education/ Training Tools Contract Incentives SE Partnerships SEP Policy/ Procedures Technical Authority Best Practices Lessons Learned Education/ Training Tools Contract Incentives SE Partnerships Business Systems Engineering Characteristics Enclosure 10 Capability Analysis Functional Requirements Analysis and Allocation Design Requirements Loop Verification Design Loop Business Systems Capabilities Needed Capabilities Acquisition Planning Requirements Mgmt Configuration Mgmt Risk Mgmt Project Mgmt Test and Evaluation Integrated Teams Solicitation and Source Selection SE Partnerships Acquisition Planning Requirements Mgmt Configuration Mgmt Risk Mgmt Project Mgmt Test and Evaluation Integrated Teams Solicitation and Source Selection SE Partnerships Business Systems Engineering Process Software Acquisition (SA) Process Improvements Section 804 Build Test Test Loop Software Acquisition/Business Systems Engineering Process Improvement Approach

Testing Process Management Project Management Plan Configuration Control Board (CCB) Contemporary Systems Director, Enterprise Solutions Design ---------- Build ---------- Test DLA Sustainment Organization (J-6) System Oversight IT Solutions Document IT Acquisition One Book Enterprise Architecture LCM for Contemporary Systems One Book IEEE/EIA 12207.1 SPI CMMI CM/TM Tools DLA Chief Information Officer J-6 Chief Technology Officer Technical Reviews Data Quality DLIS - Data Integrity DLA Business Systems Engineering Governance

18 How do we close the Gap DLAs Business Systems Engineering Workforce Ensure transition plan in place Reduce legacy demand Ensure quality hand-off from BSM program office Set realistic expectations with the business Use contractor support for legacy and move organic to BSM Ensure people are Job Ready Requires Supervisor focus and accountability to affect workforce change Measure and hold employees accountable Drive skill development with continued focus on training and job assignments Establish meaningful IDPs * Based on extrapolation of Employee estimates of skill progress Steady State Projected Demand = 177 employees Steady State Target Budget Staffing = 119 Employees Steady State Projected Demand = 177 employees Steady State Target Budget Staffing = 119 Employees 10/200312/2003 R1.1 03/2004 R1.2 5/2004 R1.3 8/2004 R2.0 9/2006 FOC As of: July 2004 DLAs Sustainment Workforce

19 DLA Response Wynne Direction: All Programs Apply robust Systems Engineering (SE) approach to balance total system performance and total ownership costs within FOS/ SOS context Develop a SEP for MDA approval for each Milestone Review and integrated with the Acquisition Strategy Describe programs overall technical approach in SEP Technical Approach Technical Reviews DLAs IT business systems programs are implemented using COTS solution integration best practices consistent with systems engineering best practices In DLA, business SE is applied to both Emerging and Contemporary IT Business Systems DLA is updating and developing One Book Topics to address business SE and SEP requirements DLA is revising the MS Exit Criteria to include business SE for ACAT III Programs Oversight is accomplished through the Alignment, Integration, and Engineering Organization Moving to a COTS Business Systems Engineering Focus as an Enterprise Wynne Systems Engineering Plan Direction and DLA Response

20 Streamline, Leverage and Collaborate Awareness, Change Readiness, Training and Education Enhance Portfolio Management Active Engagement/Effect Process Change Streamline, Leverage and Collaborate Awareness, Change Readiness, Training and Education Enhance Portfolio Management Active Engagement/Effect Process Change FOCUS Tailored COTS business systems engineering approach across Logistics Domain DUSD(L&MR) Program Implementation Group Defense Acquisition System (5000) Streamlining with AT&L Logistics Cross-Domain Integration Data Integration Data Interoperability Logistics COE Data Strategy consistent with Net-Centric Enterprise Services Business Enterprise Architecture Defense Acquisition University (CEBS) EI Toolkit DLA Collaboration Efforts

21 COTS Lifecycle Overview

22 Coordination of multiple organizations for ACAT IA programs (SE/Test, BEA, IA, etc.) Evolving Net-Centric context Agency resources stretched where some PMOs consist of only 2-3 personnel. Must rely on industry for business SE processes Program impact when applied to post-Milestone B ACAT IA programs Tailoring for COTS integration business systems implementation Business Systems Engineering Concerns

23 Delivering Transformation through disciplined business systems engineering, portfolio management, and program management practices Implement business SE within each program, using BSM practices as the Model Provide oversight through PEO Program Alignment, Integration, and Engineering Office Business SE a part of Milestone Reviews and CMMI reviews Leverage Industry COTS business systems engineering practices Updating Policies in the DLA One Book Conclusion DLA Implementation Approach

24 Backup Slides

SE Technical Authority Enclosure 10, DODI 5000.2 Requirement J-64 Enterprise Solutions PROGRAM SE Lead Technical Review Board SEP TEMP PROGRAM SE Lead Technical Review Board SEP TEMP PROGRAM SE Lead Technical Review Board SEP TEMP SE Chief Alignment, Integration, and Engineering J-621 Business Systems Engineering Compliance Structure DRAFT PEO Office PEO J-62

26 Requirements ITR Initial Technical Review SRR System Requirements Review Design Test ORR Operational Readiness Review OTRR Operational Test Readiness Review Production & Deployment IBR Integrated Baseline Review PCA Physical Configuration Audit IBR Integrated Baseline Review TRR Test Readiness Review Build Operations & Support In-Service Review MS C IOC FOC Technical Review Boards PDR Preliminary Design Review CDR Critical Design Review System Development & Demonstration Concept Refinement Technical Development MS B MS A Technical Reviews Approach

Acts as the MDA for ACAT III programs Chairs the PEO Review Board Provides Program Assessment and Status Reporting Implements LCM Policy and Procedures Provides Comments to the DAES Reports Oversees PM Training and Certification Provides oversight to Program Funding Provides oversight for systems integration Provides guidance and direction to the PMs Informs CIO/CAE of program critical issues Implements the IT systems acquisition policy and procedures Reports directly to the CIO Reviews and/or approves appropriate LCM program products CAE PEO CIO Director DLA TEB PEO Responsibilities Jointly sets IT systems acquisition policy and procedures through the One Book Process Provides IT investment and programmatic oversight and support to the PEO Reviews and concurs with IT ACAT IA Acquisition Program Baselines Provides IT capabilities through IT program implementation and performance through the PEO Reviews IT program EA/BCAs for quality and ROI Certifies CCA Compliance Selects and Assigns PMs for IT ACAT IA and ACAT III Programs Oversees IT PM training and certification Participates as a member of the TEB Jointly identifies IT special interest programs CIO Responsibilities Jointly sets IT systems acquisition policy and procedures through the One Book Process Provides acquisition program oversight and support to the PEO Reviews and concurs with ACAT IA Acquisition Program Baselines Delegates MDA to PEO for ACAT III Programs Delegates MDA to CIO for Special Interest Programs Assigns PEO responsibilities through the One Book Process Approves service acquisitions to include IT Provides CAE comments to DAES Reports Participates as a member of the TEB Identifies PM reporting directly to the CAE Jointly Identifies Special Interest IT Programs CAE Responsibilities IT Acquisition Program Responsibilities

28 DT&E StatusDT&E Earned Value As of 6/11/04, Pass 2 is 99% complete with 4 remaining functional test cases The 4 functional Pass 2 test cases are as follows: OF: BW reports ECD of 6/18/04 FI: APVM ECD of 6/18/04 PL: DFU Hierarchy ECD 6/18/04 PR: Awards in DPACS ECD of 6/15/04 Regression Testing is underway without being impacted by these 4 test cases R2.0 Pass 2 Status

29 May 04Jun 04Jul 04Sep 04Oct 04Dec 04 R2.1.1 Suffix Code Redesign Schedule Aug 04Nov 04 Design Detailed Functional Design documentation for suffix code redesign, and partial cancellations Technical Design documentation Internal and External Communications Build Build RICE objects as outlined in Technical Designs Unit testing Interface assembly testing with DAASC Develop test cases Finalize cutover schedule Design and develop and relevant training materials Internal and External Communications CDR Test System test Regression Test Training Internal and External Communications TRR ORR Cutover Kick off Design start 10 May Design end16 Jul CDR19 Jul Build start19 Jul Build end1 Oct TRR4 Oct Test start4 Oct Test end26 Nov ORR29 Nov Go Live1 Dec

30 Activity FY 2001 234 1234 FY 2002FY 2003FY 2004FY 2005FY 2006 1234123412341 Design/Build/Test System Demo (R 1.0) MILESTONE C FRPDRFOC BSM Major Milestones BPR Business Process Setting Revised BPR DESIGNBUILDTEST System Demo (R 2.0) Sys Configuration ID- Baselines Sys Deployment TEST R 2.0 Test Cycle FOTE IPR Critical Design Review DT/OA TRR R 1.1 I O C Sustainment Audits/Tests/ Verification OA IOT&E DT R 1.0 R 2.1 R 2.2 ROLLOUTS BUILDDESIGN SRR R 1.1 Test Cycle DT DESIGNBUILDTEST SRR ORR TRR CDR R 1.2/R 1.0 DPACS RETROFIT DESIGNBUILDTEST BUILDDESIGN R 2.0 R 2.2 TEST BUILDDESIGN R 1.1 ROLLOUTS Design/Build/Test System (R 2.2) Design/Build/Test System (R 2.1) System Demo (R 1.1) BDU/DISMS R 2.1 Design/Build/Test System Demo (R 1.2/R 1.0 DPACS RETROFIT) Design/Build/Test OA TRRCDRORR R 2.0 Reviews R 1.1 ReviewsR 1.0 Reviews/Test Cycle R 1.2/DPACs Test Cycle DT SRR ORR TRR CDR R 1.2/DPACs Reviews R 2.2 Test Cycle DT/OA SRR ORR TRR CDR R 2.2 Reviews R 2.1 Reviews CDR TRR ORR OA LIFE CYCLE SUPPORT 1234 OIPT IIPT R 2.1 Test Cycle P3I DT/OA As of: August 2004 Current BSM Timeline

31 BSM Master Schedule

Systems Engineering Forum Oct 15, 2004 Ver 1.16 DEFENSE LOGISTICS AGENCY Transformation -- Supporting The Warfighter.

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