4th Quarter 2007 PB48-07-41

Resource Management

4th Quarter 2007

Inside

this Issue

Transforming Resource 

Management to Support 

an Army at War: Money as 

a Strategic Weapon

2

Manger’s Internal Controls 

and Lean Six Sigma

14

Transforming Financial 

Management at Army 

Headquarters

16
Resource Management is an official professional Bulletin published 

quarterly and sponsored by the Assistant Secretary of the Army for 

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expressed herein are those of the authors and not necessarily those of 

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of Resource management. It is designed as a practical vehicle for the 

continuing education and professional development of resource managers through thought-provoking articles. Send all correspondence to: 

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Resource Management, Comptroller Proponency Office, Office of 

the Assistant Secretary of the Army (Financial Management and 

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official dissemination of material 

designed to keep individuals within the 

Army knowledgeable of current and 

emerging developments within their 

areas of expertise for the purpose 

of professional development. 

By order of the Secretary 

of the Army:

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Chief of Staff

Administrative Assistant to 

the Secretary of the Army

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Distribution: Special 

Assistant Secretary 

of the Army

Financial Management

and Comptroller

Nelson M. Ford

Managing Editor,

the Pentagon

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4th Quarter 2007 1

Contents

Resource Management

4th Quarter 2007“Professional Development”PB48-07-4

Transforming Resource Management to 

Support an Army at War: Money as a Strategic Weapon 2

BC36 Proponency Corner 7

“Growing” The Resource Management Workforce 9

SARBANES-OXLEY: Practical Application of Agency Theory 10

Manager’s Internal Controls and Lean Six Sigma 14

Transforming Financial Management at Headquarters 16

Multi-Generational Workforce 19

Continuing Education for Senior Leaders 21

Dive into the DTS Splash 22
2 4th Quarter 2007

R ES OURC E MA N A G E M EN T

Reprinted with permission from 

The Public Manager.

All managers, in both the public 

and private sectors, recognize that 

money is an essential element for 

meeting institutional objectives. While it 

might seem to be a bit of a stretch to think 

of money as a “weapon,” the case can be 

made that money is, indeed, an important 

weapon for today’s Army. This concept 

of money as a weapon has been popularized, at least recently, by General Dave 

Petraeus. Now the senior U. S. military 

commander in Iraq, General Petraeus 

commanded the 101st Airborne Division in 

the initial ground campaign of Operation 

Iraqi Freedom. In that role, he recognized 

that cash could be used on the battlefield 

to achieve positive results with local communities (building schools and clinics, 

buying intelligence and so forth) and he 

later described money as the most powerful ammunition at his disposal in fighting 

the war. General Petraeus, of course, had a 

real-time, tactical perspective on money. 

Stepping back from that perspective 

to my perspective as the Army’s Chief 

Financial Officer, I view money as a 

weapon in a more strategic sense, as something that the Army uses to deliver required 

military capabilities to the combatant commanders on the battlefield. Money, like 

Soldiers and tanks, is a finite resource, and 

my primary responsibility is to ensure that 

the Army makes the most effective and effiTransforming Resource 

Management to Support 

an Army at War: Money as 

a Strategic Weapon

HON Nelson M. Ford

Assistant Secretary of the Army 

(Financial Management and Comptroller)
4th Quarter 2007 3

cient use of this finite resource. Of course, 

this is a shared responsibility: commanders 

and senior leaders must make decisions 

about how to allocate resources among 

many, often competing requirements and 

the Army’s financial managers must support those decision-makers in understanding how to use the available funds most 

efficiently. If we can accomplish that, we 

will have done our part to be good stewards 

of our nation’s resources.

We have identified three high-priority 

actions essential to making effective and 

efficient use of the dollars the nation has 

entrusted to us and three critical conditions that will enhance our ability to 

deliver on those priorities.

ASA(FM&C) Priorities

First, we needed to figure out what 

it costs to execute the missions assigned 

to the Army. Until 18 months ago, we 

did not have a clear sense of how much 

money was required to operate and sustain the Army. Theoretically, the resourcing process starts with strategic guidance from the Office of the Secretary of 

Defense (OSD) that identifies individual 

programs necessary to achieve required 

capabilities. Army resource allocation 

decisions then determine which priorities 

must be fully funded and where we can 

take risk (i.e., not fully fund specific programs). If the process worked perfectly 

(and it never has), it would optimize the 

use of the available dollars.

Unfortunately, this process for programming and budgeting does not force a 

match between available resources and the 

capabilities called for in OSD’s strategic 

guidance. We prepare annual budget justifications and allocate available appropriations to cover as much of the requirements 

as possible. This process results in limited 

opportunities for financial managers to 

articulate the level of risk associated with 

the various shortfalls to the Army’s senior 

leaders and OSD leadership and there is 

rarely meaningful dialogue to determine 

how to bring resources and strategy into 

balance, either by increasing funding or 

reducing mission requirements.

In Spring 2006, we modeled the cost of 

the “doctrinal” Army, the cost of the Army 

called for by the National Military Strategy 

before expenses associated with deployed 

operations. The Army’s operational planners defined the size and composition of 

the Army required to meet the strategy 

and the doctrine under which the Army 

would fight. Then our cost analysts determined what it would cost to produce and 

sustain this Army.

The details of the cost modeling techniques we used in the analysis have been 

addressed elsewhere,1

 but there is one 

important factor incorporated in the 

analysis that I would like to expand upon. 

That concept is depreciation. Many people 

think that the Army shouldn’t or can’t 

apply business concepts in the same way 

they are applied in private, profit-oriented 

companies. But the two types of organization are remarkably alike when it comes to 

managing their physical assets.

Each year the Army spends tens of billions of dollars to build facilities and buy 

the equipment that our forces need to fight 

current and future wars. While we don’t 

calculate the return on investment associated with these acquisitions, these assets 

have finite useful lives; they will wear out 

over time. If the Army was planning to go 

out of business after each war, the gradual 

reduction in useful life of these assets 

would be of little concern. But such is not 

1

 For a complete discussion of the costing analysis, see “The 

Cost of the Army,” by the Honorable Nelson Ford and Joe 

Gordon, in The Armed Forces Comptroller, Winter 2007.

the case. Rather, to use another private 

sector concept, the Army is a “going concern,” an organization that has to be ready 

to come to the nation’s defense immediately and is going to operate indefinitely. 

Therefore, the Army needs a sustained 

level of investment to replenish its capital 

equipment. While we know this intuitively, we give this fact minimal attention 

when we make our resourcing decisions. 

Rather than set aside the funds to replace a 

certain percentage of our assets each year, 

we focus on what we need today. When 

resources are less than requirements, i.e., 

when money is less than mission, we pay 

Soldiers and train on existing equipment 

before we invest in tomorrow’s requirements. Often, that leads to penny-wise, 

pound-foolish decisions on what we know 

we’ll need to do in the future. The analysis of the cost of sustaining the doctrinal 

Army addressed this long-standing problem by incorporating depreciation of our 

equipment, including weapons and the 

buildings on our posts, camps and stations, into our estimate.

In summary, this analysis told us that 

the cost of the doctrinal Army was approximately $138 billion per year in Fiscal Year 

2008 (FY08) dollars, $24 billion more than 

the Army’s FY08 resource guidance from 

OSD. Army leadership took this analysis 

to the Secretary of Defense and, following extensive review of the Army’s fiscal 

situation, OMB added funds to the FY08 

President’s budget request to partially 

close the gap. In early 2007, we updated 

the estimate to reflect President Bush’s 

decision to grow the Army by 74,000 

Soldiers. The current cost estimate for sustaining the Army at its proposed size and 

mission is $152 billion in FY08 dollars. 

Unfortunately, this analysis does not 

drive the federal budget process, either 

within DoD or in Congress. DoD has 

all the military services to consider, and 

our congressmen have their constituents’ 

concerns to deal with. The outcome of 

balancing requirements within DoD and 

across the government, even given the 

Constitutional imperative for defense of 

the nation, mitigates against the Army’s 

ASA (FM&C) Priorities

• Embed “cost of the Army” in 

the resource decision-making 

process

• Re-establish strong 

management controls

• Migrate funding from the 

supplemental budget back to 

the base budget
4 4th Quarter 2007

R ES OURC E MA N A G E M EN T

needs being fully funded. Nonetheless, to 

make sure that decision-makers don’t lose 

sight of our requirements, we strive to 

quantify them carefully. At the very least, 

cost-based analysis gives us factual data 

that enable us to describe what we can and 

cannot do with the available resources and 

what we need to be ready to do.

Second, we must re-establish strong 

management controls throughout the 

Army. In the past, most of our time and 

energy has been spent formulating, submitting, and defending the budget. This 

is an important responsibility, because 

without adequate and timely flow of funds 

from Congress, the Army would grind 

to a halt. However, while recognizing the 

importance of the budgeting function, we 

also have to refocus our attention on management controls over the resources that 

Congress has given us so that we can:

• safeguard our assets, 

• ensure compliance with laws and 

regulations,

• provide Congress and the American 

people confidence in how we are 

managing the funds entrusted to us,

• and, perhaps most importantly, make 

the best use of the funds the budgeting process gives us.

During the first part of the current 

fight, we experienced gradual but real 

erosion in our control systems. We have 

heard the term “battlefield accountability.” 

Battlefield accountability recognizes that 

the need to be effective in the heat of combat operations doesn’t always lend itself 

to peacetime accountability practices. But 

over time, as combat operations turned 

slowly into persistent conflict, both the 

public and the Congress expected that our 

controls performance would reflect peacetime accountability standards.

We have been working on this problem for the last 24 months and materially 

strengthened the Army’s critical controls 

with no loss of mission effectiveness. 

We’ve been focused on deploying systems 

and developing policies that will help us to 

reduce costs; improve the linkages among 

the Army’s finance, procurement, and 

logistics functions; and provide better support to Soldiers and commanders.

Over the past two years we have made 

good progress on the first two priorities: 

understanding the costs of sustaining the 

Army indefinitely and re-establishing 

controls. I’m proud of the hard work 

that’s been done throughout the financial 

management community, and I have every 

expectation of continued progress.

The third and final priority is an area 

where most of the work still lies ahead of 

us. That priority is to reduce our reliance 

on supplemental budgets and move funding for core activities back into the base 

budget.

In the federal budget process, we use 

our “base” budget for the cost of normal, 

day-to-day operations and use supplemental budgets to fund contingencies that 

were not anticipated when the budget was 

developed. Thus, it is appropriate for the 

incremental costs of the global war on 

terror to be covered with supplementals. 

Unfortunately, as the war has continued, 

the supplemental budget has come to 

include much more than just the incremental costs of the contingency. While the 

Army was ready to provide the capabilities 

needed when we entered Iraq in 2003 , the 

many years of resource shortfalls made 

it difficult to sustain the supply of forces 

necessary to meet the increasing demands 

of the CENTCOM commander. We had 

to activate, mobilize and train the reserves; 

replace old and buy new (and better) 

equipment; and rebuild worn out posts, 

camps and stations. 

Since 9-11, we have increasingly used 

supplemental budgets to provide not 

only the funds for incremental costs but 

also to pay for the accumulated capability deficit. In other words, supplementals 

have been used, in part, to fund costs that 

should have been in the base budget all 

along. This was not a secret. Financial 

professionals in all parts of the Federal 

Government recognized this fact and, for 

various reasons (e.g. supplemental spending isn’t “scored” in the budget process), 

condoned it. Thus, over the past five years, 

the boundaries between base activity and 

contingency activity have become blurred.

The accompanying chart describes the 

situation. The gray portion of the bars is 

the funding we’ve received or requested in 

our supplemental budgets, stacked on top 

of the base budget represented in black. 

The shaded area indicates the migration of 

base activity and funding into the supplemental. Our concern is that each year an 

increasing portion of our base activity is 

being funded outside the normal appropriations process. On a percentage basis, this 

is not a huge problem, but it does represent 

billions of dollars of spending that needs to 

be reincorporated into the base budget.

The problem is likely to become more 

challenging in the near future. While a 

sound case can be made for increasing 

defense spending, history tells us that 

the opposite is a very real possibility. 

Throughout our history, the United States 

has harvested “peace dividends” by dramatically reducing military spending at the 

end of each war, sometimes before active 

Improvements in Army 

Financial Controls

• Wide Area Workflow reduces 

transaction processing costs 

and improves the linkages 

between the Army’s finance 

and procurement functions

• Funds Control Module provides 

real-time obligation of logistics 

transactions and improves 

the synchronization of finance 

data and logistics data

• Defense Travel System 

reduces transaction 

processing costs and 

reimburses travelers faster

• Revised policies for managing 

long-term contingency 

manning requirements improve 

controls and reduce costs
4th Quarter 2007 5

hostilities have ended. This happened in 

1781, when Congress reduced support for 

the Continental Army while British forces 

still occupied New York and other major 

cities, and it has happened repeatedly since 

then. The accompanying chart highlights 

the recent history of Defense spending 

in both real terms and as a percentage of 

Gross Domestic Product and illustrates the 

difficult questions the nation must address 

in this time of persistent conflict.

The problem comes into clearer focus 

when we add the annual cost of the doctrinal Army to the picture. If the war were 

to end tomorrow and the Army’s budget 

returned immediately to the FY 2008 base 

budget level, the resulting strategy-resourcing mismatch would be approximately $25 

billion. Even without an immediate end to 

the war, we expect that the usual political 

pressures will push for significant reductions in supplemental funding. 

With this prospect in sight, we can 

choose between two courses of action. If 

we stand back and do nothing, supplemental funding will dry up with no restoration of the base, the Army’s capabilities 

will atrophy, and the risk that the Army 

will not be ready for its next mission will 

increase. Instead, we believe we can make 

a persuasive case to migrate crucial activities back into the base.

Adopting a Cost Culture

The implementation of all three priorities will be enhanced if the Army adopts 

what I call a “cost culture.” Before defining 

a cost culture, it is important to understand how the Army’s “culture” works and 

how we can achieve “cultural change.” 

These terms are in common usage but I’m 

not sure that everyone uses them in the 

same ways. In any organization, large or 

small, “culture” refers to how the group 

behaves and what it believes. For example, 

the military culture values mission accomplishment, selfless service, valor, and dedication – concepts that help establish the 

foundation for how our Soldiers, sailors, 

airmen, and marines go about their duties. 

These are concepts and aspects of the military culture that we can all understand.

When we say we intend to adopt a 

cost culture within the Army, what do 

we mean? One way to think about it is 

to imagine what the world will look like 

when the initiative is successful. The box 

on the next page identifies the kind of 

behaviors we expect Army leaders and 

managers to exhibit once a cost culture has 

taken root. The essence of these behaviors 

is incorporating cost considerations into 

all decision-making; it must become second nature, not just an afterthought that 

takes a back seat to operational, political 

and other considerations.

0

20

40

60

80

100

120

140

160

180

200

220

240

260

FY04 FY05 FY06 FY07 FY08

Actual Execution Appropriation

Army Base and Supplemental Budgets 

($ Billions–Current Dollars)

Base budget Supplemental budget * Pending Congressional Action

$111B $129B

$109B $118B*

0

50

100

150

200

250

300

350

400

450

500

550

600

650

1945 1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 2000 2005

0%

Korea

Vietnam

Reagan 

Buildup

War on 

Terrorism

$618B

$567B $480B

$518B

$600B+

Budget Authority Constant FY07 $ in B 

DoD Outlays % of Gross Domestic Product (GDP)

Korea 

14¡2% Vietnam 

9¡5% Reagan 

Buildup 

6¡2% 

3¡0% in 2000–Lowest 

since prior 

to World War II. 

GWOT 

3¡9%

WW II 

37¡9%

Historical Funding Trends DoD Budget Authority Since WW II

30%

20%

10%

Budget authority Outlays as % of GDP
6 4th Quarter 2007

R ES OURC E MA N A G E M EN T

If this is what we are trying to accomplish, how should we go about implementing this idea in the Army? Because cultural 

change is not easy, we are starting with a 

three-pronged approach.

First, we plan to get the Army’s senior 

leaders actively engaged in effective cost 

management. Top-down support and 

buy-in is essential to the success of almost 

any management initiative, and this is certainly true of changes that challenge our 

underlying assumptions about how the 

world works. Fortunately, in a hierarchical 

organization like the Army, members of 

the organization quickly learn to emulate 

the behavior of the boss. If a leader gives 

lip service to cost management issues 

(but his behavior demonstrates that cost 

considerations are unimportant), subordinates will follow suit. But if, on the other 

hand, resource stewardship and trade-offs 

between cost and performance are part 

of every conversation that subordinates 

have with the boss, they will quickly get 

the message and alter their behavior. 

Therefore, we plan to educate the Army’s 

leaders in cost management, beginning 

with our most senior leaders.

Second, a cost culture requires robust 

analytical tools and systems that provide 

accurate, timely information to support 

decision-making. While we have some 

systems today that provide good decisionsupport information, we need enterprise 

solutions that support the more rigorous 

analysis necessary to understand today’s 

complex, inter-connected Army. This 

is why the development and fielding of 

GFEBS – the General Fund Enterprise 

Business System – continues to be our 

number one system priority.

GFEBS is an enterprise system that 

incorporates three different, but related, 

views of money: the financial operations 

view that looks back in time to support 

the legal requirements for accounting, 

reporting and auditing; the budget view 

that shows how we are allocating resources 

today and tomorrow; and the cost management view that assesses affordability 

of various courses of action for the future, 

enables performance assessments, and 

frames investment decisions (as informed 

by depreciation of assets). GFEBS will 

synchronize these views of money and 

provide real-time reporting to financial 

managers and leaders to better inform 

decision making. 

Third, we need to bring greater discipline to our resource decision-making 

processes, primarily in achieving a balance 

between the demand and supply sides of 

DoD. Demand is defined by the combatant 

commanders and Joint Staff, who identify 

what they need in order to accomplish their 

missions. Supply to meet those demands 

is provided by the military department 

headquarters and those Defense agencies 

responsible for developing programs that 

produce required capabilities. The interface 

between supply and demand is difficult to 

manage in the best of times. In wartime, 

when the urgency of today’s requirements 

makes it difficult to simultaneously address 

the future, it becomes even more difficult. 

That is why it is so important for us to 

understand the true cost of delivering capabilities so we can make informed decisions 

for balancing supply and demand. Our use 

of money in this way gives our Army a very 

effective tool in executing today’s fight and 

preparing for the one over the horizon.

Conclusion

To recap what I’ve said in these pages:

• My goal is to make sure that the 

money we receive provides effective capabilities efficiently so that we 

maximize our “ bang for buck” now 

in a period of persistent conflict.

• I have three priorities: understanding the cost of the Army as a “going 

concern,” strengthening financial 

controls, and migrating core activities 

back into the base budget.

• Achieving these priorities can be 

enhanced by developing a cost culture 

throughout the Army.

• To implement this cost culture, we 

need to do three things: get senior 

leader engagement, build robust analytical tools, and bring greater discipline to our resource decision-making 

processes.

If we are successful, we will serve the 

Army and the American public well by 

optimizing our resources in support of our 

nation’s defense.

About the Author

The Honorable Nelson M. Ford serves as 

the Assistant Secretary of the Army for 

Financial Management and Comptroller. 

His previous position was Principal 

Deputy Assistant Secretary of the Army for 

Financial Management and Comptroller. 

He has also served as the Deputy Assistant 

Secretary of Defense for Health Budgets & 

Financial Policy, as Executive Secretary of 

the Health Care Financing Administration, 

and at the Office of Management and 

Budget. In the private sector, Mr. Ford has 

held senior management positions in academic medicine, medical manufacturing, 

and health insurance and has served on the 

boards of many not-for-profit organizations.

In a Cost Culture, Critical 

Questions are Embedded 

in All Decision-Making

• What capabilities is my 

organization responsible for 

producing, and what do they 

cost?

• What are the key cost drivers?

• How can I generate the 

required capabilities more 

effectively and efficiently?

• How can I reduce management 

overhead and indirect costs?

• How can I use cost information 

to make better decisions?
4th Quarter 2007 7

T his is the first in a series of articles 

that will explore the implications of 

the transition to Branch Code 36, 

the Army’s financial manager, through the 

DOTMLPF lens of doctrine, organization, 

training, materiel, leadership and education, personnel and facilities. 

The next five to 10 years will be an 

important period in Army history. Every 

portion of transformation will become 

reality; the ensuing changes will be numerous and widespread. The financial management community is slightly ahead of 

the overall transformation curve: we will 

achieve our primary goal – the creation 

of a unitary FM corps with a revamped 

mission and doctrine – in less than a 

year. Though it would be impressive to 

claim this significant change was achieved 

quickly, the truth is it’s been a long time in 

the making.

The quest to develop unified financial 

management in the Army began a decade 

ago. In 1997, financial management doctrine was revamped to match the operational dynamics of the modular, tailorable 

and highly deployable Force XXI concept. 

Field Manual 14-100 integrated resource 

management operations and finance 

operations, and created a single battlefield 

doctrine for the financial management 

community. 

To facilitate full implementation of 

the tenets outlined in FM 14-100, thenAssistant Secretary of the Army (Financial 

Management and Comptroller) Helen 

McCoy asked the proponents for finance 

(BC44) and comptroller (FA45) to examine the feasibility of combining the two 

disciplines into one. The objective was to 

develop a world-class financial manager 

and FM organizational structure that 

would effectively and economically support and serve battlefield commanders. 

With this simple request, financial management transformation was under way 

– a full two years before Gen. Eric Shinseki 

announced the inception of overall Army 

transformation.

The decision to merge the separate 

pieces of the financial management community into a unified whole opened the 

door to evaluating FM doctrine. Working 

together, senior leaders from the finance 

operations and resource management 

communities spent more than nine years 

developing a financial management doctrine appropriate to the Army’s needs. 

Soon we will finish implementing the first 

round of major changes associated with it.

For instance, lessons learned from 

operations during the 1990s indicated the 

need for standing deployable resource 

management units. Nearly all resource 

management positions were assigned to 

the TDA rather than the TOE, and there 

was no RM force package prepared to 

deploy -- leaving a systematic void in battlefield support capability. Resource management support in theater was effected 

through ad hoc groups of comptrollers 

pulled from various TDA units and the 

Individual Ready Reserve. 

In 2002, the Financial Management 

communities agreed on a modular construct to rectify this warfighting deficiency. Traditional FM structures, such 

as finance battalions, finance groups and 

finance commands, would be eliminated. 

Instead, the Army would completely integrate finance and resource management 

capabilities into financial management 

companies, financial management centers, 

and division, corps and joint (G-8 and J-8) 

resource management.

These revisions to organizational strucBC36 Proponency Corner

Lieutenant General David F. Melcher, Military 

Deputy for Budget, 

Assistant Secretary of the Army (Financial 

Management and Comptroller)

Major General Edgar E. Stanton III, Director of 

the Army Budget (Financial Management and 

Comptroller)
8 4th Quarter 2007

R ES OURC E MA N A G E M EN T

ture and function necessitated personnel 

changes. The Army therefore in 2005 consolidated enlisted Military Occupational 

Specialties 73C (finance specialist) and 73D 

(accounting specialist) into a single MOS, 

44C (financial management technician). 

The Army is similarly merging resource 

management and traditional finance functions in the officer corps, as well. The 

process will be finished in FY 2009, when 

a new officer specialty, BC 36A, formally 

replaces BC44 and FA45 competencies. 

With a different structure and multiskilled FM personnel, the Army will have a 

complete FM package that supports homestation and operational requirements 

for commanders at the Army Service 

Component Command level and below. 

Commanders finally will have a single 

focal point for FM operations, whether in 

garrison or deployed. Financial management companies, which will be part of 

theater early entry modules, will establish 

FM requirements, coordinate logistics 

for the main body reception and provide 

advice regarding available FM resources to 

commanders. On the battlefield, financial 

managers will be more important than 

ever, holding responsibility for: supporting the procurement process; providing 

accounting, banking, currency, limited 

pay, travel and multinational support; 

administering the savings deposit program 

and the stored value card; training and 

funding paying agents; making claims 

and solatium payments; and supporting 

rewards programs. 

Financial managers also will serve as 

leaders for sound budgeting and fiscal 

prudence in theater, at Army installations and at Army headquarters. The FM 

community will continue to participate in 

developing financial policy, annual budgets and the long-term program. Financial 

managers also will track commitments and 

obligations; evaluate, certify and report 

execution of funds; and maintain regulatory accountable records. In addition, 

financial managers will remain responsible 

for establishing management control processes, protecting precious Army resources 

from fraud, waste and abuse, and ensuring 

that the Army adheres to regulatory guidelines, directives and procedures. 

The Army’s FM community is proud of 

the very important reforms it has achieved 

so far. Transformation is not easy and it 

isn’t quick; there are still miles to cover 

down this long road. But the Army, and its 

financial management community, remain 

committed to the process and doing what 

is right for our Soldiers, the Defense 

Department and the Nation.
The Comptroller Proponency (CP) Office held an 

Intern Focus Meeting in September 2007. This meeting 

was conducted to provide a better understanding of the 

CP11 Intern program requirements. The attendees included 

interns, their supervisors, and CP11 intern coordinators. 

What made this training session different from previously 

held? It required mandatory supervisors’ attendance. There 

were over 78 participates in attendance of this successful 

event. Session topics included an overview of the CP11 

Career Management, an update of the CP 11 Department 

of Amry (DA) Intern Program, professional development opportunities, and presented information regarding 

Supervisors and Interns roles and responsibilities and the 

National Security Personnel System (NSPS).

One of the main issues addressed was how to attract 

new people into the CP11 Intern Program. The discussion 

prompted us to initiate the development of a marketing 

plan specifically for our Intern Program.

The concept consists of a targeted multi-media advertising campaign, which includes advertisements in professional and technical journals, magazines, newsletters, and 

newspapers. Our ability to advertise in the college and university magazines, newspapers, and/or radio stations will be 

significant to reaching a segment of our target market. 

How do we do this? This effort requires the formulation of postive relationships with the universitites’ Career 

Counselors, the installation’s career representatives and our 

Sister Services. We view the key to successful recruiting as 

getting the message out to the public. Our plan is to use 

flyers, brochures, the Internet, and current and graduated 

interns to participate in recruiting events. Materials will 

include a general description of the CP11 Intern program, 

eligibility requirements, dates and times of recruiting 

events, and additional information regarding how the program would benefit the potential candidate. 

The CP11 Intern Program is an excellent two-year professional development program offering permanent upward 

mobility positions with the federal government. The intern 

receives formal classroom and on-the job training designed 

to provide them with the knowledge of financial management to include accounting, auditing, budgeting, costing 

and program development. Interns will conduct execution 

reviews; compile and analyze data, identify trends, and 

apply fiscal policy and guidance. 

The first six months of the CP11 Intern program provides an orientation to federal employment, the Department 

of the Army/Department of Defense, the individual’s organization, and formal on-the-job training. Based on the needs 

of the individual employee, this phase may also include 

training in general skills such as writing, briefing techniques, 

and automation applications. Training in the core competency areas of Financial Stewardship and Financial Decision 

Support usually begin at the halfway point of this phase. The 

second six-month phase emphasizes completion of the general skills training requirements. Financial Stewardship and 

Financial Decision Support training continues in this phase. 

Beginning in this phase is the necessary training in the third 

core competency group of Organizational and Leadership 

Management. Phase 2 may also include rotational assignments. Any further general skills training should be completed during this phase. The final 12 months of training 

in Financial Stewardship, Financial Decision Support, and 

Organizational and Leadership Management continue with 

a primary emphasis on completing a minimum of two, 

90-day rotational assignments. Rotational assignments are 

scheduled so that the interns are exposed to most, if not all 

the supporting competency areas associated with Financial 

Stewardship and Financial Decision Support and at various 

levels of Army financial management (installations, commands, direct reporting units, HQDA). 

The CP11 Intern program is open to all applicants based 

on the eligibility requirements that follow: (1) Applicants 

must be U.S. Citizens (2) Applicants must complete a 

degree-granting program of study at an accredited U.S. 

institution of higher education recognized by the U.S. 

Department of Education and/or (3) one year of specialized 

experience. The goal is to “Grow People”.

If you would like additional information regarding 

the CP11 Intern Program please contact the Comptroller 

Proponency Office (703) 614-3667.

“Growing” The Resource 

Management Workforce

By Comptroller Civilian Functional Chief Representative - Terry Placek

4th Quarter 2007 9
10 4th Quarter 2007

R ES OURC E MA N A G E M EN T

In 2003 as a recent graduate of the 

Army Comptrollership Program, I submitted my first article for publication in RM 

Magazine on the topic of agency theory. 

Agency theory involves the study of the 

principal-agent relationship and its significance to the basic functioning of economic 

systems. In the article I discussed the current relevance of the theory to understanding the decisions of corporate finance and 

explained how, for example, agency theory 

serves as an effective lens for studying the 

problem of corporate malfeasance and 

developing solutions to protect against it. 

Four years later, I am both surprised and 

intrigued to find myself administering a 

program that directly seeks to convert this 

theory into practice. Since beginning my 

rotation as a participant in Training with 

Industry (TWI) at General Electric (GE), 

I have served as one of the facilitators for 

the business’ Sarbanes-Oxley program 

(more commonly referred to as SOx). This 

article will define SOx by describing the 

enacting legislation and its relevant history, discuss GE’s efforts to implement 

SOx at the business unit level, and conclude with a comparative analysis of how 

corporate America’s SOx programs relate 

to the US Army.

History/Legislation:

The Sarbanes-Oxley Act came into 

force in July of 2002 as a U.S. legislative 

response to a series of major corporate 

accounting scandals including those 

affecting Enron, Tyco International, 

and WorldCom.1

 The failures of these 

businesses exposed serious weaknesses 

in the system of checks and balances 

protecting the interests of shareholders and disrupted the confidence of the 

American public in the stability of U.S. 

capital markets. Though the abuses were 

confined to a relatively small number 

of companies, the provisions of SOx are 

applicable to all publicly registered companies under jurisdiction of the Securities 

and Exchange Commission. Sponsored 

by Senator Paul Sarbanes (D-MD) and 

Representative Michael Oxley (R-OH), 

the legislation is aimed at restoring public 

trust in accounting practices by ensuring 

the accuracy and timeliness of financial 

reporting (i.e. the financial statements 

relied on by shareholders, management, 

directors, regulators, lenders, investors 

and the market at large). It also seeks to 

restore investor faith by accomplishing 

greater transparency in corporate finance, 

accountability for corporate officers, 

auditor independence, auditor oversight, 

and the ability to prosecute. 

Provisions:

Like other regulatory requirements, 

some sections of the act are more pertinent to compliance than others. One of 

1

 Sarbanes-Oxley Act of 2002, PL 107-204, 116 Stat 745.

SARBANES-OXLEY: Practical 

Application of Agency Theory

By Major Andrew J. Hyatt
4th Quarter 2007 11

the most critical is Section 404, which 

details the management assessment of 

internal controls. So, what exactly are 

internal controls? Internal controls are the 

methods and measures used by a business 

to monitor assets, prevent fraud, promote operational efficiency, and ensure 

that established managerial polices are 

followed. Having effective internal controls over financial reporting ensures a 

company’s ability to fulfill its obligation 

to its investors who rely on the reported 

financial information in making decisions. 

Section 404 of SOx focuses on the documentation and testing of these internal 

controls. Section 404 specifically requires 

a company’s management to make affirmative assertions on the effectiveness of 

its controls and also requires its external 

auditors to provide an attestation to the 

same. To do this necessitates that a company’s management document, evaluate, 

and test all controls that are deemed significant to the financial reporting process. 

This requirement places great pressure on 

companies and, not surprisingly, is both 

costly and time consuming. For these reasons and for most businesses, especially 

smaller ones, Section 404 is the most contentious aspect of SOx.2

GE Background:

Before continuing, let me quickly provide some useful background information 

about General Electric Company. GE is 

a multinational technology and services 

conglomerate. Headquartered in Fairfield, 

Connecticut, GE is structured into six primary business segments: GE Commercial 

Finance, GE Healthcare, GE Industrial, 

GE Infrastructure, GE Money, and NBC 

Universal. Within each of these stronger 

business segments is a portfolio of several 

aligned smaller business units. For example, within GE Infrastructure are business 

units of Aviation, Transportation, Energy, 

and Oil and Gas. Though SOx is a GE 

corporate program, the individual business 

units share direct responsibility for implementing SOx requirements. 

2

 “Sarbanes-Oxley Act,” 28 October 2007. <http://

en.wikipedia.org/wiki/Sarbanes_oxley>.

SOx Methodology:

Historically, GE’s approach to SOx was 

a “bottom-up” process. At each of the different business units, SOx efforts began 

with an initial review and determination 

of scope. Scoping involved analyzing the 

business’ balance sheet and identifying 

which financial accounts or cycles could 

cause a material misstatement to their 

financial statements. Some examples of the 

different types of financial accounts and 

cycles include inventory, accounts receivable, accounts payable, and revenue recognition. Business units determined scope 

by reviewing the individual asset coverage 

and associated risk within these accounts. 

The risk assessment was based on factors 

such as the size of an account, dollar volume, accounting complexities, complexity of transaction processes, etc. Business 

units also considered issues affecting 

financial accounts such as changes from 

prior years, continuity of staff, prior audit 

findings, account reconciliation issues, or 

simply if the process is considered particularly significant. Points were assigned 

to each factor and, after each account was 

evaluated, they were designated according 

to risk. Only high-risk accounts became 

part of the SOx scope. This methodology, 

however, proved challenging as business 

units were identifying an extensive amount 

of controls, some of which were not significant at the higher corporate level.3

New guidance provided by the Public 

Company Accounting Oversight Board 

(PCAOB) in 2004 allowed businesses to 

better focus SOx efforts on only those 

areas deemed of greatest risk.4

 Since that 

3

 “Controllership at GE,” 28 October 2007. 

<http://libraries.ge.com/foldersIndex.do?entity_

id=2721080101&sid=101&sf=1&prod_id=0>.

4

 “An Audit of Internal Control Over Financial Reporting 

Performed in Conjunction with an Audit of Financial 

Statements.” March 2004. PCAOB Release No 2004-001. 3 

November 2007. < http://www.pcaobus.org>.

time, GE and most other public companies follow more of a “top-down” process. 

This means that GE’s corporate headquarters determines the initial SOx scope. 

Corporate performs a risk assessment of 

the company’s combined balance sheet and 

identifies the key segment balances that 

compose an account balance. Individual 

business units then perform their own risk 

analysis to confirm the scope determined 

by Corporate. This has several advantages 

over the previous approach including 

the focus on only high risk accounts, less 

overall test work, standardization across 

GE businesses, centralized reporting and 

management, and the ability to leverage 

technology and best business practices. 

Controls:

After scoping is complete and the 

associated financial cycles determined, the 

business units must begin the more deliberate process of identifying the internal 

controls that will be tested. Not all controls 

will be tested; rather, only key internal 

controls. A key component of this strategy 

is the understanding that not all risks, 

accounts, and transactions are equally 

important. As defined previously, controls 

are the methods and measures used by a 

business to monitor assets, prevent fraud, 

promote operational efficiency, and so 

forth. Controls typically have three defining characteristics: frequency, category, 

and type. Frequency indicates the rate 

of control occurrence (i.e. daily, weekly, 

monthly, etc). Category defines whether 

the control is preventive (control prevents 

risk from occurring) or detective (control 

detects the event after it occurs). Type 

refers to whether the control is manual or 

automated. Examples of the more common types of controls are authorization 

controls, segregation of duties, reconciliations, and management review.

Controls typically have three defining characteristics: 

frequency, category, and type.
12 4th Quarter 2007

R ES OURC E MA N A G E M EN T

So how does this work in the real world? 

Let’s take the financial process of inventory as an example. Within a GE business 

unit like Transportation, sales for freight 

locomotives and services measure in the 

billions. Supply chain management of the 

production facilities and integrated processes here is critical. The amount of physical inventory involved, which represents 

thousands and thousands of individual 

parts, is staggering. Being able to accurately 

value inventory is essential and inability 

to accurately value inventory could lead 

to deficiencies in the business’ financial 

reports. Thus, there is a high degree of 

risk associated with the inventory process 

and the business incorporates appropriate 

internal controls to mitigate this risk. The 

simplest example of an inventory control is 

the physical counting of items. A test of this 

control would be nothing more than having 

two different individuals perform the same 

physical count on an item and ensuring the 

results match.

A second and even more common 

example of a control that most people are 

familiar with is a computer userid and password protection. This is an example of an 

Information Technology (IT) system access 

control and is clearly a preventive control. 

The lockout that typically occurs after 

three failed logons is a secondary control. 

Notably, IT controls can be just as important to a company’s proper financial reporting as its finance controls. Within GE, there 

are numerous IT applications including 

both financial analysis and human resource 

systems. These Oracle-based applications 

and their massive databases enable the dayto-day transactions of most GE businesses 

and are absolutely essential to proper financial reporting. The testing of such key IT 

systems is therefore a critical component of 

the overall SOx process.

Initially identifying the controls within 

each financial cycle occurs through a practice called mapping. Mapping involves 

developing a graphical representation of 

a process, such as a flowchart, that shows 

the basic overall steps or sequences of 

events and actions that produce an outcome. Once mapped, process owners can 

perform a general analysis of the financial 

cycle and determine any areas where risks 

exist. Process owners can then evaluate 

if existing controls are in place that will 

mitigate the risks. The desired byproduct 

of the mapping process is a risk control 

matrix. The risk control matrix allows the 

process owners to align each identified risk 

against its associated control. This facilitates ranking and weighting the controls in 

order to determine which are key controls. 

This is a key step because, as noted before, 

only key controls will undergo testing.

Ultimately, thorough testing is performed around each of the identified key 

controls. Testing both tests the capability 

of a control to mitigate risk as well as the 

effectiveness of a control to mitigate a risk. 

Testing techniques vary greatly. I previously described one test used for physical 

inventory where two different people perform a count of the same items (re-performance). Other examples of testing include 

inspection of documentation, inquiry and 

observation, and knowledge assessment. 

Regardless of the test work performed, 

SOx requires that it be clearly documented, 

self-explanatory, independent, and able to 

stand up to a third party review. 

Putting it Together:

Payroll is one of the largest expense 

items that affect a company’s financial 

statements—both the balance sheet and 

income statement. Payroll includes all 

labor costs (wages, benefits, and other 

labor-related expenses) and, in some cases, 

payroll might represent 40-60% of a business’ entire budget. Notably, organizations 

make payroll errors, which according to 

the IRS, costs billions of dollars in penalties each year.5

 Payroll errors can result 

from a variety of events such as inaccurate 

capture of workers’ hours, complex pay 

rules, and retroactive pay adjustments, as 

well as initiatives such as the migration 

from manual to automated payroll systems. The challenge and risk that payroll 

inaccuracy represents for SOx compliance 

is apparent and, given the dollar value of 

payroll transactions, inadequate controls 

over payroll processing and reporting 

could easily lead to a misrepresentation of 

a business’ financial condition.6

 So how in a SOx environment does 

a business actually test payroll controls? 

Included is a simple illustration of a process map for a payroll account. Following 

the SOx methodology, a company would 

be able to use such a product to identify 

payroll risks and the associated key internal controls. For example, a valid risk 

could be overpayment to existing employees or payment to employees who are no 

longer actually working for a business. 

Feeding accurate time and attendance 

data into the payroll management process 

is clearly critical to the accurate calcula5

 Bowman, Brian. “Laboring over Sarbanes-Oxley,” 

October 2005. Sarbanes-Oxley Compliance Journal. 3 

November 2007. <http://www.s-ox.com>

6

 “Payroll and Sarbanes-Oxley,” December 2004. 3 November 2007. <http://www.ioma.com/audioconferences/339.

html>

1 2

3

risk area/control

This notional payroll map reflects generic steps involved in processing employee hourly pay. Inherent risks 

here might include 1) inaccurate/fraudulent recording of employee hours, 2) software integration issues, 

and 3) overpayment to existing employees or payment to employees who are no longer actually working for 

the business. Each identified risk must be mitigated by an appropriate internal control. Sarbanes-Oxley 

requires that all key controls are tested for their capability and effectiveness to mitigate the risks.

Payroll Process Map

Time Card 

Generation

Posting to 

General Ledger 

Zero 

to Gross

Gross Payroll

Pre-processing

Payroll 

Distribution

Book Journal 

Entries

cycle step

Account

Recs

Gross 

to Net

Legend:
4th Quarter 2007 13

tion of employee pay. A basic control 

here would be to review payroll reports to 

ensure all listed employees exist and are 

actively at work (a detective control). The 

test for this control would simply involve 

selecting a sample of employee files from 

personnel/human resources, determining 

that the files are complete (job application, 

references, wage rate authorizations, etc.), 

and cross-referencing the information to 

related information in payroll accounting. 

Another control might be that a business 

only pays employees for hours recorded on 

timesheets. A test for this control would 

involve randomly sampling time cards 

submitted and reconciling them to payroll 

accounting records to see if employees 

who turned in a clock card were paid, pay 

was accurate, and recorded payments were 

for work actually performed by existing 

employees. All these test can be performed 

on a weekly, monthly or quarterly basis 

or as part of scheduled testing by payroll 

professionals, or as often as needed by 

internal auditors. 

Management Controls and the 

US Army:

Though SOx is not applicable to the US 

Army, there are many direct similarities 

between SOx and the Army’s Management 

Control Program (MCP). Like SOx, the 

Army’s management control process 

stems from federal legislation. The Federal 

Managers’ Financial Integrity Act of 1982 

(Public Law 97-255; 31 USC section 3512) 

requires the head of each executive agency 

to “establish management controls to provide reasonable assurance that: obligations 

and costs are in compliance with applicable 

laws; funds, property, and other assets are 

safeguarded against waste, loss, unauthorized use, or misappropriation; revenues 

and expenditures are properly recorded 

and accounted for; and programs are efficiently and effectively carried out according to the applicable law and management 

policy.”7

 Within the Army, the management control process is codified in Army 

7

 Army Regulation 11-2 (Management Controls). August 

1994. p.1. 28 October 2007. <http://www.usapa.army.mil/

pdffiles/r11_2.pdf>.

Regulation 11-2 (Management Control).

Comparable to Section 404 of SOx, the 

Federal Manager’s Financial Integrity Act 

requires the direct involvement of leaders 

at all levels in providing an assessment 

regarding the effectiveness of internal controls. Annually, the Secretary of Defense 

must submit his Statement of Assurance 

to the President and the Congress. The 

Secretary’s statement, in turn, is supported 

by a statement from the heads of each 

DOD component, whose statements are 

further supported by similar statements 

from successive levels of subordinate 

commands. The responsibility for implementing and reporting on management 

controls extends to the lowest levels of the 

Army’s command and management. In all 

cases, the annual statements of assurance 

are personal certifications regarding the 

effectiveness of management controls.8

The Office of the Assistant Secretary 

for Financial Management and 

Comptrollership (ASA{FM&C}) is the proponent for oversight and management of 

the Army’s Management Control Program. 

As such, it develops the policies and procedures used to ensure the Army achieves 

its planned objectives of effective and efficient operations, reliable financial reporting, and compliance with applicable laws 

and regulation. The Army management 

control policy states: “all commanders and 

managers have an inherent responsibility 

to establish and maintain effective management controls, assess areas of risk, identify 

and correct weaknesses in those controls.”9

Again, the similarities of SOx and MCP in 

both concept and language are clear. For 

instance, the Army’s MCP also makes a 

specific distinction regarding key management controls – a distinction similarly 

based on a recognition of the requirements 

imposed on managers attempting to evaluate more controls than necessary and the 

associated cost involved versus the benefits 

derived. The Army defines key management controls as those that are “absolutely 

8

 Army Management’s Responsibility for Internal control. 

(December 2005). 28 October 2007. <http://www.asafm.

army.mil/fo/fod/mc/awpe/memos/amr121505.pdf>.

9

 Army Regulation 11-2 (Management Controls), p. 3.

essential to ensuring that critical processes 

operate as intended and that resources 

are safeguarded from fraud, waste and 

misuse.”10 Only key management controls 

must undergo actual testing, which is done 

using the familiar techniques of observation, document inspection, and sampling. 

Lastly, just as in SOx, MCP testing must be 

clearly documented and describe what key 

controls were tested, the methods used, any 

deficiencies detected, and what corrective 

actions were taken.

Perhaps the most noteworthy difference between SOx 404 and the Army’s 

MCP is related to scoping. Within the 

Army, the Management control process is 

fairly standardized. Though annual direction and guidance is provided and different programs are substituted for review 

on a cyclical basis, the process is relatively 

straightforward and slow to change. This 

contrasts sharply with the dynamic and 

proactive nature of businesses. More and 

more, companies like GE are constantly 

pushing to expand into new markets and 

developing innovative technologies and 

practices—all aimed at obtaining competitive advantage. Understanding the intricacies of accounting principles and their 

application to such global evolution is a 

critical component of SOx reporting and 

an important ongoing challenge. 

As stated at the outset of this article, 

SOx is a terrific example of the practical application of the theories behind 

the principal-agent relationship. 

Notwithstanding any of the challenges 

regarding its implementation or the burdens it may add to businesses, the true 

benefit of SOx is that it will continue to 

enable a company’s management, public 

investors, and others to rely on the information reported in financial statements to 

make sound investment decisions. 

About the Author:

“Major Andrew Hyatt is one of five 

Functional Area 45 officers currently participating in the Training With Industry 

program, in his case with General Electric.”

10 Ibid.
14 4th Quarter 2007

If you have ever been approached by 

someone in the staff to talk about your 

Manager’s Internal Controls Program, 

or to discuss the use of Lean Six Sigma 

within your organization, you probably 

had a similar reaction to both. You were 

probably filled with a deep desire to run 

as fast as you could or find an effective 

way to change the subject. Not unlike the 

feeling most people get when an auditor 

walks through the door stating “we are 

here to help”.

However, in all three instances effective use of the Manager’s Internal Control 

Program, Lean Six Sigma and auditor 

resources can, and in fact will help managers, supervisors, and leaders improve organizational processes, reduce risk, improve 

quality, efficiencies, and effective use of 

resources, not to mention compliance with 

laws and regulations.

Forgetting for a moment that Internal 

Controls and its associated reporting 

requirements are mandated by the Federal 

Managers’ Financial Integrity Act, internal controls over our business processes 

help us ensure that specific outcomes are 

derived based on adherence to specific 

guidelines established by the organization, 

laws and/or regulations.

 Periodic reviews and testing of established internal controls help to identify 

weaknesses or necessary changes of internal controls needed as a result of changes 

in laws, regulations, automation technology, organizational mission, strategic 

objectives, and other changes in the operating environment.

An effective Internal Control program 

does for an organization what preventive 

maintenance does for your automobile. 

It ensures optimum performance and the 

avoidance of potentially large and costly 

problems due to lack of proper care and 

oversight.

So, what do management controls and Lean Six Sigma have 

in common?

“The root of both “Lean” and “Six 

Sigma” reach back to the time when the 

greatest pressure for quality and speed 

were on manufacturing. “Lean” rose as a 

method for optimizing automotive manufacturing, while “Six Sigma” evolved as 

a quality initiative to eliminate defects 

by reducing variation in processes in the 

semiconductor industry. It is not surprising that the earliest adopters of Lean Six 

Sigma arose in the service support functions of manufacturing organizations 

like GE Capital, Caterpillar Finance, and 

Lockheed Martin.”1

In the services industry, Lean Six Sigma 

is a business improvement methodology 

that maximizes results by achieving the 

fastest rate of improvement in customer 

satisfaction, cost, quality, process speed, 

and invested capital.

Both the Managers’ Internal Control 

Program and Lean Six Sigma use similar 

techniques to define the process; identify 

1

 Army Business Transformation Knowledge Center: 

Transformation Focus - Continuous Process Improvement 

(CPI) - Lean Six Sigma article.

Manager’s Internal Controls 

and Lean Six Sigma

By Jorge Roca

What do these two terms have in common? How can either 

one help improve the way we conduct our business and 

manage organizational requirements?
4th Quarter 2007 15

risks; develop solutions and controls; test 

and measure results. 

Because of the similarities in process improvement analysis and Lean Six 

Sigma’s ability to isolate and focus on 

specific projects to expedite identification of process improvements needed 

to achieve efficiency and effectiveness, 

The Office of the Assistant Secretary of 

the Army (Financial Management and 

Comptroller) (ASA (FM&C)) decided to 

use Lean Six Sigma to help identify any 

and all potential redundancies, delays, 

dead ends, and indirect paths within the 

process to implement United States Army 

Audit Agency (USAAA) audit recommendations. The USAAA has identified 47 

unimplemented audit recommendations 

with potential monetary benefit that will 

be tracked for resolution by the Army’s 

Senior Leader Steering Group (SLSG) / 

Senior Assessment Team (SAT). 

The ASA (FM&C) Lean Six Sigma 

Project is described below:

Problem: The Army Audit Agency (AAA) 

has identified 47 recommendations with 

monetary benefits of about $983 million 

that are unimplemented. ASA (FM&C) 

has one unimplemented recommendation 

with a potential monetary benefit of about 

$41 million. AAA reported that the Army 

was not using a complete set of metrics to 

accurately measure overall use of Defense 

Travel System (DTS). During the audit, 

AAA calculated the DTS usage rate for the 

period July through December 2005 was 

only about 7 percent based on the use of 

the reservation module. By establishing 

a complete set of metrics used to track 

and enforce full DTS usage, the Army will 

be able to identify commands that either 

aren’t using or aren’t fully using DTS, and 

take corrective action so that the Army 

achieves its goal of 75-percent full DTS 

usage. By achieving the 75-percent goal, 

the Army will save an estimated $41 million in transaction fees with the 6- year 

period beginning in FY 07, assuming use 

of a $7 Touch less rate and a DTS usage 

rate for the reservation module of 50 percent for FY 07 and 75 percent thereafter. 

ASA (FM&C) agreed with the report findings and monetary benefits.

Scope: The DTS services all Army personnel. This project will review actions taken 

to implement AAA recommendations.

Goal: Increase use of the DTS reservation 

modules by 50 percent for FY 08 and 75 

percent thereafter. The cost savings projected in the AAA audit report suggested a 

cost savings of about $41 million. 

The use of Lean Six Sigma in combination with a viable Manager’s Internal 

Controls Program will undoubtedly yield 

positive results in the effectiveness and 

efficiencies of your organization.

About the author:

Mr. Jorge F. Roca is the Director for the 

Management Services Directorate, Office of 

the Deputy Assistant Secretary of the Army 

(Financial Operations)
16 4th Quarter 2007

R ES OURC E MA N A G E M EN T

At some point in their careers, most 

workers raise questions about the 

work they do, asking themselves 

if they’re working on the most important 

tasks and if they’re performing those tasks 

as effectively and efficiently as possible. 

These concerns are often captured in questions such as these:

• Who is the customer for our work? 

Are we sure we’re doing what the customer wants us to do?

• How do we measure the quality of 

our work?

• In the processes we use, does every 

step in the process make a positive 

contribution to the final product, or 

are there non-value added steps that 

can be eliminated?

• For tasks that depend primarily on 

labor, are we using the best combination of military personnel, civilian 

employees, and contractors?

• Are we making the best possible use 

of automated tools in order to produce higher quality outputs with less 

effort? Can we apply automation to 

our work in ways that will improve 

our efficiency and effectiveness?

• Is some of our work duplicative and 

redundant? Are we working on separate tasks whose outputs are virtually 

identical?

To help workers and managers address 

these and similar questions, the Army is 

using the process improvement methodology known as Lean Six Sigma (LSS). As 

the name suggests, Lean Six Sigma is a 

combination of two sets of tools, Lean and 

Six Sigma. Lean focuses on streamlining 

processes to make them more effective and 

efficient, while Six Sigma focuses on ensuring that repetitive processes are performed 

at a consistent level of quality. LSS is the 

centerpiece of the Army’s major effort to 

transform its business processes in order 

to reduce costs and provide better support 

to the warfighter.

Army resource managers play two key 

roles in LSS. One of these roles is to support colleagues in other functional areas 

who are working on LSS projects by providing advice, guidance, and assistance 

on the financial management aspects of 

their projects. This role, which includes 

the important task of developing cost 

estimates for LSS projects, was discussed 

in the 3rd Quarter 2007 issue of Resource 

Management.

The other role for resource managers 

is to use the LSS methodology as a means 

of transforming their own business processes. Resource managers are the owners 

of numerous business processes, many of 

which clearly present opportunities for 

improvement; this is what some people 

might call a “target-rich environment.” 

Resource managers should be actively 

engaged in identifying those improvement 

opportunities and in implementing ways 

to perform their processes better, faster, 

and cheaper.

At Army Headquarters, the Office 

of the Assistant Secretary of the Army 

(Financial Management and Comptroller) 

(OASA(FM&C)) has eagerly accepted this 

role and now has more than 20 projects 

completed or underway. In this article we 

will highlight a few of the completed projects and discuss the factors that have made 

the FM&C program successful. 1

Implementing Wide Area 

Workflow (WAWF)

Each year the Army pays the Defense 

Finance and Accounting Service (DFAS) 

tens of millions of dollars to process 

payments to contractors. In the past 

these payments were handled as manual 

transactions, each of which required a 

considerable amount of hands-on processing at DFAS. WAWF, or Wide Area 

Workflow, is a system that automates most 

of the steps in the process, to include the 

contractor’s submission of the invoice, 

the government’s submission of the 

receiving report, and DFAS’s processing and payment. In spite of the obvious 

benefits, WAWF was being used for less 

than 15% of contractor payment transac1

 For more information about the projects discussed in this 

article, or for questions about the financial management 

aspects of the LSS program, send e-mail to BTFinancial@

hqda.army.mil. 

Transforming Financial Management 

at Army Headquarters

By Joseph Romito

Transforming Financial Management 
4th Quarter 2007 17

tions. Recognizing the unused potential 

of WAWF, the Deputy ASA for Financial 

Operations initiated a LSS project to investigate whether WAWF implementation 

could be accelerated.

Using LSS analytical tools, the project 

leader was able to show that increased use 

of WAWF throughout the Army would 

result in simplified processing for government personnel and contractors, more 

rapid payment to contractors, and, most 

significantly, a reduction in the Army’s 

annual bill to DFAS. With an accelerated 

timeline that calls for WAWF to be used 

for 75% of eligible transactions this fiscal 

year and 100% by FY09, the projected cost 

reduction is $69 million per year.

Reducing Budget Exhibit 

Requirements

Twice each year – once for the Budget 

Estimate Submission (BES) in AugustSeptember and again for the President’s 

Budget (PB) in December-January – the 

Army Budget Office (ABO) must submit 

thousands of pages of budget exhibits 

to the Office of the Secretary of Defense 

(OSD) Comptroller. While most of 

these exhibits serve a useful purpose, 

some appear to be prime candidates for 

streamlining in one way or another, either 

because they are duplicative with other 

exhibits, are no longer used in the budget 

review process, or could be automated.

The military departments frequently 

question the need for various exhibits and 

in recent years have achieved some success 

in reducing the number of required exhibits. In 2007 the Director of Operations and 

Support in ABO initiated a LSS project to 

address this issue. Rather than approach 

the problem from its own perspective as 

the submitter of budget exhibits, the project 

team applied a LSS technique called “voice 

of the customer” (VOC). Viewed from 

the perspective of the customer – in this 

case the OSD Comptroller, the Office of 

Management and Budget, and the Congress 

– a VOC analysis attempts to identify what 

the customer really needs and thus helps to 

identify work that is non-value added from 

the customer’s perspective.

This customer-based analysis generated 

a receptive audience at OSD, and the project team was successful in having a number of budget exhibits eliminated, with a 

corresponding reduction in the amount of 

staff overtime that will be required to prepare the exhibits.

Cost Analysis Requirements 

Description (CARD): 

Standardizing the Process and 

Reducing Cycle Time

The Cost Analysis Requirements 

Description (CARD) is a document prepared for Major Defense Acquisition 

Programs (MDAP). It provides a quantitative and narrative description of the technical, physical, and performance features 

of the weapon system, and is intended to 

enable analysts to develop a cost estimate 

of the acquisition program. The CARD 

is required throughout DoD; across all 

services and Defense agencies, nearly 90 

MDAPs require a CARD. The Program 

Managers (PMs) for major weapon systems have the primary responsibility for 

preparing CARDs.

In a LSS project which he co-led with 

the Office of the Assistant Secretary of 

the Army (Acquisition, Logistics, and 

Technology), the Deputy ASA for Cost and 

Economics determined that the lack of a 

standardized process and timeline for preparing a CARD made it difficult for PMs to 

submit the proper documentation on time 

to support the acquisition process. The project team established a structured process for 

CARD development that will have rigorous 

input controls, ensure consistent application 

of rules governing the content of the CARD, 

and ensure on-time delivery to support 

milestones in the acquisition process.

The new process is projected to reduce 

the cycle time and cost to prepare each 

CARD by 30% and to improve the overall 

quality of the finished product. When fully 

implemented throughout the Army PM 

community the annual cost reduction will 

be more than $1 million per year; further 

cost reductions may be achieved if the 

Navy and Air Force adopt the new process.

Standardizing Processes for the 

Army Purchase Card

The Deputy ASA for Financial 

Operations conducted a study of the Army 

purchase card and identified opportunities 

to improve the procedures for handling 

“micro” purchases, i.e., purchases less than 

$2500. The purchase card automates transactions and thus reduces the cost of transaction processing. The large number of 

charges for manual transactions suggested 

the purchase card was under-utilized. The 

Deputy ASA recognized that a LSS project 

could streamline the process, make it more 

user-friendly, increase utilization of the 

purchase card, and result in meaningful 

cost reductions.

The LSS team approached the project by conducting a detailed mapping of 

the purchase card process as used at one 

installation (Ft. Leavenworth, Kansas) to 

identify problems with the process and to 

develop the required improvement actions. 

The LSS team found that the card was 

being used almost 100% of the time and 

that the manual transaction charges at Ft. 

Leavenworth were due to system rework 

and the establishment of accounting codes 

for the new fiscal year. The lessons learned 

from Ft. Leavenworth will be evaluated 

to determine how extensively they can be 

applied to installations Army-wide. The 

expectation is that a significant number of 

the Army’s 181 installations will be able to 

apply the findings and to generate benefits 

in the form of reduced cost to the Army 

for manual transaction charges.

The purchase card automates transactions and 

thus reduces the cost of transaction processing.
18 4th Quarter 2007

R ES OURC E MA N A G E M EN T

Reducing Cycle Time for 

OPTEMPO Cost Analysis

The Deputy ASA for Cost and 

Economics (DASA-CE) established the 

Performance Metrics Warehouse (PMW) to 

serve as an analytically-based decision-making and reporting tool to support numerous 

Army programs and activities. One of the 

key activities supported by PMW is the 

analysis of operating tempo (OPTEMPO) 

costs for the warfighting Army. To support 

managers at HQDA and subordinate commands, DASA-CE collects, analyzes, and 

reports OPTEMPO execution data on a 

monthly basis, providing data down to the 

level of individual brigade combat teams. 

To do this work, the DASA-CE staff is 

assisted by a supporting contractor.

The process owner used LSS process 

mapping techniques to conduct a detailed 

assessment of the process for collecting and 

analyzing the OPTEMPO data. The assessment indicated that the process was working effectively but was not as efficient as it 

could be because some of the steps within 

the process were no longer needed. The 

analysis also showed that if the non-value 

added steps were eliminated from the process, the remaining work could be restructured so that it could be performed by 

in-house personnel and that the supporting 

contract would no longer be needed.

The recommendation to restructure the 

work and cancel the supporting contract 

was approved, and the net result of the 

project is that OPTEMPO data will continue to be provided to PMW with no loss 

of accuracy or timeliness but with a cost 

reduction of $150 thousand per year.

Conclusion and Lessons Learned

The preceding pages have highlighted 

some of the dozen LSS projects that OASA 

(FM&C) teams completed in 2007. The 

experience the organization has gained 

with these projects and with others that are 

underway has led to several conclusions:

• Top-Down Support. As with any 

major initiative, successful implementation of Lean Six Sigma requires 

top-down support from the senior 

executives in the organization. LTG 

David Melcher, the Military Deputy 

for Budget in OASA(FM&C), has 

expressed his strong support for 

the LSS program: “We have lots of 

untapped ideas on how to do business 

better, improve our processes, and 

develop efficiencies that will benefit 

our people and those we interact 

with. Having invested several hours 

in LSS training and having actively 

participated in two of our completed 

projects, I am convinced that LSS 

gives us a great set of tools we can use 

to transform our business processes. I 

actively support the LSS program and 

know that everyone in FM&C will do 

the same for all the right reasons.”

• Role of the Project Sponsor. In LSS 

parlance, the project sponsor is the 

first person in the chain of command 

who has functional responsibility for 

the process under consideration. With 

support from senior executives, and by 

being proactive in identifying projects 

and guiding project teams, project 

sponsors within an organization are 

the key individuals who can ensure the 

success of the LSS program.

• Supporting Infrastructure. LSS tools 

and techniques are analytically rigorous and cannot be used to full effect 

by untrained individuals. The Army 

conducts formal training for Soldiers 

and civilians who are selected to lead 

project teams, and this training is a 

critical success factor. In addition, each 

organization deploying LSS needs a 

cadre of certified experts in the LSS 

methodology who can help guide the 

overall program; assist project teams in 

dealing with difficult issues; and help 

identify high-level, enterprise-wide 

projects. Dr. Katherine Thompson, 

who as the LSS Deployment Director 

is responsible for the program within 

OASA(FM&C), recognized this at 

an early stage. Dr. Thompson commented, “When we first began to 

implement Lean Six Sigma, I knew 

we would need outside help, at least 

initially until we developed our own 

in-house expertise. Initially bringing 

in contract support and growing our 

internal team enabled us to get off to 

a running start and helped us evolve 

the LSS process so that it supports our 

organizational objectives.”

• Validity of the LSS Tools. If properly 

used by the project team under the 

guidance of an individual trained in 

LSS procedures, the LSS analytical 

tools will lead to sound conclusions 

that have support from all participants. 

As a member of one project team 

said, “Because I was a subject matter 

expert in one aspect of our project, I 

immediately knew the solution to that 

part of the problem. Unfortunately, 

the other members of the team didn’t 

see things the way I did. But after just 

a few hours of using the analytical 

tools the other team members arrived 

at the same conclusion I had reached. 

This was a worthwhile process because 

we reached the right solution and, 

perhaps more importantly, got greater 

buy-in than if we had tried to convince 

the others to accept my opinion as the 

subject matter expert.”

In summary, senior leaders in 

OASA(FM&C) have made a commitment 

to the Lean Six Sigma program because it 

has proven to be a valuable tool in making resource management processes more 

effective and efficient and thus contributing to the program’s overall objective 

of providing improved support to the 

warfighter at reduced cost. The program 

is yielding positive results after just a year 

of implementation, and indications are 

that continued implementation will lead to 

even greater success in the future. 

About the Author:

Mr. Joseph Romito, a senior research fellow 

at LMI Government Consulting in McLean, 

Virginia, assists OASA (FM&C) on a wide 

range of projects. Mr. Romito is a former 

career Army officer whose final active duty 

assignment was as a division chief in the 

Army Budget Office at HQDA.
4th Quarter 2007 19

There are 4 primary generations 

in the workforce today.

Traditionalist/Veterans (1925-1945). 

They experienced two wars and the Great 

Depression. They are very loyal to their 

organization. They believe in the value 

of work and have definite views about 

respecting authority.

Baby Boomers (1946-1964). 

They grew up in a time of 

prosperity, change and expansion. They grew up with a 

strong sense of security due to 

the economic expansion of 

their time. Less concerned 

about career issues and 

more concerned about 

family and security in the 

future. 

Generation X or “Xers” 

(1965-1977). This was the 

age of the latchkey kid, due 

to the necessity of two income 

families. Women were joining 

the workforce in dramatically 

increasing numbers. They do not 

think much of structured work 

hours, and their approach to 

authority is casual. They are very 

technologically savvy and more 

willing to change jobs.

Generation Y or “Nexters” 

(born after 1977). The first generation to 

be born into homes with computers. They 

are perceived as wanting to make a difference and knowing that their work has 

value. They are uncomfortable with hierarchies and rigid structures. They consider 

change to be a way of life.

Organizations today are struggling with 

the challenges of managing a more diverse 

workforce. Variation in goals and perspectives due to generalization differences 

plays a factor in these challenges. This is 

further complicated because of the age difference between managers and employees. 

People of varying ages may have different 

goals and perspectives. Older employees 

are interested in retirement, salaries and 

bonuses, investment plans and medical 

coverage while younger employees are 

more interested in career development and 

Multi-generational Workforce

By Lindsey McDonald

Managers today are faced with the challenge of bringing 

together people from four generations to meet the goals of 

their organization. Government department agencies are 

challenged with recruiting and retaining a flexible, agile, 

skilled workforce to meet their domestic and global needs. 

Organizations must create a work environment that includes 

and supports the different styles that reflect the current 

multigenerational workforce if they wish to be successful. 
20 4th Quarter 2007

R ES OURC E MA N A G E M EN T

gaining more educational qualifications. 

Manager’s responsibilities are to understand and value the differences among the 

generations. Some of the most common 

differences between the generations are attitudes, commitments, loyalties, and change. 

A common complaint Baby Boomers 

make toward Xers and Nexters are “they 

don’t have the same work ethic!” This is 

true. This means they place a different 

priority and value on their work. Xers and 

Nexters work to obtain other more important priorities while Baby Boomers work 

to work. Each generation needs motivated 

in a different way. Boomers want titles and 

authority to motivate them. They like to 

participate in conventions that keep them 

professionally connected. They like compensation that is long term such as profit 

sharing. Xers need to be provided with 

flexibility so they can manage their priorities. They like opportunities for teamwork 

so they can “fuel their fire”. Nexters want 

flexibility in where and when work is 

done. They are very interested in challenge 

and change. Boomers have always been 

seen as loyal to their companies. They 

feel a sense of belonging and dedication 

based on their history. This is not so true 

for Xers and Nexters. They are focused 

on present and future. They can be very 

committed to their work, although not a 

particular job. When if comes to change 

Boomers want control. They resist having 

others they don’t respect force change on 

them. Xers are wary of change, but adaptable. Nexters consider change to be a way 

of life and they demand it.

Each generation brings to the table different approaches to their work from how 

they view business strategies to the way 

they prefer to interact with people. It takes 

perceptive leaders to juggle the competing 

demands of this diverse workforce while 

keeping them motivated and focused. 

When managed effectively, a multigenerational team can add tremendous value to 

your organization. Most managers have 

probably realized that adopting a single 

leadership style is ineffective. Each generation maintains its own view of authority 

and has its own expectations of management. Matures are comfortable overall 

with a hierarchical structure while younger 

generations demand a more participative 

management style. Younger generations 

want to be involved in the decision-making 

process and understand the “why” of their 

tasks/assignments. Other generations may 

mistake this eagerness for disrespect. In 

order to better manage this diverse workforce it is important to remember to ensure 

open communication, respect the different values held by different age groups, 

encourage generational partnerships and 

collaborations, remain flexible and provide 

employees with opportunities to introduce new ideas and be open to them. The 

diversity of four generations provides a 

unique opportunity for knowledge sharing. 

You may need to make an intense effort to 

facilitate collaboration since employees in 

the various age groups may not naturally 

interact with each other on a daily basis. 

The Resource Management Mentorship 

Program would be an excellent way to successfully achieve this interaction. Pairing 

tenured professionals with less experienced employees can help each generation 

develop a better understanding of each 

other and the unique qualities they bring 

to the department. 

Managers must stress to their organization the importance of maintaining an 

open mind and welcoming different ideas 

and strategies to help minimize the potential for conflict such as senior employees 

wanting to establish formal documentation for their processes and junior 

employees wanting to speed the process 

along. Because generational conflicts in 

the workplace are based on differences in 

views, mindsets, demographics, values and 

ambitions each generation is motivated 

by different messages in the workplace. 

Blending the creative distinctive energies 

and accommodating the different working styles of these generations will create 

a dynamic team. Helping employees from 

opposite generations develop skills that 

enable them to appreciate their differences 

will greatly enhance production, quality of performance and job satisfaction. 

The Boomer generation often focuses 

on process and the importance of inclusion, which often means frequent meetings. Xers may prefer a specific job with 

concrete goals and the opportunity to 

complete the task. Xers have identified an 

unyielding interest in balancing work and 

personal life. They often have been viewed 

as being unmotivated, self-centered, outspoken and job hoppers.

As Americans work longer, it is important for leaders to understand the significance of managing a multigenerational 

workforce. Each generation brings diverse 

perspectives, values, needs and expectations to the workplace. The end result is 

a greater variety of opinion, creativity, 

and talent. The fact that there are differences in the generations is nothing new 

but the magnitude is. A multigenerational 

workforce can provide many benefits to 

your organization if you maximize the 

assets each group has to offer. It is time to 

understand and value this diversity so we 

can benefit from it today.

About the Author

Ms. Lindsey McDonald is a Financial 

Management Analyst Intern for G-8, 

Resource Management at Redstone Arsenal.

As Americans work longer, it is important for 

leaders to understand the significance of managing 

a multigenerational workforce.
4th Quarter 2007 21

T he Army Management Staff College 

(AMSC) witnessed many changes 

is fiscal year 2007. One could say 

it was “out” with the old legacy courses 

and “in” with the Civilian Education 

System (CES). The launch of the Senior 

Civilian Leader Continuing Education 

Program (CESL) pilot course debuted 

September 10, 2007 at the Fort Belvoir, VA 

campus. The course was renamed after 

the September class and the new course 

title is Continuing Education for Senior 

Leaders (CESL). A total of 36 students – 

both civilian and military graduated from 

the 4.5 day course on September 14, 2007. 

There is a need for the Army to have current and relevant education at the senior 

organizational and strategic levels. Very 

few Army civilians are selected and attend 

Senior Service College (SSC) which created a gap in CES between completion 

of the Advance Course and attendance 

at SSC. CESL is a sustainment program 

designed to bridge this gap. The program 

is designed around eight core themes 

which continually updated to ensure 

relevancy to Army current and future 

missions. The “dynamic” aspects of the 

program makes it a viable long term 

opportunity for Army Civilians to attend 

several times in their careers after the 

Advance Course. 

The course got off to a magnificent start 

on the first day. LTG Michael D. Rochelle, 

Deputy Chief of Staff, G-1, was the 

keynote speaker. The topic of his address 

was “in extremis” leadership. During times 

of chaos and ambiguity leaders must focus 

on the macro issue and not get lost in the 

details. All in attendance were captivated 

with his presentation and the real world 

examples he used were particularly 

noteworthy. He cited the example of 

former New York City Mayor Rudy 

Giuliani and his response during the 9/11 

attacks. Mayor Giuliani is a lawyer by trade 

but the point LTG Rochelle emphasized 

is that Mayor Giuliani focused on how to 

rebuild the city – to include taking care 

of everyone involved with the destruction 

of the towers. Another example he cited 

was the immediate aftermath of hurricane 

Katrina. The city was in a panic until 

LTG Russell Honore arrived on the scene. 

LTG Honore demonstrated “in extremis” 

leadership by focusing on providing 

stability and security to the city. LTG 

Honore’s leadership served as a clear 

example of how a leader did not get lost in 

the details but focused on the major issues 

during a crisis situation. 

A commander’s panel of senior 

commissioned and non commissioned 

officers convened later in the morning 

after LTG Rochelle’s speech. The panel 

consisted of former battalion and battery 

commanders and brigade, battalion 

Command Sergeants Major and a battery 

First Sergeant. These individuals recently 

returned from theater – Afghanistan and 

Iraq within the past year. Panel members 

responded to questions submitted by the 

students. Needless to say, due to time 

constraints the panel only answered 

six questions. However, the students 

were able to hear a boots on the ground 

perspective from soldiers serving in key 

leadership positions while in combat 

operations. The students were broken 

out into seminar groups and would 

meet together during the afternoons. 

Capitalizing on in house expertise, AMSC 

faculty served as facilitators for the 

seminar groups. 

Continuing Education 

for Senior Leaders

By Lieutenant Colonel Brent Penny
22 4th Quarter 2007

R ES OURC E MA N A G E M EN T

Each morning the students would gather 

together, en mass, to receive presentations 

centered on one of the eight themes:

1. Challenge of Transition within the 

Army – Current and Future Complex 

National Security Challenges

2. Dynamics of Transition Leadership 

to the Senior Level

3. Transformational Improvement of 

Process and Teams

4. Personnel Management Challenges 

and Strategies

5. Strategic Innovations: Creating Agile 

and Resilient Organizations

6. Knowledge Management

7. Moral Development/Ethical 

Dilemmas

8. Building Individual and 

Organizational Awareness of Well 

Being and Cultural Diversity 

The presenters and guest speakers 

were subject matter experts from AMSC, 

Academia, Industry, Contractor, and DoD 

agencies. The presentations were highly 

interactive and fostered a participatory 

environment where discourse on the theme 

and current problems in the field was 

discussed by the students and the selected 

presenters from the Army and other 

organizations. For example, several students 

engaged in insightful discussions with the 

subject matter expert who provided the 

presentation on Middle Eastern Culture/

Islamic Ideologies. One student asked a 

question about comparing and contrasting 

Muslims from various regions of the 

world. Another student sought greater 

understanding on how to bring about 

better relationships between non Muslim 

Americans and Muslim Americans.

Each afternoon while in their respective 

seminar groups the students were 

responsible for completing a top 10 book 

list, identifying management challenges 

within their organizations and identifying 

civilian issues. The identification of the 

civilian issues served as the culminating 

event because the students had the 

responsibility for briefing a panel of Senior 

Executive Service (SES) officials. The 

intent was to secure SES buy-in to move 

the issue(s) forward to Army Command 

(ACOM) or HQDA level to bring about 

resolution of the issue. The students put 

forth three issues to the SES panel and 

based on the scope of the issues the SES 

panel opined the issues were not of the 

magnitude to put forward to the ACOM 

or HQDA level. 

In summary, CESL provided Army 

civilian and military leaders with the 

opportunity to experience and engage 

in dialogue of the contemporary and 

ongoing issues within the Army such as 

transformation and resetting the force. 

Students were afforded the opportunity to 

integrate innovative strategic leadership 

perspectives and dynamics through peer 

learning, collaboration, and networking.

About the Author

LTC Brent Penny is a FA45 officer currently 

assigned as a Professor, Civilian Education 

System (CES) at the Army Management 

Staff College (AMSC). Prior to this assignment he was in a NATO billet as the Chief, 

Operations and Internal Review Branch, 

Allied Joint Force Command Headquarters, 

Naples Italy.

T he new era of government travel for 

DoD personnel is here! If you travel 

frequently, or will be traveling, you 

probably already know or have at least 

heard about the Defense Travel System 

(DTS). For those of you who have not yet 

used DTS, it is the mandatory government 

web based travel system that enables users 

to create orders, book travel reservations, 

and process travel vouchers. A primary 

benefit of the system is that it expedites 

reimbursement to the traveler and the 

traveler’s government travel card. 

DTS was implemented at 

Communications-Electronics Life Cycle 

Management Command (CECOM 

LCMC) and the Command, Control, 

Communications, Computers, Intelligence, 

Surveillance, and Reconnaissance (C4ISR) 

partners for Fort Monmouth, New 

Jersey on September 17, 2004. CECOM 

LCMC consists of the Communications 

and Electronics Command (CECOM), 

Program Executive Office for Command, 

Control, Communications Tactical (PEO 

C3T), and Program Executive Office 

for Intelligence, Electronic Warfare and 

Sensors (PEO IEW&S). The C4ISR partners include Program Executive Office 

for Enterprise Information Systems (PEO 

EIS) and the Communications-Electronics 

Research, Development and Engineering 

Center (CERDEC). 

With the advent of DTS, a significant 

number of CECOM LCMC administrators 

and traveler’s required assistance navigating through DTS. The Deputy Chief of 

Staff for Resource Management (DCSRM) 

queried the Ft. Monmouth community 

and found there were fifty-two common 

issues. The fifty-two issues were summarized into four categories. The categories 

are: (1) Contractor Travel Office (CTO) 

processes requiring improvement, (2) DTS 

required enhancements, (3) problems that 

Dive into the DTS Splash Page

By: Charles J Morse
4th Quarter 2007 23

could be mitigated by means of improved 

communication, and (4) non use of DTS 

causing non-compliance to regulations. 

The end result revealed that a single source 

of information regarding DTS and travel 

policy was urgently needed. As a result, 

Colonel Kent T. Woods, the Chief of Staff 

of CECOM LCMC directed DCSRM to 

create a user friendly website containing 

all DTS and TDY related information.

The Deputy Chief of Staff for Resource 

Management developed the DTS Splash 

Page to provide travelers with a single 

source for all travel information. They 

included web links to outside resources 

not found in DTS. If you ever find yourself 

asking questions such as “How do I register 

for DTS?” to “What receipts are required 

on a DTS Voucher?” you should consider 

viewing this website. This user friendly 

website is easily located on the main page 

of the Team C4ISR Knowledge Center 

under featured services (https://www.

kc.us.army.mil/homekc.nsf/fsKCPortal). 

It is also viewable from anywhere in the 

world where there is internet access. This 

is an incredible characteristic to have, as 

travelers can turn to the Splash Page for aid 

while they are on temporary duty (TDY). 

Although membership to the Knowledge 

Center (KC) is required for access, travelers 

from other DoD activities outside CECOM 

LCMC may be able to sign in as a “guest,” 

as long as they are registered with Army 

Knowledge Online (AKO). 

In February of 2006, DCSRM created a 

team that worked with the Deputy Chief 

of Staff for Operations (DCSOPS) to 

develop the Splash Page. 

The team consisted of 

Ms. Kelly Dempster, 

Ms. Catherine 

Sanderson, and Mr. 

Joseph Billups who 

researched and determined what information was needed to 

be included on the 

Splash Page. Renee 

Ullman of DCSOPS, 

along with KC programmers, created 

the shell of the website. Once 

the shell was created, Ms. Dempster, Ms. 

Sanderson, and Mr. Billups worked on 

loading documents and web links into 

the Splash Page. Finally on April 11, 2006 

the DTS Splash Page was launched on the 

Team C4ISR Knowledge Center. 

The purpose of the DTS Splash Page 

is to provide a single source for travel 

information, although, there are links 

for outside sources. The information 

in the Splash Page is organized under 

seven categories. These categories are: 

(1) Points of Contact, (2) Available 

Training, (3) Important Forms, (4) Hot 

Topics, (5) Regulations, (6) Related 

Travel Information, and (7) ODTA/

FDTA/DMM (Organizational Defense 

Travel Administrators/Financial Defense 

Travel Administrators/Debt Management 

Monitors). Under each category are links 

you can click on that will give 

you the information you are 

looking for. In addition to giving us all these important categories, there are also links for 

frequently asked questions, a 

travel advisory website, and a 

link for the DTS home page! 

This allows you to toggle 

back and forth between DTS 

and the Splash Page. 

The first section of the 

Splash Page is Points of 

Contact. This section is 

great, because if you ever 

need to talk directly to a 

point of contact (POC), 

you can find out who is best for you to 

contact. For instance, the phone numbers for Carlson Wagonlit are posted in 

case you need to contact them. You can 

also find who to contact for help for your 

Bank of America travel card. This person is known as your Agency Program 

Coordinator (APC). If you do not know 

who your Agency Program Coordinator 

is, you can find out, because there is a 

link that lists each organization and their 

APC on the Splash Page. You would want 

to contact your APC for issues related to 

credit limit increases, reactivation, or deactivation of the travel card, as well as many 

other credit card related issues.

The most valuable information in this 

topic are the contacts for ODTAs and 

FDTAs. Once more, each organization 

is listed with its point of contact. Using 

the Points of Contact section also gives 

you a faster way to get a phone number 

or e-mail address for your organization’s 

ODTA POC. The ODTA is who you 

would contact for registering for DTS or 

if you had any problems in DTS. The list 

of contacts also makes it more convenient 

to identify which FDTA you need to talk 

with, in order to figure out what line of 

accounting is necessary to use. 

The second section listed on the Splash 

Page is Available Training, and it is 

extremely beneficial. There are links that 

demonstrate how to do everything you 

need in DTS. It starts off with a link that 
24 4th Quarter 2007

R ES OURC E MA N A G E M EN T

shows you how to register for DTS. It also 

gives step-by-step instructions on how to 

take the Certifying Officers Legislation 

(COL) training for new Approving 

Officials. Yet, the finest thing about this 

section is a link that allows you to watch 

several DTS demonstrations with audio. 

Each demonstration has a video control 

bar that lets you play, rewind, forward, or 

stop the demo so that you can follow along 

at your own pace. 

In addition to this section, there is a 

link for the bi-monthly newsletter, “Travel 

Tutor,” that the DTS Project Manager 

Office (PMO) sends out. The newsletters 

are a great read and include important 

updates on travel issues. You can also find 

the latest changes to travel regulations and 

travel tips.

The next two categories are Important 

Forms and Hot topics. Important Forms 

contains exactly what the title implies. 

Here you can find an application for the 

Bank of America travel card. Of course, 

along with the application there is the 

Statement of Understanding form. If 

an organization has a new Approving 

Official, they must complete a DD 577 

Card. This card delegates authority to the 

Approving Official. You can easily find 

this form in this section. Lastly, you can 

find the form to gain access to EAGLS. 

EAGLS is the Bank of America website 

that lets you manage your government 

travel card online.

In Hot Topics you can quickly find 

important information on current changes 

that travelers need to be aware of. In this 

section, you can look up limo rates from 

your residence to the airport. From time 

to time, a traveler will deviate from the 

standard mode of travel within DTS. For 

example, a traveler may be required to go 

to Chicago from New Jersey. The standard 

mode of travel would be air. However, the 

traveler may elect to drive out to Chicago. 

When this happens, the traveler may be 

required to fill out a Constructed Travel 

Worksheet (CTW) for the difference in 

cost. Yet, each base has different standards 

for the mileage required to fill out a CTW. 

You can find out when Fort Monmouth 

requires you to fill out a CTW under the 

Hot Topics section. Among many other 

things, you can also look up what the traveler cancellation procedures are. 

For travelers requiring the actual rules 

of traveling, the DTS Splash Page provides 

us with a category where we can find all 

the information we need related to the 

topic. This topic is the Regulations category. If you would like to see what regulations mandate a rule, you can find it here.

The next section is called Related 

Travel information. This is an extremely 

valuable section because you can look up 

the airport code while you are creating 

your orders. It is particularly useful if you 

are flying to an airport or city you have 

not previously visited. In addition to this, 

there is a link here that lets you look up 

the most current mileage rates with just 

one click. Another advantageous feature 

in this section of the Splash Page is the 

ability to see the availability of flights, 

rooms, rental cars, and anything else you 

need to reserve. In DTS you can not see 

what is available unless you start creating an order. The Splash 

Page lets you see what is 

available before starting 

anything. It is a fantastic 

planning tool. 

Finally, the last section 

is the ODTA/FDTA/

DMM. This category 

includes technical information for all ODTA/

FDTA/and DMMs. 

Some topics include 

instructions for authorizations that crossover to another fiscal 

year. The FDTAs can find a printout that 

guides them through the process of rolling over lines of accounting to a new fiscal 

year. This section has many other links 

that ODTAs, FDTAs, and DMMs will find 

useful in carrying out their responsibilities.

A valuable link included is the US 

Department of State Travel Advisory. 

Travel Warnings are issued when the State 

Department recommends that Americans 

avoid a certain country. 

The DTS Splash Page is not just for 

travelers. It was developed to assist travelers, ODTAs, FDTAs and DMMs with 

answers to frequently asked questions, 

important DTS Point of Contacts, available DTS training, and travel regulations. 

Approving Officials will also find it very 

useful. Users can find everything from 

important forms to travel regulations on 

the Splash Page. All the information you 

need is easy to find on one page.

DCSRM continues to maintain the 

Splash Page by keeping it up to date and 

well-organized. The DTS Splash Page is a 

powerful tool and has helped tremendously 

since its launch date, less than a year ago. 

As proof of the effectiveness of the Splash 

Page, the number of requests for assistance 

regarding DTS has, for the most part, 

stopped. It is definitely a valuable web page 

to have opened while using DTS.
(left to right) 

Back Row: Yolanda Johnson, Nikita Jett, Altreece Snoddy, Chris Zimmerman, Michael Davidson, Daniel 

Lopez, *Grayling Johnson, Thomas Ruth, Don Canada, John Masters Jr., David Rossley, Kyong Yim Kim, 

Rathelis Mobley, Tara Amos-Edmonds, Walter McGee, Tom Willson

Front Row: Joan Jackson, Kendle McKeel, *Lanette Miller, Pam Knowles, Tatjana Palmer, Kristina Gray, 

Jessie Davis, Cathy Ferguson

Professional Resource Management Course (PRMC) 08-I
Comptroller Proponency Office

Office of the Assistant Secretary of the Army 

(Financial Management and Comptroller)

Resource Management

Professional development bulletin

ISSN 0893–1828

ATTN: SAFM–PO, 109 Army Pentagon, 

Washington, DC 20310–0109.