RESOURCE

Getting Down to Business

M ANAGEMENT

1st Quarter 99

PB 48-99-1

Publication approved for public release; distribution unlimited

A salute to National

Women's History Month

INSIDE

This issue of

Resource Management

Privatizing

rotary wing

training 17

Fiscal 1998

RM Award

recipients 29

Y2K: Are your

investments

safe? 21
MEMORANDUM FOR DIRECTOR, ADMINISTRATION AND MANAGEMENT

DIRECTORS OF THE DEFENSE AGENCIES

ASSISTANT SECRETARY OF THE ARMY (FINANCIAL

MANAGEMENT AND COMPTROLLER)

 SENIOR CIVILIAN OFFICIAL, ASSISTANT SECRETARY

OF THE NAVY (FINANCIAL MANAGEMENT AND

COMPTROLLER)

 ASSISTANT SECRETARY OF THE AIR FORCE

(FINANCIAL MANAGEMENT AND COMPTROLLER)

SUBJECT: Professional Development of Comptroller Personnel

Our financial community is in the midst of a major reform in financial management

policies, procedures, operations and systems, with the goal of producing financial statements that

receive unqualified audit opinions. This effort has been focused primarily on two structural

defects; a broad decentralization of operations, and an unmanageable number of financial

systems. To address the first problem, financial management operations have been consolidated

into the Defense Finance and Accounting Service. With regard to the second problem, the

Department has embarked on a major effort to streamline the number of finance and accounting

systems, working down from 327 different systems in place in 1991, toward a goal of 32 by

2003. With these two efforts well underway, the Department is driving to meet the goal of

producing accurate financial statements that receive favorable audit opinions.

Continuing this progress, however, will require the hard work and support of our highly

competent financial management professionals. For our people to continue meeting the many

challenges resulting from financial management reform, we must be committed to their

continuous professional development. To that end, we should encourage our financial

management personnel to participate in professional development activities, such as the

American Society of Military Comptrollers, Association of Government Accountants, and the

educational activities of the Joint Financial Management Improvement Program. Such

organizations can enable our people to increase their knowledge and skills, and stay current on

fast-breaking issues. Professional organizations offer an excellent opportunity for employees to

receive up-to-date training on current issues. Participation in activities of professional

organizations and in training and development programs enhances the professionalism of the

comptroller work force and prepares us to meet present and future challenges. I strongly endorse

participation, at all ranks and grades, in these activities.

William J. Lynn

UNDER SECRETARY OF DEFENSE

1100 DEFENSE PENTAGON

WASHINGTON DC 20301-1100

COMPTROLLER Jan 7 1999

2 RM n 1st Qtr 99
A message

from the Assistant Secretary

of the Army (FM&C)

Helen T. McCoy

RM n 1st Qtr 99 3

This issue of RM features articles regarding entrepreneurship,

reengineering, and privatization  topics associated with our ever-increasing

concentration on change, efficiency, and innovation. And the concentration is

well warranted. We in the Army are fighting to maintain the effectiveness of

our forces following significant reductions in traditional financing sources. A

chief weapon in this battle is the search for and implementation of better

business practices.

Both necessity and foresight play roles in seeking better business practices.

We have built Program Objective Memoranda and budgets for the past few years that assume billions

of dollars in planned efficiencies will be achieved. Without the savings from the efficiencies, the

budgets are not viable. The Army is implementing efficient practices out of necessity. We also know

that the Army has assets with potential for creating income or additional value to support operations.

Business practice innovation can be the tool to realize that potential. Foresight is the motivator here.

An organizational climate that fosters entrepreneurship, innovation, and creativity can certainly elicit

ideas to improve business practices. However, I believe it is possible to do more than merely encourage

the workforce to, Go forth and commit innovation. I have chosen to institutionalize the process

throughout my organization. Each office is motivated to look for better ways of doing business. I also

have a small team of experienced resource management professionals that are not involved in day-today operations. Their mission is to spearhead efforts to improve business practices by reducing and

avoiding costs; generating and collecting revenue; streamlining and consolidating operations; and using

partnerships and regionalizations to reduce infrastructure requirements. The office does not have

operational responsibility for the issues it addresses. Rather, by working issues in conjunction with the

operational proponents, the analysts serve as catalysts for change.

In times of retrenchment, some might consider the push for creativity and existence of an office

devoted strictly to innovation and change to be a luxury unaffordable. I, however, feel that austerity

demands we pursue efficient business practices, and the investment in an organization dedicated to

those ends is an investment in the true meaning of the word.
4 RM n1st Qtr 99

Resource Management is an official professional bulletin published quarterly and sponsored by the Assistant Secretary of the Army for

Financial Management and Comptroller. Unless

otherwise noted, material may be reprinted provided the author and RM are credited. Views

expressed herein are those of the authors and

not necessarily those of the Department of the

Army or any element thereof. RM provides a

forum for expression of mature, professional

ideas on the art and science 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: Editor, Resource Management, ATTN:

DFAS-IN/U, 8899 E. 56th St., Room 207E,

Indianapolis, IN 46249-0150. Queries may be

made by phone to DSN 699-2911/1138 or commercial (317) 510-2911/1138. Please send a

copy of each submission to Tony Polzak, SAFMPO, ASST SEC ARMY FIN MGT, 109 ARMY

PENTAGON, Washington, DC 20310-0109.

POSTMASTER: Please send address

changes to Defense Finance and Accounting

Service -- Indianapolis Center, Editor, Resource

Management, ATTN: DFAS-IN-U, 8899 E. 56th

St., Room 207E, Indianapolis, IN 46249-0150.

MANAGEMENT

Contents

Getting Down to Business

This medium is approved for 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:

United States Army Chief of Staff

DENNIS J. REIMER

Administrative Assistant to the

Secretary of the Army

JOEL B. HUDSON

05662

Official:

DISTRIBUTION: Special

Secretary of the Army:

Louis Caldera

Assistant Secretary of the Army

(Financial Management and

Comptroller):

Helen T. McCoy

Managing Editor,

the Pentagon:

Tony Polzak

Acting Editor, DFAS-IN:

Myra Hankins

Second class postage paid

at Indianapolis, Indiana

ISSN 0893-1828

RESOURCE

1st Quarter 99 PB48-99-1

Memo

Memo from the Under Secretary of Defense (Comptroller) 2

Letter

Message from the ASA(FM&C). 3

Entrepreneurship and the DoD: Part II

Identifying the role of entrepreneurship in DoD and the U.S. Army 5

The reengineering phenomenon

Lessons learned from industry applied to the Army 9

The privatization of rotary wing training

Should the Army privatize its rotary wing flight training program? 17

Y2K: Are your investments safe?

If you play the open market, pick peaks and lows and stick to them 22

Dis is mismanagement

Managing people as corporate property decreases productivity

and morale 23

Three pillars of RM success in contingency operations

Adapting standard tools to work in contingency operations 26

Fiscal Year 1998 RM Award Recipients 29

Centralizing the disbursing missions within DFAS Indianapolis

First in a series of articles depicting functions at the Indianapolis Center 34

Perspectives

Guidance, information from OASA(FM&C) deputies 36

Professional Development Highlights 40

Memorandum for CP-11 Careerists 42

CP-11 Mission and Vision Statement 43

On the Cover:

A Salute to National Women's History Month

Clockwise: A communications specialist works at U.S. Army

Central Headquarters; Sgt. Bailey works on her laptop for the

The Judge Advocate General Staff office; U.S. Army Ranger

pilot and crew chief conduct helicopter flight operations; Spec.

Melissa Rathburn-Nealy, the first female to be taken prisoner by

Iraqi forces; An air traffic controller works in a control tower;

Military policewoman directs a convoy of armored vehicles;

Spec. 4 Mechelle Kowalski, a signal intelligence specialist;

Center: Drill sergeant adjusts soldier's gear.
RM n1st Qtr 99 5

Entrepreneurship and the DoD

Identifying the role of entrepreneurship in

DoD and the U.S. Army

by Capt. Craig M. Newman

Part II of a two-part series.

Examples of government entrepreneurship. Public-private venture or

PPV partnerships are a program on the

leading edge of government entrepreneurial thinking. Several federal resource managers credit the programs

success to Martina Garrison of the

Armys Community and Family Support

Center. As explained by Garrison, what

has driven this project is the Army

morale, welfare and recreation or MWR

funds need for additional money. The

center has about a $40 million annual

budget but could easily use over $100

million. The PPV concept aims to

augment the funds program through

private firms.

This venture pursues private-sector

developers to finance, build, operate and

maintain community facilities or

services on Army installations. This

provides a service for the installation

while avoiding costs of initial construction and recurring maintenance and

utilities. The program serves as an

alternative delivery system for MWRs

programs and facilities. A secondary

purpose of the PPV program is to

provide a supplemental revenue stream

to installation MWR programs. According to Michael Rhodes of the Armys

Community and Family Support Center,

the current MWR PPV process embodies the asset management concept

which envisions real estate as a profit

center to be maximized rather than a

cost center to be minimized. Asset

management is aimed at enhancing

benefit or value to an organization

through a continual process of identifying real estate that is not performing at

its highest or best use.

Synopsis of part 1: The definition of entrepreneur has evolved

over the centuries and leading business analysts today state that the

future of entrepreneurism will depend on government agencies such

as DoD. Although significant resource control differences abound

between private entrepreneurial firms and DoD, lessons can be

learned from private industry. What is important are that the DoD

leadership understand the concepts of entrepreneurism and that these

concepts be carefully made part of organizational strategy. DoD can

be an entrepreneurial organization in spirit; a starting point is to

identify barriers that keep the organization from instilling such a

spirit.

Ellsworth discusses barriers to entrepreneurship as having four

origins: societal, strategic (goals and functional policies), organizational (formal and informal) and individual (societal and psychological). Individualism is still a major motivator that drives how most

American enterprises are run. Chief executive officers are provided

stock options as incentives to ensure that their self-interests match

those of shareholders, i.e., to maximize profits. The pattern of goals

and functional policies making up a companys strategy can stifle

entrepreneurial decision-making in large organizations.

Good near-term financial performance is not synonymous with

continued competitiveness. If entrepreneurial activity is to be successful over the long term, those with entrepreneurial attributes need to be

tied to the company by shared values and goals.Without compatibility

between the values of the entrepreneur and the company, the aggressive posture of the entrepreneur is more likely to be perceived by

superiors as a personal threat. When that occurs, superiors become

reluctant to give the necessary autonomy and resources to the entrepreneur. Values supportive of entrepreneurship need to be woven into

the fabric of the companys culture rather than to become an isolated

counter-cultural appendage that can be gradually overwhelmed by the

weight of the organizations central values.

Many programs are already in place that can make entrepreneurial

ideas successful within DoD. One of these programs is incentive

awards that are written into law which permit cash awards to individuals that save DoD money. The problem is the lack of leadership

encouragement to get employees interested in such programs.

Entrepreneurs are people who have the ability to see and evaluate

business opportunities, to gather the necessary resources to take

advantage of them and to initiate appropriate action to ensure success.

Entrepreneurs are action-oriented, highly motivated individuals who

take risks to attain goals. The following list of characteristics and

traits provides a working profile of entrepreneurs: Self-confidence,

Task-result oriented, Risk-taker, Leadership, Originality and Futureoriented. (Meredith, 3).
6 RM n1st Qtr 99

As of last summer there were 20 PPV projects

being considered totaling over $150 million in

potential taxpayer savings. PPV began in 1993 and is

about to finalize its first public-private deal, a car

wash at Fort Carson, Colo. For a public agency, this

may have set a new standard for expediting a program

of this size. According to Garrison the greatest

challenge to implementing this innovative program

was getting interest and approval from supervisors,

other agency directors and finally Congress. Although

the programs execution falls within Federal Acquisition Regulations, it took open-minded interpretation

of the regulations, as Keogh had

discussed (see part 1, in the 4th Qtr 

98 RM); standard bidding procedures

were not used.

What makes this endeavor entrepreneurial are the individual and

group traits that were required to

make this project successful. These

traits as explained in detail earlier

include the heterogeneous range of

personal traits: initiative, creativity,

high achievement, motivation,

perseverance, enthusiasm, competitiveness, inventiveness and willingness to assume risks. An individual or

organization that becomes frustrated

and overcome by bureaucracy will never see a

government project of this magnitude through to

completion. DoDs corporate culture is such that

managers protect their domain; when an agency

develops a program with little recognition, much

added work and big change to the daily routine, the

natural reaction is to fight the project. These barriers

had to be overcome by Garrison and her team to

successfully implement the PPV program. That of

course is not the case in all instances and there

appears to be a change occurring that fosters better

cooperation among agencies.

Federal agencies

Several other Federal agencies have developed

programs considered entrepreneurial. The U.S.

Internal Revenue Services budget director used

knowledge and experience in budgeting rules to

assemble an innovative $2 billion package of additional investments to increase tax compliance. The

Patent and Trademark Office has been operating

without appropriated funds since 1991 because user

fees have made the agency self-sufficient. The

Immigration and Naturalization Service and the

Department of Veterans Affairs are leading the way

in creating solid fee structures to pay for some

services, due mainly to entrepreneurial financial

managers (Phillips, 45).

Recommended programs

Cultural changes

DoD is many years from meeting the currently

accepted definition of entrepreneurship; however,

innovation within DoD is strong, particularly within

the research and development community. If that had

not been true, the U.S. would not be the only superpower remaining today. For DoD to become an

entrepreneurial organization, its

culture will require major

changes. I agree with Pat Keogh

that the Army is full of bright

innovative minds and that

entrepreneurs exist within our

organization. Whats suppressing

these individuals is not the

regulations but the leaders who

interpret them and the crossagency barriers that have made

cooperation so difficult. The

individuals in the Army MWR

fund who have worked so hard at

developing such large costsaving endeavors, should be

financially and publicly rewarded for their efforts.

They have not only provided a program that could

immediately save over $100 million but also given

DoD personnel quality-of-life improvements, established an entirely new method for managing resources

and opened new doors to cross-agency cooperation. It

would be difficult to place cost savings on these

changes; however, if DoD leaders grasp the potential

of this program and improve on it, the savings could

be in the billions of dollars. A traditional response to

such savings would be to cut Army MWR dollars by

the amount of realized savings, thereby offsetting

gains fund managers have worked to increase. This

has been the reality of dealing with public dollars; its

also the attitude that suppresses entrepreneurial

minds.

Total Quality Management

 There is merit to the idea that DoD implement

concepts of Total Quality Management. According to

Krajewski and Ritzman (Operations Management, p.

137) TQM stresses three principles: customer satisfaction, employee involvement and continuous

improvements in quality. TQM also involves benchThere is merit

 to the idea

that DoD

implement

concepts of

Total Quality

Management.
RM n1st Qtr 99 7

marking, product and service design, process design,

purchasing and problem-solving tools. Many scholars

dispute the fact that these ideas originated in the U.S.

and have been around for years. The Japanese, however, were able to implement TQM, and the results

became evident in the late 1970s and 1980s. It took

Japanese success with TQM to wake up American

industry.

TQM is no longer a strategic advantage but a

requirement of survival for any business or industry.

The federal government can learn from the Japanese

and U.S. industry success. The most important TQM

principle that government agencies

can implement is employee involvement. A complete program in

employee involvement includes

changing organizational culture,

fostering individual development

through training, establishing awards

and incentives and encouraging

teamwork (Krajewski, 143).

Organizations, public or private,

that empower their employees to

make decisions without fear of

recourse are on the path to success.

Without a doubt, the best ideas on

cost savings and readiness improvement have come from the lower

ranks. A comparable private industry example is a

recent central New York newspaper article about

Bristol-Myers Squibb, a pharmaceutical company that

produces large quantities of penicillin. The news

article referenced the million-dollar man, a worker

who saved the company millions of dollars through

innovative ideas. The success of this story was not

only that of the individual, but also that management

was willing to listen to this lower level employee

(someone who lacked a formal engineering background) and invest in his ideas. Entrepreneurial ideas

are available to DoD; however, until the present

mistrust by leadership and organizations of Defense

employees is lifted, such ideas may not develop.

This organizational mistrust goes deeper than just to

its own employees. The regulations and costs put into

monitoring employees far exceed the benefits provided. Federal regulations often base themselves on

the premise that, given the chance, employees and

contractors will steal from or somehow deceive the

government. This premise leads to an exorbitant

amount of lawyers, auditors and regulations. Any

organization with this amount of open mistrust will

not foster a cooperative environment among its

employees, suppliers and contractors.

Private industry supply chain management concepts foster trust and cooperation among businesses

and in some cases among competitors. It is often to

the benefit of one business to train and help develop

another businesss processes in order to benefit its

own. It would seem that a private industry with

limited resources would have much more to lose than

a government if this concept failed. These partnership

programs are providing private businesses with

competitive advantages within their industries.

Employee incentives

According to Dr. Dale Geiger,

a frequent RM contributor on

identifying and controlling costs,

The Army must recognize that

every officer, NCO, soldier and

civilian manages a resource even

if it is their own time. All must

understand that in todays financial environment it is expected

that each have the responsibility

and obligation to continually

improve the management of their

resources. Cost is simply a way to

measure this fact and facilitate its

accomplishment. 

However, this statement fails to address how these

responsibilities and obligations can be successfully

implemented. What incentives are provided to the

listed individuals? All the current issues being

discussed on soldier pay, quality of life initiatives,

closing the Army MWR facilities, and so on, are a

part of the daily lives of soldiers on installations

throughout the world. To tell soldiers that they have

the responsibility and obligation to continually

improve resource management is going to take much

more than words to implement. If a soldier observes

that funds saved from recycling paper give direct

savings at the movie theater each week, the recycling

program will be a major success. When unit fund

money that was used for unit events was reduced,

soldiers began their own programs to raise funds for

these unit events. The reason this is successful is that

soldiers enjoy the unit organization days, and the

funds they raise are completely used for them and

their families, not reappropriated to a construction

project on some other installation.

Resource managers would be kidding themselves

to think they can use duty, honor and country to

Private industry

supply chain

management

concepts foster

trust and cooperation among

businesses
8 RM n1st Qtr 99

About the Author

Capt. Craig Newman, a career FA 45 officer, graduated last August from the Army Comptrollership Program at

Syracuse University, where he wrote this article as his class paper. He is now attending the Command and

General Staff Officer Course at Fort Leavenworth, Kan.

implement resource saving initiatives from individuals raised in an individualistic society. Lower grade

soldiers and civilians have the same self-interests as

senior managers. If we provide incentives that

directly benefit the individual and small group (unit

level), then we can conserve our limited resources.

Employee motivation

Entrepreneurs are successful motivators of their

employees. This trait is difficult to learn and even

tougher to implement in a large bureaucratic organization. The best ideas available in an organization

come seldom from the few at the top but often from

the masses that work the real issues on a daily basis.

How do entrepreneurial leaders motivate their

employees to provide such ideas? Meredith et al

(p18) provide these techniques: build workers selfesteem, inform employees, delegate authority and

responsibility, maintain contact, analyze the problem

not the person, apply the reinforcement principle, be

an active listener, set specific goals and continually

review them, and take corrective action. All of these

concepts are taught at most military schools; it is the

challenge of leaders to implement them.

Humans by nature do not like or accept change

willingly. We see daily examples of change avoidance in projects such as implementing a new software

system or transitioning from typewriters to personal

computers. Systems that will improve efficiency at

many levels are considered threats to daily routines

and possibly perceived as threats to individuals jobs.

My impression of a successful entrepreneurial leader

in a bureaucracy as large as DoD or the Army is a

tenacious individual willing to take chances who

understands the people within the organization. Such

people are able to motivate individuals to accept and

participate in the future.

Conclusion

Although the term entrepreneur has changed in

meaning over time, it is still a concept difficult to

establish in a large bureaucratic organization. There

are lessons to be learned from private industry;

however, the distinctions are such that care is needed

not to make a complete comparison. Entrepreneurial

attitudes will provide the innovation needed to

maintain leading-edge technology and give warfighters resources they need to maintain an unchallenged advantage. Significant organizational changes

are needed to give innovative thinkers the ability and

desire to see programs through to completion. Incentives, trust and cooperation are a good beginning but

need to be sustained by senior leaders support. When

DoD establishes itself as entrepreneurial, it will likely

be due to a senior leader in the organization who is

able to project her or his vision to subordinate leaders

and is willing to remove from leadership roles any

who are unable to implement the needed changes. It

takes the entire team of a corporation to make the

kind of changes required of a corporate culture

change.

References

Lakhanpal, Ajay, Entrepreneurial Development,

India: Commonwealth Publishers 1990, pp. 2-4.

Meredith, Geoffrey G., et al., The Practice of Entrepreneurship, Geneva: International Labour Office, 1982, p.3.

Ellsworth, Richard R.., Entrepreneurship in Big

Business: The Impossible Dream? Working Paper,

Harvard Business School, July 1983.

Schollhammer, Hans, in Encyclopedia of Entrepreneurship, eds Kent/Sexton/Vesper New Jersey: Prentice-Hall

Inc, 1982, pp. 209-213.

Gendron, George, The Hottest Entrepreneur in America?,

Inc Magazine, May, 1996, p. 11.

Kirzner, I.M., in Encyclopedia of Entrepreneurship, eds

Kent/Sexton/Vesper New Jersey: Prentice-Hall Inc, 1982,

p. 250.

Krazner, O.J., in Encyclopedia of Entrepreneurship, eds

Kent/Sexton/Vesper New Jersey: Prentice-Hall Inc, 1982,

pp. 277-281.

Hughes, Jonathon R.T., Entrepreneurship, in Encyclopedia of American Economic History, ed.Glenn Porter,

New York: Scribners, 1980, p. 68.

Branstetter, Ross W., Acquisition Reform: All Sail and

No Rudder,Army Lawyer, March, 1998, p. 3.

Madore, James T., Local Small Business Owners

Prepare to tell White House: Follow our Lead, The

Buffalo News, June 5, 1995.

Gribben, Mark, The Rickover Award, Marks Politics

Page, gribbenm@pilot.msu.edu.

Phillips et al., Public Dollars Common Sense, Washington, D.C., Coopers & Lybrand L.L.P. 1997, pp 45-49.
RM n1st Qtr 99 9

A major problem confronting business and

government today is how to increase productivity

and provide higher levels of service and responsiveness, while at the same time reducing costs. This

same dilemma faces the Army, as the budget continues to spiral downward and responsibilities spiral

upward.

The business environment today is marked by

change, chaos in the markets, organizations struggling to redefine themselves, structures that no

longer work and management philosophies that are

quickly outdated. Todays Army environment

parallels industrys chaos and uncertainty with its

priorities evolving as national security threats

change, roles transform from warrior to peacekeeper, and the force stands down as missions alter

from the large Cold War threat to many smaller

global infractions and nation-building efforts.

Three major drivers influencing and encouraging

change are:

s Government, such as deregulation, increase of

free trade, and trends toward privatization;

s Technology, especially computers and information systems which increase the speed with which

information is disseminated and used; and

s Globalization, with corporations expanding their

markets and DoD joining forces and missions with

NATO and other allies (Champy & Nohria p.vii).

An organization that can redefine itself to become

flexible, streamlined and responsive to the volatile,

uncertain future has taken a step in the right direction.

Reengineering definition

To succeed in todays fast-paced world, companies

and government agencies must reengineer themselves,

permanently transforming the entire orientation and

direction of the organization.

Reengineering is reinventing the enterprise by

challenging its existing doctrines, practices and

activities and then innovatively redeploying its capital

Reengineering

phenomenon

by Maria T. Van Syckle

and human resources into cross-functional processes

...with the intention to optimize the organizations

competitive position, its value to its shareholders and

its contribution to society. (Bennis & Mische p10).

Myths about reengineering

There are some fallacies circulating about

reengineering that need to be dismissed  for

example, that reengineering...

is another word for downsizing,

means doing more with less,

is only about information technology,

can be used to fix any problem, and

creates anxiety and chaos that are detrimental to

the organization.

If reengineering is implemented and managed

correctly, these mindsets can be invalidated.

The terms downsizing and reengineering often

become too easily interchanged, especially in the

government. Organizations think that by cutting

people, they are in effect reengineering; but in

reality, downsizing is neither innovative nor effective. It is managements easy out when they run out

of ideas to save money. Downsizing is the simple act

of removing people while the work remains, as do

the old methods, the old systems, and the old processes for getting the job done. It is a short-term

fix that looks good on paper but not over time when

systems break down. Productivity, employee morale

and customer service suffer as employees try to

increase their effort to compensate for the people

who were let go.

Reengineering is concerned with doing things

differently and more effectively. It does not start

with the premise of eliminating jobs, nor does it

inevitably lead to downsizing. Unfortunately, some

organizations haphazardly eliminate positions,

cutting deep into their core cultures and losing

knowledge, leaders and values.

Since 1989, DoD has focused on extensively

drawing down end-strength, purely by numbers at

Lessons learned

from industry

applied to the

Army
10 RM n1st Qtr 99

the top level. DoD downsizing and streamlining

efforts are poorly addressed by outmoded processes

such as reductions in force and employee buyouts.

According to an August 1996 General Accounting

Office report, the DoD workforce was downsized

without a corresponding decrease in workload,

thereby making agencies experience work backlogs,

service shortfalls and increased overtime (Phillips et

al p215).

Voluntary buyouts offered to federal workers

induce experienced personnel to quit or retire early

from critical operations, causing a skill imbalance

and an exodus of corporate memory

and competence. Voluntarily forfeiting talent becomes suicising, not

downsizing (Bennis & Mische p3).

Information technology is an

essential enabler in reengineering

efforts, just as talented workers are;

but it is not the cure-all that some

expect. When used properly, information technology can drive business

process redesign faster and farther

than expected; however, it could also

be a disabler when invested in legacy

systems and processes.

One Fortune 1000 company

invested $7 million in new technology and software

to support order entry and manufacturing processes.

Its objective was to have the software enhance and

support how we do business (Bennis & Mische

p3). It was an unmitigated failure, squandering

considerable resources and time. Senior

managements big mistake was its reluctance to

disrupt the organization to reengineer its existing

processes and organizational responsibilities;

instead, it relied fully on the information technology

as its panacea. The company discovered that automating its old processes, which were filled with

duplication of effort, caused the opposite effect of its

intentions  increased inventories, head counts, cycle

times, and order backlogs. Michael Hammer,

reengineering pioneer, says, Dont automate,

obliterate because turning the cow paths of

business processes into superhighways using computer systems does not work (p1).

The notion that reengineering creates anxiety and

chaos, which is detrimental to the organization, is

also a myth. Anxiety and chaos may result if the

effort is managed poorly, but the reality is that

reengineering can increase employee morale and

organizational cohesiveness. Constructively challenging and analyzing an organizations hierarchy

and activities based on value, purpose and content

can increase employee interest and appreciation of

the enterprise, its leadership and its products or

service.

Reengineering history

As society enters the information age, business

process reengineering will be instrumental in propelling organizations into the future, leaving the past far

behind. This information revolution, similar to the

industrial revolution, is marked

by chaos and uncertainty, with

sources of power shifting to the

next paradigm; however,

businesses goals and strategies

have not caught up (Grover &

Kettinger p57).

The total quality management

philosophies of Joseph Juran

and W. Edwards Deming have

helped the reengineering

revolution evolve. Their philosophies are clearly processfocused and in contrast to the

scientific theory of western

management, which defines work into discrete,

simple, repetitive tasks that can be performed by

lesser skilled employees and through automation.

With the shift to the information age, the entrenched

scientific philosophy must be broken to think more

in terms of processes, natural work groups, corefunctional work cells and cross-functional employeesalways keeping in mind the customer (Grover

& Kettinger p58).

Analysis of the Army reengineering effort

For decades the government followed the processes of the past, which were bound by legal

mandates and internal tradition and not necessarily

by common sense. Government employees, trapped

in a maze of outdated ways of doing business,

simply asked for more money to keep operations

afloat as the environment got more complex. There

was no incentive to rethink how government business was conducted; but now resources are scarce

and government performance is less than desirable.

Government must stop its old habits, examine its

new mission, focus on its customers and reinvent

itself.

The total quality

management

philosophies of

Joseph Juran and

W. Edwards

Deming have

helped the

reengineering

revolution evolve.
RM n1st Qtr 99 11

DoD has taken steps in the right direction to

change its visions and missions with convergent

reinvention conferences. As examples, the Defense

Science Board identifies specific areas and approaches for lowering support costs while enhancing

performance, and the Quadrennial Defense Review

reassesses Americas defense strategy, force structure, modernization programs and infrastructure to

lead the force of the 21st century. The National

Partnership for Reinventing Government (formerly

National Performance Review) continually strives

for a more efficient, effective and productive government. The Army has responded to all these

initiatives with a good faith plan by creating at

least 44 reinvention laboratories and centers Armywide, policies to waive restrictive Army regulations,

and a reengineering legislative working group to

assist in legislative change proposals (according to

the 1997 Army National Performance Review

report).

Review of the effort to date suggests that there is

a strong framework with good intentions of improvement; but instead of reengineering the way it is

definedthrowing out old processes and reinventing

radically new onesthe Army is just modifying the

current ones. On their reengineering home page, for

instance, Forces Command reports news releases of

successful reinventions such as espionage briefing

changed from annual requirement to every two years

and civilian ID cards issued indefinitely instead of

expiring after four years. Clearly these are not

examples of reengineering but just doing business

smarter.

Some projected initiatives from the last review

include personnel losses of 45,000 over fiscal years

1998-2003 and support missions moving from inhouse functions to contractors (Brower). Haphazard

cuts and redistribution of old processes to contractors are not the focus or the intention of

reengineering.

In order to keep up with these dwindling resources, the Army needs to take the initiative and

make bold, global transformations that may go

against the political grain. As the Army continues its

metamorphosis, lessons learned and best practices

from industry and reengineering pioneers will spur it

along the path to success.

Defining characteristics for success

To be truly defined a successful reengineering

undertaking, organizations must incorporate the

following critical characteristics: process focus,

radical change and dramatic improvement. They are

the pillars of Carr and Johanssons business process

reengineering temple and together with the foundation of best practices and change/risk management

will keep any project from crumbling.

In figure 1, the roof, encroaching the

reengineering temple, refers to the organizations

need to be competitive particularly in the areas of

cost, quality, lead time, delivery reliability, product

characteristics, product support and service.

Process focus

For an organization to get the largest business

process reengineering reward, the focus should be

on core processes which directly touch customers

and suppliers, rather than on processes that are

completely internal to the organization. Taking a

process view (horizontally cutting across functions)

instead of a functional view (vertically feeding

processes) allows management to clearly define its

missions and goals. One of the first steps the Army

must complete is to define its core competencies so

that it can target these areas for maximum results.

Radical change

To begin to reinvent itself, an organization needs

a clean slate so that it can focus on future customer

needs. This method allows people to move away

from traditional ways of thinking, and embrace

thinking outside the box, not necessarily destroying assets but rather leveraging a companys core

competencies and meaningful management investments.

Dramatic improvement

Business process reengineering is not about

several minor 5 to 15 percent incremental improveFigure 1
12 RM n1st Qtr 99

A vision transformation does not necessarily

mean the company is not exceeding performance.

Good examples are Home Depot, GE, Yamaha,

Motorola, Kao and Bausch & Lombthey desire to

dominate or change an entire industry. Home Depot

redefined the industry and manner in which people

shopped for home remodeling materials when it

launched the concept of retail warehousing with

huge quantities of in-stock items, everyday low

prices and highly paid and knowledgeable workers.

It reengineered the traditional hardware and building

supply industry and also created a completely new

retailing concept (Bennis & Mische p6).

Top management agrees that the transformation

effort must start with an awareness of the urgency to

achieve improvement and a clear vision toward

which management and employees can work.

When there is no vision, the people perish.

Proverbs 29:18.

An analysis of several vision statements of Army

reengineering efforts suggests some of them may

need refocusing with clearer, more specific and

farther-reaching goals. For example, when the

Armys Financial Management or FM Redesign

office was asked if there was a top-level overarching vision statement with specific stretched

targets, the answer was no (Bonessa). In most Army

initiatives, urgency is apparent at the top, but clear

direction, appropriate resources and wide communication are lacking to disseminate the compelling

need.

A systematic approach

According to Grover and Kettinger, organizations

are motivated to reengineer by one of three driving

forces:

s Desperation or crisis (60%)where they must do

something radical to survive and have little to lose

(e.g., General Motors and Chrysler in the 1980s)

s Foresight (30%)where they anticipate reaching

desperation unless they do something to avert it

s Ambition (10%)where they move to a new

paradigm to create crises for their competition (e.g.,

Home Depot) (p. 60)

There are several approaches to reengineering,

but it is best to find the one that fits each organization and its corresponding motivating forces. The

model in figure 2 depicts an evolution to business

process reengineering ranging from incremental

changes to the dramaticscrap the old and start with

a blank sheet.

ment gains, which most organizations are content

with, but is characterized by dramatic improvements

of 50 percent or better applied to core business

processes for the most quantum results. Targets must

be stretched beyond their limits; for example,

productivity gains of 50 to 100 percent, inventory

reductions of 50 to 60 percent and cycle time

improvements of 50 to 300 percent (Bennis &

Mische p13).

Strong foundation change, risk management

Unfortunately, business process reengineering can

be risk intensive because many earlier reengineering

projects failed or did not realize their initial targets

due to improper planning. Leaders must decide

whether the potential rewards are worth the investment and risk. If the decision is to proceed, they

must protect the company with a detailed change and

risk management plan.

Best practices

The most resourceful way to mitigate risk is to

leverage off the best practices of those organizations

with proven reengineering successes.

Essential elements of reengineering

To obtain the most effective reengineering

program, many companies and reengineering

pioneers advise amateurs, such as the Army, to

incorporate the following essential elements and best

practices in all their efforts.

A bold vision

During the period of transformation, a wellarticulated vision statement, expressed in specific

performance outcomes and related to its core competencies, is vital to effectively communicate the future

direction of the organization to its customers but

more importantly to its employees. This interaction

enables every business unit and employee to tie their

strategic goals and objectives to achieving that

vision.

Gerald Isom, President of CIGNA Insurance, was

reviewing the past five years poor results and

realized that the company had talented peoplea

vital core competencybut was out of focus. He

instituted the basic vision to be one of the better

specialist property and casualty [P&C] companies in

the industry (Conference Board p9). It is hard to

compete and be successful when the strategy is

incompatible with the core competenciesCIGNA

P&C was being managed as a generalist company

when its employees had specialty characteristics, a

detrimental combination.
RM n1st Qtr 99 13

The less extreme of the two is a system of

mapping the as-is processes, then modifying

major parts of them. This is the traditional approach, but it is designed to satisfy only near-term

objectives and not yield dramatic results. According

to the reengineering definition, revolutionary

transformation is the only effective method, since it

yields results of 50 percent or better and concentrates on all activities, not just one aspect of the

organization.

Mark D. Youngblood of the Renova Corporation

recommends coupling reengineering with total

quality management in order to bring about real

sustained change. Reengineering is top-down, rapid,

dramatic and macro, while TQM is bottoms-up,

incremental, micro and continuously improving.

The two successfully join to yield long-term,

supported improvements (The Conference Board

p25)

Some companies caution novice reengineering

implementers against using certain basic approaches. The magic wand approach, which is to

apply simplistic, packaged solutions to complicated

problems, could be a forced mismatch. Others guard

against benchmarking yesterdays job-based

practices, because it stifles forward thinking and

puts the organization behind the power curve for

tomorrows market-process world. By emulating

even the best of the past, barriers are built to future

effectiveness. The secret of reengineering is to

focus internally, not look outside the organization

for a whiz-bang solution.

The Army is nearing the point of desperation.

Agencies are gearing up for a transformation effort;

however, most efforts are hedging toward small,

incremental modifications instead of the clean-slate

approach. For example, the FM Redesign effort is

mapping as-is processes for improvement with

guidelines of small steps, collaboration, demonstrated success and hand-off (Bonessa). Its information technology effort is focused on sharing

different independent automation tools that tend to

be piecemeal and specific to one agencys idiosyncrasies. With no overarching consolidation and

integration, the effort is frustrating and less rewarding.

Clear intent and mandate

Once the vision and approach are selected, an

organization must demonstrate clear intent and

compelling need to accomplish the reengineering

effort. To effect lasting systematic change, the

organization must begin with specific intentions and

understand that the final result will be an entirely

different enterprise.

Top management must mandate change and be

heavily involved from the onset and throughout the

process. In quality improvement projects, the

visibility of senior management is important early

on, but it decreases in importance over time; however, in reengineering projects, the visibility and

commitment is [sic] vital from the start and intensifies as the

project proceeds (Caron

p5).

With the

backing of top

executives who

allocate the

resources necessary to plan, implement and sustain a

reengineering effort, the message is evident that this

is not another management fad. Employees are

compelled to make performance breakthroughs and

take ownership of their new processes in order to

maintain the reengineering intent and attain their farreaching goals.

The Armys reengineering effort has very strong

leadership devoted to making the Army better;

however, to demonstrate true support, considerable

resources need to be applied with concentrated

executive involvement necessary throughout the

implementation process. Additionally, when organizations devise innovations that incur true savings, a

method to incentivize and foster pride in ownership

is to share these savings with the workforce or

contribute back into their organization (Kaminski

p9).

A specific methodology

To avoid chaos and lasting scars during the

reengineering process, a pre-planned, well-communicated methodology is critical. Organizations

should follow specific step-by-step procedures with

Figure 2
14 RM n1st Qtr 99

enough flexibility to accommodate new developments. Each organization needs to find the best

methodology that fits its needs or modify those of

successful companies. Figure 3 shows methodologies from several different large companies who

achieved favorable results, each following similar

core strategies with modifications (The Conference

Board p9; Carr & Johansson p189).

Effective and visible leadership

To have a smooth and efficient implementation,

top leadership must be creative, influential and

credible, with a track record of success and a solid

knowledge of the business. An effective

reengineering leader must be one part visionary, one

part communicator and one part legbreaker (Hammer and Stanton p48).

The driving force to success is to charter the

right-skilled team to set direction and priorities. At

Cigna Corporation, after the first reengineering pilot

program was successful, management formed their

own reengineering group to share knowledge and

experiences derived from one project to the next.

These talented leaders would serve on the

reengineering staff for 12 to 18 months and then

transfer to the business center where their skills

could be applied on a continuing basis (Caron p4).

With this approach, reengineering knowledge is

diffused and leveraged from one project to another

throughout the entire corporation, cultivating lasting

cultural change.

With the creation of 44 reinvention centers, the

Army is preparing an effective framework for

dramatic improvement and sharing of information

and best practices. It has only to promulgate its goals

and visions down to the working level and form

interactive teams to champion each cause.

Constant and open

communication

One of most critical

aspects of reengineering is

to communicate thoroughly, widely and

plainly. To ensure that

communications are clear

to all members, one

strategy includes segmenting the audience and

providing training sessions

specially developed for

each section.

Disseminating the

message constantly and

involving all employees in

the process improves

internal cooperation and

alleviates some of the fears

by giving the workforce a

better understanding of the

organizations needs and direction. At Cigna Property and Casualtys center, the reengineering team

carried out 30 different diagnostics and gathered

inputs from more than 1,000 employees through

surveys, interviews and workshops (Caron p10).

AlliedSignal found that the use of workshops was

very effective to communicate among all levels and

break through boundaries. Employees would collaborate to identify potential barriers and brainstorm

actions to overcome or mitigate them. This interaction created a cooperative and efficient environment

in which employees most familiar with various

processes transformed them while senior executives

with the power removed the hurdles. This technique

solved real problems, mapped out old processes and

made substantial progress toward attaining improvement objectives, all in a few-days workshop (Carr &

Johannson, p.188). Use of common language helps

form a strong base to springboard the reinvention

message.

Figure 3

ITT Business Unit Cigna Insurance AlliedSignal, Chemical,

Bell & Gosset, Co. Gerald Isom, President Bossidy

1.Organize BPR team & 1. Start with basic vision 1. Leveraged off TQM

 prepare game plan foundation

2. Identify critical core 2. Convince employees 2. Created a vision

 customer processes

3. Select core process 3. Break down barriers 3. Set aggressive goals on

in need of reengineering between businesses core competencies

4. Identify value-added 4. Reorganize centers to 4. Aligned HR system to

processes within core focus mission cultural change

5. Benchmark drivers of 5. Internally investigate & 5. Intensive & involved

performance revamp processes training with results

6. Quantify processes in 6. Complete review and 6. Charter teams with

detail to apply ABC align with HQ power to change

7. Create vision, 7. Build measurement 7. Conduct Value-added

communicate change,... technique to track analysis on processes

...Restructure, conduct 8. Sustain w/ training to

pilot program customers & suppliers
RM n1st Qtr 99 15

AlliedSignal found their reengineering experience

proceeded quickly and smoothly with the fundamental TQM language they had lived with for years. In

fact, the CEO never called it reengineering for fear

of clouding the issue, so he renamed the effort,

Total Quality through Speed.

The Army needs to project the urgency of reinventing its processes to the widest audience possible.

Perhaps, through all of the Armys intensive training

and workshops, reengineering should be implemented in its curriculum, as it was

in that of AlliedSignal. With the

Armys years of TQM experience,

leveraging off the TQM lingo and

policies may be a great strategy to

ease the reengineering transition.

Restructuring organizations

To successfully confront and

adapt to the challenges of a dynamic environment requires

adoption of new methods, skills

and structuresin short, a new

organization. The archaic, centralized organization is too slow, too

bureaucratic, too costly and too

inefficient to match the needs of

todays information-intensive community that

fosters flexibility, responsiveness and entrepreneurial spirit.

The future organization is a fluid adaptive network, where project teams form and reform or die

from disuse (Champy and Nohria p.xvii). Labor in a

network structure is not divided but rather shared

among knowledge workers or cross-functional

teams. These teams operate with little formal supervision. Through easy access to abundant information, knowledge workers rather than higher-level

managers handle decision making, cutting out

several redundant layers.

Future organizational boundaries will blur among

the organization itself and its vendors, customers and

competitors. GM is a perfect example. Originally,

GM had a separate strategic planning staff from its

operating staffisolating conception from execution. It realized this was inefficient, so it flattened

the organization. Then, GM focused on core competencies and changed its percent of internally produced value-added components from 90 to 40,

outsourcing the rest of the components to a network

of vendors that are viewed as not just suppliers but

genuine business partners (Champy and Nohria

p.xvii).

Sustaining improvement is not possible without

fundamental change in both the Armys organizational culture and its management processes. The

Army needs to reduce its layers and approval

authorities to become a flatter, leaner and more

responsive organizationempowering the individual. The Army Acquisition Corps integrated

product team concept has been

effective in involving all functional members and contractors

throughout the acquisition phases.

However, steps need to be taken

toward making the acquisition

manager accountable for the entire

life cycle, so that enormous

operation and support costs can be

controlled.

In part II of this article, in the

next issue of RM, the author will

expand the points below in addressing lessons learned, conclusions and recommendations for

strengthening Army reengineering

efforts. Lessons learned from industrys experience

will allow the Army to catapult ahead of the change

blockade. The Army has an entrenched political and

patriarchal culture that is very difficult to modify

because traditions, norms and fears are hard to

overcome. Organizations need to transform from

stovepipes to teams for a more responsive and

customer focused strategy. To alleviate stress during

these cultural changes, greater effort must be directed toward effective change management of

organizational culture, human resource management

and strategic planning.

Times will continue to change, so organizations

must stay one step ahead and look to the future for

the next innovation. The public is demanding higher

standards of performance, more effective management, greater accountability and enhanced value

from their dollars. Army leaders must equip themselves with the right tools to embrace change.

Reengineering of old processes, concepts and

organizations is imperative to respond rapidly and

support the critical missions of the war-fighter for

the 21st Century.

Organizations

need to

transform from

stovepipes to

teams for a more

responsive

and customer

focused

strategy.
16 RM n1st Qtr 99

About the Author

Maria Van Syckle is an Operations Research Analyst

in the Directorate of Resource Management of the

U.S. Army Communications and Electronics

Command at Fort Monmouth, N.J. She has a

bachelors degree in Industrial and Systems

Engineering from Virginia Polytechnic Institute and

State University. Van Syckle is a 1998 graduate of the

Army Comptrollership Program at Syracuse

University and wrote this article as her student paper.

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RM n1st Qtr 99 17

by Maj. Karl M. Kraus

In this day and age of budget cuts and widespread

belt-tightening, most government agencies are

looking for ways to stretch their dollars further.

Many agencies are evaluating the services they

provide and asking if private enterprise can furnish

these services in a more cost-efficient manner.

Advocates of privatization claim that industry can

provide many government services better and at less

cost than the government. But it is obvious that

certain activities such as the legislative system and

the command of military forces are inherently

governmental. These activities represent the core

competencies of the American government. One of

the biggest challenges to the privatization movement

is the question of which federal responsibilities are

eligible for transfer to the private sector.

The privatization of military institutional training

is an example of an activity that lies within this area

of debate. While it is clear that command of the

armed forces is an inherently governmental role,

many defense-related training activities are not.

Flight training is one of these activities. An increasing number of defense authorities around the world

are turning to industry to provide pilot training for

their forces. Canada and the United Kingdom have

contracted significant portions of their flight training

programs to the civilian sector. This report looks at

outsourcing and privatization, considers the feasibility of privatizing the U.S. Armys helicopter flight

training program, and recommends a proper level of

outsourcing/privatization for the programs future.

Regulatory requirements

Before analyzing the appropriateness of privatizing Army helicopter flight training, it is important to

understand the associated regulations and terminology. Office of Management and Budget or OMB

circular number A-76 establishes federal policy on

performance of commercial activities. It defines a

commercial activity as one which is operated by a

federal executive agency and which provides a

product or service which could be obtained from a

commercial source. A commercial activity is not a

governmental function (OMB A-76 p2). The goal

of OMB A-76 is to set forth procedures for determining whether commercial activities should be

performed under contract with commercial sources,

or if they should be accomplished in-house using

government facilities and personnel.

When considering the utilization of a commercial

source to perform commercial activities, the government must distinguish between outsourcing specific

activities and privatizing entire functions.

Outsourcing is defined as the transfer of a function previously performed in-house to an outside

provider (Army Regulation 5-20 p.G-18). Such a

transfer relinquishes the risks and responsibilities of

the activity from the government to a commercial

entity. Privatization actually represents a subset of

outsourcing. It is defined as the process of changing

a federal government entity or enterprise to private

or other non-federal control and ownership (AR 5-20

p.G-20). The key difference between the two is that

in outsourced functions the government retains

control, whereas through privatization it transfers

ownership and control of the enterprise to the private

sector. After privatizing something, the government

abdicates control of it.

Department of the Army pamphlet or DA Pam 5-

20 and AR 5-20 are the Armys publications implementing OMB A-76. As put forth by the Armys

assistant chief of staff for installation management

or ACSIM, they provide guidance for managing and

The privatization of

rotary wing training

Should the Army consider

privatizing its rotary wing

flight training program?
18 RM n1st Qtr 99

carrying out the Armys commercial activities

program. Specifically, the two documents establish

these controls over Army commercial activities or

CA policy:

identify standards for determining if an activity is

included in the program;

establish procedures for review of activities to

determine if they must be operated by government

personnel; and

provide instructions for studies to compare costs

of contract vs. in-house performance.

These regulatory requirements

identify two key policy elements to

apply when considering if an

activity is eligible for commercialization through outsourcing or

privatization. First, they recognize

that certain functions are inherently

governmental in nature, are so

intimately related to the public

interest as to mandate performance

only by federal employees, and as

such represent the governments

core competencies. The second

policy mandates that the government shall not start or carry on any activity to

provide a commercial product or service if the same

can be procured more economically from a commercial source (OMB A-76 Supplement p1-1). In other

words, non-core competency functions the government performs must be released to the private sector

if a commercial source can provide them more

efficiently.

The emphasis on commercialization

During the past decade, DoD has given considerable attention to increasing efficiencies of its noncore competency activities by outsourcing them.

Army efforts have traditionally targeted commercializing base operation activities. Examples include a

move to privatize utilities on military installations

and a recent proposal to outsource military housing

management at Fort Carson, Colo., and Fort Hood,

Texas.

Potential savings are present in more than base

operations. As the number of outsourceable activities increases, the more inherently governmental

many of them begin to appear. Debates arise over

what portion of an activity represents one of the

governments core competencies and what portion is

suitable for commercialization. One area in which

the line separating inherently governmental from

other activities is unclear, is Army institutional

training.

Rotary wing flight training

Few will dispute that the lethality demonstrated

by Apache helicopter units during the battles of

Desert Storm represents one of the Armys core

competencies. One can, however, look to civilian

flight training agencies and see that the same basic

skills that are required to fly an Apache are taught

outside the Army. Should DoD

consider privatizing of the Armys

basic rotary wing flight training?

If so, how much of the training

can, or should, be commercialized? Could the Army really

relinquish control of the program

to the civilian business sector?

To answer these questions, lets

break down rotary wing flight

training into its basic fundamental

activities, and then compare

outsourcing levels of these

activities among the United

States, United Kingdom and

Canadian helicopter training

programs. Well also look at how the University of

North Dakotas Air Battle Captain flight training

program compares with military flight training

programs. The emphasis of these comparisons is to

highlight the core competencies associated with

military helicopter flight training.

Flight training activities

Rotary wing training can be broken down into

several basic cost activity categories. These activities

generally apply to any helicopter training school.

Outsourcing levels at different training schools will

be compared in these categories: administration,

base operations, aircraft ownership, aircraft maintenance services, flight instruction training, classroom

training and flight-line training.

Administration of flight training programs refers

to which agency actually controls the rotary wing

training program, i.e., the agency, civilian or military, with responsibility for managing program

policy. Administrative policy includes such things as

participant selection process, academic curriculum

and school graduation requirements. Base operations

activities are the services that facilitate flight training, such as refueling contracts, maintenance of

airfields and upkeep of training facilities like classDoD has

given considerable attention

 to increasing

efficiencies of

its non-core

competency

activities by

outsourcing
RM n1st Qtr 99 19

rooms, gunnery ranges and hangars. Aircraft ownership recognizes which party in the training program

provides the actual aircraft used for flight. Aircraft

are generally either owned by the government or

provided by an agency under contract with the

government. Aircraft maintenance services include

scheduled, unscheduled and depot-level maintenance

procedures required for the helicopters.

Flight instruction is the actual academic and

hands-on training conducted

between instructors and students.

Instructors come in two types:

classroom instructors, who teach

flight-related academics like

aerodynamics, weather and flight

physiology away from the flight line

in fixed facilities, and flight-line

instructors, the so-called instructor

pilots who do hands-on flight

training of student pilots in the

aircraft. Instructors are categorized

by the separate instructional phases

they teach, i.e., primary flight

instruction, instrument flight

training, basic combat skills, night

and night vision goggle training,

gunnery training and advanced combat skill training.

For our purposes, we need consider only two overall

categories, basic flight skills and advanced flight

training.

U.S. DoD Helicopter Training

Since the Armed Forces first identified military

applications for aircraft, they have conducted inhouse fixed and rotary wing pilot training. Initially

the Army Air Corps maintained responsibility for

aviator training. After being redesignated as the Air

Force, the majority of fixed wing training became a

USAF responsibility. Rotary wing training and

operations, however, remained Army functions.

Today the Army and Air Force train rotary wing

aviators together at Fort Rucker, Ala., while Navy

and Marine Corps helicopter pilots receive training

at Naval Air Station Whiting in Pensacola, Fla. Our

focus here is on the Armys training program.

Army and Air Force Initial Entry Rotary Wing

Training

Fort Rucker has been home to Army aviation

since the Vietnam War era. Rucker is a DoD-funded,

Training and Doctrine Command or TRADOCcontrolled installation. It provides initial entry rotary

wing training to every Army and Air Force helicopter pilot. The school also provides advanced individual training to enlisted soldiers in aviation-related

military occupational specialties.

The Fort Rucker flight training program happens

through a mix of outsourced and in-house services.

Contractors are performing an increasing portion of

the training. Activities outsourced at Fort Rucker

include aircraft maintenance services, most of the

base operations and much of the flight instruction

training. Army civilian employees conduct classroom flight

training and basic flight skill

training. Active duty warrant

officer instructor pilots delivery

of advanced flight training is the

only military in-house activity,

and the Army owns the TH-67

training helicopters.

U.K. Defence Helicopter

Flying School

In 1992, as part of a private

finance initiative to reduce

government costs, Britains

chancellor of the treasury began a

program of transferring traditionally public responsibilities to the

private sector. Under this initiative, contractors use

private-sector capital to procure assets and infrastructure by which to provide services to the public

sector. The contractors stand to be rewarded for their

investment through government contracts to perform

and deliver the services. Underlying the public

finance initiatives are the principles that proposals

must represent good value for the money and that

risk must genuinely be transferred to a private sector

contractor.

An early public finance initiative was to provide

military helicopter training service through private

contractors. On April 1, 1997, the Defence Helicopter Flying School was formed to provide rotary-wing

training for all three branches of the United

Kingdoms armed forces. The school is revolutionary in British military training. Not only does the

school unite all helicopter flight training at one base,

but it also marks the beginning of commercial

operations among traditional military training

activities. Under the schools contract, FBS Limited

(a joint venture business formed just for this contract) is responsible for the provision and maintenance of the helicopter fleet and the majority of

ground school and support facilities at RAF

Army civilian

employees

conduct

classroom

 flight training

and basic

flight skill

training.
20 RM n1st Qtr 99

Shawbury, a British Air Force base (U.K. news

release 11/5/96 p1). Instructors for the program

come from both FBS and the British Defence

ministry.

The Canadian proposal

Canada began outsourcing functions of its air

training program in the early 1990s. Faced with

increasing budgetary pressures, the government in

1989 announced a plan to employ a civilian operator

to provide primary flying training and comprehensive training support services for the Canadian

forces. In September 1991, an all-Canadian contractor team led by Bombardier, Inc. won a five-year

flying training and support contract. It immediately

began converting a portion of the long-established

Canadian forces base at Portage la Prairie (now

known as the Southport Aerospace Center Inc.) into

a facility that would continue its tradition of providing high-quality military flying training, but in a

civilian environment.

The Canadians have moved incrementally toward

privatization. In July 1992, Bombardier, Inc. opened

the Canadian Aviation Training Center. The centers

original mandate was to provide comprehensive

support for high intensity multi-engine and basic

helicopter training programs for the Canadian forces.

Operational support included airfield maintenance,

aviation weather services, crash and fire rescue,

navigational aids maintenance and aircraft maintenance. Student support included housing, catering,

recreation and medical services.

In November 1997, the Canadian government

announced plans

for a $2 billion

contract with

Bombardier to

provide training

aircraft and flight

training services

for 20 years

(Pugliese 11/10/97

p1). Under this

contract Bombardier would continue providing

base support

services for the

Canadian training

program and also

provide training

aircraft. According to Canadian military officials,

the plan would save additional government money

by getting closer to a completely privatized flight

training program, and it would also strengthen

Ottawas bid for a new NATO flight training school

in Canada (Pugliese 5/5/97 p1).

This goal demonstrates an interesting twist to

outsourcing of military flight training. The Canadian

government is not only attempting to reduce its

training costs by taking steps to privatize its flight

training program. It is also allowing Bombardier, the

company that the program is being outsourced to, to

develop plans to provide flight training for pilots of

allied nations as well as for Canadian pilots. The

Canadian program is not yet completely privatized.

Canadian forces still provide training instructors, air

traffic control and management of the program. The

program does, however, appear to be on a course

toward eventual privatization.

Program comparison

As noted, the U.S. Army rotary wing training

program and those of the U.K. and Canada have all

implemented outsourcing to some extent. Each

government pursued outsourcing to reduce costs of

its program. The progressively greater level of

outsourcing in the Canadian flight training program

suggests that some day it may be completely privatized. The American and British programs incorporate outsourcing to achieve efficiencies in supporting

activities while maintaining significant military

presence in administrative and flight-line training

activities. Table 1 compares the three programs.

Table 1

U.S. U.K Canadian

Administration Military Military Military

Base Operations Outsourced Outsourced Outsourced

Aircraft

 Ownership Military Outsourced Outsourced

Aircraft

 Maintenance Outsourced Outsourced Outsourced

Flight Instruction

 · Classroom Outsourced Outsourced Outsourced

 · Flight Line Military & Civilian Military & Civilian Military & Civilian

Ultimate Goal Outsource Non-Core Outsource Non-Core Complete

Activities Activities Privatization

Comparison of U.S., U.K. and Canadian rotary wing training programs
RM n1st Qtr 99 21

Bibliography

AR 5-20 (1997, October 1) Management of

Commercial Activities Program U.S. Government Printing Office Circular No. A-76 (1983,

August 4) Performance of Commercial

Activities Executive Office of the President,

Office of Management and Budget

OFFP Policy Letter 92-1 (1992, September

23)Inherently Governmental Activities Office

of Federal Procurement Policy, U.S. Government Printing Office

Pugliese, David (1997, May 5) Canada

Pushes NATO Training Plan/Britain, Norway,

Denmark Indicate Interest in Joining Program

The Defense News, Army Times Publishing Co.

Pugliese, David (1997, November 10)

Canada Moves Toward Privatizing Air Training The Defense News, Army Times Publishing Co.

Supplement to OMB Circular A-76 U.S.

Government Printing Office; retrieved January

25, 1998 from http://www. whitehouse.gov/WH/

EOP/OMB/html/circulars/a076/076s1.htm

Rivera, Floyd G. (1997, January) University

of North Dakota (UND) Rotary-Wing Training

(RWT) Program Cost and Training Effectiveness

Analysis (CTEA) Department of the ArmyWhite Sands Missile Range Technical Report

UK MOD Press Release (1996, October 1)

Defense Helicopter Flying School Launched

U.K. Ministry of Defense News Release, No.

137/96

UK MOD Press Release (1996, November 5)

MOD Signs Flying School Contract U.K.

Ministry of Defense News Release, No. 147/96

About the Author

Karl Kraus was to be promoted to Major on

April 1, in his first functional area 45

(Comptroller) operational assignment,

with Third U.S. Army at Fort McPherson,

Ga., following graduation from the Army

Comptrollership Program at Syracuse

University in 1998, where he wrote this

article as his student paper. A University

of Iowa 1989 Bachelor of Arts graduate

and basic branch Army aviator, he serves

now as budget analyst for the Armys

Central Command, managing contingency

funding programs for Southwest Asia.

In the final installment in the next issue, the author

will expand the points below in developing observations, conclusions and recommendations for the

conduct of U.S. military helicopter pilot training. All

three countries programs are commercialized to

about the same extent. The fact that the three governments retain administrative control of their programs

suggests that they all see them as inherently governmental in nature. At the other extreme, each training

program outsources a majority of its basic activities

such as aircraft and facilities maintenance, training

support and classroom instruction. It can be concluded

that these activities represent common activities, not

core competencies, and are suitable for commercialization.

The actual ownership of the training aircraft and

the degree to which civilian instructor pilots are used

represent the areas of difference among the three

programs. Both the British and Canadian programs

utilize aircraft furnished by an independent contractor.

This suggests that outsourcing the ownership of the

aircraft may be a potential source of savings for the

Armys rotary wing training program. However, Fort

Ruckers program is much larger than the other two,

and there may be no commercial agency large enough

to provide this service.

Currently, a battalions worth of military instructor

pilots conduct combat skills training in the U.S. Army

rotary wing training program. All basic flight training

and a portion of the combat skills training is performed by Army civilian instructor pilots, most of

whom are retired Army aviators. By outsourcing the

remaining instructor positions in the Fort Rucker

program, the government could not only save money

but also return about 140 active duty instructor pilots

to the field.

Increased outsourcing of specific activities at the

Armys rotary wing training program is a possibility;

privatizing the program at Fort Rucker is not. The

complete function of the Armys flight training program cannot be sufficiently performed by any commercial enterprise. Administration of the militarys flight

training program, like command of military forces

itself, is inherently governmental in nature. For this

reason, it represents a responsibility that is not

suitable to be relinquished to the private sector no

matter what the cost.

In the next issue:
22 RM n1st Qtr 99

Last year was an economic

wonder year. Nowhere else in the

world than here has a nation

experienced market turbulence and

yet still enjoyed low interest rates,

higher incomes and increased

savings rates while keeping inflation low. The outlook for 1999

looks to be the same, except for one

small matter in the coming 4th

quarter, the issue we call Y2K,

Year Two Thousand.

Most have heard about Y2K and many know what

it is and what it can do if it is not corrected. What

most investors are not prepared for is the natural fear

within themselves, the fear of the unknown, the whatif factor of investing. Most investors are just common

everyday people trying to make a little extra cash.

These are the people who are going to make it very

big for those who have a true understanding of money

and markets during the Y2K time frame.

Will there be an economic disaster due to Y2K?

No, not really, but there will be market fluctuations

that will be sparked off not by institutional investors

or the experienced but by the common players who

fear they will lose it all if they stay in. These people

make up over 70 percent of the total market, and

when they pull out, the pickings will be outstanding.

In the 4th quarter of 1999, look for at least a 500-

point drop in the market (some estimates are as high

as 1500 points). The reason for the drop is that

investor confidence in the Y2K fix is low. Many

investors still believe that on Jan. 1, 2000, they will

check their bank accounts and find zero balances.

Many are following the doomsday investment

philosophy and planning to pull out and hold cash.

That means a likely temporary mass selloff will drive

stock prices down to a level where a simple $5,000 or

so investment could grow by 50 to 100 percent in just

a year.

The so-called blue-chip stocks are likely to drop 15

to 25 more, and small companies (micro-caps) will

take a heavy hit, but the real feast will take place in

those companies in the middle of the investment

spectrum and international stocks. When I mean hit, I

am not referring to corporate profits, I am referring to

stock prices, and that is literally where the money will

be. Many market newsletters are publicizing companies to look for during this time

frame, as well as international markets,

and these latter should not be dismissed.

As an example, Japan is now in a state

of economic turmoil, and many average

investors see this as a place not to be.

However, stop and look into the firms

whose stock has dropped from 25 to 50

percent. Have they disappeared? No! As a

matter of fact, they are still operating and

many are turning a profit. I myself own an

interest in two Japanese banks and have already made

a handsome sum. My point here is that Y2K, though

not the same as an economic bust, will have a similar

effect in the marketplace; and for a very short time 

about 6 months  an investor can pick at the carcasses of those who could not stomach the ride.

If you are concerned about waking up and finding

zero balances in your accounts, simply save your

statements for the next year. If there is a problem, you

have proof positive and firms will make the adjustment. Many are preparing to do so, even though they

have the fix in place. This year, 1999, promises to be

just as sporadic as 1998. For the rest of the year,

invest in increments if youre playing mutual funds. If

youre playing the open markets, find your peak and

low and stick to it (know your greed factor). Lastly,

start saving cash on the side for the 4th quarter drop,

and get set to jump in with both feet. You will see

opportunity clear as day, and you will not get another

opportunity quite like this for another millennium.

About the Author

Johnathan Hurwitz, a former enlisted infantryman and

now lieutenant in the Army Reserve on active duty, is

the finance and accounting officer and bank liaison

officer with the 1st Support Battalion, Multinational

Force and Observers in Sinai, Egypt. He has a

bachelors degree in business administration from

Creighton University. He was president and chief

executive officer of his own financial services and

investment consulting company before joining the

Army. Hurwitz is also author of Financial Planning:

Saving and Investing for Now and the Future, read

by more than 10,000 and published in condensed form

in RM, 4th Qtr 1997.

Y2K: Are your investments safe?

by 1st Lt. Johnathan M. Hurwitz
RM n1st Qtr 99 23

Human resource management is an integral component of Resource Management. If we manage

our people as though they were simply corporate

property, then tensions will increase as morale and

productivity sharply decrease. That paves the way

for a hostile office environmentwith arguments,

threats, vandalism and, ultimately, fights, injury and

possibly death.

Workplace violence is a national epidemic.

Modern technology, downsizing initiatives, reengineering efforts and privatization add stress to an

already tension-filled environment. Added pressure

is placed on management to expeditiously produce a

quality product. The stress and pressure in turn are

passed on to over-tasked and fatigued subordinates.

Such an environment regrettably becomes a

breeding ground for manipulative, petty bureaucratic

czars who use unsavory, antiquated tactics to force

subordinates to produce, or simply to do their

bidding. Unfortunately, in todays stress-filled

society, a Mr. Dithers type boss is unlikely to find

a passive Dagwood Bumstead to kick in the pants.

Instead, that kind of boss is likely to find a stressedout employee who is mad as h... and wont take it

anymore. Managers have a choice: become targets

and victims of office rage or become the facilitators

toward creating peaceful and safe working environments through open, two-way communication.

In the past, managers have used (and have gotten

away with using) devious tricks to intimidate

employees, express displeasure and play irritating

mind games. Today, such tactics are likely to

spark a violent reaction. I have developed the

Seven Dirty Diss of Mismanagement. Managers

should absolutely refrain from using these destructive tactics, which over time will ruin an

organizations credibility and can ultimately be

extremely hazardous to their health, safety and wellbeing, not to mention careers.

1. Dishonesty: A corporate body that permits

managers to lie to their employeesthrough either

words or actionsis asking for severe incidents of

workplace violence. Employees expect to be treated

as trusted professionals and colleagues. As such,

they want honest feedback and consistency in

applying corporate policies. Lying to employees is

paramount to stating that they are not mature (or

professional) enough to handle the truth. What a

slap in the face! Simply, lying to subordinates

implies that they cannot be trusted. Furthermore, an

office environment built on lies and deception

fertilizes the grapevine. Employees no longer trust

the formal chain of command (i.e., management) for

information. Instead, employees become dependent

on the informal channelssuch as the grapevine

for the real news, which is frequently transmitted

as harmful office gossip. Any organization built on a

foundation of deceit, misrepresentation and lies is

like a house of cardsa disturbance will cause it

to collapse. Managers who lie and mislead employees often find themselves the targets of retribution.

2. Distrust: Abraham Maslow placed security as a

basic need of subordinates in a workplace. Security manifests itself in trust. Subordinates literally

put their careers in the hands of management. They

trust that management will take care of their needs

for recognition, career progression, advanced

training opportunities and the like. A typical office

despot will corrupt this and (mis)use the trust

placed in their hands as a manipulative tool to

advance a personal agenda.

Bureaucratic manipulators are recognizable as

those who reward a select few by giving them the

recognition of permission to attend career-enhancing

training. The manipulative manager depends on

cliques and tends to categorize employees as being

either with or against the boss. There is no room

for neutrals. Such managers seem to feel no regret,

for instance, about letting an unfavored

employees CP 11 ACCES package gather dust in

the in-box, or take no action on a training request.

Manipulative managers may use human emotions

to swindle and con employees into doing their

bidding for them. Their language is full of popular

clichés and jargon, including expressions such as,

Its me and you, or, Youre my horse, and Ill

 is mismanagement

by John Di Genio

Dis
24 RM n1st Qtr 99

take good care of you, or, Youre all that I have,

or, Ill go to the grave fighting for you. A manipulator cannot [and should not] be trusted. Any

benefits gained by co-operating with a manipulator are extremely limited and temporary. Once an

abusive manipulator uses an employee for personal

gain, the employee is usually unceremoniously

discarded like yesterdays newspaper.

The Dallas character J.R. Ewing is a classic

example of a manipulator. I have found that an

organization that refers to itself as a

family (instead of a team) often

has a manipulator at the helm.

Remember, a family infers that

there is a controlling, omnipotent

Parent figure pulling all the

strings. Of course, when the manipulator pulls the strings one too

many times, the employee usually

responds with a violent reaction

(think of all the times J.R. was

struckOuch!).

3. Disrespect: Managers demand

that subordinates treat them with the

respect due their position in the

organization. However, respect is a two-way street.

In offices run by bureaucratic czars, tyrannical

managers still believe they have the absolute authority to speak to subordinates in a condescending

manner and tone, use rough hand gestures such as

pointing, and, in many instances, use offensive

expressions. Consequently, these office despots

develop a contemptuous, pompous attitude toward

their subordinates, much like a king of old. Subordinates find this demeaning, annoying and downright

disrespectful. As such, this practice often sparks

complaints and grievances and eventually it causes

tempers to flare and erupt as violent actions.

 Managers may confuse respect with fear.

Petty micro-managers tyrannically use fear and

intimidation (e.g., a poor performance rating,

denying an overseas tour extension) to influence and

control subordinates. However, as Aleksandr

Solzhenitsyn accurately pointed out, once the basis

of the fear has been removed, the person employing the fear no longer has any control over the

subjugated. Fear is temporary; it doesnt last.

Respect is perennial. Respect causes subordinates to legitimatize the managers authority to

direct, guide, supervise and control them. An office

tyrant never enjoys this kind of legitimacy; such a

person never has it (since organizational tyrants are

never respected). Instead, the office czar is like a

mob boss, and, like any gangster, has to keep

looking behind for enemies.

4. Disintegrate: Employees expect their supervisors

and managers to be knowledgeable, competent and

effective leaders. As such, leaders should be able to

build strong, lasting, cohesive teams of professionals

who can take on any task and accomplish the

mission at hand. However, inept

managers tend to shy away from

building such teams. Instead, they

prefer to assemble less knowledgeable, junior graded people to

work for them because inept

managers are threatened by

employees who know as much as

(or more than) they do. They are

also threatened by a teams

cohesiveness. Strong esprit de

corps within a team is a threat to

the supervisors absolute authority. For this reason inept, pettybureaucratic czars feverishly

work to replace gifted and talented team members

with lesser-qualified and perhaps incompetent,

lackeys. Disintegrating a workable team adds undue

stress to the remaining members and the teambuilding process has to begin all over. There is

added tension when remaining team members

become uncomfortable working with less knowledgeable people who are among the bosss chosen

few. The feelings of frustration, disillusion and

anger are increased when a disintegrator disrupts

the working relationship of a firmly established

team. A routine like this often builds an office

environment receptive to incidents of workplace

violence.

5. Disinterest: Abusive managers typically are

interested only in nurturing their own careers and

tend to focus on people and items that can help them

professionally or socially. Other daily office business matters are typically seen as must-do annoyances and inconveniences. Often such business

matters concern subordinates wellbeing. Managers

in this category often dont listen attentively to what

an employee is trying to communicate, but instead

will continue to pound away at a keyboard, read a

newspaper, yawn, or constantly look at the clock on

Disintegrating a

workable team

adds undue

stress to the remaining members

and the teambuilding process

has to begin all

over.
RM n1st Qtr 99 25

the wall, conveying to the subordinate a lack of

interest. Worse yet, the employee may get the

feeling that the manager simply doesnt care. Open,

two-way communication is key to diffusing a

potentially serious [violent] situation. Managers not

interested or who seem bothered by listening to what

employees have to say will frequently find themselves in a hostile, confrontational situation. Disinterest fuels the violent fire of discontent.

6 Disloyalty: Loyalty is the basic foundation of any

organization. Without loyalty, the

entity will disintegrate and disappear. Managers at every level

demand and expect fidelity,

allegiance and devoted, unswerving

loyalty to the organizations

philosophy, traditions, ideals and

customs from their subordinates.

Unfortunately, office dictators

fatuously believe that their loyalty

extends only to superiors and not to

subordinates. Bosses disloyal to

their subordinates can usually be

found blaming subordinates for less

than desirable outcomes. They

often take credit for successes

while blaming others (often subordinates) for

shortcomings or outcomes with less than desirable

results. Offices headed by supervisors disloyal to

their subordinates typically have high employee

turnover with long periods of hire-lag (vacant

positions). Another tell-tale sign is extensive

memorandum for record folders documenting

controversial incidents.

7 Dis-secretive: A favorite pastime of petty bureaucratic czars playing head-games with subordinates is

the withholding of information. Dis-secretive

managers foolishly perceive power and self-importance through acquiring key office secrets. As

such, they tend to overestimate and excessively

elevate their own importance or position in the

pecking order within the organization. In reality,

with todays advanced electronic technology, the

supposed secrets these managers try to keep often

escape through the informal organization moments

after (or before!) the manager knows of them.

 Petty bureaucratic bosses use dis-secretive

behavior to pompously and aloofly drop hints and

pass innuendoes about an adverse [personnel] action

to distance themselves from any type of employee

repercussion. These managers often speak just above

a whisper, within earshot of a targeted employee, to

make antagonistic comments about the employees

career in the organization, performance rating, tour

extension, and so on, as a means to cowardly and

impersonally relay displeasure or controversial

information.

 These despots have an insatiable hunger for

information; they regularly use informants to keep

them updated on the latest rumblings and grumblings

within the organization. Consequently, dis-secretive managers

share very limited information

with only a chosen few, since, in

their minds, information is power.

 These pusillanimous, megalomaniacal managers polarize a

workplace into bickering factions.

Eventually, employees tire of such

head-games. Worse yet, for the

dis-secretive manager, employees may seek revenge by transmitting dis-information through

informal channelsin hopes the

office despot may become embarrassed by presenting such phony

information as fact in formal settings. A workforce

that has internal strife, passes dis-information

through networks, has incompetent individuals in

leadership positions and is ready to lash out at the

boss is very likely to have violent confrontations.

 Practicing the Seven Dirty Diss of Mismanagement is a sure way to shorten a managers career.

Additionally, behaving like a J.R. Ewing, Ebenezer

Scrooge or Mr. Dithers may often cause employees

to react violently. Managers need to realize that

there are costs to being an abusive, petty, bureaucratic czar: high employee turnover, low productivity, administrative complaints and grievances,

litigation, poor morale and the constant threat of a

violent episode in the workplace. Managers have the

ability to diffuse violent situations through confidential, frank discussions. Attentive listening and open

dialog with subordinates are effective means for

nipping workplace violence in the bud.

. . . dis-secretive managers

share very

limited information with only a

chosen few,

since, in their

minds, information is power.

About the Author

John Di Genio, a prior contributor to RM, is a Program

Analyst with U.S. Forces, Korea and Eighth U.S.

Army. He writes frequently on work place issues.
26 RM n1st Qtr 99

Strategic movement. During any

deployment, the major cause or

driver of cost is moving people

and equipment. The model estimates movement costs based on

equipment short tons and passengers. These elements give needed

information to identify an economic mix of aircraft. Each

aircraft type has a unique cost

based on actual operating hours.

Entering the number of aircraft by

type and operating hours allows

the model to provide a cost

estimate for moving equipment

and personnel. This includes

operating costs originating from

the initial departure point of the

aircraft to its final destination. We

used an estimate of 50 hours per

aircraft (in effect, a round trip).

Civilian air cost is a second

component of the air costs. Costs

are based on a contract-quoted rate

that is published annually by

TRANSCOM. During the

operations sustainment phase, we

estimated the costs of the air

movement of cargo resupply costs.

This may also extend to sea

movement costs.

Direct OPTEMPO costs drive the

sustainment phase costs. Direct

OPTEMPO refers to costs of

ground and air operations and is

measured respectively in miles and

flying hours. Using historical

training cost data from CEAC, the

model provides a cost per mile/

hour for each type of Army ground

and air unit (from an entire brigade

to an individual piece of equipWe developed this concept to lend

a structure to RM operations

during the contingency. These

procedures worked especially well

when time was short and we had to

satisfy immediate needs of both

the deployed troops and our higher

headquartersin this case U.S.

Army Forces Command or

FORSCOM. We based the concept

on three RM tools: a contingency

phased operating tempo or

OPTEMPO model, a budget

template and a standardized

accounting and reporting structure.

These tools proved beneficial to

the office during the deployment.

We were fortunate to be able to

assess the concepts viability

during last years Bright Star 98

exercise in Egypt and in local

internally generated exercises.

Contingency phased

OPTEMPO model

This first of our three RM tools

we used to establish the initial cost

estimate. The model subdivides

into three categories, strategic

movement, direct operating tempo

and indirect operating tempo. Cost

data came from several sources:

planning factors for aircraft use

from U.S. Transportation Command or TRANSCOM, estimates

for ground units from U.S. Army

Cost and Economic Analysis

Center or CEAC and actual experience in the area of responsibility

from similar situations. This model

affords the field RM a tool to

estimate operating costs throughout an entire military operation.

Three pillars of RM success in

contingency operations

The Third U.S. Army and U.S.

Army Central Command Comptroller office recently exercised its

capability to support a real world

contingency operation. During

operation Desert Thunder, members from Third Army deployed

from Fort McPherson, Ga., to a

hastily established headquarters at

Camp Doha, in Kuwait. The mission was simple: establish an

Army headquarters that could

accept ground forces and conduct

ground operations as directed by

the U.S. Central Command. As the

mission evolved, Third Army

headquarters became the nucleus

for forming a combined, joint task

force. The comptroller mission

was to manage contingency resources in support of deployed

U.S. ground forces.

A contingency operation is by

far the most challenging thing a

military RM gets to do. The

standard tools for comptrollers to

conduct a deliberate financial

resource process are not easily

adapted to contingency operations.

Just the same, warfighting resource managers must develop

cost estimates, budget and allocate

major command or MACOMprovided funds, and execute the

budget in an extremely condensed

and emotionally charged time

frame.

Prior to Desert Thunder, the

U.S. Army Central Command

Comptroller office developed an

RM concept to identify operational costs for deploying units.

by Maj. Mike Scudder and Maj. Scott Basnet

and Capt. Patrick Lamb and Capt. David LaCasse
RM n1st Qtr 99 27

ment). The calculation multiplies

the estimated operating miles and

air flight hours by a cost factor

established for each type unit.

Initially we estimated a monthly

operating tempo of 200 miles for

4 months and flying hours of 25

hours per aircraft (eventually

reduced to 17 hours). Given that

the baseline cost estimates were

for domestic U.S. training conditions, we applied a cost differential

to account for unique environmental conditions that increased or

decreased equipment wear and

thus actual operating costs.

Identifying and applying a cost

differential is admittedly an art.

We initially applied factors for

ground and air operations and

modified these factors during

subsequent budget updates to

FORSCOM.

Indirect OPTEMPO is the third

component of the first tool. The

costs of maintaining the force

stretch across every operating

phase. The model captures indirect

OPTEMPO by commodity. Our

commodity categoriesengineer

support, transportation, general

supplies, contract services, medical support, force protection,

environment and civilian labor

closely follow those established by

FORSCOMs contingency cell,

and that has simplified our reporting requirements to them. Using

past historical cost data (based on

actual costs for task forces deployed in operation Intrinsic

Action), each commodity is costed

per soldier per day. The sum of the

daily costs by commodity yields

the total daily cost per soldier.

Using the common cost-persoldier-per-day factor in the model

enables an RM to provide quick

estimates based on operating days

and personnel. The estimates are

unique to each contingency

operation and will vary depending

on host nation support agreements.

We are fortunate in Kuwait to

have a strong support agreement,

which reduces total operating

costs.

Budget template

This second of our three major

tools standardizes budget format

for submitting requirements up the

chain and for use by our subordinate units. Contrary to popular

notion, funds are limited and

controlled during contingency

operations. Higher headquarters

requires estimates for resources

they need to find and provide.

During Desert Thunder, the U.S.

Army Central Command

Comptrollers ability to consolidate, validate and lay out mission

requirements with available

resources to the task force commander and to FORSCOM depended on our ability to quickly

define necessary funding data. The

budget template was our key to

doing so. Here is how it worked:

s User friendly format. The

template uses Microsoft Excel

spreadsheet software. The format

design allowed us to clearly align

user commodities to submissions.

We also worked hard to express

accounting jargon in simple words.

s Easy data entry. In the template design we used data fields

that were easy to understand and

simple to use yet still displayed indepth functional information

clearly and concisely.

s Commodity delineated

requirements. We designed the

template from previous deployment experience, principally on

Bright Star 98. We also subdivided some commodity categories

into subcategories, consistent with

past operations. We aligned the

subcategories to major staff proponents who then became responsible for validating major parts of

the budget, i.e., communications,

engineer projects and automation

requirements. The categories became a staff action officer checklist, which simplified resource

programming. The goal was to

develop a common application that

could cover the entire spectrum

from peace to war. The budget

template enabled us to standardize

operations, train as we fight, create

efficiencies and thereby simplify

the whole operation.

Standardized accounting and

reporting structure.

This final of the three tools

aligns each commodity to the

financial systems. Having completed the budget estimate and

allocated funds, we had next to

capture and record fund obligations. For that event, prior to

deployment we designed an easyto-use accounting system that

could track commitments and

obligations to simplify our reporting requirements. We took care in

the design to make it flexible,

adaptable and supportive for both

the RM and the war-fighter. To do

that, the system had to:

s Permit modifications, given the

unknowns of contingency operations.

The goal was

to develop a

common application that could

cover the

entire spectrum

from peace

to war.
28 RM n1st Qtr 99

s Make sense to the operator. We

had to steer clear of phrases like

MDEPs and AMS codes

when briefing commanders, and

express these and other esoteric

RM terms in language they

understood.

s Meet reporting requirements.

Our accounting structure and other

tools aligned with FORSCOMs

reporting categories, allowing

quick and accurate reporting to the

commanders of U.S. Army Central

Command, FORSCOM and U.S.

Central Command.

s Align with the Budget Subcategories, i.e., strategic movement

and direct and indirect

OPTEMPO. Validation of the

model was important, and the

accounting structure supported the

cost reporting based on the

models major categories.

s Be easy to use. Fast reporting is

a result of steady and deliberate

work. Being able to give attention

to detail while remaining focused

on our structured plan has allowed

decision-makers to make informed

RM decisions.

The three RM tools for contingency operationscontingencyphased OPTEMPO model, budget

template and standardized accounting and reporting structure,

were instrumental in our great

resource success during Desert

Thunder. They continue as available and usable RM tools for any

subsequent contingency operation.

When applied effectively, the tools

provide a field RM the means to

succeed in the most challenging

military operational environment.

In the 4th Qtr 98 RM issue (p.16) we described the concept of the multi-dimensional financial

analyst. Today, comptroller careerists are finding themselves required to be skilled in more than just

their main functional area. We must be multi-functional and multi-dimensional, capable of analyzing

and handling various situations. The Army Comptroller Proponency Office is spearheading the

development of the multi-disciplined financial analyst program which will encompass the design of a

career model including training, education, experience, professional development and accreditation at

various levels of ones career.

This program is being developed in a two pronged approach; first for the new Army careerist and

later, for members of the current workforce. To date, core competencies with associated sample

formal training to help achieve these competencies have been drafted. These competencies are based

on the Joint Financial Management Improvement Program, DoD and Army core competencies and

are being staffed with all levels of the Army financial management community from headquarters to

installations. In the near future, these competencies will be available for comment on the Army

Comptroller Proponency home page. The next step is to design the career path beginning with GS-5

through senior executive, delineating the types of training, experiences and education required at the

various stages of ones career to receive accreditation.

The financial analyst project team recently met with private industry experts from Xerox, IBM,

JCPenney and Chase Manhattan to examine their best practices in this area. Many large corporations

ensure their employees are multi-faceted by exposing them to myriad different experiences and

training. We are looking to learn from them the pros and cons of their experience. Also, we will begin

a series of visits to some RM offices to share our concept and get input from current careerists.

If any individuals or offices are currently organized under a multi-disciplined financial analyst

concept, we would like to hear from you. For further information or suggestions on this project please

contact: Ms. JoAnn Van Beusichem,DSN 227-1985, (703) 697-1985, email vanbejo@hqda.army.mil

or Mr. Bill Guillaume DSN 227-1983, (703) 697-1983, email guillwj@hqda.army.mil. Periodic

updates on the progress of the financial analyst concept will be posted to the Army Comptroller

Proponency Home Page (www.asafm.army.mil) and in subsequent editions of this publication.

Multi-disciplined Financial Analyst Program update

About the Authors

All four officers are assigned to the

Third Army/U.S. Army Central

Command Comptroller office at Fort

McPherson, Ga. This article is a

result of their recent deployment to

Kuwait for operation Desert Thunder.
RM n1st Qtr 99 29

The Armys Resource Management Annual Awards Program

made public some of the finest

Army stewardship achievements in

fiscal year 1998 from field and

staff resource managers. Competition was announced last August

for recognition of the years most

noteworthy accomplishments in

each of several civilian and

military RM categories for organizations, teams and individuals.

Senior subject-matter expert

panels evaluated the award

nominations by category. Topranked individuals then competed

for the capstone individual awards:

the ASA (FM&C) civilian award,

the ASA (FM&C) military award

and functional chief representative

special award. The program

features awards at two levels,

major command and above and

below major command.

Honorable Helen T. McCoy,

Assistant Secretary of the Army

for Financial Management and

Comptroller, recently announced

these 1998 award recipients:

ASA(FM&C) Civilian

Eula L. Jeannie Gray of the

Armys Special Operations

Command, capped 5 years as the

160th Special Operations Aviation

Regiments deputy comptroller

with a year of outstanding contributions. She excelled in leading a

seamless 6-month transition of

regiment finance and accounting

records to a new operating location

in Rome, N.Y. She gained special

recognition from Defense Finance

and Accounting Service by

becoming the only below-majorcommand RM given direct access

to its databased Accounting

Reconciliation System or dARS.

Her oversight of complex funding

programs such as the regiments

unique flying hour program, and

an impressive record of turn-in

credits for depot-level repairable

and intensively managed aviation

items, saved the command millions of dollars. The savings traced

directly to Grays expert and loyal

performance of duty.

ASA(FM&C) Military

SSgt. Donna M. Laverdure,

White House Communications

Agency, Washington, set new

standards as a role model of Army

professional and physical excellence. Her six soldiers provide pay

and travel support to the 850

people who keep the president,

vice president and First Lady

wired everywhere in the world.

They processed 5,000 travel

vouchers for $5 million, 99.9

percent right, handled 4,000

military transactions, 99 percent

right, issued $650,000 in airline

tickets and disbursed $540,000 in

travelers checks with no losses.

Laverdure consolidated agency

credit accounts from 17 to 4,

launched a travel voucher tracking

system that cut process time and

inquiries by more than half, and

set up first-of-their kind joint

service pay and one-stop travel

service offices. She also scored a

near max on the Army physical

fitness test and her peers inducted

her into the agencys elite all-star

team.

Functional Chief Representative Special Award

Jeffrey E. Hannahs of the Army

Fiscal Year 1998 Resource

Management Award Recipients

by Michael G. Mowry

Audit Agencys Fort Meade, Md.,

field office merited special recognition in supporting the Comptroller Civilian Career Program, CP11, for the thorough, scholarly and

detailed survey he led to assess

accuracy of the careerist personnel

database. Using sophisticated

sampling techniques and mobilizing intermediate command support

for the effort, he achieved a high

rate of reliable responses. Hannahs

arrayed his data in graphic displays that pinpointed error densities, provided normalized comparisons with the general population

and most importantly made sense

to senior decision-makers. The

FCR hailed his report as the best

handle we had ever had on the

career program database and used

the results to foster a massive

clean-up project.

Outstanding RM Organization (major command and

above)

The Army Materiel Commands

finance and accounting division in

Alexandria, Va., surpassed AMCs

own goal of setting the Army

standard for control of travel card

delinquencies. By using command-level rebates to supplement

subordinate activities travel

programs, this 12-person team

motivated AMCs 15 separate

commands and agencies to cut

delinquent dollars by over onethird and attain a new Army-low

delinquency rate of less than onethird the Army average.

Outstanding RM Organization (below major command)

Directorate of RM at the

Armys Aviation Center at Fort
30 RM n1st Qtr 99

Rucker, Ala., stripped down 12

percent more beyond 44 percent

workforce cuts since 1990, to

compete effectively in a labor

source decision and still carry out

its entire organizational mission.

They developed and used an

effective full-time equivalent

forecasting model to minimize hire

lag, maximize available end

strength utilization and execute at

99 percent. They increased aircraft

repair shop capacity to fully

exploit the flying hour program

and reduce contract aircraft

maintenance cost by 12 percent.

They cut travel-card delinquencies

40 percent, returned $30 million in

overall savings to their parent

TRADOC and trained up in

several new systems, networks and

softwareall despite moving the

entire directorate to a new building

at midyear.

Outstanding RM Team (major

command and above)

An Army Audit Agency team

from Alexandria, Va., to audit

Corps of Engineers financial

statements used a revolutionary

whole-system test rather than

statistical sampling, to show that

the Corps FM system, could in

fact produce auditable annual

statements. The team selected

Corps Southwestern Division

statements as a representative

portion, showed that much appeared auditable, and then aggressively and widely publicized the

results. By building rank-and-file

confidence that the Corps goal of

an unqualified (clean) report

was feasible, the team won client

trust at all levels. That sped up and

broadened their access to data,

strengthened their audit results,

gained favorable attention from

DoD and the General Accounting

Office and set the example for a

similar Navy audit of Marine

Corps financial data.

Outstanding RM Team (below

major command)

The Special Operations Support

Command RM office of the

Armys Special Operations

Command at Fort Bragg, N.C.,

came of age after three years

since stand-up, establishing a

comprehensive budget execution

tracking process and an aggressive

strategic investment plan. The

office successfully marketed a $2-

1/2 million unfinanced operating

requirements petition, and it won

permission to invest an additional

$1.6 million in commercial, offthe-shelf signal equipment that

made possible $2.4 million, or half

again as much, in turn-in credits.

RM Author of the Year

(below major command)

William Washington with

AMCs Communications and

Electronics Command at Fort

Monmouth, N.J., won the annual

Defense Cost Analysis Symposiums best paper award in

February 1998 for Subcontracting

as a Solution not a Problem in

Outsourcing. His report, DTIC

number AD-A333888, explained

how taking responsibility for what

used to be subcontracted functions

(i.e., being ones own prime

contractor) can reduce program

costs and improve performance

and customer satisfaction. He

advocated applying the subcontracting successes of several large

American corporations to the

government outsourcing process.

Civilian Comptroller

(below major command)

Eula L. Jeannie Gray won the

ASA(FM&C) Civilian Award for

her accomplishments in this

category, described above.

Civilian Analysis and Evaluation (major command and

above)

Elizabeth K. Manners, with the

Army headquarters program

analysis and evaluation directorate, distinguished herself as a

practical RM negotiator and expert

consensus builder. As Army

coordinator for a Defense Management Council overseeing implementation of defense reform

initiatives, Manners spotted

resource issues early, coaxed

willing support from diverse

interest groups and successfully

advanced the Armys interest in all

but two of 61 dif-ferent issues. Her

results set new standards for

effective staff work.

Civilian Analysis and Evaluation (below major command)

Berneta L. Dupree, with AMCs

Communications and Electronics

Command at Fort Monmouth, N.J.,

vastly improved the methodology

for estimating cost and risk of

developing a joint-service night

vision infrared sensor weapon. Her

estimate of cost at completion was

adopted as the joint program

position and sent forward. Air

Force and Navy participants now

use her costing methods. The

results are a uniform costing

approach, clearer understanding of

the performance data and tighter

control over cost growth in this

high-risk program.

Civilian RM (major command

and above)

Wanda M. Brewster of the

Armys Special Operations Command at Fort Bragg, N.C., provided valuable RM support for the

largest element of the commands

deploying forces. The processing

of temporary transfer orders, travel

orders, supply requisitions and

equipment proved a substantial

and formidable workload.

Brewsters thorough and patient

coordination among organic staff

elements, overseas operations

officers and deploying forces

made possible a flawless execution

of the mission. Superior tech-
RM n1st Qtr 99 31

niques she developed for budgeting, monitoring and processing of

expenditures reduced initial

requirements $200,000, cut

obligations 25 percent from those

of the previous rotating force, and

now serve as the standard method

for supporting deploying forces.

Civilian RM (below major

command)

Sandra Babb in the Fort

Benning, Ga., RM directorate, set

a new standard for excellence in

manpower management as chief of

a 3-analyst team. In 1998 she was

primary contact for several of the

most significant manpower

reductions to hit the installation in

years. Her detailed analyses and

incisive recommendations on how

and where to take reductions with

least impact vastly improved the

quality of command group decisions. Her sharp pinpointing of

position coding errors substantially

reduced the number of authorizations subject to scrutiny. Babbs

competent vigilance helped

preserve Fort Bennings authorized strength and so its mission

capability.

Civilian RM in an Acquisition

Environment (below major

command)

Karen Kunkler of AMCs Tank

and Automotive Command in

Warren, Mich., improved the

quality and verifiability of costsaving data for the Supply Management, Army Operations and

Support Cost Reduction program.

Her system provided for

identifying parts information

sources, field supply demand rates

and end-item densities and for

identifying, analyzing and tracking

factors affecting cost. Her largely

homegrown and tested automated

application won support and

approval from the AMC senior

leadership and is being implemented on a command-wide basis.

Civilian Education, Training

and Career Development

(major command and above)

Stephen T. Bagby of the

Armys Cost and Economic

Analysis Center in Falls Church,

Va., developed and attractively

presented imaginative Army cost

management doctrine and training

material in furtherance of the

Government Performance and

Results Act. Working with a

renowned contract instructor,

Bagby produced a program of selftaught instruction on compact

disks in how to become a cost

warrior. Advancing the notion

that measurement, management

and reduction of costs is everybody job, Bagbys CD program

has reached 5,000 Army resource,

installation, operational and

financial managers and is a staple

of the orientation course for new

Army installation and garrison

commanders.

Civilian Accounting and

Finance (major command

and above)

Juan Dejesus of the Armys

Finance Command in Orlando,

Fla., as Army headquarters contact

for the Defense Civilian Pay

System, expertly coordinated and

oversaw conversion of 244,000

employee accounts Army-wide to

the new system. He successfully

resolved numerous thorny issues

peculiar to overseas locations by

effectively educating and garnering support from senior leaders.

As a result, the new system was

put in place with a minimum of

customer problems.

As stored-value or smart personal money card contact, Dejesus

distinguished himself as an

outside-the-box problem solver in

establishing the Army as defense

leader in implementing this new

personal finance program for

soldier recruits. His actions

enhanced Army quality of life

among civilians and soldiers,

bringing to bear a more responsive, efficient and effective pay

system.

Civilian Accounting and

Finance (below major command)

Sherry G. McCoy of the

Armys Signal Command at Fort

Huachuca, Ariz., developed and

presided over an effective transition of finance and accounting

support to a California operating

location that was noteworthy for

its friendliness and cooperation.

McCoys set of six quantitative

and easily measured performance

indicators was proactive in catching warning signs before they

became big problems. As a result,

after-the-fact confrontations

between her command and the

Defense Finance and Accounting

Service disappeared; trust and

confidence returned; and the

parent Forces Command was so

impressed they planned to use the

process at other operating locations. McCoys work earned her

an Employee of the Quarter honor

and a Commanders Award for

Civilian Service.

Civilian Budgeting (major

command and above)

Rosemary Thompson of the

Armys Special Operations

Command at Fort Bragg, N.C.,

turned an end-of-97 command

supply support activity account

deficit of 3/4 million into a 3/5

million surplus a year later. As

team leader of the local standard

Army retail supply system management cell, she devised innovative processes that overcame what

had been regarded as insurmountable procedural impasses and got

the system to work right. The

result was a $1.4 million positive

value change in the command

supply accounts value, wrought
32 RM n1st Qtr 99

through a pervasive problem

correction assault which averted

catastrophic lapses in RM support

to the command. Thompson also

played a major role in

transitioning the commands

finance and accounting support to

a remote operating location.

Civilian Budgeting (below

major command)

Stanley D. Payne, Fort

McClellan, Ala., budget officer,

turned a developing catastrophic

fiscal failure into his parent

commands TRADOC most

notable installation budgetary

achievement for the year. Unable

to replace the senior one-fourth of

his budget staff who had left,

Payne stayed the course, applying

exceptional knowledge and

initiative. He recycled a million

dollars in dormant and unused

funds, recouped another $1.6

million in savings, averted

Antideficiency Act violations and

scored 100 percent utilization in

each of 12 separate single-year

accounts. His fiscal heroics turned

imminent failure into what his

command called its best budget

story.

Civilian Auditing (major

command and above)

Gregory A. Procopi, an audit

supervisor with the Army Europe

Internal Review and Compliance

Office in Germany, identified

over $5 million in agreed command monetary benefits from his

staffs 37 audit recommendations.

He wrought extraordinary productivity from his seven staff auditors

through innovative audit manager

instructions, continuous training

and mentoring and an objectivefocused milestone tracking

system. His audit work in real

property maintenance accounts so

impressed the Director of Public

Works that he invited Procopi to

speak at their annual conference.

Through his significant accomplishments, Procopi renewed trust

and confidence in the auditing

profession and measurably advanced the cause of public stewardship.

Civilian Auditing (below

major command)

John E. Riley of the Army

Materiel Commands Communications and Electronics Command at

Fort Monmouth, N.J., serving as

the Y2K coordinator for all of

AMC, advanced the command a

quantum leap toward total compliance. Following methods, guidance and instructions from senior

audit agencies, Riley devised a

command-wide program for

quality-checking all manner of

hardware and software everywhere

throughout AMC to be sure no

computer or program would

interpret the year 2000 as the year

1900. AMCs chief Auditor hailed

Rileys major role toward getting

Internal Review and Audit Compliance into the forefront of Y2K

compliance efforts. His single,

standard infrastructure audit

program ensured command

uniformity and greatly assisted

AMC business system leaders

pursuing complete compliance.

Civilian Cost Analysis (major

command and above)

Edward F. Glavan, Jr. of Army

European headquarters earned

high praise from defense acquisition officials for a mathematical

model he developed to quantify

the dollar value of individual

logistical support being provided

by the military to American

contractors in Germany. Individual

logistical support will soon no

longer be allowed by the status of

forces agreement. Others had tried

but not ever succeeded in devising

a consistent, reliable and defensible method for calculating the

per capita cost and value of such

support. Using data from 60

German organizations to evaluate

23 categories of support furnished

1,000 U.S. contractors, Glavin

showed the cost per individual to

be 23 to 29 percent less than the

current Army estimate. That is a

potential annual saving in additional contract costs of $6 to $11

million, depending on the Euro/

dollar exchange rate.

Military Comptroller/RM

(below major command)

Capt. Shawn Bergquist of the

75th Ranger Regiment at Fort

Benning, Ga., ran practically a

one-person RM shop to support

the whole regiment and its commander. With one non-finance

enlisted soldier as assistant,

Bergquist performed virtually the

full range of field comptrollership

and RM activities, tasks and

document submissions usually

done by a half-dozen professionals. He designed and implemented

a unique automated travel control

system which electronically

generates requests for orders,

submits settlement vouchers and

significantly improves accuracy

and control. He won respect and

influence by giving the regimental

commander straight, frank and

accurate financial management

advice. He proved adept at justifying and executing additional funds

for unfinanced requirements and at

solving vexing resource problems

through ingenious analysis.

Military Analysis and Evaluation (below major command)

1st Lt. Jennifer A. Sinclair of the

Army Reserve Commands 94th

Regional Support Command at

Fort Devens, Mass., found a way

to pay charged airline ticket bills

twice as fast by having her own

support command do it instead of

Defense Finance and Accounting

Service. Bills were paid in less

than 30 days as opposed to the 58
RM n1st Qtr 99 33

it was taking before. Her comprehensive yet easily understood

procedures preserved billing

verification and internal controls,

speeded up disbursement and

obligation adjustments and

substantially raised fund

reutilization and end-of-year

execution. The parent U.S. Army

Reserve Command enthusiastically endorsed Sinclairs procedures for use by its other regional

support commands.

Military RM (major command

and above)

Capt. Thomas J. Barsalou of the

Armys Special Operations

Command at Fort Bragg, N.C.,

designed a computer-screen

mouse-click menu to give staff

members throughout the command

convenient network access,

through a single source, to information on travel policy, precedent,

forms and regulations. The data

includes per diem rates, how to

complete order and settlement

vouchers, the forms for order and

settlement vouchers and points of

contact for status checks.

Barsalous convenient and userfriendly application has eliminated

the need for soldiers and employees to search the internet for

required travel information and

has generated an estimated 10

workyears saved per year in time,

effort and frustration.

Military RM (below major

command)

SSgt. Leonard S. Rafanan, of

the 7th Special Forces Group at

Fort Bragg, N.C., distinguished

himself again last year as the

groups budget noncommissioned

officer in charge. As acting group

comptroller during a joint training

exercise among U.S. and Puerto

Rican units, Rafanan gained

command recognition for his

competent RM advice and outstanding achievement while

fulfilling an officer role. Following

the exercise, he professionally and

tactfully oriented the new group

comptroller officer. Finally,

despite the upheavals of an

unexpected half-million dollar

budget cut and the transition of

finance and accounting support to

a distant operating location,

Rafanan led the rest of the parent

Special Operations Commands

groups in successfully closing the

fiscal 1998 budget.

Military Accounting and

Finance (major command

and above)

SSgt. Donna M. Laverdure won

the ASA(FM&C) Military Award

for her accomplishments in this

category, described above.

Military Accounting and

Finance (below major command)

Maj. Quinton Fulgham of the

Army Reserve Command at Fort

McPherson, Ga., was exemplary in

successfully implementing the

standard Army retail supply

system and in managing its impact

on funding. He fielded the supply

systems conversion, hosted

command-wide training in the

system and devised practical

solutions to unique systems and

accounting problems in order to

successfully close the fiscal year.

He capitalized on and exploited

Active Component lessons learned

in converting supply operations to

the system, particularly the

nagging duplicate obligation

problem that had plagued other

commands. Due to Fulghams

exceptional expertise and focus,

USARC turned in a distinguished

performance in converting to the

standard Army retail supply

system.

About the Author

Michael G. Mowry is an auditor

with the U.S. Army Audit Agency

currently on a developmental

assignment in the OASA(FM&C)

Proponency Office and serving as

program manager for the PRMC,

PMMC, Developmental Assignments and the Mentorship and

Awards Programs. He attended

Pennsylvania State University and

University of Maryland, majoring

in accounting and management.

Easy ACCES Is Here!

Many of us have already experienced the feeling of ease, power and exhilaration that comes from

doing things on the internet, like buying books and CDs, trading stocks and mutual funds, or searching

and finding long-lost information. Well, now anyone who wants to work for or get promoted in the Army

Comptroller career field can register on-line in ACCES, the Armys civilian career evaluation system.

What used to be a tedious pile of manual forms is now light and lively on the computer screen. You still

have to write accomplishments that show how good you are at things like writing and briefing, analyzing, innovating, and the like, but its a lot less cumbersome than before. To get started, find the Armys

civilian personnel on line web site, www.cpol.army.mil, and click on Easy ACCES. Follow the instructions for getting a password, and provide the information asked for. Getting a good job in Army financial management has just gotten easier. Try it!
34 RM n1st Qtr 99

Centralizing the disbursing

missions within DFASIndianapolis

by Bonnie Thomas

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The current environment of shrinking DoD

resources challenges the leadership at every level to

develop innovative ways to reduce cost while improving the level of customer service. In October 1995,

the Director, Defense Finance and Accounting

Service, Indianapolis Center established a team to

investigate the feasibility of centralizing DFAS-IN

disbursing functions in one office at Indianapolis.

The team determined that by utilizing existing

DFAS-IN communications and the standard Army

disbursing system, or SRD-1, centralized disbursing

could be effectively achieved. With the support of

DFAS Headquarters, a plan was developed and

funded to upgrade the high-speed check printing

equipment already being used to print military pay

checks at the Indianapolis Center. The team determined that significant improvements could be

realized by upgrading this equipment and populating

the centralized SRD-1 disbursing system with

payment files generated by DFAS-IN Operating

Locations. Not only were enhancements possible in

the generating of checks and EFT payments, but the

team also discovered that gains could be realized in a

wide range of related functional areas, such as

achieving a tremendous reduction in transactions for

others.

The centralized disbursing concept centered on

exchanging information electronically between the

activity authorizing the payment and the disbursing

activity in DFAS-IN. Travel and vendor pay transactions were to be uploaded from the automated travel

system, or IATS, and the vendor pay system, known

as CAPS, into the DFAS-IN centralized disbursing

system on a daily basis. The following business day

the checks, electronic funds transfer payments, and

the advice of payments are prepared and distributed.

After the payments are executed the updated files

are downloaded into IATS and CAPS to provide the

entitlement systems a complete record of the payment. In addition, the accounting bridge files create a

report of disbursements, by appropriation, to the

operating locations that operate the fiscal station

number, or FSN, cited in the voucher. The Deputy

Director for Central Disbursing, or DDCD, submits

the monthly consolidated Statement of Accountability, 302A, to departmental accounting while the FSN

submits the Statement of Transactions, 304T. To

ensure the end-of-month expenditure reports reconcile, DDCD balances the bridge files each day.

The original concept for centralized disbursing

became the focal point for developing follow-on

systems integration initiatives and is instrumental in

our ongoing efforts to solve many of the problem

disbursement issues.

A significant change occurred during the development of centralized disbursing. An Advice of Payment, known as AOP, was needed to replace the

travel and disbursement vouchers that previously

accompanied the payment. The team designed a oneto two-page AOP that satisfied the payees need for

information concerning the payment, without overburdening the voucher with extraneous information

useful only to the finance community. Samples of the

vouchers were provided to a large number of travelers

and vendors via a formal survey for their comments.

Responses to the survey were exceptionally positive

and indicated that the team had achieved the goal of

providing payment information the payee desired, in

a reader friendly format.

In January 1997, the Directorate for Centralized

Disbursing officially became a separate directorate

within the Indianapolis Center. During a reorganization in November 1998 the organization was renamed

as the Deputy Director for Central Disbursing.

One great advantage of centralized disbursing is

that it provided an opportunity to automate many

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RM n1st Qtr 99 35

About the Author

Bonnie Thomas is currently the Assistant Deputy

Director for Treasury Operations, Deputy Director

for Central Disbursing at DFAS-IN. She has been

with the centralized disbursing project since the

project team was established in 1995 and has over

22 years of experience in financial management and

financial systems analyst positions.

Army Comptroller Intern Handbook

The Army Comptroller Proponency Office

plans to publish a handbook for comptroller

career program interns in June. Editing and

staffing are well along on this beginners compendium of helpful facts and reference sources.

Topics include things like how to prepare travel

orders for schools, how to select and arrange

training called for in the training plan, and names

and locations and telephone numbers of people

who can help get things done. The book is

designed to lead interns by the hand, through inprocessing and supervisors orientation, to the

essential business of helping to design, lay out

and refine their own two-year training and

professional development plans. Interns will

learn to approach training with a critical eye: was

the training worth going to; should others attend

also; what were strong and weak points? The

central aim is to get interns thinking of themselves as professionals-in-becoming.

functions that had previously been accomplished

manually. The labor intensive effort experienced in

every disbursing office, of matching, folding and

manually inserting the voucher and the check in an

envelope, was eliminated in the centralized environment through leading edge technology. Upgraded

high-speed equipment allows DDCD to produce and

deliver payments into the mail or electronic systems

the day after the request for payment is input by the

authorizing activity. Taking advantage of redundant

equipment production lines has enabled us to meet

this goal more than 98 percent of the time and never

have payments been delayed more than one day.

The upgraded equipment also has many validation

routines that ensure a high quality product. The

electronic self test of the Treasury check ensures it is

printed properly, while an electronic match of the

check with the voucher validates that the check is

associated with the proper payment for that voucher.

Recent software upgrades are generating savings in

postal costs by adding expanded zip code information. When fully implemented we project postal rates

will be reduced between 7  15 cents per item.

While significant savings, related to the centralizing of disbursing, are provided in the reduction of

resources, even more important savings result from

the dramatic decrease in transactions for others.

DDCD currently disburses the funds for more than 85

percent of the Army fiscal stations, with the number

increasing each month. A disbursement by one of

these fiscal stations for another fiscal station, served

by DDCD, is now processed as a for self transaction. Not only does this result in significant savings in

the effort previously dedicated to researching and

processing these type transactions, but it also allows

the more timely posting of the accounting records and

provides our customers with a basis for better management decisions.

DDCD endeavors to take the lead in testing and

expanding the use of alternative automated payment

delivery systems. An example is the On-Line Payment and Collection, or OPAC system, which is

quickly expanding as a means used to make large

dollar value payments expeditiously and effectively.

OPAC offers a vehicle to make payments and collections between DFAS-IN and other government

activities, such as Internal Revenue Service and

General Services Administration and eliminates the

majority of the delays inherent in the traditional

payment and clearance processes.

In addition to disbursing government funds,

DDCD utilizes the high speed printing equipment to

process all U.S. Savings Bonds for the active duty

military personnel of the Army and Marine Corps,

together with bonds for all military retirees. More

than 100,000 Savings Bonds are printed and distributed monthly.

Since the inception of centralized disbursing,

tremendous progress has been made in reducing the

costs of DFAS-IN disbursing. DDCD is producing

payment transactions with a staff of 231 employees

that previously required more than 600 employees in

the Army field offices. This has been accomplished

without degrading services to the payee or adversely

affecting the accounting for disbursing transactions.

There have been many lessons learned, and there

are still challenges to overcome. However, our

experience to date has shown that centralized disbursing has been a contributing factor in reducing problem disbursements; and that there are both economic

and functional benefits from consolidating some

business processes.
36 RM n1st Qtr 99

OASA(FM&C) Budget

by Maj. Gen. Clair F. Gill

OFFICE, ASSISTANT SECRETARY OF THE ARMY

(FINANCIAL MANAGEMENT & COMPTROLLER)

The following sections were written by different OASA(FM&C) deputies. Not every deputy will provide input for this feature.

PERSPECTIVES

Fiscal Year 2000 Army Budget

Last January, I briefed the Armys fiscal year 2000

budget at the DoD press conference. I want to share

my perception of what the fiscal year 2000 budget

does for us, as well as some concerns. We have

requested $67.3 billion in total obligation authority,

which is $3.0 billion up from the 1999 Presidents

budget. The fiscal year 2000 budget supports the

Armys vision and commitment to maintain a total

quality force of active, reserve and guard soldiers and

civilians. It supports the shape, respond, prepare

strategy validated by the Quadrennial Defense

Review and adequately resources the Army to

accomplish near-term mission requirements set forth

as the national security and military strategies. We

have balanced the budget to enhance readiness,

preserve modernization efforts, integrate the force

structure and maintain quality of life.

The Armys challenge has not changedstay

trained and ready while conducting the most fundamental transformation since the end of World War II,

in an era of constrained resources. To meet this

challenge we must continue caring for our most

precious resourcepeoplewhile balancing current

and future readiness. Our people remain our number

one readiness issue. The fiscal year 2000 budget

improves quality of life programs, beginning with just

under half a billion dollars for a 4.4 percent acrossthe-board raise for everyone next January, plus

proposed retention raises in basic pay for mid-grade

officers and enlisted personnel, varying by length of

service.

Our proposed budget also would bring back the

pre-1986, 20-year retirement rate of 50 percent, in

place of todays 40 percent under the Military Retirement Reform Act. Retirement would be figured as 2.5

percent of the highest 3-year average of basic pay

times length of service, or 50 percent starting at 20

years, with a few cutbacks in cost-of-living allowances. For many soldiers, thats the best pay news in

years.

The fiscal year 2000 budget supports end strengths

of 480,000 active, 205,000 reserve and 350,000 Army

National Guard soldiers. The civilian workforce end

strength will drop about 6,000 or 2.8 percent from

this year, to about 218,000 in 2000.

Our budget further promotes force readiness by

strengthening quality-of-life structure for Army

soldiers, civilians and their families. The whole

barracks renewal program, a primary QOL initiative,

includes a half billion in military construction, Army

to improve single soldier living conditions. Of that,

81 million would be to start new construction in

2000, the rest following in 2001 to finish the projects.

Weve proposed just over a billion in Army family

housing to operate and maintain 123,000 family

housing units worldwide. Slightly less than half of

that is for major maintenance and repair of about

1,000 units. Another 61 million of it would be for

construction projects, including 14 million in 2000

housing construction in Korea and Germany. Absent

from this budget is any domestic replacement construction or major family lodging renovation. Rather,

in 2000, in keeping with the 1996 Military Housing

Privatization Initiative (PL 104-106), we plan to

award privatization contracts for housing at Fort

Hood, Texas, Fort Lewis, Wash., Fort Meade, Md.,

and Stewart/Hunter Army Airfield, Ga.

Some quality concerns remain: while manning is

covered, Army recruiting and retention challenges

persist. An interesting anomaly is that as we reach

steady-state strengths, recruiting goals have tended to

rise. In the fiscal year 2000 budget, weve responded

to this by increasing funding of recruiter support and

also addressed the increasingly difficult market

conditions. The budget also adds recruiting enhancements like an increased maximum combined Montgomery GI bill and Army college fund benefit of

$50,000.

The fiscal year 2000 budget cuts near-term readiness risk but keeps higher risks in future readiness by

delaying modernization improvements and infrastruc-
RM n1st Qtr 99 37

PERSPECTIVES

ture revitalization until later in the future years

defense plan. Field commanders will see greater

funding increases and flexibility to protect training

and to provide QOL that our soldiers and families

deserve. However, much work still needs to be done.

There isnt enough in the fiscal year 2000 budget to

improve modernization to the levels we need to

ensure future readiness.

The Armys ground operating tempo or

OPTEMPO and flying hours program have been

funded to meet readiness levels specified in the

Defense planning guidance document. In 2000, the

budget supports ground OPTEMPO of 800 miles per

year for the M1 Abrams tank, 934 miles for the M2

Bradley infantry fighting vehicle and 970 miles for

the M3 Bradley cavalry fighting vehicle. It supports

an average of 14.5 flying hours per aircrew per month

for the active component. In selected units,

OPTEMPO miles include a small number of close

combat tactical trainer (simulator) miles, as well as

actual miles. The fiscal year 2000 budget supports

216 tank miles and 9.0 flying hours per month for the

Guard and 164 miles and 9.5 flying hours for the

Reserve.

Supplying and maintaining equipment for the

Armys soldiers is essential to overall readiness. The

fiscal year 2000 budget increases support for depot

maintenance ammunition and pre-position stocks

program and sustains logistics support programs such

as second destination transportation and supply depot

operations.

Posts, camps and stations provide the platform

needed to train and launch todays power projection

Army, and the fiscal year 2000 budget ensures that

this platform supports the national strategy. It also

sustains, with minor risk, base support infrastructure

to include communications, engineering and public

works, and minor repairs and maintenance.

We still have some readiness concerns with this

budget. While we think it will arrest facility deterioration somewhat, we were forced to delay the recapitalization start until budget year 2003, an annual 178

million shortfall until then. These increases in readiness funding are dependent on inflation, foreign

currency and military construction incremental

funding presumptions.

Modernization continues to be a critical component of the Armys ability to support the national

military strategy and its effort to maintain a comprehensive ability to defeat any current or foreseeable

military threat with minimum casualties. We manage

modernization of Army weapon systems and equipment through a continuous process of change and

growth that encourages innovation, imagination and

responsible risk-taking. The fiscal year 2000 budget

continues the Armys emphasis on critical modernization programs, major system upgrades and critical

missile and combat service support systems; but it has

no new starts. Critical modernization programs, such

as Comanche, Crusader, Longbow Apache, Longbow

Hellfire, Army Tactical Missile System-Brilliant

Anti-Tank, Abrams tank upgrade and the family of

medium tactical vehicles, continue to move forward.

Procurement appropriation request is 400 million

more that for this year.

We continue the Armys long-standing commitment to modernize the Reserve, with historically high

modernization efforts continuing through Army

procurement of new systems and redistribution of

displaced or excess equipment from within the Army

inventory. Funding for the Reserve continues for the

Avenger, Sentinel, Blackhawk, heavy equipment

transporter, MK-19 grenade launcher, advanced field

artillery tactical data system, line haul trucks, logistics support vessels and the deployable universal

combat earthmover or Deuce. Equipping the force is

viewed from a Total Army perspective and based on

the first to fight principles articulated in the Defense

planning guidance document. We have made great

strides, but we still have compatibility shortfalls and

essential support equipment shortages.

Even with our commitment to improve long-term

readiness, there exist modernization shortfalls in

soldier support systems, replacement of aging equipment, improvement of combat systems, procurement

of modernized munitions, modernization of reserve

components, and Force XXI digitization.

The Army has worked diligently with Defense and

Administration officials to produce this budget. I

believe our budget reflects a balanced assessment of

the Armys needs and priorities. It seeks to enhance

readiness, preserve modernization, integrate the force

structure and improve the quality of life. We have

worked hard to achieve a balance between readiness

and modernization that provides readiness today with

the elements that will make the Army ready tomorrow. This has been a substantial challenge, one

greatly assisted by the presidents recent decision to
38 RM n1st Qtr 99

PERSPECTIVES

increase DoD funding. We are committed to the balanced allocation of resources in accordance with warfighting

policies while allowing our commanders

the flexibility during execution, and

within legislative restrictions, to conduct

daily operations.

As resource managers, we must

ensure that funding is balanced to

maintain readiness and quality of life,

while providing the investments in

recapitalization and modernization the

future demands to achieve full spectrum

dominance as the worlds preeminent

land force. And we must all practice

good stewardship to ensure that each

scarce dollar provides the best return on

investment.

Program and Budget Data, $ in billions

(President's Budget)

 Appropriation FY 99 FY 00

Military Personnel $26.6 $27.8

Procurement 8.2 8.6

Research, Development, Test &

 Evaluation 4.8 4.4

Operations and Maintenance 20.9 22.9

Military Construction 0.9 0.7

 Army Family Housing 1.2 1.1

 Base Closure and Realignment 0.5 0.2

 Environmental Restoration Act 0.4 0.4

 Chemical Demilitarization 0.9 1.2

 Army Working Capital Fund 0.1 0.1

 Total (may not add due to rounding) $64.4 $67.4

Real savings in operating and support costs

Operating and support costs account for the largest

portion of a systems life cycle cost. With the reduction in defense budgets since the end of the cold war,

operating and support costs have become a target for

review, with a rise in interest in total ownership cost

of every system. Army total obligation authority

reductions have been made by cutting personnel and

modernization accounts. With operating and support

costs such a large part of the Armys budget, they

need to be closely examined, because that makes

good business sense.

In considering investments in O&S cost-reducing

initiatives, two basic principles ensure that real

savings are identified to appropriately balance funds

within the Armys budget: (1) use the same data that

built the budget, and (2) you cant save more than you

have. If you use the same data the budget was built

on, then any savings derived can easily be identified

within the appropriate budget line. The anticipated

savings cannot exceed the amount budgeted for the

system you are improving.

There are many cost reduction programs with

different names, funding sources and requirements.

Examples are modernization through spares; reliability, maintainability and sustainability; supply manOASA(FM&C) Cost Analysis

by Robert W. Young

agement Army operations and support cost reduction;

commercial operations and support initiatives; and

investment initiatives from the last extended budget

plan or POM for 2001-2005. All of them are designed

to reduce operating and support costs and they all

require cost reduction proposals to be supported by

economic analysis.

These cost-saving programs usually single out

operations and maintenance Army as those to be

saved and thereby reallocated to another part of the

budget. The projected savings may be taken from the

budget before they are realized. This poses a real

problem when, if planned savings are not realized, a

subsequent bill is generated instead. That point is not

always fully understood by cost reduction advocates

and is the reason many projects tendered as costsavers have failed the evaluation test.

 One objective of cost-saving proposals is to make

operating and support cost savings available for

modernization programs. This objective is at risk

unless the funds projected to be saved and recommitted to other priorities are real savings.

Another concern with the concept of reallocating

operating and support cost reduction savings in the

POM before they are realized is the potential to view

the projected savings for the specific system in
RM n1st Qtr 99 39

PERSPECTIVES

isolation. What may be forgotten is that these same

systems have other projects underway which add

capability or improvements that often increase the

operating and support costs to support the system.

These improvements may well offset any savings

proposed, and require an overall increase in operating

and support cost funding for the Army. As an example, this is a possibility with the addition of digitization to many systems. We also have the addition of

new or modernized systems, which increase total

Army operating and support costs. It is even more

difficult to identify the operating and support cost of

these new and improved systems at Army headquarters than it is to identify legitimate savings on legacy

systems.

The OPTEMPO budget is based on class IX (repair

part) demands captured in the operating and support

management information system which is managed

by our Army Cost and Economic Analysis Center.

This system is the first source for identifying and

measuring real savings. Our new operating and

support management information system relational

database currently contains data from fiscal years

1994-1997, on national stock number prices and

demands, system operating tempo and density and

ammunition usage. By next July, the operating and

support management information system relational

database will expand to include data from years 1990

through 1998. We also plan additional capabilities

and data to further refine actual costs.

Savings associated with military labor work-hours

are not appropriate to justify supply management

Army operations and support cost reduction program

cost reductions, since these manpower costs will be

incurred for some other requirements. However,

work-hours associated with civilian and especially

contractor support are appropriate. Contracts for

support can easily be reduced, and savings taken;

however, government civilians are like military and

may be moved to other jobs, thereby not achieving

the personnel reductions needed to count savings.

By keeping the above two basic principles in

mindderive savings projections from the same data

the budget was built on, and, you cant save more

than you havemore projects will pass the evaluation test, and the intent of these programs will be

realized. All of us must do our best to ensure that the

projected savings are real savings and that taking or

harvesting them will ultimately benefit the Army.

Name Command

Richard D. Aigen HQDA/AAA

Gregory P. Cyr EUSA

Halstead N Green USAREUR

Randall F. Jordan HQDA

Stephan S. Kreiser USAREUR

Veronica M. Lewis FORSCOM

Terri B. Matthews HQDA/AAA

Paul A. Murray USAREUR

Renee A. Picot HQDA/AAA

Sally J. Rake AMC

AMSC SBLM class graduates

The Comptroller Career Program had 19 students among the graduates of the Army Management Staff

Colleges Sustaining Base Leadership and Management program class 98-3, which finished in December.

During the intense course, students worked on creative and unconventional solutions to familiar problems. They focused on big-picture issues like why we have an Army; how we design it; how we staff,

equip, sustain, support, and station the Army; and issues in leadership, management, decision-making and

stewardship that Army civilian leaders have to deal with. Congratulations to all graduates for thinking

way outside the box!

Name Command

Julie K. Rief FORSCOM

Michael F. Rolla TRADOC

Vicky W. Sain HQDA/AAA

Hettie R. Smith FORSCOM

Sabra J. Suttles FORSCOM

Joseph H. Thompson USAREUR

George R. Warren FORSCOM

Voncile Y. Williams USACE

Linda J. Wilson MEDCOM
40 RM n1st Qtr 99

PROFESSIONAL DEVELOPMENT

HIGHLIGHTS R

M

The Business of Defense: The PRMC

by Judy Holmes

Editors Note: The following article appeared in

the Syracuse University School of Management

publication SU Management, Winter 1999 issue, and

is reprinted with permission.

It wasnt a typical Monday morning for this group

of 35 military and civilian resource managers. For

one thing, they found themselves sitting in a classroom in the School of Management instead of their

offices, which are located at duty posts around the

world. For another, they were confronted with an

intentionally insoluble assignment: to find a solution

for the Social Security conundrum by the end of the

week.

The group was one of three classes that attend the

Professional Resource Management Course or PRMC

each year. Sponsored by the Department of the Army,

the four-week program is designed for resource

managers of the Army and DoD. Students attend

classes eight hours a day, and they are involved in

team projects in the evening. Their one driving goal:

to improve their analytical, communication and team

skills, while gaining a better understanding of the

Armys resource management process and the

political and social environment in which it operates.

The DoD, SU and the school are no strangers to one

another. Not long after World War II, the Army

Comptrollership Program, which led to the MBA

degree, was hailed as a breakthrough by the Wall

Street Journal  not only for the Army, but in executive education. PRMC is the most recent achievement

in this long tradition of collaboration. It is administered by Col. David Berg, U.S. Army (retired),

director of Army programs. Classes are taught by

Berg and members of the schools faculty, with an

important assist from guest speakers, who videoconference with students from SUs Greenburg

House in Washington.

Referring to the massive challenge of straightening

our Social Security within the week, one member of

the course, Maj. Dennis Bradford, reported, Our

team battled it out last night for more than three

hours. Fresh from a post in Panama, Bradford said,

People take the exercise seriously. We expressed our

own views and learned by looking at other perspectives. Says Berg: Thats exactly the point of the

exercise  to help students communicate better, to

break down barriers, to work as a team. Resource

management isnt about money or budgets. Its

greatest challenge lies in reconciling diverse views.

Students agree that one of the primary benefits of the

program is a chance to interact with colleagues

representing a broad range of commands and job

functions within the military establishment. Reid

Zoller, a civilian managed-care program manager

stationed in Heidelberg, Germany, recalls: My job is

focused on managing health care for Americans

stationed in central Europe. I wanted to get more

exposure to budgeting and other financial aspects of

our field outside the health care arena. Interacting

with the other professionals in the program was

invaluable.

In the programs final team project, students are

challenged to cut $600 million from the Army budget.

They are divided into special interest groups within

the Army bureaucracy, each with its own turf to

protect. They receive copies of an actual Army

budget and are given two weeks to reach a consensus.

The entire class must agree on the final version and

then defend it in a videoconference with a representative of the Army Budget Office.

The exercise offers vital insights not only into the

budgeting process but also what lies in store. We all

know we are going to have to make cuts, and I want

to learn how to work around them, says Jennifer

Judge, a civilian budget analyst from Fort Huachuca,

Ariz. We also need to recognize that a good percentage of our work will be privatized, and we need to

understand how to work within that process.

About the Author

Judy Holmes, News Manager of News & Publications,

SU Management, Winter 1999 Issue, Syracuse

University
RM n1st Qtr 99 41

PMCC Class 99-R graduates

The Army had 13 military and four civilian

students in Professional Military Comptroller Course

class 99-R, the annual offering for Reserve Component commands and agencies of all the military

departments. The class graduated in December 1998.

Students completed two weeks of instruction in

contemporary resource management issues and

problems facing financial managers throughout DoD.

Name Command

Col. Rick Baccus R.I. ARNG

Joseph G. DeBoer 80th Div (IT)

Capt. Leslie R. Douglas-Jones 99th RSC

Maj. Quinton H. Fulgham USARC

Maj. Melinda C. Grow Nev. ARNG

Maj. James T. Hrdlicka N.Dak. ARNG

Linda S. Lombardi 70th RSC

Maj. Paula S. Lorick 81st RSC

Maj. James W. Macon OASA(FM&C)

Maj. Paul R. Meyers Ohio ARNG

Col. James A. Minor USARC

Peter R. Morey 63rd RSC

Col. James R. Morgan N.Mex. ARNG

Col. Michael E. Rawlins Hawaii ARNG

Johnny W. Schablik, Jr. 81st RSC

Col. Michael H. Sumrall Ala. ARNG

Maj. Bobby C. Thornton Miss. ARNG

 Four military and 24 civilian students from 11

major commands, Army headquarters and the

Defense Finance and Accounting Service graduated

in February from Professional Resource Management Course class 99-II at Syracuse University,

Syracuse, N.Y. Students completed four weeks of

graduate instruction in the process and the environment of resource management. They also worked

group exercises to improve communication and

decision-making skills. Congratulations to all on

finishing this challenging instruction.

PRMC Class 99-II graduates

Name Command

Carolyn Carlisle MEDCOM

Jesse B. Carter AAA

Albert J. Cato USAREUR

Chony T. Culley EUSA

Felicia D. DeJesus INSCOM

Maj. Kenneth A. DeVoe FORSCOM

Maj. Olen L. Dorney OCAR

Cecelia A. Fancey HQDA

Elizabeth W. Gillick EUSA

Lerome Gunter AMC

Julijana Halilagic USAREUR

James C. Harden FORSCOM

Christine E. Helman MEDCOM

Diana M. Hoffman MEDCOM

Li S. Hood HQDA

John F. Kaiser DFAS

Maj. Jeffrey F. Koob TRADOC

Suky I. Legris EUSA

Maj. William R. Newcombe MEDCOM

Alyson K. Olson USAREUR

Ruby M. Price AMC

Barbara P. Rauch TRADOC

Angela M.Stanford HQDA

Denise M. Turner USACIDC

Joseph L. Watson, Jr. USAREUR

Michael A. Watson EUSA

James D. Wickersham MTMC

Renaté C. Woods SMDC

FM Redesign seeks to improve Army financial

management by streamlining organizations,

reengineering processes and leveraging investments

in people and technology. As our FM community

began taking significant personnel cuts, with more

still expected, the Assistant Secretary, Hon. Helen

McCoy, directed a comprehensive assessment of

Army-wide financial systems, processes and organizations. That was to develop a framework and new

business processes to help smaller FM organizations

become more flexible and agile, so they could

FM Redesign Update

continue giving expert advice to support Army

mission accomplishment.

The first major event was a contractor-facilitated

review by senior FM personnel from throughout the

Army. The review led to 28 proposed initiatives in

five broad categories covering personnel, information

technology, organizational structure, funds management and business practices.

FM Redesign implementation comprises key

efforts to apply guiding principles of the Defense

Reform Initiative in the areas of core competencies,

investment in people and exploiting information

technology. A significant effort is the Financial

Analyst initiative, updated elsewhere in this issue.

Along with that, todays proven information

technology capabilities, especially those of the World

Wide Web, offer unprecedented opportunities to

improve business processes. For the Army, one of the

major impediments to effective resource utilization is

the lack of timely and accurate execution data for

decision makers. Resolving this problem is a top

priority. Coordinated efforts are now underway with

the Armys information manager and with other

organizations that have successful and innovative

automation efforts ongoing. Their aim is to provide

near real-time access to execution data via the World

Wide Web.
February 19, 1999

MEMORANDUM FOR COMPTROLLER CIVILIAN CAREER PROGRAM (CP 11)

 CAREERISTS

SUBJECT: Easy ACCES Is Here for CP 11

I am pleased to announce that Easy ACCES is now available for use in the Comptroller

Civilian Career Program (CP 11). Easy ACCES is the automated, on-line version of our career

referral registration system. We’re going to use this occasion to get the CP 11 ACCES database

cleaned up, so that we have everyone’s correct telephone number, mailing and e-mail addresses

and geographic availability (DA Form 4338-R) in the new system. I urge you to sign on to the

OASA(M&RA) home page a http://cpol.army.mil/ and get a user i.d. and password today.

Careerists who want to keep being referred afte June 1, 1999 need to renew their

registration in the central referral inventory using Easy ACCES. This renewal requirement

also applies to everyone who submitted a first time ACCES package for the accomplishmen

rating panel. We need everyone registered now to check and be sure your personal information,

referral desires and available locations are the way you want them. Registrants and supervisors

should also make any needed changes in ratings on the knowledge and ability factors. Your

current accomplishment ratings will carry over into Easy ACCES. If you already submitted

accomplishments for a recent panel rating, those ratings will be in your Easy ACCES record.

By renewing your registration on-line, you will not experience a break in referral

after June 1, 1999. If you don’t, your record will become inactive (no referrals) until we

hear from you via Easy ACCES. Any changes you make while renewing your registration online, other than accomplishments to be rated by the panel, will take effect immediately. You can,

and you should, submit accomplishments for panel rating on-line as well; these must be received

by the published quarterly deadlines for rating by the next panel.

If you are not yet registered in ACCES, now is a great time to do so, because it’s so much

easier. You can work on any part of your package, one segment at a time. The system keeps

track of the status of each segment and will let you know when your record is complete. Each

supervisor needs to log on the system and obtain a user identification and password as well.

I hope you will take the time to act now and work on your registration package. The staff

at the OASA(M&RA) Career Management Operations Branch is standing by to answer questions

about Easy ACCES. The point of contact for more information is Marsha Arrington, DSN 221-

7260, (703) 325-7260, arringtm@asamra.hoffman.army.mil or EASY@asamra.hoffman.army.mil.

Francis E. Reardon

Functional Chief Representative

Comptroller Civilian Career Progra
Assistant Secretary of the Army

(Financial Management & Comptroller)

Our Mission -- What We Do ...

Our mission is to provide professional

resource managers who support the full

spectrum of Army operations and deliver

pertinent, timely, and reliable information

and advice to decision makers.

Vision -- Where We Are Going ...

We share a vision as a Worldwide Team of Professionals who are:

Motivated to pursue the path to excellence through

continuous improvement in all that we do;

Empowered to think globally and act locally as we

address the true needs of our Army;

Inspired to provide our customers with information,

products, and service so outstanding that we will be the

premier supplier.

Our Guiding Principles ...

Professional Develop a technically competent and confident

Development workforce that is visionary in its approach to

resource management issues, concepts, and daily

operations, and that is committed to providing

responsive, innovative, and professional services

and products to the customer.

Quality Recruit a professional workforce focused on

providing efficient and effective services and

products to the customer.

Retain our workforce by offering them professional

educational and career enhancing opportunities and

by providing them with a quality work environment.

 -- Excerpt from CP-11 Strategic Plan

RM n 1st Qtr 99 43
PIN: 076872 000

DFAS-Indianapolis Center

Resource Management

Professional development bulletin

(ISSN 0893-1828)

Attn: DFAS-IN/U

Room 207E

8899 E. 56th St.

Indianapolis, IN 46249-0150

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