UNCLASSIFIED UNCLASSIFIED

UNCLASSIFIED UNCLASSIFIED
Army Materiel Command
Honorable John M. McHugh Secretary of the Army
Sustaining the Strength of the Nation!
Facer – What I Want To Leave You With
 Theme today: how we‟ve adapted – and are adapting – for our future
UNCLASSIFIED
 Several updates on items you asked for (BRAC, Efficiency Directive)
 Will discuss several efficiencies
 Visit to the Prototype Integration Facility this afternoon
 Looking forward to your thoughts throughout … intended as a discussion vice a brief
Takeaway: All about supporting the Warfighter
GEN Dunwoody
What I Want To Leave You With  Thanks For Taking Time To Visit
UNCLASSIFIED
 A Decade at War
 Adapting and Transforming  Looking Forward to Your Thoughts
UNCLASSIFIED
2
Facer – AMC Commanders and Deputies
{Gen Dunwoody – Introduce Team – Around the Table and Room}
UNCLASSIFIED
Welcome Back! Thanks for taking the time to visit …
 Showed this at your last visit
 Approx 1/3 of our leadership have turned over (yellow) or are scheduled to turn over (green)
Takeaway: New faces, new place, new facilities ... same dedication and professionalism
GEN Dunwoody
AMC Commanders and Deputies
H.Q. Army Materiel Command TACOM LCMC
MG Kurt Stein Mr. Mike Viggato
UNCLASSIFIED
As of 1 June 2011
Assembled Chemical Weapons Alternatives Program
BG John Wharton
LTG Dennis Via
GEN Ann E. Dunwoody
Mr. John Nerger
CSM Jeff Mellinger
Mr. Conrad Whyne
Mr. Joe Novad
Civilian 15,303 | Military 72
Civilian 32| Military 0
Aviation and Missile LCMC
MG Jim Rogers Mr. Ronnie Chronister
Civilian 1,121 | Military 83
Spec Assistant
Military Surface Deployment & Distribution Command MG Kevin Mr. Mike Leonard Williams
New Since Mar 2010
Ms. Terry Gerton
Departing Next 6 Months
Civilian 9,842 | Military 89 Civilian 1,449| Military 373
Joint Munitions Command
BG Gus Perna
Mr. Jyuji Hewitt
JM&L LCMC
BG Gus Perna
AMC Band
CW4 Peter Gillies
US Army Security Assistance Command
BG Chris Tucker
Army Sustainment Command
Civilian 245 |Mil 407
Mr. Robert Moore
MG Yves Fontaine
Mr. Scott Welker
Civilian 6,808 | Military 27 6,582 19
Civilian 0 | Military 31
Civilian 561 | Military 38
Civilian 1,933| Military 449
CECOM LCMC
MG Randy Strong Mr. Ed Thomas
Chemical Materials Agency
Mr. Conrad Whyne Mr. Don Barclay
AMC SWA
BG Jesse Cross
Research, Development & Engineering Command MG Nick Justice Mr. Gary Martin BG John McGuinness
Army Contracting Command Mr. Jeff Parsons
Expeditionary Contracting Command BG Joe Bass
Mission and Installation Command BG Steve Leisenring
UNCLASSIFIED 61 Civilian 8,687| Military
Civilian 1,415 |Mil 749
Civilian 5,610|Military 504
3
Facer - Priorities
 Continuous process of reviewing/updating priorities
UNCLASSIFIED
 Cross-walked your priorities against ours and review weekly
Takeaway: Mutually supporting efforts
GEN Dunwoody
Priorities
SecArmy Top Priorities
1. Ensuring a Highly Capable “Force” within Fiscal Constraints 2. Transforming the Institutional Army 3. CSA Transition 4. General Order #3, HQDA 5. Accountability 6. Army Modernization, Equipping & Continued Reset 7. Quality of Army Life 8. ANC Follow-on Actions 9. Energy 10. POM 13-17 Development
UNCLASSIFIED
As of: 11 April 2011
UNCLASSIFIED
CG, AMC Top Priorities
1. SA Directive: Optimization of Materiel Development/Sustainment 2. DOL Transformation 3. Special Installations Pilot 4. Service Contract Management/ Portfolio Alignment 5. Terms of Reference/Succession Plan 6. LMI/LIW Implementation Plan 7. Workforce Quality of Life 8. Operation Red Zone (BRAC) 9. Operational Energy Initiatives 10. Strategic Communications
As of: 10 Jun 2011
Executing Your Priorities
4
Facer – A Decade at War . . .
 Discussed this in the UK  Most of us consumed with budgets and other daily challenges  Sometimes, we need to take a step back and remind ourselves this has been a …  Tough …  Demanding …  And challenging decade. {Gen Dunwoody – Introduce LTG VIA and Decade @ War}
UNCLASSIFIED
Takeaway: We all have much to be proud of
GEN Dunwoody
A Decade at War . . .
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“In the past decade, America’s Army has been challenged and prevailed in some of the most daunting tasks in the history of our military.”
UNCLASSIFIED UNCLASSIFIED UNCLASSIFIED
~ SecArmy McHugh, 31 March 2011
5 9
Facer – . . . Fighting on Two Fronts . . .
 Fighting two wars …  In Iraq …  Ended major combat operations in August of 2010 …  Now completing the drawdown  Increased operations in Afghanistan  One of the toughest combat environments...  … landlocked country …  … the size of Texas, with only 2% of its roads … few paved  … and 18 – 20,000 foot mountains … Takeaway: Building a better life for others
LTG Via
UNCLASSIFIED
. . . Fighting on Two Fronts . . .
Afghanistan  Support/Sustain the Surge  Building Partner Capacity  50% Surge Equipment from Iraq Iraq  Complete Drawdown  Build Iraqi Capabilities and Self-Sufficiency
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 Set Conditions for Department of State/Others
11 6
Facer – . . . In a Tough Distribution Environment . . .  … In a very demanding environment … not just today … but for future missions  Truly a "ground" operation  Political environment, border delays, attacks, dependence on foreign carriers and weather - all make for an uncertain distribution environment Takeaway: Mission success despite all the challenges
UNCLASSIFIED
LTG Via
. . . In a Tough Distribution Environment . . .
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Attacks Border Delays Weather Political Unrest Expanding Militancy Host Government Rule Uncertainty Economic Issues Labor Issues
Theft & Pilferage
Visibility Issues
Road Conditions
13 7
UNCLASSIFIED
Facer – . . . While Supporting Contingency Operations . .
 Support provided at home and abroad  Peacekeeping and Stability operations in Africa …  Humanitarian Relief in Haiti …  Disaster response in Japan …  Small footprint with strategic reach-back  Contracting (Mr. Parsons)  Transportation  Sustainment Takeaway: Quiet success … often assumed away
LTG Via
. . . While Supporting Contingency Operations . . .
UNCLASSIFIED
Rapid Port Opening
Emergency Rations
Logistic Support Haiti - Hurricane Haiti – Earthquake Chile – Earthquake Pakistan – Floods . . . And Now Japan
Water Purification
Mortuary Affairs
15 8
Facer – ... And Responding to Other Threats
 Environment of increasing change and uncertainty  Popular uprisings … and instability across the Middle East …
UNCLASSIFIED
 Regional threats - North Korea
Takeaway: With experiences of the past decade, confident we can overcome the challenges of the next decade
LTG Via
. . . And Responding to Other Threats . . .
UNCLASSIFIED
Revolutions
Autocratic Subversion
Terrorism
Regional Instability
Extremism
Political Unrest
17 9
Facer – The Impact of BRAC
{LTG Via – Mr. Nerger and Mr. Marriott and impacts of BRAC on Command and People} And … we‟ve executed BRAC …  At AMC … BRAC impacted 11,000 employees (1 in 6 employees) across 25 states  Shifted our centers-of-gravity:     Redstone, AL Aberdeen, MD Rock Island, IL Warren, MI
UNCLASSIFIED
 Congressional interest  Intense at Monmouth (CECOM)
UNCLASSIFIED UNCLASSIFIED Takeaway: Continued to execute all missions throughout BRAC
Mr. Nerger Mr. Marriott
The Impact of BRAC
Kansas, KS Umatilla, OR Tooele, UT Deseret, UT Riverbank, CA St. Louis, MO *Rock Island, IL Scott AFB, IL
Iowa, IA
UNCLASSIFIED
*Warren, MI Glenn, OH Letterkenny, PA Picatinny, NJ Selfridge, MI
Watervliet, NY Tobyhanna, PA Ft. Monmouth, NJ Natick, MA Adelphi, MD *Aberdeen, MD
Alexandria/Falls Church, VA
Newport, IN Crane, IN
Sierra, CA
Ft. Belvoir, VA Concord, CA Ft. Huachuca, AZ McAlester, OK Closing Realigning - Loss Red River, TX Lone Star, TX Ft. Sam Houston, TX Corpus Christi, TX Milan, TN Anniston, AL Langley, VA
Ft. Eustis, VA Ft. Monroe, VA Bluegrass, KY Shaw AFB, SC Stennis Space Center, MS Ft. McPherson, GA Ft. Gillem, GA
Realigning - Gain
*Center of Gravity
• Involves half of all US States • One out of every six AMC employees affected (approximately 11,000) • More moves and more people affected than any other Army organization
*Redstone Arsenal, AL
19 10
Facer – A Time of Transition
 Not simply a matter of moving once - in most cases … multiple moves (office and home)
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 For some folks the first lifetime PCS (97% civilian + 3% military
 Deliberate process … orientation briefs, sponsorship, etc.  Also taking care of those leaving AMC/Army  Facilities = Economy of Force (no café/gym/auditorium)  Currently in 31 Temp facilities
 Move disrupted by tornadoes in late April/early May
Takeaway: Stressful times for the workforce (+ lack of adequate Mr. Nerger cafeteria, gym, meeting space)
Mr. Marriott
A Time of Transition
Personal Move
Home Hotel Apartment Home
UNCLASSIFIED
Consolidate From Two Bldgs to One
AMC HQ Belvoir
31 Temp Facilities at RSA
Housing Market Geo Bachelor New Community
21 11
School Year
Facer – People – Our Greatest Resource
 AMC is the largest employer of civilians in DoD  97% = Civilian - represents more than a quarter of all DA Civilians  Center-of-gravity for the generating force  Still Stressed – 22 Suicides since 2008 (4 this year)  Army focused on Soldiers – need complementary program and attention to civilians
UNCLASSIFIED
Takeaway: Working collectively to support our workforce
Mr. Nerger Mr. Marriott
People – Our Greatest Resource
UNCLASSIFIED
UNCLASSIFIED
Taking Care of Our People
12
Facer – Translating Intent into Action
 Institutional adaptation is the challenge of our time  It‟s hard but not impossible  Tendency to focus on the Operational Army  4 Decades without adapting the Institutional Army  An organization in motion … record speed … not in decades but years
UNCLASSIFIED
 Operationalized our institutional command over the past 10-years
 Since 2008 … adapting to an enterprise approach … really a mind-set  Three directives  LMI  LIW  Optimization Takeaway: A busy decade ... Abut next few years even more challenging!
GEN Dunwoody
Translating Intent into Action
Oct 2010 CECOM at APG
UNCLASSIFIED
Sep 2009 Secretary McHugh Appointed
Oct 2009 ACC Fully Operational Capable (FOC)
Mar 2011 Optimization Nov 2010 Directive TF APG Directive
Jun 2011 AMC at RSA
2009
Sep 2009 USASAC at RSA Oct 2009 R2TF FOC
2010
Sep 2010 Operation New Dawn Jan 2010 Haiti Relief Support Oct 2009 Special Installation Pilot Oct 2010 CONUS DOLs OPCON to AMC
2011
Apr 2011 Oct 2011 LMI/LIW Fleet Management Full Scale Pilot Expanded FOC
Mar 2011 LMI/LIW Directives
Jun 2011 ACC at RSA
Enterprise Centric
UNCLASSIFIED
Institutional Change at an Unprecedented Pace
May 2011 Services Acquisition Directive
13
Facer – Fiscal Realities
 You‟ve seen this chart … but we can‟t ignore it  Learn from History  Can‟t assume everyone knows it  Funding at peak of every conflict  Reductions every time – no exceptions  2d & 3d order effects  TF Smith  Hollow Army  Expect a soft landing – never happens – always a clift
UNCLASSIFIED
 Sec Lynn – 0 for 4 … not 0 for 5
Takeaway: Setting the stage for success
GEN Dunwoody
Fiscal Realities
Korean War Vietnam War Height of the Cold War Future Unknown 9/11
UNCLASSIFIED
End of WWII
Hollow Army Task Force Smith
Budget Low Points
“We have gone 0 for 4 in managing the draw-downs to date. We cannot afford to go 0 for 5.”
UNCLASSIFIED UNCLASSIFIED UNCLASSIFIED
~ William Lynn, DepSecDef, May 2011
14 27
Facer – Maximizing Limited Resources
 Can‟t „salami-slice‟ our way out of budget …  … „Salami-Slicing‟ is the easy way out …  5%, 10%, 15% - leads to the same results … share the pain equally and avoid strategic choices  Need to make some Strategic Choices  Assess Strategic Risk  then Develop Strategic Strategy  Bottomline – must turn „salami-slice‟ guidance into capabilities and risk to ensure we make informed decisions Takeaway: Not about what‟s best for one individual … about what‟s good enough for everyone
GEN Dunwoody
UNCLASSIFIED
Maximizing Limited Resources
UNCLASSIFIED
UNCLASSIFIED
A Bold New Strategy . . .
15
Facer – Fundamentally Different Way
 {Gen Dunwoody – Introduce Ms Gerton and Doing Things Differently}
 Need to assess where we divest and when we invest  Strategic Choices will shape our forces  Our Focus:  Prioritize the capabilities we need  Eliminate redundancies  Identify where we are willing to accept risk  Make informed decisions  Adapt to Win - On and off the battlefield  Adapting our institution to move beyond  Legacy organizations  Outdated technologies  Antiquated processes Takeaway: Our challenge is finding a fundamentally different way of doing business Ms. Gerton
UNCLASSIFIED
Fundamentally Different Way of Doing Business
UNCLASSIFIED
UNCLASSIFIED
Becoming More Efficient and Effective
16
Facer – Why is This so Hard?
 The Institutional Army …  Unfortunately many have become entrenched – which creates silos that hinder:  Coordination  Collaboration  Communication Takeaway: More agile/more flexible/more responsive
UNCLASSIFIED
Ms. Gerton
Why is This so Hard?
UNCLASSIFIED
“Institutional change is about doing things better, doing them smarter and taking full advantage of the progress, technology, knowledge and experience that we have available to us.”
~ U.S. Army Posture Statement, 2011
17
Facer – Unity of Effort
(Slide Builds While Speaking)
 All about breaking down the walls between silos  Adaptation occurs right in the center – where the best ideas and talent from each silo is optimized  We can exchange information that leads to informed decisions  Number of examples … DOL transfer, FMX, Special Installations …  It used to be that information was power … today, shared information is power Takeaway: Shared information breaks down the barriers
UNCLASSIFIED
Ms. Gerton
Unity of Effort
Materiel
UNCLASSIFIED
Cooperate People Coordinate Collaborate Communicate Services
Readiness
UNCLASSIFIED
Breaking Down the Silos
18
Facer – Why Adapt?
 Shared this at one of my first AEBs  Primary focus during conflict:
 Buying new equipment to support the Operational Army  Good reasons for doing that…
UNCLASSIFIED
 We don‟t like to get rid of anything (“just might need it”)  Very expensive – no longer affordable
{Gen Dunwoody – Introduce Mr. Dwyer and Why Adapt}
Takeaway: If we don‟t adapt, we won‟t find a different way of doing business
GEN Dunwoody
Why Adapt?
UNCLASSIFIED
WWI
WWII
Korea
Vietnam
UNCLASSIFIED
Desert Shield/Storm
2011
An Unaffordable Approach
19
Facer – Multiple Piles
(Slide builds while speaking)
 Transformed Army
 fewer headquarters  more combat brigades  Modularity/ARFORGEN … right intention … no bad actors  Built separate „piles‟ of equipment in order:  to get the right stuff
UNCLASSIFIED
 to the right place
 at the right time Takeaway: With a smaller budget – no longer an affordable strategy
Mr. Dwyer
Multiple Piles
UNCLASSIFIED
Capability Sets Theater Sustainment Stocks Excess Defense Articles
Theater Provided Equipment
Depot Stocks Army Prepositioned Stocks Unit Equipment
Training Sets Pre-Deployment Training Equipment
Left Behind Equipment
Non-Standard Equipment
39 20
Facer – Multiple Managers
UNCLASSIFIED
(Slide builds while speaking)
 Each pile has own manager  Difficult to synchronize available equipment
 If you‟re the customer, who you go to depends on what you need and
when you need it
Takeaway: Can‟t afford to continue doing business this way
Mr. Dwyer
Multiple Managers
UNCLASSIFIED
Army Commands
Medical Command
Army Service Component Commands
Program Executive Officers
HQDA G-4 (Logistics)
HQDA G-8 (Finance)
Program Managers
Reserve Components
Lifecycle Management Commands
Direct Reporting Units Rapid Equipping Force
41 21
Facer – Multiple Sources of Repair
 Multiple organizations established own repair capability  Own people
UNCLASSIFIED
 Own resources
 Inventory o Repair parts
o Tools
o Equipment  Optimizing repair capabilities is complex
Takeaway: Can no longer afford redundancy
Mr. Dwyer
Multiple Sources of Repair
UNCLASSIFIED
Commercial Industry Special Repair Teams
Depots/Arsenals
Installations Unit Maintenance Program Managers Training Maintenance
43 22
Facer – Multiple Management Info Systems
 Led to numerous independent information systems  Iron Mountains of equipment after Desert Storm    Thousands of containers in theater No visibility on what was in them Or where they were o Shipped containers into the theater o Shipped them back without opening them  Committed to Intransit Visibility and Total Asset Visibility Takeaway: We are facing the same challenge today
Mr. Dwyer
UNCLASSIFIED
Multiple Management Info Systems
UNCLASSIFIED
CIF-ISM AWRDS
LMP MENS-E
SAMS-IE
SAMS-E
PBUSE
TEWLS WMMS
TAMMIS
SARSS
45 23
Facer – SECARMY Guidance
 You directed us to fix just a few short months ago  Thanks – we would not be where we are without your guidance, direction and top-cover  Took us a year before your guidance to get to this point  Now we need to push this mission (ball) into the end-zone  Still a few antibodies out there … we continue to educate and inform  Highway example (was on highway, now in express lane)  All about culture change
UNCLASSIFIED
Takeaway: Providing visibility and speed we‟ve never had before
GEN Dunwoody
46
Secretary of the Army Guidance
Lead Materiel Integrator (LMI) Directive Logistics Information Warehouse (LIW)
UNCLASSIFIED
22 March 2011 “I am designating Commander, U.S. Army Materiel Command (USAMC) as the Army’s LMI with the mission to synchronize the distribution and redistribution of Army materiel in accordance with Department of Defense and Army directives and priorities.” John M. McHugh
22 March 2011
“I am directing the Commander of U.S. Army Materiel Command (USAMC) to undertake the task of creating a repository for Army logistics data that will provide a single, common location for all Army materiel stakeholders to access, acquire and deliver data and information for managing Army materiel.” John M. McHugh
47 24
Facer – Integrating and Optimizing
 “Brute Force” was way of the past … now must take fundamentally different approach … that will lead us to …  … one authority …  … one source of repair …  … one information system …
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 … all working together to achieve complete transparency and visibility of
every piece of equipment across the Army  Already made progress ... can now  see ourselves better ... in real time versus just a projection  provide pinpoint disposition for what‟s coming out of our depots and arsenal  And better focus our resources on what needs to be repaired Takeaway: Much accomplished … more to do {Example = Tanks and/or Howitzers} Mr. Dwyer [Transition to BG Brian Layer for Demo] BG Layer UNCLASSIFIED
UNCLASSIFIED
Integrating and Optimizing
Logistics Information Warehouse
Multiple Piles
UNCLASSIFIED
Lead Materiel Integrator
Multiple Managers
US Army
Multiple Sources of Repair
Materiel Command
Multiple Info Systems
49 25
Facer – Decision Support Tool
 Strategic choices … how we manage materiel to meet Army readiness
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 Systems approach to manage materiel
 Leveraging AST … predictive tool that allows us to optimize solutions
BG Layer
Decision Support Tool
UNCLASSIFIED
Lead Materiel Integrator Decision Support Tool
UNCLASSIFIED
26
Facer – Pilot Key Takeaways
UNCLASSIFIED
 Multiple touch points  In real time …  Minutes/seconds vs months/years
BG Layer
Pilot Key Takeaways
 Exceeded expectations
 LMI demonstrated ability to produce a coordinated Army-wide materiel sourcing solution per Army priorities and law  Automated Army-wide materiel solutions in minutes/hours  Rapid course of action analysis allowed multiple excursions  LMI collaboration process worked extremely well to resolve stakeholders issues
UNCLASSIFIED
Demonstrated Successful Progression
27
Facer – Efficiencies Directive
 {Gen Dunwoody – Introduce Ms. Gerton and TF DFR Status/Update}  Your directive to us in March  Met with Ms. Shyu, 17 June  Updated you a few weeks ago  Follow-up to your questions
UNCLASSIFIED
Takeaway: Work ongoing
Ms. Gerton
Efficiencies Directive
Mission: Conduct a review to create a more agile and cost effective research, development, and acquisition system by analyzing work flow and optimizing organizations, processes, and procedures to support the work.
Key Tasks • 150 day review • Save $3B annually by the end of 2015 • Deliberative approach to process and cultural transformation • Optimize PEO and AMC responsibilities
UNCLASSIFIED
UNCLASSIFIED
More efficient, effective, and agile and free-up resources to build the Army of the future.
$3B Savings Will Require a Team Approach
28
Facer – Strategic Issues (Technical)
 You told us what you wanted us to do …
• These strategic issues get at the “Why” • The underlying issues that if addressed will get at the “So What”
UNCLASSIFIED
Takeaway: Hard Issues that have impacted how we operate for years
Ms. Gerton
Strategic Issues (Technical)
1. Lack of Enterprise traceability of funds (flow, source, what spent on) results in inefficiency, lack of visibility, limited ability to: perform management controls, redirect $ to higher priorities, and forecast.
UNCLASSIFIED
2. Process inefficiencies, to include multiple layers of management result in reduced effectiveness and efficiency; leads to increased: throughput time, cost, and distance from customer.
3. Army research strategy that lacks Army-unique focus results in ineffective use of available research $ and insufficient transition to development programs. 4. Capacity of depots, arsenals and storage plants difficult to synchronize with Army OPTEMPO resulting in over/under capacity and lagging response.
UNCLASSIFIED
What We Found . . .
29
Facer – Strategic Issues (Environmental)
 Strategic Issues con‟t …
UNCLASSIFIED
Takeaway: These “environmental” issues are the root cause of the majority of the current issues we currently face and will be the most difficult to address / resolve
Ms. Gerton
Strategic Issues (Environmental)
UNCLASSIFIED
5. Lack of consensus on organizational roles, missions, and functions combined with misalignment of authority, responsibility, and accountability result in multiple faces to Soldier, unnecessary overlap, tension among organizations, and competing objectives. 6. Lack of trust leads to redundancy within and between AMC & ASA(ALT) resulting in increased cost and unnecessary competition.
7. Lack of enterprise-level incentives and governance results in overlap, duplication of investments, lack of strategic focus, inefficient enterprise management and sub-optimal materiel solutions.
UNCLASSIFIED
What We Found . . .
30
Facer – Specified Task to Strategic Issues
 Cross-walked the issues from two previous charts across specific tasks
UNCLASSIFIED
Takeaway: Taking a holistic approach
Ms. Gerton
UNCLASSIFIED
Specified Task to Strategic Issues Cross-Walk
Specified Task Strategic Issue
1 2 3 4 5 6 7
Conduct a review to create a more agile and cost-effective research development and acquisition system by analyzing work flow and optimizing organizations, processes, and procedures to support the work Optimize PEO and AMC responsibilities to improve the agility and reduce overlaps and redundancies in the Army‟s [RDA] activities… the study should recommend the skills required in the PEOs and those needed to be developed and maintained in AMC Create an integrated strategy for efficient and coordinated research and development through item management and sustainment Organize efforts to identify technologies that must be in-house while leveraging from commercial, academic, and other government laboratories Reduce life-cycle costs from cradle to grave Support the Army‟s goal to create an auditable financial system & time-to-task reporting for all sources of funds Develop a plan that pursues a significant reduction of personnel and annual savings of $3B by the end of FY 2015, with initial savings realized by the end of FY 2012 and FY 2013
1.
2.
X
X
X
X
X
X
X
X
X
X
X
3. 4.
X
X
X
X
X X X X X X X X X X
X X X
5.
6. 7.
X
X
X
X
X
X
X
UNCLASSIFIED
The Strategic Issues Mapped to the Specified Tasks
31
Facer – ASA(ALT)/AMC Funds Flow ($FY10)
 First time
UNCLASSIFIED
• We‟ve had this level of visibility
• Has taken 115 days to compile • Indication that our financial systems are not set up to enable effective management or support quick financial decisions
Takeaway: Never had funding visibility to this level before and we need to change our funding flow / processes
Ms. Gerton
ASA(ALT)/AMC Funds Flow ($ FY10)
Materiel Solution Analysis
MS A
UNCLASSIFIED
Technology Development
II
MS B
Engineering & Manufacturing Development
MM
MS C
Production & Deployment
SS TT
Operations & Support
UU
Disposal
PEGs
EE
OO
$415M
$549M $145M $57M $668K $1.2B $32.4B
$89M $355M $57M
$12M $124M $31M $24M $35M $397K $6.5B
$3.3B $1.7B $442M $204M $31M $116M $362M
$7.3B $1.6B $1.9B $89M
AMC (RDT&E) (with ASA(ALT) Direction) R&D SBIR MANTECH
RDTE $2.52B (Base)
RDECOM ARL AMSAA RDECs
•R&D •Matrix Labor •Services (lab & mat) $291.2M (Base) $237.7M (OCO) $118.8M $2.5B $1.1B
AMC Funding Source PEO/PM Funding Source Funding Receiver Program Eval Group (PEG)
UNCLASSIFIED
$2.52B
$295.7M $19.2M $10.3B
RDTE
$18.0B (Base) $6.6B (Base) Procurement $16.3B (OCO) $111.5M (OCO)
OMA
$1.9B (Base) $4.3B (OCO)
AMC OMA
$2.5B (Base) $8.9B (OCO) Repair/Reset
AMC Proc
$415M (Base)
ASA(ALT) PM Chem Demil
HQAMC LCMCs Other MSCs
•Acq Suppt •Field Suppt •Log Assist •War Reserves •Matrix Labor •Supply (AWCF) •Distro/Trans •Depots/Arsenals/Plants (AWCF) $2.1B (Base) $8.6B (OCO)
Legend
RDT&E Procurement OMA Other
$1.2B
ASA(ALT) PEOs/PMs
RECAP
ASA(ALT) ASC (Apportionment)
LOGSA
•Data Whse •Acq Suppt •Sust Suppt •Analysis
ATEC
•DT/OT •Prod Testing •Stockpile Testing
PM Support Contracts
•SETA •Products •Services
PM Prime Contracts
•Development •Procurement •Support •Engineering Services
$56.4M (Base) $63.3M (OCO) $490K $850K
$11.4B
Other AMC Customers Other Army ($8.7B) Other DOD ($1.9B) Other US Gov ($110M) FMS ($421M) All Other ($264M)
Summary: ASA(ALT) Base = $27.7B AMC Base = $5.4B ASA(ALT) OCO = $20.7B AMC OCO = $8.9B AMC Other= $11.4B TOTAL= $74.1B
63 32
Tracking the Money
Facer – Process Focused Concepts
 Stratified across three levels … based on difficulty of implementation
UNCLASSIFIED
Takeaway: Stratified concepts across implementation levels
Ms. Gerton
Process Focused Concepts
Inter-dependencies are not yet addressed
1 2 3 4 5 6 7 Virtual IMMC Software Management Support Reliability Improvement Next Gen S/W Field Support AWPS and LMP ATEC (RDECOM and ATEC) Excessive Inventory Savings
UNCLASSIFIED
High
8
9
-
ARL Direct Funding
Virtual Contracting Alt. Matrix Mgt Model (FFRDC) RDE AWCF CNA Study 2006 Merge EE and SS PEGs Make all reimbursable funding AWCF Provide SS PEG funding to PEO's DA G-4 Conventional Ammo WCF Secondary Item PBL Ammo Supply Point
11 12 13 14 15 16 17 18 -
Medium
10 -
$ Benefit of Implementation
1
2
4
5
6
3
7
High
Med
Low
Low
8
9 10
11-19 11-19 11-19 11-19 11-18
Confidence Level
Low
Stratifying the Concepts
Medium Risk of Implementation
High
33 65
Facer – Non-Process Focused Concepts
 Stratified across three levels … based on difficulty of implementation
UNCLASSIFIED
Takeaway: Stratified concepts across implementation levels
Ms. Gerton
Non-Process Focused Concepts
Inter-dependencies are not yet addressed
UNCLASSIFIED
High
1 2 3 4 5 6 7 8 9
-
Virtual IMMC Dr. Braverman Right-size Organic IB OCIE (CIF) Reduction CBM+ Converge RDA Next Gen S/W Field Support Lead Materiel Integrator (LMI) LAISO Lab Reorg Consolidate TMDE Spt Logistics Innovation Agency DA Staff Redundancy (Reduction) PEO Aviation Redefining Generating Force Consolidation of Contracting Decker Wagner
$ Benefit of Implementation
1
2
3-4 3-7
5
6
Medium
10 - ATEC (RDECOM and ATEC) 11 12 13 14 15 16 17 18 -
7
8 9
10
11
12
13 14
High
Med
Low
Low
15
16
17
18
Confidence Level
Low
Stratifying the Concepts
Medium Risk of Implementation
High
34 67 67
Facer – Gap Analysis (Funding)
 One example … and probably the most significant
UNCLASSIFIED
Takeaway: Lack of adequate funding visibility is a major impediment
Ms. Gerton
UNCLASSIFIED
Gap Analysis (Funding)
Strategic Issue 1. Lack of Enterprise traceability of funds (flow, source, what spent on); lack of adaptation to ERP systems (LMP, GFEBS) results in inefficiency, lack of visibility, limited ability to perform management controls, redirect funds to higher priorities, and forecast and does not taking advantage of its full capability via unauthorized work-arounds, inability to divest legacy systems and realize ROI, and not harvesting staffing savings.
Sub Issue
Process Concept
Alt. Matrix Mgt Model (FFRDC) RDE AWCF All Reimb. to be under AWCF Provide SS PEG $s to PEOs Establish LC Mgt PEG ARL Direct Funding
How Process Change (e.g., req‟d change in Addresses Sub-issue org structure)
Provides caps on what is in Limits matrix mgt O/H overhead
Org Impact
Annual Savings
($ Millions )
TBD
Extent that Concept Solves Issue?
limited mod major
Puts matrix mgt under small office to min O/H Provides traceability for reimb. Provides traceability for reimb. Provides stronger traceability of funds Provides coherent approach during programming process Would focus ARL research efforts Provides better financial accuracy, trace. of workld & reduced redund. trans. Provides traceability for reimb. If fully implemented and enforced, concept designed to directly address issue
Lack of financial accountability across enterprise
Supports financial None (note: excludes 6.1/6.2) None accountability system Supports financial accountability system, but None TBD goes beyond materiel issues Would program & execute OMA by wpn sys
None
TBD
Dollars flow from multiple PEGs and organizations
Merging of EE, SS, and All program LC funding programmed from single PEG part of TT PEG ARL would not be allowed to accept reimb work Electronic contracting provides direct feeds to std financial systems LMP system includes time and attendance reporting linked to workload Fully commits / enforces corporate ERP solution and max divestiture of legacy systems Need to assess impact on SLAD None
Minimal
TBD
Accounting system does not provide visibility into work funded and accomplished
Not taking advantage of full ERP capability via unauthorized workarounds causes inability to divest legacy sys & realize ROI via reduction of staff
Virtual Contracting
RDE AWCF
Minimal
None (note: excludes 6.1/6.2) TBD
S/W Mgt Support
None
$10-$100‟sM
(initial est.)
UNCLASSIFIED
Lack of Funding Traceability and Visibility
35
Facer – Time Line
 On track to deliver recommendations to you next month
UNCLASSIFIED
Takeaway: On track
Ms. Gerton
Time Line
UNCLASSIFIED
28 Jul 11: Recommendations to SA
AAE / DUSA Update (6 (Jul)
SA Update (23 Jun )
AAE / DUSA Update (17 Jun)
AAE / DUSA Update (26 May) SA Update (19 May) AAE / DUSA Update (11 May) DUSA / MECC IPR #1 (27 Apr) VCSA Update (22 Apr)
35 Days Remaining
Battle Rhythm Events
AAE IPR #2 (12 Apr) AAE IPR #1 (1 Apr) CG Update #2 (31 Mar) CG Update #1 (25 Mar)
Brief to DUSA and ASA(ALT) Brief to SA
UNCLASSIFIED
1 MAR 11: SA Memo to Optimize RD&A
On Track!
36
Facer – Army FMS Across the Globe
 {Gen Dunwoody – Introduce few quick topics:}     BG Tucker = FMS Mr. Parson = ACC, Gansler status & Contracting Mr. Dwyer = Industrial Base BG Wyche = Chem Demil Status
UNCLASSIFIED
 Changing the channel … quickly talk about changing the way we do business  Process used to be slow & cumbersome … more streamlined now  Tremendous growth in FMS sales  300% cumulative increase Takeaway: Supporting the COCOM Cdrs
BG Tucker
Army FMS Across the Globe
FY03-FY06 $18B ~3400 Cases
UNCLASSIFIED
FMS Portfolio by Region
COUNTRIES: 50 CASES: 1394 VALUE: $13.4B
FY07-FY10 $62.5B ~4600 Cases COUNTRIES: 20 CASES: 842 VALUE: $17.3B
Security Assistance Training Countries: 15 Personnel: 125
COUNTRIES: 22 CASES: 1720 VALUE: $87.7B COUNTRIES: 30 CASES: 444 VALUE: $2.7B
TOTAL ACTIVE FMS COUNTRIES: 154 CASES: 4631 VALUE: $121.7B
COUNTRIES: 32 CASES: 231 VALUE: $590M
UNCLASSIFIED
Building Partner Capacity and Goodwill
37
Facer – Army Contracting Command (ACC)
 Aggressive implementation of Gansler Report  Increase stature of military contracting personnel  Restructure organization & restore responsibility  Provide training & tools  Obtain legislative & policy support to enable contracting effectiveness Takeaway: Thank you for your support!
UNCLASSIFIED
Mr. Parsons
Army Contracting Command
UNCLASSIFIED
General Order #6 Gansler Report, Oct 07 Establishment of Army Contracting Agency, Oct 02
Realignment of ACA to AMC, Jan 08
General Order #20 Establishment of ACC, ECC and MICC, Jul 08
UNCLASSIFIED
Expeditionary – Responsive - Innovative
38
UNCLASSIFIED
Facer - Scope and Impact of ACC Contracting
 An idea of the breadth and scope of the contracting business
Mr. Parsons
UNCLASSIFIED
Scope and Impact of Army Contracting Command
Scope:  FY 10 Federal Contact Spend - $536B  FY 10 DOD Contact Spend - $366B or 68% of Federal  FY 10 Army Contract Spend - $140B or 38% of DOD, 26% of Federal  FY 10 • • • ACC Contract Spend - 93B which is: 17% of Federal Spend 25% of DOD Spend 65% of Army Spend
INCREASING COMPLEXITY
Impact: Supports systems acquisition, sustainment, training, mission and installation missions, and worldwide expeditionary operations (108 in FY10)
UNCLASSIFIED
Contracting Must Be An Army Priority !
39
Facer - Contracting Workload vs Personnel
 Big business … high visibility … must keep up momentum  All about capability brought to the fight
UNCLASSIFIED
Takeaway: More work to be done
Mr. Parsons
Contracting Workload vs Personnel
$166B
UNCLASSIFIED
$132B
$35B
Gulf War I
Bosnia/Kosovo; 1995 - present
9/11 OIF, Attacks 2003OEF, 2001- present present
Gansler Report
UNCLASSIFIED
All About Becoming More Efficient and Effective
40
UNCLASSIFIED
Facer - Key Takeaways
 No Facer comments
Mr. Parsons
Key Takeaways
 Contracting must become an Army core competency  Contract dollars as percent of DoD outlays declining slightly, but will remain higher than pre-Gansler levels  As budgets decline, we need to become better and smarter buyers  Need the right number of people (mil and civ), with the right skill sets, at the right place  Now is not the time to be penny wise and pound foolish
UNCLASSIFIED
UNCLASSIFIED
We Can’t Risk Losing Momentum
41
Facer – Modernizing the Industrial Base
 Prior to 2007, investment in organic industrial facilities flat  Couldn‟t compete against Army priorities (barracks, etc)  Reset gave us that visibility  Now: Visibility of requirements and priorities – something we didn‟t have before  Portfolio reviews allow us to take holistic views – divest excess and modernize the rest.  Portfolio focus was on OIB. AMC consistently showed entire facility requirements … Takeaway: Progress made … more to do
Mr. Dwyer
UNCLASSIFIED
Modernizing the Industrial Base
Pre-2007 . . .
 Aging infrastructure  Risk accepted; focus elsewhere (BRAC, GTA, etc.)  Modernizing through prudent reinvestment
UNCLASSIFIED
Progress . . . 2007-2011
 PAA: $1.01B at GOCO Ammo Plants
 MCA: $540M for AMC projects  AWCF: $850M in Capital Investment
New ANAD Power Train Facility
 Visibility on GOCO plants
 New missions needing facilities
2011
Way Ahead . . .
Old Ammo Plant Facility GOCO = Government Owned, Contractor Operated AWCF = Army Working Capital Fund
UNCLASSIFIED
 Portfolio Review  Address Quality of Work Environment  Special Installation Transfer  Investment Needed:  PAA: $150M annual + $50M for QWE for 6 years  MCA: $350M per year for 15 years
42
Accomplished a Lot . . . Much More to Do
Facer – Organic Industrial Based (OIB) Req
   Total requirements – over $8B (OIB and Materiel Enterprise) Antiquated facilities inefficient and reduce ability to address ARFORGEN VCSA tasking to fix in 5-7 years vs 24-30
UNCLASSIFIED
Takeaway: Requirements identified and prioritized
Mr. Dwyer
Organic Industrial Based (OIB) Requirements
OMA $517M 6% AWCF $150.6 M 2% RDTE/ECIP $79.3 M 1%
UNCLASSIFIED
PAA $1.5B 19%
MCA $5.9B 72%
CIP and OMA/OPA Tails $1.9B
1207 Projects - $8.1B
Demil and Disposal Costs 1174 Structures - $105M
“Provide mature plan with associated timeline that solves the problem in UNCLASSIFIED 5-7 years vs 24-30 years” (VCSA Guidance) 43
Facer – Organic Industrial Base (OIB)
 Have Prioritized OIB requirements  Available FY13-17 funding = $250M  Critical unfunded requirements = $913M
UNCLASSIFIED
Takeaway: Methodical approach & addressing the problems over time
Mr. Dwyer
Our Organic Industrial Base (OIB)
 Industrial base has assumed increased risk over the years  MCA (and other) funding continues to decline  Establishment of an Army Initiative for the OIB and Materiel Enterprise working to correct imbalance by 2020
UNCLASSIFIED
UNCLASSIFIED
First Time With This Level of Visibility
44
Facer – Bottomline: It’s All Possible With Our People
 Can‟t do it without our team of professionals  Sampling of some of our awards since FY10
UNCLASSIFIED
Takeaway: A great team … doing great work
GEN Dunwoody
Bottomline: It’s All Possible With Our People
SECARMY/CSA/DA Safety Awards Chief of Staff Combined Logistics Excellence Awards
UNCLASSIFIED
Standardization Program Winners
Defense
4 Lean Six Sigma Awards
Recognized Supporter 7 Army Acquisition of Historically Black Corps Awards Colleges and Universities (HBCUs) ACC recipient of the 2011 CIO 100 SHINGO Awards 6 Value Engineering Awards
Army Greatest Invention Awards Decoration for Exceptional Civilian Service Awards
LSS Awards
Our Dedicated Professionals People Are Our Credentials
Presidential Rank Awards
41 45 89
Facer – Closing Comments
 No facer comments
UNCLASSIFIED
Honorable John M. McHugh Secretary of the Army
46
UNCLASSIFIED
BACKUP
UNCLASSIFIED
Fraud, Waste, & Abuse In Army Contracting
Army Contracting Officer MAJ John Cockerham Convicted of $9.6M in Contract Fraud (SWA)
UNCLASSIFIED
SWA: 466 Contracting Investigations Since 2005
SWA Suspects: 72% (240 of 329) are US ARMY
GAO Audit results continue to list the same conclusions:
UNCLASSIFIED
Area of Continued Emphasis
47
Accelerating Chem Demil
Actual Destruction Data Date: As of 13 Jun 11 As of 13 Jun 11 CMA Portion of 100% Milestone Progress 27,473 FY16
UNCLASSIFIED
Sites (Owner)
Agent and Storage Configuration
HD, HT, H, GA,L,GB,VX Projos, TCs, Spray Tanks Rockets, Bombs, Mines, Mortars
GB, VX, HD, HT Rockets, Mines, Projos, Mortars, TCs
Total Original Tons
Cumulative Processed
Operations Complete *
Deseret, UT (CMA)
Actual
13,617 13,599 Feb 12
25,015
FY15
Anniston, AL (CMA)
FY14
2,254
2,249
Aug 11
22,557
Umatilla, OR (CMA)
GB, VX, HD, Rockets, Bombs, Mines, Projos, Spray Tanks, TCs
GB, VX, HD, HT Rockets, Mines, TCs
FY13
3,720
2,947
Nov 11
Pine Bluff, AR (CMA) Blue Grass, KY (PM ACWA) Pueblo, CO (PM ACWA) Legends: = Operational
CLOSING
3,851 N/A N/A
3,851
Nov 10
Scheduled
17,642
20,100
FY12
FY11 FY10 FY09
VX, GB, H Rockets, Projos
N/A
N/A
HT, HD Projos, Mortars = Project design/construction
N/A
= Campaign Completed *Earliest Credible Planning Date
N/A
2007
15,184
14,739 FY07 Goal Actual
Treaty progress: 87.4% of declared agent (Stockpile and Non-Stockpile) destroyed.
Note: CMA portion: 27,473 ACWA portion: 3,137
UNCLASSIFIED
Well Ahead of Schedule
Bar Graph Green Bar = Actual Demil Yellow Bar = APB FY Goal Gray Bar = Projected APB
48
UNCLASSIFIED
So, Where Do We Go From Here?
“If you don’t like change, you will like irrelevance even less.”
UNCLASSIFIED
~ General Eric Shinseki, CSA, December 2001
49
AMC Across Our United States
UNCLASSIFIED
People
0 1 – 0049 50 – 499 500 – 4999 5000 +
Primary AMC Locations
UNCLASSIFIED
Every AMC Job Creates ~1.27 Local Community Jobs
50
Challenge Into Opportunity
UNCLASSIFIED
Anniston Army Depot
Including 672 M1s, 285 M109s, 1,019 M113s, and 554 M88s
Including 3,868 HMMWVs, 1751 Bradleys, 1525 Trucks and 491 Trailers
Red River Army Depot
Letterkenny Army Depot
Including 1,684 HMMWVs
Increase from 3135 vehicles in 2008 to over 10,000 Combat Vehicles and related equipment today including 1941 Tanks, 7731 APCs and 133 Howitzers
UNCLASSIFIED
Sierra Army Depot
Opportunities for Added Value to Army Sustainment Operations
51

UNCLASSIFIED UNCLASSIFIED

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