AFMO. Army Financial. Management Optimization. Driving Change in Financial Management across the Army Enterprise

Transcription

1 AFMO Army Financial S Management Optimization Driving Change in Financial Management across the Army Enterprise Army Financial Management Optimization 1

2 The changing world around us We live in a changing and competitive world... Our force of the future has to be as great, if not even better, than our outstanding force of today. Our (national) security depends on it. Secretary Carter, November 2015 Developing a lethal, professional and technically competent force requires an openness to new ideas and new ways of doing things in an increasingly complex world. We will change and adapt. CSA Milley, August

3 Meeting the challenge of the changing world around us Achieve efficiencies and effectiveness to redirect resources to direct support of combat, combat support, and combat service support elements of the DoD. Improve financial processes, controls, and information via audit readiness. Establish an enterprise framework for valuation and accountability of results, outcomes, cost, and risk. Strategic Objectives of Goal #5: Reform and Reshape the Defense Institution, DoD Agency Strategic Management Plan July

4 Meeting the challenge of the changing world around us By informing decisions with performance management the DoD leadership is empowered to focus on both efficiency and effectiveness to build value across the department. DoD Agency Strategic Plan , 31 July 2015 I think the value of doing the audit is better information for decisions, but also better use of the resources and better outcomes. We are moving from a budget culture of "get the money executed" [to] a cost culture of "what is the outcome for the dollars that you execute." So the real outcome of [AFMO] is... better financial data for the decision-maker... and outcomes... we expected and asked Congress for the money for. HON Robert M. Speer, Assistant Secretary of the Army (Financial Management & Comptroller), April

5 Why Army FM Optimization? The FM Strategic Environment Army Enterprise Resource Planning (ERP) Systems Internal and External Influencers Desired Outcome Four Technologies Advancing the Force Integrated Personnel and Pay System Army (IPPS-A) General Fund Enterprise Business System (GFEBS) Global Combat Support System Army (GCSS-A) Logistics Modernization Program (LMP) + - Auditability by FY17 Congressional Mandate - Shrinking budgets Budget Control Act of Shrinking Army forces = military & civilian reductions - Demand for more Readiness inside smaller force with fewer resources years of War - Cost Management tools for analytics to support decisions =... more efficient and effective use of resources to achieve Army outcomes. 5

6 Army FM Optimization Campaign Plan What is it? A holistic approach to change management integrating financial management across the Army toward improving support to the warfighter Who does it pertain to? Financial managers engaged in resource and financial operations support Why do we need it? To effectively integrate efforts toward meeting auditability goals and improve effective use of limited resources to Army priorities Directed by the Secretary of the Army, Army Financial Management Optimization Supports the Army of 2025 and Beyond 6

7 How Does AFMO Support Army of 2025 and Beyond? Innovative FM enterprise solutions resourcing the Army of 2025 and Beyond*, enabling the essential qualities of ready Army forces that are: Agile Expert Innovative Interoperable Expeditionary Scalable Versatile Balance Agile, resource-informed decision support to commanders Increased full spectrum FM capability at reduced cost Dynamic costing of the full readiness life cycle Fully certified professional workforce experts in the ERP environment Enterprise solutions for Joint, Inter-organizational, Multi-national land operations * Source: The Army Vision 7

8 AFMO Campaign Plan Outlook...integrated effective and efficient end-to-end financial management enterprise operation, optimized to provide necessary resources to meet the Army s missions with proper stewardship and accountability of resources and providing accurate and timely financial information and analysis for actionable decision making that will receive a favorable Financial Statement clean audit opinion. Like the Army s journey to Army 2025 and Beyond, AFMO does not envision an end AFMO will continue to frame change management as we adapt to a changing Army inside a changing, complex world. 8

9 AFMO Campaign Objectives Public confidence in stewardship of DoD resources is high Business processes are standardized and auditable across the Army Automated Internal Controls systems are implemented throughout the FM environment CO 1 Achieve and Sustain Auditability CO 2 Deliver FM Operations Efficiently and Effectively Systems & processes are standardized & integrated by trained people in all FM operating environments FM Organizations are high performing Governance, decision and communication support are aligned Standardized Business Analytics are integrated leveraging breadth of financial cost data Business Intelligence (BI) capability delivers advanced analytics to commanders Improved decision making creates value capacity for commands and customers CO 4 Provide Financial Information and Business Analytic Support for Improved Decision Making CO 3 Improve and Sustain Operational Readiness in FM Elements FM Elements have access to enabling ERP systems FM Elements are high performing in any business or operating environment FM Elements are integrated with Home Station Mission 9

10 Driving Change in Financial Management across the Army Enterprise Strategic Environment AFMO Campaign Plan LOE 1: Systems Domain LOE 2: Business Processes LOE 3: Organizations LOE 4: FM Professional Workforce LOE 5: Internal Controls Environment LOE 6: Army Cost Framework LOE 7: Strategic Management & Communications AFMO Objectives (1) Achieve and Sustain Auditability (2) Deliver FM Operations Efficiently and Effectively (3) Improve and Sustain Readiness in FM Elements (4) Provide Financial Information and Business Analytic Support for Improved Decision Making AFMO End State An integrated effective and efficient end-to-end financial management enterprise operation, optimized to provide necessary resources to meet the Army s missions with proper stewardship and accountability of resources and providing accurate and timely financial information and analysis for actionable decision making that will receive a favorable Financial Statement clean audit opinion. 10

11 LOE 1: Systems Domain Increment 1 fully deployed Consolidates Army General Fund (GF) data for reporting, management and audit Deploying worldwide by 2017 Source of supply, maintenance and property book transactions Leverages GFEBS financial template Interfaces with GFEBS for GF execution ~ 75 legacy FM Domain systems Beginning development Includes secure capabilities Will interface with GFEBS Fully deployed to depots & PEOs Enables some GF Procure-to-Pay and Asset Accounting processes Interfaces with GFEBS to trigger GF posting Fielding ~ 2020 Will provide military pay capability Will be source of pay transactions Will interface with GFEBS to trigger GF posting Legend: Global Combat Support System-Army (GCSS-A) Logistics Modernization Program (LMP) Integrated Personnel & Pay System-Army (IPPS-A) 11

12 LOE 2: Business Processes As-Is Process Through Business Process Reengineering processes are standardized for efficiency and effectiveness. Systems technological capabilities are leveraged and optimized. Decomposed To-Be Process - Understand ERP opportunities - Reduce legacy systems - Exploit system capabilities Goal: Standardized business processes are critical to achieving audit readiness. Standardization is enhanced through use of ERP IT capabilities. 12

13 LOE 3: Organizations US Army Financial Management Command (USAFMCOM) USAREUR EUCOM AFRICOM USARAF FORSCOM XVIII Corps I Corps III Corps USARC The Army s Financial Management Enterprise Operational Headquarters Systems Support Oversight Systems oversight/management Functional financial analysis support Cost Management support Pilot Sites OCONUS FMSOC CONUS FMSOC USAFMCOM CSM Deputy to the Commander for Field Operations Systems Support Operations (SSO) FMSOCs Commanding General Financial Management Support Operations Center Standardize processes Improved performance Reduce errors/re-work efforts Special Staff Deputy to the Commander for Financial Management Operations Army Financial Services (AFS) Financial Audit & Compliance (FAC) Key USAFMCOM Outcomes: FM systems support Process standardization Auditable financial statements Financial Audit & Compliance Audit compliance Training Monitoring Mid Term Focus Areas Exists In USAFMCOM Near Term Focus Areas 13

14 What is the AFMO Pilot? The AFMO Pilot explores improved standardization of transactional work, centralized to build expertise, reduce errors and improve audit readiness. Simultaneously, command RMs achieve enhanced capacity for analysis supporting optimizing resources toward command priorities. Financial Management Support Operations Center (FMSOC) Outcomes: Standardized business processes Reduced errors and rework Centralized support more expertise at reduced cost Systems integration (ERPs IPPS-A, GCSS-A, etc.) Training opportunities for BC36 soldiers build FM readiness DFAS CONUS FMSOC Ft Bragg USAFMCOM OCONUS FMSOC Germany HQDA TBD Operating Agencies (OA) and Fund Centers (FC) Command Support Outcomes: Increased decision support capacity Agility in influencing current year execution; optimize toward readiness Increased cost management Systems integration (ERPs IPPS-A, GCSS-A, etc.) Training opportunities for BC36 soldiers build FM readiness 14

15 LOE 4: FM Professional Workforce GOAL The Right People, At the Right Place, With the Right Skills, Trained and Certified Certification Leadership FM leadership competencies & talent Standardized DoD FM competencies to guide training and development Training Multi-disciplined training, OJT, customer focused, technical systems Organization Right mix of civilians and military, job series, grades and structure Our people are the key to continued success through enterprise Talent Management and validated workforce professional skills at all levels 15

16 LOE 5: Internal Controls Environment Priorities Actions Goals Statement of Budgetary Resources (SBR) Funds Receipt, Dist., and Monitoring Payroll (Civ. & Mil.) Acquisition of Assets Reimbursable Inbound Grants, Cooperative Agreements, Subsidies, Contributions, and Advances FBWT / Disb. & Collect. Financial Reporting Contractual Services/ Acquisition of Assets: - Reimbursable Out (MIPRs) - Purchase Cards - Supply Requisition - Contracts - Other Existence and Completeness (E&C) of Assets & Liability General Equipment (GE) Operating Materials and Supplies (OM&S) Real Property (RP) Inventory Other Balance Sheet Items Enterprise Resource Planning (ERP) Systems General Fund Enterprise Business System (GFEBS) Global Combat Support System Army (GCSS-A) Logistics Modernization Program (LMP) Integrated Personnel and Pay System Army (IPPS-A) Material Feeder Systems * The Federal Financial Management Improvement Act, and Federal Information System Controls Audit Manual Establish effective control environment Assess documentation & processes Implement corrective actions Assess financial statement data for accuracy Assess system controls Correct control deficiencies Standard processes Effective internal controls Proper documentation Accurate, timely, reliable and supportable financial data 16 Information is timely, accurate, relevant Army is auditable Compliant Systems (FFMIA, FISCAM*)

17 LOE 6: Army Cost Framework Resource Informed Decision Making Managing business operations efficiently & effectively through accurate measurement & understanding "Full Cost" of an organization's business processes, products & services to provide Best Value. Cost Planning Set Cost Targets and Efficiency Goals Compute Standard Rates Capture and Valuate Data Accurate, timely and relevant data operational output/performance data tied to financial data Allocated Overhead Cost Controlling Adaptability based on analysis Change targets Change resources Change quality Cost Analysis Variances Depreciation Trends and forecasting Cost by element (labor, contract etc) Understanding full costs of organizations, operations, products and services 17

18 LOE 7: Strategic Management and Communications Resources to Win in a Complex World Achieve and Sustain Auditability Deliver FM Operations Efficiently and Effectively Provide Financial Info and Analytic Support for Improved Decision Making Improve and Sustain Operational Readiness in FM Elements Driving Change in Financial Management across the Army Enterprise 18

19 What are the Benefits of AFMO? Better decision support to commanders Standardizes processes and systems controls to improve audit readiness Leverages Army FM workforce and maximizes ERP systems to optimize and streamline financial operations Improves oversight of Army enterprise-wide Financial Management operations Acknowledges key role of highly skilled workforce in shaping financial management change adapting to a changing Army Ultimately, AFMO frames the path to achieving audit readiness, building value across the Army to direct more resources to core mission priorities. 19

20 What Can I Do? Assess business practices and processes streamline and standardize Understand ERPs and controls, explore untapped capabilities for standardization Train and certify your team in the right skill sets and job series Share lessons learned from getting Audit Ready Increase cost analytics in the Commander s decision-making process Demonstrate ability to optimize resources toward mission priorities CO 1 Achieve and Sustain Auditability CO 4 Provide Financial Information and Business Analytic Support for Improved Decision Making CO 2 Deliver FM Operations Efficiently and Effectively CO 3 Improve and Sustain Operational Readiness in FM Elements To achieve audit compliance and improve support to commanders, we must change and adapt to the changing, complex world around us. 20

21 Questions? "Change is hard because people overestimate the value of what they have and underestimate the value of what they may gain by giving that up." - James Belasco and Ralph Stayer Flight of the Buffalo (1994) "After living with their dysfunctional behavior for so many years (a sunk cost if ever there was one), people become invested in defending their dysfunctions rather than changing them." - Marshall Goldsmith Mojo 21

22 Questions? For more information please contact: COL John Vogel (703) COL Andrew McConachie (703) (301) LTC Claire Lindley (703)