The Army has many characteristics of a business–if its budget were revenue it would be in the Fortune Top 20–but the leader of the land force’s Office of Business Transformation said he doesn’t think the Army is a business.
“I think after due consideration, in the end, the answer to that question must be no,” said Lt. Gen. Thomas Spoehr, in remarks delivered May 28 during the Association of the United States Army’s Institute of Land Warfare breakfast..“The Army’s sacred role is to protect the nation’s interests and the unique nature of the profession of arms transcends what we would consider typical of a ‘business.’”
Photo: U.S. Army
However, for the Army to be successful, it must have “world-class” business practices, because if the service tolerates inefficient business practices, “we risk sending America’s sons and daughters into combat ill-prepared, and I think you all agree that’s unacceptable,” he said i
The service is working to optimize organization and IT portfolios.
To reduce the force as required by the budget and the potential for sequestration, every one of the headquarters commanded by a two-star general and above will be reduced by 20 percent, including Department of the Army headquarters.
As Spoehr pointed out, Chief of Staff Gen. Raymond Odierno has said he believes he has a moral responsibility to reduce non-warfighting organization and functions to the greatest degree possible before another “infantry squad, armor platoon or truck company” is cut.
IT systems are being modernized, he said. “In FY 14 alone we will spend over $2 billion on over 700 business IT systems.”
“By FY 19, by retiring outdated legacy systems and folding capability into our new Enterprize Resourcing Programs, we anticipate driving down our annual IT costs by $600 million to $1.4 billion and shedding 180 systems down to 520,” Spoehr said.
The service also continues to use lean, six sigma, and better buying power efforts to eliminate inefficiencies to save the Army millions every year.
Squeezing the last drop out of the increasingly scarce resources also has resulted in savings both large and small. For example, Spoehr mentioned a smaller effort resulting in savings: $10 million a year in off-post lodging by moving the recruiting and retention school from Fort Jackson, S.C., to Fort Knox, Ky.
Challenges include changing the service culture from one of combat effectiveness to efficiency, where leaders see that money saved contributes to readiness, not only their own, but service wide.
Doing better at strategic planning and performance assessment is another challenge, making it an enterprise-wide competency, he said. Some organizations do this very well, including Army Medical Command and Army Materiel Command.
“The business operations of the Army require the same intense focus as do our warfighting functions and we are applying that commensurate level of effort,” Spoehr said. It is the combined efforts of the military and civilians who get this important work done, he added.