Enterprise Planning Hub
Written by Peter Buxbaum
MIT 2011 Volume: 15 Issue: 9 (October)
In the latest stage of its ongoing effort to implement comprehensive enterprise resource planning (ERP) systems, the Army has initiated an endeavor through which it will develop the expertise to maintain and sustain such systems, performing the role often otherwise played by a systems integrator.
ERP implementations by the Army provide an excellent example of a military organization emulating best practices in the commercial world. As a first step, the Army decided several years ago to forgo custom IT developments in favor of COTS products, in this case from ERP industry powerhouse SAP.
The Army Enterprise Systems Integration Program (AESIP) is instrumental in making these things happen. It acts as a data hub or broker, working to standardize data sets among several systems so that they are understandable and usable by one another.
AESIP also is the moving force behind two contract vehicles through which the Army is managing its several ERP systems, while relying on several small businesses to provide expertise in connection with a series of discreet tasks.
AESIP’s enterprise application services (EAS) contracts “allow the government to act as integrator in support of the AESIP hub,” said Colonel T. Patrick Flanders, the AESIP project manager. “This allows us to grow more of a government competency in SAP, foster a competitive environment, and provide opportunity for small business. Having a government competency is important because it allows us to be informed buyers of the product. The EAS contracts also allow all the ERP programs a contract vehicle to support their development and sustainment needs.”
All of these activities could lead to an eventual consolidation or integration of the Army’s enterprise programs, which include the Logistics Modernization Program (LMP), the General Fund Enterprise Business System (GFEBS), Global Combat Support System-Army (GCSS-A), and several legacy systems.
“The latest contract helps AESIP with its biggest mission to create a convergence of the various ERP systems,” said Ash Kumar, vice president of InSap Services, an awardee of a recent AESIP contract. “Beyond that, government wants to build its own organic capability to manage projects. We believe this is step in the right direction. The government needs the ability to guide the destiny of its projects.”
“The thinking was that the Army would take over,” added Cedric Nash, president and chief executive officer of Oakland Consulting, also an AESIP contract awardee, “and leverage the resources of some small businesses to bring in some more highly specialized talent. The Army is the main integrator and we would be the resource providers.”
The main challenge involved in bringing this scheme to fruition is the process of knowledge transfer, according to Nash. “There are two relevant communities: the end-users who enter the data and run the reports, and the people who set up the system and maintain it,” he explained. “Knowledge transfer involving the training of end-users is very doable. The bigger issue is training people who support the system. It takes a year for those people to be helpful in an ERP environment. They need to understand how and why the system was designed and configured and know how to maintain those things.”
COTS Solution
The Army’s current thinking on implementing ERP began to evolve in 2002, when the assistant deputy under secretary of defense for logistics systems management requested an analysis of whether curtailing the development of a custom military logistics application in favor of adopting a commercial ERP system could be a viable solution for the tactical Army.
“On the heels of similar evaluations in the Navy and at Defense Logistics Agency, the move to a COTS solution sparked interest with respect to adoption of best business practices commonly found in private industry,” said Flanders. “After lengthy analysis, the Army made the decision to move away from custom development and to implement a COTS product. The Army chose SAP.”
AESIP was initiated as a component of the GCSS-A program to be a technical enabler that would act as a broker of master data common to the Army’s several enterprise systems. “In effect, AESIP is a data brokering hub, and is often referred to as ‘the Hub,’” said Flanders.
From 2004 to 2008, the Army analyzed how best to implement GCSS-Army/AESIP. This culminated in a 2008 decision which allowed the program to begin development in earnest. AESIP as an organization does two things: It runs the master data brokering hub, and it provides oversight of the hub, GCSS-Army and LMP product managers. “As a hub, AESIP’s goals are to provide consistent master data to consuming systems throughout the Army, act as a broker for translation services, and to provide enterprise reporting capabilities,” said Flanders.
In its oversight capacity, AESIP’s goals are to provide Army financial auditability, integrated end-to-end logistics business processes, Army business process modernization, and the sunset of legacy systems.
“Master data consists of both logistics as well as financial data,” explained Kumar. “Master data talks about variations of different codes in different systems for equipment such as helicopters, tanks, Bradley vehicles and radios. Logistics systems might talk about these things differently than financial systems. All this needs to be integrated together and consolidated so that the data can be used by the various ERPs.”
ERP data requires certain fields, such as units of measure, vendor pricing conditions and locations where material is shipped from and is to be used. “The idea is to maintain this data centrally,” said Kumar. “AESIP can then push data toward the component ERP, such as LMP and GCSS-Army, that requires them. Consolidating the master data under the AESIP hub will allow the Army to bring uniformity to their ERPs.”
The AESIP hub data is now “live and running” the system of record for Army customers and Army vendors, said Flanders. “It is also live and running the most complete source of materials used by the Army.”
“It is providing translation services for Defense Logistics Management System and Military Logistics Standard conversions. It is the live system of record for the material catalog for the Standard Army Retail Supply System,” which includes all materials used by the tactical Army today, he added.
As a management entity, a role which began in April 2010, AESIP has overseen the third deployment of LMP to approximately 25,000 users, executed another successful milestone of GCSS-Army, and is in the process of cutting over to the second live unit at Fort Bliss, Texas.
“Formal independent testing begins in October,” said Flanders, “and approval by the Department of Defense for worldwide fielding is scheduled to be complete by August 2012.”
AESIP has awarded contracts under two vehicles to companies that will provide services to advance the organization’s missions. Three companies—InSap, Oakland Consulting, and Attain LLC—received awards under the EAS contract.
MTC SPRY LLC, a joint venture of MASAI Technologies Corp. and Spry Methods Inc., and Telesto Group—won enterprise integration services contracts.
“Awardees were selected via small business set-aside, performance- based, competitively awarded contracts,” said Flanders. “All the awarded contracts have a period of performance for a base period of one year, plus four one-year option periods.”
Master Data
Thus far, two EAS task orders have been awarded to support the hub product, specifically in support of master data functionality. Oakland Consulting expects to provide, as part of the EAS contract, business process automation services, applications development, organizational transition and knowledge transfer services. The company will also be supporting the Army’s ERP Center of Expertise at Picatinny Arsenal, N.J.
The establishment of the Center of Expertise is central to the Army’s plans to become its own systems integrator, according to Kumar. “The Center of Expertise was involved with an early SAP implementation,” he said. “It was a smaller level project but the government managed the project very well. Once they understood how to do it they can try to leverage that expertise and extend it to manage larger projects.”
That is the way large corporations sustain enterprise systems, Kumar added. “When they implement ERP they hire a large integrator, but once they go live the organization takes over,” he said. “If the government is able to build the Center of Expertise, then reliance on large systems integrators will be reduced, as will the system sustainment costs.”
One issue is whether the Army might eventually consolidate its ERP systems. The current Army ERP strategy emphasizes “integrating business processes across functional boundaries” rather than consolidating the systems themselves. The strategy also calls for reengineering and improving business operations; instituting a new business management approaches; focusing on enterprise governance and management; managing end-toend business processes; and measuring and monitoring process performance.
“In ERPs, consolidation and integration is typically in the areas of data, communications and the business processes which ERPs automate,” said Flanders. “AESIP is presently enabling the consolidation and integration of many legacy system functions into modernized ERP solutions for logistics and finance. This requires considerable consolidation and integration in an enterprise as large and complex as the Army.”
“Consolidating master data means that the data can be used by all systems,” said Kumar. “You don’t necessarily have to consolidate the systems themselves. Consolidating these various component ERPs would not be easy. All these ERPs perform different functions and have gone through different cycles of development and design.”
Nash sees systems consolidation efforts as a “big ordeal” but added that such an effort could provide the Army with significant benefits. Moreover, there is precedent in the commercial world for such efforts.
Streamlining Processes
Streamlining processes, data and technology in turn allows an organization to concentrate on the decision support capabilities that the systems provide.
“Often, organizations get so bogged down getting the system working that they never get to the point of figuring out what it all means and why it matters,” said Nash. “It can take a while to realize that leaders should only be concerned with a limited number of key performance indicators, which can be displayed on a dashboard on a laptop or mobile device. What matters to an executive is what the key performance indicators say and what they mean and how to make decisions based on them. He should never have to log into a session of Oracle or SAP to get that information.”
As far as the quest to develop organic ERP expertise, the key challenge, according to Nash, will be the knowledge transfer piece. “It has already been proven in the commercial world that the learning curve for ERP is steep at the beginning but that over time those people add significant value,” he said. “There needs to be a dedication to knowledge transfer if they are to get the value they want. That means making sure Army personnel are sitting side-by-side with the implementation consultants and not having to do their regular functional job. Otherwise, there are going to be knowledge gaps.”
Over the coming years, AESIP will continue supporting the translation and interface needs of Army enterprise systems. “As trading partners make changes, like the upcoming consolidation of the DoD Central Contractor Registry and Federal Register systems, AESIP will make modifications to interfaces, syntax, schema and data type” that will be applicable to all Army systems, said Flanders. “This will minimize the impact and costs associated with everyone having to change.”
Over the next five years, Flanders expects AESIP to be instrumental in fielding of a worldwide GCSS-A warehouse and tactical finance replacement capability.
“Full deployment of worldwide maintenance and property capabilities is expected by the end of fiscal year 2017,” he said. “We will also be managing the addition of capabilities to LMP to allow shop floor operations, item unique identification and equipment visibility and will be supporting a clean financial audit capability by 2017.” ♦
