Continuing DFAS Transformation: BRAC and Beyond

1. Integrity - Service - Innovation Continuing DFAS Transformation:BRAC and Beyond Zack E. Gaddy Director, Defense Finance and Accounting Service August 23, 2007

2. 2/15/2012 Integrity - Service - Innovation 2 Agenda DFAS Mission Why Transform? Transformation Blueprint BRAC 2005 Update Managing DFAS Transformation People Structure Process Technology Information Summary

3. 2/15/2012 Integrity - Service - Innovation 3 DFAS - What We Do

4. 2/15/2012 Integrity - Service - Innovation 4 Why Transform? Our Customers Expect Accurate and timely payment of personnel Accurate and timely payment of vendors and contractors Auditable financial statements Business intelligence that enables better decision-making Lower cost of products and services Transformation includes Proactive planning for the future Emphasis on �best value� solutions Agility to address to Department and customer objectives Employee participation � innovation and process improvement

5. 2/15/2012 Integrity - Service - Innovation 5

6. 2/15/2012 Integrity - Service - Innovation 6 Structure - 2005 BRAC Law Grow the DFAS site at Cleveland, OH, to not less than 1,500 Full Time Equivalents (FTEs) Grow the DFAS site at Limestone, ME, to not less than 600 FTEs Grow the DFAS site at Rome, NY, to not less than 1,000 FTEs Maintain not less than the current FTEs1 at the DFAS sites at Columbus, OH (2,064 FTEs), and Indianapolis, IN (2,632 FTEs)

7. 2/15/2012 Integrity - Service - Innovation 7 Status of DFAS Site Closures

8. 2/15/2012 Integrity - Service - Innovation 8 Managing DFAS BRAC 2005 Initiative Proactive Planning and Analysis First DoD approved Business Plan Includes workload migration, workforce transition, investment costs and projected savings data Critical planning and schedule data maintained on web-based project management tool Disciplined project management process Monitor execution and impact of �fact of life� changes Address interdependencies between BRAC projects and other (internal and external) Transformation initiatives Collaborate effectively with customers at all levels Care of Our Employees Comprehensive effort to encourage employees to relocate with work Upgrade employee skills and competencies (all functional areas) Maximum support for employees in (non) DFAS transition

9. 2/15/2012 Integrity - Service - Innovation 9 BRAC Workforce Impact for Sites Closed in FY 2006 and FY 2007

10. 2/15/2012 Integrity - Service - Innovation 10 Beyond BRAC: Transformation Initiatives

11. 2/15/2012 Integrity - Service - Innovation 11 DFAS Transformation Lifecycle Model Integrated Master Plan and Integrated Master Schedule Support Initiative Management: IMPACT: How important is the Initiative to achieving Transformation goals? COMPLEXITY: How difficult is it to manage the Initiative? MATURITY: What is the capability of the team managing the Initiative? STATUS: What is the timeline and resource usage of the Initiative?

12. 2/15/2012 Integrity - Service - Innovation 12 Managing multiple, complex Transformation events requires: Assessment of each initiative against each sector of the blueprint model Ability to forecast resource, performance, and schedule implications, including intellectual capital requirements to sustain momentum and achieve outcomes

13. 2/15/2012 Integrity - Service - Innovation 13 DFAS Transformation People Structure Process Technology Information

14. 2/15/2012 Integrity - Service - Innovation 14 People - Human Capital Strategy Current 20 sites 12,788 employees Transaction oriented Skill based Management directed Process-oriented Leadership succession plans GS pay system Reactive culture Stove-piped information flow Target 10 sites <10,000 employees Consultative (business intelligence) Competency based Self-directed Results-oriented Cascading succession plans NSPS performance system Proactive culture One-DFAS information flow

15. 2/15/2012 Integrity - Service - Innovation 15 Structure - DFAS Centers of Excellence

16. 2/15/2012 Integrity - Service - Innovation 16 Process - High Performing Organizations (HPOs) Implement standard and improved processes to achieve efficiencies Creating streamlined end-to-end processes to eliminate redundancy, increase efficiency, and enable customer savings Accounting HPO Impacts approximately 7,000 DFAS personnel Currently under implementation Accounting HPO Limestone Pilot Impacts approximately 600 Full-Time Equivalents (FTE�s) Implementation planned for 1st quarter FY 2008 Contract Pay HPO Study Impacts approximately 500 personnel Leverages Accounting HPO concept and structure to transform Contract Pay business area

17. 2/15/2012 Integrity - Service - Innovation 17 Process � EMS & FM COEs Leverage Business Outcomes DFAS Enterprise Resource Management Services (EMS) Project Management Capability with training, tools, consulting support for Agency project management offices FY 2007 PM COE Projects; focus on targets of opportunity with maximum resource and performance impact Risk Management/ Process Management Enterprise Risk Management Program (ERMP) Business Activity Monitoring (BAM) Financial Management COE, DFAS Strategic Business Management Functional architecture; Systems requirements building and approval Standard interfaces Standard Testing Training and Implementation Integration

18. 2/15/2012 Integrity - Service - Innovation 18 Technology - Scope of DFAS Engagement in Changing Financial Management

19. 2/15/2012 Integrity - Service - Innovation 19 Information Integrated Master Schedule Business Intelligence (BI) Global War on Terror (GWOT) MyPay Virtual Keyboard Benchmarking Information Security MyPay Virtual Keyboard Data Encryption

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