Defense Agencies Initiative (DAI) Ms Cynthia Beck, PM 17 April 2013

Problem Statement "Currently, Defense Agencies use more than 10 different non-compliant financial management systems supporting diverse operational functions and the warfighter in decision making and financial reporting. These disparate, non-integrated systems do not meet statutory requirements to produce timely, auditable reports.“ Source: DLA Operational Execution Plan Brief Updated July 31, 2012 2

Milestone Decision Authority DAI Overview Mission: To transform the budget, finance, and accounting operations of the Defense Agencies to achieve accurate and reliable financial information in support of financial accountability and effective and efficient decision making throughout the Defense Agencies in support of the missions of the warfighter. Common business processes are: procure to pay; order to cash; acquire to retire; budget to report; cost accounting; time and labor. Full deployment capability will include budget formulation; grants financial management; and re-sale accounting. Objectives: Achieve auditable, CFO compliant business environments for the Defense Agencies Meet or exceed capability requirements to include key performance parameters on cost and within schedule Stakeholders Type OUSD(C) PSA & Customer Defense Agencies Partners DCMO Milestone Decision Authority DLA Component Acquisition Executive Program Executive Officer

Additional Attributes Benefits DAI is a fully functional ERP suite which has been configured and adapted to meet the requirements of the Defense Agencies. Achieved benefits include: Full USSGL/SFIS Compliant Accounting – support for both general fund and working capital fund accounting requirements Complete Subledger Transaction Processing – end to end procure-to-pay support from request to contracting through entitlement, reimbursable order processing, financial asset accounting, time and labor entry Robust System Interfaces to DoD and Agency Systems – Automated interfaces for ADS, CCR, DCAS, DCPS, DCPDS, DDRS, DTS, WAWF, EUD, PRIDE, IPAC, 1099, ODS, PCard, CEFT, FPDS-NG and others Reporting Infrastructure – complete SFIS fiduciary reporting via DDRS, tailorable managerial reporting with Project Accounting, ad-hoc query capability Compliancy with Key Governance Requirements – audited validation of accounting model, SFIS, FFMIA, BEA Other Benefits Additional Attributes Implementation of a single OFFM compliant solution for the Defense Agencies helps address financial management material weaknesses and deficiencies. Real time access to data supports enhanced financial analysis and timely decision making. Reduced data reconciliation requirements…more time for analysis/production. Retire Legacy Systems. Accessibility: Interoperability: Data Retention: Supportability. Search Driven Information: DAI helpdesk Audit Trail: Continuity of Operations Plan (COOP) Confidentiality. Common Operating Environment Availability. Availability Software Maintainability: agreements. Human/Computer Interface (HCI): On-line Notification: On-line Information (Help) 4

Global Model Initial General Fund Capability Updated: 31 Dec 2012 Cost Management (CM) (Cost Accounting) Collection of all costs such as: Activity Based Cost, Job Order Number, Process costs and Standard costs Allocation of indirect costs Working Capital Fund Update general ledger Update reports Order to Cash (O2C) Set up agreements Collect cost and calculate bill Working Capital Fund Billing and collection Update general ledger Update reports Legend: BEA E2E Business Processes Other Business Processes Delivered capabilities Future capabilities Budget to Report (B2R) Enter funds from Treasury Allocate funds to organizations Working Capital Fund Update general ledger Update reports Cost Accounting Order to Cash Procure to Pay (P2P) Create commitment Create obligation Perform receipt & acceptance Working Capital Fund Update general ledger Update reports Advanced Procurement System Budget to Report Initial General Fund Capability Telecom Working Capital of Revolving Funds Budget Formulation (additional B2R process capabilities) Develop budget for out year and POM Support forecasting, and “what if” scenarios Generate required documents Initial General Fund and Working Capital Fund Capabilities Procure to Pay Budget Formulation Acquire to Retire (A2R) Define asset Determine in service date Determine depreciation Update general ledger CIP & WIP Reporting Update reports Retirement of asset Acquire to Retire Proposal to Reward (P2R) (Grants Financial Management) Award a Grant Apportion and allotment funding Track and close grant Oversight and reporting Grants Financial Management Time & Labor Re-sale Accounting Hire to Retire (H2R) (Time and Labor only) Automated individual or timekeeper input into system Time allocation for Cost Accounting purposes Automatic generation of time cards Re-Sales Accounting (DeCA Unique) Non-Appropriated Fund FFMIA requirements Perform accounting for the DECA inventory and any other Agencies that have inventory for sale

Transformation Tenets … Keys to Success DAI History Transformation Tenets … Keys to Success We will change, not the COTS We will rely on commercial software and use successful BPR We will operate in a single Solution We will prepare our people to succeed in the new environment 8,400 9,200 Agency users/FY 5,700 274 398 6

Activity Throughput $s in M Transactions: 9K 36K 133K 261K 164K

FY13/14 Business Process Reengineering Areas Areas Funds Availability – Projects/GL System Development Life Cycle maturation Streamline New Agency Implementation - learning from lessons Help Desk Improvements Standard Line of Accounting (SLOA)/ Government Wide Accounting by 30 Sep 2014 P2P eCommerce Metrics About 14 metrics including: PALT, electronic/manual invoices, interest, invoices on hold, etc.

DAI Implementation Life Cycle Phase 0: Initiation Phase 1: Planning Phase 2: Preparation Phase 3: Cutover Phase 4: Stabilize Phase 5: Operate Process Mocks DAI Solution Implementation and Sustainment Process Mocks DO DI ASR Test Re-Test Solution Implementation Planning Solution Preparation & Testing Solution Cutover Solution Support Routine Operations Agency Human Performance and Sustainment Change Management Planning Change Management Preparation Workforce Support & Capability Maintenance Executive Alignment & Commitment Agency Data Conversion and Maintenance Data Conversion Planning Agency Data Preparation Agency Data Conversion Agency Data Maintenance Agency Infrastructure Preparation and Maintenance Infrastructure Preparation Planning Infrastructure Preparation & Testing Infrastructure Maintenance Implementation Management Program Governance 10

DAI Lessons Learned DAI is more than a financial system - it is a core business system– Particularly Procure to Pay (P2P) and requires Contracting Office (and more broadly, Acquisition) involvement Business Process Redesign Using DAI – Implementing DAI will challenge how you are currently processing your business, the key is to understand it and adjust your business processes to fully leverage it! Practice Makes Perfect – DAI PMO is making an instance of DAI available as soon as possible for the Agency to practice and become familiar with the application. The more practice the better! Communication – Must ensure that there is constant communication between the Agency, DFAS and the PMO pre and post-production. Communication internal to the Agency and its users as well as the business partners external to the Agency Executive Sponsorship – Assigning an Agency executive to be the advocate for DAI within the Agency has proven to lead to successful deployments Help Desk/Subject Matter Experts/Training – It is recommended that agencies assign a set of individuals that will become subject matter experts in DAI and be available for training and help desk Reports – Get familiar with OBIEE and the standard reports offered by DAI before user acceptance testing Time and Attendance – Agencies should deploy the DAI time and labor module at least 2 pay periods prior to deployment of core financials Post Implementation Support – Start planning for post implementation support early. Establishing a help desk and a core group of subject matter experts is critical

FOR OFFICIAL USE ONLY ( ) Ms. Cynthia Beck 703.602.8736 Cynthia.beck@dla.com

DEFENSE LOGISTICS AGENCY AMERICA’S COMBAT LOGISTICS SUPPORT AGENCY WARFIGHTER SUPPORT STEWARDSHIP EXCELLENCE WORKFORCE DEVELOPMENT 13