iStock/LightFieldStudios

Why It’s Time to Upgrade the DOD’s Financial Management Systems

From operational visibility to happier staff, cloud-based ERPs could be the key to transforming the Defense Department’s financial management systems for the better.

Presented by Salesforce Salesforce's logo

Anyone waiting for their next paycheck or for budget approval on their latest project will tell you that while financial systems may seem to sit in the background of defense functions, they are, in fact, the lifeblood of every mission. Today, as digital transformation takes hold across the  Defense Department, systems are becoming more interconnected, making it critical for the organization to tap modern, digital technologies that can improve financial management processes and keep pace with the speed of innovation.

“Financial management is a service delivery business, and the mission area grows as the businesses they serve continue to grow,” explains Jonathan Moak, former acting assistant secretary of the U.S. Army for Financial Management and Comptroller, who now serves as vice president of Strategy & Business Development at Salesforce. “While in the past they may have operated independently, things are now changing.”

Indeed, the government at large has determined it’s time to overhaul the DOD’s financial systems: Per the National Defense Strategy, the DOD has been tasked to reform its financial management Enterprise Resource Planning systems, or ERPs, to be more standardized and data-driven. But these changes are not simply to keep pace with modernization; they are also meant to address the ongoing challenges that accompany today’s highly customized systems.

“Over time, the DOD has implemented an array of customized technologies to meet financial management and asset management needs, and the reliance on that customization has led to technical and functional debt that raises the sustainment cost,” says Moak. “It also has the potential to introduce information security vulnerabilities.”

Moreover, as experienced and highly skilled IT staff reach retirement age, the DOD is finding it increasingly difficult to find personnel with the know-how necessary to maintain the aging systems, leading to major talent shortages.

“Ultimately, these on-premises, custom-code models just aren’t sustainable, it becomes too costly and difficult to maintain them in the long run,” says Moak.

The Advantages of Modern ERPs

To move toward more sustainable, cost-effective and user-friendly financial management ERP systems, the DOD will need to look to adopt commercial technologies, such as cloud computing, big data analytics and even artificial intelligence, at a more rapid pace.

“As technology’s rate of change accelerates, we must enable technology advancement by taking advantage of existing ‘out of the box’ cloud Software-as-a-Service and Low Code Platform-as-a-Service solutions,” he says. “The cloud-based systems are flexible. They reflect modern innovation, and they really start to help us untangle the legacy ERP FM and asset management systems.

Moak notes that this helps align these systems with the National Defense Strategy in a number of ways: stewardship of public trust or the taxpayer funds, sustainable auditability and improved insight into financial management transactions.

By tapping these cloud-based platforms, the DOD can make use of emerging technologies like AI and analytics to gain a number of benefits, including:

  • Flexible and adaptable processes: Many of today’s systems are siloed, complex, costly to maintain and not flexible enough to adapt to new processes. With PaaS tools that can offer rapid application development, the DOD can quickly configure and develop the highly responsive and modern applications they need. And, according to Moak, IT managers can also design applications for specific needs without having to code every element, saving time and resources.
  • Process transparency: Visibility into operations and assets isn’t just important for the DOD, it’s foundational when it comes to introducing more automated processes. But transactional systems don’t always offer full insight into process effectiveness. With as-a-service platforms, the DOD has access to the end-to-end support they need to gain visibility into their systems to better manage the people, processes and technology that make missions successful.
  • Fewer silos, more integrated data: It’s no secret that big organizations like the DOD struggle with data sharing, meaning decision-makers often don’t have access to all information the organization holds. But cloud-based ERP systems, unlike their predecessors, are flexible, functional, and built to battle information silos by integrating information and creating a full picture of data that can measure up to modern mission demands.
  • Data-driven decision making: Modern ERP systems also bring together financial data in a way that enables analytics, offering DOD leaders the opportunity to gain new insights into people and materials regardless of location, across functions and across time. This ultimately enables data-driven decision-making and increases mission readiness. Analytics can also measure and monitor performance and readiness in real-time


“Ultimately, these systems support the warfighter through faster and more efficient transactions and by better securing data on their activities,” explains Moak. “They allow for more authoritative, accurate and timely information for decision-making for senior leaders.”

The result, he explains, is a well-trained, informed and productive workforce that's excited about their work because the technology frees up time, enabling them to focus on higher-priority initiatives.

Starting the Financial Management Modernization Journey

While modernizing is important, it also requires careful planning, expertise and execution. This is especially true for organizations like the DOD, who’s financial management IT landscape is composed of over 340 financially relevant account and business systems and a workforce of around 54,000 civilian and military personnel across various disciplines. Not to mention that many feeder systems are currently undergoing planned migrations.

While financial management is certainly a challenge, it also presents the DOD with an unprecedented opportunity to transform their systems to not only meet upcoming functional and IT requirements, but to transition systems to ones that are more collaborative and integrated.

So how can DOD IT leaders get started? The first step, according to Moak, is to recognize that current systems aren’t working effectively — and to commit to cloud systems as a potential solution.

“The first step is admitting you have a problem,” says Moak. “Identify the problem and then decide to use cloud services as your strategy.”

To create an effective strategy, the DOD will need to call on expertise from both industry and government.

“When you're making the decision to move to a cloud service software or platform, there are some questions you should ask yourself: Why are cloud services important to my agency? What's the right mix of those cloud services and how can my agencies safely migrate to cloud platforms? You want to think about the answers to those questions before you get started because the decision to use cloud services is not the strategy,” says Moak. “That's just the first step.”

To take advantage of this, the DOD will need to call on expertise from both industry and government to create a solid, effective transformation strategy, because modernization is certainly not a one-size-fits-all approach.

“A successful cloud transformation really requires tactical planning of what to move and when, plus a look at long-term changes to culture and operating models, because you really can’t leave out the people aspect of that change,” says Moak. “It takes a lot to convince your staff that there's a need to change, and that you're going to give them the skills and prepare them for this future environment. So keeping them in mind and deploying rapid, user-friendly technologies that allow them to work most effectively is key.”

Learn more about how Salesforce can help to transform the DOD’ financial management systems.

This content is made possible by our sponsor Salesforce; it is not written by nor does it necessarily reflect the views of Defense One's editorial staff. 

NEXT STORY: The Best of Webex, Now for Defense

X
This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
Accept Cookies
X
Cookie Preferences Cookie List

Do Not Sell My Personal Information

When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

Allow All Cookies

Manage Consent Preferences

Strictly Necessary Cookies - Always Active

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data, Targeting & Social Media Cookies

Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

Save Settings
Cookie Preferences Cookie List

Cookie List

A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

Strictly Necessary Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Functional Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Performance Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Social Media Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Targeting Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.