0. General Fund Enterprise Business System “Leading Edge on Cost Management using New ERP’s”
Workshop 77
3 June 2010

1. What is the General Fund Enterprise Business System?
GFEBS is an …
Accounting system that–
Complies with statutory and regularity requirements for funds control and accounting
Includes real property and other asset data for accountability
Management information system that –
Records financial and various other transactions in a single system
Provides visibility of transactions in real time across the Army
Decision support system that –
Provides full cost data
Provides comparative, trend and other analytic data
Enables well-informed decisions to leverage available resources and to improve program and budget decisions
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2. Where We Are and … Where We Are Going
GFEBS Solution
Current Situation
Implements a single web-based system
Standardizes processes Army-wide
Implements standard data structures
Records transactions in real-time and provides real-time access to data
Integrates financial and non-financial/ performance data from functional areas
Applies commercial-off-the-shelf (COTS) Enterprise Resource Planning (ERP)
Complies with DoD’s Business Enterprise Architecture (BEA)
Involves maintaining many systems
Requires many costly interfaces
Requires entering data in several systems
Inhibits efficient sharing of data
Impedes producing comprehensive and accurate decision data
Hinders responding timely to questions
Requires time-consuming and costly reconciliations
SAP
System View (SV) 1
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3. General Fund Enterprise Business System Overview
Army Reserve
Army
National Guard
Active Army
Transactions in…
Reports and
analyses
GFEBS will process
a million transactions a day and …
… provide essential data to transform the Army to a cost culture
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As of 31 Dec 2009

4. Project Status (As of May 2010)
Received Milestone B approval – 14 Mar 08
Successful Release 1.2 & “Go live” – 1 Oct 2008
Fort Jackson, SC and 7 other locations
Favorable Operational Test Agency Limited User Test assessment – 12 Dec 08
Successful Release 1.3 & “Go live” – 1 April 2009
Forts Stewart, Benning and related organizations
Successful Milestone C Approval – 30 May 2009
Successful Release 1.4 & “Go live” – 10 Oct 2009
Successful “Mini Go live” – 1 Jan 2010
MEDCOM Fort Benning and related organizations
Successful Wave 2 “Go live” – 1 Apr 2010
Organizations at 9 Forts plus other organizations
Successful Release – 19 Apr 2010
Approximately
250 Users
Approximately
1,400 Users
Approximately
120 Users
Approximately
3,700 Users
GFEBS software release delivery and
Wave deployment are on schedule
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5. GFEBS Has A Sizeable Footprint
End Users: 5,500
(most common)
Accountant
Budget Analyst
Engineers
Health Specialist
IT Specialists
Legal Admin
Logistics Supervisor
Operations Analyst
Program Manager
Property Manager
Purchasing Agent
Quality Assurance Specialist
Resource Manager
Staff Assistant
Supply Technician
Sites:
Ft Jackson
Ft Stewart
Ft Benning
Ft Bragg
Ft Campbell
Ft Drum
Ft Gordon
Ft Knox
Ft McPherson
Ft Polk
Ft Rucker
Army National Guard, KY
DFAS-Indy & Rome
Commands:
IMCOM
TRADOC
FORSCOM
Accessions Command
MEDCOM
NETCOM
USARNG
DFAS
HQDA
Full deployment
by 2nd Quarter FY 2112
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6. GFEBS Integrates Data From Across The Army
Institutional Generating Forces
Operating Forces
Human
Capital
Readiness
Organize and Train the Force
TDA
TOE
... provide and sustain dominant land forces
Command
Subordinate
level
Corps
Division
Brigade
Battalion
Company
… conduct prompt and sustained combat operations on land
Services
&
Infrastructure
Materiel
GFEBS integrates cost and output data from:
Active, Army National Guard and Army Reserve forces
Generating/ institutional and operating force
Army Command (ACOM) (3): * Forces Command (FORSCOM); reviewed * Training and Doctrine Command (TRADOC); * Army Materiel Command (AMC). Army Service Component Command (ASCC) (8): * United States Army Central (USARCENT); * United States Army North (USARNORTH); * United States Army South (USARSO); * United States Army Europe (USAREUR); * United States Army Pacific (USARPAC); * Eighth Army (EUSA); * United States Army Special Operations Command (USASOC); * United States Army Space and Missile Defense Command/ US Army Forces Strategic Cmd (USASMDC/ARSTRAT). Direct Reporting Unit (DRU) (11): * Network Enterprise Technology Command (NETCOM); * Medical Command (MEDCOM); * Intelligence and Security Command (INSCOM); * United States Army Criminal Investigation Command (USACIDC); * United States Army Corps of Engineers (USACE); * Military District of Washington (MDW); * Army Test and Evaluation Command (ATEC); * United States Military Academy (USMA); * United States Army Reserve Command (USARC); * Acquisition Support Center; * Installation Management Command (IMCOM
Includes performance and output data
from across the “enterprise”
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As of 23 Feb 2010 6

7. GFEBS Provides New Cost Management Capabilities
Brigade data may be for:
specific brigade
average Bde in command
average Bde across
the Army
Personnel
Military -
$ / Soldier
Civilian
$ / FTE
Contractor
Base Support
$ / Service
$ / Brigade
$ / Installation
Training (Ind)
$ / Student Tng Day
$ / Course Day
Training (Unit)
$ / Mile
$ / Flying Hour
$ / Weapon System
Equipment
New
Conversion
Ratio: Spt $ / Brigade $
Force Generation
$ for Reset
$ for Ready/Train
$ for Available
Heavy X
Light
Stryker
SUST
FCS
Bde
ARFORGEN data may be for:
specific pool, e.g., Ready
specific function in pool
average Bde in pool
Functional data may be for:
total cost for school
total cost for course
specific costs of
interest
Introduction to concept of COST data versus simple expenditure data
Cost of BDE to the Army is the sum of expenditures across the Army–
Individual training -- typically TRADOC
Unit training -- typically FORSCOM, USAREUR, ARNG, etc.
Base Support – typically IMCOM
Equipment – typically AMC
Personnel – from centrally management MilPer
Flexible and responsive
to Army information needs
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As of 7 Jan 2010 7 7

8. GFEBS Data Provide Opportunity For Analysis
Many Types of Analysis
Most Decision Processes
Comparative, e.g. --
What did NTC rotations cost?
Trend, e.g. --
What are property maintenance trends Army-wide and at xyz?
Predictive, e.g. --
What are the costs for fielding another heavy BCT?
Functional, e.g. --
What are the full costs for ‘Growing The Army’?
Planning, Programming and Budget Formulation
Current management practices
Functional, non-financial processes
Funds control
Financial business operations
Cost Management
Examples of questions for various types of analysis:
Comparative
What are we spending for same or like functions at different locations?
Are there significant differences? What are the cost-drivers?
What are the “best practices” relating to best costs?
Trend
What have we spent for something annually?
What did we get for what we spent annually?
What were the trends over the past years?
Predictive
What will future output cost based on cost of same/similar prior output?
What are cost of various options for accomplishing the objective?
Functional– enable consideration and integration of resource as well as other functional data
Analysis of GFEBS data can be applied to improve
various types of decisions (as illustrated here)
across the Army and
up/down the chain of command
Most decision practices:
Planning, Programming, and Budget Formulation
- Current management practices: How are our funds holding out on the engineer project?
- Functional, non-financial and processes: What are the maintenance requirements for building ‘x’?
- Funds control: How many of these PRs can we afford?
- Financial business operations: Are our financial accounts accurate and auditable?
GFEBS provide data and analytic tools
Army needs to grow skilled analysts
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9. Army Purpose Cost Management
Managing Business Operations Efficiently & Effectively Through the Accurate Measurement & Thorough Understanding of the "Full Cost" of an Organization's Business Processes, Products & Services in Order to Provide the Best Value to Customers.
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10. Need to Understand What the Resources Buy – The Army Product
Resources (Labor, Equipment, Assets)
Organizations (Cost Centers)
Products/Services X
Light
Stryker
Heavy
Effectively & Efficiently Produce Outputs
Ensure Strategic Objectives are Effectively Resourced
ARFORGEN
Human Capital
Materiel
Readiness
Services & Infrastructure CG
TRADOC
AMC
FORSCOM
IMCOM
Cost Management Construct
Program / Budget Construct
ARFORGEN Synch Board
This slide illustrates the capability to allocate various costs to a brigade and --
Present a more realistic summary of total cost to add or sustain a brigade.
Provides opportunity to better recognize the various cost drivers.
The cost data headings relate to various organizations as follows:
Training, Individual: essentially TRADOC
Training, Unit: essentially FORSCOM, USAREUR, EUSA, USARNG and USAR
Base Support: essentially IMCOM
Equipment: essentially AMC
Personnel:
Military- essentially centrally controlled but GFEBS enables aligning to force
Civilian- funds dispersed among a number of appropriations, but GFEBS enables aligning to manpower costs to force
NOTE: May insert slide(s) with comparisons, e.g., (illustrative only)
1st Heavy Bde at Ft Hood costs $1.35 bil/year and is C-1
Avg Heavy Bde in III Corps cost costs $1.5 bil/yr and is C-1
What is 1st Bde doing to achieve readiness at lesser cost?
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11. Cost Measurement Must Reflect
Management Processes
Resource Managers
Operational Managers
Inputs
Conversion
“Work”
Outputs
Resources:
Labor
Material
Equipment
Supplies
Contracts
Assets
Products Services:
Courses
Services Support Programs
Tests
Research Projects
Training Events
Work Performed by Organizations (Cost Centers) to Produce Products and Services for Customers 11
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12. What Does the Army Manage? “GFEBS Cost Model Needs to Support….”
Full Cost
Organizations
Full Cost
Product/Services
Full Cost
Customers
Services:
Food Services,
Transportation,
CIF, etc.
IMCOM:
Garrison
- Tenants
A monetary valuation of the economic goods and services of the organization – full burden cost flows
Courses:
Mission technique
classes, combative
training
TRADOC:
Ranger School
- Division / BCT
- MOS
- FMS
Units:
Optempo,
Mobilization,
Events, Etc.
FORSCOM:
3rd Army - 1st BCT
- Mission
Commander
maturation over years
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13. Cost Management Requires Changing the Culture
Develop/Recruit Analysts
Enhance Training
Performance Focus
“A Culture of Influence”
“A Culture of Entitlement”
Cost and performance focused
Results driven - output & outcome
Performance objective – resource consumption optimization (efficiency & effectiveness)
Use what is necessary to obtain the objective
Enabler #3
Budget-focused
Spend rate driven – inputs
Performance objective -99.9% obligated
Free goods has infinite demands
Process Improvement
Integrated Business Designs
Policy
How
To’s
Enabler #2
ERP Applications e.g. (GFEBS, LMP, GCSS)
Business Warehouses
Executive Scorecards
Enabler #1
Enablers of Change
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14. GFEBS Technology Enables Cost Management Change
Army Cost Framework
Integrates Financial and Non-Financial Systems and Processes
GFEBS will provide
Multiple Cost Views for Decision Making at Every Level
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15. Changing Policy and Preparing Personnel in Conjunction with GFEBS
Policy & Guidance
Training (Operational & Resource Mgrs)
Cost Management 101
- Cost Management Overview
Cost Object (ERP) Definitions
Cost Flow Methods
Cost Analysis and Reporting
GFEBS – Cost Management Training
These courses are either computer-based or instructor-led training classes to learn how to operate within the GFEBS cost module.
Cost Management Certificate Course
The program of instruction (POI) is designed to teach the fundamentals of cost management with a view to developing a cadre of Army personnel who are professionally knowledgeable, analytically competent, and personally motivated to serve as proactive change agents within their respective Enterprise line and staff organizations.
Self Study-Cost Management Community of Practice
Cost Management Courses in all Professional Development Programs
Tools
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16. Will Take Time to Mature Into Cost Management
“What It Should Cost”
Outcomes
STANFINS/SOMARDS
Budget Allocations
Obligations
Execution reporting
Financial Accounting
Limited Analysis
Managerial/Cost Accounting
Cost Allocations
Cost Centers
Cost Drivers
Cost and Performance
Cost Planning
Cost Control
Feedback and corrective action
Goals, results and predictive tools
Cost Measurement
“What It Actually Cost”
Inputs & Outputs
“What did we spend?” Input
Growing to a cost culture doesn’t happen in one attempt. Rather it’s a process transitioning budget control as the primary focus to a focus of management information and decision making.
This is a big shift but it is and has been a core desire of Army to get to a cost management perspective. One limitation on achieving this target of culture change is that of the financial system STANFINS and SOMARDS were budget centric with little to offer in terms of cost management. Even with the system constraints the Army’s desire for cost information was still fighting toward the cost culture and the current APC code set is the result.
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17. Begin by Implementing Cost Accounting (Measurement) in GFEBS
Expense Elements
Organizations
Products & Services
DCPS
ATAAPS
WMT
DIMHRS
Payroll
Business
Process
Cost Center
Material
WAWF
FCM
PCard
Orders
(Internal, Work)
Supplies
Activity Types
Labor Pools
Equipment usage
Facility usage
LMP
GCSS-A
Project WBS
Element
Equipment
Depreciation
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18. Capturing Cost by Organization, Product/Service and Customer
Cost of Installation Services Provided to Tenants
BCT Cost by Resources Consumed
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19. Integrating Cost Measurement
and Analytics
- Variance Analysis
Controlling
- Cost Planning
- Cost Comparison
Benchmarking
- Forecasting
- Trend Analysis
Cash Flow
Operational
Cost Mgmt
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20. GFEBS Is Transforming the Army Today and Tomorrow
New system with analytic tools and capabilities
New business processes
Capitalizes on “best practices” embedded in ERP
New management structures and data concepts
New roles, skills and knowledge for end users
Opportunity for individuals to develop skills with state-of-the-art ERP system and cost management techniques
GFEBS will transform financial management and
management practices in most functions
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As of 25 August 2009 20 20