Army leaders devise cost-conscious approach 

12/1/2010 

To adjust to the coming era of budget constraints, the Army is working to convert its commanders and managers from a "budget culture," where they spent whatever funds they were given, to a "cost culture," in which they determine what everything costs and what benefit the Army gains from it, a panel of Army leaders said Oct. 27.

The cost-conscious approach is driven partly by Defense Secretary Robert Gates’ "efficiencies initiative" and by the recognition by Army leaders that they must do a better job of managing the taxpayers’ dollars in pursuit of their mission of defending the nation, the panel on Readiness at Best Value explained during an Institute of Land Warfare Forum at the Association of the United States Army’s Annual Meeting and Exposition.

Lt. Gen. Robert Durbin, special assistant to the Army chief of staff for enterprise management, said they traditionally insulated commanders from worrying about cost so they could focus on mission and soldiers. But now the Army is driving a wide range of programs to improve its understanding of what it spends and ways to get better value for the expenditures.

That approach covers everything from the big ticket procurement programs down to routine transactions and functions, the panel of uniformed and civilian managers said.

Durbin cited examples of progress made since the cost initiative was launched a year ago, including the designation of Army Under Secretary Joseph Westphal as chief management officer (CMO) to lead the effort.

The Army also formed an Office of Business Transformation, for which Durbin is the acting director, to carry out the CMO’s programs to improve business practices.

Gen. Peter Chiarelli, Army vice chief of staff, is conducting a capabilities portfolio review to identify the cost and benefit of current programs and to weed out redundancies, Durbin said.

They also have delivered a business transformation plan to Congress and are working to meet congressional orders to make their financial programs fully auditable by 2017.

The officials emphasized that the goal was not necessary to cut programs, but to gain better value.

The efficiency efforts include aggressive efforts to reduce the Army’s use of increasingly expensive fossil fuels for renewable sources, such as the 500 megawatt solar power plant about to be turned on at Fort Irwin, Calif.