Smart Cuts
advertisement
Meeting Today’s Professional Military Comptroller Challenge: Making Smart Cuts Dave Price Brig Gen (Ret), USAF 8 May 2012 Booz Allen Hamilton Proprietary America Society of Military Comptrollers 1 Book Review … Who’s at the pointy end of the spear today … Booz Allen Hamilton Proprietary America Society of Military Comptrollers 2 Book Review … Who’s at the pointy end of the spear today … Booz Allen Hamilton Proprietary America Society of Military Comptrollers 3 DOD Funding Trend … $ Billions Baseline Defense Overseas Contingency Operations 700 600 $115B Estimated DoD funding level if sequestration continues thru FYDP $83B 500 $514B $472B 400 300 $518B (-5.6%) $524B (1.1%) $533B (1.8%) FY12 Enacted FY13 FY14 $546B (2.3%) $556B (1.9%) $567B (2.2%) FY15 FY16 FY17 200 100 0 Source(s): OMB, Budget Control Act of 2011, The Heritage Foundation Booz Allen Hamilton Proprietary America Society of Military Comptrollers 4 FY13 Way Ahead … FY13 budget enactment … CRA? National election on 6 Nov Lame-duck Congress Sequestration required on 2 Jan Mid-year budget cut of ~$52B for DOD Rules of engagement are unknown Professional comptrollers will be left to figure it out … Booz Allen Hamilton Proprietary America Society of Military Comptrollers 5 Process Challenges … There are systemic barriers to budget decision making – Budget timeline often works against thoughtful decision making – Ad hoc process for prioritizing requirements – Weak enterprise governance process – Missing right tools to frame the alternatives – Programmatic dependencies are not well understood – No mechanism for surgically decrementing programs – Wrong incentives in place for effective decision making – Resistance to change Many initiatives require investments to achieve savings Focus on quick wins can distract from the long-term goals Booz Allen Hamilton Proprietary America Society of Military Comptrollers 6 Budget Toolkit … Who’s at the pointy end of the spear today … Cutting the Budget – Peanut butter spread Booz Allen Hamilton Proprietary America Society of Military Comptrollers 7 Budget Toolkit … Who’s at the pointy end of the spear today … Cutting the Budget – Peanut butter spread – Focus on administrative costs Booz Allen Hamilton Proprietary America Society of Military Comptrollers 8 Budget Toolkit … Who’s at the pointy end of the spear today … Cutting the Budget – Peanut butter spread – Focus on administrative costs – Reduce manpower Booz Allen Hamilton Proprietary America Society of Military Comptrollers 9 Budget Toolkit … Who’s at the pointy end of the spear today … Cutting the Budget – Peanut butter spread – Focus on administrative costs – Reduce manpower – Outsource tasks Booz Allen Hamilton Proprietary America Society of Military Comptrollers 10 Budget Toolkit … Who’s at the pointy end of the spear today … Cutting the Budget – Peanut butter spread – Focus on administrative costs – Reduce manpower – Outsource tasks – Invest in information technology Booz Allen Hamilton Proprietary America Society of Military Comptrollers 11 Budget Toolkit … Who’s at the pointy end of the spear today … Cutting the Budget – Peanut butter spread – Focus on administrative costs – Reduce manpower – Outsource tasks – Invest in information technology – Consolidate and centralize activities Booz Allen Hamilton Proprietary America Society of Military Comptrollers 12 Budget Toolkit … Who’s at the pointy end of the spear today … Cutting the Budget – Peanut butter spread – Focus on administrative costs – Reduce manpower – Outsource tasks – Invest in information technology – Consolidate and centralize activities – Process re-engineering Booz Allen Hamilton Proprietary America Society of Military Comptrollers 13 Budget Toolkit … Who’s at the pointy end of the spear today … Cutting the Budget – Peanut butter spread – Focus on administrative costs – Reduce manpower – Outsource tasks – Invest in information technology – Consolidate and centralize activities – Process re-engineering – Programmatic cuts Booz Allen Hamilton Proprietary America Society of Military Comptrollers 14 Making Smart Cuts … Carefully assess the budget environment Prepare for budget cuts now by updating strategic plans and make leadership priorities clear to everyone Measurable goals provide mechanism for budget accountability Establish a transparent decision making process Leaders need to consider alternative ways of performing functions Understand the links and dependencies between programs Substantial across-the-board cuts can be severe and penalize the most efficient operations Allow field to determine the best way to meet reduction targets based on strategic plans, performance measures, and leadership priorities Booz Allen Hamilton Proprietary America Society of Military Comptrollers 15 Bottom Line … Comptrollers have a new high profile role … Understand how to use the budget toolkit … Know the real-world constraints … Think and plan ahead … Be flexible … Remember you are doing important work for our Nation … Contact me at: price_david2@bah.com Booz Allen Hamilton Proprietary America Society of Military Comptrollers 16 Questions … AIM-120D being loaded on F-22 in preparation for vibration test at Eglin Air Force Base Contact me at: price_david2@bah.com Booz Allen Hamilton Proprietary America Society of Military Comptrollers 17
