stars cfo act system changes

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Metrics/Measurement and Balanced Scorecard
Department of Defense Financial Management
Automated Balanced Scorecard and Department of
the Navy Major Command Scorecards


Nancy Carpenter ASN(FMC) 3 February 2005
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Metrics/Measurement and Balanced Scorecard -
Background

• Financial Management (FM) metrics program began
  in Aug 01 with four metrics on problem
  disbursements
• At present, the financial management metrics are
  mainly being monitored at a Department level
• Data is provided to OUSD(C) by DFAS and uploaded
  onto their Financial Indicator website
• Since Aug 01, DoD has grown into a Balanced
  Scorecard management approach footprint with over
  25 key indicators covering accounting and
  finance, business management, and budget and
  OUSD(C) is leading DoD into implementation of an
  Automated Balanced Scorecard
• OUSD(C) memo of 26 Feb 04 announced the DoD FM
  Balanced Scorecard that aligns strategy, goals,
  objectives and related performance metrics with
  the risk management framework established in the
  Quadrennial Defense Review and Management
  Initiative Decision 901

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Metrics/Measurement and Balanced Scorecard

• The risk framework is made of four areas
• Force Management Risk
• Operational Risk
• Future Challenges Risk
• Institutional Risk
• Based on this framework, DoD developed their
  scorecard within the same structure
• Force Management Risk (Innovation Learning
  Perspective)
• Operational Risk (Financial Perspective)
• Future Challenges Risk (Internal Business
  Perspective)
• Institutional Risk (Customer Perspective)

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Metrics/Measurement and Balanced Scorecard
Effective financial management impacts all four
risk areas and should be measured and represented
on the scorecard accordingly.
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Metrics/Measurement and Balanced Scorecard
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DFAS FY 05 Balanced Scorecard Linked to DoD
Customer
Institutional Risk
I.1 Provide Timely and Accurate Management
Information I.2 Reengineer the Department's
Business Processes Deliver a Well Designed
Business Management System I.3 Governance of the
Business Management Modernization Program
DoD Strategy (QDR)
- Client/Customer Satisfaction - Open audit and
material weaknesses - Operational Performance
Index - High Risk Area Management
Operational Risk
Financial
O.1 Provide Broad Overview of the Department's
Business and Financial Performance to include
Recent Developments Trends, and Objectives
- PMA Competitive Sourcing - PMA Financial
Management - PMA Budget Performance -
Financial Performance Index
Future Challenges Risk
C.1 Deliver Relevant, Reliable and Timely Budget
to OMB and Congress that Integrates
Performance Measures C.2 Execute the Budget to
Provide the Resources Necessary for the
Capabilities Needed by the Combatant
Commander
Internal
DoD Financial Management Scorecard
DFAS Balanced Scorecard Metrics

• PMA eGovernment
• - Manage and Deliver System Changes
• - Deliver Business Intelligence Model
• - Close Benchmark and Service gaps
• - PMA Improper Payments
• - Lean6 Blackbelt Projects

Force Management Risk
F.1 Transform the Financial Management Workforce
to a more Analytical Staff F.2 Align
Performance Plans and Appraisals with
Organizational Goals F.3 Establish a Program
Office to Champion FM Workforce
Development Issues with DoD Components F.4
Recruit and Retain Skilled Financial Managers to
Replace Aging and Retiring Workforce F.5
Ensure Technical Competencies are Adequate
Growth Learning
- of Civilian Employees with
Licenses/Certificates - of Civilian Employees
with Degrees - PMA Human Capital - Employee
Satisfaction OAS Index
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Link BSC to Agencys Vision and Goals
MEASURES
OBJECTIVES
GOALS
Client/Customer Satisfaction

• Fully satisfy customer requirements and
  aggressively resolve problems to deliver best
  value services
• Use performance metrics to drive best business
  practices and achieve high quality results
• Optimize the mix of our military, civilian, and
  contractor workforce

VISION Best Value to our customers
CUSTOMER
Open Audit Recommendations

• Improve Client/ Customer Satisfaction
• Satisfy Key Stakeholder Requirements

Operational Performance Index High Risk Management

• World-class provider of finance and accounting
  services

PMA Competitive Sourcing
FINANCIAL
PMA Financial Management

• Manage DFAS Costs

PMA Budget Performance
Financial Performance Index

• Trusted, innovative financial partner

• Establish consultative relationships with leaders
• Deliver business intelligence to enable better
  decisions

INTERNAL
PMA eGovernment

• Deliver Effective System Solutions
• Deliver Competitive Services
• Develop a Quality Focused Culture

Manage and Deliver System Chg
BI Delivery Model

• One Organization, One Identity

Close Benchmark Costs

• Ensure everyone is working towards the same
  vision and can connect what theyre doing to make
  the vision a reality

PMA Improper Payments
Lean6

• Employer of choice, providing a progressive and
  professional work environment

GROWTH LEARNING

• Enhance Employee Competence
• Strategically Manage Human Capital
• Increase Employee Satisfaction

of Employees with certifications

• Embrace continuous learning for our workforce to
  ensure critical, high quality skill sets
• Develop the next generation of DFAS leadership

of Civilian Employees w/ degrees
PMA Human Capital Employee Satisfaction OAS
Index
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Cause and Effect Relationship of Objectives
Best Value
Customer
Improve Client/Customer satisfaction

• Improve

• satisfaction

• customer

Financial
Implement Transformation Strategy
Reduce cost to

• Reduce cost to

the client/ customer

• the customer

Internal
Improve and
Encourage
Deliver system

• Encourage

• Improve and

• Deliver systems

leverage quality

• innovation

• leverage quality

• solutions

innovation
solutions
Growth
Enhance ability to recruit and retain DFAS talent
Increase

• Increase

• Enhance corporate

Develop a climate

• Develop a climate

employee

• employee

• capability and

Learning

• for action

for action

• satisfaction

• intellectual capital

satisfaction
Enhance

• Increase

• employee

employee

• competence

competence
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Metrics/Measurement and Balanced Scorecard

• In November 2004, OUSD(C) formed a Working Group
  consisting of all the services and many DoD
  agencies to begin the development of the
  Financial Management Automated Balanced Scorecard
  (FABS)
• Automating the scorecard will provide
• A web-based tool to facilitate feedback,
  communication, and management decision-making
• Capability to integrate with accounting system
  data and receive multiple source data formats
• More timely, accurate, and consistent data
• More time to do better analysis
• Enhanced acceptance of the program
• More sophisticated, more timely and accurate
  reporting

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Metrics/Measurement and Balanced Scorecard

• FABS Implementation Schedule
• Implemented in Three of More Phases
• Phase I Pilot/Test (DFAS, BMSI, PME)
• (NLT June 2005)
• Phase II Developed to all DoD Reporting
  Entities
• (NLT September 2005)
• Phase IIIa Possible System Integration (TBD)
• Phase IIIb Additional Modules Added (TBD)

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Metrics/Measurement and Balanced Scorecard

• Why do you care about the DoD FM Automated
  Balanced Scorecard and DoD Financial Management
  Metrics?
• Using the established DoD Financial Indicators as
  a baseline, FMO is reviewing those metrics that
  data can be captured down to the Major Command
  level
• While the framework of the ABS is developing, FMO
  Team Leads with cognizance over that metric, will
  begin using/developing key metrics to be used as
  Report Cards or Scorecards by Major Command
• These Scorecards will enable us to identify those
  specific areas and Major Commands where
  concentration may be needed to accomplish the
  efforts of the Financial Improvement Plan or
  DoD/DON wide efforts

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Metrics/Measurement and Balanced Scorecard

• Financial Indicator metrics identified as
  potential Scorecards
• Interest Penalties Paid
• Accounts Receivable
• Problem Disbursements (UMD/NULO)
• Travel Card Delinquencies
• Purchase Card Delinquencies
• In addition to the main DoD Financial Indicator
  metrics, each Team will be developing other
  internal DON metrics to assist us in tracking our
  progress towards a Clean Audit Opinion and
  Department wide process improvements
• To become more familiar with the DoD Comptroller
  Financial Indicators Program and the level of
  metrics presently being produced, visit their
  website at https//dod-metrics.dfas.mil. Access
  to this site requires a Common Access Card or
  soft certificate.

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Metrics/Measurement and Balanced Scorecard
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Metrics/Measurement and Balanced Scorecard

• ASN(FMC) Metric Points of Contact
• Nancy Carpenter
• Nancy.carpenter_at_navy.mil
• [phone], DSN 325
• Warren Pfeiffer
• Warren.pfeiffer_at_navy.mil
• [phone], DSN 325