The Pentagon is not likely to meet a 2007 self-imposed deadline
to overhaul its financial information systems. Congress reprimanded
the Defense Department two years ago for failing to provide a “clean
audit” of how it spends its annual appropriations of nearly
$500 billion. The Pentagon subsequently created a “business
management modernization program” that would consolidate hundreds
of outdated, incompatible financial systems into a modern “enterprise”
database that could track every business transaction in the Defense
Department. The project, however, has struggled and has fallen short
of expectations, says Paul Brinkley, the Pentagon’s special
assistant for business transformation.
“The reason we can’t get a clean financial audit is
that we have so many business systems,” he tells a group of
defense industry executives. “Since the 1960’s, the
Defense Department has tried to change business systems nine times.
It’s been futile. Giants of industry have come in to tackle
this problem and failed.” When Defense Secretary Donald Rumsfeld
recently asked for a quarterly report of all Pentagon financial
transactions, it took 50 people three days to deliver it. “That’s
embarrassing,” laments Brinkley.