At this week’s MIT CDOIQ Symposium, held in Cambridge, Massachusetts, you wouldn’t have been faulted for recognizing that two industries that have embraced the Big Data revolution are healthcare and the financial sector. The benefits of employing analytics models to these fields are more and more apparent. You might be surprised, however, to learn of one particular public sector player that is seeking an operational advantage via Big Data: the Department of Defense.
Mort Anvari, Director of Programs and Strategy within the Deputy Assistant Secretary of the Army’s Cost and Economics division, has overseen the creation and implementation of directives aimed at the cost culture and cost management of the US Army.
“Private industry is easier because everyone is cost conscious,” Anvari explains. “In government, particularly during a war, that mission is driving everything. Most of our officers are only concerned with how much money they need and how they spend it.” Anvari admits that his task of directing commanders to accede to a cost culture mindset was a pretty big deal. “We had to look at it from the people’s perspective. That includes convincing leadership that attention to cost doesn’t create a bad image for the country.” The main argument centered on the perception that being cost conscious could appear to be putting our servicemembers unnecessarily into greater harm’s way.
Watch the interview in its entirety here:
Anvari claims an early success with the education of commanders and other officers that paying special attention to cost and soldier safety were not mutually exclusive. “You can be cost conscious. You can do more with your resources. You can be more efficient with it and still care about safety and care about the soldiers.”
With projects budgeted above $10 million, an automatic cost/benefit analysis is enacted. Anvari oversees more than 2,000 Army analysts who perform and validate each of these. Knowing the process, commanders will typically consider an additional course of action to what they submit for review. “Talking to commanders and leadership, we ask ‘What is your information need?’,” he stated. “Based on that, we develop a data need for that organization.”
Similar to challenges faced in the private sector, one of the issues overcome by the Army was convincing certain organizations that possessed data to share that property with other organizations. “Communicating the data need from organization A to organization B, telling organization B you need to provide this data that is not for you, it’s for someone else,” Anvari said, “that was a big culture shock.”
However, in explaining the funding structure for the military like an upside down tree, Anvari was able to bring an understanding that all funding came from the top and spread out to all of the “branches” within the Army. “We call it fund centers. They have all the money. The cost centers are the ones using this money. It could be them or it could be others. It’s truly like a neural network of information.”
Unlike private sector companies, the Army realized they had to streamline their budgeting and allocation process due to the fact they are subjected to strict oversight by the Congress. As all of the funding is taxpayer monies, citizens are also privy to the budgeting process through the use of Freedom of Information Act requests.
As noted above, the cost-benefit analysis process is automatic on projects in excess of $10 million. However, Anvari notes that projects under that threshold, undertaken by commanders of smaller outfits, are pretty well self-monitored because those commanders want to show that they are capable of critically applying the new cost culture analysis in the hopes they will be promoted to heading up larger projects in the future.
“Accountability is hard to swallow,” says Anvari, with regard to the early push back from Army leadership, “no matter how normalized the process is.” Anvari’s work is seeing results, however. “Cost management is on its feet and working,” he concluded.
photo credit: The U.S. Army via photopin cc
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