The Future of Navy ERP

In January 2003, a decision was made by Assistant Secretary of the Navy for Research, Development and Acquisition (ASN (RD&A)) John Young to realign functional management of the four pilots under one Program Management Office (PMO) and to “converge” the four production systems into one Navy Enterprise Resource Planning (ERP) Program. While the four pilots each executed business process transformations within the scope of their projects, the converged program seeks to transform Navy-wide business practices through Business Process Re-engineering (BPR) utilizing industry common best practices. The integration of the functionality from the four production systems will bring together the capabilities necessary for end-to-end product life-cycle management within the Navy environment. The business practices embedded within the Commercial Off-the-Shelf (COTS) ERP solution chosen by the Navy allow the enterprise to operate within an integrated, process oriented, information driven, real-time environment.

The mission of the Navy ERP Convergence Program – the rollup of four SAP® R/3® solutions into one – is to reinvent and standardize Navy business processes for acquisition, financial, maintenance and supply chain management operations. Integration of these systems will provide accountability of the different organizational units within the Navy and quality information for decision making to all levels of management.

During the Program’s Interoperability Phase, the Navy ERP Team is completing all necessary documentation and program planning to prepare for a Milestone decision in July 2004 by the Office of the Secretary of Defense (OSD), whose approval is necessary for the Program to begin system development and demonstration. In parallel with Milestone preparation, the Program is also working with each of the pilots to baseline the business processes incorporated in each of their ERP solutions – comparing the four to identify where they are the same, where they are different, where there are gaps, and where there are opportunities for further process improvements.

Following completion of this process baseline in July 2003, the team began developing the blueprint for Global Template Version 1 – the first Navy ERP Convergence product. Plans are to configure and test this solution after Milestone A/B for deployment beginning in Fiscal Year 2006.

The Converged Navy ERP Program is going to require strong Navy leadership involvement to achieve the Secretary of the Navy’s goal of creating an enterprise framework to manage our supply chain and to enhance and modernize our business management process. To that end, in an effort that was just kicked off in February 2004, five Process Councils have been formed to drive the process changes required to standardize operations Navy-wide and allow the Navy to reap the most benefit from its ERP solution.

Global Template 1 will deploy the functionality currently in the pilots with a few additions such as an interface to Wide Area Workflow, an interface to the Defense Travel System (the pilots interfaced with Travel Manager), and completion of Wholesale Supply. The following table shows the tentative scope of Navy ERP Global Template 1 according to the program’s Operational Requirements Document (ORD):

Template 1 (Converged Ashore)

• Finance • Program Management • Workforce Management • Wide Area Work Flow (Interface) • Defense Travel System (Interface) • I-Level Maintenance • Plant Supply • Wholesale Supply / Advanced Planning System (APS)

The Navy ERP initiative has the potential to be a long-range program with a long-range goal. It is not a “project” with a beginning and ending – it is a business transformation that will become the Navy “way of life” for the future. In support of the Secretary of the Navy’s Sea Enterprise section of Naval Power 21 and DON Objectives for 2004, the Navy ERP Program is the Navy’s single endeavor to unify its business processes and automated information systems to lower overall maintenance costs, improve management decision making, move more maintenance work ashore, improve resource management, and enhance combat readiness.