Looking at Small Business Lessons for Big Changes at the PentagonJune 11, 2010
Frank Kendall, the new principal deputy undersecretary of defense, has set his sight on slashing runaway waste in the Defense Department's $375 billion-per-year contracting system. But as a GovernmentExecutive.com article notes, his predecessors have tried and failed at this difficult mission. Kendall, however, said that he would try a new approach. He plans to start from the ground-up and find the fundamental causes of the waste and inefficiency. According to the article, Kendall plans go beyond the typical process-oriented review to eliminate system redundancy and streams of paperwork, and instead will conduct a more thorough examination of the incentives that lead to cost inefficiencies. Still, reforming the Pentagon's acquisition process obviously is not easy. The department is constantly pulled in different directions by various interest groups, the article notes. Chief among those groups are lawmakers, who push to keep pet defense projects from the chopping block—afraid they'll lose the jobs in their districts. The Pentagon is the largest single buyer of goods and services in the world. "There is a certain amount of institutional inertia that needs to be overcome," Kendall said. The problem might be that each time a reformer seeks to make fundamental changes in the Pentagon's acquisition process, the entire department is challenged at one time. Robert J. Chalfin, a lecturer at Wharton, noted that there are lessons from managing change at small companies that could apply to much larger enterprises. Small companies that want to find waste and inefficiencies look at their process engineering. They ask questions that seek the root cause of the waste: "What are they doing that is not necessary anymore? How can they automate certain processes? Could they outsource certain functions?" |
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