DR. IYER: Good afternoon everyone. This is Raj. On behalf of General Morrison thanks for taking the time to meet with us this afternoon. It is really truly important, the role that each of you play in getting the message out, not only to industry but to Soldiers worldwide in terms of the efforts that are underway and getting our plans out there as well. So where I wanted to spend today was really focus the conversation on the President's budget request for 23 and as you all are probably tracking this is budget season on the Hill and the Army has submitted its budget. And what I want to do today was to walk you through the IT and cyber elements of the 23 budget, and along the way talk to you about some of the initiatives that are underway, our priorities and some of the pivots and realignment, rebalancing that we're doing in the budget to get to the Army of 2030.
So that is the highlight of my opening. And then I will basically turn it over to you for more questions. So, just to take it a step back and set the stage. As you all know, the Army is at an inflection point after 20 years of counterinsurgency fighting in Afghanistan and Iraq. We're now posturing ourselves for a multi-domain fight for a pacing threat such as China and future, and that means that our technologies, our networks, how we get to data centricity, how we address cybersecurity, all of these things need to be readdressed from that future threat perspective. And so FY 23 for us is that year of inflection when it comes to our digital transformation journey, and we need to make sure that the Investments that we have are appropriately aligned to the Army's priorities and to the DoD’s priorities quite honestly through the release of the national defense strategy.
So, overall, where we landed bottom line up front is we've submitted an FY 23 IT and cyber budget that's a total of 16.6 billion dollars. Some of you know that this is the highest of all the services in the DoD but that's because the Army provides 60% of the support to the combatant commands worldwide. So that's a pretty significant support worldwide in support to the Warfighter. The IT budget is about slightly less than 10% of the Army's total budget submitted of about 180 billion dollars. And some of the components of our 16.6-billion-dollar budget is really split into two parts. One is what we call traditional IT and the network, and the second piece is the cyber. And the cyber piece of it is slightly over 2 billion dollars, and this is devoted to all things in cyberspace that's offensive and defensive operations, operating our network including some of the research and development in cybersecurity.
There are clearly some priorities that we have invested in. All of you know that digital means that we have to adopt at scale - cloud, data and AI - so long for those three pieces of those three initiatives we've invested about 220 million dollars in 23 in all things AI. And this is to really get to addressing the Secretary’s objective that she laid out. The Secretary laid out six objectives to the workforce. And the second one is about getting to data centricity. So we are confident with this investment that we have enough resources to be able to make some good progress in 23 to get to data centricity. The bulk of the investment really is what we call the network. It’s about 9.8 billion dollars. And this is clearly supporting all the way from the tactical edge, including support to current operations, all the way to investments we’re making for the cloud. And General Morrison has spoken about the unified network at a number of events, and we will continue to take questions from you on today's call about our plans for the unified network.
But in 23, really it is also our opportunity to scale our Cloud efforts that we have made some tremendous progress in 21 and 22. And so we're seeing about a 290-million-dollar investment in cloud in FY 23 to continue to further our Cloud migration journey. There is some tremendous activity across the Army right now in terms of operationalizing the cloud that we've established called cArmy. This is all the way from experimentation being done by the 18th Airborne Corps, the I Corps, and the MDTFs. But also, we're able to flex some of our emerging Cloud capabilities and support our current operations in Europe. And we have a pretty good feedback loop to ensure that those Lessons Learned are being implemented into the solutions we’re implementing
In terms of AI, as I said, we have a number of efforts underway all the way supporting institutional processes - things like robotic process automation to embedding AI into mission threads, like sensor to shooter. And as, as you all have heard we are making some good progress there with Project Convergence leading those efforts, to continue to mature our AI solutions and technologies.
On the Cyber side, clearly our focus is getting to that zero trust mandate that was established by the White House and OMB down to DoD and down to us. And, as I said, it is in a heightened cybersecurity environment it is really important that we make sure that we have the right resources to protect our networks, our weapon system platforms and our critical infrastructure. And so essentially we're looking at a flatlined budget in 23 between 22, our 22 enacted budget and the 23 request in cyberspace.
In terms of our business systems, overall, we're investing about 1.4 billion dollars in business systems across the Army in 23. Our marquee effort in 23 though is going to be our implementation or initial prototyping for our new Enterprise Business Systems Convergence. And this is the modernization of our business systems across the Army to essentially modernize 20-year-old Legacy ERP systems that we have operated well for the last 20 years. But we know that in order to support contested logistics in future, we're going to be able to, we need the best technology and the best business systems to be able to provide us both financial management and logistics support to the field. So in 23 we will award an OTA to initiate prototypes for Enterprise Business Systems Convergence and that investment Is captured in our budget as well.
In terms of operating and maintaining the Army is what we call our OMA budget, we're essentially slightly lower than what was enacted in 22. And the reason for this is over the last 12 to 18 months, we've actually done a tremendous job achieving efficiencies through some of the modernization efforts, many of them you have heard. Army 365 has led to a massive transformation not just from a user experience perspective but also in our ability to sunset a lot of legacy technology and solutions. So across the board, we're finding that we can be a lot more efficient through consolidation and divestment of legacy technologies.
In terms of procurement activities, most of our procurement activities are really in the tactical space around procurement of radios, Manpack and other tactical radios. It also includes by the way, some dollars for modernization of our networks through the I3MP program. And we're essentially flatlining that into FY 23.
On the research and development side, it is important that we continue to invest in future technologies. So the areas that we are investing, primarily around Quantum computing and super computing requirements, we will continue to build out IPPS-A, our human Capital management system, and the release 4 of that will be funded in FY 23, as well as, as I mentioned, modernizing our network through the unified network plan and then bringing on additional capabilities in AI and machine learning.
So, overall, the budget is almost flat going from 22 to 23 with some decreases like I said, in areas where we've been able to take some prudent risk. And we have a, we believe that this is executable given the fiscally constrained future that the Army and the rest of the DoD will be moving into in 23 and beyond. These pivots that were making now will position us to better handle any unknowns in the fiscal environment in 24 and beyond.
So, I know I said a lot there and again, we're more than happy to share any additional information on some of these numbers, as you see fit. But wanted to also show you, tell you what our priorities were. And with that General Morrison, sir, over to you.
LTG MORRISON: Sir, thank you, and the entire folks out there, thank you very much for taking the time to have a discussion with us. I'm not going to say a whole lot. I'm just going to amplify a couple things that Dr. Iyer sort of said because I think he did a tremendous job laying out the budgetary aspects of it.
What you will see the Army continue to do in FY 23 is continued and even accelerate the shift towards this notion of a unified network. Many of you have heard us talk about it before but really what we are doing is we are aligning our modernization efforts at the tactical edge. It's being led by the network cross-functional team and PEO C3T, the capability set construct with what we're doing at the Enterprise level that supports our strategic and operational headquarters. That alignment will continue through FY 23 and then really accelerate the year after that. It is forming that bridge that quite frankly we're already starting see the operational benefits today in either ongoing exercises or even operations. That strong linkage that allows us to put into play strategic, operational, and tactical affects, at the time of choosing of the maneuver commander’s battle rhythm. So that will continue, a heavy focus at the Enterprise level on expanding our mission network capabilities, think our U.S. classified and mission partner environment or coalition capabilities, and in making sure that that's integrated with what we're doing at the tactical edge again so we have a seamless, integrated unified network in support of multi-domain operations.
From a cybersecurity perspective, you heard Dr. Iyer talk about zero trust. We will continue our shift away from traditional cybersecurity - very, very bureaucratic in nature. Really the security operations in that active defense and security of the unified network in support of ongoing operations and just quite frankly, as you all know, the threat is there each and every day, day-to-day operations.
You will continue to see the, excuse that play on words…you will continue to see the growth of our cyber branch as we proliferate cyber electromagnetic activity capabilities, think cyber and electronic warfare integrated together throughout all of our tactical formations. That growth will continue and even accelerate in FY 23. It will be focused principally on providing capabilities to our brigade combat teams and then reorganizing staff planning cells all the way up to our Army service component command levels. You will also see us really work past just this notion of making sure that the unified network provides the connectivity, but we will be implementing a construct that allows us to build off of the Enterprise capabilities that Dr. Iyer mentioned and then actually inserting those into our tactical formations so we can start leveraging the power of a hybrid Cloud environment with an underpinning of a data fabric underneath of it to enable rapid decision-making throughout the course of FY 23. We've also built upon what we're doing with Project Convergence and we're leveraging ongoing exercises so that we can get some more reps and sets with emerging and promising capabilities that we see, put them in the hands of Soldiers and then have them inform our requirements and quite frankly inform everything that our Army is doing across the entire DOTMLPF spectrum because it's not just about technical capabilities, it's about operations and the Doctrine, Organization, Materiel, Training and Leader Development that we need to be a multi-domain capable force in the future.
Sir, thank you very much and I will pause here. I look forward to any questions or comments you may have.
DR. IYER: Yeah. Just one other point I wanted to make as well was that, as you all know, last year we released the Army digital transformation strategy. Since then we have three implementation plans that we've developed - one for the unified network that General Morrison just talked about. There's also one on the data and then there's a third on cloud. And so with these three implementation plans we have a good path forward, initiatives established, milestones and we're keeping ourselves in check to make sure that we're delivering on each of these initiatives.
Also in 23 was the first year we were actually able to look at resources and start to align it to the priorities in the digital transformation strategy. And so this is still going to be a work in progress and so when we get to 24 you'll see us mature much further into that. But this year was the first year we were actually able to look at dollars against the strategy in each of those implementation plans.
With that, Bruce, back to you and I guess you can facilitate some questions.
PAO: All right, for our first question we're going to go to Colin Demarest, from C4ISRNET and Army Times.
COLIN DEMAREST: Hey guys. I was just hoping someone could elaborate a little on that growth of electronic in cyber in 2023 and why that is important timing wise or maybe even current events wise. Thank you.
LTG MORRISON: Yeah, may I answer? (Yeah) So as you know, Colin, several years ago the Army made a significant investment in reorganizing our existing electronic warfare force, integrating them into the cyber branch and then a decision to grow capability because quite frankly, over the course of the 20 years of conflict, fighting counterinsurgency, we had divested of a significant amount of our electronic warfare capabilities, everything from sensing the environment to electronic protection and certainly on the electronic attack component of it. All you have to do is read the open-source news and you can see that it is a critical component of what is happening over in Europe right now. So having that ability to be able to defend ourselves inside the electromagnetic spectrum, but also to have the ability to see it, that sensing component, and we are an Army, having that ability to leverage electronic attack capabilities to include RF-enabled cyber we believe is going to be absolutely critical in a future fight. It is a key component of multi-domain operations. A lot of folks think of Army Cyber (Command) as cyber in the Army - Army Cyber (Command) is a huge component of it and they do the vast majority of their work for U.S. Cyber Command. Cyber in the Army is a much broader context. It brings together those joint capabilities with tactical, I will call it, cyber capabilities that are going to be embedded in our multi-domain task force, as well as our corps, division, and brigade combat teams. So it's a pretty extensive investment by the Army. We're on a multi-year growth pattern, but we're in a pretty good spot right now. Over.
PAO: Okay, for our next question, we will go to Jaspreet Gill from Breaking Defense.
JASPREET GILL: Hi, thanks. I think I'm good for now.
PAO: All right. Kate Macri from GovCIO.
KATE MACRI: Hi. This is Kate. I'm just wondering given all of the talk about AI being such a big part of JADC2 at the DoD Digital and AI Symposium this week how your AI Investments are factoring into your contributions to JADC2 in fiscal year 2023.
DR. IYER: Yeah, so I will kick that off and then turn it over to General Morrison for more color. So as I noted, AI is really a journey for us in the Army. And so it starts with, the bottom line is, how do we get to the large, vast volumes of data that we’re collecting through sensors, Soldier being one of those sensors, and to be able to process that at scale for decision-making by a commander in the field. That's really what I like to term decision dominance. First, you get to that decision dominance. Our ability to rely on traditional approaches of that really is very manual to pore over large volumes of data and that might be across all the different war fighting functions intel, logistics, personnel and so on. You really need to make sure that we have this kind of machine learning capability or some automation capability to be able to weed through all of that data and then present options for the commander to execute. And it's even more important in a multi-domain concept because you want the data to be able to offer optionality to the commanders between kinetic and non-kinetic effects. And so these are the concepts that we are trying to validate and prove out through various experimentation efforts both through Project Convergence but also through Scarlet Dragon that the 18th Airborne Corps has initiated, the exercises at INDOPACOM, through US Army Pacific and our I Corps and our 1st MDTF….each one of them are looking at various vignettes trying to figure out how much data is needed at the tactical edge, what kind of processing and algorithms do we need to be able to quickly present options to the commander and what technology in the network is needed to be able to support that.
So, while all that is happening remember that we're also on a path right now to acquire some new weapon system platforms - Mobile Protected Fires, M-SHORAD, IVAS…. all of these new systems that are getting fielded now are getting built with some kind of artificial intelligence capability built into them automatically because again, like I said, they all come with sensors. They all have the ability to fuse data at that edge and to be able to present options to either an individual Soldier that's dismounted or at a command post or a Corps headquarters. And so the ability to be able to process large volumes of data absolutely requires the use of AI and machine learning.
General Morrison, anything you want to add to that?
LTG MORRISON: So ma'am, thanks for the question. So the Army, as a part of FY 23, its funding continued work with Project Convergence - it is inherently joint and quite frankly for Project Convergence 22 it's inherently joint and coalition because for JADC2 to work all the services must be working together. So that really is going to be one of the central components of how we drive this from a joint context. But I want to build a little bit on what Dr. Iyer said with the experimentation, and I would tell you demonstration and implementation in US Army Pacific. By anchoring to the first multi-domain task force, a lot more reps and sets, like almost every quarter conducting an exercise in theater, where we will be able to rehearse concepts and capabilities that we see coming out of the Project Convergence series or something else we just want to try that we want to feed back into Project Convergence. When we're doing that in the INDOPACOM AOR we are working very closely with the combatant command out there because quite frankly, Morrison's opinion, the geographic combatant commanders really also need to be driving on this notion of JADC2 because that will force the joint integration at the theater level. And so it's really a win-win. We have Project Convergence inherently joint and then now we've set up another mechanism that allows us to get the reps and sets. While we're doing it to Army channels, we will be plugged in underneath a geographic combatant command who will put those additional demands on us and really work that theater-level integration. So I think there's really two really good frameworks that we're putting into place. Over.
KATE MACRI: Great, thank you so much.
PAO: Okay, now we'll go to Jason Miller, Federal News Network.
JASON MILLER: Hey, Dr. Iyer and General Morrison, good to talk to you again. Thanks so much for taking the time. One quick clarification because Dr. Iyer broke up, when you're talking about a 220-million-dollar request investment in 2023, you sound like you said AI, but you kind of broke up. But you said maybe but then you talk about getting to data centricity - was that the right….Did I hear that right? AI? Or was that something else?
DR. IYER: Yeah. Jason, it's data and AI together.
JASON MILLER: All right, all right. Okay. Now my real question…. thank you for that…. goes back to talking (audio bad) you said slightly lower, in the last 18-24 months we received a lot of efficiencies, Microsoft 365, massive transformation. Can you talk about what some of those efficiencies were? Did you reduce the number of applications? I know the Army's been on a path to do that. Have you reduced the number of data centers? I know the Army's been on the path to do that. Can you kind of name, where did you find some of those efficiencies and if you have any dollar figures you can share?
DR. IYER: Yeah, not a not a detailed breakdown of each of those, but at a high level, I would say a few things have started to happen. One is the convergence of our networks. As many of you know, as part of our unified network strategy, we're looking at converging our 42 networks across the Army into that single unified network. And so what that will do really then is start to consolidate all of the tools, common service catalog, a common set of processes - and that kind of standardization across the network will inherently result in cost savings into 23 and beyond.
There's some other things that we have done in terms of reducing our builds for 23 based upon our current spend. One of them really is, and some of you have heard this already, is our most recent decision to complete or finish out our Enterprise IT-as-a-Service pilots. And so as many of you know, we had three contracts in place and three pilot locations that we had selected. And most recently, based on the results and the lessons learned, we have come to a conclusion that we have good data in order to be able to deploy some common services that's cloud-enabled across all Army locations worldwide - Army 365 being the first of those. And it came out of Enterprise IT-as-a-Service as one of those things that we could scale and there's additional solutions and capabilities that we're going to scale across the Army. So for 23 our ability to get to things like virtual desktop infrastructure, that standardization so we'll have one image to the cloud delivered to everybody a single network that runs a common set of tools, standardization.....all of that we are confident will lead to efficiencies and cost savings in 23.
General Morrison, anything you want to add to that?
LTG MORRISON: I think you did a really good job. Jason, that's a great question. There are things that we did simply divest, and as everybody knows, it's sometimes hard to get rid of things in the military, but we are making some hard decisions - legacy video teleconferencing capabilities, Army 365 does that more than adequately. We were able to last year, the year of execution, decide that was a capability that we didn't need to provide the Army anymore. So we're seeing some fascinating use cases of the speed at which we’re able to make decisions as Enterprise capabilities come online. We just need to be ruthless in our governance of it to make sure that we divest of legacy capabilities and we don't hang on to something just to hang on to it. But I think we put… I don't think…. I know we are putting the mechanisms in place to really start getting after that.
The only other thing that I would offer to you is we are continuing to shut data centers. We are continuing to leverage the great capabilities that come with cArmy. We're not doing it at the speed and tempo that we probably can. And quite frankly, Dr. Iyer and I had a discussion just earlier this afternoon about reinvigorating those efforts because even though we're past the goals that had been set for the Army from an efficiency but I would submit to you more importantly from an operational effectiveness perspective, we need to move a little bit faster and harmonize what this hybrid cloud operational environment is really going to look like. It will only drive us faster towards data centricity. It will only drive us towards a unified network that can support multi domain operations, and it will only drive us quicker into the envelope of JADC2. I hope that answers your question, sir.
JASON MILLER: Yes, very good.
PAO: Now we'll go to Nikki Henderson from GovCIO.
NIKKI HENDERSON: I don't have anything at this time. Thank you.
PAO: Thanks, Nikki. Matt Beinart, Defense Daily.
MATT BEINART: Great. Thank you. So I wanted to ask about kind of the broader budget piece but Dr. Iyer you mentioned that from 22 to the 23 request that around 16-billion-dollar figure represents essentially a flat budget right there or transition. But getting after the digital transformation strategy and the unified network plan in the coming years, can you execute that, get after that with continued flat budgets? Will you require a plus-up or even a significant plus-up in the coming years to be able to get to that? What's your sense of the needs there? Thank you.
DR. IYER: Yeah, great question, right? So many of you have heard me say this. You know, I truly truly believe that we can get to that modernization of our network zero-sum. And the way we’ve got to do this is going back to the point that General Morrison just made - we’ve got to be ruthless in our prioritization. And we got to be really, really watch our execution tightly and make sure that we have that we are reprioritizing, continuously reprioritizing our budget in support of future modernization. It is very very tempting to continue to spend money on technologies that are 10 years old because we've gotten comfortable with them. We know that they work. They meet today's needs. And it's so much easier to just keep them on because that's risk-averse. And people know what to do with them. And we know how much to budget for them. But, like I said earlier, that's not what is going to help us fight and win through multi-domain and for the Army of 2030. So the process that we're taking internally through the governance mechanism that General Morrison talked about really is for every one of these initiatives underway in our portfolio. We're taking a hard look at okay, what are the requirements that are driving this initiative, this program? Are those requirements still valid, right, for the Army of 2030? If they are not, then that's the first step in the process is to take a hard look and change the requirements to make sure that it's forward-leaning to meet future threats.
And then we're looking at how we're executing the program. Are we executing it to cost, performance and schedule? And there are challenges with that - we have made some hard decisions this year to terminate certain programs on the business system side and we will continue to do that if programs are not delivering on time and on budget. So, that's again, those are hard decisions we’re making.
We're also like I said, we are reassessing existing solutions to make sure that they are future-proof which means that if we're building yesterday's technology, right, and they are not easily upgradeable and cannot be modernized continuously into the future then they become Legacy really, really fast because the pace at which technology is changing means that our investments that we make in certain technologies can get outdated by the time we get them implemented. So we are taking a hard look at those solutions. And one of the things that we're doing really is trying to get to a software-defined world, and whether that's on the network, whether that's how we do things in the cloud, whether that's all the way from transport…it's about making sure that's…. if it's, as long as it's software-driven, then we can continuously push enhancements all the way down to the tactical edge if needed. But if we're going to get locked into proprietary systems that do not enable us to break out the software piece from the hardware, then it gets harder and harder for us to modernize. So, really, the strategy is to rationalize every one of these things that we're looking at, deciding what we keep, what we divest and what we modernize and, and doing that in the zero-sum budget neutral environment.
General Morrison, anything you want to add to that?
LTG MORRISON: I think that's a great question. I could not agree more with what Dr. Iyer just sat there and said. I think by doing this synchronization and integration of our requirements and harmonization, challenging the assumptions of which some of them that are many years old, are they still valid? And then breaking the silos that we had inadvertently put up between tactical and enterprise and even within those environments, different stove pipes we had put in there. This is not just an efficiency drill. This is actually an operational effectiveness drill and that's why I beat on it in my last comment. So I believe with the current budget we've got, we can get more efficient and we can get more effective and quite frankly, it's what our nation and our Army are demanding of us. It is a heavy lift - this review that Dr. Iyer just sort of laid out but we have significant senior leader involvement in it. And we are working diligently to rationalize that. Our aim point right now is for the next budget cycle but at every opportunity we're going to pull that back to the left because we have seen, and Army 365 is a great example of it, near term implementation of, to use Dr. Iyer’s words, future-proof capabilities leads to near term operational effectiveness and fiscal efficiencies.
PAO: Okay, we'll go to Jon Harper, DefenseScoop
JON HARPER: Great, thank you. General Morrison, can you quantify how much the cyber branch will be growing in FY 23?
LTG MORRISON: You know, if you'd asked me that when I was the cyber COE CG I would have given you an exact answer and I can get it to you. It is more than doubling over the course of the next several years. And that is caused by two factors. One is Army approved growth and then two is, as I mentioned, our electronic warfare professionals used to be a functional area operating on their own. They are now a part of the cyber branch and almost all that growth is on our tactical formations. Think BCT, division, and Corps, but if you'd like the specific number, I can get that for you. Over.
JON HARPER: Okay, so you said over the next several years. Were you talking about doubling the number of personnel in the cyber branch and do you know how many years that would be? Are we talking like over the (unintelligible) over five years or the next couple of years? Are you able to give a more specific time?
LTG MORRISON: So it's being done in accordance with our Total Army Analysis process we're obviously in the midst of that right now. So adjusting when that endpoint might be based off of resourcing, etc, and quite frankly building some fairly highly trained and skilled operators, but it's in the 27-28 time frame. Over.
JON HARPER: Great. Thank you.
LTG MORRISON: And Jon, I can get you specifics on that if you'd like.
JON HARPER: Yeah, that would be great. I'd really appreciate it.
LTG MORRISON: Okay, we'll work that and get you something later today or tomorrow? Does that work?
JON HARPER: Sure. That would be great. Thanks.
PAO: Okay, we've gone around the list. So now I'm going to open it up to anyone who has a question. Please identify yourself again and please try to not dominate the whole conversation with questions. Go ahead anybody who has a question?
JASON MILLER: Hey, Bruce. This is Jason Miller from Federal News Network. I'll take another round if that's okay.
PAO: Go ahead Jason.
JASON MILLER: Thanks. So I want to go back to something that Dr. Iyer said around the business systems investment of about 1.4 billion dollars in 2023. You called it a marquee effort. Can you go a little bit more into that and what are some of the priorities around the business systems modernization? I think you also just mentioned, or maybe General Morrison mentioned, that you all made some hard decisions around business systems just recently. If you could tag that back, what were those decisions? And whatever other details you can share.
DR. IYER: Yeah so 1.4 billion dollars that's our entire portfolio of enterprise business systems - so these are the systems that run essentially all our financial, our logistics, our human resources, our training and so on and so forth. So it's all of our institutional Title X processes. They are dominated by five ERP systems all based upon SAP and then there's one that's IPPS-A that's based on Oracle PeopleSoft. And so that is our, what we call our business systems portfolio. What we are doing, like I said, in 23 is we're starting our modernization effort. That modernization effort is called Enterprise Business Systems Convergence. The word convergence means really we're looking at converging many of these systems that includes these five ERPs, and there's 150 other non-ERP Legacy systems in that portfolio and we're trying to converge them into a single architecture, into a single system if we can to the best extent possible so that we have one integrated capability, you know? And then more importantly, the data that we can pass across that spectrum of operations for analytics and so on. So it is a massive, multi-year modernization effort. We fully expect that it will be as high as 10 years for us to get to that modernization effort. But the approach that we're taking is more of not a big bang approach that we've typically used from the past. This is going to be more of an evolutionary modernization approach. Since it is a convergence effort this gets back to the discussion we talked about earlier - these 150 Legacy systems that are out there and those five ERPs we are taking a hard look at whether they still have value in the future, whether they're built on technology that can be migrated to the cloud and whether the total cost of ownership justifies us keeping those systems or sunsetting them or building them in the new system. So that rationalization process is underway. But along the way, we're also doing a hard look at business process re-engineering because what we have done with these legacy systems in these ERPs is really have custom, we have customized them in the past. We took out of the box SAP COTs products and we customized them because we felt that the Army had unique requirements that could not be made out of the box. And so, that has led to a high total cost of ownership for the Army over the years and that 1.4-billion-dollar budget that I talked about is partially reflective of the approaches that the Army took in the past. With this modernization effort, this convergence effort, we're trying to get to industry best practices and adopting out-of-the-box processes for financial management and so on and so forth.
Also of importance with these business systems is we want to make sure that these systems can support and meet the Army audit readiness requirements. The Army has committed to being committed to a clean audit for working capital fund by FY 24 and for all general funds by FY 27 and so for us to meet those requirements we want to make sure that the processes and the dollars, the funds that flow through the systems are fully auditable to get to a clean audit. So again both from an efficiency perspective but also in terms of making our processes more effective and audit ready is driving this requirement.
JASON MILLER: Thank you.
PAO: Anyone else have another question?
JON HARPER: This is Jon Harper again with DefenseScoop. Can you provide some more details about the prototyping for the Enterprise Business Systems convergence effort as well as the OTA for FY 23 and what that will entail?
DR. IYER: Yes, so sometimes this summer you're going to see the Program Executive Officer for Enterprise Information Systems put out an industry day and release what is called the request for white papers. And since we are going to use an OTA process for this acquisition, really, this is going to be a lot of interaction with industry to figure out what's out there that the Army can adopt rapidly, as well as, as I said earlier, future-proof the architecture. So we expect to award multiple prototypes in 23, in early 23, and these would run anywhere from 12 to 18 months. And then at the end of that effort just like any other OTA we will get to our production contract by down selecting one of those prototypes to be our production solution.
Some of the things that we will be looking for as part of this effort, this prototype, is to look at how modular the architecture is - again, to make sure that is future proof. We will be looking at the ability to support data exchange through APIs and microservices. This again will help us make sure that interoperability with other systems and to be able to use that data seamlessly across other systems and analytics is a huge driver. We will be looking at the system being Cloud-native from the get-go and making sure that we can fully benefit from a true modern architecture.
And then, like I said, we'll be looking at how flexible the solution will be in terms of its ability to implement Army unique processes where we have them without the need to customize commercial off-the-shelf products. So, some of you know….so these criteria will be laid out. We will work with industry to share the problem statement. We're going to intentionally keep it very high level because again we do not want to restrict industry from coming in and telling us
what the art of the possible is when it comes to solutioning this so we'll keep it intentionally at high-level, seek inputs and then look for multiple potentially different prototypes of different solutions from industry so that we can reduce any risk in implementation. Hopefully that answered….
JON HARPER: Great. Thank you. And are you able to say how much you anticipate the, after the down select, the production contract will be for this initiative?
DR. IYER: Yeah, not at this time because the approach, as I said, is because we're not going with a big bang approach and this is going to be evolutionary modernization, our approach is to look at doing this in an agile approach. And so we will we will let the priority, the functional priorities define what those increments will be. And then we will look at the risk profile to look at how quickly we can get those turned on, and that will determine the level of funding and the timeline for implementation. From an implementation perspective, one of the things that we're going to be pushing industry for is to truly do this using DevSecOps in an agile manner which means that we are looking for functionality to be available or released to users on rapid prints. Not taking years to do this. But doing this on literally two to six month increments and releases. And so again this is all about getting functionality in the hands of the user rapidly through agile development. Over.
JON HARPER: Great. Thank you.
PAO: Okay, I think we have time for one more question before we go to closing comments. Anybody have another question?
MATT BEINART: Hi, this is Matt Beinart from Defense Daily. If I can, I just have two quick clarification questions - separate topics. One, I don't have the unfunded priorities list in front of me. But was there anything on that list that fell under the digital transformation strategy umbrella that would kind of be critical for FY 23? And then separately, I wanted to double-check, has the Army released the unified network implementation plan yet? Thank you.
DR. IYER: Yeah so easy questions. So nothing on that UFR list as it relates to digital transformation because again, we ensure that all of those priorities in the Army Digital Transformation Strategy was part of our base budget and again because that strategy was approved by the Secretary and the Chief. We have full support to make sure that resources are aligned with the priorities there.
In terms of your second question of the Army Unified Network plan. It was absolutely released October of last year at AUSA. If you're not able to Google that and find that on the internet, we will make sure we can share a copy of that with you. But both that as well as the Army Digital Transformation Strategy are absolutely available and released.
LTG MORRISON: Hey Matt, if you're asking about the follow-on to the, are you asking about the follow-on to the Unified Network Plan?
MATT BEINART: Yeah. Yeah…..
LTG MORRISON: Yeah, great question. So yes, it was released shortly after October. It was not traditional - actually, let me rephrase that - it was very traditional. So the Army runs on orders and the way that we released the implementation plan was through an execution order because again, the unified network plan is not a Dr. Iyer or a John Morrison plan. It is an Army plan and we were assigning roles and missions and responsibilities to various commands throughout the Army. We've now got them in a governance structure that comes back up through Dr. Iyer and myself to the Undersecretary of the Army and the Vice. That's keeping everybody in sync as we move along the continuum of implementation. Does that help, over?
MATT BEINART: That does. Thank you.
PAO: All right. Well thank you very much. We've come to that point where we're going to go back to Dr. Iyer and General Morrison for closing comments. If you have any more questions or any clarifications you need or whatever, just send me an email and we'll get you answers. Dr. Iyer.
(Audio stopped)
STAFF: If you’re transmitting I do not hear anything.
DR. IYER: Can you hear me now? (Yes) Okay, great. Apologies for that. So….
LTG MORRISON: It was brilliant, by the way.
DR. IYER: It was all brilliant, except I was on mute, but no I want to again thank you all for taking the time this afternoon to continue the dialogue with us. I, as I said, I said up front I think we're postured well in 23 to scale and operationalize a lot of the modernization efforts that we initiated in 21, and then we're making great progress in 22 this year. But 23 is a year that we would really put these in the hands of users, and then that will drive further efficiencies and effectiveness in 24 and beyond. Now we’ve got to make sure that one of the things that we are staying on top of while we're doing all of this is cybersecurity. It is very clear that we're moving into an era where everyone of our technologies will be contested whether it's here in In the homeland or whether we're out in the actively deployed. And so we need to make sure that cybersecurity protection and that zero trust architecture is built into everything we do. To us it is not a buzzword. We have made it very clear that we have specific initiatives underway when it comes to zero trust and it will drive the architecture of every little thing that we do. It is not the old model of where we build something and then we try to protect it later - that kind of defense approach of protection from the outside is no longer really going to work in the future threat environment. So, managing those cybersecurity threats will be important. And so from a resourcing perspective even though we show a 2-billion-dollar investment in cyber, I can tell you that that the change in culture of how we build in security is in every one of those portfolios across an entire 16.6-billion-dollar budget.
The second thing I want to note that I should have mentioned up front is the Army has benefited well with some of the authorities that Congress has given us including one called BA8 pilot or colorless money. And so when we met with the Congressional staffers last week and the week before we have highlighted to Congress how that colorless money pilot has helped us on one program where we're implementing defensive cyber operations schools and has truly shown us that when we have flexibility in terms of being able to use single color money across the spectrum of research and development prototyping, implementation and support it enables us to continuously modernize, be able to continuously look for new technologies and new COTS products that are rapidly coming up in this space and so we're not locked into one solution and then we transition something into sustainment sometime down the road. So, we're showing how DevSecOps goes hand-in-hand with the ability to use authorities like BA8 and colorless money to do this.
LTG MORRISON: Could I amplify one point as well?
DR. IYER: Yes, please go ahead.
LTG MORRISON: What Dr. Iyer just sat there and said about the DevSecOps piece of this is critical, and I draw your attention to the SEC piece of it (DEVSECOPS) because it's not just changing capabilities and technology, it's also when the threat changes, which happens every single day in this space. So that ability to get the rapid turn as the threat picture changes and to address the threat has been absolutely critical to our defensive cyber capabilities.
I'm sorry, sir.
DR. IYER: Yeah, thank you. And then there is one risk that I want to make sure that ______
STAFF: Sir, you cut out again.
DR. IYER: Can you hear me now?
STAFF: Yes, sir.
DR. IYER: Okay, great. So there's one other risk that I want to make sure that that I was transparent with and that is the rate of inflation. And I know we didn't discuss that here in some detail but the Army has built in some level of inflation based upon the OMB estimates that were given to us last year. It was late last year and that was the numbers we went with. Clearly, the inflation rates right now are much much higher than what we have budgeted for so when we get into 23 we're going to have to carefully watch in the year of execution what the inflation looks like and then to be able to either submit requests for reprogramming actions or supplementals…and again that would be at the Army’s or actually would be at the DoD level working with Congress depending upon what impacts are, based upon potentially if the inflation rates stay as high as they are today. But we're watching that very closely as we get into 23. There are some levers that we can pull at the Army level to make sure that we stay within budget, but it's certainly something that we're watching very, very closely. So, so with that, I will turn it over to Gen Morrison for his final closing comments.
LTG MORRISON: Sir, thanks for that. And I'll be, I'll be brief. I'll sort of leave it where I started. So I see the fiscal environment. It's always a little bit challenging, but I think we are still on that trajectory to really continue a hard pivot to this notion of a unified network. I will tell you, I think the convergence of capabilities that we are seeing today and the ability to bring together the power of what's happening at the Enterprise with things like cArmy and the alignment of our modernization initiatives is really going to bring an operational effectiveness to our forces in the field that is going to be unprecedented. It will be data-centric and it will be able to meet the Secretary’s objective of being able to operate in a contested and congested environment against the near-peer adversary.
We're on a bit of a journey some of the things we're going to have to think really hard about because the model that Dr. Iyer and I are talking to you about is not necessarily buying things, it may be something that's as-a-service but still yet supporting tactical operations. That's a completely different way of thinking but it's quite frankly, the way the world is trending. And if we really want to bring this convergence of capabilities together, we're going to have to think differently as we move forward.
Again, thanks very much. Jon, I acknowledge we owe you a little bit of information on the growth of cyber and we'll make sure we get that over to you. And again, thanks for the opportunity today.
-END-
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