By Megan McIntyre, ASC Public Affairs and Lt. Col. Steven T. Wall, ASA (ALT) Liaison to CG, ASCAugust 2, 2011
ROCK ISLAND, Ill -- The United States Army Sustainment Command at Rock Island Arsenal, Ill., and St. Ambrose University are working together to enhance contracting capabilities. The Davenport, Iowa, university provides a Cost Benefit Analysis course to the ASC workforce.
According to St. Ambrose officials, the two-year old course focuses on the development of integrative analytical, problem-solving and decision-making skills for leaders and those aspiring to positions of leadership. The intended objective is to assist executive staff in guiding the CBA process in their respective organizations.
Maj. Gen. Yves J. Fontaine, commanding general of the Army Sustainment Command, explains the utility of CBA when making decisions on how the Army commits its resources, “We need to consider costs up front, before the decision is made, understand how much benefit will be derived, know and identify who is paying for the recommended course of action and take into account the second- and third-order effects of our decisions.”
“In other words,” Fontaine continued, “what is the ripple effect of the recommended course of action? The recommended COA may solve our immediate problem, but it may also create effects we will have to deal with.”
With a global reach through its seven brigades, Army Sustainment Command is the linchpin of the Materiel Enterprise, applying business case analysis to a wide variety of activities. Missions ranging from battlefield logistics support to prepositioned stocks demand careful analysis to yield innovative and cost-effective solutions.
Former Secretary of Defense Robert M. Gates directed any new proposal or initiative, regardless of size or function, be accompanied by a cost estimate. The price tag will help determine whether the gain is worth the cost, either in dollar terms or in the diversion of limited manpower and resources from other missions.
Defining affordable and fiscally informed investments of resources to meet its rapidly evolving missions challenges ASC planners. Decisions are derived from critical reviews of the costs, benefits and risks, as well as requirement and technology trade-offs " balanced against other missions and measured against available resources over time. Integration of the resource-informed decision results in the fielding of required capabilities and services to units and Soldiers. It is a process of synchronizing requirements, programming, acquisition and sustainment and is critical in identifying gaps and redundancies.
“Today, we are involved in combat operations around the world against adaptive enemies to take advantage of the ever-increasing pace of technological change,” said John M. McHugh, Secretary of the Army. “Concurrently, we are facing an increasingly constrained fiscal environment. To address these challenges and maintain our current technological edge for the future, we must change the way we develop and deliver capabilities.”
To improve its methods, ASC turned to St. Ambrose, which developed a Cost Benefit Analysis course, designed to inform the command on the best practices, techniques and applications of the Army’s CBA process.
In the classroom, students learn CBA is a structured methodology for forecasting and comparing the anticipated costs and benefits of alternative courses of action in order to identify the optimum solution for achieving a stated goal or objective. In other words, identify alternative courses of action for solving a problem, determine their costs and benefits and then recommend the best course of action for that situation.
“The objective is to produce a strong value proposition " a clear statement that the benefits more than justify the costs and risks,” said Joan A. Muskeyvalley, a CBA student and ASC employee.
Dr. John Byrne, a St. Ambrose marketing department professor and instructor of the course, said military and civilian students, take away tremendous value from the course.
“This value includes a strong understanding of the cost benefit analysis process, understanding their own tendencies towards making decisions and working as a member of a team,” he said. “They also take away skill development in negotiation, conflict management, financial analysis, teambuilding, collaboration and developing important relationships with colleagues working for the U.S. Army.”
Each class concludes with student presentations of actual ASC CBA topics. One recent example was an analysis of manpower requirements for enduring mission capability. Class presentations are evaluated by a panel of military, industry and academic experts.
Byrne has also taken his classroom overseas, including a recent journey to the 405th Army Field Support Brigade in Germany, where he taught a five-day course.
“This is highly important training to the Army, based on the current emphasis placed on being fiscally responsible in a decreasing budget environment,” said Byrne. “In addition, it is consistent with the mission of the Army to make the best decisions to serve and protect our country.”
Byrne continued, “We are always delighted and proud to support the Army in achieving its mission of keeping our country safe and secure.” He said as an educational institution, St. Ambrose is interested in working with students and organizations to provide high quality education to enrich the lives of others. “We believe our relationship with the Army accomplishes this objective.”
For its part, ASC is accomplishing its objective of preparing a more capable workforce.