E-biz upgrade on hold

An Internet-enabled financial management application is available that could let more than 6,500 shipboard mariners file purchasing documents and other data, but Military Sealift Command officials are holding back on an upgrade.

MSC deployed Version 8 of Oracle Corp.'s relational database management system and Release 11 of the company's financial management applications in July 2000 for less than $30 million, said Bill Savitsky, MSC's comptroller. The cost included training more than 1,000 users among MSC's 2,150 onshore workforce, he said.

MSC officials are holding off on upgrading to Release 11i — the latest Internet-enabled, e-business-friendly version of the Oracle applications — for a variety of reasons.

First, MSC must figure out how to manage the resulting bandwidth demands. An onshore procurement — Electronic Data Systems Corp.'s Navy Marine Corps Intranet contract — could help the Navy upgrade its on-ship communications infrastructure, Savitsky said. Another bandwidth solution, using commercial satellites to download data through the Internet, is too expensive, he said.

Another reason MSC officials are holding off on the upgrade is that they don't think their suppliers are ready for e-commerce yet, Savitsky said.

Much of MSC's $2 billion budget goes to pay international suppliers. "We're not dealing with General Motors," he said, referring to some of MSC's smaller suppliers. Many of them would rather send an overnight delivery envelope to an MSC disbursement office to get paid rather than have the command send the money via electronic funds transfer, Savitsky said.

At any given time, MSC operates or contracts for as many as 200 ships to deliver food, gasoline and other products to armed forces vessels.

MSC is close to having auditable records — a requirement of the Chief Financial Officers Act of 1990 — thanks to the Oracle software, which tracks project accounting, inventory, and accounts receivable and payable, as well as fixed assets, purchasing and general ledger accounting, Savitsky said.

MSC officials had planned to deploy the Corps of Engineers Financial Management System when John Hamre, the former deputy secretary of Defense, had named it as the Defense Department's mandatory joint financial management system. But because CEFMS wouldn't enable MSC to bill for fee-for-service work, and the system missed a planned 1999 deployment deadline, MSC officials looked for an alternative, Savitsky said.

Oracle had a product that met federal financial management guidelines and also could convert foreign currency, so MSC officials chose it over competing products, Savitsky said.

And to avoid the temptation to alter Oracle's software to meet their needs, MSC officials reworked nine business practices to conform to the commercial software and are performing manually the 10th incompatible business practice they found, he said.