The U.S. Government Accountability Office in a recent report to Congress lambasted the U.S. Department of Defense Travel System (DTS). The latest criticism follows earlier GAO reports faulting DOD's implementation of the technology initiative and congressional requests that DTS should either be fixed to generate the targeted cost savings or canned.
GAO identified a number of challenges for DTS, including some that are specific to government programs, like ensuring use of Fly America carriers. But other challenges are familiar to all travel managers: fostering adoption, accurately measuring usage, achieving savings targets, improving automation, reconciling disparate travel management fee structures and ensuring management oversight.
Born in 1995 and envisioned as an automated, end-to-end, Web-based accounting, disbursement and travel service, DTS now is a half-billion dollar project scheduled for full deployment across 11,000 locations by the end of fiscal year 2007. According to program information, "no other private or public sector financial management or travel system approaches the breadth and technical depth of DTS." It has more than one million registered users, half of which already have used the system (45,000 on an average day).
But GAO's report, as well as the 2007 National Defense Authorization Act, implored DTS to enact various process improvements, effectively integrate technology and achieve greater buy-in. Though program managers have attempted to improve the system, "these actions do not fully address the fundamental problems we found during this audit and on which we have previously reported," GAO said.
In terms of aggregate cost reductions, GAO said the annual DTS net savings target of $56 million is "highly questionable," given problems in reducing fees paid to "commercial ticket offices" and cutting internal personnel expenses.
In 2003, DOD anticipated an average $13.50 reduction in per-ticket fees paid to CTOs, as most airline tickets processed through the "no-touch" reservations system would require no or minimal intervention. Across Army, Air Force, and Marine Corps locations, for example, previous air ticket transaction fees of $18.71 are to be cut to $5.25. However, GAO analyzed one program region and found no-touch per-ticket savings of "between $10 and $12."
For other regions, "the department has experienced difficulty in awarding new [travel management service] contracts with the lower fee structure," GAO explained, noting that DOD in May cancelled one solicitation. "The DTS office realized its solicitation didn't reflect what travel agency services it actually needed."
GAO specifically questioned the Navy DTS' expected per-ticket savings, since Navy CTO expenses are paid through a management fee structure, rather than transaction fees. Those management fees totaled $14.5 million during fiscal year 2005, or roughly $19 per ticket. "The management fee charged the Navy is the same regardless of the involvement of the CTO," GAO wrote. "Therefore, the reduced no-touch fee would not apply." GAO added that Navy DTS program officials still were considering the use of management fees after full DTS implementation, jeopardizing targeted CTO fee savings.
As a result, GAO recommended that DOD "evaluate the cost effectiveness" of CTO management fee structures. In response, DOD said the Defense Travel Management Office "is currently procuring commercial travel services for DOD worldwide in a manner that will ensure evaluation of cost effectiveness for all services."
Meanwhile, in the one analyzed region, GAO found a no-touch rate of "at best 47 percent," well below the 70 percent prediction. GAO questioned how the 70 percent target was established in the first place, noting that DTS assumptions were made solely on the basis of a single American Express report detailing the experience of "one private-sector company."
GAO also noted that overall reported DTS usage between Oct. 2005 and April 2006 was 53 percent for the Army, 39 percent for the Air Force and 30 percent for the Navy. "Resistance [to adoption] still exists," despite memos and mandates, GAO continued. Problems include a lack of sufficient user training and other usability concerns. For example, "Army DTS program officials stated that [DTS program management] does not do a good job of informing users about functionality changes made to the system," GAO explained. "We inquired if the Help Desk was able to resolve the users' problems, and the Army DTS officials simply stated 'no.' "
Another problem is an inability to measure actual usage. DTS "continues to rely on outdated information in the reporting of utilization to DOD management and Congress," according to GAO. "Best business practices indicate that a key factor of project management and oversight is the ability to effectively monitor and evaluate a project's actual performance against what was planned."
GAO also described specific challenges related to flight displays in self-booking tools, including incomplete listings of contracted city-pair fares and options that do not comply with the Fly America Act. As a result, DTS program managers "proposed increasing the amount of data obtained from the global distribution system," GAO said, noting that a "technology refresh" scheduled to be completed last month by DTS vendor Northrop Grumman Mission Systems also would alleviate flight display problems. That upgrade also would force travelers to justify pricier or otherwise non-contracted airline tickets, according to officials.
Sen. Tom Coburn (R-OK), a DTS critic, this summer advocated a "fee-for-use" system to "end the perverse incentives in the current contract that allows the contractor to be paid for a product that is underutilized and does not work properly when utilized."
Coburn's fee-for-use amendment to the Senate's version of the 2007 DOD authorization bill became a requirement in the revised legislation, now awaiting presidential approval, for the Secretary of Defense to conduct an independent study designed partly to examine the "feasibility of converting the travel reservation process to a fee-for-services system, or authorizing the use of multiple travel reservation processes."