Excerpt from Reducing the Cost of Pentagon Travel Processing

The potential benefits from dod adopting best practices are in credible. If dod gets down to 15 percent rather than 30 - and this is still an inefficient level - they could save over half a billion dol lars a year. If they get down to 10 percent, the industry average, they could save around $700 million a year. If they could get down to the best-practice level - and this is achievable - they could save over $800 million a year. If they could ever get down to the level that Allied Signal is at, they could save around a billion dollars a year.

In addition to the savings, again, I want to point out, they are making life easier for their employees. They treat employees as customers of the process.

Now, we have been very pleased with the progress that dod has made. We like their plans. We like the commitment that has been made by top management. However, implementation Of this is going to be difficult. First, dod may need waivers. We are not sure yet, but they may need some waivers from existing travel rules and regulations. They will certainly need to make major changes to their policies. However, as you pointed out in your Opening state ment, these are not major impediments to improving the process.

What will probably be the primary problem within dod is changing the culture where each service and even branches within each service have their own travel processes, rules, and regulations and typically have resisted opportunities to make significant changes in standardized systems and processes.

In order for this cultural bias to be overcome, in order to begin to achieve these benefits, it is going to take the really continued, very strong leadership by both the Deputy Secretary and Dr. Hamre. So we are encouraged, but we are waiting to see how the implementation is actually carried out.

That concludes my summary, Mr. Chairman. I would be very pleased to answer any questions you might have.

Senator cohen. I am going to yield to Senator Levin, but before doing so, I just want to make one point.

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