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Cohen: Business Reform Equals Modernization

By Linda D. Kozaryn
American Forces Press Service

WASHINGTON, April 1, 1997 – It will take a "revolution in business affairs" to pay for modernization, Defense Secretary William S. Cohen said.

"We have slipped on modernization," Cohen told the Navy League Exposition here March 27. "We have continued to push modernization further and further into the future, which means we've got a much steeper hill to climb."

The department's goal is to have about $60 billion a year for modernization by 2001, Cohen said. Achieving that kind of expenditure will require departmentwide reform, he said.

"There is no excuse for not operating more efficiently," he said. "Acquisition reform is already beginning to revolutionize the quality, speed and cost of incorporating ... new technology into the force."

Excess infrastructure must be cut. "We still have a tendency to do many things in-house that private firms can do better, so we have to curb it," he said. "We still use a logistics supply system that operates according to the old military mindset of 'just in case,' instead of the modern business mindset of 'just in time.' We've got to change it."

Cohen admitted acquisition reform alone probably will not save enough to meet modernization needs. He said DoD's Quadrennial Defense Review is taking a hard look at all aspects of the department.

Everything is on the table for review, Cohen said. Defense officials are evaluating strategy, force structure, modernization, readiness, infrastructure, human resources and information operations and intelligence, he said. Defense officials are seeking the right match of strategy, programs and resources to fit within an annual budget of about $250 billion in real terms for the foreseeable future, he said.

"All of the easy choices have been made," Cohen said. "That's why this process we're going through right now is so important."

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