ANCHORING SEA ENTERPRISE

RAAUZYUW RUENAAA0008 3631813-UUUU--RHMFIUU.
ZNR UUUUU ZUI RUEWMCS0418 3632025
R 291813Z DEC 05
FM CNO WASHINGTON DC//N00//
TO NAVADMIN
INFO RHMFIUU/CNO WASHINGTON DC//N00//
RUENAAA/CNO WASHINGTON DC//N00//
BT
UNCLAS //N05000//
NAVADMIN 341/05
MSGID/GENADMIN/CNO WASHINGTON DC/N00/DEC//
SUBJ/ANCHORING SEA ENTERPRISE//



GENTEXT/REMARKS/1.  AS WE APPROACH THE FOURTH ANNIVERSARY OF OUR SEA
ENTERPRISE EFFORT, IT IS APPROPRIATE THAT WE TAKE STOCK OF OUR
PROGRESS.  THE PRESSURES THAT GAVE RISE TO SEA ENTERPRISE HAVE, IF
ANYTHING, INTENSIFIED.  OUR NEED FOR REINVESTMENT DOLLARS HAS NEVER
BEEN MORE ACUTE.  THE SEA ENTERPRISE MANDATE IS CLEAR:  THE DAILY
DELIBERATE PURSUIT OF INCREASED EFFECTIVENESS AND EFFICIENCY.  IT IS
AN ALL HANDS UNDERTAKING LED BY LEADERS AT ALL LEVELS.
2.  SEA ENTERPRISE HAS TOUCHED A BROAD SPECTRUM OF OUR NAVY.  IT HAS
INCLUDED SIGNIFICANT INITIATIVES WITHIN AND ACROSS MAJOR CLAIMANTS,
INITIATIVES THAT HAVE PRODUCED OVER $27 BILLION IN SAVINGS AND COST
AVOIDANCE.  THIS SIGNIFICANT RETURN ON INVESTMENT IS THE BYPRODUCT
OF DOING BUSINESS BETTER AND HAS DEMONSTRATED THE FALLACY OF WHAT
SOME WOULD CLAIM WERE UNCHANGEABLE CHARACTERISTICS OF OUR NAVY:
- THAT WE ARE NECESSARILY A HIGH FIXED-COST ORGANIZATION.
- THAT OUR MANY INTERNAL ORGANIZATIONS NECESSITATE SEPARATE AND
INDEPENDENT STRATEGIES.
- THAT OUR NAVY IS TOO RIGID FOR LARGE-SCALE, LASTING CHANGE TO
OCCUR.
- THAT OUR BUREAUCRATIC CULTURE PREVENTS AN ENTERPRISE APPROACH
TOWARDS BUSINESS TRANSFORMATION.
- THAT THE STRUCTURE WITHIN WHICH WE OPERATE MITIGATES AGAINST
ACCOMPLISHING TRULY MEANINGFUL CHANGE.
3.  THE PROGRESS MADE TO DATE HAS REVEALED SOME FUNDAMENTAL
PRINCIPLES THAT TYPIFY SEA ENTERPRISE SUCCESS:
A.  SENIOR LEADERS DRIVE TRANSFORMATION:  SENIOR LEADERS SET
EXPECTATIONS.  THEY MUST BE IN ALIGNMENT ON WHY WE ARE TRANS-
FORMING, WHAT WE ARE TRANSFORMING, AND HOW WE ARE TRANSFORMING.
B.  LEADERS CREATE THE CULTURE OF CONTINUOUS IMPROVEMENT WE
SEEK:  DEFINING AND MEASURING OUTPUTS ASSOCIATED WITH INVESTMENT
STREAMS, CHALLENGING ASSUMPTIONS INHERENT IN PROCESSES,
UNDERSTANDING AND BALANCING RISK, AND ENSURING ACCOUNTABILITY IN
EXECUTION.
C.  ENTERPRISE ALIGNMENT OF ORGANIZATIONS AND PROCESSES: SHARING
BEST PRACTICES; LEVERAGING CORE COMPETENCIES; AND CONTINUOUS
IMPROVEMENT IN OPERATIONS, QUALITY, AND CYCLE-TIME ALL CONTRIBUTE TO
COST REDUCTION.  ALIGNMENT CAN ONLY BE REALIZED BY EXTENDING BOTH
THE BOUNDARIES AND DEPTH OF COLLABORATION ACROSS THE ENTERPRISE.
OUR CURRENT EMPHASIS ON STRENGTHENING THE FOCUS OF OUR WARFIGHTING
DOMAINS IS A KEY ELEMENT OF THIS EFFORT, DRIVING OUR BUSINESS
IMPROVEMENT FROM A CROSS-ENTERPRISE PERSPECTIVE TO MINIMIZE
REDUNDANCY AND ELIMINATE WASTE.
D.  EMBRACE BEST PRACTICES:  LEVERAGE THE LESSONS LEARNED AND BEST
PRACTICES FROM BOTH THE PRIVATE SECTOR AND GOVERNMENT.  GOOD
EXAMPLES ABOUND ON BOTH SIDES.  THE OPNAV N4 STAFF WILL HELP
IDENTIFY SUCH BEST PRACTICES THROUGH OUR SEA ENTERPRISE WEBSITE, BUT
LOCAL COMMAND EFFORTS ARE OFTEN THE BEST SOURCE FOR DISCOVERING NEW
IDEAS AND IMPROVED PROCESSES.
E.  DEVELOP BUSINESS ACUMEN:  PROVIDE THE NECESSARY BUSINESS
EDUCATION AND TRAINING AT ALL LEVELS.  WE WILL CONTINUE TO
CORPORATELY FOCUS ON PROVIDING NAVYS SENIOR EXECUTIVES WITH THE
KNOWLEDGE REQUIRED FOR MANAGING AND TRANSFORMING LARGE BUSINESS
UNITS.  OTHER OPPORTUNITIES EXIST AND SHOULD BE LEVERAGED INCLUDING
SENIOR ENLISTED ACADEMY, NAVY CORPORATE BUSINESS COURSE, FLEET
ON-LINE TRAINING THAT CAN BE ACCESSED AT WWW.FLEETBUSINESS.NAVY.MIL,
AS WELL AS LOCAL COMMAND EFFORTS.
4.  THE WAY AHEAD:  WE WILL PROCEED ALONG TWO PARALLEL PATHS.  THE
FIRST PATH WILL BE TO CONTINUE TO ACCELERATE COMMAND-SPECIFIC
BUSINESS TRANSFORMATION INITIATIVES ALREADY IN PROGRESS ACROSS OUR
NAVY.  AS YOU DO THIS WITHIN YOUR COMMAND, THE FOLLOWING RELATED
FACTORS MUST BE CONSIDERED TO BETTER UNDERSTAND AND CONTROL COSTS:
A.  KNOW YOUR BUSINESS:  KNOW YOUR BUSINESS LINES, THE CAPABILITIES
YOU PROVIDE (BUSINESS AREAS, PRODUCTS, AND/OR SERVICES), WHAT THEY
COST, WHAT THEY PRODUCE AND FOR WHOM, HOW TO MEASURE THEIR OUTPUTS,
AND WHERE THEY FIT IN THE VALUE CHAIN OF DELIVERING COMBAT
CAPABILITY TO OUR NAVY.  FOCUS ON DEMANDVERIFY THAT YOUR BUSINESS
LINES ARE ALL NEEDED, VALUED BY YOUR CUSTOMERS, AND THAT YOU ARE THE
ONE BEST ABLE TO DELIVER THEM.  BE WILLING TO DIVEST YOURSELF OF
BUSINESS LINES OTHERS CAN BETTER SUPPORT, PARTICULARLY IF THEY CAN
DO SO MORE EFFICIENTLY AND FREE YOU UP TO CONCENTRATE ON WHAT REALLY
ARE YOUR CORE LINES.
B.  DIG INTO YOUR PROCESSES:  EXPLORE EACH PROCESS WITHIN YOUR CORE
BUSINESS LINES.  UNDERSTAND YOUR COMMANDS OUTPUTS/COSTS.  SET
ACHIEVABLE PRODUCTIVITY IMPROVEMENT TARGETS.  OPTIMIZE PRODUCTION
CAPACITY AND DIVEST EXCESS CAPACITY TO FREE RESOURCES AND ELIMINATE
WASTE.  MAKE PROGRESS VISIBLE SO PEOPLE CAN SEE HOW THEIR ACTIONS
CONTRIBUTE TO SUCCESS.
C.  FOCUS ON EFFICIENT DELIVERY OF VALUE:  GREAT STRIDES ARE BEING
MADE ACROSS OUR NAVY WITH LEAN/SIX-SIGMA, AND THEORY OF CONSTRAINTS
TO CREATE EFFICIENCIES AND IMPROVE PRODUCTIVITY.  THIS EFFORT WILL
CONTINUE, AND MORE CAN BE DONE.  HOWEVER, AVOID THE TEMPTATION TO
START OPTIMIZING BEFORE DETERMINING WHAT FIRST NEEDS TO BE
OPTIMIZED.  IN OTHER WORDS, FIRST ENSURE WHAT YOU ARE DOING TRULY
ADDS VALUE AND IS BEST DONE BY YOU, BEFORE LOOKING FOR EFFICIENCIES.
ONCE YOU DO, YOU CAN CONTRIBUTE BY COMING TO WORK EACH DAY LOOKING
FOR WAYS TO IMPROVE HOW YOU DO WHAT YOU DO.
D.  CREATE A CULTURE OF INNOVATION:  ENSURE YOU HAVE MECHANISMS IN
PLACE TO BOTH SEEK NEW IDEAS AND RAPIDLY RESPOND TO THEM.  LEADERS
AT EVERY LEVEL SHOULD SET ASIDE TIME TO SEEK AND REVIEW INNOVATIVE
IDEAS, PUT IN PLACE A BUSINESS PLANNING PROCESS TO PRIORITIZE
THOSE IDEAS, AND FOCUS ON THE MAJOR INITIATIVES THAT CAN DRIVE OUT
THE MOST COST.  WE DO NOT SUFFER FROM A LACK OF IDEAS ACROSS OUR NAVY
OR WITHIN OUR COMMANDS, WE SUFFER IN NOT BEING AGILE ENOUGH TO
RESPOND TO THOSE IDEAS QUICKLY AND THEN CARRY THROUGH ON THEIR
EXECUTION.  IF THE IDEA IS NOT WITHIN YOUR AUTHORITY TO EXECUTE AND
YOU FEEL IT HAS VALUE, LEVERAGE THE CHAIN OF COMMAND.  IF AN
INITIATIVE IS IDENTIFIED WITH STRONG POTENTIAL BENEFIT THAT REQUIRES
CROSS-BOUNDARY SUPPORT, LEVERAGE THE CORPORATE BUSINESS COUNCIL
(CBC) FOR ASSISTANCE THROUGH THE SEA ENTERPRISE WEBSITE.
E.  CAPTURE THE SAVINGS:  AS SAVINGS ARE CREATED IT BECOMES MORE
IMPORTANT THAT WE DISCIPLINE OURSELVES TO NOT AUTOMATICALLY BUY MORE
CAPABILITY OR OTHER NICE TO HAVES.  SUCH RESOURCES SHOULD BE MADE
VISIBLE TO THE CORPORATION FOR USE BY NAVY LEADERSHIP TO ENSURE WE
ARE ADDRESSING OUR MOST PRESSING NAVY PRIORITIES.
5.  THE SECOND MAJOR PATH WE WILL FOLLOW WILL BE MORE "HORIZONTALLY"
FOCUSED (OR CROSS-BOUNDARY) IN NATURE.  OPPORTUNITIES EXIST TO
IMPROVE THE EFFECTIVENESS AND EFFICIENCY OF OUR COMMON OR CORPORATE
BUSINESS PROCESSES AND STRUCTURES--NAMELY IN ACQUISITION, SUPPLY
CHAIN MANAGEMENT, FINANCIAL MANAGEMENT, HUMAN CAPITAL MANAGEMENT,
AND BUSINESS INFORMATION SYSTEMS, AS WELL AS HOW WE MANAGE, AND ARE
STRUCTURED TO MANAGE THE ENTERPRISE.  WE HAVE MADE SOLID STRIDES IN
SEVERAL OF THESE AREAS, BUT MORE CAN BE DONE.  YOU WILL SEE THE
RESULTS OF THESE EFFORTS EMERGING AT THE MAJOR CLAIMANT LEVEL AS WE
PURSUE SOME ADDITIONAL REALIGNMENTS AND PROCESS IMPROVEMENTS.
6.  THE FISCAL REALITY WE FACE ARGUES WE REDOUBLE OUR EFFORTS TO
IMPROVE THE EFFECTIVENESS AND EFFICIENCY OF OUR OPERATIONS IF WE ARE
TO HELP GENERATE THE FUNDS NEEDED TO BUILD OUR FUTURE FORCE
STRUCTURE.  THIS IS AN ALL HANDS EFFORT LED BY LEADERS AT ALL
LEVELS.  I AM DEPENDING ON ALL OF YOU TO EMBRACE YOUR ROLE IN SEA
ENTERPRISE, AND THE RESPONSIBILITY EACH OF US HAS IN LEADING THE
TRANSFORMATION TO ACHIEVE OUR SEA POWER 21 VISION.
7.  LEARN MORE ABOUT SEA ENTERPRISE, SUCCESSES, AND RESOURCES AT
USN.HQ.NAVY.MIL/SEAENTERPRISE.
8.  RELEASED BY ADMIRAL MIKE MULLEN, CHIEF OF NAVAL OPERATIONS.//
BT
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