TREASURY INSPECTOR GENERAL
FOR TAX ADMINISTRATION
Implementation of the New Methodology for Systems Modernization Needs Increased Focus and Support
Reference No. 2001-20-015
The Internal Revenue Service (IRS) is revamping business processes and implementing new technology, as part of its comprehensive modernization program. To assist in managing the modernization efforts for information systems, the IRS hired a contractor in December 1998. The contractor, along with the IRS, is modifying its existing business change methodology to meet the specific needs of the IRS. The modified methodology is known as the Enterprise Life Cycle (ELC). The ELC incorporates aspects of realizing a new business vision, from strategy development through system deployment and operations. The goal is to create IRS technology systems that improve taxpayer service, add new security features, and carry the agency into the new century.
The IRS has established a program management office, the Business Systems Modernization Office (BSMO), to oversee the modernization effort. Individuals within this office are responsible for the implementation of the ELC methodology. The objective of this audit was to assess the IRSí processes for development and implementation of the ELC for the Business Systems Modernization Program.
The IRS is making progress in implementing ELC processes and procedures required for effective management of the Business Systems Modernization Program. The BSMO "stood up," or was officially recognized, on July 13, 2000. Roles and responsibilities for the BSMO staff have been defined, and the IRS is in the process of ensuring these roles are effectively communicated and appropriate training is conducted.
However, documentation prepared by the PRIME contractor and accepted by the IRS indicates that completion targets for certain key ELC activities have been delayed beyond their initial deadline of September 2000, the implementation date indicated in the IRSí latest Congressional funding request.
Increased Focus on Completing Interim Tasks Is Needed to Ensure Further Enterprise Life Cycle Implementation Delays Do Not Occur
The IRS initially received $9 million in 2 increments to complete initial ELC deployment by October 31, 1999. The IRS later revised plans to deploy the first phase of the ELC and presented in its spending plan to the Congress that it would complete ELC deployment by September 30, 2000. The IRS received an additional $5.1 million to complete the ELC implementation as a result of the approval of the latest spending plan.
Although the IRS has made progress in implementing the ELC and deployment activities have started, target dates for completion of several key deployment activities, such as delivery of educational courses and implementation of strategies to communicate ELC processes, have been delayed beyond September 30, 2000. Completion of the initial training and communications initiatives is critical to ensure that the BSMO effectively manages and oversees the modernization effort. Delays in the implementation activities have resulted in delays in the progress of modernization projects and could result in additional delays, as well as lack of quality in project deliverables. In addition, implementation delays beyond target dates could cause the Congress to question future commitments the IRS makes regarding its implementation plans.
The Current Version of the Enterprise Life Cycle Lacks Key Components Needed by the Project Developers
The IRS has not completed the development of key components of the ELC. Procedures for Investment Decision Management, a key legislative requirement for government agencies, had not been fully incorporated into the ELC. In addition, key supplements to the ELC, such as the Enterprise Architecture, Security and Privacy, and Legacy Systems Transformation, have not been finalized.
The IRS and the PRIME contractor have established an automated library to store approved polices, procedures, and other guidance for using the ELC. Although this is a worthwhile endeavor, the library currently lacks the level of detail necessary to deploy the ELC. A sample of the libraryís users reported that they need more training on using the ELC and the associated library, more examples of completed work products, and better linkages and a centralized index in the automated library.
Because the ELC is a dynamic, evolving methodology, it is imperative that accurate, timely guidance be provided to project personnel. Inadequate ELC guidance, thus far, has resulted in inconsistency, inefficiency, and frustration in the preparation of project deliverables.
Enterprise Life Cycle Training Has Not Been Provided in a Timely Manner
At the time of our review, the overall Education and Development Plan for BSMO had been prepared, but individual training and lesson plans were not developed. One reason training efforts are not further along is because they were dependent on identification and definition of roles and responsibilities as well as an analysis of current skills. This identification and definition was not finalized until late June 2000.
Timely training for IRS and contractor employees working on the modernization projects is also at risk. At the time of our review, a formal needs-assessment for project training had not been conducted, and only 25 percent of the PRIME contractor staff in 2 of the IRSí critical projects attended the initial ELC course. Many of the untrained contractor staff were employees from firms that were sub-contractors to the CSC and, thus, they had less experience using the ELC methodology.
The PRIME Program Training Group is currently staffed with only three people, including one part-time instructor. This staffing level will be insufficient to modify and deliver the 41 courses that have been identified as necessary for the modernization project personnel.
Training plays an integral part in the deployment of ELC processes and procedures. Without adequate training, the IRS can expect continued delays in project development and an overall lack of quality control over the modernization effort.
Summary of Recommendations
We recommend that the IRSí Chief Information Officer (CIO) provide additional focus and support to the ELC Deployment Team, develop a validation process for the PRIME contractorís ELC deliverables, implement improvements to the ELC library, and expedite development and delivery of ELC guidance and training. In addition, we recommend that the CIO require the PRIME contractor to perform a training needs-assessment for the projects and a staffing analysis, in addition to increasing the staffing in its training group.
Managementís Response: Managementís response was due on October 26, 2000. As of October 30, 2000, management had not responded to the draft report.