United States General Accounting Office

GAO Report to the Chairman, Subcommittee

on Social Security, Committee on Ways

and Means, House of Representatives

June 1998 SOCIAL SECURITY

ADMINISTRATION

Technical and

Performance

Challenges Threaten

Progress of

Modernization

GAO/AIMD-98-136

GAO United States

General Accounting Office

Washington, D.C. 20548

Accounting and Information

Management Division

B-279868 

June 19, 1998

The Honorable Jim Bunning

Chairman, Subcommittee on Social Security

Committee on Ways and Means

House of Representatives

Dear Mr. Chairman:

This report responds to your request concerning the Social Security

Administration’s (SSA) ongoing efforts to implement its Intelligent

Workstation/Local Area Network (IWS/LAN) project.1

 As you know, SSA is in

the process of redesigning its work processes and modernizing its

computer systems to better serve an increasing beneficiary population and

achieve improvements in productivity. IWS/LAN is expected to play a major

role in this modernization effort by providing SSA with the basic

automation infrastructure to achieve increased processing capabilities that

will be essential to its major service delivery and process redesign

initiatives. The first phase of the planned project is a 7-year, approximately

$1 billion effort to acquire more than 56,000 intelligent workstations and

1,700 local area networks.

Because of the cost and resources that SSA plans to invest in acquiring

IWS/LAN and the project’s potential impact on public service, you requested

that we provide information on this initiative. Specifically, you asked us to

(1) determine the status of SSA’s implementation of IWS/LAN, (2) assess

whether SSA and state DDS operations have been disrupted by the

installations of IWS/LAN equipment, and (3) assess SSA’s practices for

managing its investment in IWS/LAN.

During testimony before the House Ways and Means Subcommittees on

Human Resources and Social Security in March 1998, we discussed

generally the challenges that SSA faces in implementing IWS/LAN and other

information technology initiatives.2

 This report provides additional and

more specific information on the issues identified during our review.

1

In June 1996, SSA awarded a national IWS/LAN contract to modernize and standardize the distributed

processing environment in its headquarters and field components and in state Disability Determination

Services (DDS). This initiative is intended to provide a distributed processing platform comprised of

intelligent workstations (i.e., personal computers) on employee desktops, connected to each other and

to SSA’s mainframe computers by local and wide area networks.

2

Social Security Administration: Information Technology Challenges Facing the Commissioner

(GAO/T-AIMD-98-109, March 12, 1998).

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Results in Brief SSA has moved aggressively in installing intelligent workstations and local

area networks (LAN) since initiating IWS/LAN acquisitions in December 1996.

As of mid-March 1998, it had completed the installation of about 31,000

workstations and 850 LANs, generally meeting its implementation schedule

for phase I of the initiative. However, the contractor that is installing

IWS/LAN has expressed concerns about the future availability of the

intelligent workstations that SSA is acquiring—noting that the

100-megahertz workstations specified in the contract are increasingly

difficult to obtain. In addition, problems encountered in developing

software intended to operate on IWS/LAN could affect SSA’s planned

schedule for proceeding with phase II of this initiative—an effort to

provide additional hardware and software to the computer infrastructure

created in phase I.

Staff in SSA offices generally reported no significant disruptions in their

ability to serve the public during the installation and operation of their

IWS/LAN equipment. However, some state DDSs reported that SSA’s decision

to manage and control DDS networks remotely and the IWS/LAN contractor’s

inadequate responses to DDS’ service calls have led to disruptions in some

of their operations. At least one state DDS deferred its installations of

IWS/LAN because of its concerns about the lack of network control in the

IWS/LAN environment. Because IWS/LAN is expected to correct Year 2000

deficiencies in some states’ hardware, delaying the installation of IWS/LAN

could affect these states’ progress in becoming Year 2000 compliant.

Consistent with the Clinger-Cohen Act of 1996 and Office of Management

and Budget (OMB) guidance, SSA has followed some of the essential

practices required to effectively manage its IWS/LAN investment. This

includes assessing costs, benefits, and risks to justify the agency’s

investment in IWS/LAN and monitoring the progress of the project against

competing priorities, projected costs, schedules, and resource availability.

However, SSA has not established essential practices for measuring

IWS/LAN’s contribution to improving the agency’s mission performance.

Although the agency has developed baseline data and performance

measures that could be used to assess the project’s impact on mission

performance, it has not defined target performance goals or instituted a

process for using the measures to assess the impact of IWS/LAN on mission

performance. Further, although the Clinger-Cohen Act and OMB

requirements call for agencies to perform evaluations after completing

information technology projects, SSA does not plan to conduct a

post-implementation review of IWS/LAN once it is fully implemented.

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Without targeted goals and a defined process for measuring performance

both during and after the implementation of IWS/LAN, SSA cannot be assured

of the extent to which this project is improving service to the public or

that it is actually yielding the savings anticipated from this investment.

Background Handling increasing service workloads is a critical challenge facing SSA.

The agency is processing a growing number of claims for Social Security

benefits.3 SSA estimates that it will face continued growth in beneficiaries

over the next few decades as the population ages and life expectancies

increase. The number of OASI and DI beneficiaries is estimated to increase

substantially between calendar years 1997 and 2010—from approximately

44 million to over 54 million.

Recognizing constraints on its staff and resources, SSA has moved to better

serve its increasing beneficiary population and improve its productivity by

redesigning its work processes and modernizing the computer systems

used to support these processes. A key aspect of the modernization effort

is the agency’s transition from its current centralized mainframe-based

computer processing environment to a highly distributed client/server

processing environment.4

IWS/LAN is expected to play a critical role in the modernization by providing

the basic automation infrastructure for using client/server technology to

support the redesigned work processes and improve the availability and

timeliness of information to employees and appropriate users. Under this

initiative, SSA plans to replace approximately 40,000 “dumb” terminals and

other computer equipment used in over 2,000 SSA and state DDS sites with

an infrastructure consisting of networks of intelligent workstations

connected to each other and to SSA’s mainframe computers.5

3

The Old Age and Survivors Insurance (OASI) and the Disability Insurance (DI) programs, together

commonly known as Social Security, provide benefits to retired and disabled workers and their

dependents and survivors.

4

In a client/server environment, servers and individual workstations are all capable of performing tasks

that previously only the mainframe computer could accomplish. This can sometimes result in

improvements over mainframe performance.

5

SSA’s “dumb” terminals are connected to its mainframe computers through its data network and are

controlled by software executed on the mainframes. Its personal computers, called intelligent

workstations, have their own data storage and processing capabilities.

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The national IWS/LAN initiative consists of two phases. During phase I, SSA

plans to acquire 56,500 workstations,6 1,742 LANs, 2,567 notebook

computers, systems furniture, and other peripheral devices.

Implementation of this platform is intended to provide employees in the

sites with office automation and programmatic functionality from one

terminal. It also aims to provide the basic, standardized infrastructure to

which additional applications and functionality can later be added. The

projected 7-year life-cycle cost of phase I is $1.046 billion, covering the

acquisition, installation, and maintenance of the IWS/LAN equipment. Under

a contract with Unisys Corporation, SSA began installing equipment for this

phase in December 1996; it anticipates completing these installations in

June 1999. Through fiscal year 1997, SSA had reported spending

approximately $565 million on acquiring workstations, LANs, and other

services.7

Phase II is intended to build upon the IWS/LAN infrastructure provided

through the phase I effort. Specifically, during this phase, SSA plans to

acquire additional hardware and software, such as database engines,

scanners, bar code readers, and facsimile and imaging servers, needed to

support future process redesign initiatives and client/server applications.

SSA plans to award a series of phase II contracts in fiscal year 1999 and to

carry out actual installations under these contracts during fiscal years 1999

through 2001.

Currently, SSA is developing the first major programmatic software

application to operate on IWS/LAN. This software—the Reengineered

Disability System (RDS)—is intended to support SSA’s modernized disability

claims process in the new client/server environment. Specifically, RDS is

intended to automate and improve the Title II and Title XVI8

 disability

claims processes from the initial claims-taking in the field office, to the

gathering and evaluation of medical evidence in state DDSs, to payment

execution in the field office or processing center and the handling of

appeals in hearing offices. In August 1997, SSA began pilot testing RDS for

the specific purposes of (1) assessing the performance, cost, and benefits

6

At the conclusion of our review, SSA officials were considering options for acquiring additional

workstations under the national initiative, which, if exercised, could result in the installation of as

many as 70,000 workstations.

7

The other services include site preparation, support services and training, and telecommunications

and maintenance.

8

Titles II and XVI of the Social Security Act authorize SSA’s Old Age, Survivors, and Disability

Insurance and Supplemental Security Income programs, respectively.

Page 4 GAO/AIMD-98-136 SSA Modernization
B-279868 

of this software and (2) determining supporting IWS/LAN phase II equipment

requirements.

Agencies, in undertaking systems modernization efforts, are required by

the Clinger-Cohen Act of 1996 to ensure that their information technology

investments are effectively managed and significantly contribute to

improvements in mission performance. The Government Performance and

Results Act of 1993 requires agencies to set goals, measure performance,

and report on their accomplishments. One of the challenges that SSA faces

in implementing IWS/LAN is ensuring that the planned systems and other

resources are focused on helping its staff process all future workloads and

deliver improved service to the public. In a letter and a report to SSA in

1993 and 1994, respectively, we expressed concerns about SSA’s ability to

measure the progress of IWS/LAN because it had not established measurable

cost and performance goals for this initiative.9

In addition, SSA faces the critical challenge of ensuring that all of its

information systems are Year 2000 compliant. By the end of this century,

SSA must review all of its computer software and make the changes needed

to ensure that its systems can correctly process information relating to

dates. These changes affect not only SSA’s new network but computer

programs operating on both its mainframe and personal computers. In

October 1997, we reported that while SSA had made significant progress in

its Year 2000 efforts, it faced the risk that not all of its mission-critical

systems will be corrected by the turn of the century.10 At particular risk

were the systems used by state DDSs to help SSA process disability claims.

Objectives, Scope,

and Methodology

Our objectives were to (1) determine the status of SSA’s implementation of

IWS/LAN, (2) assess whether SSA and state DDS operations have been

disrupted by the installations of IWS/LAN equipment, and (3) assess SSA’s

practices for managing its investment in the IWS/LAN initiative.

To determine the status of SSA’s implementation of IWS/LAN, we analyzed

key project documentation, including the IWS/LAN contract, project plans,

and implementation schedules. We observed implementation activities at

select SSA field offices in Alabama, Florida, Georgia, Minnesota, South

9

Letter from the Director, Human Resources Information Systems, Information Management and

Technology Division, GAO, to the Acting Commissioner of SSA, March 30, 1994; and Social Security

Administration: Risks Associated With Information Technology Investment Continue

(GAO/AIMD-94-143, September 30, 1994).

10Social Security Administration: Significant Progress Made in Year 2000 Effort, But Key Risks Remain

(GAO/AIMD-98-6, October 22, 1997).

Page 5 GAO/AIMD-98-136 SSA Modernization
B-279868 

Carolina, Texas, and Virginia; at program service centers in Birmingham,

Alabama, and Philadelphia, Pennsylvania; and at teleservice centers in

Minneapolis, Minnesota, and Fort Lauderdale, Florida. In addition, we

reviewed IWS/LAN plans and observed activities being undertaken by state

DDS officials in Alabama, Georgia, and Minnesota. We also interviewed

representatives of the IWS/LAN contractor—Unisys Corporation—to discuss

the status of the implementation activities.

To assess whether SSA and state DDS operations have been disrupted by the

installations of IWS/LAN equipment, we reviewed planning guidance

supporting the implementation process, such as the IWS/LAN Project Plan,

and analyzed reports summarizing implementation activities and

performance results identified during pilot efforts. We also interviewed SSA

site managers, contractor representatives, and IWS/LAN users to identify

installation and/or performance issues, and observed operations in select

SSA offices where IWS/LAN equipment installations had been completed. In

addition, we discussed IWS/LAN problems and concerns with DDS officials in

10 states: Alabama, Arkansas, Arizona, Delaware, Florida, Louisiana, New

York, Virginia, Washington, and Wisconsin, and with the president of the

National Council of Disability Determination Directors, which is a

representative body for all state DDSs.

To assess SSA’s management of the IWS/LAN investment, we applied our

guide for evaluating and assessing how well federal agencies select and

manage their investments in information technology resources.11 We

evaluated SSA’s responses to detailed questions about its investment

review process that were generated from the evaluation guide and

compared the responses to key agency documents generated to satisfy

SSA’s process requirements. We also reviewed IWS/LAN cost, benefit, and

risk analyses to assess their compliance with OMB guidance. We did not,

however, validate the data contained in SSA’s documentation.

We performed our work from July 1997 through March 1998 in accordance

with generally accepted government auditing standards. We requested

comments on a draft of this report from the Commissioner of Social

Security or his designee. The Commissioner provided us with written

comments, which are discussed in the “Agency Comments and Our

Evaluation” section and are reprinted in appendix I.

11Assessing Risks and Returns: A Guide for Evaluating Federal Agencies’ IT Investment

Decision-making, Version 1 (GAO/AIMD-10.1.13, February 1997).

Page 6 GAO/AIMD-98-136 SSA Modernization
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SSA Met Its IWS/LAN

Milestones Through

March 1998, but

Future Milestones

May Be Missed

Using a strategy that includes installing workstations and LANs in up to 20

sites per weekend, SSA, through mid-March 1998, had generally met its

phase I schedule for implementing IWS/LAN. However, the contractor

installing IWS/LAN has expressed concerns about the availability of the

workstations specified in the contract, raising questions as to whether

they can continue to be acquired. In addition, the pilot effort that SSA

began in August 1997 to assess the performance, cost, and benefits of RDS

and identify IWS/LAN phase II requirements has experienced delays that

could affect the schedule for implementing phase II of this initiative.

IWS/LAN Phase I

Implemented on Schedule

Through March 1998

Under the phase I schedule, 56,500 intelligent workstations and 1,742 LANs

are to be installed in approximately 2,000 SSA and state DDS sites between

December 1996 and June 1999. The schedule called for approximately

30,500 workstations and about 850 LANs to be installed by mid-March 1998.

According to SSA records, the agency generally met this schedule with the

actual installation of 31,261 workstations and 850 LANs by March 15, 1998.

These installations occurred at 753 SSA sites and 20 DDS sites12 (covering 12

states and the federal DDS).13 SSA reported in its fiscal year 1997

accountability report that the number of front-line employees using IWS/LAN

increased to 50.2 percent—exceeding by 2.2 percent the fiscal year 1997

Results Act goal.14

The standard intelligent workstation configuration includes a

100-megahertz Pentium personal computer with 32 megabytes of random

access memory, the Windows NT 4.0 operating system, a 1.2-gigabyte hard

(fixed) disk drive, 15-inch color display monitor, and 16-bit network card

with adaptation cable. Last year the contractor, Unisys, submitted a

proposal to upgrade the intelligent workstation by substituting a higher

speed processor at additional cost. Unisys noted that it was having

difficulty obtaining 100-megahertz workstations. However, SSA did not

accept Unisys’ upgrade proposal. Further, the Deputy Commissioner for

Systems stated that SSA did not believe it was necessary to upgrade to a

faster processor because the 100-megahertz workstation meets its current

needs.

12Some of these DDS sites had received only partial installations of IWS/LAN.

13The federal DDS provides back-up services to state DDSs when the state offices cannot process their

workloads and serves as a model office for testing new technologies and work processes.

14Social Security Administration Accountability Report for Fiscal Year 1997.

Page 7 GAO/AIMD-98-136 SSA Modernization
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For its modernization efforts to succeed, SSA must have the necessary

workstations to support its processing needs. This is particularly

important given the agency’s expressed intent to operate future

client/server software applications on IWS/LAN to support redesigned work

processes. Adding database engines, facsimile, imaging, and other features

like those planned by SSA during phase II of the IWS/LAN initiative could

demand a workstation with more memory, larger disk storage, and a

processing speed higher than 100 megahertz. Personal computers available

in today’s market operate at about three times this speed.

Preliminary testing of the RDS software has already shown the need for SSA

to upgrade the workstation’s random access memory from 32 megabytes

to 64 megabytes. However, systems officials told us that their tests have

not demonstrated a need for a faster workstation. As discussed in the

following section, SSA is encountering problems and delays in completing

its tests of the RDS software. In addition, at the conclusion of our review,

SSA had begun holding discussions with Unisys regarding the availability of

the 100-megahertz workstations.

Problems in RDS Pilot

Could Delay IWS/LAN

Phase II Implementation

SSA has experienced problems and delays in the pilot effort that it initiated

in August 1997 to assess the performance, cost, and benefits of RDS and

identify IWS/LAN phase II requirements. Under the pilot, an early release of

the software is being tested in one SSA field office and the federal DDS to

acquire feedback from end users regarding its performance. SSA planned to

make improvements to the software based on these pilot results and then

expand its testing of the software to all SSA and DDS components in the

state of Virginia. The results of the pilot testing in Virginia were to be used

in determining hardware and software requirements to support IWS/LAN

phase II acquisitions, beginning in fiscal year 1999.

SSA encountered problems with RDS during its initial pilot testing. For

example, systems officials stated that, using RDS, the reported productivity

of claims representatives in the SSA field office dropped. Specifically, the

officials stated that before the installation of RDS, each field office claims

representative processed approximately five case interviews per day. After

RDS was installed, each claims representative could process only about

three cases per day.

At the conclusion of our review, systems officials stated that because the

RDS software has not performed as anticipated, SSA has entered into a

contract with Booz-Allen and Hamilton to independently evaluate and

Page 8 GAO/AIMD-98-136 SSA Modernization
B-279868 

recommend options for proceeding with the development of RDS. In

addition, SSA has delayed expanding the pilot by 9 months—from October

1997 to July 1998. This is expected to further delay SSA’s national roll-out

and implementation of RDS.

15 Moreover, because RDS is essential to

identifying IWS/LAN phase II requirements, the Deputy Commissioner for

Systems has stated that delaying the pilot will likely result in slippages in

SSA’s schedule for acquiring and implementing phase II equipment.

SSA Offices Reported

Smooth Transition to

IWS/LAN, but

Network Management

Concerns in State

Offices Could Affect

Service to the Public

Nationwide implementation of IWS/LAN is a complex logistical task for SSA,

requiring coordination of site preparation (such as electrical wiring and

cabling) in over 2,000 remote locations, contractor-supplied and installed

furniture and intelligent workstation components, and training of over

70,000 employees in SSA and DDS locations. Moreover, once installed, these

systems must be managed and maintained in a manner that ensures

consistent and quality service to the public.

During our review, staff in the 11 SSA offices that we visited generally

stated that they had not experienced any significant disruptions in their

ability to serve the public during the installation and operation of IWS/LAN.

They attributed the smooth transition to SSA’s implementation of a

well-defined strategy for conducting site preparations, equipment

installations, and employee training. Part of that strategy required

equipment installation and testing to be performed on weekends so that

the IWS/LAN equipment would be operational by the start of business on

Monday. In addition, staff were rotated through training and client service

positions and augmented with staff borrowed from other field offices to

maintain service to the public during the post-installation training period.

Further, because the new workstations provide access to the same SSA

mainframe software applications as did the old terminals and LAN

equipment, staff were able to process their workloads in a similar manner

as with the previous environment.

State DDSs generally were less satisfied with the installation and operation

of IWS/LAN in their offices. Administrators and systems staff in the 10 DDS

sites that we visited expressed concerns about the loss of network

management and control over IWS/LAN operations in their offices and

dissatisfaction with the service and technical support received from the

contractor following the installation of IWS/LAN equipment.

15In September 1996, we reported that software development problems had delayed the scheduled

implementation of RDS by more than 2 years. See Social Security Administration: Effective Leadership

Needed to Meet Daunting Challenges (GAO/HEHS-96-196, September 12, 1996).

Page 9 GAO/AIMD-98-136 SSA Modernization
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In particular, SSA initially planned to centrally manage the operation and

maintenance of IWS/LAN equipment. However, DDS officials in 7 of the 10

offices expressed concern that with SSA managing their networks and

operations, DDSs can no longer make changes or fixes to their equipment

locally and instead, must rely on SSA for system changes or network

maintenance. Eight of the 10 DDSs reported that under this arrangement,

the IWS/LAN contractor had been untimely in responding to certain of their

requests for service, resulting in disruptions to their operations. For

example, a DDS official in one state told us that at the time of our

discussion, she had been waiting for approximately 2 weeks for the IWS/LAN

contractor to repair a hard disk drive in one of the office’s workstations.

In January 1998, the National Council of Disability Determination

Directors (NCDDD), which represents the state DDSs, wrote to SSA to express

the collective concerns of the DDSs regarding SSA’s plan to manage and

control their IWS/LAN networks. NCDDD recommended that SSA pilot the

IWS/LAN equipment in one or more DDS office to evaluate options for

allowing the states more flexibility in managing their networks. It further

proposed that IWS/LAN installations be delayed for states whose operations

would be adversely affected by the loss of network control. At least one

state DDS—Florida—refused to continue with the roll-out of IWS/LAN in its

offices until this issue is resolved. Because IWS/LAN is expected to correct

Year 2000 deficiencies in some states’ hardware, however, NCDDD

cautioned that delaying the installation of IWS/LAN could affect the states’

progress in becoming Year 2000 compliant. At the conclusion of our

review, the Deputy Commissioner for Systems told us that SSA had begun

holding discussions with state officials in early March 1998 to identify

options for addressing the states’ concerns about the management of their

networks under the IWS/LAN environment.

SSA Will Not Measure

Benefits Derived

From IWS/LAN

Federal legislation and OMB directives require agencies to manage major

information technology acquisitions as investments. In implementing

IWS/LAN, SSA has followed a number of practices that are consistent with

these requirements, such as involving executive staff in the selection and

management of the initiative and assessing the cost, benefits, and risks of

the project to justify its acquisition. However, SSA’s practices have fallen

short of ensuring full and effective management of the investment in

IWS/LAN because it did not include plans for measuring the project’s actual

contributions to improved mission performance.

Page 10 GAO/AIMD-98-136 SSA Modernization
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Management Oversight and

Analysis Supported

IWS/LAN Implementation

According to the Clinger-Cohen Act and OMB guidance,16 effective

technology investment decision-making requires that processes be

implemented and data collected to ensure that (1) project proposals are

funded on the basis of management evaluations of costs, risks, and

expected benefits to mission performance and (2) once funded, projects

are controlled by examining costs, the development schedule, and actual

versus expected results. These goals are accomplished by considering

viable alternatives, preparing valid cost-benefit analyses, and having senior

management consistently make data-driven decisions on major projects.

SSA followed an established process for acquiring IWS/LAN that met a

number of these requirements. For example, senior management reviewed

and approved the project’s acquisition and has regularly monitored the

progress of the initiative against competing priorities, projected costs,

schedules, and resource availability.

SSA also conducted a cost-benefit analysis to justify its implementation of

IWS/LAN. This analysis was based on comparisons of the time required to

perform certain work tasks before and after the installation of IWS/LAN

equipment in 10 SSA offices selected for a pilot study during January

through June 1992. For example, the pilot tested the time savings

attributed to SSA employees not having to walk from their desks or wait in

line to use a shared personal computer. Based on the before and after time

savings identified for each work task, SSA projected annual savings from

IWS/LAN of 2,160 workyears that could be used to process growing

workloads and improve service. In a review of the IWS/LAN initiative in 1994,

the Office of Technology Assessment (OTA)17 found SSA’s cost-benefit

analysis to be sufficient for justifying the acquisition of IWS/LAN.

SSA Is Not Using Key

Performance Measures to

Assess the Impact of

IWS/LAN on Mission

Performance

Although SSA followed certain essential practices for acquiring IWS/LAN, it

has not yet implemented performance goals and measures to assess the

impact of this investment on productivity and mission performance. Under

the Clinger-Cohen Act, agencies are to establish performance measures to

gauge how well their information technology supports program efforts and

better link their information technology plans and usage to program

missions and goals. Successful organizations rely heavily upon

16OMB Circular A-11 requires that planned information technology acquisitions be based on a

cost-benefit analysis. Similarly, OMB Circular A-94 requires that decisions to initiate government

projects be based on an analysis of expected life-cycle costs and benefits, and that alternative means

of achieving program objectives be considered.

17The Social Security Administration’s Decentralized Computer Strategy: Issues and Options

(OTA-TCT-592, April 1994).

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performance measures to operationalize mission goals and objectives,

quantify problems, evaluate alternatives, allocate resources, track

progress, and learn from mistakes.18 Performance measures also help

organizations determine whether their information systems projects are

really making a difference, and whether that difference is worth the cost.

The Clinger-Cohen Act also requires that large information technology

projects be implemented incrementally and that each phase should be cost

effective and provide mission-related benefits. It further requires that

performance measures be established for each phase to determine

whether expected benefits were actually achieved.

In our September 1994 report,19 we noted that as part of an effort with the

General Services Administration (GSA) to develop a “yardstick” to measure

the benefits that IWS/LAN will provide the public,20 SSA had initiated actions

aimed at identifying cost and performance goals for IWS/LAN. SSA identified

six categories of performance measures that could be used to determine

the impact of IWS/LAN technology on service delivery goals and

reengineering efforts.21 It had planned to establish target productivity

gains for each measure upon award of the IWS/LAN contract. GSA was to

then use these measures to assess IWS/LAN’s success.

As of March 1998, however, SSA had established neither the target goals to

help link the performance measures to the agency’s strategic objectives

nor a process for using the measures to assess IWS/LAN’s impact on agency

productivity and mission performance. In addition, although the

Clinger-Cohen Act and OMB guidance22 state that agencies should perform

retrospective evaluations after completing an information technology

project, SSA officials told us that they do not plan to conduct a

post-implementation review of the IWS/LAN project once it is fully

18Executive Guide: Improving Mission Performance Through Strategic Information Management and

Technology (GAO/AIMD-94-115, May 1994).

19GAO/AIMD-94-143, September 19, 1994.

20This effort resulted from the National Performance Review, which required agencies to include

performance measures on all information technology purchases of $100 million or more.

21These measures were (1) productivity benefits of baseline automation with IWS/LAN in the state

DDSs (a computation of the DDS productivity gain by comparing pre-IWS/LAN baseline data with

post-IWS/LAN implementation data), (2) SSA baseline automation savings generated by the

implementation of IWS/LAN in SSA and Office of Hearing and Appeal field office components,

(3) improvements in payment and service delivery accuracy resulting from use of the 800 Number

Expert System and dial-in remote access via IWS/LAN, (4) number of IWS/LANs installed per month as

compared to the IWS/LAN implementation schedule, (5) existing terminal redeployment and phase-out,

and (6) contract cost and pricing.

22OMB Circular A-130, Section 8b(1).

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implemented. According to the Director of the Information Technology

Systems Review Staff,23 SSA currently does not plan to use any of the

measures to assess the project’s impact on agency productivity and

mission performance because (1) the measures had been developed to

fulfill a specific GSA procurement requirement that no longer exists and

(2) it believes the results of the pilots conducted in 1992 sufficiently

demonstrated the savings that will be achieved with each IWS/LAN

installation.

It is essential that SSA follow through with the implementation of a

performance measurement process for each phase of the IWS/LAN effort.

Measuring performance is necessary to show how this investment is

contributing to the agency’s goal of improving productivity. Among leading

organizations that we have observed, managers use performance

information to continuously improve organizational processes, identify

performance gaps, and set improvement goals.24 The performance

problems that SSA has already encountered in piloting software on IWS/LAN

make it even more critical for SSA to implement performance measures and

conduct post-implementation reviews for each phase of this initiative.

SSA believes that the results of its pilot effort undertaken in 1992 to justify

the acquisition of IWS/LAN sufficiently demonstrate that it will achieve its

estimated workyear savings. However, the pilot results are not an

acceptable substitute for determining the actual contribution of IWS/LAN to

improved productivity. In particular, although the pilots assessed task

savings for specific functions performed in each office, they did not

demonstrate IWS/LAN’s actual contribution to improved services gained

through improvements in the accuracy of processing or improvements in

processing times. In addition, OTA noted in its 1994 review25 that the

relatively small number of pilots may not have adequately tested all the

potential problems that could arise when the equipment is deployed at all

of SSA’s sites.

23The Information Technology Systems Review Staff, within the Office of Finance, Assessment, and

Management, performs independent reviews of proposed information technology projects for the

Chief Information Officer. Its oversight objectives include ensuring that initiatives (1) are

appropriately prioritized, priced, and timed, and are supportable and affordable, and (2) progress

within the approved cost and schedule and result in systems that meet mission needs and provide

anticipated benefits.

24Executive Guide: Effectively Implementing the Government Performance and Results Act

(GAO/GGD-96-118, June 1996).

25OTA-TCT-592, April 1994.

Page 13 GAO/AIMD-98-136 SSA Modernization
B-279868 

Further, information gained from post-implementation reviews is critical

for improving how the organization selects, manages, and uses its

investment resources. Without a post-implementation review of each

phase of the IWS/LAN project, SSA cannot validate projected savings, identify

needed changes in systems development practices, and ascertain the

overall effectiveness of each phase of this project in serving the public.

Post-implementation reviews also serve as the basis for improving

management practices and avoiding past mistakes.

Conclusions SSA is relying on IWS/LAN to play a vital role in efforts to modernize its work

processes and improve service delivery, and it has made good progress in

implementing workstations and LANs that are a part of this effort.

However, equipment availability and capability issues, problems in

developing software that is to operate on the IWS/LAN workstations, and

concerns among state DDSs that their equipment will not be adequately

managed and serviced by SSA, threaten the continued progress and success

of this initiative. Moreover, absent target goals and a defined process for

measuring performance, SSA will not be able to determine whether its

investment in each phase of IWS/LAN is yielding expected improvements in

service to the public.

Recommendations To strengthen SSA’s management of its IWS/LAN investment, we recommend

that the Commissioner of Social Security direct the Deputy Commissioner

for Systems to

• immediately assess the adequacy of workstations specified in the IWS/LAN

contract, and based on this assessment, determine (1) the number and

capacity of workstations required to support the IWS/LAN initiative and

(2) its impact on the IWS/LAN implementation schedule;

• work closely with state DDSs to promptly identify and resolve network

management concerns and establish a strategy for ensuring the

compliance of those states relying on IWS/LAN hardware for Year 2000

corrections;

• establish a formal oversight process for measuring the actual performance

of each phase of IWS/LAN, including identifying the impact that each IWS/LAN

phase has on mission performance and conducting post-implementation

reviews of the IWS/LAN project once it is fully implemented.

Page 14 GAO/AIMD-98-136 SSA Modernization
B-279868 

Agency Comments

and Our Evaluation

In commenting on a draft of this report, SSA generally agreed with the

issues we identified and described actions that it is taking in response to

our recommendations to resolve them. These actions include

(1) determining remaining IWS/LAN workstation needs, (2) addressing state

DDS network management concerns and related Year 2000 compliance

issues, and (3) implementing a performance measurement strategy for the

IWS/LAN initiative. These actions are important to the continued progress

and success of the IWS/LAN initiative, and SSA must be diligent in ensuring

that they are fully implemented.

In responding to our first recommendation to assess the adequacy of

workstations specified in the IWS/LAN contract, SSA stated that it had

determined the number of workstations required to complete the IWS/LAN

implementation and was working on a procurement strategy and schedule

for this effort. SSA also stated that its current tests do not show a need for

workstations with a processing speed higher than 100 megahertz. The

agency further noted that terms and conditions in the IWS/LAN contract will

enable it to acquire a higher powered computer or other technology

upgrades when the need arises.

As discussed earlier in our report, it is important that SSA have the

necessary workstations to support its processing needs in the redesigned

work environment. Therefore, as SSA continues its aggressive pace in

implementing IWS/LAN, it should take all necessary steps to ensure that it

has fully considered its functional requirements over the life of these

workstations. Doing so is especially important since SSA has encountered

problems and delays in completing tests of the RDS software that are vital

to determining future IWS/LAN requirements.

Our second recommendation concerned SSA’s working closely with state

DDSs to identify and resolve network management concerns and establish a

strategy for ensuring the compliance of those states relying on IWS/LAN

hardware for Year 2000 corrections. SSA identified various actions, which if

successfully implemented, could help resolve DDS concerns regarding

network management and the maintenance of IWS/LAN equipment, and

facilitate its efforts in becoming Year 2000 compliant.

In responding to our final recommendation that it establish a formal

oversight process for measuring the actual performance of each phase of

IWS/LAN, SSA agreed that performance goals and measures should be

prescribed to determine how well information technology investments

support its programs and provide expected results. SSA stated that it is

Page 15 GAO/AIMD-98-136 SSA Modernization
B-279868 

determining whether expected benefits are being realized from IWS/LAN

installations through in-process and postimplementation assessments. SSA

further noted that its planning and budgeting process ensures that it

regularly assesses the impact of IWS/LAN on agency productivity and

mission performance.

However, during the course of our review, SSA could not provide specific

information to show how its planning and budgeting process and data on

workyear savings resulting from IWS/LAN installations were being used to

assess the project’s actual contributions to improved productivity and

mission performance. In addition, two of the three measures that SSA

identified in its response—the number of IWS/LANs installed per month and

existing terminal redeployment and phase-out—provide information that

is more useful for assessing the progress of SSA’s IWS/LAN installations and

existing terminal redeployment efforts.

To ensure that its investments are sound, it is crucial that SSA develop

measures to assess mission-related benefits, and use them in making

project decisions. We will continue to monitor SSA’s efforts in assessing the

benefits of IWS/LAN installations through its in-process and

postimplementation assessments and its planning and budgeting process.

We are sending copies of this report to the Commissioner of Social

Security; the Director of the Office of Management and Budget;

appropriate congressional committees; and other interested parties.

Copies will also be made available to others upon request.

Please contact me at (202) 512-6253 or by e-mail at

willemssenj.aimd@gao.gov if you have any questions concerning this

report. Major contributors to this report are listed in appendix II.

Sincerely yours,

Joel C. Willemssen

Director, Civil Agencies Information Systems

Page 16 GAO/AIMD-98-136 SSA Modernization
Page 17 GAO/AIMD-98-136 SSA Modernization
Contents

Letter 1

Appendix I 

Comments From the

Social Security

Administration

20

Appendix II 

Major Contributors to

This Report

25

Abbreviations

DDS Disability Determination Service

GAO General Accounting Office

GSA General Services Administration

IWS/LAN Intelligent Workstation/Local Area Network

LAN Local Area Network

NCDDD National Council of Disability Determination Directors

OMB Office of Management and Budget

OTA Office of Technology Assessment

RDS Reengineered Disability System

SSA Social Security Administration

Page 18 GAO/AIMD-98-136 SSA Modernization
Page 19 GAO/AIMD-98-136 SSA Modernization
Appendix I 

Comments From the Social Security

Administration

Page 20 GAO/AIMD-98-136 SSA Modernization
Appendix I 

Comments From the Social Security

Administration

Page 21 GAO/AIMD-98-136 SSA Modernization
Appendix I 

Comments From the Social Security

Administration

Page 22 GAO/AIMD-98-136 SSA Modernization
Appendix I 

Comments From the Social Security

Administration

Page 23 GAO/AIMD-98-136 SSA Modernization
Appendix I 

Comments From the Social Security

Administration

Page 24 GAO/AIMD-98-136 SSA Modernization
Appendix II 

Major Contributors to This Report

Accounting and

Information

Management Division,

Washington, D.C.

Valerie C. Melvin, Assistant Director

Michael A. Alexander, Senior Information Systems Analyst

Gwendolyn M. Adelekun, Senior Business Process Analyst

Atlanta Field Office Pamlutricia Greenleaf, Senior Evaluator

Kenneth A. Johnson, Senior Information Systems Analyst

(511249) Page 25 GAO/AIMD-98-136 SSA Modernization
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