Homeland Security: Weak Oversight of Human Resources Information Technology Investment Needs Considerable Improvement
Published: 2016-02-25T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: DHS's human resources information technology environment includes fragmented systems, duplicative and paper-based processes, and little uniformity of data management practices, which according to DHS, are compromising the department's ability to effectively carry out its mission. DHS initiated HRIT in 2003 to consolidate, integrate, and modernize DHS's human resources information technology infrastructure. In 2011, DHS redefined HRIT's scope and implementation time frames.
This statement summarizes GAO's report that is being released at today's hearing (GAO-16-253) on, among other objectives, the progress DHS has made in implementing the HRIT investment and how effectively it managed the investment.
section_title: What GAO Found
paragraphs: The Department of Homeland Security (DHS) has made very little progress in implementing its Human Resources Information Technology (HRIT) investment over the last several years. This investment includes 15 improvement areas; as of November 2015, DHS had fully implemented only 1.
HRIT's limited progress was due in part to the lack of involvement of its executive steering committee—the investment's core oversight and advisory body. Specifically, this committee was minimally involved with HRIT, such as meeting only once during a nearly 2-year period when major problems were occurring, including schedule delays and the lack of a life-cycle cost estimate. As a result, key governance activities, such as approval of HRIT's operational plan, were not completed. Officials acknowledge that HRIT should be re-evaluated. They have met to discuss it; however, specific actions and time frames have not yet been determined. Until DHS takes key actions to manage this neglected investment, it is unknown when its human capital management weaknesses will be addressed.
section_title: What GAO Recommends
paragraphs: In its report that is being released today, GAO made 14 recommendations to DHS to, among other things, address HRIT's poor progress and ineffective management. For example, GAO recommended that the HRIT executive steering committee be consistently involved in overseeing and advising the investment, and that DHS establish time frames for re-evaluating HRIT and develop a complete life-cycle cost estimate for the investment. DHS concurred with the 14 recommendations and provided estimated completion dates for implementing each of them.

section_title: Letter
paragraphs: I am pleased to be here today to discuss the Department of Homeland  Security’s (DHS) efforts to implement the Human Resources Information  Technology (HRIT) investment. Since DHS was created in 2002 and  merged 22 agencies into one department with eight components, its  human resources environment has included fragmented systems,  duplicative and paper-based processes, and little uniformity of data  management practices. According to DHS, these limitations in its human  resources environment are compromising the department’s ability to  effectively and efficiently carry out its mission. To address these issues,  DHS initiated HRIT in 2003 to consolidate, integrate, and modernize the  department’s information technology (IT) infrastructure that supports  human resources.
The information in my testimony is based on our report being released at  today’s hearing on the results of our review of DHS’s implementation of  HRIT. Specifically, my remarks today summarize key findings from that  study, which (1) evaluated the progress DHS has made in implementing  the HRIT investment and how effectively DHS managed the investment,  (2) determined whether the Performance and Learning Management  System (PALMS)—HRIT’s only ongoing program—is being implemented  enterprise-wide, and (3) evaluated the extent to which PALMS is  implementing selected IT acquisition best practices.
For our report, we, among other things, compared HRIT’s goals, scope,  and implementation time frames to the investment’s actual  accomplishments. Additionally, we analyzed HRIT and PALMS  documentation, such as program management briefings, the PALMS  acquisition plan, and cost and schedule estimates, and compared them  against relevant IT acquisition best practices identified by GAO, the  Software Engineering Institute at Carnegie Mellon University, and the  Project Management Institute, Inc. More details on the objectives, scope,  and methodology are provided in the report. The work on which this  statement is based was conducted in accordance with generally accepted  government auditing standards.
subsections: section_title: Background
paragraphs: According to DHS, the limitations in its human resources environment,  which includes fragmented systems and duplicative and paper-based  processes, were compromising the department’s ability to effectively and  efficiently carry out its mission. For example, according to DHS, the  department does not have information on all of its employees, which  reduces its abilities to strategically manage its workforce and best deploy  people in support of homeland security missions. Additionally, according  to DHS, reporting and analyzing enterprise human capital data are  currently time-consuming, labor-intensive, and challenging because the  department’s data management largely consists of disconnected,  standalone systems, with multiple data sources for the same content.
To address these issues, in 2003, DHS initiated the HRIT investment,  which is intended to consolidate, integrate, and modernize the  department’s and its components’ human resources IT infrastructure.  These components include U.S. Customs and Border Protection, the  Federal Emergency Management Agency, the Federal Law Enforcement  Training Center, U.S. Immigration and Customs Enforcement, the  Transportation Security Administration, U.S. Citizenship and Immigration  Services, the U.S. Coast Guard, and the U.S. Secret Service.
HRIT is managed by DHS’s Human Capital Business Systems unit, which  is within the Office of the Chief Human Capital Officer and has overall  responsibility for HRIT. Additionally, the Office of the Chief Information  Officer plays a key supporting role in the implementation of HRIT by  reviewing headquarters’ and components’ human resources investments,  identifying redundancies and efficiencies, and delivering and maintaining  enterprise IT systems.
From 2003 to 2010, DHS made limited progress on the HRIT investment,  as reported by DHS’s Inspector General. This was due to, among other  things, limited coordination with and commitment from DHS’s  components. To address this problem, in 2010 the DHS Deputy Secretary  issued a memorandum emphasizing that DHS’s wide variety of human  resources processes and IT systems inhibited the ability to unify DHS and  negatively impacted operating costs. Accordingly, the Deputy Secretary  memorandum prohibited component spending on enhancements to  existing human resources systems or acquisitions of new solutions,  unless those expenditures were approved by the Offices of the Chief  Human Capital Officer or Chief Information Officer. The memorandum  also directed these offices to develop a department-wide human  resources architecture.
In 2011, in response to the Deputy Secretary’s direction, the department  developed a strategic planning document referred to as the Human  Capital Segment Architecture blueprint, which redefined the HRIT  investment’s scope and implementation time frames. As part of this effort,  DHS conducted a system inventory and determined that it had 422  human resources systems and applications, many of which were single- use solutions developed to respond to a small need or links to enable  disparate systems to work together. DHS reported that these numerous,  antiquated, and fragmented systems inhibited its ability to perform basic  workforce management functions necessary to support mission critical  programs.
To address this issue, the blueprint articulated that HRIT would be  comprised of 15 strategic improvement opportunity areas (e.g., enabling  seamless, efficient, and transparent end-to-end hiring) and outlined 77  associated projects (e.g., deploying a department-wide hiring system) to  implement these 15 opportunities.
HRIT’s only ongoing program is called PALMS and is intended to fully  address the Performance Management strategic improvement opportunity  area and its three associated projects. PALMS is attempting to implement  a commercial off-the-shelf software product that is to be provided as a  service in order to enable, among other things, comprehensive  enterprise-wide tracking, reporting, and analysis of employee learning  and performance for DHS headquarters and its eight components.  Specifically, PALMS is expected to deliver the following capabilities:
Learning management. The learning management capabilities are  intended to manage the life cycle of learning activities for all DHS  employees and contractors. It is intended to, among other things, act  as a gateway for accessing training at DHS and record training  information when a user has completed a course. Additionally, it is  expected to replace nine disparate learning management systems  with one unified system.
Performance management. The performance management  capabilities are intended to move DHS’s existing primarily paper- based performance management processes into an electronic  environment and capture performance-related information throughout  the performance cycle (e.g., recording performance expectations  discussed at the beginning of the rating period and performance  ratings at the end of it).
Each component is responsible for its own PALMS implementation  project, and is expected to issue a task order using a blanket purchase  agreement that was established in May 2013 with an estimated value of  $95 million. The headquarters PALMS program management office is  responsible for overseeing the implementation projects across the  department. Additionally, the Office of the Chief Information Officer is the  Component Acquisition Executive responsible for overseeing PALMS.
In addition, according to DHS officials, as of September 2014, PALMS  was expected to address part of our High Risk Series on strengthening  DHS’s management functions. Specifically, PALMS is intended to  address challenges in integrating employee training management across  all the components, including centralizing training and consolidating  training data into one system.
section_title: DHS Has Made Very Little Progress in Implementing HRIT; Investment Lacked Effective Management
paragraphs: DHS has made very limited progress in addressing the 15 strategic  improvement opportunities and the 77 associated projects included in  HRIT. According to the Human Capital Segment Architecture Blueprint,  DHS planned to implement 14 of the 15 strategic improvement  opportunities and 68 of the 77 associated projects by June 2015; and the  remaining improvement opportunity and 9 associated projects by  December 2016. However, as of November 2015, DHS had fully  implemented only 1 of the strategic improvement opportunities, which  included 2 associated projects. Table 1 summarizes the implementation  status and planned completion dates of the strategic improvement  opportunities—listed in the order of DHS’s assigned priority—as of  November 2015.
DHS has partially implemented five of the other strategic improvement  opportunities, but it is unknown when they will be fully addressed. Further,  HRIT officials stated that DHS has not yet started to work on the  remaining nine improvement opportunities, and the officials did not know  when they would be addressed.
Additionally, DHS developed an HRIT strategic plan for fiscal years 2012  through 2016 that outlined the investment’s key goals and objectives,  including reducing duplication and improving efficiencies in the  department’s human resources processes and systems. The strategic  plan identified, among other things, two performance metrics that were  focused on reductions in the number of component-specific human  resources IT services provided and increases in the number of  department-wide HRIT services provided by the end of fiscal year 2016.
However, DHS has also made limited progress in achieving these two  performance targets. Figure 1 provides a summary of HRIT’s progress  towards achieving its service delivery performance targets.
Key causes for DHS’s lack of progress in implementing HRIT and its  associated strategic improvement opportunities include unplanned  resource changes and the lack of involvement of the HRIT executive  steering committee. These causes are discussed in detail below:
Unplanned resource changes. DHS elected to dedicate the vast  majority of HRIT’s resources to implementing PALMS and addressing  its problems, rather than initiating additional HRIT strategic  improvement opportunities. Specifically, PALMS—which began in July  2012—experienced programmatic and technical challenges that led to  years-long schedule delays. For example, while the PALMS system  for headquarters was originally planned to be delivered by a vendor in  December 2013, as of November 2015, the expected delivery date  was delayed until the end of February 2016—an over 2-year delay.  HRIT officials explained the decision to focus primarily on PALMS was  due, in part, to the investment’s declining funding. However, in doing  so, attention was concentrated on the immediate issues affecting  PALMS and diverted from the longer-term HRIT mission.
Lack of involvement of the HRIT executive steering committee. The  HRIT executive steering committee—which is chaired by the  department’s Under Secretary for Management and co-chaired by the  Chief Information Officer and Chief Human Capital Officer—is  intended to be the core oversight and advisory body for all DHS-wide  matters related to human capital IT investments, expenditures,  projects, and initiatives. In addition, according to the committee’s  charter, the committee is to approve and provide guidance on the  department’s mission, vision, and strategies for the HRIT program.
However, the executive steering committee only met once from  September 2013 through June 2015—in July 2014—and was  minimally involved with HRIT for that almost 2 year period. It is  important to note that DHS replaced its Chief Information Officer (the  executive steering committee’s co-chair) in December 2013—during  this gap in oversight. Also during this time period HRIT’s only ongoing  program—PALMS—was experiencing significant problems, including  schedule slippages and frequent turnover in its program manager  position (i.e., PALMS had five different program managers during the  time that the HRIT executive steering committee was minimally  involved). As a result of the executive steering committee not meeting,  key governance activities were not completed on HRIT. For example,  the committee did not approve HRIT’s notional operational plan for  fiscal years 2014 through 2019. Officials from the Offices of the  Chief Human Capital Officer and Chief Information Officer attributed  the lack of HRIT executive steering committee meetings and  committee involvement in HRIT to the investment’s focus being only  on the PALMS program to address its issues, as discussed earlier.  However, by not regularly meeting and providing oversight during a  time when a new co-chair for the executive steering committee  assumed responsibility and PALMS was experiencing such problems,  the committee’s guidance to the troubled program was limited.
More recently, the HRIT executive steering committee met in June  and October 2015, and officials from the Offices of the Chief Human  Capital Officer and Chief Information Officer stated that the committee  planned to meet quarterly going forward. However, while the  committee’s charter specified that it meet on at least a monthly basis  for the first year, the charter does not specify the frequency of  meetings following that year. Furthermore, the committee’s charter  has not been updated to reflect the increased frequency of these  meetings.
As a result of the limited progress in implementing HRIT, DHS is unaware  of when critical weaknesses in the department’s human capital  environment will be addressed, which is, among other things, impacting  DHS’s ability to carry out its mission. For example, the end-to-end hiring  strategic improvement opportunity (which has an unknown  implementation date) was intended to streamline numerous systems and  multiple hand-offs in order to more efficiently and effectively hire  appropriately skilled personnel, thus enabling a quicker response to  emergencies, catastrophic events, and threats.
We recommended in our report that DHS’s Under Secretary for  Management update the HRIT executive steering committee charter to  establish the frequency with which the committee meetings are to be  held, and ensure that the committee is consistently involved in overseeing  and advising HRIT. DHS agreed with both of these recommendations and  stated that the executive steering committee charter would be updated  accordingly by the end of February 2016; and that by April 30, 2016, the  Under Secretary plans to ensure that the committee is consistently  involved in overseeing and advising HRIT.
subsections: section_title: HRIT Lacked a Current Schedule, Life-Cycle Cost Estimate, and Cost Tracking
paragraphs: According to the GAO Schedule Assessment Guide, a key activity in  effectively managing a program and ensuring progress is establishing and  maintaining a schedule estimate. Specifically, a well maintained schedule  enables programs to gauge progress, identify and resolve potential  problems, and forecast dates for program activities and completion of the  program.
In August 2011, DHS established initiation and completion dates for each  of the 15 strategic improvement opportunities within the Human Capital  Segment Architecture Blueprint. Additionally, HRIT developed a slightly  more detailed schedule for fiscal years 2014 through 2021 that updated  planned completion dates for aspects of some strategic improvement  opportunities, but not all.
However, DHS did not update and maintain either schedule after they  were developed. Specifically, neither schedule was updated to reflect that  DHS did not implement 13 of the 15 improvement opportunities by their  planned completion dates—several of which should have been  implemented over 3 years ago. HRIT officials attributed the lack of  schedule updates to the investment’s focus shifting to the PALMS  program when it started experiencing significant schedule delays. Without  developing and maintaining a current schedule showing when DHS plans  to implement the strategic improvement opportunities, DHS and Congress  will be limited in their ability to oversee and ensure DHS’s progress in  implementing HRIT.
We recommended that the department update and maintain a schedule  estimate for when DHS plans to implement each of the strategic  improvement opportunities. In response, DHS concurred with our  recommendation and stated that, by April 30, 2016, the DHS Chief  Information Officer will update and maintain a schedule estimate for each  of the strategic improvement opportunities.
subsections: section_title: HRIT Did Not Have a Life- Cycle Cost Estimate
paragraphs: The Office of Management and Budget (OMB) requires that agencies  prepare total estimated life-cycle costs for IT investments. Program  management best practices also stress that key activities in planning and  managing a program include establishing a life-cycle cost estimate and  tracking costs expended. A life-cycle cost estimate supports budgetary  decisions and key decision points, and should include all costs for  planning, procurement, and operations and maintenance of a program.
Officials from the Office of the Chief Human Capital Officer stated that a  draft life-cycle cost estimate for HRIT was developed, but that it was not  completed or finalized because detailed projects plans for the associated  projects had not been developed or approved. According to the Human  Capital Segment Architecture blueprint, the Office of the Chief Human  Capital Officer roughly estimated that implementing all of the projects  could cost up to $120 million. However, the blueprint specified that this  figure did not represent the life-cycle cost estimate; rather it was intended  to be a preliminary estimate to initiate projects. Without a life-cycle cost  estimate, DHS has limited information about how much it will cost to  implement HRIT, which hinders the department’s ability to, among other  things, make budgetary decisions and informed milestone review  decisions.
Accordingly, we recommended that DHS develop a complete life-cycle  cost estimate for the implementation of the HRIT investment. DHS agreed  with our recommendation and stated that, by June 30, 2016, the DHS  Chief Information Officer will direct development of a complete life-cycle  cost estimate for the implementation of HRIT’s strategic improvement  opportunities.
section_title: DHS Did Not Track All Costs Incurred on HRIT
paragraphs: According to CMMI-ACQ and the PMBOK® Guide, programs should track  program costs in order to effectively manage the program and make  resource adjustments accordingly. In particular, tracking and monitoring  costs enables a program to recognize variances from the plan in order to  take corrective action and minimize risk.
However, DHS has not tracked the total actual costs incurred on  implementing HRIT across the enterprise to date. Specifically, while the  investment received line item appropriations for fiscal years 2005 through  2015 which totaled at least $180 million, DHS was unable to provide all  cost information on HRIT activities since it began in 2003, including all  government-related activities and component costs that were financed  through the working capital fund, which, according to DHS officials from  multiple offices, were provided separately from the at least $180 million  appropriated specifically to HRIT. Officials from the Office of the Chief  Human Capital Officer attributed the lack of cost tracking to, among other  things, the investment’s early reliance on contractors to track costs, and  said that the costs were not well maintained nor centrally tracked, and  included incomplete component-provided cost information. The  components were also unable to provide us with complete information.
Consequently, we recommended that the department document and track  all costs, including components’ costs, associated with HRIT. DHS  concurred and stated that, by October 31, 2016, the DHS Chief  Information Officer will direct the HRIT investment to document and track  all costs associated with HRIT.
section_title: HRIT’s 2011 Blueprint May Not Be Valid and Reflective of DHS’s Current Priorities and Goals
paragraphs: According to the HRIT executive steering committee’s charter, the Under  Secretary for Management (as the chair of the committee) is to ensure  that the department’s human resources IT business needs are met, as  outlined in the blueprint. Additionally, according to the GPRA  (Government Performance and Results Act) Modernization Act of 2010,  agency strategic plans should be updated at least every 4 years. While  this is a legal requirement for agency strategic plans (the Human Capital  Segment Architecture blueprint does not fall under the category of an  “agency strategic plan”), it is considered a best practice for other strategic  planning documents, such as the blueprint.
However, the department issued the blueprint in August 2011  (approximately 4.5 years ago) and has not updated it since. As a result,  the department does not know whether the remaining 14 strategic  improvement opportunities and associated projects that it has not fully  implemented are still valid and reflective of DHS’s current priorities, and  are appropriately prioritized based on current mission and business  needs. Additionally, DHS does not know whether new or emerging  opportunities or business needs need to be addressed.
Officials stated that the department is still committed to implementing the  blueprint, but agreed that it should be re-evaluated. To this end, following  a meeting we had with DHS’s Under Secretary for Management in  October 2015, in which we expressed concern about HRIT’s lack of  progress, officials from the Offices of the Chief Human Capital Officer and  Chief Information Officer stated that HRIT was asked by the Deputy  Under Secretary for Management in late October 2015 to re-evaluate the  blueprint’s strategic improvement opportunities and to determine the way  forward for those improvement opportunities and the HRIT investment.  However, officials did not know when this re-evaluation and a  determination for how to move forward with HRIT would occur, or be  completed.
Further, according to officials from the Office of the Chief Information  Officer, DHS has not updated its complete systems inventory since it was  originally developed as part of the blueprint effort, in response to a 2010  Office of Inspector General report that stated that DHS had not identified  all human resource systems at the components. This report also  emphasized that without an accurate inventory of human resource  systems, DHS cannot determine whether components are using  redundant systems. Moreover, the officials from the Office of the Chief  Information Officer were unable to identify whether and how its inventory  of human resources systems had changed.
Until DHS establishes time frames for re-evaluating the blueprint to reflect  DHS’s HRIT current priorities and updates its human resources system  inventory, the department will be limited in addressing the inefficient  human resources environment that has plagued the department since it  was first created. As a result, we recommended that DHS establish time  frames for re-evaluating the strategic improvement opportunities and  associated projects in the blueprint and determining how to move forward  with HRIT; evaluate the opportunities and projects to determine whether  the goals of the blueprint are still valid and update the blueprint  accordingly; and update and maintain the system inventory. DHS agreed  with these recommendations and expects to address them by February  2016, April 2016, and October 2016, respectively.
section_title: Selected PALMS Capabilities Have Been Deployed to Headquarters and Two Components; but Full Implementation at Four Components Is Not Currently Planned
paragraphs: As previously mentioned, PALMS is intended to provide an enterprise- wide system that offers performance management capabilities, as well as  learning management capabilities to headquarters and each of its  components. As such, DHS’s headquarters PALMS program  management office and the components estimate that, if fully  implemented across DHS, PALMS’s learning management capabilities  would be used by approximately 309,360 users, and its performance  management capabilities would be used by at least 217,758 users.
However, there is uncertainty about whether the PALMS system will be  used enterprise-wide to accomplish these goals. Specifically, as of  November 2015, of the eight components and headquarters, five are  planning to implement both PALMS’s learning and performance  management capabilities (three of which have already implemented the  learning management capabilities—discussed later), two are planning to  implement only the learning management capabilities, and two  components are not currently planning to implement either of these  PALMS capabilities, as illustrated in figure 2.
Officials from the Federal Emergency Management Agency, U.S.  Immigration and Customs Enforcement, the Transportation Security  Administration, and the U.S. Coast Guard cited various reasons for why  their components were not currently planning to fully implement PALMS,  which include:
Federal Emergency Management Agency and U.S. Immigration and  Customs Enforcement officials stated that they were not currently  planning to implement the performance management capabilities  because the program had experienced critical deficiencies in meeting  the performance management-related requirements. Federal  Emergency Management Agency officials stated that they do not plan  to make a decision on whether they will or will not implement these  performance management capabilities until the vendor can  demonstrate that the system meets the Agency’s needs; as such,  these officials were unable to specify a date for when they plan to  make that decision. U.S. Immigration and Customs Enforcement  officials also stated that they do not plan to implement the  performance management capabilities of PALMS until the vendor can  demonstrate that all requirements have been met. PALMS  headquarters officials expected all requirements to be met by the  vendor by the end of February 2016.
Transportation Security Administration officials stated that they were  waiting on the results of their fit-gap assessment of PALMS before  determining whether, from a cost and technical perspective, the  Administration could commit to implementing the learning and  performance management capabilities of PALMS. Administration  officials expected the fit-gap assessment to be completed by the end  of March 2016.
U.S. Coast Guard officials stated that, based on the PALMS schedule  delays experienced to date, they have little confidence that the  PALMS vendor could meet the component’s unique business  requirements prior to the 2018 expiration of the vendor’s blanket  purchase agreement. Additionally, these officials stated that the  system would not meet all of the Coast Guard’s learning management  requirements, and likely would not fully meet the performance  management requirements for all of its military components. Due to  the component’s uncertainty, the officials were unable to specify when  they plan to ultimately decide on whether they will implement one or  both aspects of PALMS.
As a result, it is unlikely that the department will meet its goal of being an  enterprise-wide system. Specifically, as of November 2015, the  components estimate 179,360 users will use the learning management  capabilities of PALMS (not the 309,360 expected, if fully implemented),  and 123,200 users will use the performance management capabilities of  PALMS (not the 217,758 expected, if fully implemented).
Of the seven components and headquarters that are currently planning to  implement the learning and/or performance management aspects of  PALMS, as of December 2015, three have completed their  implementation efforts of the learning management capabilities and  deployed these capabilities to users (deployed to U.S. Customs and  Border Protection in July 2015, headquarters in October 2015, and the  Federal Law Enforcement Training Center in December 2015); two have  initiated their implementation efforts on one or both aspects, but not  completed them; and two have not yet initiated any implementation  efforts.
As a result, PALMS’s current trajectory is putting the department at risk of  not meeting its goals to perform efficient, accurate, and comprehensive  tracking and reporting of training and performance management data  across the enterprise; and consolidating its nine learning management  systems down to one. Accordingly, until the Federal Emergency  Management Agency decides whether it will implement the performance  management capabilities of PALMS and the Coast Guard decides  whether it will implement the learning and/or performance management  capabilities of PALMS, the department is at risk of implementing a  solution that does not fully address its problems. Moreover, until DHS  determines an alternative approach if one or both aspects of PALMS is  deemed not feasible for U.S. Immigration and Customs Enforcement, the  Transportation Security Administration, the Federal Emergency  Management Agency, or the Coast Guard, the department is at risk of not  meeting its goal to enable enterprise-wide tracking and reporting of  employee learning and performance management.
We recommended that the department establish a time frame for deciding  whether PALMS will be fully deployed at the Federal Emergency  Management Agency and the Coast Guard, and determine an alternative  approach if the learning and/or performance management capabilities of  PALMS are deemed not feasible for the Federal Emergency Management  Agency, U.S. Immigration and Customs Enforcement, the Transportation  Security Administration, or the Coast Guard. DHS concurred with our  recommendation and stated that the PALMS program office will establish  a time frame for a deployment decision of PALMS for these components.
section_title: PALMS Program Had Made Mixed Progress in Implementing Key IT Acquisition Best Practices
paragraphs: According to GAO’s Cost Estimating and Assessment Guide, having a  complete life-cycle cost estimate is a critical element in the budgeting  process that helps decision makers to evaluate resource requirements at  milestones and other important decision points. Additionally, a  comprehensive cost estimate should include both government and  contractor costs of the program over its full life cycle, from inception of the  program through design, development, deployment, and operation and  maintenance to retirement of the program.
However, according to PALMS program management office officials, they  did not develop a life-cycle cost estimate for PALMS. In 2012, DHS  developed an independent government cost estimate to determine the  contractor-related costs to implement the PALMS system across the  department (estimated to be approximately $95 million); however, this  estimate was not comprehensive because it did not include government- related costs. PALMS program office officials stated that PALMS did not  develop a life-cycle cost estimate because the program is a Level 3  acquisition program and DHS does not require such an estimate for a  Level 3 program. However, while DHS acquisition policy does not require  a life-cycle cost estimate for a program of this size, we maintain that such  an estimate should be prepared because of the program’s risk and  troubled history. Without developing a comprehensive life-cycle cost  estimate, DHS is limited in making future budget decisions related to  PALMS.
Accordingly, we recommended that the department develop a  comprehensive life-cycle cost estimate, including all government and  contractor costs, for the PALMS program. DHS concurred with our  recommendation and stated that, by May 30, 2016, the PALMS program  office will update the program’s cost estimate to include all government  and contractor costs.
subsections: section_title: PALMS’s Schedule Was Incomplete and Inaccurate
paragraphs: As described in GAO’s Schedule Assessment Guide, a program’s  integrated master schedule is a comprehensive plan of all government  and contractor work that must be performed to successfully complete the  program. Additionally, such a schedule helps manage program schedule  dependencies. Best practices for developing and maintaining this  schedule include, among other things, capturing all activities needed to  do the work and reviewing the schedule after each update to ensure the  schedule is complete and accurate.
While DHS had developed an integrated master schedule with the  PALMS vendor, it did not appropriately maintain this schedule.  Specifically, the program’s schedule was incomplete and inaccurate. For  example, while DHS’s original August 2012 schedule planned to fully  deploy both the learning and performance management capabilities in  one release at each component by March 2015, the program’s  September 2015 schedule did not reflect the significant change in  PALMS’s deployment strategy and time frames. Specifically, the program  now plans to deploy the learning management capabilities first and the  performance management capabilities separately and incrementally to  headquarters and the components. However, the September 2015  schedule reflected the deployment-related milestones (per component)  for only the learning management capabilities and did not include the  deployment-related milestones for the performance management  capabilities.
In September 2015, PALMS officials stated that the deployments related  to performance management were not reflected in the program’s  schedule because the components had not yet determined when they  would deploy these capabilities. Since then two components have  determined their planned dates for deploying these capabilities, but seven  (including headquarters) remain unknown. As a result, the program does  not know when PALMS will be fully implemented at all components with  all capabilities.
Moreover, the schedule did not include all government-specific activities,  including tasks for employee union activities (such as notifying employee  unions and bargaining with them, where necessary) related to the  proposed implementation of the performance management capabilities.
Without developing and maintaining a single comprehensive schedule  that fully integrates all government and contractor activities, and includes  all planned deployment milestones related to performance management,  DHS is limited in monitoring and overseeing the implementation of  PALMS, and managing the dependencies between program tasks and  milestones to ensure that it delivers capabilities when expected.  Consequently, we recommended that DHS develop and maintain a single  comprehensive schedule. DHS agreed and stated that, by May 30, 2016,  the PALMS program office will develop and maintain a single,  comprehensive schedule that includes all government and contractor  activities, and all planned milestones related to deploying the PALMS  system’s performance management capabilities.
section_title: The PALMS Program Management Office Did Not Monitor Total Costs
paragraphs: According to CMMI-ACQ and the PMBOK® Guide, a key activity for  tracking a program’s performance is monitoring the project’s costs by  comparing actual costs to the cost estimate. The PALMS program  management office—which is responsible for overseeing the PALMS  implementation projects across DHS, including all of its components— monitored task order expenditures on a monthly basis. As of December  2015, DHS officials reported that they had issued approximately $18  million in task orders to the vendor.
However, the program management office officials stated that they were  not monitoring the government-related costs associated with each of the  PALMS implementations. The officials stated that they were not tracking  government-related implementation costs at headquarters because many  of the headquarters program officials concurrently work on other  acquisition projects and these officials are not required to track the  amount of time spent working specifically on PALMS. The officials also  said that they were not monitoring the government-related costs for each  of the component PALMS implementation projects because it would be  difficult to obtain and verify the cost data provided by the components.  We acknowledge the department’s difficulties associated with obtaining  and verifying component cost data; however, monitoring the program’s  costs is essential to keeping costs on track and alerting management of  potential cost overruns. As such, we recommended that DHS track and  monitor all costs associated with the PALMS program. DHS concurred  with our recommendation and stated that it plans to have the PALMS  program office track and monitor all costs associated with the PALMS  program by March 30, 2016.
In summary, although the HRIT investment was initiated about 12 years  ago with the intent to consolidate, integrate, and modernize the  department’s human resources IT infrastructure, DHS has made very  limited progress in achieving these goals. HRIT’s minimally involved  executive steering committee during a time when significant problems  were occurring was a key factor in the lack of progress. Moreover, DHS’s  lack of use of program management best practices for HRIT and PALMS  also contributed to the neglect this investment has experienced.  Implementing our recommendations is critical to the department  addressing its fragmented and duplicative human resources environment  that is hindering the department’s ability to efficiently and effectively  perform its mission.
Chairman Perry, Ranking Member Watson Coleman, and Members of the  Subcommittee, this concludes my prepared statement. I would be  pleased to respond to any questions that you may have.
section_title: Contact and Acknowledgments
paragraphs: If you have any questions concerning this statement, please contact Carol  Cha, Director, Information Technology Acquisition Management Issues, at  (202) 512-4456 or chac@gao.gov. Other individuals who made key  contributions include Rebecca Gambler, Director; Shannin O’Neill,  Assistant Director; Christopher Businsky; Rebecca Eyler; Javier Irizarry;  Emily Kuhn; and David Lysy.
This is a work of the U.S. government and is not subject to copyright protection in the  United States. The published product may be reproduced and distributed in its entirety  without further permission from GAO. However, because this work may contain  copyrighted images or other material, permission from the copyright holder may be  necessary if you wish to reproduce this material separately.