The Army Materiel Command initiated an effort in 1999 to replace its existing materiel management systems—the Commodity Command Standard System and the Standard Depot System—with LMP. In addition to replacing these systems, which have been used for over 30 years to manage inventory and depot maintenance operations, the Army intended for LMP to transform logistics operations in six core processes: order fulfillment, demand and supply planning, procurement, asset management, materiel maintenance, and financial management. According to the Army, the implementation of LMP is intended to help the Army reduce inventory, improve supply and demand forecast planning, and provide a single source of data for decision making. When LMP is fully implemented, it is expected to include approximately 21,000 users at 104 locations and will be used to manage more than $40 billion worth of goods and services. LMP became operational at the Army Communications-Electronics Command and Tobyhanna Army Depot in July 2003 and was originally expected to be fully deployed by fiscal year 2005. However, because of problems experienced during the deployment, the Army decided to delay implementation until the problems were resolved. In May 2009, LMP became operational at the Army Aviation and Missile Command and Corpus Christi and Letterkenny Army Depots. The third and final deployment of LMP began on October 1, 2010, at depots, arsenals, and sites within the Army Sustainment Command, the Joint Munitions and Lethality Life Cycle Management Command, and the Tank-automotive and Armaments Command. Preparations for the third and final deployment of LMP began in December 2008, and it is the largest of the three deployments, affecting approximately 11,000 users at 83 sites across the globe. LMP program management officials told us that 29 of these sites will significantly use LMP. The Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 indicates that the executive-level oversight of business systems modernization and overall business transformation—including defining and measuring success in enterprise resource planning—is the responsibility of a military department-level chief management officer. In the case of the Army, the Under Secretary of the Army serves as the Chief Management Officer. In this capacity, the Under Secretary of the Army provides oversight for business systems modernization, such as LMP. Prior to transitioning to LMP, the Army is directed to certify that each Army depot is prepared to transition. Specifically, in House Armed Services Committee Report 110-652 accompanying the Duncan Hunter National Defense Authorization Act for Fiscal Year 2009, the committee directed the Secretary of the Army to certify to the Senate Committee on Armed Services and the House Committee on Armed Services that each Army depot is prepared for the transition to LMP. On September 20, 2010, the Secretary of the Army certified to the chairmen and ranking members of the committees that the Tank-automotive and Armaments Command, the Joint Munitions and Lethality Life Cycle Management Command, their subordinate industrial sites, and the Army Sustainment Command were prepared for transition to the LMP automated information system. According to Army officials, based on the timing of this memorandum, the Army intended to begin using the system at the third deployment locations on October 21, 2010, to manage operations for fiscal year 2011. With the exception of this certification, the Army is not presently required to report to Congress other information specifically focused on LMP implementation on a regular basis. The Army has improved its LMP implementation strategy from the previous two deployments, but continues to face several problems that may prevent LMP from fully providing its intended functionality at each of the third deployment locations. While the Army has improved its data testing strategy for the third deployment, data quality problems continue to persist at locations that previously deployed LMP, which prevent these locations from using LMP as intended. Furthermore, the Army has yet to develop fully the software capabilities needed to achieve the intended LMP functionality for some sites, which may limit their ability to perform certain tasks, such as maintaining accountability of ammunition. Although the Army has mitigation plans in place if the software capabilities are not delivered on time or as intended, these mitigation plans will increase costs. Our prior reviews of LMP identified weaknesses in the Army’s efforts to effectively implement the processes needed to reduce risks to acceptable levels. During our current review, we found that the Army had taken action on some of these areas. For example, we previously recommended that the Army use system testers that are independent of the LMP system developers to help ensure that the system is providing its users the intended capabilities. Based on our observations of the third deployment, the Army implemented this recommendation and testing activities were being conducted by LMP users as opposed to the LMP system developers. Additionally, to assist in the preparation for the third deployment of LMP, we previously recommended that the Army establish performance metrics that will enable the Army to assess whether the deployment sites are able to use LMP as intended. The Army developed performance measures to monitor the progress of LMP implementation and finalized these measures on September 30, 2010. These measures, if effectively implemented, should enable the Army to determine the extent to which the third deployment sites are able to use LMP as intended. The Army does not have reasonable assurance that the data used by LMP are of sufficient quality to enable the commands, depots, and arsenals to perform their day-to-day missions using LMP as intended. The Army initiated a testing strategy to determine data accuracy, but it has not provided reasonable assurance that the data used by LMP can support the LMP processes. As we have previously reported, testing is a critical process utilized by organizations with the intent of finding errors before a system is implemented. Although the Army implemented new testing activities to support the third deployment of LMP, these activities were designed to assess whether the sites could use the software but did not evaluate whether the data loaded into LMP are of sufficient quality to support the LMP processes. LMP program management officials told us that these testing activities were not designed to assess data quality. Instead, the Army conducted data quality audits to determine whether select data elements were accurate. Based on our observations, the data quality audits did not effectively assess whether the data would work in the LMP system. Based on our observations during the second deployment of LMP, we previously recommended that the Army direct the Army Materiel Command to improve its testing activities to obtain reasonable assurance that the data are of a quality that can be used by LMP to support the LMP processes. The Army concurred with our recommendation and stated that the third deployment would involve improved testing as well as additional efforts to enhance the quality of the data. The Army implemented two new test activities—the Process and Data Integration Test and the Business Operations Test—for the third deployment of LMP. According to Army officials, these test activities incorporated some lessons learned from the second deployment of LMP. The Process and Data Integration Test, which was conducted from April 2010 through June 2010, was intended to test an end-to-end business process using migrated, validated business data from critical weapons systems. The Business Operations Test, which was conducted from July 2010 through September 2010, was intended to be an activity where users would perform transactions in the LMP system using local data, from their home stations, which would bring data, business processes, standard operating procedures, and end user training materials together to ensure success. LMP program management officials told us in January 2010 that these tests were an improvement over the tests used during the second deployment of LMP. Specifically, LMP program management officials stated that the Process and Data Integration Test was an improvement because the test activity would assess the compatibility of the migrated data to support LMP processes, such as verifying that invoices and goods receipts can be processed against purchase orders. Also, LMP program management officials stated that the Business Operations Test was an improvement because the sites would select commodities at their sites and then execute an end-to-end process to ensure that the LMP processes work. According to LMP program management officials, the two testing activities were linked because the test scripts used during the Process and Data Integration Test would be used to develop the test scripts for the Business Operations Test. LMP program management officials also told us in June 2010 that both tests would be used to determine whether the software is meeting the operational requirements of the third deployment locations, and that the Business Operations Test, in particular, would evaluate whether the data used by LMP can support the envisioned LMP processes. Based on our observations at the third deployment sites, the Army’s tests were not effective in evaluating whether the quality of the data used in LMP could support the LMP processes. Specifically, officials at several of the sites we visited stated that they had observed shortcomings in the Process and Data Integration Test. For example, officials at the Army Sustainment Command told us that at the time the Process and Data Integration Test activity was conducted, their data had yet to be loaded into LMP. Accordingly, these officials stated that the Process and Data Integration Test activity used data from the second deployment of LMP. Officials at sites from the Joint Munitions and Lethality Life Cycle Management Command also identified other problems with the Process and Data Integration Test activity, such as test scripts that were incorrect or not reflective of their business processes because the software necessary to support their operations was still being developed. Officials at a Tank-automotive and Armaments Command site expressed similar sentiments, noting that the test scripts used during the Process and Data Integration Test activity did not reflect some of their business processes, such as building items in support of foreign military sales. Similarly, officials at several other sites told us that the test scripts used were out of sequence, so the test scripts had to be corrected in order to reflect how the location conducted its business. We also observed challenges related to the Army’s Business Operations Test activity.