IRS to give CSC another chance

The Internal Revenue Service does not plan to fire the prime contractor from a modernization project plagued with problems -- yet. But officials say Computer Sciences Corp. could be removed from the project at some point if things don't improve.

An analysis of the IRS Business Systems Modernization program revealed a multitude of issues that have led to repeated cost overruns and missed deadlines. However, the agency shares some of the responsibility and will be part of the solution, said Todd Grams, the IRS' chief information officer.

The agency and the company developed a 46-point action plan, he said. "It includes actions that IRS is responsible for and actions that CSC is responsible for," he said.

The IRS will bring its business units into the planning process to ensure that new business systems under development meet the agency's needs, he said. The agency will also take responsibility for following methodologies that it and CSC have agreed to. In the past, the organizations sometimes ignored the methodologies in order to meet a deadline and, as a result, sacrificed quality of work.

The agency will also drop some individual projects from the modernization effort, he said. The number of large, midsize and small projects that agency personnel are responsible for has made it difficult for some people to give adequate attention to any one task.

The decisions are based on the nine recommendations that the independent IRS Oversight Board made in a report released this week, said Fred Forman, head of the IRS business systems modernization office. The board's analysis mirrored other assessments that agency officials had ordered, he said.

However, CSC is still on the hook. The company is at least partly at fault, Grams said, and IRS officials will continue to monitor its progress, especially on the Customer Account Data Engine (CADE) and the Integrated Financial Systems, major parts of the modernization effort.

"What we're going to do is monitor CSC's performance and progress on the major projects, and we'll end up making a determination based on that performance," he said. He declined to set a deadline by which the company must prove itself.

CSC officials have pledged to continue working on improving the company's performance and completing the modernization project for the IRS.


The IRS Oversight Board recommends:

1. IRS business units take direct leadership and ownership of the modernization program and its projects.

2. Creating an environment of trust, confidence and teamwork among the business units, the modernization project and CSC.

3. Enhancing the systems development life cycle methodology to support more accurate estimates of future work phases, and put in place processes to make sure the methodology is strictly followed.

4. Enhancing the program's contracting process and capabilities.

5. Adding more experience and capability to the modernization project team, which would require a significant number of outside hires.

6. Rationalizing oversight of the program to streamline the process and eliminate duplication.

7. Giving special attention to CADE, because it is the foundation of the modernization project and also the most costly, complex and longest running project in the modernization project portfolio.

8. Reducing the number of projects being conducted simultaneously. The modernization effort has five major projects under way, too many for IRS and CSC officials to manage at once.

9. Monitoring CSC's performance very closely. The board is not sure the company is able to provide the necessary leadership for the team.


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