Goodbye to a mountain of paperwork

The Office of Personnel Management wants to complete its Retirement Systems Modernization project before most baby boomers retire

The Office of Personnel Management says its $350 million Retirement Systems Modernization effort will guarantee federal employees a greater sense of certainty and security as they move into their retirement years. OPM’s justification for RSM is that new retirees counting on pension checks shouldn’t have to suffer long waits to be fully compensated for their years of government service, as often is the case now.

A congressional directive prompted OPM to overhaul its retirement systems after lawmakers kept hearing complaints that many newly retired feds were receiving only partial pension payments and waiting months for the rest. When completed, the new retirement applications will expedite pension checks and give all federal workers online tools they can use to plan for retirement, OPM officials say.

However, to modernize its retirement systems, the agency must first digitize a mind-boggling volume of paperwork on federal employees. With the help of contract employees, OPM has been digitizing employee records kept in more than 150,000 file drawers that take up acres of cabinet space in the agency’s Retirement Operations Center (ROC). The center is located inside a mountain in Boyers, Pa. OPM is also in the process of transferring electronic employee records into a new retirement benefits system.

“Sixty percent of the workforce will be eligible to retire in the next 10 years,” said Linda Springer, OPM’s director. “Even if you had the best manual processes in the world, our system would be overtaxed. We would be overwhelmed as this retirement wave rolled through. This is not just a ‘nice to have.’ It’s a ‘must have.’ ”
Although many corporations have undertaken projects to convert employee paper records, few such projects are as large as OPM’s, said Bob Danbeck, the agency’s associate director of human resources products and services.

 “Something on this scale is really rare,” he said. “Many companies may have a number of employees, but most of their careers will have been spent in that single company. In our case, people can go from agency to agency, and we must pull all of that data, which is a challenge.”

To keep RSM on track, OPM officials continually solicit congressional support for funding so that the project meets the deadline and “go live” dates. RSM is on schedule, officials say, and they expect to start transferring the first group of current employee records to the new system by February 2008.

“During this season of appropriations, it is important for us to continue to have a high degree of awareness of what we are doing,” Springer said. “Funding is critical. It is like putting gas in a race car that otherwise will run out.” OPM has requested $29 million for RSM in fiscal 2008.

OPM has allies in its cause. The agency receives help from groups that represent federal employees, including the National Active and Retired Federal Employees Association. “We see this as a big plus for federal workers,” said Dan Adcock, NARFE’s assistant legislative director. “The number of horror stories has gone up over the years. In some cases, we’ve seen people having to wait upwards of a year after retiring before their annuities are fully calculated. With technology as good as it is these days, there is no excuse for that.”

Scanning marathon

Although high-speed scanning and data storage technologies have matured to meet the demands of RSM, the volume of federal employee records and their location in various federal agencies make RSM a huge undertaking. Sometimes employees have worked in three or four agencies, and each of those agencies must perform some calculations for computing retirement benefits. “If only some of the agencies have gotten back to us with the information we need, that file is still not complete,” Springer said.

Another other complicating factor is the use of different payroll systems at various agencies. “All of that data becomes applicable at the time of a person’s retirement,” said Tom O’Keefe, RSM’s program director. “We are bringing this information together for the first time.”

Collecting massive amounts of paper and electronic files from many locations requires expert orchestration skills, said Craig LeClair, senior analyst at Forrester Research. In a large project with many moving parts, a critical factor will be OPM’s ability to stage transitions and avoid “big bang” cutovers often associated with failed projects, LeClair said. “It is critical to have a road map.”

OPM officials say they established development and transition plans for RSM and hired three contractors — Hewitt Associates, Accenture and Northrop Grumman’s Integic — to help the agency implement those plans.

On a tactical level, the logical place to begin was at the federal records facility in Pennsylvania, O’Keefe said. “We start at the ROC with employees that we have on file,” he said. “At this point, a fair percentage of the files have been moved from the agencies.” OPM is digitizing the paper records of about 8,000 employees each day.

Much of that scanning and conversion work is performed by Integic. “We are in the process of providing lists for contract personnel to go out and retrieve those files and prepare them for scanning in order to put these records in our database,”
O’Keefe said. Meanwhile, OPM employees are creating and applying rules for converting paper documents.

Although it is intensive, scanning is only part of OPM’s effort to modernize employee recordkeeping at its center for retirement operations. OPM also needs to transfer electronic files from various federal agencies, O’Keefe said.

Once scanning and labor-intensive hunts for scattered data are complete, OPM faces more work. “A large piece of this work is tied to the cleansing of the records,” Springer said. “Sometimes officials in different agencies have made notes in the margins of paper records or have not completely filled in all of the dates and other fields. There are a variety of things that must be done to make sure the records are accurate, and sometimes that slows the process.”

Another aspect of the modernization effort requires tracking the employee documents that are now entering the new system, said David Barley, chief technology officer at Casdex, a data storage company that has done similar work for companies such as Ford and Cisco Systems. “Tagging and identification is a largely manual task and is reliant on human intervention,” Barley said. Organizing the data into meaningful structures is also crucial, he added.

Scanning, conversion and data centralization are major components of RSM. However, the most significant value of the program will be the retirement information it will give federal employees and retirement benefits officers. Those services, which OPM refers to as its Defined Benefit Technology Solution (DBTS), are the centerpiece of RSM.

DBTS is a mainframe application. “Internally, DBTS has a number of Web tools and terminal services for personnel workers that help manage federal retirement services,” O’Keefe said.

The agency developed DBTS with Hewitt Associates, which won a $290 million contract to provide the agency with Hewitt’s Total Benefits Administration software. The company uses that software to manage pension administration for hundreds of companies. DBTS will help employees deal with the challenges of planning for retirement. Accenture won a separate contract to help OPM on workforce transformation issues.

“We get a lot of ‘What if’ questions from individuals trying to plan for retirement,” Danbeck said. When OPM finishes modernizing the federal government’s retirement systems, federal employees can get quick answers to such questions, he said. And for those newly retired from government service, RSM will help them answer the question, “Where is my pension check?”

McAdams is a freelance writer based in Vienna, Va.
OPM on a path to self serviceWorkforce experts say online retirement planning tools could benefit federal employees, many of whom fail to prepare properly for the years that follow their government service. Those tools will be available to all federal employees when the Office of Personnel Management completes its Retirement Systems Modernization (RSM) project.

“Like all Americans, federal employees need a lot of personal finance education on how to prepare for retirement,” said Dan Adcock, assistant legislative director for the National Active and Retired Federal Employees Association. Planning for retirement can be especially challenging for federal employees, he said. They must calculate how the three sources of income that make up federal retirement benefits — annuity payments, Thrift Savings Plan (TSP) investments and Social Security benefits — will come together when they leave government service.

Employees might want to model what their retirement benefits will look like in 10 years. “They may want to know what will happen in the future if they boost a TSP contribution by two percent now,” said Tom O’Keefe, OPM’s RSM program director. Federal employees who constantly ask OPM officials and human resources officers “What if” questions could benefit from RSM’s online projections, he said. 

To make such benefits calculations, OPM devised a set of business rules, which it issued to agencies in January.

— Jennifer McAdams
Milestones and ‘go live’ datesThe Office of Personnel Management is building and testing new retirement systems. In February 2008, the agency will transfer the first group of federal employees to the new systems. That group will include current employees and annuitants whose retirement benefits are administered by the General Services Administration.

After transferring that initial group of records, OPM plans to transfer employee files in this order:
  • Postal Service files by May 2008.
  • National Business Center files by August 2008.
  • National Finance Center files by November 2008.
  • Defense Department files by February 2009.
— Jennifer McAdams


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