Agencies progress on human resources LOB

Agencies have made progress in moving to standard human resources systems and processes, while the Office of Personnel Management continues to add more substance to the consolidation effort, the Office of Management and Budget said in a recent report to Congress.

When agencies are ready to upgrade or replace their HR information systems, they must compete those systems among public and private shared-services providers under the Human Resources Line of Business, OMB has directed.

“The HR LOB solution has significantly and permanently improved the delivery of federal HR services while addressing many pressing issues facing the federal government’s HR community,” OMB said in a report released the week of July 7. OMB said it submitted the report to the House and Senate Appropriations committees.

OMB highlighted advances it expects in the near term. In September, OPM, which manages the program, expects to have developed a concept of operations for separation management, according to the report. Recently, it provided a payroll benchmarking study and updated the HR LOB migration planning guidance for agencies and a technical model. In February, OPM established federal case studies as examples.

In June 2009, OMB anticipates development of the HR LOB certification framework to evaluate the capabilities of shared-service providers and a human resources benchmarking study to follow in September, the report said.

The HR LOB aims to drive standardization of systems, processes and business functions, which promise to cut costs and reduce risk. Contractors have typically operated agency HR systems, so OMB does not anticipate that it will affect federal employment levels, the report said, adding that the small number of federal information technology managers who supervised the contractors may be redirected to other IT projects.

For example, the Labor Department anticipates that its affected staff will support help desk and other customer service activities. At the Housing and Urban Development Department, 10 federal employees left through attrition after the agency migrated to Treasury’s shared-service center. HUD reported that it spent $989,000 to migrate to Treasury’s service in 2006, with an annual fee to Treasury of $1.6 million.

Labor replaced its legacy HR, payroll, and time and attendance systems with services from Interior’s National Business Center. Labor estimated total costs to move to NBC at $10.8 million for personnel and payroll systems. When Labor completes its migration in September 2009, it anticipates saving $2.3 million annually compared with its previous HR environment, the report said.

The Environmental Protection Agency reduced its annual costs of payroll processing for its 18,000 employees by about two-thirds to $3.2 million, or $90 per employee compared with $259 each previously.

Since the HR LOB will shift responsibility for human resources IT and payroll operations from agencies to consolidated services centers, OMB said it anticipates that agencies should benefit from reduced licensing costs, the retirement of legacy and redundant HR systems, reduced operations and maintenance costs and improved support for executive decision-making.

About the Author

Mary Mosquera is a reporter for Federal Computer Week.

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