AID wasted $70 million on systems, IG reports

The AID IG's report said the agency wasted the money trying to design and deploy the
New Management System. NMS has created more problems than it has solved since being
deployed Oct. 1, said the report signed by IG Everette B. Orr.


The main problems are managerial not technical, the IG concluded. "To a large
extent, this problem exists due to underlying organizational and management deficiencies
that allow substandard IRM practices to continue despite high risks of adverse
consequences," the report said.


Among five recommendations, the IG report called for the appointment of a chief
information officer responsible only for AID systems. "The CIO does not have IRM as
the primary responsibility, as defined by the Office of Management and Budget, because he
is also responsible for several other major management organizations including
procurement, personnel and financial management," the report said.


The report also suggested that AID assign one senior manager as NMS overseer and
another to develop and manage performance-based acquisitions, suspend further NMS contract
work until the agency has a new implementation plan and stop work on an accounting module
until it fixes technical deficiencies.


But the CIO said the IG report contains erroneous spending data, overstates the
problems with NMS and misses the mark on systems management practices.


"I think the IG does not understand modern computer technology and what everyone
is doing," said Larry Byrne, assistant administrator for management and the agency's
CIO. "I don't believe CIOs in the government can operate the way in which the IG
suggests."


As to the IG's recommendation that AID replace him with a systems expert, Byrne said,
"OMB qualified me for the job and agreed with us that it is reasonable for us to look
at this a different way, that there should be some flexibility."


AID officials planned NMS to replace several disparate information systems at AID
offices around the world. NMS consolidates accounting, budgeting, procurement, operations,
property, human resources, guidance and communications applications. For NMS, AID
converted older systems to an Oracle Corp. relational database management system running
on an IBM RS/6000 servers. End users access the application modules via networked 486 PCs.


The March 31 report, Audit of the Worldwide Deployment of the New Management System,
said only half of NMS' subsystems have been developed and deployed. Further, the IG report
said that none of the subsystems is fully operational.


Orr's report said agency officials did not respond to a draft copy.


"They gave us only 48 hours to respond," Byrne said. "They had the
administrator's response in their hand by the time they issued this report."


Even so, he said the IT staff wants to meet with the IG and has begun implementing some
of the management recommendations. The administrator's office is reviewing the NMS
strategy and will issue a response on June 1.


"We've been trying to get the IG people to come in and work with us," Byrne
said. "We've made that offer several times."


As to system problems, the IG report charged that NMS has software and design glitches.
Between last Oct. 1 and Jan. 29, about 1,000 software defects were reported, 373 of which
were categorized as critical and serious because they prevented transaction processing,
the report said.


He acknowledged that NMS does need work. "Are there software pieces that are not
working as well as you would like? Yes. Every time you change the software specifications,
you run into problems. It's an integrated system. But is it worse than some of the other
systems going up? No."


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