IRS chiefs agree: Failure again is not an option

IRS chiefs agree: Failure again is not an option<@VM>Tax agency looks at alternatives for securing online transactions

Current team sees management issues as key to the success of latest systems modernization effort

By Shruti Dat'

GCN Staff

The IRS this month established the Business Systems Modernization Office to oversee its 15-year effort to overhaul its information technology infrastructure.

Director Bert M. Concklin reports to multiple oversight bodies vigilantly monitoring the $5 billion project. Congress, the General Accounting Office and the Treasury Department inspector general's tax administration branch all monitor each modernization step carefully and often make recommendations.

'At every stage, we will have an intimate relationship so IT and business do not drift.' 'Bert M. Concklin

'We did fail in the past,' IRS chief information officer Paul J. Cosgrave said. 'As a result of that, everyone is extremely cautious.'

Added Scott Wilson, Treasury's associate inspector general for audit of tax administration: 'Nobody wants a multibillion dollar failure. In the past, they bit off more than they could chew.'

A June IG report about the business systems modernization focused on the IRS' organizational structure, staffing, performance monitoring and risk management.

'We found that the oversight of the systems modernization effort has been hampered by the lack of a stable program management organization,' Pamela J. Gardiner, deputy inspector general for audit, wrote in a letter to IRS commissioner Charles O. Rossotti.

'In the IRS technical architecture we have systems layered on top of each other ' it's more than just changing a database.''Tommy G. DeWeese

'The key element now is they have [the BSM Office] up and running,' Wilson said.

The theme of the report, Significant Risks Need To Be Addressed to Ensure Adequate Oversight of the System Modernization Effort, was the need to establish a core management structure, Wilson said.

The IRS has not officially responded to the report. Wilson said, however, he is in constant contact with IRS officials about the modernization.

'They've taken it very seriously,' said Wilson, who said that he and Cosgrave touch base about once a month.

'We did fail in the past. As a result of that, everyone is extremely cautious.''Paul J. Cosgrave

'But whether [the office] will be effective remains to be seen,' he said.

Cosgrave said earlier attempts to modernize the IRS, such as the decade-long Tax Systems Modernization, failed because the service lacked both organization and a lifecycle plan and because the systems shop communicated inadequately with program managers.

The 117 members of the BSM Office will tackle these previously neglected areas, Concklin said. 'We will have clear output expectations,' he said. The staff understands the magnitude of the overhaul, he said.

'In the IRS technical architecture, we have so many systems layered on top of each other' that modernizing operations is 'more than just changing a database,' said Tommy G. DeWeese, the BSM Office's deputy director.

What's fueling IRS' systems

' 147 mainframe computers from 19

' 1,620 servers from 55 vendors

' 100,000 end-user computers

' 8,700 software products

' 82 million lines of code

' 1,182 LANs and four WANs

Jim Kennedy, program executive for Prime contractor Computer Sciences Corp., also emphasized the need to take careful steps. The IRS awarded CSC the 10-year Prime contract December 1998.

'Let's walk before we start running,' Kennedy said.

Concklin, who recently joined the IRS after 10 years at the Professional Services Council, said his staff will focus on acquiring IT assets that bolster the service's mission. 'So often, IT organizations leap into operations without consulting the business units,' he said.

The IRS slowed its modernization this spring so the service's four business units'which Rossetti created to mirror the groups of taxpayers the IRS serves'could provide the IT shop with input about the systems support that they need [GCN, Feb. 21, Page 3].

'We are engaged in a clear partnership,' Concklin said. 'At every stage, we will have an intimate relationship so IT and business do not drift.'

Concklin said his staff will use performance-based contracts with clear task orders and follow a disciplined enterprise lifecycle to meet the IRS' needs.

The IG will assess the processes and structure of the new office over the next few months, Wilson said. It plans to release another audit report in October that reviews the IRS' short-term plans for the modernization.The IRS is examining alternatives to public-key infrastructure technology to secure taxpayer transactions.

PKI applications might be the answer for tracking the delivery and receipt of e-mail between IRS caseworkers and taxpayers, but the IRS wants to explore all its options, chief information officer Paul J. Cosgrave said.

Another possibility would be to let taxpayers tap account information stored on a secure server, for example, he said.

The IRS also will review the Secure Sockets Layer encryption common to browsers and will investigate rigorous password controls for protecting information.

The tax service next year could initiate a pilot to test security methods, but no time frame has been set, Cosgrave said.

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