Business Modernization:

NASA Must Consider Agencywide Needs to Reap the Full Benefits of Its Enterprise Management System Modernization Effort

GAO-07-691: Published: Jul 20, 2007. Publicly Released: Aug 20, 2007.

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Since 1990, GAO has designated the National Aeronautics and Space Administration's (NASA) contract management as an area of high risk in part because it lacked modern systems to provide accurate and reliable information on contract spending. In April 2000, NASA began a system modernization effort, known as the Integrated Enterprise Management Program (IEMP). When GAO last reported on the status of IEMP in September 2005, NASA had begun to implement disciplined processes needed to manage IEMP, but had yet to implement other best practices such as adopting business processes that improve information on contract spending. This GAO report addresses (1) actions taken by NASA to effectively implement the disciplined processes needed to manage IEMP and (2) the extent to which NASA has considered the strategic issues associated with developing a concept of operations and defining standard business processes. GAO interviewed NASA officials and obtained and analyzed documentation relevant to the issues.

Since GAO last reported on NASA's IEMP efforts, NASA implemented its IEMP contract management module and upgraded the software used for its core financial module. NASA has also taken steps to improve its processes for managing IEMP--including implementing improved requirements management and testing processes, enhancing its performance metrics related to tracking system defects, and developing an IEMP risk mitigation strategy. Further, NASA has developed quantitative entry and exit criteria for moving from one phase of an IEMP project to another--a recognized industry best practice. However, NASA has not yet addressed weaknesses in the areas of requirements development and project scheduling, which ultimately caused the agency to assume a greater risk that it would not identify significant system defects prior to implementation of the core financial upgrade. Despite these difficulties, NASA financial managers have stated that the core financial upgrade is now functioning as expected for most transactions. As of the end of GAO's audit work in May 2007, NASA was working to correct a number of system errors, including posting errors for certain types of transactions. Because NASA was still working to stabilize the system, GAO was unable to determine the significance of these weaknesses. Further, NASA has not yet fully considered higher-level strategic issues associated with developing an agencywide concept of operations and defining standard business processes. With a planned investment of over $800 million for IEMP, NASA must immediately and effectively address these strategic building blocks if IEMP is to successfully address long-standing management challenges--including overseeing contractor performance and properly accounting for NASA's property, plant, and equipment. NASA officials stated that they have begun developing a concept of operations to describe how all of its business processes should be carried out. According to NASA officials, they expect to complete the concept of operations by the summer of 2008. Ideally, a concept of operations should be completed before system development begins so that it can serve as a foundation for system planning and requirements development. Nonetheless, while NASA's IEMP efforts are already well under way, the completion of such a document remains essential for guiding the development of the remaining IEMP modules as well as any future upgrades. As part of developing a concept of operations, NASA should also define standard business processes that are supported by its IEMP software. NASA needs to ensure that its business processes and the information that flows from those processes support the enterprise's needs. Efforts that primarily focus on the parochial needs of a specific organizational unit, such as accounting, do not provide reasonable assurance that NASA's agencywide management information needs are addressed.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: Once the concept of operations is complete, the NASA Administrator should review the functionality of previously implemented IEMP modules for the purpose of determining whether enhancements or modifications are needed to bring them into compliance with the concept of operations.

    Agency Affected: National Aeronautics and Space Administration

    Status: Closed - Implemented

    Comments: In September 2007, NASA established the Management/Business Systems Integration Group (M/BSIG), which provides for annual reviews of business systems gaps and prioritizing resolution of those gaps from an agencywide perspective to ensure that it is using its limited resources on the highest priority items. As part of this process, NASA was to review the functionality of previously implemented Integrated Enterprise Management Program (IEMP) modules to determine whether enhancements and/or modifications are necessary to bring them into compliance with the concept of operations. For example, in 2009, one of NASA's components identified a gap regarding the lack of an agency emergency notification system. NASA prioritized and ranked this gap as one of its top three needs, and therefore, authorized funding to enhance the IEMP functionality to include this feature.

    Recommendation: To help ensure that future IEMP projects are designed to carry out NASA's mission in an efficient manner that meets the needs of all users, the NASA Administrator should establish as a high priority the completion of a concept of operations that addresses NASA's business operations for both its mission offices and administrative offices (such as financial management and human capital) before any new implementation efforts begin.

    Agency Affected: National Aeronautics and Space Administration

    Status: Closed - Implemented

    Comments: In October 2008, NASA finalized a concept of operations for its business systems, which describes key elements as defined by the IEEE standards, such as major system components and interfaces to external systems, and provides the foundation to support strategic, operational, and design decisions regarding agencywide business system investments. In addition, NASA's concept of operations addresses both mission and mission support needs for business services, such as finance, human capital, procurement, etc. A concept of operations should help ensure that future IEMP projects are designed to carry out NASA's mission in an efficient manner that meets the needs of all users.

    Recommendation: To help ensure that disciplined processes are effectively implemented for future IEMP modules, upgrades, or other business systems, the NASA Administrator should direct the IEMP Program Director to develop policies and procedures that require project schedules to include the identification and documentation of dependencies among various project tasks.

    Agency Affected: National Aeronautics and Space Administration

    Status: Closed - Implemented

    Comments: In February 2010, NASA established scheduling requirements in its NASA Procedural Requirements (NPR) 7120.5, NASA Space Flight Program and Project Management Requirements and, in March 2011, provided guidance in its Schedule Management Handbook for administering and satisfying the scheduling requirements set forth in NPR 7120.5. Based on these documents, NASA's recommended approach to managing project schedules includes developing an integrated master schedule using inter-project linking capabilities in the scheduling software tool to identify, document, and logically connect the dependencies among all project work elements. Further, as part of its Agile scrum development process, NASA continuously assesses resource requirements, including the identification and documentation of dependencies among project tasks, and build such requirements into project schedules.

    Recommendation: To help ensure that disciplined processes are effectively implemented for future IEMP modules, upgrades, or other business systems, the NASA Administrator should direct the IEMP Program Director to establish requirements development policies and procedures regarding (1) how customer needs will be elicited, developed, and validated; (2) how to identify and ensure the involvement of relevant stakeholders; and (3) required training in such topics as requirements definition and analysis to be provided to people involved in the requirements process.

    Agency Affected: National Aeronautics and Space Administration

    Status: Closed - Implemented

    Comments: In September 2007, NASA established the Management/Business Systems Integration Group (M/BSIG), which is comprised of representatives from key organizations associated with and affected by NASA's business systems, to assess business systems gaps, prioritize business system requirements, and make recommendations to senior management based on an agencywide integrated perspective. In December 2007, NASA developed and issued its Needs and Requirements Identification Framework to provide guidance for eliciting and refining business system gaps, needs and high level requirements and to define the process for prioritizing agencywide business system investment decisions. In addition, NASA implemented an Agile scrum development process, which allows for formal stakeholder review and feedback at the end of each development iteration, as well as training on Agile development methodology and requirements management.

    Recommendation: To help ensure that NASA receives the maximum benefit from its reported $800 million investment in IEMP, the NASA Administrator should establish policies and procedures requiring approval to establish or maintain business processes that are inconsistent with the processes inherent in the commercial off-the-shelf (COTS) solutions selected for IEMP. The reasons for any decisions made to not implement the inherent COTS processes should be well-documented and approved by the Administrator or his designee. At a minimum, approved documentation should address any decisions to maintain current contractor cost reporting processes rather than revise these processes to facilitate the use of one consistent source of cost data.

    Agency Affected: National Aeronautics and Space Administration

    Status: Closed - Implemented

    Comments: According to NASA officials, all new system implementations and major upgrades/modifications require a business case to evaluate feasible alternatives for meeting identified requirements. Business cases are reviewed by the Management/Business Systems Integration Group (M/BSIG) and the IT Strategy and Investment Board (SIB) prior to submission to senior leadership for approval. In addition, NASA has formed a team to develop new policies and processes for contractor cost reporting. Further, this system has been in place for several years and NASA has recently received clean financial statement audit opinions. Based on the cumulative actions taken, we believe that NASA has addressed the intent of our recommendation.

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