Information Technology:

U.S. Postal Service Needs to Strengthen System Acquisition and Management Capabilities to Improve Its Intelligent Mail Full Service Program

GAO-10-145: Published: Oct 29, 2009. Publicly Released: Nov 30, 2009.

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In 2003, the United States Postal Service (USPS) initiated the Intelligent Mail program, which is intended to use information-rich standardized barcodes to track mail and thus provide USPS and mailers with better and timely information. A major component of this program is the Full Service program, which, among other things, is intended to build a system that improves the visibility into end-to-end mail processing operations through the use of new barcodes, and create efficiencies by streamlining and automating certain aspects of the process. GAO was asked to determine (1) the current status and plans for the Intelligent Mail Full Service program and (2) if the Postal Service has capabilities in place to successfully acquire and manage the Intelligent Mail Full Service program. GAO obtained and analyzed USPS documentation, reviewed previous GAO reports, interviewed officials, and compared acquisition best practices with USPS's practices.

Program officials have completed key activities for implementing the Intelligent Mail Full Service program, such as deploying the first phase of the program; however, the current schedule for the program has been delayed by almost 10 months. As a result, the second phase of the program is not expected to be implemented until the end of November 2009. In addition, key functions of the program that were originally intended to be delivered have been deferred. Moreover, the life-cycle cost that program officials prepared does not capture all the costs associated with the acquisition and implementation of the program. As a result, program officials lack an accurate total cost estimate. Finally, the first deployed phase is currently experiencing operational problems. While the Full Service program has taken steps to implement acquisition management activities, it does not have the full set of capabilities it needs to fully manage the acquisition. A key cause of the program's acquisition management weaknesses in the areas of project planning, risk management, and product integration is that USPS organizational policies do not set forth sufficient requirements for establishing effective practices in these areas. Weaknesses exist in the program monitoring and control area because the program management contract creates a conflict of interest by requiring that the contractor assess the quality of its own deliverables and oversee the program's schedule, issues, and risks. Without these management capabilities in place, USPS increases the risk that this program will continue to encounter problems in meeting its performance, schedule, and cost objectives.

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: USPS Full Service program officials have not implemented this recommendation. Specifically, officials did not update the life-cycle cost estimate for the Full Service program, which as we reported in 2010, was an incomplete cost estimate. Specifically, the estimate excluded key costs associated with the acquisition and implementation of the Full Service program, such as costs related to the integration of the systems and the cost of future releases beyond the second release.

    Recommendation: To ensure that the United States Postal Service (USPS) adequately manages the acquisition of the Intelligent Mail Full Service program, the Postmaster General should direct the Chief Information Officer and Senior Vice President of Intelligent Mail and Address Quality to develop a comprehensive cost estimate to include both government and contractor costs over the program's full life cycle, from the inception of the program through design, development, deployment, and operation and maintenance to retirement.

    Agency Affected: United States Postal Service

  2. Status: Closed - Not Implemented

    Comments: USPS program officials have not implemented this recommendation. Specifically, according to USPS officials, the Intelligent Mail Vision Statement, July 2009 Version 2, was intended to serve as the guiding document for the program. However, this vision statement is a strategy document and does not serve as an overall program plan for the entire Full Service program. Additionally, while USPS officials stated that the USPS retired one barcode in January 2013, and another barcode will be retired soon, officials were unable to provide a plan for retiring the remaining barcodes.

    Recommendation: To ensure that the USPS adequately manages the acquisition of the Intelligent Mail Full Service program, the Postmaster General should direct the Chief Information Officer and Senior Vice President of Intelligent Mail and Address Quality toto comnplete an overall program plan for the entire Full Service program, including an overview of the program's scope of all releases, deliverables and functionality within these releases, plans to phase out the approximately 30 barcodes currently being utilized, assumptions and constraints, roles and responsibilities, staffing and training plans, and the strategy for maintaining the plan.

    Agency Affected: United States Postal Service

  3. Status: Closed - Implemented

    Comments: In July 2011, the Intelligent Mail Full Service program management office contract was transitioned to a different contractor than the one that is responsible for the system development work. A condition of the program management office contract is that the new vendor cannot bid on any IT development work. As a result, the contractor developing the system is no longer evaluating its own performance.

    Recommendation: To ensure that the USPS adequately manages the acquisition of the Intelligent Mail Full Service program, the Postmaster General should direct the Chief Information Officer and Senior Vice President of Intelligent Mail and Address Quality to reconsider the current contract arrangement to avoid having the contractor evaluate its own performance.

    Agency Affected: United States Postal Service

  4. Status: Closed - Not Implemented

    Comments: USPS Full Service program officials have not implemented this recommendation. Specifically, officials did not update its defined set of core requirements to include the entire program. In August 2014, officials stated that as new products and services continue to evolve, funding requests to support related IT system enhancements are requested following their budget funding request process.

    Recommendation: To ensure that the USPS adequately manages the acquisition of the Intelligent Mail Full Service program, the Postmaster General should direct the Chief Information Officer and Senior Vice President of Intelligent Mail and Address Quality to define the core set of requirements for the entire program and use them as a basis for developing a reliable cost estimate.

    Agency Affected: United States Postal Service

  5. Status: Closed - Implemented

    Comments: In response to our recommendation, a risk management process was established to identify and track risks. Specifically, in August 2010, program officials created a risk log that allowed for identifying and tracking risks, mitigating actions, and designating a priority level on a daily basis. As a result, program risks were better identified and mitigated.

    Recommendation: To ensure that the USPS adequately manages the acquisition of the Intelligent Mail Full Service program, the Postmaster General should direct the Chief Information Officer and Senior Vice President of Intelligent Mail and Address Quality to develop a risk management process that enables the program officials to develop an adequate risk management plan that fully addresses the scope of their risk management efforts; ensures that a comprehensive list of risks and complete mitigation plans are identified and tracked; and includes milestones, mitigating actions, thresholds, and resources for significant risks.

    Agency Affected: United States Postal Service

  6. Status: Closed - Implemented

    Comments: In response to our recommendation, USPS program officials developed an integrated project plan that set forth key milestones and implementation steps for integrating all systems, sub-systems, external systems and any components with the Full Service system.

    Recommendation: To ensure that the USPS adequately manages the acquisition of the Intelligent Mail Full Service program, the Postmaster General should direct the Chief Information Officer and Senior Vice President of Intelligent Mail and Address Quality to develop and maintain a systems integration plan for release 2 and beyond.

    Agency Affected: United States Postal Service

  7. Status: Closed - Implemented

    Comments: In response to our recommendation, the Technical Solution Life Cycle (TSLC) policy and guidance was updated in April 2014, to establish improved organizational practices in the areas of program planning, risk management, and product integration. The TSLC now articulates processes and artifacts necessary for program planning. Further, risk management processes have been designated as part of the certification and accreditation process, and system integration plans are tracked by the Chief Information Officer. As a result, acquisition management processes within USPS have been strengthened.

    Recommendation: The Postmaster General should direct USPS's Chief Information Officer to include in USPS's Technical Solution Life Cycle policy guidance for programs to develop (1) complete program plans that define overall budget and schedule, key deliverables and milestones, assumptions and constraints, description and assignment of roles and responsibilities, staffing and training plans, and an approach for maintaining these plans; (2) specific requirements for programs to establish a robust risk management process that identifies potential problems before they occur, such as requiring programs to develop a risk management plan; and (3) system integration plan that include all systems to be integrated with the system, roles and responsibilities for all relevant participants, the sequence and schedule for every integration step, and how integration problems are to be documented and resolved.

    Agency Affected: United States Postal Service

 

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