Homeland Security's Fourth ERP Attempt FounderingHomeland Security's Fourth ERP Attempt Foundering

The Department of Homeland Security, which has three times failed at efforts to consolidate its financial systems, hasn't adequately planned its most recent effort, and DHS CIO Richard Spires hasn't been involved enough in the initiative, the agency's inspector general finds in a new report.

The estimated $450 million Transformation and Systems Consolidation, as the effort is known, aims to create an integrated financial, asset management and acquisition management system for the department. The project, which is pending a contract award, is one of 20 financial systems modernization efforts that’s been paused by the Office of Management and Budget pending review.

DHS has already endured three previous financial systems modernization failures over its first 7 years. The first effort was canceled due to technical failures, the second failed after zero contractors bid on the project, and the third after a federal judge found the agency in violation of contracting law.

The most recent effort, begun in May 2008, has suffered from different problems, according to the inspector general -- lack of planning and CIO involvement. That, the report concludes, could lead to increased costs and a lack of adherence to agency security and architecture standards, possibly threatening functionality.

Specifically, as of the date of the report, DHS didn't yet have necessary planning documents finished and approved, cost estimates were incomplete, and staff projects weren't finalized. The CIO's office, meanwhile, had had only limited oversight involvement in the project, which was being overseen by the agency's CFO, until last summer, and thereafter rated the program close to failing in its own independent analysis of the effort.

The effort is also rated poorly on the Office of Management and Budget's IT Dashboard, which tracks the performance of agency IT investments.

DHS has been plagued by siloes and consolidation challenges ever since it was cobbled together from 22 agencies in the aftermath of the 9/11 attacks. In a business case for Transformation and Systems Consolidation posted online, DHS notes that this complexity makes audits more difficult and financial data less accurate and timely and increases the agency's operational costs by inhibiting effective performance management.