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Sunday, February 25, 2007

OMB: Financial system consolidation already tested

In response to a report recommending that the Bush administration test the consolidation of agency financial management systems before making the moves permanent, the Office of Management and Budget released a statement arguing that the testing phase has already occurred.

The "pilot" or "proof of concept" for the financial management "line of business" took place over the past decade as seven large agencies and 79 smaller agencies moved to a government or commercial shared service center for hosting their core financial management systems, OMB stated.

According to OMB, the financial management line of business project, which is part of the President's Management Agenda, represents a continuation of these ongoing efforts to improve the cost, quality and performance of financial management systems.

A recent Congressional Research Service report by CRS analyst Garrett L. Hatch said the OMB effort to streamline financial management systems by moving them into shared service centers would stand a greater chance of success if tested using pilot projects. Hatch, who used to work in OMB's Office of Federal Financial Management, could not be reached for comment.

Karen Evans, OMB administrator of e-government and information technology, initially said in response to the suggestion that government pilot projects "never go away" and agencies should work testing, along with associated costs, into the initial implementation.

OMB also stated that the notion agency officials are fearful of investing funds into shared service center migrations because of the potential for failure is misguided, because the centers have all shown they are capable of performing well.

As for the concern raised by critics that transitions to shared service centers should not occur until potential risks are addressed, OMB said migration planning guidance urges agencies to consider the financial management line of business as part of their long-term planning process and take into account performance gaps, business case analysis and budget requests.

- Daniel Pulliam, GovExec.com

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