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Thursday, December 03, 2009

VA financial management system: FLITE delayed

The Veterans Affairs department has let the pilot program of a new asset management system slip by two months, just five months since the agency awarded the contract, according to a new report by the Government Accountability Office. GAO attributed the problems to inadequate staffing and poor program management.

In the report, GAO blamed General Dynamics, the contractor, for falling behind schedule.

The VA awarded the contract for the Strategic Asset Management system in April to General Dynamics in April. The system is one of two major components of VA's Financial and Logistics Integrated Technology Enterprise (FLITE), an effort to produce a department-wide integrated financial and asset management system. FLITE is one of the programs that the Office of Management and Budget has designated high risk.

The second component is the Integrated Financial Accounting System (IFAS). VA awarded a program management contract for IFAS to Booz-Allen Hamilton in March, and a pilot for that system is scheduled to begin in 2010.

The VA is the second largest federal agency, with 250,000 employees. The Veterans Health Administration operates 154 hospitals, 995 outpatient clinics, 135 community living centers, 49 residential rehab centers and 232 counseling centers. But it is plagued with inefficient and unstandardized business systems that require repeated manual entries, GAO said.

“VA has for over a decade been pursuing improvements in its business processes and replacement of its existing financial and asset management systems with an integrated financial management system,” GAO said.

The lack of an integrated financial management system has been recognized as a departmental weakness since 1991, and FLITE is the second attempt to provide one. Work on the earlier proposed Core Financial and Logistics System began in 1998 and was scheduled to be completed in 2006, but the agency dropped the program in 2004 when pilot projects revealed it would be unable to support the department’s needs.

Planning for FLITE began in 2005, with full operational implementation scheduled for 2014 at a cost of $608.7 million. As of September, the VA had spent about $91 million on the program.

The department picked the Maximo Enterprise Asset Management software suite from IBM as FLITE’s Strategic Asset Management (SAM) program, and General Dynamics IT was given the contract to implement at pilot in Milwaukee. By September, the contractor had not started 11 of 34 tasks, including a security assessment, and was behind schedule on 16 of the remaining 23 tasks, GAO said.

- William Jackson, GCN.com
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