How The Largest (Outsourced) HR IT Project Is Being Managed

You think you face an out of control project that defies management? Then let's look at how the federal government of the US works when it has new projects. Oftentimes the programs are under-resourced, leadership emphasis comes and goes, and you can count on a management "flavor of the month." Often you have multiple leaders, the White House, Congress and federal agencies, and everyone is trying to get a piece of the action. Many IT projects become mired in conflicting chiefs and a changing agenda. Many projects end up self-destructing.

So coordinating Enterprise Human Resources Integration, the massive computerization of human resources records of the federal government's Office of Personnel Management (OPM) and 214 federal agencies, served as a supreme challenge for the Center for Organizational Excellence (COE), a Rockville, Maryland management consulting company. "This would be the largest human resource system ever built. Wal-Mart is second. It will hold 1.8 million employee records and 30 years of history," said Steve Goodrich, president of COE. Further, it was one of the president's 24 eGovernment initiatives. That made it high-profile and put much — including reputations — at stake.

Its impact would reach across the entire government. "It's an HR system that impacts all federal agencies and employees. Data has to be exchanged with agencies and moved onto the desktop," Mr. Goodrich explained.

Working on the project with COE at the beginning, in June 2003, were five key partners: Idea Integration, an IT integrator responsible for developing and coding the software system; Integic Corp. (bought early in 2005 by Northrop-Grumman), to develop the electronic official personnel folders (EOPF in federal government lingo); AT&T, to develop the tools for federal agencies to analyze their workforces and perform forecasting; Lockheed-Martin; and Excella Consulting. One company is no longer part of the project. (More about that shortly.)

In this case study, Mr. Goodrich shares his advice for working on broad, ambitious outsourced projects that have multiple leaders, shifting priorities and a variable budget.

–>TIP #1: You have to set clear direction and establish decision-making, even when you know things will change.

As prime contractor for this OPM eHR project, COE was determined that this project was going to work and that the partners would operate on the same page. "We set a clear direction and focused on motivating the partners and controlling the project. It wasn't about making money," Mr. Goodrich said.

At one of the initial meetings with COE's partners, Mr. Goodrich told the assembled group, "This project was about helping the government doing the nation's business in an effective and efficient way." To make everything happen, COE's team of 45 staff performed financial, strategic and project planning, mapped out sequential deliverables and determined what expertise would be required.

"When you have a program of this size, things change often," said Mr. Goodrich. "You find out that you have a data source of this size and type, and when you get into it, you find out it's something completely different."

How do you cope? "It takes tremendous amounts of communication — not only among the team but with the client," he said.

–>TIP #2: Use some kind of project management framework.

To manage its projects, COE relies on Carnegie-Mellon's Capability Maturity Model (CMM) Level, said Lisa Gross, who served as COE's contractual program manager. This approach incorporates program control, earned value and subcontract management, risk, configuration and data management, quality assurance and analysis and reviews.

COE made sure that contractual agreements were explained to each partner and linked to any subcontracts. It also handled relationship management, involving steady communication with senior and mid-level managers. Last, it developed integrated and detailed work breakdown schedules.

COE maintains a detailed breakdown structure that tracks every single element — as Mr. Goodrich describes it, "It's a really long list."

Every minor element of the program is cataloged in a work breakdown structure and tracked on a daily basis using DOORS, a requirements management product by Telelogic.

Any instance of a delay is put into a weekly report that gets circulated to all the principals and addressed.

For each company involved in the work, COE issues task orders, which describes a discreet piece of work, what the vendor is to be paid, when it's due and what the deliverables are. COE maintains a management plan, which is referenced in the task orders and that defines the technical specifications and qualitative and quantitative requirements. The goal: to make everything "crystal clear."

In fact, one of the vendors listed above was terminated from the project. Mr. Goodrich won't say which vendor it was, though he describes it as "an extremely large, very well known company."

The termination came about over what Mr. Goodrich calls a "qualitative dispute." "It's not because the written definition was lacking," he explained. "The system didn't perform or couldn't be loaded onto the production server and [the vendor] took three extra months to do [the work.]." Worse, it didn't identify and raise the issues to COE, "like they should have…. They put the C team on this project, not the A team. It was very evident in the way they controlled, managed and delivered."

–>TIP #3: Proximity counts. Get people together physically and frequently to get the work done.

In order to ensure that communication among partners was constant, COE made one key strategic move: It housed everyone in the same building. Developers, programmers, architects and managers were all on one level. That included the other vendors as well. "We didn't allow them to go off into their own company and develop this and then bring it when it was done," said Mr. Goodrich.

The message was clear: We work as one team, and constant communication would be essential to keep every partner on the same page. After every meeting, minutes were published and circulated to each partner to document what had transpired. Despite every partner being located on site, emails and instant messaging were used "when the client was not at the development facility," Ms. Gross said.

Constant face-to-face meetings proved critical in keeping everyone on the same page.

"Physically, the client was 20 miles away, but they spent a lot of time on site with us. We spent a lot of time on site with them," said Mr. Goodrich. "We insist that everybody on their team is in these meetings — because you have a data warehouse person, a data person, an analytics person, you have an architect. And you can't make decisions in a vacuum. You have to have everyone in a room. They would spend days and days out at our place, touching, feeling, working. ÔYes, this portal is what we want. It has these elements. Yes, it runs this fast. We get these data reports. Yes, it's what's we want.' We don't wait until the whole system is done. It's an activity-based approach."

Every Monday morning, a status meeting is held among the partners and OPM to review deliverables and raise any potential problems. There's also a daily briefing first thing every morning with the project team.

Issues are extremely complicated and often thorny. For example, "We had hundreds of agencies to get data from and everyone had a different system, so data would be sent in different formats," Mr. Goodrich said.

In one situation, a certain module's definition was based on 70 data elements, he said. "And then the agencies kept coming in and it ended up being 700 data elements. That changed the cost dramatically… We raised the issue and made a recommendation [to the client]." That part of the work was put off, and now it's being brought back into the project.

–>TIP #4: Incorporate quality assurance. Get users involved regularly to make sure the quality applies to what really matters about the project.

How was quality assurance handled? "We built quality assurance into the project and deliverables," said Mr. Goodrich. Quality assurance was not viewed as an add-on but incorporated into every project activity. End user involvement was critical, and OPM was immersed in providing feedback and ensuring quality standards were met. "We also ran hundreds of user groups and included them in reviews and testing," he added.

"We have a single client, but that single client has to meet the needs of many other entities," he said. And, in fact, he explained, OPM will be billing the other agencies for their use of the HR services. The moment a chargeback is part of the program, suddenly, the client's clients become even more demanding.

"We're running work groups with all the different agencies, and creating technical definitions and data element compositions and definitions and agreeing on them, which takes a tremendous amount of time and is very arduous," he said. "But when you have a million leaders to this thing, you have to get consensus… We involve them not only in upfront requirements and definitions, but all along the way… We don't throw things over the transom and say, ÔHey, is this what you want?' They're touching it and feeling it and participating in the development every step of the way. So then what comes out the other end is exactly what they want…. Everything is addressed in real time and fixed in real time."

–>TIP #5: Expect the unexpected to hit you in some form.

Achieving all of the deliverables was not easy, and unexpected setbacks arose. After the project was in the midst of operations, cutbacks hit OPM and the federal budget, affecting the funding of this project. "It forced us to make very clear decisions on priorities, reduce staff, make tradeoffs and have the client play more of an active role," said Mr. Goodrich.

"You have a situation where everybody wants the whole enchilada," he said. "Even when budget is cut back, everybody recognizes that the client has had to cut their budget, but they still want everything. We had to make very clear decisions… We would say, ÔBased on what we know about the end users, these three modules are very important, and they have to come, but this fourth one– that can wait another year or six months.'"

Early on, the project faced unexpected hardware limitations, which was out of COE's management control. So, for instance, rather than doing testing that involved 500 users, the company limited it to 100, which required changes in how the user base was spread out across agencies.

The way that COE handles that sort of change is by putting it into the weekly report, then getting everybody involved to sign off on it.

"Part of it is, you have to take responsibility as a developer and an integrator for every aspect of the program, whether you own it or not, in order to realize success on this," he said.

COE also uses a "configuration control board," made up people from its team and the client side. Currently, there are seven or eight people on the board.

"Every time a change is necessary or comes in, that board reviews it and makes a recommendation," said Mr. Goodrich. "When you're building technology, it's not just an issue of, ÔOK, go ahead and make that change.' That change has an effect on this issue and this issue and that issue. So we have a board that meets constantly to address every one of the changes."

–>TIP #6: Be flexible about deliverables when push comes to shove.

Making sure deliverables were met in a timely way was no easy task in this huge IT project. At the beginning, deliverables were organized into three primary areas: documentation, the system itself and infrastructure support. It became clear that documentation would not meet its July 2004 deadline and have 30 years of each employee's history online. "If we can't do 30 years by [the deadline], let's do 15 years," Mr. Goodrich said the configuration control board decided.

The final deliverable date — where upon all 1.8 million users will have access to the system — was eventually postponed (as of this writing) until September 30, 2005, a year longer than the original schedule called for.

Ms. Gross added that the delay of the deliverable encouraged the team to "break down the release into smaller work components with more frequent deployments to production." That led to "end users getting to see enhancements to the system earlier and more frequently," she said.

–>TIP #7: Build change management into the system.

Since federal agencies have a reputation for resisting change, COE made a concerted effort to explain to federal agencies how this new system would improve their lives and efficiencies. "We did a massive marketing and change management effort. We did training, not just to HR, demos, briefings, and trade shows," Mr. Goodrich said.

Still, several federal employees told him, "We prefer paper. We like the touch and feel of it." They were reassured that electronic files would operate effectively and had proper security and back-up. They were also reminded that relinquishing paper would be in the federal government's best interests.

Even with the complexity of the undertaking, the system is functioning for OPM. Central Employee Record, Business Intelligence and Workforce Analysis and Forecasting are operating.

Why has it been successful so far? Three factors, Mr. Goodrich replied, "We've shown strong and decisive leadership and an ability to make decisions, we communicate constantly, and we work collaboratively."

The strategic planning services of COE enabled OPM to develop a plan that goes beyond simply delivering software that works. "Part of our responsibility is not just to take what the client says and build it," said Mr. Goodrich. "You have to work collaboratively. You have to use both your technology expertise as well as your content expertise in the system — and your knowledge of the marketplace, in other words, who it's going to serve. And you have to use that to make clear recommendations and guide the client to help them make decisions."

Useful Links:

Office of Personnel Management
http://www.opm.gov/

Center for Organizational Excellence
http://www.center4oe.com/

AT&T
http://www.att.com

Excella Consulting
http://www.excellaconsulting.com/

Idea Integration Corp.
http://www.idea.com/main.asp

Integic Corp./Northrop Grumman
http://www.integic.com/

Lockheed Martin
http://www.lockheedmartin.com

Telelogic DOORS requirements management software
http://www.telelogic.com/products/doorsers/index.cfm