Information Technology
U.S. Postal Service Needs to Strengthen System Acquisition and Management Capabilities to Improve Its Intelligent Mail Full Service Program Gao ID: GAO-10-145 October 29, 2009In 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.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-10-145, Information Technology: U.S. Postal Service Needs to Strengthen System Acquisition and Management Capabilities to Improve Its Intelligent Mail Full Service Program
This is the accessible text file for GAO report number GAO-10-145
entitled 'Information Technology: U.S. Postal Service Needs to
Strengthen System Acquisition and Management Capabilities to Improve
Its Intelligent MailŪ Full Service Program' which was released on
November 30, 2009.
This text file was formatted by the U.S. Government Accountability
Office (GAO) to be accessible to users with visual impairments, as part
of a longer term project to improve GAO products' accessibility. Every
attempt has been made to maintain the structural and data integrity of
the original printed product. Accessibility features, such as text
descriptions of tables, consecutively numbered footnotes placed at the
end of the file, and the text of agency comment letters, are provided
but may not exactly duplicate the presentation or format of the printed
version. The portable document format (PDF) file is an exact electronic
replica of the printed version. We welcome your feedback. Please E-mail
your comments regarding the contents or accessibility features of this
document to Webmaster@gao.gov.
This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed
in its entirety without further permission from GAO. Because this work
may contain copyrighted images or other material, permission from the
copyright holder may be necessary if you wish to reproduce this
material separately.
Report to Congressional Requesters:
United States Government Accountability Office:
GAO:
October 2009:
Information Technology:
U.S. Postal Service Needs to Strengthen System Acquisition and
Management Capabilities to Improve Its Intelligent MailŪ Full Service
Program:
GAO-10-145:
GAO Highlights:
Highlights of GAO-10-145, a report to congressional requesters.
Why GAO Did This Study:
In 2003, the United States Postal Service (USPS) initiated the
Intelligent MailŪ 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 MailŪ Full Service program and (2) if the Postal
Service has capabilities in place to successfully acquire and manage
the Intelligent MailŪ Full Service program. GAO obtained and analyzed
USPS documentation, reviewed previous GAO reports, interviewed
officials, and compared acquisition best practices with USPS‘s
practices.
What GAO Found:
Program officials have completed key activities for implementing the
Intelligent MailŪ 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.
Table: Summary of the Full Service Program Acquisition Management
Capabilities:
Capability: Project planning;
Status: Initiated, but key activities remain to be completed, such as
developing an overall project plan that identifies the full scope of
the Full Service program and identifying key deliverables beyond the
second phase.
Capability: Project monitoring and control;
Status: Key steps taken, but the prime contractor for the development
of the Full Service program also manages program management office
activities, including assessing the quality of deliverables and
overseeing the program‘s schedule, issues, and risks, which creates a
conflict of interest because of the risk that the contractor will not
evaluate its own products in a completely objective manner.
Capability: Requirements development and management;
Status: Initiated, but USPS has not finalized or validated a core set
of requirements for the Full Service program.
Capability: Risk management;
Status: Initiated, but key activities remain to be performed, such as
establishing a risk management process that ensures a comprehensive
list of risks is maintained and complete mitigation strategies are
developed.
Capability: Product integration;
Status: Initiated, but program officials have not developed a systems
integration plan regarding the plans for conducting product integration
for the entire Full Service program, which includes the integration of
approximately 30 systems.
Source: GAO analysis of USPS data.
[End of table]
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.
What GAO Recommends:
GAO is recommending that the Postmaster General take several actions to
improve the management of the program, including developing a
comprehensive cost estimate and sound acquisition and development
policies. In written comments on a draft of this report, USPS agreed
with three of GAO‘s recommendations, disagreed with three, and did not
comment on one. GAO continues to believe that adoption of key
acquisition practices is essential.
View [hyperlink, http://www.gao.gov/products/GAO-10-145] or key
components. For more information, contact David A. Powner at (202) 512-
9286 or pownerd@gao.gov.
[End of section]
Contents:
Letter:
Conclusions:
Recommendations for Executive Action:
Agency Comments and Our Evaluation:
Appendix I: Briefing to the House Oversight and Government Reform
Subcommittee Staff:
Appendix II: Comments from the United States Postal Service:
Appendix II: IGAO Contact and Staff Acknowledgments:
Abbreviations:
CMMI-ACQ: Capability Maturity ModelŪ Integration for Acquisition:
CMMI-Dev: Capability Maturity ModelŪ Integration for Development:
FAR: Federal Acquisition Regulation:
IMB/SASP: Intelligent MailŪ Barcode/Seamless Acceptance and Service
Performance:
IT: information technology:
SEI: Software Engineering Institute:
USPS: United States Postal Service:
[End of section]
United States Government Accountability Office:
Washington, DC 20548:
October 29, 2009:
The Honorable Stephen F. Lynch: Chairman:
Subcommittee on Federal Workforce, Postal Service and the District of
Columbia:
Committee on Oversight and Government Reform:
House of Representatives:
The Honorable Danny K. Davis:
House of Representatives:
In 2003, the United States Postal Service (USPS) initiated the
Intelligent MailŪ program, which is intended to use information-rich
standardized barcodes to track mail and thus provide USPS and mailers
with better and timely information about the mail. As part of this
program, USPS has initiated the Full Service program, which is intended
to (1) build a system that improves the visibility into end-to-end mail
processing operations through the use of new barcodes, (2) gather more
comprehensive and detailed service performance information and measure
it against established performance standards, and (3) create
efficiencies by streamlining and automating certain aspects of the
process USPS uses to verify mail from commercial mailers. In May 2009,
we issued a report that described the Intelligent MailŪ program and
stated that key management actions were not taken, such as developing a
comprehensive strategic plan; preparing information about the program's
costs, including its anticipated savings or cost reductions; and
establishing a risk mitigation plan. In addition, we highlighted
commercial mailers' concerns about the implementation of the program.
[Footnote 1]
At your request, we conducted a follow-up review on this program to
determine (1) the current status and plans for the Intelligent MailŪ
Full Service program and (2) if the Postal Service has capabilities in
place to successfully acquire and manage the Intelligent MailŪ Full
Service program.
This report summarizes the information we provided to your staff during
our September 9, 2009, briefing, which was updated to indicate that the
agency's position on our findings and recommendations were revised by
written comments provided October 15, 2009. The full briefing
materials, including our scope and methodology, are included as
appendix I.
We conducted this performance audit from February 2009 to October 2009,
in accordance with generally accepted government auditing standards.
Those standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe that
the evidence obtained provides a reasonable basis for our findings and
conclusions based on our audit objectives.
In summary, we made the following major points:
* Program officials have completed key activities for implementing the
Full Service program, including the first phase being deployed in May
2009 and activities beginning for the second phase. However, USPS
officials currently plan to deliver the program in multiple phases in
lieu of the original plan, which was to deliver the entire Full Service
program by January 2009. As a result, the first of two planned phases
of the program was deployed in May 2009, and the second phase is
expected to be implemented by the end of November 2009. In addition,
key functionality (including automating aspects of the mail acceptance
process) that was originally intended to be delivered in these two
planned phases has been deferred. Program officials have recently
stated that they plan to have future phases to incorporate the deferred
functionality; however, they have not made any commitments to do so. In
addition, the life-cycle cost that program officials prepared does not
capture all the costs associated with the acquisition and
implementation of the program, such as costs to integrate several USPS
systems. Finally, the first deployed phase is currently experiencing
operational problems, thus requiring program officials to develop
patches to resolve the issues.
* While the Intelligent MailŪ Full Service program has implemented
initial acquisition management activities, it does not have the full
set of capabilities it needs to fully manage the acquisition. For
example, the Full Service program has established a program office and
assigned a USPS project manager, but the program has not developed an
overall project plan that identifies the full scope of the Full Service
program or identified key deliverables beyond release 2. Also, the
program office tracks the milestones and dependencies of the program;
however, a conflict of interest exists because the prime contractor for
the development of the Full Service program also manages program
management office activities. Although USPS officials have told us they
use strategies to avoid potential conflicts, such as utilizing a
separate program management team from the system development team, they
have not provided us with evidence that they have a formal mitigation
plan in place to address the conflict that exists. In addition, the
program office has defined initial business requirements for releases 1
and 2, but USPS has not finalized or validated a complete set of
requirements for the Full Service program, which would include high-
level requirements that USPS plans to deliver in future releases. Also,
although the program office has assigned responsibility for managing
the risks, it has not established a risk management process that
ensures a comprehensive list of risks is maintained and complete
mitigation strategies are developed. Additionally, while the program
office has identified approximately 30 systems that will need to be
integrated in the Full Service program, it has not developed a Systems
Integration Plan describing the plan for conducting product integration
for the entire Full Service program. Until USPS fully implements key
acquisition management processes, the Intelligent MailŪ Full Service
program is at risk of continuing to encounter problems in meeting its
performance, schedule, and cost objectives.
Conclusions:
The current schedule for the full implementation of the Full Service
program has been delayed by almost 10 months, and key functionality
that was originally intended to be delivered in the program has been
deferred indefinitely. In addition, the life-cycle cost estimate 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. Moreover, the
first deployed release is experiencing performance issues.
While the Full Service program has implemented initial acquisition
management activities, it does not have the full set of capabilities
needed 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.
While organizational policies exist for requirements development and
management, weaknesses exist in this area, in part, because USPS
decided not to follow USPS's organizational policies for system
acquisition and instead followed a truncated program management
approach in an effort to deliver the system in a compressed time frame.
Without these processes in place, USPS increases the risk that this
project will continue to encounter problems in meeting its performance,
schedule, and cost objectives.
Given that release 2 is expected to be implemented by the end of
November 2009 and decisions about future releases need to be made,
having the key elements of a sound acquisition management capability in
place will be crucial to the program's success in meeting its goal.
Recommendations for Executive Action:
To ensure that USPS adequately manages the acquisition of the
Intelligent MailŪ Full Service program, we recommend that the
Postmaster General take seven actions. Specifically, we recommend that
the Postmaster General 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.
* Complete 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.
* Reconsider the current contract arrangement to avoid having the
contractor evaluate its own performance.
* Define the core set of requirements for the entire program and use
them as a basis for developing a reliable cost estimate.
* 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.
* Develop and maintain a systems integration plan for release 2 and
beyond.
We are also recommending that the Postmaster General 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 Comments and Our Evaluation:
We obtained written comments on a draft of this report from the USPS
Senior Vice President of Intelligent Mail and Address Quality, which
are reprinted in appendix II. USPS agreed with three of our
recommendations, disagreed with three, and did not comment on one.
Specifically, USPS agreed that (1) the current contract arrangement
should be reconsidered to avoid having the contractor evaluate its own
performance, (2) a comprehensive risk management process should be
developed, and (3) a system integration plan for release 2 and beyond
should be developed and maintained. The agency further stated that it
has and will continue to enable these capabilities. In previously
commenting on our briefing slides, USPS disagreed with aspects of our
findings on these issues or provided additional information that we
incorporated as appropriate. USPS's subsequent written comments on this
draft report, which recognize the need to implement these
recommendations, provide greater assurance of program success.
The Senior Vice President stated that the disagreement with three of
our recommendations may be the result of our use of the 2003
Intelligent MailŪ strategy document to measure the program's
performance. However, we reviewed and analyzed many documents to form
the basis of our findings and conclusions on the program's performance.
The 2003 strategy was just one of the many documents we used, as it
represented the original baseline and justification for the program. To
report on the progress of the program since its inception, we measured
the program against original plans, while acknowledging that USPS has
made multiple modifications to the implementation dates.
USPS also stated that we relied on the 2003 strategy to determine
delays to the program. This comment is inaccurate. As we stated in this
report, we relied on the January 2008 Intelligent MailŪ Advance Notice
of Proposed Rulemaking in the Federal Register to identify the
originally proposed implementation time frame. We also reported the
subsequent revisions that USPS made to the program's implementation
schedule.
The Senior Vice President disagreed with our recommendation to develop
a comprehensive cost estimate. He stated such an activity would consume
a significant amount of funding, time, and resources, while providing
little or no value. However, as stated in our GAO Cost Estimating and
Assessment Guide,[Footnote 2] developing a realistic cost estimate is
essential because it enables program officials to evaluate resource
requirements at key decision points, develop performance measurement
baselines, and establish effective resource allocations. Additionally,
cost estimates should be comprehensive and should include both
government and contractor costs throughout the program's full life
cycle, from the inception of the program through design, development,
deployment, and operation and maintenance to retirement. While we
acknowledge that preparing a realistic cost estimate may require some
amount of effort, we believe the benefits of having an accurate total
cost estimate for the entire program to make better informed resource
allocation decisions, clearly merit its completion.
With regard to our recommendation to complete an overall program plan
for the entire Full Service program, the Senior Vice President stated
that, while USPS plans to start updating the Intelligent MailŪ strategy
on an annual basis, it plans to remain focused on its clearly defined
actions for the current releases, rather than planning for future
releases. However, industry best practices specifically state that a
project plan is the essential document used to manage and control the
execution of a project. In order for the project plan to be an
effective and useful document, it should consider all phases of the
project's life cycle. Program officials should also ensure that all
plans affecting the project are consistent with the overall project
plan to ensure that all releases and associated functionality
seamlessly fit together. As we state in our report, without such a plan
that describes the full scope of the program, including how many
releases are envisioned, USPS lacks an overarching approach for
incorporating future releases into the program. Additionally, without
this information, USPS may not be able to ensure the program is
accomplishing its complete set of goals within the specified cost and
schedule objectives.
Regarding our recommendation to define a core set of requirements for
the entire program and use them to develop reliable cost estimates, the
Senior Vice President stated that the program must remain dynamic and
that any attempt to define the entire program and its associated cost
is a waste of funding and resources. We are not recommending that USPS
define all detailed system-level requirements at the outset of the
program; rather, we are recommending that USPS develop a roadmap of the
program's high-level requirements. As we state in this report, without
a core set of high-level requirements, it will be difficult for USPS to
focus appropriately on the next release and to hold itself accountable
for delivering a system that meets USPS's and mailers' needs. Defining
these requirements is especially important given the functionality that
is being deferred in the first two releases.
USPS program officials did not state whether they agreed or disagreed
with our recommendation that USPS include in its Technical Solution
Life Cycle policy guidance for programs to develop (1) complete program
plans, (2) specific requirements for programs to establish a robust
risk management process, and (3) a system integration plan.
As agreed with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days
from its issue date. At that time, we will send copies of this report
to interested congressional committees and other interested parties. In
addition, the report will be available at no charge on the GAO Web site
at [hyperlink, http://www.gao.gov].
Should you or your offices have questions on matters discussed in this
report, please contact me at (202) 512-9286 or at pownerd@gao.gov.
Contact points for our Offices on Congressional Relations and Public
Affairs may be found on the last page of this report. GAO staff who
made key contributions to this report are listed in appendix III.
Signed by:
David A. Powner:
Director, Information Technology Management Issues:
[End of section]
Appendix I: Briefing to the House Oversight and Government Reform
Subcommittee Staff:
Information Technology: U.S. Postal Service Needs to Strengthen System
Acquisition and Management Capabilities to Improve Its Intelligent
MailŪ Full Service Program:
Briefing for staff members of the Subcommittee on Federal Workforce,
Postal Service, and the District of Columbia, Committee on Oversight
and Government Reform:
House of Representatives:
September 9, 2009
Table of Contents:
* Introduction:
* Objectives, Scope, and Methodology:
* Results in Brief:
* Background:
* Results:
- Objective 1: Full Service Program Status and Plans;
- Objective 2: Adequacy of Acquisition Management Capabilities;
* Conclusions:
* Recommendations for Executive Action:
* Agency Comments and Our Evaluation:
[End of section]
Introduction:
The U.S. Postal Service (USPS) relies heavily on information technology
(IT) to support its mission of providing prompt, reliable, and
efficient mail service to all areas of the country. Starting in May
2009, as part of a program referred to as the Intelligent MailŪ
program, USPS began to encourage commercial mailers[Footnote 3] to use
new standardized barcodes which are intended to make it easier to track
and provide information about the mail‘s progress as it flows through
the mail stream. According to USPS officials, this information is
important to their efforts to improve efficiency and reduce costs.
The Intelligent MailŪ program encompasses numerous programs, including
a major initiative known as the Full Service program. This initiative
is intended to:
* build a system that improves the visibility into end-to-end mail
processing operations through the use of new barcodes,
* gather more comprehensive and detailed service performance
information and measure it against established performance standards,
and,
* create efficiencies by streamlining and automating certain aspects of
the process USPS uses to verify mail from commercial mailers.
USPS is planning to implement the program in multiple software releases”
thus far it has committed to implementing two releases: the first one
was deployed in May 2009 and the other is planned to be implemented by
November 2009. Program officials have recently stated that they also
plan to have future releases; however, they have not made any
commitments to do so or obtained funding approval.
USPS says the Full Service program is one of the most complex programs
it has undertaken”it will involve the integration of approximately 30
different systems and is intended to benefit both commercial mailers
and USPS.
[End of section]
Objectives, Scope, and Methodology:
As agreed, our objectives were to determine:
* the current status and plans for the Intelligent MailŪ Full Service
program and,
* if the Postal Service has capabilities in place to successfully
acquire and manage the Intelligent MailŪ Full Service program.
For our first objective, we analyzed system documentation, including
plans, status reports, meeting minutes, cost estimates, schedule
estimates, reports on program management reviews, test plans, and other
acquisition-related documents. We also compared the cost and schedule
estimates to actual cost and schedule information. In addition, we
compared contract deliverables to the actual milestones and
deliverables achieved. Finally, we interviewed Postal Service officials
and reviewed our previous reports and Inspector General reports to
determine the program‘s status and plans.
For our second objective, we identified widely recognized industry
standards for good acquisition and development practices, including
processes defined in the Software Engineering Institute‘s Capability
Maturity ModelŪ Integration for Acquisition (CMMI-ACQ) and for
Development (CMMI-DEV).[Footnote 4] From this guidance we identified
the following process areas as being the most relevant to our review:
(1) project planning, (2) project monitoring and control, (3)
requirements development and management, (4) risk management, and (5)
product integration. We compared USPS documentation, such as
organizational policies, contract information, status reports, meeting
minutes, requirements for the program, process documentation, and risk
information to SEI‘s guidance on sound IT systems acquisition and
management practices in the five process areas. We also interviewed
Postal Service officials about these key process areas to help us
understand whether the agency has the capabilities in place to
successfully acquire and manage the program.
We conducted this performance audit from February 2009 to August 2009
at United States Postal Service headquarters in Washington, D.C., in
accordance with generally accepted government auditing standards. Those
standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe that
the evidence obtained provides a reasonable basis for our findings and
conclusions based on our audit objectives.
[End of section]
Results in Brief:
Although USPS officials originally intended to deliver the entire Full
Service program by January 2009, they currently plan to deliver the
program in multiple releases”the first of two planned releases of the
Full Service program was deployed on May 18, 2009. The second release
is expected to be implemented by the end of November 2009.
Additionally, key functionality that was originally intended to be
delivered in these two planned releases has been deferred, including
automating aspects of the mail acceptance process. Program officials
have recently stated that they plan to have future releases to
incorporate the deferred functionality; however, they have not made any
commitments to do so or obtained funding approval. Program officials
estimate that the life cycle cost of the program is $116.4 million, of
which $65.9 million has been spent as of June 3, 2009. However, the
life cycle cost estimate that program officials prepared does not
capture all the costs associated with the acquisition and
implementation of the program, such as costs to integrate approximately
30 systems with the Full Service program. Moreover, the first deployed
release is currently experiencing operational problems (e.g., applying
inconsistent charges for certain mail pieces). Therefore, program
officials are developing patches to resolve these issues and to
implement system enhancements.
While the Full Service program has implemented initial acquisition
management activities, it does not have the full set of capabilities it
needs to fully manage the acquisition.
Table 1: Summary of the Full Service Program Acquisition Management
Capabilities:
Capability: Project planning;
Status: Initiated, but key activities remain to be completed, such as
developing an overall project plan that identifies the full scope of
the Full Service program and identifying key deliverables beyond the
second phase.
Capability: Project monitoring and control;
Status: Key steps taken, but the prime contractor for the development
of the Full Service program also manages program management office
activities, including assessing the quality of deliverables and
overseeing the program‘s schedule, issues, and risks, which creates a
conflict of interest because of the risk that the contractor will not
evaluate its own products in a completely objective manner.
Capability: Requirements development and management;
Status: Initiated, but USPS has not finalized or validated a core set
of requirements for the Full Service program.
Capability: Risk management;
Status: Initiated, but key activities remain to be performed, such as
establishing a risk management process that ensures a comprehensive
list of risks is maintained and complete mitigation strategies are
developed.
Capability: Product integration;
Status: Initiated, but program officials have not developed a systems
integration plan regarding the plans for conducting product integration
for the entire Full Service program, which includes the integration of
approximately 30 systems.
Source: GAO analysis of USPS data.
[End of table]
A key cause of the program‘s immature management approach 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 itself creates a conflict of interest by requiring
the contractor to assess the quality of its own deliverables, and
oversee the program‘s schedule, issues, and risks. Although USPS
officials have told us they use strategies to avoid potential
conflicts, such as developing a separate program management team from
the system development team, they have not provided us with evidence
that they have a formal mitigation plan in place to address the
conflict that exists. While organizational policies exist for
requirements development and management, weaknesses exist in this area,
in part, because USPS decided not to follow its organizational policies
for system acquisition and instead followed a truncated program
management approach in an effort to deliver the system in a compressed
timeframe.
Until USPS fully implements these key acquisition management processes,
the Intelligent MailŪ Full Service program is at risk of continuing to
encounter problems in meeting its performance, schedule, and cost
objectives.
We are recommending that the Postmaster General direct USPS‘s Chief
Information Officer and Senior Vice President of Intelligent Mail and
Address Quality to take the following actions to improve the management
of its acquisition capabilities: (1) develop a comprehensive cost
estimate; (2) complete a program plan for the entire Full Service
program; (3) reconsider the current contract arrangement to avoid
having the contractor review its own performance; (4) define
requirements for the entire program and use them as a basis for
developing a reliable cost estimate; (5) develop a robust risk
management process; and (6) develop and maintain a systems integration
plan for release 2 and beyond.
We are also recommending that the Postmaster General 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; (2) specific requirements for programs to establish a robust
risk management process; and (3) system integration plan.
In e-mail comments on a draft of these briefing slides, the Senior Vice
President of Intelligent Mail and Address Quality did not state whether
he agreed or disagreed with our recommendation to develop a
comprehensive cost estimate for the program. He disagreed with our
findings and conclusions regarding the program‘s acquisition management
capabilities. Specifically,
* With regard to project planning, the Senior Vice President stated
that federal best practices do not reflect the dynamic environment that
drives the scope, requirements, and schedule of future releases of the
Full Service program. We disagree, as industry best practices call for
an overarching plan that describes a program‘s full scope in order to
ensure that it is accomplishing its goals.
* Regarding the current contract arrangement, he did not acknowledge
that a conflict of interest exists. Although the contracting officer
has identified this arrangement as a concern, program officials have
not acknowledged this risk nor have they established formal mitigation
plans to address it.
* He further disagreed with our findings on requirements development
and management, stating that there is not enough funding to define
requirements for the full program. Without a core set of high-level
requirements, however, USPS will face challenges in focusing on the
next release and holding itself accountable to users‘ needs.
* Regarding risk management, the Senior Vice President noted that the
program has a risk manager and a risk management process in place.
However, we found that several key risks were not included in risk
reports, complete mitigation plans were not developed, and they did not
have a comprehensive risk management plan.
* Regarding product integration, the Senior Vice President stated that
the program provided us with a systems integration plan. However, these
documents defined testing strategies, not a comprehensive system
integration plan.
Finally, USPS‘s program officials did not state whether they agreed or
disagreed with our recommendations that USPS modify its current policy
to provide guidance for USPS programs to, among other things, develop
complete program plans.
[End of section]
Background: Intelligent MailŪ Program:
Since the 1970s, the use of barcodes and automation has improved
efficiency in USPS mail processing operations. Commercial mailers have
been encouraged to use barcodes through pricing incentives, allowing
USPS to cut costs and increase efficiency in its mail processing
operations. In particular, automated mail processing machines can sort
mail with barcodes containing delivery information faster than manual
sorting. Over the past three decades, the number and type of barcodes
increased along with technology changes, and in 2003 USPS estimated
that there were more than 30 different barcodes in use. Two of the most
commonly used barcodes are the following:
* POSTNET, which contains delivery information that enables automated
sorting of the mail to the carrier‘s route level. Mailers receive a
postage discount when they print POSTNET barcodes on their mail.
* PLANET, which is a barcode that contains identification numbers to
enable tracking mail in USPS‘s mail processing system but contains less
information than the new Intelligent MailŪ barcode.
According to USPS, the use and maintenance of numerous barcodes have
become increasingly burdensome. For example, whenever USPS adds or
upgrades its mail processing equipment, it has to ensure that the
equipment remains compatible with each of the relevant barcodes.
Additionally, printing numerous barcodes on mail pieces clutters the
pieces, thus reducing the ’real estate“ that mailers have to advertise
or print other information on their envelopes (see figure 1).
Figure 1: Example of Different Barcodes on a Letter:
[Refer to PDF for image: illustration]
The following are indicated on the illustration:
Certified mail label;
PLANET Code;
POSTNET Code.
Source: U.S. Postal Service and GAO.
[End of figure]
In 2003, USPS initiated the Intelligent MailŪ program, which is
intended to use information-rich standardized barcodes to track mail
and thus provide USPS and mailers with better and timelier information
about the mail. Figure 2 illustrates the components of the Intelligent
MailŪ barcode.
Figure 2: Example of an Intelligent MailŪ Barcode, Including its
Information Fields:
[Refer to PDF for image: illustration]
Included in illustration are the following numerical identifiers:
1-2: [Empty];
3-5: Service type;
6-14: Mailer identification number;
15-20: Unique number[A];
21-31: Delivery address information.
Source: U.S. Postal Service and GAO.
[A] The unique number is either six digits (as shown in the shaded
area) or nine digits, depending on the mail volume of the mailer.
[End of figure]
USPS has identified several ways it expects the implementation of
Intelligent MailŪ to benefit USPS and mailers:
* Improve efficiency, reduce costs, and improve timeliness of delivery.
USPS says it will be able to use information from Intelligent MailŪ to
improve its processing system. Also, USPS plans to use Intelligent
MailŪ to create efficiencies by streamlining and automating the process
it uses to accept mail from commercial mailers, which is currently
time- and labor-intensive.
* Reduce the amount of mail that must be forwarded, which can involve
extra handling by USPS and delays in delivery. USPS will provide free
notification when intended recipients have moved and filed a change of
address with USPS. Mailers previously had to pay for this service. This
feature, known as the Address Correction Service, could help USPS meet
its goal of reducing the amount of mail that cannot be delivered.
* Provide better service to mailers. Through Intelligent MailŪ, USPS
plans to provide better service to mailers through real-time feedback.
Also, since mail will be uniquely identified, USPS anticipates having
the ability to isolate and give special handling to a specific mail
piece, which creates an opportunity for USPS to offer mailers new
products and services.
* Financial incentives. USPS is also offering a financial incentive to
mailers. Specifically, those who adopt Full Service Intelligent MailŪ
will receive a postage discount, in addition to other worksharing
discounts.[Footnote 5]
* Service performance measurement capability. Intelligent MailŪ is
expected to allow USPS to gather more comprehensive and detailed
service performance information and measure it against established
performance standards, which is intended to help keep USPS accountable
to its stakeholders. This feature was also intended to enable USPS to
meet requirements in the Postal Accountability and Enhancement Act of
2006.
Background: Intelligent Mail‘sŪ Full Service Program:
Intelligent Mail‘sŪ Full Service program is intended to include custom
software capabilities and supporting hardware that will enable mailers
and the Postal Service to gain visibility into the mail stream and
achieve the benefits of the Intelligent MailŪ program.
The Full Service program consists of developing new systems and
integrating approximately 30 systems. The largest system development
project within the Full Service program is the development of the
Intelligent MailŪ Barcode/Seamless Acceptance and Service Performance
(IMB/SASP) system. It is intended to deploy an infrastructure that
includes hardware and software capabilities needed to capture and store
large volumes of mailing data and to acquire and implement a system
that supports better service performance measurement as mandated by the
Postal Accountability and Enhancement Act of 2006. It is also intended
to automate several business mail verification activities.
The 29 other systems are a combination of existing and new systems that
need to integrate with the IMB/SASP system in order to share data. An
example of one of the existing USPS systems that must be integrated
with the IMB/SASP is Postal One”the main communications interface
between USPS and mailers. Upgrades to PostalOne include designing a
better external user interface, adding electronic documentation
acceptance capabilities, and providing more options for mailers to
access mail tracking information.
The Facilities Database”a repository of all USPS facilities data,
including facility names, addresses, physical characteristics, and
services provided, is another system that USPS plans to integrate with
IMB/SASP in order to attribute mail pieces to the appropriate
locations.
Table 2 provides a summary of the key functionality of the program.
Table 2: Summary of Key Functionality Intended for the Full Service
Program:
Functionality: Enable the Intelligent MailŪ Barcode Implementation;
Description: This system will support USPS's vision of replacing
multiple existing barcodes and labels with one standardized,
information-rich code for letters, postcards, and flats (e.g. larger
envelopes, catalogs, circulars, newspapers, and magazines) and
submitting electronic documentation. Starting in May 2009, mailers have
two options that offer different incentives based on the level of
effort required for mailers to comply:
Basic Service: Requires mailers to apply an Intelligent MailŪ barcode
and populate the relevant fields within the barcode, but does not
require mailers to include unique numbers in the barcode. Mailers who
implement the Basic Service option will receive a postage discount for
using a barcode, but will not receive other benefits associated with
Full Service option.
Full Service: Requires mailers to populate and apply a barcode, but
unlike the Basic Service option, the barcode must contain a number that
is unique to the particular mail piece. Full Service mailers must also
apply a unique barcode to any trays or containers they use to package
mail and submit electronic documentation of their mailings. USPS
provides pricing discounts and other incentives for mailers
implementing Full Service option.
Functionality: Support for Service Performance Measurement;
Description: This functionality will support Service Performance
reporting by collecting data when mail enters the mail stream, scanning
customer mailings prepared with the Intelligent MailŪ barcodes, and
collecting the information associated with when a mail piece reaches
its destination.
Functionality: Automated Aspects of Mail Verification;
Description: This functionality is intended to obtain scan data
received from mail processing equipment and compare it to mailing data
received electronically from the mailer, to verify that the mail is
prepared according to the prices claimed by the mailer.
Functionality: Upgrade Processing Network and IT infrastructure;
Description: This functionality is intended to integrate existing and
new systems in order to share data and store large volumes of mailing
information.
Source: GAO analysis of USPS data.
[End of table]
Several USPS groups support the execution of the Full Service program:
* The Full Service Program Directors”the Senior Vice President of
Intelligent Mail and Address Quality and the Chief Information Officer”
head the program. Their responsibilities include reviewing deliverables
and conducting governance meetings that focus on the status of the
program, issues, and risks.
* The Program Management Office activities are performed by a
contractor, Accenture, who reports directly to the Program Directors.
The responsibilities for the contractor include program status
reporting, communications management, scope and release management,
issue and risk management, and selective quality deliverable audits.
* The Marketing Technology and Channel Management group is the business
organization responsible for business mail acceptance process re-
engineering and field deployment activities, including field
preparedness, developing test plans, newsletters, and training and
awareness.
* The Sales and Marketing Portfolio is the IT organization responsible
for development, integration, and systems deployment activities.
Figure 3 graphically depicts the organizational structure for the Full
Service Program.
Figure 3: Simplified Full Service Organizational Structure:
[Refer to PDF for image: illustration]
Top level:
* USPS Full Service Program Directors.
Second level, reporting to USPS Full Service Program Directors:
* Program Management Office (under the direction of Accenture);
* Sales and Marketing Portfolio;
* Marketing Technology and Channel Management.
Third level, reporting to Sales and Marketing Portfolio:
* Electronic Documentation Team;
* Full Service Compliance Team;
* System Testing Team.
Third level, reporting to Marketing Technology and Channel Management:
* Business Process Re-engineering Team;
* Customer Interaction Team;
* Field Deployment Team.
Source: GAO analysis of USPS data.
[End of figure]
The program‘s estimated life cycle cost is $116.4 million. In November
2007, USPS awarded its first contract in a series of contracts for the
Full Service program to the prime contractor, Accenture. As of June 3,
2009, USPS has awarded $65.9 million in contracts for the Full Service
program. The contracts for the requirements development, designing,
building, and testing are firm fixed price.Footnote 6]
Background: Prior GAO Review:
In May 2009, we issued a report that described the Intelligent MailŪ
program and stated that key management actions were not taken, such as
developing a comprehensive strategic plan; preparing information about
the program‘s costs, including its anticipated savings or cost
reductions; and establishing a risk mitigation plan. In addition, we
highlighted commercial mailers‘ concerns about the implementation of
the program.[Footnote 7] Specifically, the mailers stated that USPS
communication efforts were insufficient; USPS and mailers may not be
ready for implementation given USPS‘s short time frame to
simultaneously design, develop, test, and implement the Intelligent
MailŪ program; and the program‘s pricing and benefits may not be
sufficient to encourage mailers to participate.
As such, we recommended that USPS develop a comprehensive Intelligent
MailŪ strategic plan, as well as develop a plan that addresses how USPS
will mitigate program-level risks. In its response to our
recommendations, USPS agreed to develop a comprehensive Intelligent
MailŪ strategy, including all planned phases and the associated
functions and systems, program goals, and measures of success; and a
plan that addresses how it will mitigate risks.
[End of section]
Objective 1: Full Service Program Status and Plans:
Program officials have completed key activities for implementing the
Full Service program, including deploying the first release on May 18,
2009, and beginning activities for release 2. However, while USPS
officials originally intended to deliver the entire Full Service
program by January 2009, they currently plan to deliver the program in
multiple releases”the first of two planned releases of the program was
deployed on May 18, 2009. The second release is expected to be
implemented by the end of November 2009. Therefore, full implementation
of the program has been delayed by almost 10 months. Additionally, key
functionality that was originally intended to be delivered in these two
planned releases has been deferred, including automating aspects of the
mail acceptance process. Program officials have recently stated that
they plan to have future releases to incorporate the deferred
functionality; however, they have not made any commitments to do so. In
addition, the life cycle cost that program officials prepared does not
capture all the costs associated with the acquisition and
implementation of the program, such as costs to integrate several USPS
systems. Moreover, the first deployed release is currently experiencing
operational problems, thus requiring program officials to develop
patches to resolve the issues.
Objective 1: Full Service Program Status and Plans: Current
Implementation Status:
Although USPS officials originally intended to deliver the entire Full
Service program by January 2009, they currently plan to deliver the
program in multiple releases. The current implementation schedule for
the Full Service program is as follows:
Release 1:
* May 11, 2009. USPS internally implemented the first release which
enables certain functions, such as the Address Correction Service and
electronic documentation.
* May 18, 2009 and beyond. Mailers began testing their systems‘ ability
to access and electronically transmit documentation to USPS‘s system.
Release 2:
* November 29, 2009. USPS plans to deploy the second release of the
Full Service program and expects to begin offering price incentives to
mailers that utilized the Full Service program.
Future Releases:
* No commitments have been made by program officials for future
releases.[Footnote 8]
By May 2011, the use of POSTNET and PLANET barcodes will be phased out
and mailers seeking reduced automation-postage rates will be required
to use Intelligent MailŪ barcodes. Based on the current revised
schedule, table 3 summarizes the key functionality by releases.
Table 3: Summary of Key Functionality by Releases:
Release 1 (May 2009):
* Support the communication protocols used by mailers to electronically
submit mailing information to USPS.
* Support Customer Supplier Agreements
* Enable the service that identifies exactly when the mail enters the
mail stream for mailers using the existing communication protocols.
* Enable address correction for mailers using the existing
communication protocols.
* Support mailers‘ appointment scheduling, data distribution, and
miscellaneous messages.
Release 2 (Nov. 09):
* Support the Intelligent MailŪ Barcode discount pricing for Full
Service option.
* Support the improved protocol for communicating with USPS.
* Enable the service that identifies exactly when the mail enters the
mail stream versus an estimate for mailers using a new communications
protocol.
* Enable address correction for mailers using a new communications
protocol.
* Support miscellaneous data messages for the new communication
protocol.
* Support the process of combining trays from multiple letter-size
mailers together in order to qualify for postal discounts.
* Support the printing of one or more pages that are not bound into a
publication.
* Support additional enhancements that were not provided in release 1.
Source: GAO analysis of USPS data.
[End of table]
As of June 3, 2009, $65.9 million had been spent on the acquisition and
implementation of the first release and the development of requirements
for the second release.
Objective 1: Full Service Program Status and Plans: Implementation Has
Been Delayed:
The current implementation schedule represents a significant delay from
its original and revised implementation dates. Specifically,
* In January 2008, USPS published the Intelligent MailŪ Advance Notice
of Proposed Rulemaking in the Federal Register, which originally
proposed implementing all functionality of the program by January 2009.
[Footnote 9]
* In April 2008, USPS issued a revised Intelligent MailŪ Federal
Register notice which pushed back the implementation date to May 2009.
[Footnote 10] This was due to several concerns by the mailers, such as
the compressed time period in which USPS planned to simultaneously
design, test, and implement the program. Mailers were also concerned
that they had not been provided with finalized IT requirements.
* Subsequently, in November 2008, program officials planned to
incrementally deliver functionality in multiple releases and delay full
implementation further. Specially, they committed to delivering three
releases”the first in May 2009, a second in September 2009, and a third
in November 2009. According to USPS officials, the schedule was revised
to accommodate the implementation of the Intelligent MailŪ barcode and
to allow mailers more time to make appropriate modifications to their
systems and processes.
* However, in January 2009, program officials again revised its
schedule: they planned to deliver select functionality in a release in
May 2009 and additional functionality in another release in November
2009. According to program officials, they decided that delivering
three releases in such a short time frame was too ambitious.
See figure 4 for a summary of the Full Service program‘s original and
revised implementation schedule as of June 2009.
Figure 4: Full Service Program Original and Revised Implementation
Schedule, as of June 2009:
[Refer to PDF for image: illustration]
First contract awarded for the full service program: November 2007.
Original release date: January 2008; All program functionality
implemented by January 2009.
Revised release date: April 2008; All program functionality implemented
by May 2009.
Revised release schedule: November 2008; Functionality delivered in
three releases implemented by November 2009;
Release 1 in May 2009;
Release 2 in September 2009;
Release 3 in November 2009.
Revised release schedule: January 2009; Functionality delivered in two
releases implemented by November 2009:
Release 1 in May 2009;
Release 2 in November 2009.
Source: GAO analysis of USPS date.
Note: While program officials have recently stated they also plan to
have future releases to incorporate the deferred functionality, they
have not made any commitments to do so or obtained funding approval.
[End of figure]
Objective 1: Full Service Program Status and Plans: Steps Have Been
Taken to Implement Key Program Activities:
To meet the current implementation schedule, USPS has been engaged in
design and build activities for release 2. For example, program
officials stated that they completed the requirements definition phase
for the second release. Figure 5 shows the schedule for key activities
for release 2 as of June 4, 2009.
Figure 5: Schedule of Key Activities for Release 2, as of June 4, 2009:
[Refer to PDF for image: illustration]
First contract awarded for the full service program: November 2007.
Release 2 Phases:
Requirements defined: April-June, 2009;
System design: June-July, 2009;
System build and product testing: July-September, 2009;
System integration testing: September, 2009;
Customer acceptance testing: October, 2009;
Deployment: November-December, 2009.
Source: Agency data.
[End of figure]
Objective 1: Full Service Program Status and Plans Functionality Has
Been Deferred:
In addition to implementation delays, key functionality that was
originally intended to be delivered in the two planned releases of the
Full Service program has been deferred. Specifically, despite the fact
that automating several aspects of the business mail verification
process was one of the key justifications for the Full Service program,
this function is not going to be delivered in the two releases.
Additionally, USPS recently announced, in August 2009, that enabling
the ability to better measure and report USPS‘s service performance is
no longer going to be delivered in the second release, as planned.
According to USPS officials, service performance measurement
functionality has been deferred because it was taking longer than
planned to implement, and they wanted to be able to deliver other
promised functionality in release 2 by November 29, 2009. This is
especially problematic since USPS is legislatively required to develop
a system to better measure and report its service performance to the
Postal Regulatory Commission, and the Full Service program was the
vehicle USPS planned to use to meet that mandate.[Footnote 11]
While program officials announced on August 12, 2009, that they are
aiming to develop a third release by March 12, 2010, program officials
indicated that they have not obtained funding to implement this release
or future releases. According to program officials, one of the primary
reasons for not moving forward with such decisions is that funding for
future releases may not be available as a result of USPS‘s current
financial situation.[Footnote 12] We recently reported that amid
challenging economic conditions and a changing business environment,
USPS is facing a deteriorating financial situation in which it does not
expect to cover its expenses and financial obligations in fiscal years
2009 and 2010.[Footnote 13] As a result, we added the financial
condition of USPS to our high-risk list of federal areas in need of
transformation.
Objective 1: Full Service Program Status and Plans: Program Life Cycle
Cost Was Not Completely Defined:
According to industry best practices, programs must maintain current
and well-documented cost estimates, and these estimates must encompass
the full life cycle of the program. Specifically, as stated in the GAO
Cost Estimating and Assessment Guide,[Footnote 14] cost estimates
should be comprehensive in that they should include both government and
contractor costs throughout the program‘s full life cycle, from the
inception of the program through design, development, deployment, and
operation and maintenance to retirement.
According to the business case, the life cycle cost estimate of the
Full Service program is $116.4 million. This includes the costs to
develop the custom software capabilities, necessary hardware to support
the software capabilities, and operating and maintenance cost.
However, the life cycle cost estimate excludes key costs associated
with the acquisition and implementation of the Full Service program.
For example, the estimate does not include:
* costs related to the integration of the systems or,
* the cost of future releases beyond release 2.
Additionally, the life cycle cost has not been updated to reflect the
significant changes that have been made to the program. While a revised
business case to reflect the modified schedule and scope for the
program was approved in June 2009, program officials did not update the
life cycle cost of the program.
According to program officials, they did not include all of the costs
associated with integrating the system because they did not regard the
costs to be significant enough to include. Additionally, officials
stated that they did not include the costs of the future releases
because they are uncertain if they are going to be able to deliver
those releases.
As a result, program officials lack an accurate total cost estimate for
the entire Full Service program.
Objective 1: Full Service Program Status and Plans: Operational
Problems and System Enhancements Have Been Identified in First Release:
In addition to implementation delays, deferred requirements, and an
unreliable cost estimate, USPS is experiencing operational problems and
has identified the need for system enhancements with the first release
of the Full Service system. Program officials are working to address
these problems and enhancements by implementing three patches. As of
June 18, 2009, according to USPS officials, USPS and mailers had
identified 73 issues. A portion of the issues were reportedly resolved
in a patch that was deployed on June 7, 2009. Subsequently, another
patch was deployed on July 19, 2009.
Examples of issues reportedly resolved in these two patches include:
* certain mailers and mail pieces were being incorrectly charged,
* the system was not recognizing certain zone values,
* the system was preventing mailers from putting Intelligent MailŪ
barcodes on certain mail pieces,
* reporting functions were not working as intended,
* system was not allowing mailers to enter certain information on
individual mail pieces, and,
* after logging into account and clicking through the available links,
mailers were receiving an error message when they tried to return to
the homepage.
A third patch is scheduled to be deployed on August 16, 2009. Examples
of operational problems and system enhancements intended to be
addressed include:
* system is incorrectly creating a finalized postage statement for
mailers who canceled or updated a job,
* system does not accept certain updates after postage statements are
final and ready to accept payment,
* inconsistent charges are being applied to a secured group of mail
pieces, and,
* certain electronic documentation is not being transmitted through the
system.
[End of section]
Objective 2: Adequacy of Acquisition Management Capabilities:
Acquisition Management Capabilities Are Needed:
USPS Lacks Key Management Capabilities Essential to Effectively Acquire
and Manage the Full Service Program:
USPS is in the process of implementing key acquisition management
controls, but it has yet to implement the full set of controls
essential for acquiring and managing the Full Service program in a
disciplined and rigorous manner. Specifically, it has not implemented
certain process controls in the areas of:
* project planning,
* project monitoring and control,
* requirements development and management,
* risk management, and,
* product integration.
The primary cause of the program‘s immature management approach 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. While
organizational policies exist for requirements development and
management, weaknesses exist in this area in part because USPS decided
not to follow its organizational policies for system acquisition and
instead took a truncated program management approach in an effort to
deliver the system in a compressed timeframe.
Until USPS implements the full set of controls essential to effectively
managing the program, it increases the risk that the Full Service
program will continue to encounter problems in meeting its performance,
schedule, and cost objectives.
As we have previously reported,[Footnote 15] to effectively manage
major IT programs, organizations must use sound acquisition and
management processes to minimize risks and thereby maximize chances for
success. Such processes have been identified by leading organizations
such as the Software Engineering Institute, the Chief Information
Officer‘s Council, and in our prior work analyzing best practices in
industry and government. In particular, the CMMI-ACQ[Footnote 16] and
CMMI-DEV[Footnote 17] have defined a suite of key acquisition process
control areas that are necessary to manage system acquisitions in a
rigorous and disciplined fashion. These process areas include:
* project planning,
* project monitoring and control,
* requirements development and management,
* risk management, and,
* product integration.
Project Planning:
Effective project planning involves establishing and maintaining plans
that define project scope and activities, including overall budget and
schedule, key deliverables and milestones for key deliverables,
assumptions and constraints, description and assignment of roles and
responsibilities, staffing and training plans, and an approach for
maintaining these plans. It also involves obtaining stakeholder
commitment to the project plan.[Footnote 18]
The Full Service program officials have:
* established a program office for the Full Service program and
assigned a USPS project manager;
* hired a contractor to carry out program management activities
including tracking schedule, issues, and risks for the program;
* identified the tasks and organizational roles and responsibilities
for release 1;
* developed a program plan for release 2 that identifies key
deliverables and milestones for these deliverables; and;
* developed a business case for the Full Service program.
While officials have developed a business case for the Full Service
program and a program plan for release 2, there still is no
comprehensive program plan that includes the full scope of the program,
including how many releases are planned and the specific functions and
systems to be implemented in each release; its plans to standardize and
consolidate the over 30 barcodes currently being used; assumptions and
constraints about the program; a description and assignment of roles
and responsibilities; staffing and training plans; and the strategy for
maintaining the program plan. In addition, program officials have not
yet obtained commitment from internal and external stakeholders on the
program plan for release 2. Such a plan is often used to form a
baseline for the program and to obtain buy-in from stakeholders.
A key reason that these activities have not been completed is that
USPS‘s policy that outlines the steps that programs should follow when
developing, acquiring, enhancing, and/or maintaining IT systems”
referred to as the Technical Solution Life Cycle policy”does not
require that officials develop a comprehensive plan for their programs.
Until program officials develop a complete program plan that supports
the Intelligent MailŪ Strategic Plan, which we previously recommended,
[Footnote 19] and includes the details on the full scope of the Full
Service program, USPS may not be able to ensure that the program is
moving in the right direction. Without this assurance, it is more
likely to encounter unanticipated changes in direction”which could
affect cost, schedule, and deliverables.
Project Monitoring and Control:
Project monitoring and control involves providing oversight of the
contractor‘s and the project office‘s performance, in order to allow
appropriate corrective actions if actual performance deviates
significantly from the plan. Key activities in tracking both the
contractor‘s and the project office‘s performance include communicating
status, taking corrective actions, and determining progress.[Footnote
20] In addition, organizations should have IT investment management
boards comprised of key executives to regularly track the progress of
major systems acquisitions. These boards should be able to adequately
oversee the project‘s progress toward cost and schedule milestones and
its risks. The board should also employ early warning systems that
enable it to take corrective actions at the first sign of cost,
schedule, and performance slippages.[Footnote 21]
With regard to project monitoring and control activities, program
officials:
* track the milestones and dependencies of the program; and;
* review the activities, status, and results of the process with higher
level program management, USPS senior executives representing both IT
and business units, and the contractor.
However, the main contractor performing the development and
implementation functions of the Full Service program is also the
contractor carrying out USPS‘s program management activities.
Specifically, according to the Program Management Office contract, the
contractor is responsible for:
* assessing the quality of program deliverables;
* overseeing the program‘s schedule, issues, and risks;
* assessing the project plan‘s critical path which is necessary for
examining the effects of any activity slipping along this path;
[Footnote 22]
* developing project status materials for USPS program officials,
including bi-weekly detailed status reports to the program manager and
weekly status reports to IT management and project teams; and;
* participating in weekly deliverable reviews from other USPS internal
and external suppliers, including documenting all meeting minutes, and
action items.
The roles that the contractor plays as both a manager of the Full
Service program and as a supplier of products for the program create a
conflict of interest because of the risk that the contractor will not
evaluate its own products in a completely objective manner. USPS
program officials stated that they do not think that this is an issue
because the company‘s program management staff work on a separate team
from the system development staff and the two teams do not interact;
however, this arrangement still requires the contractor to assess the
quality of its own deliverables, and oversee the program‘s schedule,
issues, and risks. USPS officials have not provided us with evidence
that they have a formal mitigation plan in place to address the
conflict that exists under the contract.
While we recognize that USPS is not required to comply with the Federal
Acquisition Regulation (FAR), these regulations can be instructive
since they are used by federal agencies for acquiring goods and
services.[Footnote 23] According to the FAR, an underlying principle is
that, in order to avoid a conflict of interest, a contractor should not
have conflicting roles that might bias a contractor‘s judgment.
[Footnote 24]
Until program officials reconsider having the same contractor that is
developing and implementing the system be responsible for helping USPS
oversee the program, USPS will increase its risk of unexpected cost
increases, schedule delays, and performance shortfalls.
Requirements Development and Management:
Requirements development involves eliciting, analyzing, and validating
customer and stakeholder needs and expectations. Requirements
management involves establishing an agreed-upon set of requirements,
ensuring traceability between operational and product requirements, and
managing any changes to the requirements in collaboration with
stakeholders.[Footnote 25]
With regard to requirements development and management, program
officials have:
* defined the initial business requirements dated August 16, 2007, for
release 1;
* defined requirements for release 2; and;
* developed a change control process for managing changes to the
requirements.
While USPS has defined the requirements for release 1 and release 2, it
has not finalized or validated the core set of requirements for the
Full Service program, which would include high-level requirements that
USPS plans to deliver in future releases. These core requirements would
need to be further defined as the program begins to focus on the next
release. Program officials stated that they did not fully define the
program‘s requirements because the requirements are still evolving.
Until program officials define the core set of requirements for the
program it will be difficult for USPS to hold itself accountable to
delivering a system that meets USPS‘s and mailers‘ needs.
Risk Management:
An effective risk management process identifies potential problems
before they occur, so that risk-handling activities may be planned and
invoked as needed across the life of the product and project in order
to mitigate adverse impacts on achieving objectives. Key activities
include assigning resources, identifying and analyzing risks, and
developing risk mitigation plans and milestones for key mitigation
deliverables. Additionally, a risk management strategy addresses the
specific actions and management approach used to perform and control
the risk management program. It also includes identifying and involving
relevant stakeholders in the risk management process.[Footnote 26]
With regard to risk management, program officials have:
* assigned responsibility for managing the risks and;
* identified and analyzed selected risks associated with schedule,
performance, and testing. Examples of the selected program-level risks
include:
- limited mailer adaptation and adoption can affect future Full Service
releases,
- program success measurements are not defined,
- parallel program activities have caused resource constraints,
- components of scope have not been planned for release 2, and,
- mailers require significantly more support than estimated to assist
them with the implementation of the Intelligent MailŪ barcode.
However, they did not adequately identify all risks. For example,
* While the USPS contracting officer indicated in the program
management contract‘s price negotiation memorandum that having the same
company perform program management activities as well as development
and implementation activities for the Full Service program is a major
concern, program officials have not identified this as a risk or
established a complete mitigation strategy.
* Program officials stated that they include the list of risks the
system development contractor identifies as part of the program
management office‘s risk reports. However, as of July 16, 2009, there
was no evidence in the reports that contractor risks were being
identified or mitigated.
* While program officials are concurrently conducting activities for
release 2 and unplanned post-deployment efforts for release 1, they
have not identified potential schedule delays in release 2 as a risk or
established a mitigation plan.
Moreover, as we have previously reported,[Footnote 27] USPS lacks a
risk mitigation plan, and therefore we recommended that USPS develop a
plan that addresses how it will mitigate program-level risks. Although
USPS agreed with this recommendation, it has not yet developed complete
risk mitigation plans. During this review we found that while USPS
recently finalized a risk management plan for release 2, it is not
comprehensive and does not fully address the scope of the risk
management effort, including discussing techniques for risk mitigation,
defining adequate risk sources and categories, and identifying and
involving relevant stakeholders to promote commitment and understanding
of the process.
The program‘s weaknesses in the risk management area are partly due to
the fact that USPS‘s Technical Solution Life Cycle policy does not set
forth sufficient requirements regarding risk management.
Until program officials fully implement and institutionalize a risk
management process that ensures the comprehensiveness of the risks
identified, there is an increased probability that unanticipated risks
may occur that could have a critical impact on the Full Service
program‘s cost, schedule, and performance.
Product Integration:
The scope of this process area is to achieve complete product
integration through progressive assembly of product components. A
critical aspect of this area is the management of internal and external
interfaces of the products and product components to ensure
compatibility among the interfaces. Attention should be paid to
interface management throughout the project.[Footnote 28] In addition,
a systems integration plan should be developed to identify all systems
to be integrated, define roles and responsibilities of all relevant
participants, establish the sequence and schedule for every integration
step, and describe how integration problems are to be documented and
resolved.[Footnote 29]
With regard to product integration, program officials have identified
approximately 30 systems that will need to be integrated in the Full
Service program. However, USPS officials have stated that the number of
systems that need to be integrated could change, and they are not yet
aware of which specific systems will need to be integrated in release 2
or in possible future releases. In addition, while program officials
stated they have several program documents, such as testing strategies,
they do not have a system integration plan, which is intended to
support the deployment strategy and describe to key stakeholders in
each integration step what needs to be done to effectively integrate
the various systems. The program office also lacks documentation of the
process associated with updating and maintaining the integration of the
systems.
Part of the reason that these activities have not been completed is
that USPS‘s Technical Solution Life Cycle policy does not set forth
sufficient requirements regarding product integration and does not
require that programs develop system integration plan and associated
documentation regarding updating and maintaining the integration of the
systems.
Until program officials develop these key product integration
documents, USPS will be limited in its ability to ensure that the
product is integrated, functioning properly, and delivered on time and
within budget to the users.
[End of section]
Conclusions:
The current schedule for the full implementation of the Full Service
program has been delayed by almost 10 months, and key functionality
that was originally intended to be delivered in the program has been
deferred indefinitely. In addition, the life cycle cost estimate 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. Moreover, the
first deployed release is experiencing performance issues.
While the Full Service program has implemented initial acquisition
management activities, it does not have the full set of capabilities
needed to fully manage the acquisition. A key cause of the program‘s
immature management approach 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
itself creates a conflict of interest by requiring the contractor to
assess the quality of its own deliverables, and oversee the program‘s
schedule, issues, and risks. Although USPS officials have told us they
use strategies to avoid potential conflicts, such as developing a
separate program management team from the system development team, they
have not provided us with evidence that they have a formal mitigation
plan in place to address the conflict that exists.
While organizational policies exist for requirements development and
management, weaknesses exist in this area, in part, because USPS
decided not to follow USPS‘s organizational policies for system
acquisition and instead followed a truncated program management
approach in an effort to deliver the system in a compressed timeframe.
Without these processes in place, USPS increases the risk that this
project will continue to encounter problems in meeting its performance,
schedule, and cost objectives.
Given that release 2 is expected to be implemented by the end of
November 2009 and decisions about future releases need to be made,
having the key elements of a sound acquisition management capability in
place will be crucial to the program‘s success in meeting its goal.
[End of section]
Recommendations for Executive Action:
To ensure that USPS adequately manages the acquisition of the
Intelligent MailŪ Full Service program, we recommend that the
Postmaster General direct the Chief Information Officer and Senior Vice
President of Intelligent Mail and Address Quality to take the following
six actions:
* 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.
* Complete 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.
* Reconsider the current contract arrangement to avoid having the
contractor evaluate its own performance.
* Define the core set of requirements for the entire program and use
them as a basis for developing a reliable cost estimate.
* Develop a risk management process that enables the program officials
to develop an adequate risk management plan that fully address 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.
* Develop and maintain a systems integration plan for release 2 and
beyond.
We are also recommending that the Postmaster General 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.
[End of section]
Agency Comments and Our Evaluation:
We received comments via e-mail from the Senior Vice President of
Intelligent Mail and Address Quality on a draft of these briefing
slides.[Footnote 30] He did not state whether he agreed or disagreed
with our recommendation to develop a comprehensive cost estimate. The
Senior Vice President disagreed with our findings and conclusions
regarding the program‘s acquisition management capabilities.
* With regard to project planning, he stated he disagreed with the
static approach suggested in our briefing. He stated that the scope,
requirements, and schedule of future releases are driven by a dynamic
environment both internal and external to USPS. However, as we state in
the briefing, industry best practices show that it is important to have
an overarching program plan that describes the full scope of the
program, including how many releases are planned, in order to ensure
that the program is accomplishing its goals within the specified cost
and schedule objectives.
* Regarding project monitoring and control activities, the Senior Vice
President provided additional clarifying information on executive-level
oversight, which we have incorporated into the briefing as appropriate.
He did not acknowledge that a conflict of interest exists. While the
USPS contracting officer identified that having the same company
perform program management activities as well as development and
implementation activities for the Full Service program is a concern,
the program office has not identified that this arrangement is a
conflict of interest. In fact, the program office has not even
identified this arrangement as a risk that it tracks in its risk
tracking process. Despite this, program officials have explained
actions they are taking to mitigate the potential risk of a conflict of
interest, such as establishing separate teams for the program
management staff and system development staff. However, they have not
presented us with any evidence of a formal mitigation plan that is in
place to address the actual conflict of interest that is introduced by
the responsibilities that are specified in the program management
office contract, which states that the contractor must assess the
quality of deliverables and oversee the program‘s schedule, issues, and
risks. Unless USPS reconsiders the current contract arrangement to
avoid having the contractor evaluate its own performance, there is an
increased risk that the conflict of interest will negatively impact the
program.
* Regarding our findings with regard to requirements development and
management activities, the Senior Vice President stated that he
disagreed because there is not enough approved funding to define the
requirements for the full program”they only received funding for a
portion of the program. However, as we state in the briefing, without a
core set of high-level requirements, it will be difficult for USPS to
focus appropriately on the next release and to hold itself accountable
to delivering a system that meets USPS's and mailers' needs. Defining
these requirements is especially important given the functionality that
is being deferred in the first two releases.
* Regarding risk management activities, he stated that the program has
a defined, active, cross-program process and a risk manager who is
responsible for managing this process. While we acknowledge that the
program has developed a tracking process, which includes assigning
responsibility for managing and identifying risks, several key risks,
such as the risk for potential schedule delays in release 2 as a result
of conducting concurrent activities for release 2 and release 1, were
not included by the program office as part of their risk reports and
complete mitigation plans were not developed. Additionally, the
recently finalized risk management plan for release 2 is not
comprehensive and does not fully address the scope of the risk
management effort. Until USPS develops a strategy for ensuring a
comprehensive list of risks and that includes mitigation efforts, it
increases the probability that unanticipated risks may occur that could
have a critical impact on the program‘s cost, schedule, and
performance.
* The Senior Vice President disagreed with our finding on product
integration activities. He stated that a systems integration plan for
conducting product integration was provided to us. However, the
documents provided to us included testing strategies and not a system
integration plan, which is intended to support the deployment strategy
and to describe to key stakeholders in each integration step what needs
to be done to effectively integrate the various systems. Until these
key product integration documents are developed, USPS will be limited
in its ability to ensure that the product is integrated and functioning
properly.
Additionally, USPS program officials did not state whether they agreed
or disagreed with our recommendation that USPS include in its Technical
Solution Life Cycle policy, guidance for programs to develop (1)
complete program plans; (2) specific requirements for programs to
establish a robust risk management process; and (3) system integration
plan.
[End of Briefing Slides section]
Appendix II: Comments from the United States Postal Service:
United States Postal Service:
Thomas G. Day:
Senior Vice President:
Intelligent Mail And Address Quality:
475 L'Enfant Plaza, SW:
Washington DC, 20260-4400:
202-268-6200:
Fax: 202-268-4402:
October 15, 2009:
David A. Powner:
Director, Information Technology Management Issues:
U.S. Government Accountability Office (GAO):
441 G Street, NW:
Room 4721:
Washington, DC 20548-0001:
Dear Mr. Powner:
This letter is the USPS response to the draft GAO report "Information
Technology: U.S. Postal Service Needs to Strengthen System Acquisition
and Management Capabilities to Improve Its Intelligent Mail Full
Service Program".
Over the course of the last nine months the Postal Service has worked
closely with GAO Auditors to provide information and in-depth
explanations about the Intelligent MailŪ program. As the report
indicates, the U.S. Postal Service has been responsive to a variety of
finding and recommendations. The summary of the draft report lists five
Acquisition Management Capabilities; 1) Project Planning; 2) Project
Monitoring and Control; 3) Requirements Development and Management; 4)
Risk Management and 5) Product Integration. In all five capabilities
the GAO found that USPS had initiated steps to ensure the capability
was in place.
Despite the actions initiated by USPS to enhance these Acquisition
Management Capabilities, the draft report continues to cite
deficiencies. In several instances USPS is in agreement with the GAO
finding and recommendation. Where we are in agreement, USPS has and
will continue to enable these capabilities. However, there are several
findings and recommendations to which there is a fundamental
disagreement.
The disagreement may result from GAO's continued use of the 2003
Intelligent MailŪ strategy document. For example, the draft report
indicates "the program has been delayed by almost 10 months." This
"delay" is measured against an original vision of Intelligent MailŪ
implementation in January 2009 and assumes that at that time ALL
functionality would be in place at that time.
Both the funding approval document (Decision Analysis Report - DAR) and
the strategic vision document were updated to reflect the current plans
for Intelligent MailŪ. In the case of the DAR, the approved document
details both the approved funds and the defined functionality for
Release 1 and 2. This funding document also indicates that should
additional capital funds be required for further enhancements to
Intelligent Mail another DAR would be developed. The strategic vision
document was updated in July 2009 and is posted on-line for access by
mailers. The intent is to update the strategic vision document on an
annual basis.
From the standpoint of USPS, the GAO is utilizing an outdated document
as the standard for performance. While the overall vision for
Intelligent MailŪ remains relatively stable, the specific plans for
implementation have evolved significantly.
The passage of the Postal Accountability and Enhancement Act in 2006
created a significantly modified regulatory environment. For example,
there is now a requirement to report service performance for all market
dominant products. Intelligent MailŪ will serve as the cornerstone for
performance measurement for Pre-sort First Class, Periodical and
Standard Mail. None of this was envisioned when the original vision was
created in 2003. Further, the Postal Regulatory Commission is now
undertaking a rule-making process that will further revise the means by
which Intelligent MailŪ will be employed to fulfill this requirement.
Since 2003 significant improvements in both hardware and software have
modified the specific plans to implement Intelligent MailŪ. Further,
the economic situation has significantly impacted the financial
position of the USPS and many of its commercial customers. The scope,
scale and schedule for implementation of Intelligent Mail must take
this into consideration. The pace of implementation may be slowed or
quickened based upon the financial position of USPS and its commercial
customers.
Measuring USPS Intelligent MailŪ program implementation against a
static document does not make sense. We will continue to update
implementation plans in accordance with the evolving needs and
capabilities of both USPS and its commercial customers. The expectation
of the creation of a long-term static document, let alone measuring
against that document is unrealistic.
The following recommendations were included in the Draft report:
* 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.
The USPS experience with the use of Barcodes in a production
environment spans over 2 decades. It is extremely difficult to envision
the timeframe in which the use of Intelligent MailŪ Barcodes will be
retired. The creation of such a document would consume a significant
amount of funding, time and resources, while providing little or no
value. USPS has and will continue to focus on defined scope and
requirements to determine costs.
* Complete 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.
As indicated the strategic vision document was updated in July 2009 and
will be updated on an annual basis. In addition, USPS works closely
with the Mailing Industry to define both scope and requirements for
upcoming releases. Rather than devote both USPS and Industry resources
to theoretical releases, we will remain focused upon clearly defined
actions in the immediate future.
As previously indicated, a number of outside factors (evolving
regulatory environment, economic/financial situation, improvements in
technology, needs of customers, etc) do not lend themselves to the
creation of a static planning document.
* Reconsider the current contract arrangement to avoid having the
contractor evaluate its own performance.
We are in agreement that this arrangement should be reconsidered. At
this time we have evaluated the risk and have provided appropriate
mitigation. Longer term we need to consider the use of other vendors
and create a seamless transition to ensure ongoing effective program
management.
* Define the core set requirements for the entire program and use them
as a basis for developing a reliable cost estimate.
As indicated in the response to the second bullet, this must remain a
dynamic program. Any attempt to define "the entire program" and the
cost associated is a waste of funding and resources.
* Develop a risk management process that enables the program officials
to develop an adequate risk management plan that fully address 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.
USPS is in agreement with the recommendation, however disagrees with
the finding. The finding would indicate that USPS lacks a process for
creating and managing risk. On the contrary a robust process has been
in place for many months and is actively managed by the leadership of
the Intelligent MailŪ program.
* Develop and maintain a system integration plan for release 2 and
beyond.
USPS is in agreement with this recommendation on a release by release
basis. As scope, requirements and design are reviewed and agreed upon
within a given release; system integration is a critical aspect of the
review. Attempting to determine system integration plans beyond defined
requirements/design is ill-advised and not a "best practice".
Signed by:
Thomas G. Day:
[End of section]
Appendix III: GAO Contact and Staff Acknowledgments:
GAO Contact:
David A. Powner at (202) 512-9286 or pownerd@gao.gov:
Staff Acknowledgments:
In addition to the individual named above, Shannin G. O'Neill,
Assistant Director; Neil Doherty; Rebecca E. Eyler; Mary D. Fike;
Franklin Jackson; Lee McCracken; Niti Tandon; Christy A. Tyson; and
Adam Vodraska made key contributions to this report.
[End of section]
Footnotes:
[1] GAO, U.S. Postal Service: Intelligent Mail Benefits May Not Be
Achieved if Key Risks Are Not Addressed, [hyperlink,
http://www.gao.gov/products/GAO-09-599] (Washington, D.C.: May 2009).
[2] GAO, GAO Cost Estimating and Assessment Guide: Best Practices for
Developing and Managing Capital Program Costs, [hyperlink,
http://www.gao.gov/products/GAO-09-3SP] (Washington, D.C.: March 2009).
[3] Commercial mailers include businesses, organizations, and other
parties that send and rely on mail to maintain contact with their
customers. The commercial mailers also encompass mail preparers,
including printers and businesses that send or receive mail on behalf
of a third party. As of 2008, these mailers accounted for 86 percent of
all mail processed by USPS.
[4] Carnegie Mellon Software Engineering Institute, Capability Maturity
ModelŪ Integration for Acquisition (CMMI-ACQ), Version 1.2 (November
2007) and Carnegie Mellon Software Engineering Institute, Capability
Maturity ModelŪ Integration for Development (CMMI-DEV) Version 1.2
(August 2006).
[5] This concept, known as worksharing, generally involves mailers
qualifying for reduced postage rates by performing certain activities
such as preparing and barcoding mail so it can be sorted by USPS
automated equipment.
[6] Under firm fixed price contracts, the agency and the contractor
agree on a price and the contractor assumes full responsibility for all
costs and the resulting profit or loss.
[7] GAO, U.S. Postal Service: Intelligent Mail Benefits May Not Be
Achieved if Key Risks Are Not Addressed, [hyperlink,
http://www.gao.gov/products/GAO-09-599] (Washington, D.C.: May 2009).
[8] While program officials announced on August 12, 2009, that they are
aiming to develop a third release by March 12, 2010, program officials
indicated that they have not obtained funding to implement this release
or future releases.
[9] 73 Fed. Reg. 1158 (Jan. 7, 2008).
[10] 73 Fed. Reg. 23393 (April 30, 2008).
[11] The 2006 Postal Accountability and Enhancement Act required USPS
to develop a system to measure and report service performance to the
Postal Regulatory Commission.
[12] The Postmaster General testified in January 2009 that USPS was
facing a potential net loss of $6 billion or more for fiscal year 2009.
He noted that USPS anticipated continued deterioration due to the
economic slowdown, as the financial, credit, and housing sectors are
among its key business drivers.
[13] GAO, Restructuring the U.S. Postal Service to Achieve Sustainable
Financial Viability (New), [hyperlink,
http://www.gao.gov/products/GAO-09-937SP] (Washington, D.C.: July
2009).
[14] GAO, GAO Cost Estimating and Assessment Guide: Best Practices for
Developing and Managing Capital Program Costs, GAO-09-3SP (Washington,
D.C.: March 2009).
[15] For example, GAO, Information Technology: Management Improvements
Needed on Immigration and Customs Enforcement‘s Infrastructure
Modernization Program, [hyperlink,
http://www.gao.gov/products/GAO-05-805] (Washington, D.C.: September 7,
2005) and Census Bureau: Important Activities for Improving Management
of Key 2010 Decennial Acquisitions Remain to be Done, [hyperlink,
http://www.gao.gov/products/GAO-06-444T] (Washington, D.C.: March 1,
2006).
[16] Carnegie Mellon Software Engineering Institute, Capability
Maturity ModelŪ Integration for Acquisition (CMMI-ACQ), Version 1.2
(November 2007).
[17] Carnegie Mellon Software Engineering Institute, Capability
Maturity ModelŪ Integration for Development (CMMI-DEV), Version 1.2
(August 2006).
[18] CMMI-ACQ, Version 1.2 (November 2007) and The Institute of
Electrical and Electronics Engineers, IEEE Standard for Software Life
Cycle Processes”Project Management Plans, IEEE Standard 1058-1998
(December 8, 1998).
[19] [hyperlink, http://www.gao.gov/products/GAO-09-599].
[20] CMMI-ACQ, Version 1.2 (November 2007).
[21] GAO, Information Technology Investment Management: A Framework for
Assessing and Improving Process Maturity, [hyperlink,
http://www.gao.gov/products/GAO-04-394G] (Washington, D.C.: March
2004).
[22] The critical path is the longest duration path through the
sequenced list of key program activities.
[23] 48 C.F.R. 1.101; 1.104; 2.101(b) (’Acquisition“ defined). The FAR
generally applies to acquisitions made with appropriated funds used to
obtain supplies or services for the federal government.
[24] 48 C.F.R. 9.505(a).
[25] CMMI-ACQ, Version 1.2 (November 2007).
[26] CMMI-ACQ, Version 1.2 (November 2007).
[27] [hyperlink, http://www.gao.gov/products/GAO-09-599].
[28] CMMI-DEV, Version 1.2 (August 2006).
[29] U.S. Department of Transportation, Federal Highway Administration,
Systems Engineering Guidebook for ITS Version 2, January 2, 2007.
[30] The Senior Vice President revised the agency‘s position on GAO‘s
seven recommendations in written comments dated October 15, 2009. See
appendix II.
[End of section]
GAO's Mission:
The Government Accountability Office, the audit, evaluation and
investigative arm of Congress, exists to support Congress in meeting
its constitutional responsibilities and to help improve the performance
and accountability of the federal government for the American people.
GAO examines the use of public funds; evaluates federal programs and
policies; and provides analyses, recommendations, and other assistance
to help Congress make informed oversight, policy, and funding
decisions. GAO's commitment to good government is reflected in its core
values of accountability, integrity, and reliability.
Obtaining Copies of GAO Reports and Testimony:
The fastest and easiest way to obtain copies of GAO documents at no
cost is through GAO's Web site [hyperlink, http://www.gao.gov]. Each
weekday, GAO posts newly released reports, testimony, and
correspondence on its Web site. To have GAO e-mail you a list of newly
posted products every afternoon, go to [hyperlink, http://www.gao.gov]
and select "E-mail Updates."
Order by Phone:
The price of each GAO publication reflects GAO‘s actual cost of
production and distribution and depends on the number of pages in the
publication and whether the publication is printed in color or black and
white. Pricing and ordering information is posted on GAO‘s Web site,
[hyperlink, http://www.gao.gov/ordering.htm].
Place orders by calling (202) 512-6000, toll free (866) 801-7077, or
TDD (202) 512-2537.
Orders may be paid for using American Express, Discover Card,
MasterCard, Visa, check, or money order. Call for additional
information.
To Report Fraud, Waste, and Abuse in Federal Programs:
Contact:
Web site: [hyperlink, http://www.gao.gov/fraudnet/fraudnet.htm]:
E-mail: fraudnet@gao.gov:
Automated answering system: (800) 424-5454 or (202) 512-7470:
Congressional Relations:
Ralph Dawn, Managing Director, dawnr@gao.gov:
(202) 512-4400:
U.S. Government Accountability Office:
441 G Street NW, Room 7125:
Washington, D.C. 20548:
Public Affairs:
Chuck Young, Managing Director, youngc1@gao.gov:
(202) 512-4800:
U.S. Government Accountability Office:
441 G Street NW, Room 7149:
Washington, D.C. 20548:
