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Giant US Army ERP projects at risk

Giant US Army ERP projects at risk

Auditor warns of poor planning and project management on £6.5bn contracts

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Massive ERP (enterprise resource planning) software projects under way at the US Army are in danger of missing crucial deadlines due to inadequate planning and management on the part of officials, according to a new auditor's report.

The Army is planning to spend some $10.1 billion (£6.5 billion) on several ERP systems, but a strategy plan it created in February 2011 "did not include specific ERP implementation milestones and performance measures," according to the report by the Department of Defense's Inspector General. "OBT officials focused on near-term milestones but did not develop a comprehensive plan outlining milestones and performance measures for all planning periods."

Moreover, the strategy "did not focus on eliminating legacy system interfaces and incorporating additional functionalities into the ERPs," the report adds.

The Army is under a deadline, enacted by Congress in 2010, to have fully auditable financial statements by 2017. Defense Secretary Leon Panetta has also called for the Army to ensure that at least its Statement of Budgetary Resources is auditable by 2014.

The ERP systems under development are critical to meeting these goals, but as it stands now, the Army seems at risk of missing the deadlines, according to the Inspector General.

The report's findings, while not as dire as others issued in recent years, could play like familiar music to anyone who has followed the US government's long track record of IT cost overruns and failed projects.

In November, the US Air Force said it would pull the plug on a $1 billion ERP project after determining that finishing it would incur far too much cost for too little benefit.

Last month, the Senate Armed Services Committee said it would launch a probe into the failed project, just days after lawmakers on Capitol Hill held a hearing calling for ways to reduce wasteful government IT spending.

As much as $20 billion of the $80 billion the US government spends on IT projects each year is wasted, while the rate of IT spending has nearly doubled over the past 10 years, according to lawmakers.

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