VA Is Transforming its IT Organization to a Centralized Model

In response to the challenges that we and others noted, the  department officially began its effort to provide the CIO with greater  authority over IT in October 2005. By July 2006, the  department’s realignment contractor began work to assist with the  realignment effort. By implementing these improved processes, VA expects to  correct deficiencies it has encountered as a result of its  decentralized management approach. Among the significant factors we identified as critical for ensuring  the success of VA’s move to centralized management are   ●  ensuring commitment from top leadership,   ●  establishing a governance structure to manage resources,   linking the IT strategic plan to the organization strategic plan,   ●  using workforce strategic management to identify proper roles for  ●  communicating change to all stakeholders, and   ●  dedicating an implementation team to manage change. Successful Implementation of the Realignment Effort Requires Continued Focus on Critical Success Factors and Implementation of Improved Management Processes

In our recent review of the department’s effort to realign its IT  program, we evaluated, among other things, whether the  realignment plan includes the critical factors for successful  transformation as discussed above. We reported that VA’s  realignment plan included elements of several of the six critical  success factors that we identified. The department had fully addressed the first critical success factor,  ensuring commitment from top leadership, as demonstrated by the  Secretary’s actions in support of the realignment. Although it had highlighted the importance of managing  change in its realignment documentation, VA did not plan to  establish a realignment implementation team. Without such a dedicated group, it is less likely that VA will be able  to ensure that the realignment is managed effectively throughout its  implementation. With regard to the new IT management processes, the department  had begun to take action, but it had not made significant progress at  the time of our report. As of May 2007, it had begun pilot testing two of the new  processes: the risk management process and the solution (that is,  business application) test and acceptance process. If  VA does not continue to address the critical success factors we  identified and develop and implement the new management  processes by their target date, the department may continue to  operate in a decentralized manner and risk not fully realizing the  long-term benefits of the realignment. Improved Processes Planned under the Realignment Are Not Yet in Place for IT Programs and Initiatives

Although IT management has been centralized under the CIO, at the  time of our review, IT programs and initiatives continued to be  managed under previously established processes. The key processes  to be used as the foundation for the realignment had not yet had an  impact on IT programs (specifically, security and inventory  management) or initiatives (such as VBA’s modernization efforts  and VHA’s initiatives on sharing medical data with DOD). Although VA had taken some actions to improve controls over IT  equipment (such as issuing several new policies to establish  guidance and controls for IT security) and had reorganized and  centralized the IT function within the department under the CIO, we  reported that these actions had not yet been fully implemented. As we testified in May 2007, VA and DOD have made progress in  sharing health information, but much work remains to achieve the  goal of a shared electronic medical record and seamless transition  between the two departments. In their long-term initiatives, each  department is developing its own modern health information system  to replace its legacy systems, and they are collaborating on a  program to develop an interface to enable these modernized  systems to share data and ultimately to have interoperable  electronic medical records. Through all these efforts, VA and DOD have achieved exchanges of  health information. In addition, the departments have not yet projected a  completion date for the project as a whole. The department continues to work on improving such programs as  information security and asset control, and it currently has many  significant initiatives under way, for which substantial investments  have been made. Yet we continue to see management weaknesses in  these programs and initiatives (many of a long-standing nature),  which are the very weaknesses that VA aims to alleviate with its  reorganized management structure. However, until the department  provides the foundation for its new IT management structure by  carrying out its plans to establish a comprehensive set of improved  management processes, the impact of this vital undertaking will be  diminished.
Why GAO Did This Study

The Department of Veterans Affairs (VA) depends on information technology (IT) to effectively serve our nation's veterans, with an IT budget of about $1 billion annually. However, it has encountered numerous challenges in managing its IT programs and initiatives. To address these challenges, VA is realigning its IT organization and management to a centralized model founded on a defined set of improved management processes. Begun in October 2005, the realignment is planned to be complete by July 2008. In this testimony, GAO discusses its recent reporting on VA's realignment effort and its management of other IT programs and initiatives, including ongoing systems development efforts and work to share electronic health information with the Department of Defense (DOD). To prepare this testimony, GAO reviewed its past work in these areas.

What GAO Found

VA has made progress in moving to a centralized management structure for IT; however, at the time of GAO's review in May 2007, the department had still to address certain critical success factors for transformation, and it had not yet institutionalized key IT management processes. VA's plans for realigning the management of its IT program include elements of several of the six factors that GAO identified as critical for the department's implementation of a centralized management structure, and it had fully addressed one factor--ensuring commitment from top leadership--having obtained the Secretary's approval of the realignment and the new IT governance structure. However, as of May 2007, the department did not plan to address one of the critical success factors: dedicating an implementation team to manage change. Having such a team is important, since the implementation of the realignment is expected to continue until July 2008. Without a dedicated team, it is less likely that the implementation will be managed effectively. In addition, although the department had begun to take action to establish improved management processes--a cornerstone of the realignment--it had not made significant progress. As of May 2007, it had begun pilot testing 2 of 36 planned new processes. Until it institutionalizes key processes throughout the department, the full benefits of the realignment may not be realized. At the same time that it is implementing the realignment, VA is managing ongoing IT programs such as information security and inventory control, and it is continuing initiatives to develop IT systems. The department is managing these programs and initiatives using existing management processes, many of which display the long-standing weaknesses that VA aims to alleviate through its realignment. Some progress has been made: for example, the department took actions to improve controls over IT equipment, such as issuing several new policies to establish guidance and controls for information security, but because the realignment was not yet fully implemented, improved processes for inventory control had not been established. In addition, progress on the development of a modernized compensation and benefits system occurred after the project implemented improved management processes, which the department now plans to apply to all its IT projects. VA also achieved a milestone in the long-term effort to share electronic health information with DOD, having begun to exchange limited medical data with DOD (at selected sites) through an interface between the data repositories for the modern health information systems that each department is developing. To achieve their long-term vision, VA and DOD have much work still to do (such as extending the current capability throughout both departments), and the two departments have not yet projected a final completion date for the whole initiative. Further progress in VA's IT programs and initiatives could be significantly aided by the improved processes that are the cornerstone of the realignment. Until these are fully implemented, the impact of the realignment on these programs and initiatives is uncertain