“perform and complete the planning needed to serve as the basis for funding the development and implementation of the computerized loan monitoring system, including— (1) fully defining the system requirement using on-line, automated capabilities to the extent feasible; (2) identifying all data inputs and outputs necessary for timely report generation; (3) benchmark loan monitoring business processes and systems against comparable industry processes and, if appropriate, simplify or redefine work processes based on these benchmarks; (4) determine data quality standards and control systems for ensuring information accuracy; (5) identify an acquisition strategy and work increments to completion; (6) analyze the benefits and costs of alternatives and use to demonstrate the advantage of the final project; (7) ensure that the proposed information system is consistent with the agency’s information architecture; and (8) estimate the cost to system completion, identifying the essential cost element.”
The act also required SBA, within 6 months of enactment, to submit a report to the Congress and to us on its progress in carrying out these mandated actions. SBA’s Project Plan for Completing the Mandated Actions

SBA’s project plan provides information in many key areas to explain how it intends to complete the mandated actions. The plan delineates the project’s goals and objectives, resource requirements, quality standards and control systems, assumptions, methodologies, work breakdown structure with a timetable for completion of tasks, and estimated costs. According to the project plan, SBA’s strategy for achieving these goals is to build on “best industry practices,” reengineer inefficient business processes, and implement contemporary technologies. SBA included estimates of the personnel resources that it would need to execute the project plan. It estimated that 18 staff would be needed for the first phase of the project, which addresses the completion of the mandated actions, and that an additional three staff would be needed for the development phase. To address the quality standards and controls to be used for the loan monitoring system project, the plan includes work elements to establish systems development standards and procedures and process change control procedures. The plan recognizes that the project includes a number of assumptions that may affect its success. It identifies seven key assumptions that SBA made but will need to validate during the project. The project plan also cites the methodologies that SBA plans to use or is considering for key areas of the project. According to the project plan, SBA estimates that the loan monitoring system will cost about $20 million to complete. Challenges and Risks in Executing SBA’s Project Plan

While developing the project plan is a good start, SBA must still successfully execute it to complete the eight mandated actions. Establishing Software Project Management Capability

SBA recognizes the need to establish defined processes for software project management and use them on this project. Using Methodologies and Practices for the First Time

The loan monitoring system project team will be using, for the first time, methodologies it has selected for benchmarking, business process reengineering, information technology architecture development, project management, and systems development. Implementing the Project Without an Information Technology Architecture

SBA plans to work concurrently on an information technology architecture and the loan monitoring system as separate projects. In conclusion, the extent to which SBA meets these challenges and manages these risks will determine how well business processes and systems requirements are defined, and the quality of support for decision-making on the purchase or development of the needed system.
Why GAO Did This Study

GAO discussed the Small Business Administration's (SBA) activities to complete planning for its loan monitoring system, as required by the Small Business Reauthorization Act of 1997, focusing on SBA's project plan for completing the mandated actions.

What GAO Found

GAO noted that: (1) SBA's project plan provides information in many key areas to explain how it intends to complete the mandated actions; (2) the plan delineates the project's goals and objectives, resource requirements, quality standards and control systems, assumptions, methodologies, work breakdown structure with a timetable for completion of tasks, and estimated costs; (3) according to the project plan, SBA's strategy for achieving these goals is to build on best industry practices, reengineer inefficient business processes, and implement contemporary technologies; (4) in support of these goals, SBA also established objectives for the loan monitoring system; (5) SBA included estimates of the personnel resources that it would need to execute the project plan; (6) it estimated that 18 staff would be needed for the first phase of the project, which addresses the completion of the mandated actions, and that an additional three staff would be needed for the development phase; (7) to address the quality standards and controls to be used for the loan monitoring system project, the plan includes work elements to establish systems development standards and procedures and process change control procedures; (8) the plan recognizes that the project includes a number of assumptions that may affect its success; (9) it identifies seven key assumptions that SBA made but will need to validate during the project; (10) the project plan also cites the methodologies that SBA plans to use or is considering for key areas of the project; (11) according to the project plan, SBA estimates that the loan monitoring system will cost about $20 million to complete; (12) while developing the project plan is a good start, SBA must still successfully execute it to complete the eight mandated actions; (13) in executing the plan, SBA will face formidable technical and management challenges and risks; (14) SBA recognizes the need to establish defined processes for software project management, and use them on this project; (15) the loan monitoring system project will be using, for the first time, methodologies it has selected for benchmarking, business process reengineering, information technology architecture development, project management, and systems development; (16) SBA plans to work concurrently on an information technology architecture and the loan monitoring system as separate projects; and (17) the extent to which SBA meets these challenges and manages these risks will determine how well business processes and systems requirements are defined, and the quality of support for decisionmaking on the purchase or development of the needed system.