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IRS spends $8 Billion. Forgets to Keep Receipts
Somehow, someway, somewhere, the IRS managed to spend over $8 Billion dollars on a business systems modernization over the last several years. (Required government acronym: BSM) What do they have to show for it? Not a lot. I want to make this offer one more time: I will gladly take only $1 Billion from the IRS and in return, I also will provide absolutely no value. This represents a savings of over $7 Billion for the IRS, but they must act now! Operators are standing by.
If you dig into this story a little deeper, (CIO magazine had a great article about this last September) it looks that even though the IRS blames the vendor for the mistake, "...Those familiar with the program say the fault lies largely with the IRS’s entrenched bureaucracy. The agency did not follow its own procedures for developing the new systems and failed to give consistent direction and oversight to Computer Sciences Corp (CSC), the vendor it hired to do the work..."
Aside from the obvious lesson of never working on a project whose initials contain "BS", there are a lot of lessons here for both government and private consultants. Sometimes what people say they want isn't really what they want, and even though it's nice to think of these large organizations as being a kingdom run by the guy at the top, they're more like a bunch of little fiefdoms where sometimes nobody plays together well.
The IRS has tried twice before to modernize their systems and failed, and they're still running code from the Kennedy administration, written in a language few programmers use anymore. If there ever were a case study of how NOT to do a large project, IRS wrote it.
WTF: it's definitely a mess. My purely guestimate opinion of what to do is write a new system, turn off all the switches to the old system, and write-off the lost data and tie-ins. Sure, you will have lost a lot of priceless information and financial feeds, but geesh, you've already spent tens of billions already, perhaps some of this difficult decision-making process is not happening as it should?
The simple fact is that if anybody did a cost analysis of what the current processes at IRS are costing them, it would be a trivial exercise to justify almost any decisive course of action, as long as it was truly decisive and moved the organization in one direction or another. My two cents only.
And for my friends at the IRS who are reading, act now and we'll throw in a pair of ginsu steak knives! A regular $14 Billion value, yours only for an additional $3 Billion.
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