Some parts of the federal government have amazingly advanced technology. Many parts don't. As a federal contractor, Orbis Technologies CTO Steve Hamby led a project to modernize how a Defense Dept. system collects, processes, and disseminates tactical intelligence. The infrastructure is dated and expensive to maintain, requiring more than $1 billion each year to run. The processes are written in notebooks or typed in documents on individuals' workstations -- following an undocumented process. The lack of integration of the various subsystems means that operators rely on Microsoft Excel and instant messaging to share information, tools that are not well suited for the task, much less formally part of the process.
Then there was the political wrinkle: The Fortune 500 system integrators that provide the subsystems prefer them to be "black boxes" isolated from each other, as that lets them command more money to support the program. The integrators were none too happy to see their black boxes opened up and the processes figured out and rationalized -- especially by a small technology services contractor.
With persistence and ongoing engagement with the Defense Dept. personnel who operated the system, Hamby's team developed a technology management plan to mature the existing "buzzword compliant" service-oriented architecture, implement enterprise technology management software, and reduce the integration and deployment costs. In the first year, the plan achieved more than $100 million in hardware, software, and integration costs savings, with another $150 million in savings expected over the next four years.
Some of that savings comes from an IT modernization and process management effort. For example, Hamby's team migrated the system from an expensive Solaris Sparc environment to a Windows and Linux private cloud environment using commodity hardware. The rationale for the Sparc environment was to ensure redundancy in each hardware component, and Hamby's team was able to achieve the same redundancy through a cloud architecture that spreads redundancy across hardware components rather than embed redundancy in each component -- at a fraction of the hardware and integration costs.
The adoption of business process management tool, preceded by deriving the actual processes to be automated, let the operators use an industry-standard notation so that they can measure their process effectiveness, efficiencies, and inefficiencies, and possibly improve their processes without program office involvement.
The Internal Revenue Service collects more than $2.7 trillion in annual revenue and processes more than 230 million tax returns. To do this, the agency relies on its information technology systems that over the years became more complex. Legacy core tax processing systems developed in the 1960s, huge transaction rates each year into the billions, and an increasingly large, complicated, and ever-changing tax code exemplify the intricacy of the IRS IT environment.
The legacy drag was stupefying: Tax data was stored in flat, sequential files rather than in a database. Assembly language was the predominant language for Individual Master File (the master database) processing and financial systems. And the systems ran in weekly batches. These conditions had been in place for more than 50 years, along with obsolete practices not found or expected in current IT environments.
Modernization of the IRS's IT systems began in 1998, but progress was slow and full scale not yet attained a decade later. So in 2008, IRS Commissioner Douglas Shulman set a new direction and faster pace for technology changes. A new program launched that would pervade organizational boundaries and change traditional operating models. Named the CADE 2 (Customer Account Data Engine 2) Program, the 2012 filing season marked its delivery target.
Previous efforts to modernize IRS system produced only incremental progress, so strong resistance confronted the idea that change was possible. Dramatic changes in human resources and organizational processes became critical to the program's success.
The technology challenges were nothing to sneeze at either: Building a new database was a key challenge -- not in terms of size, as larger databases do exist, but the combination of size needed to accommodate 140 million individual taxpayers each year with inevitable changes that affect that number, plus the complexity of the shifting tax code. The variations affected more than 70 systems, roughly one-third of all tax processing applications.
Under extremely short timeframes, a 2,400-person organization led by Kate Miller, associate CIO for applications development, stood up to build the new database, completing its design, development, and testing all in parallel with normal preparations for the 2012 filing season.