Audit of the FLITE Strategic Asset Management Pilot Project

This audit assessed how well FLITE program managers were managing the SAM pilot project to ensure the achievement of cost, schedule, and performance goals; the accuracy, completion, and timeliness of deliverables; the proper management of risks; and the effectiveness of organizational change management (OCM) efforts. On July 12, 2010, VA made a decision to terminate the FLITE program with the exception of the SAM pilot, beta, and national deployment projects. Due to shortfalls in program staffing, guidance, training plans, and contractor oversight, FLITE program managers did not effectively control project cost, schedule, performance, and ensure timely deliverables. As a result, VA is considering extending the SAM pilot project by 17 months (from 12 to 29 months), potentially more than doubling the original contract cost of $8 million. Some of the cost, schedule, and performance issues could have been avoided if program managers had ensured adequate contractor involvement and effective processes to identify and manage risks associated with the pilot project. Further, because of the failed CoreFLS program and the lack of progress made on the SAM pilot project, OCM officials are struggling to gain stakeholder acceptance. We recommended the Assistant Secretary for Information and Technology and the Executive Director, Office of Acquisition, Logistics, and Construction establish stronger program management controls to facilitate achieving cost, schedule, and performance goals, as well as mitigate risks related to the successful accomplishment of the SAM project. Department leadership recently increased its scrutiny of FLITE management and placed additional project contracts on hold. Unless improvements are made, the outlook for the SAM pilot project remains tenuous. The Principal Deputy Assistant Secretary for Information and Technology and the Executive Director, Office of Acquisition, Logistics, and Construction agreed with our findings and recommendations and plan to complete corrective actions by November 2010. We will monitor implementation of the planned actions.