October 19, 2010
by Mickey McCarter
Better management of Boeing would reduce SBInet costs, delays Congressional investigators confirmed Monday what many members of Congress already believed about the virtual fence program at the Department of Homeland Security (DHS): DHS has not provided enough oversight to its prime contractor to ensure projects are on-budget and on-schedule.
The Boeing Co., Chicago, Ill., leads the contractor team tasked with setting up the Secure Border Initiative-Network (SBInet), but DHS management has not managed its activities effectively, charged the Government Accountability Office (GAO) in its report, Secure Border Initiative: DHS Needs to Strengthen Management and Oversight of Its Prime Contractor.
"DHS has largely defined but has not adequately implemented the full range of controls that is reflected in relevant guidance and related best practices and is needed to effectively manage and oversee its SBInet prime contractor," the GAO report read.Later, the GAO report added, "DHS has not effectively monitored the SBInet prime contractor's progress in meeting cost and schedule expectations."
The SBInet program office envisions a virtual fence consisting of sensors and communications equipment mounted on control towers along appropriate areas of the US southwestern border. These towers relay information to central command centers that present a common operating picture to Border Patrol agents in the field. Agents use that information to maintain situational awareness on trespassers and smugglers entering the United States as well as other criminal activity.
But DHS has relied heavily upon Boeing to build and field this system without adequate review processes for contractor deliverables, strong criteria for technical reviews, accurate performance measures for task orders or modifications, or appropriate explanations for contractor anomalies in monthly management reports.DHS concurred with GAO recommendations for improvements in these four specific areas, but it criticized GAO's characterization of errors in the monthly reports on Earned Value Management (EVM), a project management system for measuring the achievements of a contractor.
While DHS has defined and implemented policies and procedures for reviewing and accepting SBInet deliverables and assessing their technical merits, the department has failed to implement other important controls, the GAO report warned. DHS has not adequately documented reviews of contract deliverables, for example, and it has not put its documentation in order before wrapping up technical reviews.The SBInet program office has not produced strong verification and acceptance processes for contract deliverables and it has excluded some deliverables from the review process, the GAO report declared. Also, the office has suffered from insufficient time to review documentation for technical reviews.
"All told, DHS has not effectively managed and overseen its SBInet prime contractor, thus resulting in costly rework and contributing to SBInet's well-chronicled history of not delivering promised capabilities and benefits on time and within budget," the report stated.
Furthermore, DHS could minimize cost overruns and schedule delays if it ensured that Boeing properly implemented EVM controls to identify early warning signs of where the program might go off-course, the report said. DHS has not made certain that Boeing has used timely, completely, or accurately validated performance baselines, which estimate the value of planned work to measure performance. Occasionally Boeing was able to start work on task orders without any baseline at all in place. When baselines were later produced, they did not include all of the work to be performed under the task order, the report said. The baselines also used poor scheduling practices.
Due to anomalies in EVM data from Boeing, DHS has not understood potential cost and schedule pitfalls, thereby limiting its ability to avoid those problems future task orders, the report noted.Although DHS agreed with the four specific recommendations in the GAO report, it objected to criticism of its EVM practices specifically.
In a written response to the report, the department took exception to the statement that shortcomings in EVM data fostered cost overruns and schedule delays.
In particular, DHS said major program changes occurred with SBInet in 2008-2009 after major reviews resulting in changes of scope, schedule, and budget across SBInet."GAO casually observed that the lack of a validated baseline throughout a program review left DHS unable to accurately determine costs and schedules for SBInet, contributing to overruns and delays," DHS wrote. "But DHS argued that the SBInet program office maintained performance measurement baselines throughout the transition period with the best available information, as required by EVM best practices."
While EVM practices will face challenges during significant changes in the course of a program, DHS maintained that it adhered to EVM best practices during that time.DHS also objected to GAO's characterization of routine errors and adjustments in EVM reporting as "anomalies." Some of these adjustments, for example, were the result of estimates of subcontractor work provided by Boeing before the subcontractors submitted their final bills, DHS argued. While Boeing experienced both errors and adjustments in these reports, it has improved them significantly, which has allowed DHS to guide its management efforts effectively, the department said.