December 21, 2012

Naval Reactors Information Technology System Development Efforts

Our review identified continuing system development issues related to the Enterprise Business System (EBS).  In particular, we found that neither Naval Reactors Program (Naval Reactors) officials nor the project contractors had adequately considered the use of a commercial-off-the-shelf product prior to upgrading and modernizing the financial components of EBS.  Specifically, the project team was unable to provide any formal analyses or justification for developing the system in-house.  In addition, the EBS project had not been reported to the Department of Energy (Department) and the Office of Management and Budget (OMB) as a Major Information Technology Investment, as required.  Specifically, despite spending approximately $10 million of the budgeted $12.8 million for the procurement phase of the EBS development effort, officials had not submitted the required budgetary information to the Department or OMB, an action that could have allowed for improved performance monitoring.  

The weaknesses identified were due, in part, to the lack of adherence to Federal and Naval Reactors policies and procedures.  In addition, we noted that a lack of a coordinated effort between the project stakeholders and team members likely contributed to project delays and cost increases.  Without adherence to appropriate system development requirements, future information system development efforts may experience problems similar to those identified in our report related to project management and result in schedule delays and cost overruns.  Management generally concurred with the report's recommendations and indicated that it will take action to address our recommendations.

Topic: Management & Administration