U.S. Environmental Protection Agency
                   Office of Inspector General

                   At   a   Glance
                                                              09-P-0206
                                                          August 11,2009
                                                               Catalyst for Improving the Environment
Why We Did This Review

We assessed the capability of
the U.S. Environmental
Protection Agency's (EPA's)
human resources (HR)
management system to provide
the information technology (IT)
support necessary for successful
implementation of EPA's shared
service center (SSC) initiative.

Background

In June 2008, EPA began
consolidating HR transactional
services under three EPA SSCs.
EPA expected the consolidated
SSCs to provide better results at
a lower cost. EPA had
documented the necessity of
upgrades to its HR management
system to achieve these
efficiencies. The Office of
Management and Budget
(OMB) has mandated that
agencies migrate to an Office of
Personnel Management (OPM)-
certified shared service center
(certified SSC) unless an agency
can show that it can maintain its
own operations at a lesser cost.
For further information,
Contact our Office of
Congressional, Public Affairs
and Management at
(202)566-2391.

To view the full report,
click on the following link:
www.epa.gov/oig/reports/2009/
20090811-09-P-0206.pdf
EPA's Human Resources Management System
Did Not Deliver Anticipated Efficiencies to the
Shared Service Centers
 What We Found
The EPA SSC initiative lacked the necessary management controls to achieve
efficiency and effectiveness. In our draft report, we noted that EPA's Office of
Administration and Resources Management (OARM) lacked necessary cost
analysis and OMB approval to upgrade PeoplePlus with an automated workflow
feature in support of the establishment of the EPA SSCs. These actions were
contrary to OARM's own 2007 Business Case Study (Shared Service Center for
Human Resources} that stated EPA needed to upgrade its HR management system
to make the SSCs successful. EPA launched the SSCs in June 2008 before
obtaining the necessary upgrades.  Subsequent to the release of our draft report in
April 2009, EPA changed its approach to achieving anticipated efficiencies at its
SSCs. EPA has determined that it is not cost-effective to update PeoplePlus.
Further, EPA's testing of an automated workflow feature to help improve HR
processing in support of EPA SSCs has proven unsuccessful, causing the Agency,
in part, to abandon the project.

EPA now looks to find an OPM-certified HR Line of Business (LoB) provider who
can provide the required HR IT support. This decision would be in agreement with
the previous recommendation included in our draft report pending a detailed cost
analysis for migration. However, EPA spent considerable time and funds pursuing
the former options. We concur with the Agency's decision to migrate to a certified
HR-LoB provider since it cannot justify upgrading PeoplePlus. However, we
believe that EPA must seek approval from OMB regarding its current hybrid
approach whereby the Agency would retain its current HR personnel who would
use an OPM-certified provider's HR system.
What We Recommend
Going forward, EPA needs to have the appropriate analysis, actions and approvals
in place to ensure the effective management of the Agency's HR function.
Therefore, we recommend that the Assistant Administrator for OARM: (1) obtain
approval from OMB for the level of migration intended by EPA; (2) develop a
baseline cost estimate to determine and secure necessary funding for migration to a
certified SSC; (3) establish realistic milestones with OMB for migration to a
certified SSC; and (4) document the risk of using PeoplePlus until EPA migrates to
a certified SSC.

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