I want to note that while a high level of software competence is certainly a requirement to develop a large, complex system such as TSM, so too is a similar level of system engineering. Our reports have fairly shouted, so far to no avail, that an overall plan and standards must be in place to guide the designers in creating software and other components, and is absolutely necessary for good design. An overall plan and standards will provide for the integration and testing of all the systems included in TSM. I would like to suggest that progress in this regard be required in the bill as well, to avoid neglecting system engineering in the process of focusing on improving software development. There is a Systems Engineering CMM that has been in use since 1994 that should be used by the IRS as well.

Finally, I would like to raise two points. The first is that the attainment of levels or milestones required in the bill should be certified by some body outside the IRS. The second is that a group similar to the Control Board, but with technical expertise, be set up to monitor and approve the technical progress of TSM. In its last report, the NRC committee clearly stated that the IRS must acquire greater technical insight and technical management capabilities internally; the public administration problem is how to make that happen, and an appropriately constituted body may be a useful vehicle.

Thank you, Mr. Chairman. I would be happy to try to answer any questions.

* Technical Report CMU/SEI-94-TR-13, Benefits of CMM-based Software Process Improvement Initial Results, August 1994. Some of the organizations in this study are Motorola, GTE Government Systems, Hewlett Packard, Hughes Aircraft, IBM Federal Systems, Northrop, Texas Instruments, Tinker AFB Air Logistics Center, Fleet Combat Direction Systems Support Activity. By the end of 1994, CMU had data on 40 organizations that had reached level 3. CMU is also aware of a few that have reached level 5. This data is very incomplete: there may be many more organizations at level 3 and above which have not sent their data to the SEI.

TESTIMONY OF MR. JOHN GIOIA
Chief Executive Officer of Robbins-Gioia, Inc.

before the

COMMITTEE ON GOVERNMENTAL AFFAIRS
UNITED STATES SENATE

September 10, 1996

Mr. Chairman, Members of the Committee, thank you for the

opportunity to testify before you today about Tax System

Modernization (TSM) and the importance of program management to

any successful systems acquisition by either federal or commercial markets. I have reviewed the Internal Revenue Service's (IRS) report to congress dated May 9, 1996, and the General Accounting Office (GAO) report on this subject dated June, 1996.

The IRS appears to understand the importance of recovering from its current management dilemma to an environment that better controls risk, which better ensures that performance targets are met and costs are controlled. The IRS also seems to recognize that

implementation of the current or any plan represents their greatest

Filename: TEST_4.DOT

Page 2

Version: 9/6/96 (9:48 AM)

challenge. Critical to implementation is the agency's ability to

improve its program management infrastructure to better focus its core competencies. There are some notable improvements to their plan that I think can be incorporated to increase the chances of program success. I have a background in major system program management, both in my former occupation as a Colonel in the United States Air Force, and today as Chief Executive of a company whose business is exactly this field. The suggestions I offer are ones that certainly can apply to TSM, but also to any major system

acquisition initiative the government pursues, whether these be at the

Patent and Trademark Office, the Bureau of the Census, or the
Justice Department.

You asked me to focus on three topics:

Transfer of TSM Responsibilities To A Prime Contractor

Mechanisms To Correct Management Deficiencies

Establishment of An Independent "Board of Directors" To
Oversee Management of TSM

Filename: TEST_4.DOT

Page 3

Version: 9/6/96 (9:48 AM)

I will address all of these, although not in the order you outlined in

your letter to me. I will address the establishment of an independent

Board first and for a very important reason. If I could leave this

committee with one message it would be that a management Board, with all stakeholders at the table, for purposes of program

management and dispute resolution, can be the greatest contributor to the success of TSM or any large system acquisition.

Such a Board is a management mechanism. It is a mechanism that

has all the checks and balances essential for success. And it is precisely the absence of such a mechanism that causes the

government so much difficulty and costs the taxpayer so many more billions of dollars than necessary, in fashioning the technology solutions it requires.

To the government's credit, it is only in today's environment that such

a structure can operate. Until February of this year, the procurement system has focused on the acquisition process, with the need of the government almost a secondary consideration. In February,

President Clinton signed legislation authored by Senator Cohen, with

Filename: TEST_4.DOT

Page 4

Version: 9/6/96 (9:48 AM)