IBM wins $123 million HR contract for U.S. gov't

The U.S. Department of Veterans Affairs wants to replace its 50-year-old human resources application with a sleeker software-as-a-service model.

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Retired U.S. Army Command Sgt. Maj. Sterling R. Cale, 90-year-old Pearl Harbor survivor, on Memorial Day 2012. (U.S. Dept. Veterans Affairs)

This morning, the U.S. Department of Veterans Affairs awarded IBM with a 10-year, $123 million contract to replace its 50-year-old (!) human resources application with an updated, software-as-a-service version.

The deal will require IBM to build, operate and maintain the new HR system, which will be deployed across the enterprise, to some 300,000 employees, by the end of 2015. The system will incorporate Oracle PeopleSoft, Monster Government Solutions and IBM's Rational, InfoSphere and Tivoli products.

Aside from the expected benefits of an SaaS deployment—standardization, flexibility—the VA wants to create self-service options for its managers and employees. It also wants to reduce costs by consolidating HR processes into one geographic location.

(What, you didn't think cost savings was part of it? This is the government we're talking about here.)

This year, IBM will design, develop and test the new system; it will begin deployment in January 2014.

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