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

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

Summary: 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.

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.

Topics: Government, Enterprise Software, IBM

Andrew Nusca

About Andrew Nusca

Andrew Nusca is a former writer-editor for ZDNet and contributor to CNET. During his tenure, he was the editor of SmartPlanet, ZDNet's sister site about innovation.

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  • 50-year-old application?

    It would be interesting to find out what that was.
    William Farrel
    • 50 Year Old App

      It was Called PAID, and it was homegrown a looooooooooooooong time ago.
      VA Employee
    • COBOL, Fortran, Pascal... who cares?

      It was outdated, but this foreplay with sticker shock is going to lead to one heck of a proverbial STI...
    • Hi

      I agree. Any update about this post? What is the latest happening? I am looking forward to read more of this.

      Koby from Human Resources
      Koby Parsons
  • What a waste of taxpayer money

    More leasing garbage that costs more in the long run and, as with anything leased, the renter has nothing to show for the investment!!

    Building a new app one owns also means there's no external influence that can pull the plug, or hold the one leasing out for more money. Extortion and exploitation are cool.

    And remember, Microsoft and other companies that offshored source code are now begging or demanding the government step in to thwart multinational piracy... and you wonder why people are so cynical nowadays???

    Simple economics.
  • No mention of integration

    In ERP, including HR, integration with your other ERP components, such as finance, is important. PeopleSoft HR integrates with nothing except PeopleSoft Financials because Oracle has stopped new development on PeopleSoft HR. Oracle is developing Oracle HR. How to plan, budget, and keep track of salary dollars? Hire a lot of data input clerks to type information into your financial system. Government inefficiency at its best.