IT Integration: The Army’s Pay Misstep

Army reserve staff Sgt. Ryan Kelly was still recovering from his Iraq War wound—an amputated lower right leg—in Abilene, Texas, when he received a disturbing note with his pay stub: The Army said it had overpaid the 23-year-old soldier 22 days’ salary, and that he owed the Army $2,231. That’s because even though he was medically retired in early August 2004, the Army recognized him as an active duty soldier for all of August, according to Kelly, and deposited the usual monthly pay into his bank account.

For the next year and a half, Kelly, a civil affairs specialist with the Army Reserve, and his wife, Lindsey, a second lieutenant with the Army, navigated their employer’s labyrinthine bureaucracy in an attempt to make good on the debt. Kelly, who spoke to Baseline from his home in Prescott Valley, Ariz., says that the experience was “a big stress.”

The Army, which acknowledges its pay problems, says it does not know how many soldiers in its ranks have had similar experiences. But a fall 2005 Army audit estimated that of 24,000 regular Army, Reserve and National Guard soldiers wounded in action or evacuated for medical reasons in Iraq and Afghanistan, 14% were mistakenly overpaid or underpaid, or their cases required further research to determine if their pay was inaccurate. Many overpaid soldiers, like Kelly, were not aware of the pay mistakes until they received debt notices or stopped receiving their salaries altogether, according to the Government Accountability Office (GAO).

As of Sept. 30, 2005, the Army claimed $1.5 million in overpayments to 1,300 soldiers killed or injured while fighting in Iraq and Afghanistan, according to a late April GAO report. Soldiers were erroneously overpaid due to mix of human and information systems errors, the report found.

Kelly’s pay problems, as with many of his wounded comrades, arose when information in the pay systems lagged behind actual events.

Stories of injured soldiers with pay problems have made headlines, but they represent a subset of a more expansive set of problems that have affected an unknown number of non-injured soldiers. Those men and women have been overpaid and underpaid at each stage of the combat deployment and redeployment process for dozens of reasons, says the GAO.

“It’s a terrible injustice,” says Rep. Todd Russell Platts (R-Pa.), chairman of the House Subcommittee on Government Management, Finance and Accountability, which holds regular hearings to review findings and recommendations published by the GAO. “These soldiers are truly going into harm’s way in defense of our nation and of our citizens,” he says.

The Army’s pay missteps will sound familiar to many information-technology executives who have faced the problem of integrating legacy information systems.

While the complications stretch across at least a dozen payroll and personnel systems maintained by the Army, the problems experienced by the Reserve have been the most scrutinized by the GAO.

The Army has been working for five years to make two key systems— payroll management and personnel— communicate so it can pay reservists called up for combat duty.

The payroll application, called the Defense Joint Military Pay System-Reserve Component, generates the salaries and other financial allowances and benefits for 200,000 current reservists. The Army adapted the custom-built mainframe application in the early 1990s from a payroll application the Air Force developed in the 1970s.

The personnel system, called the Regional Level Application Software system, keeps track of the personal and professional information of reservists—when they participate in required weekend and annual drills, and the skills they acquire. The Web-based system is also used to see where and for how long soldiers are activated for combat service.

The systems need to communicate because the pay transactions processed in the payroll system are based on soldier deployment, marital status and other information that is initially entered into the personnel system.

But the two systems have never been completely integrated. And while the Army has made improvements, some problems persist.

The Army is now looking to a new integrated armed forces system, called the Defense Integrated Military Human Resources System. However, that system, in which the Defense Department has invested more than $300 million since 1998, is three years behind schedule due to, among other reasons, being managed by multiple agencies and a lack of consistent senior management support, says Paul Brinkley, Deputy Undersecretary of Defense for Business Transformation.

“The turnover in leadership created a lack of awareness and understanding of the goals of the program,” Brinkley says. His agency operates under the Defense Department and is charged with creating the organizational and business conditions to implement technology effectively.

The new system, which will share information with 500 other defense applications, is supposed to be a single, fully integrated program that handles all personnel and pay functions, according to Kent Schneider, president of Northrop Grumman’s defense consulting group, the project developer and integrator. The government selected Oracle/PeopleSoft software as the foundation of the unifying application, which will replace 79 legacy systems across the military. “The goal is to ensure changes are processed as quickly and as error-free as possible,” Schneider says. “All this complexity means opportunities for errors. We want to make sure the system is as simple and easy to use as possible.”