OPM awards major HR IT modernization contract to Oracle - Federal News Network

The nearly $400 million, 10-year contract is expected to deliver a single, governmentwide system for agencies to manage their human resources capabilities. The Office of Personnel Management awarded a nearly $400 million contract to Oracle on Wednesday, as part of ongoing efforts to launch a governmentwide IT platform for agencies to manage their human resources capabilities. The vendor is expected to deliver a consolidated, secure, cloud-based HR platform that all federal agencies will eventually use to manage personnel functions, such as payroll, benefits and employee performance. “This becomes the centerpiece for how we create effectively a unified set of applications that every federal employee can follow from cradle to grave,” OPM Director Scott Kupor said in an exclusive interview with Federal News Network. “The opportunities are endless — what this does is basically drive an enormous amount of self-service, and more importantly, the ability for us to actually be able to make the employee experience much more seamless.” For decades, agencies have used disparate systems to manage various HR services. Governmentwide, there are currently 119 different IT platforms in use for managing agencies’ HR functions.         Earn CPE credit: The latest webinar from the Billington CyberSecurity Cyber and AI Outlook Series will focus on the real-world risks facing AI deployments across the federal landscape. Register now! “Many are outdated and duplicative,” OPM said Wednesday in a press release. “Fragmented systems lead to delays and errors in personnel processing, leading to unnecessary costs and hurting the government’s operational efficiency.” The Trump administration has been putting together plans to consolidate those 119 systems into one — a long-time goal for the federal government. The initiative is expected to reduce costs to taxpayers by more than 90%, according to OPM. The agency said the consolidated platform will streamline HR operations and improve data quality. “Rather than 119 different versions of the same data field or the same capability, we are at OPM going to account for agency-specific flexibilities, but also drive standardization and consistency across the federal employee and practitioner experience,” Jason Parman, OPM’s principal deputy associate director for HR Solutions, said in an interview with Federal News Network. “Hitting the go button enables us to leverage that vendor partner, which will have all of their demonstrated capabilities, all of our fit-gap requirements worked out and all those configurations ready, so that agencies can effectively and rapidly transition to the new platform.” OPM chose Oracle over Workday for the 10-year contract. Workday will have 10 days following its debrief to file a protest, if it chooses. OPM had initially awarded a task order to Workday in May 2025, only to withdraw the contract a few days later. “Oracle is honored to partner with OPM to establish a secure, trusted foundation to unify federal HR operations,” Kim Lynch, Oracle Government’s executive vice president for defense and intelligence, said in a press release Thursday. “And in doing so, we’re extending our commitment to help government leaders make faster decisions while delivering to federal employees the modern experience they deserve.” Workday did not respond to Federal News Network’s email seeking comments on the award. OPM last year issued a request for proposals (RFP), seeking a 10-year contract for delivering the governmentwide HR IT system. The administration initially set a target launch date for July 2027, but that timeline will likely be pushed back by at least six months. Although OPM intended to award a contract by January 2026, the award was delayed by several months due to bid protests from two major tech companies that did not make it to the final contract award stage.          so you never miss a beat on all things federal “It’s always hard to predict these things, but the team has done an incredibly thorough process,” Kupor said. “We’ve been using this delay that we had to make sure that all the prep work that we could do with all the agencies is up and running. Our hope is to be able to actually deliver on behalf of the American taxpayers. If things come up that delay, we’ll deal with it as they come, but I’m highly confident in the work the team has done and our ability to successfully defend any challenges to this process.” At the same time, many former federal executives have said a single-award approach for a project of this scale will be challenging to get across the finish line. Other agencies have failed at similarly large single-award programs, due to either protests or implementation issues. The Defense Department’s cloud program called JEDI collapsed under the weight of protest, while several financial management consolidation attempts at the Department of Homeland Security struggled in the implementation phase for years. “We have tried to be students of history as much as we can here and understand exactly where the pitfalls are,” Kupor said. “It’s obvious we should do it, but that doesn’t necessarily make it any easier to take on a task of this Herculean size.” To get ahead of potential challenges, OPM has been working with other agencies, as well as the Office of Management and Budget, on months of preparation work for the major modernization undertaking, Kupor said. OPM also set up several committees and working groups to prepare from various perspectives, including data governance, security and HR — and is anticipating customization requests from different agencies. Following the contract award this week, OPM said it will be working with “phase one” agencies on the first steps toward onboarding them to the new system, including data migration. “We’re going to literally start fanning out to the phase one agencies who are on the list to basically be able to be the first deployment agencies for the system,” Kupor said. “We’re going to be hard at work — no longer dealing with procurement, but actually the first phase of implementation of this system.” The first wave of agencies is expected to be onboarded to the new HR IT platform in the early parts of fiscal 2027, or possibly sooner. “We’re optimistic about what we’ve seen thus far, what we’ve evaluated with the platform capabilities and our ability to configure and deploy this at scale with speed,” Parman said. The HR IT consolidation effort is a major part of the Trump administration’s “Federal HR 2.0” initiative, which OPM announced last year. As part of the same initiative, OPM in March launched a new HR shared service center — which gives agencies the option to enter into an interagency agreement with OPM to receive access to a suite of “vetted” IT tools meant to streamline human capital management capabilities.