Agencies are leaving billions of dollars on the table because they are consistently duplicating efforts.
The Government Accountability Office’s latest report identifies dozens of areas where overlap exists. Auditors say reducing that duplication could provide $80 billion in additional savings.
But some expect a new law to give that effort a shot in the arm and help deliver more and more savings in the coming years.
The Federal IT Acquisition Reform Act (FITARA), which President Barack Obama signed into law as part of the 2015 National Defense Authorization Act in December, is expected to create new technology and acquisition disciplines across government that could lead to reductions of overlaps and more savings.
David Powner, GAO’s director of Information Technology Management Issues, told the House Oversight and Government Reform Committee that a recent audit found 22 of 24 agencies didn’t have an inventory of their software licenses. He said without an inventory there is no way to understand what the agency is buying, who is using it and how often, and whether they are even getting a good price for the software license.
OMB’s Deputy Director for Management Beth Cobert told lawmakers that’s why software license management is one of the areas under the category management initiative.
“One of the first places to start is having an accurate inventory of software licenses. Software and IT purchasing across the federal government has been highly decentralized, both among inside agencies and components within agencies, as well as across agencies,” Cobert said. “One of the first steps that we are taking as part of our category management initiative around IT is to develop a much more accurate inventory of licenses that exist and the utilization of those licenses today. As the way agencies use software changes, for example as we are succeeding in moving more to the cloud, the ability to have a more consolidated view of licenses becomes much easier and the ability to be smarter about how to manage those licenses, think about what you are paying for those licenses and how to make sure these things are current, used and you are not paying for what you don’t need. The FITARA legislation gives us more authorities in terms of how we get agencies to consolidate and coordinate buying. As we are putting together the guidance for this newly enacted law, this is one of the areas we are focusing on.”
Powner said efforts by the Department of Homeland Security to better manage and consolidate its software licenses saved it tens of millions of dollars, while GAO also found several other examples where agencies found success too.
Update on PortfolioStat progress coming
And it’s not just software licenses, Powner said FITARA will help add more consistency to the PortfolioStat and data center consolidation processes.
GAO and OMB haven’t seen eye- to- eye on the goals of data center consolidation over the last few years. GAO wants agencies to focus on closing data centers and achieving cost savings, while OMB has emphasized better usage of the current servers and space, while pushing savings to a secondary benefit.
But Powner said there is ample opportunity to garner real savings no matter what OMB’s end goals are for agencies.
“We have 9,700 data centers of which about 4,000 are planned to be closed. We’ve accomplished about 1,200 closures to date and about $1.5 billion in savings, but there still is about $6 billion on the table,” Powner said. “When the Comptroller General [Gene Dodaro] mentions $60 billion more in savings, you can get $6 billion from data centers alone.”
Among the areas PortfolioStat measures progress against is data center consolidation as well as other back-office consolidations.
In fact, Powner said GAO will issue a new report on PortfolioStat on Thursday. He said that report will update agency progress against the initial baseline from 2012.
Cobert said at the hearing that agencies already have saved more than $2.3 billion thanks to the oversight and decision-making that come with the PortfolioStat process.
So with all these expectations for FITARA to be what some are calling a once-in- a- career opportunity to change how the government buys and manages IT, OMB busily is developing guidance to implement the first major IT reform law in almost 20 years.
Line of sight for IT spending
Tony Scott, the federal CIO, said earlier in the day at a lunch sponsored by AFFIRM that OMB is working through the agency comments on the draft guidance.
“I think it will be closer to the mid-May, not the end of the year timeframe [for final guidance],” he said. “I think what you will see is I’m planning on doing a cover memo to provide some context, not just for FITARA, but how it fits into an overall context and framework that should be guidance for not just CIOs but the whole organization in terms of how to think about it. It will cover all CXOs. I don’t think you can talk about FITARA in just its own little world. You have to think about it in this sort of broader context.”
Scott said OMB received “some great input” so far from agencies, and his office can see where there is possible confusion around what the law calls for how the guidance will implement those requirements.
He offered no further insights into what the FITARA guidance will cover, however.
While many people have focused on the budget related authorities FITARA gives CIOs, Scott said he believes the biggest impact the law and guidance will have is around aligning views across the agency.
“The first thing is make sure the right governance gets in place in each of the organizations, at both the agency and subcomponent level, and get that right. That’s really where we’ve got to start,” he said. “The law does allow for some customization of that. From an OMB perspective, we are interested in the many variations of what we expect will show up, and it’s a judgment call about whether you think that is going to work right in that particular agency and in that context. I think in the long run, if you get governance right, then you will start to get some of the other things right as well.”
When the alignment isn’t right, Scott said the business suffers. So it’s up to OMB to issues clear rules that are easily understandable and implementable.