By Jory Heckman
Federal News Radio

Agencies on the fence about modernizing their federal financial systems now have some guidelines to help them decide whether to go ahead.

The American Council for Technology and the Industry Advisory Council (ACT-IAC) have delivered recommendations on federal financial management to the Office of Management and Budget (OMB).

OMB “did make a very specific request, and they had very specific questions they were looking for answers on,” said Andrew McLauchlin, vice president at CGI Federal, executive director of the CGI Institute for Collaborative Government and co-chair of the Federal Financial Management working group of ACT-IAC, in an interview with Federal News Radio’s Federal Drive “In this case, we were really able to assemble quite an A-team of 22 different [IAC member] companies coming together to take off their company hats and focus on what’s the right thing for government, [and] analyze the problem.”

The working group specifically addressed how agencies can most effectively maintain functionality and improve performance of their financial systems over time. The group also looked at how and when agencies should invest in modernizing a system on its “last legs,” and how to get the most out of new technologies when agencies finally acquire them.

McLauchlin said the working group succeeded in creating “a very specific decision framework that could be applied within agencies, complete with a spreadsheet that people could use – not to pop out a magic answer, but to help make an informed decision.”

Of the points the group decided on, ACT-IAC advised managers that hybrid environments – ones that gradually implement modern systems while continuing with the existing legacy system – can be more cost-effective than an agencywide change in operations. Overall, ACT-IAC said in its report that agencies should make investment decisions based on the capabilities it needs before considering any specific systems.

The report also provided agencies with a standardized decision framework to evaluate whether a legacy system is outdated and needs to be replaced. When agencies want to keep a legacy system in place, the report outlines a three-stage plan to optimize, offload and host the system.

If the agency cannot improve system performance, the report states they should consider migrating the system to a specialized department or third-party host, and then shutdown the legacy system.

The ACT-IAC also examined the steps that agencies need to go through for software upgrades. The report outlined a plan to keep executive leadership and managers in constant communication with vendors about the agency’s changing requirements and new functionality it needs to achieve them. OMB has paid particular interest on this issue. In June 2010, OMB shutdown all modernization for financial management systems in order the review the process.

ACT-IAC suggested agencies set a time schedule for upgrades every one to three years.

In the report’s final point, ACT-IAC advised agencies to find ways to maximize the benefit gained from adapting to new technologies.

The report recommends agencies use mobile technology and social media as a way to collaborate on projects within the agency.

The ACT-IAC also looked into OMB’s “cloud first” initiative and determined that not every agency may be suited for cloud computing.

Some agencies, such as the Defense Department still may prefer to rely on its in-house system because of security issues.

McLauchlin said that there is no effective date for any of these recommendations.

“I’d say it’s really more that these ideas have been put forth – that we’ve shared them with OMB. We’re really in a socialization and discussion phase to make the agencies know of the ideas and can consider implementing them in their operations,” he said.

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Jory Heckman is an intern with Federal News Radio.

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