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GAO Testifies Regarding Ailing IT Investments

GAO’s David A. Powner, Director Information Technology Management Issues, testified before the Senate subcommittee on Efficiency and Effectiveness of Federal Programs last week that $1.4 billion worth of federal IT investments are in peril and another $8.6 billion need attention.

Powner stated before the subcommittee under the Senate Committee on Homeland Security and Governmental Affairs that according to the OMB IT Dashboard 183 federal investments are in jeopardy, equating to $10 billion.  “OMB and agencies need to aggressively govern these at-risk investments using TechStat sessions and other governance mechanisms,” Powner said.


Last month, Powner appeared before the entire Senate Committee for Homeland Security and Governmental Affairs on Identifying Critical Factors for Success in IT Acquisition to offer insight into best practices and reform initiatives that can help improve IT investment management.  Expanded use of critical success factors in IT acquisition, such as active stakeholder engagement and support from agency executives, along with further implementation of government and industry best practices, will better position agencies to more effectively deliver mission-critical systems, according to GAO.

The IT Dashboard, launched by OMB, has been one key reform issue.  The IT Dashboard was meant to help mitigate risk in federal IT programs and it has increased visibility and garnered success.  However, it has its weaknesses.  GAO issued a report in 2011 which voiced concerns about accuracy and reliability of dashboard data, but also pointed out that data was improving over time.  Recently, GAO reported that agencies had removed major investments from the dashboard which raises concerns about transparency.  Additionally, GAO noted that the timeliness of updates to the dashboard was lacking.  As of December 2013, the public version of the dashboard was not updated 15 of the previous 24 months.

Powner also cited OMB recommendations for increased incremental development, but GAO’s recent findings indicate that almost 75% of investments reviewed did not plan to deliver capabilities every six months and less than half planned to deliver capabilities in 12 month cycles.

In recent reports, GAO has also offered recommendations for PortfolioStat efforts.  PortfolioStat requires agencies to conduct annual reviews of their IT portfolios and make decisions about eliminating duplication.  This initiative has the potential to save $5.8 billion through FY 2015, however weaknesses exist in the implementation of the initiative across agencies.  One implementation issue revolves around CIO authority.  

With over $80 billion in federal IT spending per year, it’s incumbent upon agencies and the administration to learn from successful IT implementations, as well as failed projects.  While use of best practices, legislation, and OMB efforts at transparency and oversight have improved IT execution and spending, continued leadership and attention is necessary to build on current progress.


Federal Agencies Lag in Software License Management per GAO

Federal agencies spend more than $80 billion on IT each fiscal year, much of it on software licenses. Given budget pressures, the effective management of the thousands of software licenses could result in significant economies and budget savings. But a new Government Accountability Office (GAO) report shows that agencies have a long way to go in effectively managing software.

In a recently published report, GAO found that the majority of agencies have some software license management policies, but they are not comprehensive. Further, OMB has not established directive policy guidance on licensing management policy. Therefore, GAO assessed agencies based on seven elements that they identified that a comprehensive software licensing policy should specify (emphasis added):

  • Identify clear roles, responsibilities, and central oversight authority within the department for managing enterprise software license agreements and commercial software licenses;
  • Establish a comprehensive inventory (80 percent of software license spending and/or enterprise licenses in the department) by identifying and collecting information about software license agreements using automated discovery and inventory tools;
  • Regularly track and maintain software licenses to assist the agency in implementing decisions throughout the software license management life cycle;
  • Analyze software usage and other data to make cost-effective decisions;
  • Provide training relevant to software license management;
  • Establish goals and objectives of the software license management program; and
  • Consider the software license management life-cycle phases (i.e., requisition, reception, deployment and maintenance, retirement, and disposal phases) to implement effective decision making and incorporate existing standards, processes, and metrics.

GAO reviewed 24 agencies’ policies on software license management against these seven elements and gave each a composite assessment. (See table below.)

Composite GAO Assessment of 24 Agencies’ Policies on Managing Software Licenses


? Fully—the agency provided evidence that it fully addressed the seven elements of a comprehensive software license policy.

? Partially—the agency provided evidence that it addressed some, but not all, of the seven elements of a comprehensive license policy.

? Not—the agency did not provide any evidence that it addressed any of the seven elements of a comprehensive license policy.

Only two agencies – DHS and Labor – have developed comprehensive policies for managing software licenses. At the other end, four agencies – Commerce, HHS, Interior, and NSF – had not developed any department-wide policies for managing software licenses. The rest fell in between.

GAO recommended that OMB issue a directive to the agencies on developing comprehensive software licensing policies comprised of the seven elements identified by GAO. OMB’s existing PortfolioStat and Strategic Sourcing initiatives give leeway to agencies to determine what priority software licenses receive in the reviews, which means much more could be done on software efficiencies.


GAO noted that the wide variance in the form and completeness of data provided by agencies regarding their most widely used applications made it impossible to accurately determine the most widely used software applications across the government, including the extent to which these were over and under purchased.

Further, the limited or outright lack of agency oversight of software license spending means they are likely missing significant opportunities to save money. GAO noted some positive examples, including where DHS’s negotiated enterprise licensing agreements led to cost avoidance of $181 million in FY 2012. Further, DHS estimated future savings of around $376 million from FY 2013 to FY 2015. Extrapolated across all departments, that could free up billions of dollars in savings each year to be reinvested in other areas of IT or repurposed to other missions. 

Originally published in the GovWin FIA Analysts Perspectives Blog. Follow me on Twitter @GovWinSlye.