Deltek Forecasts Growth in the Federal Big Data Market

Key Takeaways

• Federal spending on big data solutions and services reached a new high of $5.4B in FY 2020.
• Agencies are increasingly leveraging advanced analytics solutions for mission-related purposes and not just for research and development.
• Data governance structures, as well as a growing data-centric mindset at federal agencies, supports higher spending in the years to come.

The importance of data is frequently in the news thanks to the evolution of new tools that are making it easier to leverage data for decision making. Like private industry, federal agencies are also investing heavily in advanced analytics, data mining, visualization, and other solutions that will enable them to take advantage of the vast stores of data they hold. This investment reached a new high of $5.4B in FY 2020.

Technology alone, however, is not the only factor driving growing federal spending on so-called “big data” solutions and services. White House policy, numerous pieces of legislation, and the ever-shifting cyber threat are putting pressure on agencies to modernize their technology environments. As agencies decommission and/or replace legacy systems it will free up even more data in need of analysis. It is no exaggeration to state that agencies are drowning in data.   

Investments in big data solutions, therefore, is no longer centered only in agencies with scientific missions or those concerned with research and development. Advanced analytics, robotic process automation, and similar solutions are rapidly being integrated into ordinary agency operations, such as financial management, logistics, fraud detection, personnel management, and facilities management. This penetration of big data solutions deeper into agency operations is expected to continue as modern networks, computing infrastructure, and end-user devices blend into seamless environments.

Deltek analyzed the data surrounding the federal big data market, concluding from it that converging forces will drive growth in federal spending on commercial big data solutions and services from $6.1B in FY 2021 to $7.5B in FY 2023 at a Compound Annual Growth Rate (CAGR) of 11.4%.

Other key findings from Deltek’s report include the following:

• Data-Centric Policies. Key policies such as the Evidence Act and Federal Data Strategy have set the foundation for data governance maturation across the federal government.
• Chief Data Officers. Chief Data Officers and data management specialists are now commonplace across federal agencies, holding increased sway over data investments including advanced analytics and machine learning.
• Common Agency Challenges. Agencies continue to face challenges with unstandardized data locked in legacy systems, and a lack in data-driven culture and skill sets.
• Influence of Emerging Technologies. Growth in quantum, exascale, AI and machine learning technologies will increase data collection, use and dissemination among agencies, driving a need for effective data management, storage and access.
• COVID-19 Impact. The COVID-19 pandemic is poised to have long-term implications on federal big data practices, particularly highlighting the need for solutions to make critical national data discoverable and interoperable.

For additional insight please see Deltek’s Federal Big Data Market, 2021-2023 report.