Of the total reported data centers, 242 were reported by agencies as  “core” data centers—meaning that they are primary consolidation points  for agency enterprise IT services and not planned for closure, while the  remaining 9,416 were reported as “non-core.”memorandum states that the goal is for agencies to close 40 percent of  the total non-core data centers, or 3,766 data centers based on the May  2014 inventory data, by the end of fiscal year 2015. Pursuant to this goal, agencies have  reported achieving more than a billion dollars in savings and avoidances  through fiscal year 2013 and are planning a total of about $3.3 billion in  savings and avoidances by the end of fiscal year 2015—an amount that is  approximately $300 million higher than OMB’s goal. Between fiscal years  2011 and 2017, agencies reported planning approximately $5.3 billion in  total savings and avoidances. However, planned cost savings may be  higher because six agencies with as many as 67 data center closures  each have been limited in their abilities to fully report their savings. In  addition, slightly more than half of agencies with planned cost savings are  underreporting their fiscal years 2012 through 2015 figures to OMB by  approximately $2.2 billion. While several agencies noted internal agency  communication issues as the reasons for not reporting savings to OMB,  other agencies were unable to provide a reason. Specifically, between fiscal years  2011 and 2013, 19 agencies collectively reported achieving an estimated  $1.1 billion in cost savings and avoidances. Notably, Defense, the  Department of Homeland Security (DHS), and the Department of the  Treasury (Treasury) account for approximately $850 million (or 74  percent) of the reported estimated savings through fiscal year 2013. As prescribed by OMB’s initial guidance on data center consolidation, the  19 agencies that reported achieving cost savings and avoidances did so  using a variety of approaches. Further, through fiscal year 2017, these agencies collectively reported  planning an additional $2.1 billion in cost savings and avoidances, for a  total of approximately $5.3 billion. Although agencies are already collectively reporting approximately $5.3  billion in planned cost savings and avoidances from their consolidation  efforts, these savings may be higher because 6 of the 24 agencies,  claiming between 11 and 67 data center closures each, have been limited  in their abilities to report savings. Specifically, of the 21  agencies with actual and estimated fiscal years 2012 through 2015 cost  savings and avoidances, 10 agencies fully reported their savings and  avoidances to OMB through the integrated data collection process, 8  agencies partially reported this information, and 3 agencies did not report  it. Agencies Reported Successes and Challenges in Achieving Cost Savings

		Agencies Reported That Efforts to Achieve Consolidation Cost Savings Face Challenges Similar to Those Previously Reported

In 2011 and 2012, we reported on the broad challenges that agencies  were facing during data center consolidations. In light of how  closely the successes and challenges reported by agencies relate to  achieving cost savings—a key OMB goal for FDCCI—it will be important  for OMB to continue to provide leadership and guidance to the initiative. directed the Task Force to develop data  In May 2014, OMB released a set of 11 data center consolidation  optimization metrics established by the Task Force. In  addition, related targets to be achieved by the end of fiscal year 2015  have been established for all the metrics except for the cost-per- operating-system metric, which provides for measuring progress on  optimizing data center costs. As previously mentioned, in 2009, OMB  reported that server utilization rates were as low as 5 percent across the  federal government’s servers. According to an official from the  GSA FDCCI Program Management Office that led initial efforts to  establish the metrics, server utilization was not included as a metric for a  variety of reasons, including that agencies have not traditionally collected  the necessary data to be able to calculate server utilization, agencies do  not have the server monitoring capabilities required to collect such data,  and improvements in other areas of the metrics (such as virtualization)  would likely result in higher server utilization. In addition, without a specific metric for server  utilization, OMB may not be fully aware of agencies’ progress on a key  metric that was a driving force in launching FDCCI. Specifically, OMB and 12 agencies agreed with  our recommendations, 1 agency did not state whether it agreed or  disagreed, 1 agency had no comments, and 1 agency—NASA—agreed  with one of our recommendations but partially agreed with the other. Accordingly, we continue to believe our recommendation remains  valid. Appendix I: Objectives, Scope, and Methodology

Our objectives were to (1) evaluate the extent to which agencies have  achieved cost savings to date and identified future savings through their  consolidation efforts, (2) identify agencies’ notable consolidation  successes and challenges in achieving cost savings, and (3) evaluate the  extent to which data center optimization metrics have been established.
Why GAO Did This Study

In 2010, as focal point for information technology management across the government, OMB's Federal Chief Information Officer launched the Federal Data Center Consolidation Initiative to consolidate the growing number of centers. As of May 2014, agencies reported a total of 9,658 data centers—approximately 6,500 more than reported by OMB in 2011.
GAO was asked to review federal agencies' continuing efforts to consolidate their data centers and achieve cost savings. The objectives were to (1) evaluate the extent to which agencies have achieved cost savings to date and identified future savings through their consolidation efforts, (2) identify agencies' notable consolidation successes and challenges in achieving cost savings, and (3) evaluate the extent to which data center optimization metrics have been established. GAO assessed agency-reported cost savings and avoidance documentation, interviewed agency officials, and assessed data center optimization metrics against prior OMB requirements and goals.

What GAO Found

Of the 24 agencies participating in the Federal Data Center Consolidation Initiative, 19 agencies collectively reported achieving an estimated $1.1 billion in cost savings and avoidances between fiscal years 2011 and 2013. Notably, the Departments of Defense, Homeland Security, and Treasury accounted for approximately $850 million (or 74 percent) of the total. In addition, 21 agencies collectively reported planning an additional $2.1 billion in cost savings and avoidances by the end of fiscal year 2015, for a total of approximately $3.3 billion—an amount that is about $300 million higher than the Office of Management and Budget's (OMB) original $3 billion goal. Between fiscal years 2011 and 2017, agencies reported planning a total of about $5.3 billion in cost savings and avoidances.
However, planned savings may be higher because six agencies that reported having closed as many as 67 data centers reported limited or no savings, in part because they encountered difficulties, such as calculating baseline data center costs. In addition, 11 of the 21 agencies with planned cost savings are underreporting their fiscal years 2012 through 2015 figures to OMB by approximately $2.2 billion. While several agencies noted communication issues as the reason for this, others did not provide a reason. Until OMB assists agencies in reporting savings and agencies fully report their savings, the $5.3 billion in total savings will be understated.
Most agencies reported successes in achieving cost savings—notably, the benefits of key technologies, reduced power consumption and facility costs, and improvements in asset inventories. However, agencies also reported challenges, many of which were the same as GAO found in 2012. One of the most-reported challenges was related to obtaining power usage information as a means to determine cost savings. In light of how closely these successes and challenges relate to achieving cost savings, it is important for OMB to continue to provide leadership and guidance, including—as GAO previously recommended—using the Data Center Consolidation Task Force to monitor agencies' efforts.
Pursuant to OMB guidance, in May 2014 the Data Center Consolidation Task Force completed a set of 11 metrics to measure agency progress toward optimizing their data centers, such as power usage and facility utilization. In addition, related targets to be achieved by fiscal year 2015 have been developed for nearly all the metrics. However, the metrics do not address server utilization, even though OMB reported this to be as low as 5 percent in 2009, which is significantly below OMB's target of 60 to 70 percent. Without such a metric, OMB may not be getting important insight into agencies' progress on a key issue that was a driving factor in launching the consolidation initiative.

What GAO Recommends

GAO is recommending that OMB assist agencies in reporting cost savings and develop a metric for server utilization as part of any reevaluation of the metrics. GAO is also recommending, among other things, that agencies fully report their consolidation cost savings. OMB and 12 agencies agreed, 1 did not state whether it agreed or disagreed, 1 had no comments, and 1 partially agreed noting challenges. GAO continues to believe the recommendation remains valid as discussed in the report.