However, as we have described in numerous reports,  although a variety of best practices exist to guide their successful  acquisition, federal IT projects too frequently incur cost overruns and  schedule slippages while contributing little to mission-related outcomes. Given the importance of transparency, oversight, and  management of the government’s IT investments, in June 2009, OMB  established a public website, referred to as the IT Dashboard, that  provides detailed information on 760 major IT investments at 27  federal agencies, including ratings of their performance against cost  and schedule targets. Among other things, agencies are to submit Chief  Information Officer (CIO) ratings, which, according to OMB’s  instructions, should reflect the level of risk facing an investment on a  scale from 1 (high risk) to 5 (low risk) relative to that investment’s  ability to accomplish its goals. OMB believes that this initiative has the potential to  provide about $3 billion in savings by the end of 2015. PortfolioStat. Opportunities Exist to Improve Acquisition and Management of IT Investments

Given the magnitude of the federal government’s annual IT budget, which  is expected to be more than $82 billion in fiscal year 2014, it is important  that agencies leverage all available opportunities to ensure that their IT  investments are acquired in the most effective manner possible. To do so,  agencies can rely on IT acquisition best practices and initiatives such as  OMB’s IT Dashboard, and OMB-mandated TechStat sessions. Best Practices Are Intended to Help Ensure Successful Major Acquisitions

In 2011, we identified seven successful acquisitions and nine common  factors critical to their success, and noted that (1) the factors support  OMB’s objective of improving the management of large-scale IT  acquisitions across the federal government, and (2) wide dissemination of  these factors could complement OMB’s efforts. IT Dashboard Can Improve the Transparency into and Oversight of Major IT Investments

The IT Dashboard serves an important role in allowing OMB and other  oversight bodies to hold agencies accountable for results and  performance. However, we have issued a series of reports highlighting  deficiencies with the accuracy and reliability of the data reported on the  Dashboard. Further, while we reported in 2011 that the accuracy of Dashboard cost  and schedule data had improved over time, more recently, in December  2013 we found that agencies had removed investments from the  Dashboard by reclassifying their investments—representing a troubling  trend toward decreased transparency and accountability. Additionally,  as of December 2013, the public version of the Dashboard was not  updated for 15 of the previous 24 months because OMB does not revise it  as the President’s budget request is being created. We also found that, while agencies experienced several issues with  reporting the risk of their investments, such as technical problems and  delayed updates to the Dashboard, the CIO ratings were mostly or  completely consistent with investment risk at seven of the eight selected  agencies. Six  agencies generally agreed with the report or had no comments and two  others did not agree, believing their categorizations were appropriate. Continued Oversight Needed to Consolidate Federal Data Centers and Achieve Cost Savings

In an effort to consolidate the growing number of federal data centers, in  2010, OMB launched a consolidation initiative intended to close 40  percent of government data centers by 2015, and, in doing so, save $3  billion. Among other things, we  recommended that OMB track and report on key performance measures,  such as cost savings to date, and improve the execution of important  oversight responsibilities, and that agencies complete inventories and  plans. OMB agreed with these two recommendations, and most agencies  agreed with our recommendations to them. Specifically, as of May 2013, agencies had reported closing 484 data  centers by the end of April 2013, and were planning to close an additional  571 data centers—for a total of 1,055—by September 2014. Agencies’ PortfolioStat Efforts Have the Potential to Save Billions of Dollars

OMB launched the PortfolioStat initiative in March 2012, which required  26 executive agencies to, among other things, reduce commodity IT  spending and demonstrate how their IT investments align with the  agency’s mission and business functions. In addition, we made  several recommendations to improve agencies’ implementation of  PortfolioStat requirements. OMB partially agreed with these  recommendations, and responses from 20 of the agencies commenting  on the report varied.
Why GAO Did This Study

The federal government reportedly plans to spend at least $82 billion on IT in fiscal year 2014. Given the scale of such planned outlays and the criticality of many of these systems to the health, economy, and security of the nation, it is important that OMB and federal agencies provide appropriate oversight and transparency into these programs and avoid duplicative investments, whenever possible, to ensure the most efficient use of resources.
GAO has previously reported and testified that federal IT projects too frequently fail and incur cost overruns and schedule slippages while contributing little to mission-related outcomes. Numerous best practices and administration initiatives are available for agencies that can help them improve the oversight and management of IT acquisitions.
GAO is testifying today on the results and recommendations from selected reports that focused on how best practices and IT reform initiatives can help federal agencies better manage major acquisitions and legacy investments.

What GAO Found

Information technology (IT) acquisition best practices have been developed by both industry and the federal government to help guide the successful acquisition of investments. For example, GAO recently reported on nine critical factors underlying successful major IT acquisitions. Factors cited included (1) program officials were actively engaged with stakeholders and (2) prioritized requirements.
One key IT reform initiative undertaken by the Office of Management and Budget (OMB) to improve transparency is a public website, referred to as the IT Dashboard, which provides information on 760 major investments at 27 federal agencies, totaling almost $41 billion. The Dashboard also includes ratings of investments' risk on a scale from 1 (high risk) to 5 (low risk). As of April 2014, according to the Dashboard, 559 investments were low or moderately low risk (green), 159 were medium risk (yellow), and 42 were moderately high or high risk (red).
GAO has issued a series of reports on Dashboard accuracy and, in 2011, found that while there were continued issues with the accuracy and reliability of cost and schedule data, the accuracy of these data had improved over time. Further, a recent GAO report found that selected agencies' ratings were mostly or completely consistent with investment risk. However, this report also noted that agencies had removed major investments from the IT Dashboard, representing a troubling trend toward decreased transparency and accountability. Additionally, GAO reported that as of December 2013, the public version of the Dashboard was not updated for 15 of the previous 24 months because OMB did not revise it as the President's budget request was being created. Consequently, GAO made recommendations to improve the Dashboard's accuracy, ensure that it includes all major IT investments, and increase its availability. Agencies generally agreed with the report or had no comments.
In an effort to consolidate the growing number of federal data centers, OMB launched a consolidation initiative intended to close 40 percent of government data centers by 2015, and in doing so, save $3 billion. GAO reported that agencies planned to close 1,055 data centers by the end of fiscal year 2014, but also highlighted the need for continued oversight of these efforts. Among other things, GAO recommended that OMB improve the execution of important oversight responsibilities, with which OMB agreed.
To better manage the government's existing IT systems, OMB launched the PortfolioStat initiative, which, among other things, requires agencies to conduct annual reviews of their IT investments and make decisions on eliminating duplication. GAO reported that agencies continued to identify duplicative spending as part of PortfolioStat and that this initiative has the potential to save at least $5.8 billion by fiscal year 2015, but that weaknesses existed in agencies' implementation of the initiative's requirements. Among other things, GAO made several recommendations to improve agencies' implementation of PortfolioStat requirements. OMB partially agreed with these recommendations, and most of the other 20 agencies commenting on the report also agreed.

What GAO Recommends

GAO has previously made numerous recommendations to OMB and federal agencies on key aspects of IT acquisition management, as well as the oversight and management of these investments. In particular, GAO has made recommendations regarding the IT Dashboard, efforts to consolidate federal data centers, and PortfolioStat.