As reported to OMB, federal agencies plan to spend  more than $74 billion on IT investments in fiscal year 2013, which is the  total expended for not only acquiring such investments, but also the  funding to operate and maintain them. Many of these investments are critical to our nation. Specifically, as of August 2012,  according to the IT Dashboard, 190 of the federal government’s  approximately 700 major IT investments—totaling almost $12.5 billion— were in need of management attention (rated “yellow” to indicate the need  for attention or “red” to indicate significant concerns). Currently, the Dashboard publicly  displays information on the cost, schedule, and performance of over 700  major federal IT investments at 26 federal agencies. We previously reported and testified on the issue of duplicative IT  investments at DOD and the Department of Energy. We made  recommendations to those agencies to report on the progress of efforts to  identify and eliminate duplication, where appropriate. IT Dashboard  OMB has taken significant steps to enhance the oversight, transparency,  and accountability of federal IT investments by creating its IT Dashboard,  and by improving the accuracy of investment ratings. However, there  were issues with the accuracy and reliability of cost and schedule data,  and we recommended steps that OMB should take to improve these data. More recently, in October 2012 we found that opportunities existed to  improve transparency and oversight of investment risk at our selected  agencies. Specifically, CIOs at six federal agencies consistently  rated the majority of their IT investments as low risk. In the past, OMB reported trends for  risky IT investments needing management attention as part of its  annual budget submission, but discontinued this reporting in fiscal  year 2010. Accordingly, we recommended OMB analyze agencies’  investment risk over time as reflected in the Dashboard’s CIO ratings  and present its analysis with the President’s annual budget  submission, with which OMB concurred. DOD’s ratings were unique in reflecting additional  considerations, such as the likelihood of OMB review, and  consequently DOD did not rate any of its investments as high risk. Although three DOD investments experienced significant  performance problems and were part of a GAO high-risk area  (business systems modernization), they were all rated low risk or  moderately low risk by the DOD CIO. The nine  In addition to efficiently acquiring IT investments, it is also important for  the federal government to efficiently manage operational investments,  especially since agencies are planning to spend about $54 billion in fiscal  year 2013 on operational systems. Oversight of Investments in O&M  While agencies spend billions on operational investments, they have not  always provided adequate oversight of these investments. all investments and that all factors are fully assessed; and OMB revise its  guidance to include directing agencies to report on the IT Dashboard the  results from the OAs. We  issued two reports on the federal government’s effort to consolidate data  centers and made several recommendations for improvements. In a subsequent report we noted that agencies updated their  inventories and plans, but key elements were still missing. OMB noted that the savings would be even greater and  estimated that FDCCI would realize $3 billion in savings by 2015.However, while OMB required agencies to complete missing elements  in their data center inventories and plans by the end of September  2011, only 3 agencies submitted complete inventories, and only 1  agency submitted a complete plan. Our  report noted that until these inventories and plans were complete,  agencies would continue to be at risk of not realizing anticipated  savings, improved infrastructure utilization, or energy efficiency. As a result, we recommended that the five selected  agencies should implement recognized best practices when  establishing schedules and cost estimates for their consolidation  efforts and that OMB ensure agencies utilize its standardized cost  model across the consolidation initiative. We reported on the federal  government’s progress toward implementing these actions in April 2012.OMB and key federal agencies had made progress on action items in the  IT Reform Plan, but there were several areas where more remained to be  done.
Why GAO Did This Study

The federal government plans to spend more than $74 billion on IT investments in fiscal year 2013. Given the size of these investments and the criticality of many of them to the health, economy, and security of the nation, it is important that OMB and federal agencies provide appropriate oversight of and adequate transparency into these programs. Nevertheless, IT projects too frequently incur cost overruns and schedule slippages, and result in duplicate systems while contributing little to mission-related outcomes.
GAO was asked to testify on the results and recommendations from its selected reports that focused on key aspects of the federal government's acquisition and management of IT investments. To prepare this statement, GAO drew on previously published work.

What GAO Found

GAO has issued a number of key reports on the federal government's efforts to efficiently acquire and operate information technology (IT) investments and found that if major initiatives are fully implemented, billions of dollars in savings could be realized. In particular, GAO has made recommendations regarding the Office of Management and Budget's (OMB) public website, known as the IT Dashboard, which provides detailed information on federal agencies' major IT investments; agencies' efforts to perform analyses on existing IT investments; and agencies' progress toward consolidating data centers.
OMB has taken significant steps to enhance the oversight, transparency, and accountability of federal IT investments by creating its IT Dashboard, and by improving the accuracy of investment ratings. However, there were issues with the accuracy and reliability of cost and schedule data in the Dashboard, and GAO has recommended steps that OMB and agencies should take to improve these data--this is important since the Dashboard reports 190 investments totaling almost $12.5 billion being at risk. GAO recently reported that six federal agencies consistently rated the majority of their IT investments as low risk. Further, the Department of Defense's (DOD) ratings reflected considerations in addition to those OMB recommends, and consequently it did not rate any of its investments as high risk. However, GAO has recently reported that several DOD investments experienced significant performance problems and were indeed high risk, and that DOD business systems modernization is a high-risk area. In the past, OMB reported trends for risky IT investments needing management attention as part of its annual budget submission, but discontinued this reporting in fiscal year 2010. GAO recommended OMB analyze agencies' investment risk over time as reflected in the Dashboard's ratings and present its analysis with the President's annual budget submission.
While agencies plan to spend billions on operational investments--more than $54 billion in fiscal year 2013-- they have not always provided adequate oversight of these investments. Specifically, GAO reported in October 2012 that five agencies had operational investments with a fiscal year 2011 budget of over $3 billion that had not undergone operational analyses as required by OMB. The report also noted that until operational investments are fully assessed, there was increased potential for these multibillion dollar investments to result in unnecessary waste and duplication. GAO recommended that the five agencies conduct required analyses.
GAO reported on the federal government's progress toward data center consolidation (which OMB expects will save $3 billion by 2015). In July 2012, GAO found that agencies updated their required inventories and plans, but only 3 of 24 agencies in the review submitted complete inventories and only 1 agency submitted a complete plan, as required by OMB. Until these inventories and plans were complete, agencies would continue to be at risk of not realizing anticipated savings, improved infrastructure utilization, or energy efficiency. Accordingly, GAO reiterated a prior recommendation to update inventories and plans, and also recommended that agencies use best practices when developing estimates.

What GAO Recommends

GAO has issued numerous recommendations to OMB and agencies on key aspects of IT management, including (1) OMB's public website, known as the IT Dashboard, which provides detailed information on federal agencies' major IT investments, and (2) efforts to oversee IT operations and consolidate data centers.