CIOs build case for business case

Low revenues mean states will have to build strong business cases for IT projects, panel of CIOs says

With budget revenues below expectations in most state governments, getting

information technology projects approved during the next two years will

require a strong business case, according to several experts and chief information

officers.

During a roundtable discussion April 9 at the National Association of

State Chief Information Officers' midyear conference in Denver, a survey

of about two dozen chief information officers found that 57 percent said

that building a business case showing a return-on-investment (ROI) strategy

is the single most important driver of new funding for IT initiatives.

Another 26 percent said getting high-level political support was most

important, while 13 percent rated implementing new mandates highest and

4 percent said there were other reasons, although they did not clarify what

those reasons are.

"If you didn't have a strong ROI, you simply didn't get funded," Louisiana

CIO Chad McGee said about how IT projects were handled in his state.

"There is deep suspicion [from the governor and legislature] about any

large expenditures that don't have cost/benefit analyses," Minnesota CIO

David Fisher said.

Ohio CIO Gregory Jackson said he's encouraging vendors to help agencies

in his state to go through that process because many haven't done so before.

Charles Gerhards, the CIO of Pennsylvania, said that it was important

to communicate to state officials that IT is tied to critical business issues

and that it should not be viewed as "another line in the budget."

"IT in state government is not a side activity," said Georgia CIO Larry

Singer. "IT can be used to improve outcomes, achieve public policy objectives."

This year, 45 states are reporting revenues below their expectations

and 37 are forecasting that the situation will carry over into the following

year, said Arturo Perez, senior policy specialist for the National Conference

of State Legislatures, in an earlier panel discussion. He said IT projects

would have to be prioritized and justified just like other state programs.

"I don't have any good advice except that it's a tough sell," he said.

Art Burgess, Wyoming's budget director and a representative of the National

Association of State Budget Officers, said that although the country technically

was not in a recession, revenues would decline slightly or stay flat for

the next 12 to 18 months.

"If you've had IT projects that did not live up to expectations, you're

going to have a difficult sell," he said.

Nancy McCallin, Colorado's planning and budget director, said her state

is projecting at least a $650 million revenue shortfall this year, compounded

by the recession, the decline in the stock market and the effects Sept.

11 had on tourism and company layoffs. She said health care, education and

other mandated costs are "significant drivers" in the overall budget.

Although the budget shortfalls will not affect some of the major technology

projects already begun, such as a state management system and a telecommunications

network, the state will not replace old computers, she said.

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