Consolidation gone too far

As the federal government throttles along the course of consolidating systems and outsourcing a growing portion of its work, along comes a cautionary tale from NASA that agencies should note.

NASA announced this month that it would rework its mammoth Consolidated Space Operations Contract (CSOC), which the agency awarded to Lockheed Martin Corp. in 1998 for $3.4 billion. Under the 10-year contract, Lockheed would consolidate 17 contracts covering data acquisition, transmission and processing, and storage and mission control center operations.

NASA estimated it would save $1.4 billion. How the separate centers and programs operated and their requirements were secondary — if even considered at all. The agency's view at the time: "Spacecom is spacecom," a top NASA manager recalled this month.

But after five years, NASA realized that the communications needs for its different programs and centers require different solutions. The agency announced it would split CSOC into five contracts to allow contractors to provide a broader set of solutions more tailored to the needs of each of its NASA customers.

The implications are significant for the Bush administration, which is trying to consolidate dozens of networks governmentwide to save money.

Certainly, agencies have duplicated numerous networks governmentwide, and many can be combined.

But information technology reformers should resist the desire to consolidate purely for money-saving ends. Managers must spend more time analyzing how an agency network, which is similar to others governmentwide, may serve a different enough purpose to warrant that it not be consolidated into a larger system. Will the system, standing alone, bring about a better outcome than if it were part of a larger one-size-fits-all system? It's about value and results.

As the Office of Management and Budget continues to analyze agencies' IT business cases for the fiscal 2004 budget, an effort should be made to make these subtle, yet consequential distinctions. One size does not fit all.

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