The case for a federal department of IT

CIO (Panchenko Vladimir/ 

In its FY2020 budget request to Congress, the Trump administration proposed a major cut in technology for the Office of Management and Budget. This is not a wise move. For more effective federal IT management, the White House and Congress should further expand the role of the federal CIO in technology oversight and modernization.

Toward that end, I propose that the Office of E-Government and IT become an independent agency, alongside other independent agencies with governmentwide policy roles, including OMB and the General Services Administration. To emphasize its role in driving technology modernization, I suggest that the new agency be named the Technology Modernization Administration. The federal CIO will head the TMA and assume greater control over governmentwide IT modernization and cybersecurity protection.

The private sector has in recent years elevated the role of the CIO to report directly to the company head, rather than to a finance or operations chief, in recognition of the critical role of IT. With a greater voice in top management and a direct reporting relationship to a CEO, a CIO is expected to play a leadership role in digital transformation in business.

According to a study by Paul Pavlou and his colleagues,, when a CIO directly reports to a CEO, IT can better serve as a strategic differentiator for firms. Dorothy Leidner and her team found that stronger decision-making authority of a CIO increases the contribution of IT to firm performance.

My research on government IT suggests that IT investments create greater value to government when a CIO position is formally codified in legislation, and a CIO nominee is confirmed by the legislature.

The Federal Information Technology Acquisition Reform Act (FITARA) has expanded the authority of agency CIOs and requires that a CIO report to the head of an agency. This was a step in the right direction but fell short in strengthening the federal CIO. A more critical problem in federal IT management is that governmentwide IT management functions are fragmented across OMB, GSA, Department of Homeland Security and other agencies. Consequently, no single top-level official is in charge of leading technology modernization and cybersecurity across the executive branch.

A Senate-confirmed federal CIO directly reporting to the president would be held accountable for performance in modernization and cybersecurity. In this arrangement, the president will be able to appoint a person who shares administration's policy priorities, and the Senate will have an opportunity to examine the CIO's qualifications. As the head of the independent agency, rather than a subordinate of the director of the OMB, an empowered CIO will be able to exercise greater statutory authority in driving modernization initiatives across the federal government.

Specifically, the agency I envision would

  • Oversee agency modernization and cloud initiatives.
  • Manage the Technology Modernization Fund (TMF).
  • Formulate technology standards for enterprise architecture and cybersecurity.
  • Coordinate interagency collaboration such as shared services and data center consolidation.
  • Lead open government data initiatives.
  • Devise strategies for developing technology talent in government.
  • Host the U.S. Digital Service.
  • Assist modernization efforts in state and local governments.

In addition, the Technology Transformation Services and other policy and oversight functions of the GSA for federal IT would be consolidated inside the TMA. In the long run, the TMA could take over IT procurement functions from the Federal Acquisition Service, a topic that I will make the case for in my next commentary.

The TMA will be funded by both direct appropriations by Congress (including the TMF) and fee-for-services from federal agencies and state/local governments for shared services, the U.S. Digital Service, and 18F.

The federal IT budget will surpass $100 billion in a near future, and much of it will be spent in legacy infrastructures. This trend is not sustainable. The government needs a strong, permanent leadership and a dedicated independent agency in IT modernization and cybersecurity more than ever.

About the Author

Min-Seok Pang is an associate professor and Milton F. Stauffer Research Fellow at Fox School of Business, Temple University. His research centers on strategic management of IT in the public sector and technology-enabled public policies.


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