Hurdles on the path to IT management reform

The Obama administration's plans to reform IT management are likely to run into some daunting -- but familiar -- difficulties.

In 1996, Franklin Raines, then director of the Office of Management and Budget, issued a memo known as Raines' rules, which identify eight basic principles that should guide IT investments.

For example, agencies should establish “clear measures and accountability for project progress” (Rule No. 6), and they should develop projects “in phases as narrow in scope and brief in duration as possible, each of which solves a specific part of an overall mission problem and delivers an independent, measurable net benefit” (Rule No. 7).

Sound familiar?

When the current team at OMB unveiled its 25-point plan to reform IT management in the federal government, much of it had a familiar ring.

It’s not that Obama administration officials are recycling ideas. It’s just that they are trying, as others have tried before them, to overcome obstacles that have made it difficult for federal agencies to inject more common sense into their IT management strategies.

Agencies should be able to make sound business decisions about IT programs, scaling back or canceling projects that are not panning out. They should have the flexibility to structure programs to deliver concrete results in small increments, instead of pinning all their hopes — and money — on some final payoff. And they should be able to work with industry to develop the best approach to a given program.

During last month’s White House briefing, federal CIO Vivek Kundra stressed that the IT management reform effort is all about execution. But it’s not that simple, even if the plan is sensible, observers say.

To make it work, the administration will need to overcome several points of cultural and institutional resistance that have defied previous efforts at sensible reform.

The plan: More power for CIOs

In the next six months, the Obama administration aims to redefine the role of agency CIOs by shifting their responsibility from policy-making to portfolio management, thereby strengthening government accountability and efficiency.

Specifically, the reform plan indicates that agency CIOs will be responsible for continuously identifying unmet needs that new projects should address, terminating or turning around poorly performing projects, and pulling the plug on systems that no longer meet the agency’s needs. As part of that role, agency CIOs will lead TechStat accountability sessions in which they will review detailed performance metrics that help them evaluate a program’s health.

The CIO Council will fulfill a similar management role at a cross-agency level.

To make it work, however, observers say the federal government must ensure that CIOs are considered part of their agencies’ leadership teams and not pigeonholed as technology wonks, which is the case at many agencies.

Because of the enormous pressure to increase the value of the government’s IT investments, CIOs can’t be confined to dealing with technology policy, said Rick Webb, former state CIO for North Carolina.

Rather than simply focusing on technology, CIOs must be part of the team that makes decisions about the agency’s core business programs.

“CIOs, if they are positioned appropriately in the organization, generally have one foot in the area of business and one foot in technology,” said Webb, who is now chief technology officer of Accenture’s state and local government practice for the United States and Canada.

For that to happen, CIOs must learn to think — and talk — in business terms.

Mark Forman, who was the federal government’s first CIO, expressed a similar perspective.

“A CIO has to understand the business processes of their agency,” said Forman, former administrator for e-government and IT at OMB and now leader of KPMG’s Federal Performance and Technology Advisory Services practice.

He added that the federal government must build a cadre of CIOs who can communicate to nontechnical people the value of an IT project that will transform the way the agency does business.

And sources agreed that if the administration is serious about granting CIOs greater oversight authority, it must ensure that they are considered part of their agencies' leadership teams.

“In some agencies, the agency CIO has a seat at the executive leadership table,” said Bob Dix, vice president of government affairs and critical infrastructure protection at Juniper Networks. “In the majority of agencies, the CIO role is four or five levels down. [They] don’t have a seat at the table.”

Dix said an important element of the IT reform plan should be empowering and elevating the CIO role across Cabinet agencies — something that can’t be achieved without buy-in from agency leaders.

The plan: More dialogue with industry

In theory, an IT program should be a collaborative effort between government and industry.

Rather than simply specifying solutions they want to buy, agencies should be working with industry vendors to identify the best possible approach for meeting a particular goal.

In fact, existing procurement laws and regulations give agencies the authority to conduct discussions with companies. Even during the procurement process, government officials can talk with contractors without giving one an unfair advantage over another.

But by and large, that isn’t happening, primarily because contracting officials are concerned about going too far in their discussions with would-be bidders and compromising the integrity of a procurement.

“We are keenly aware of the fact that there is often fear on the part of the government people that if they talk to industry they’re going to get in trouble,” said Dan Gordon, administrator of the Office of Federal Procurement Policy.

As a result, agencies often get just what they ask for, which is not necessarily what they need. The system makes it difficult for agencies to learn about recent innovations that could reshape how they approach a given program.

“There could be a better technological solution that we’re not finding out about because we’re afraid to talk with industry,” Gordon said.

That’s not because of a lack of effort on industry’s part. Contractors have told Gordon that they have contacted their customer agencies only to be cut off when they try to initiate a conversation.

“I’ve been told way too many times that when they try to talk to the contracting officer, they were told, ‘Can’t talk to you. Word has come from on high,’ ” Gordon said in a discussion Dec. 10. “I’m telling them that’s not the word.”

Paul Brubaker, senior director of the North American Public Sector Practice at Cisco Systems’ Internet Business Solutions Group, said ethics officers and inspector general staff members help stoke the acquisition workforce’s nervousness.

“It seems to be their mission to scare everybody into not communicating,” he said.

Gordon apparently got that message. He said discussions about appropriate government/industry dialogue would include inspectors general, ethics officers, the Office of Government Ethics and agency attorneys.

“We can do this if we work our way through it, listening to all those who want to advise us and then giving clear guidance about what the do’s are and not only what the don’ts are,” he said.

The plan: Greater budget flexibility

When Kundra unveiled the IT management reform plan, he said one of its toughest elements would be aligning the budget process with the technology cycle. Flexible IT budget models are needed, although some sources say they believe the plan could work even without them.

According to the reform plan, in the next six months, OMB will work with Congress and federal agency leaders to develop IT budget models that align with modular development.

Those models would allow agencies to move funds around as needed to respond to unfolding requirements and changes in circumstances. Traditional budgeting requires agencies to make final decisions on IT solutions years in advance and offers few options for changing them later.

Tom Davis, former Republican congressman from Virginia and now director of federal government affairs at Deloitte and Touche, said he thinks the models are an important aspect of IT reform but might be challenging to implement because they would interfere with Congress’ authority.

“Congress likes their prerogatives in terms of where the money comes from and how it is spent,” he said. “Congress doesn’t easily give up its power.”

Other sources said the budget process is a touchy subject for lawmakers and noted that Congress rarely approves appropriations legislation in a timely fashion. Those issues could create roadblocks for IT budget reform, despite the Obama administration’s ambitious goals.

Nonetheless, Davis said, he doesn’t think the 25-point reform effort will fall apart if funding isn’t aligned with the technology cycle.

However, Trey Hodgkins, vice president of national security and procurement policy at TechAmerica, said the budget models are a critical part of IT reform.

“It’s one of the legs of the stool here,” he said. “Buying and budgeting the way we do today is ineffective and costs more money.”

Hodgkins said there are examples of federal agencies using flexible IT budget methods for lawmakers to consider. The Defense Department uses flexible budget accounts, and the reform plan the Veterans Affairs Department has suggested presents another potential model.

Because of greater budget flexibility, VA's CIO is able to freeze IT projects that are off-track and either restructure or cancel them, the plan states. VA also established an accountability system to identify projects that are missing their milestones.

Still, Hodgkins said, all the other pieces of the plan are important and will lead to improvements in the government’s management of IT reform.

Although it might be difficult to get Congress to agree to changes in the budget process, some lawmakers have expressed their support for the plan overall.

A plan that could work: A new IT career track

Although observers debate the viability of some elements of the Obama administration’s plan to reform IT management, one point seems likely to win over the skeptics: create a dedicated IT career track in the federal government.

To ensure that the plan results in action and not just another pile of analysis and guidance documents, the administration has proposed the creation of a specialized career path for IT program managers who will shepherd projects from start to finish and resolve issues before they become roadblocks.

Sources said hiring qualified program managers to oversee large-scale IT projects is the most important investment the government can make.

In the next six months, the Office of Personnel Management will work with agencies and OMB to develop the IT program management career path. OPM intends to test the career track at the Treasury and Agriculture departments.

IT program managers need the help. They often get put on the job without any formal training, and before they know it, they are managing multiple projects. A program manager might oversee a multibillion-dollar program while also managing several other programs, Hodgkins said.

Ideally, there would be enough trained federal program managers so that each major IT project has a dedicated leader, he added.

Davis agreed that creating a career path for program managers is critical in the federal sector and makes sense from a financial point of view. He added that the career path and an appropriate salary are needed to attract skilled managers.

The reform plan also recognizes the “siloed nature of government stakeholder communities” and points to the private-sector practice of bringing together small, multidisciplinary program teams as a solution.

To implement that practice in the government, OMB will issue guidance requiring that integrated program teams, led by a full-time program manager and supported by an IT acquisition specialist, be in place for all major IT programs before OMB will approve program budgets.

That is an important part of the reform plan, Hodgkins said.

“Right now, the way the process works, it is purely coincidental if all the elements in the process are actually talking to each other,” Hodgkins said. “It makes no sense from our perspective to have a program spend millions and billions of dollars and then, after the fact, have auditors come in.”

Besides possible cultural issues at individual agencies, observers said they see few obstacles to implementing the new IT career track.

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