Billions Wasted On Redundant Federal IT Spending

The administration's IT guru says billions are squandered on unnecessary systems and services.

InformationWeek Staff, Contributor

February 11, 2003

2 Min Read

The federal government might be squandering as much as one-fifth of the nearly $60 billion it allocates for IT on redundant systems and services.

"There's a significant amount of redundant spending," Mark Forman, associate director for IT and E-government at the Office of Management and Budget, said at a news conference on Tuesday in Santa Clara, Calif. "Maybe it's as high as 20% of the budget. We don't have an analysis to that level of detail."

One reason redundant spending might be so high is a dearth of qualified project managers in government who oversee IT acquisition, Forman said. Last week, in outlining the Bush administration's $59.3 billion fiscal 2004 budget request for IT, Forman said hiring and training staff to manage more than 5,000 major IT projects is a big problem. "Pure and simple," he said, "we don't have enough project managers and solutions architects for the work we ask them to do."

Forman said the government is beginning to rein in such duplication. He cited the administration's 24 E-government initiatives in which agencies work together to develop common systems. Such consolidations, Forman said, can cut government IT costs by 25%.

Under the watchful eye of OMB, Forman said government agencies can reduce redundant IT spending by taking technologies developed at one agency and reusing them elsewhere in government, standardizing business processes throughout government, and taking advantage of economies of scale as agencies begin to share more systems.

Forman was in California on a reverse sales call, meeting with hundreds of vendors in sessions at Sun Microsystems and Oracle, where he explained the government's IT needs. Accompanying Forman was James Kane, CEO of Federal Sources, a public-sector IT market-intelligence firm. Kane said 90% of standard commercial products and services can be adapted for government use.

With the feds earmarking billions more on IT each year, there's plenty of sales opportunities for vendors. Kane predicts the government actually will spend $62 billion to $62.5 billion on IT next year. He said the government, unlike many commercial buyers, pays on time and informs vendors in advance of exactly what they're looking for. But, he warns, it could take six to 18 months to land the first sale; new sales should come faster once a vendor has its foot in the door.

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