If done correctly, investments in IT have the potential to make organizations more efficient in fulfilling their missions. For example, we recently reported that Defense officials stated that an IT system supporting military logistics has improved the organization’s performance by providing real-time information about road conditions, construction, incidents, and weather to facilitate rapid deployment of military assets. However, as we have previously reported, investments in federal IT too frequently result in failed projects that incur cost overruns and schedule slippages while contributing little to mission-related outcomes. For example: In January 2011, the Secretary of Homeland Security ended the Secure Border Initiative Network program after obligating more than $1 billion for the program because it did not meet cost-effectiveness and viability standards. Since 2007, we have identified a range of issues and made several recommendations to improve this program. For example, in May 2010, we reported that the final acceptance of the first two deployments had slipped from November 2009 and March 2010 to September 2010 and November 2010, respectively, and that the cost-effectiveness of the system had not been justified. We concluded that DHS had not demonstrated that the considerable time and money being invested to acquire and deploy the program were a wise and prudent use of limited resources. As a result, we recommended that the department (1) limit near-term investment in the program, (2) economically justify any longer-term investment in it, and (3) improve key program management disciplines. This work contributed to the department’s decision to cancel the program. In February 2011, the Office of Personnel Management canceled its Retirement Systems Modernization program after several years of trying to improve the implementation of this investment.the Office of Personnel Management, it spent approximately $231 million on this investment. We issued a series of reports on the According to agency’s efforts to modernize its retirement system and found that the Office of Personnel Management was hindered by weaknesses in several important management disciplines that are essential to successful IT modernization efforts. Accordingly, we made recommendations in areas such as project management, organizational change management, testing, and cost estimating. In May 2008, an Office of Personnel Management official cited the issues that we identified as justification for issuing a stop work order to the system contractor, and the agency subsequently terminated the contract. In December 2012, Defense canceled the Air Force’s Expeditionary Combat Support System after having spent more than a billion dollars and missing multiple milestones, including failure to achieve deployment within 5 years of obligating funds. We issued several reports on this system and found that, among other things, the program was not fully following best practices for developing reliable schedules and cost estimates. Agencies have reported that poor-performing projects have often used a “big bang” approach—that is, projects that are broadly scoped and aim to deliver functionality several years after initiation. For example, in 2009 the Defense Science Board reported that Defense’s acquisition process for IT systems—which was rooted in the “waterfall” development model—was too long, ineffective, and did not accommodate the rapid evolution of IT.The board reported that the average time to deliver an initial program capability for a major IT system acquisition at Defense was over 7 years. Also in 2009, VA’s former chief information officer (CIO) reported that many of its projects exceeded cost estimates by more than 50 percent and missed scheduled completion dates by more than a year. That official concluded that VA needed to make substantial changes to its acquisition process in order to eliminate project failures associated with the “big bang” approach. One approach to reducing the risks from broadly scoped, multiyear projects is to divide investments into smaller parts—a technique long advocated by Congress and OMB. can potentially By following this approach, agencies deliver capabilities to their users more rapidly, giving them more flexibility to respond to changing agency priorities; increase the likelihood that each project will achieve its cost, schedule, and performance goals; obtain additional feedback from users, increasing the probability that each successive increment and project will meet user needs; more easily incorporate emerging technologies; and terminate poorly performing investments with fewer sunk costs. See Clinger-Cohen Act of 1996, Pub. L. No. 104-106 § 5202, 110 Stat. 186, 690 (1996), codified at 41 U.S.C. § 2308; see also 48 C.F.R. § 39.103 (Federal Acquisition Regulation); OMB, Management of Federal Information Resources, Circular No. A-130 Revised. implement them. More recently, in its 2010 IT Reform Plan, OMB called for IT programs to deliver functionality at least every 12 months and complete initial deployment to end users no later than 18 months after the start of the program. In 2011, as part of its budget guidance, OMB first recommended that projects associated with major IT investments deliver functionality every 6 months. OMB’s latest guidance now makes this mandatory; specifically, in 2012, OMB began requiring that functionality be delivered at least every 6 months. Over the last three decades, Congress has enacted several laws to assist agencies and the federal government in managing IT investments. For example, the Paperwork Reduction Act of 1995 requires that OMB develop and oversee policies, principles, standards, and guidelines for federal agency IT functions, including periodic evaluations of major information systems. In addition, to assist agencies in managing their investments, Congress enacted the Clinger-Cohen Act of 1996. Among other things, the act requires agency heads to appoint CIOs and specifies many of their responsibilities. With regard to IT management, CIOs are responsible for implementing and enforcing applicable governmentwide and agency IT management principles, standards, and guidelines; assuming responsibility and accountability for IT investments; and monitoring the performance of IT programs and advising the agency head whether to continue, modify, or terminate such programs. Additionally, with regard to incremental development, Clinger-Cohen calls for provisions in the Federal Acquisition Regulation that encourage agencies to structure their IT contracts such that the capabilities are delivered in smaller increments. The Federal Acquisition Regulation provisions are also to provide, to the maximum extent practicable, that the increment should be delivered within 18 months of the contract solicitation. As set out in these laws, OMB is to play a key role in helping federal agencies manage their investments by working with them to better plan, justify, and determine how much they need to spend on projects and how to manage approved projects. Within OMB, the Office of E-Government and Information Technology, headed by the Federal CIO, directs the policy and strategic planning of federal IT investments and is responsible for oversight of federal technology spending. In carrying out its responsibilities, OMB uses several data collection mechanisms to oversee federal IT spending during the annual budget formulation process. Specifically, OMB requires federal departments and agencies to provide information related to their IT investments (called exhibit 53s) and capital asset plans and business cases (called exhibit 300s). Exhibit 53. The purpose of the exhibit 53 is to identify all IT investments—both major and nonmajor—and their associated costs within a federal organization. Information included in agency exhibit 53s is designed, in part, to help OMB better understand agencies’ spending on IT investments. Exhibit 300. The purpose of the exhibit 300 is to provide a business case for each major IT investment and to allow OMB to monitor IT investments once they are funded. An IT investment may include one or more projects that are to develop, modernize, enhance, or maintain a single IT asset or group of IT assets with related functionality. Agencies are required to provide information on each major investment’s projects, including cost, schedule, and performance information. For example, in order to measure compliance with its requirement that projects deliver functionality in 6-month cycles, OMB requires agencies to break their projects into activities, and describe when the activities are to deliver functionality. OMB has implemented a series of initiatives to improve the oversight of underperforming investments and more effectively manage IT. These efforts include the following: IT Dashboard. In June 2009, to further improve the transparency into and oversight of agencies’ IT investments, OMB publicly deployed the IT Dashboard. As part of this effort, OMB issued guidance directing federal agencies to report, via the Dashboard, the performance of their IT investments. Currently, the Dashboard publicly displays information on the cost, schedule, and performance of over 700 major federal IT investments at 26 federal agencies. Further, the public display of these data is intended to allow OMB, other oversight bodies, and the general public to hold the government agencies accountable for results and progress. TechStat reviews. In January 2010, the Federal CIO began leading TechStats sessions—face-to-face meetings to terminate or turn around IT investments that are failing or are not producing results. These meetings involve OMB and agency leadership and are intended to increase accountability and transparency and improve performance. For example, the Federal CIO testified in June 2013 that he holds TechStat meetings on large investments that are not being acquired incrementally. More recently, OMB empowered agency CIOs to hold their own TechStat sessions within their respective agencies. In doing so, OMB has called for agencies to use their TechStat processes to identify investments that are not being acquired incrementally and undertake corrective actions. IT Reform Plan. In December 2010, OMB released its 25-point plan to reform federal IT. This document established an ambitious plan for achieving operational efficiencies and effectively managing large- scale IT programs. In particular, as part of its effort to effectively manage IT acquisitions, the plan calls for federal IT programs to deploy functionality in release cycles no longer than 12 months, and ideally, less than 6 months. The plan also identifies key actions that can help agencies implement this incremental development guidance, such as working with Congress to develop IT budget models that align with incremental development, and issuing contracting guidance and templates to support incremental development.