As we and OMB have noted, duplicative, wasteful, and low-value investments have proliferated over the years, highlighting the need for agencies to avoid such investments whenever possible. To help agencies manage their IT more effectively, reduce duplication, and achieve cost savings, OMB implemented a series of initiatives beginning in 2010: Data Center Consolidation and Optimization. In February 2010, the Federal Chief Information Officer (CIO) established the Federal Data Center Consolidation Initiative (FDCCI) to address the growing number of federal data centers. This initiative’s four high-level goals were to reduce the overall energy and real estate footprint of government data centers; reduce the cost of data center hardware, software, and operations; increase the overall IT security posture of the government; and shift IT investments to more efficient computing platforms and technologies. OMB estimates that the initiative has the potential to provide about $3 billion in savings by the end of 2015. In March 2013, OMB issued a memorandum that expanded FDCCI to include measuring the extent to which agencies have optimized their core data centers in areas such as energy, labor, and storage, and subsequently released a set of 11 data center optimization metrics to measure agency progress. IT Reform Plan. In December 2010, the Federal CIO established a 25- Point IT Reform Plan designed to address challenges in IT acquisition, improve operational efficiencies, and deliver more IT value to the American taxpayer. The plan set forth action items and required activities to consolidate the growing number of federal data centers, shift to increased use of cloud computing, and promote the use of shared service solutions. In addition, as part of an effort to reduce the risk associated with IT acquisitions, the plan calls for federal IT programs to deploy capabilities or functionality in release cycles no longer than 12 months, and ideally, less than 6 months. Cloud Computing Strategy. In order to accelerate the adoption of cloud computing solutions across the government, OMB’s 25-Point IT Reform Plan included a “Cloud First” policy that required each agency CIO to fully migrate three services to a cloud solution by June 2012, and implement cloud-based solutions whenever a secure, reliable, and cost-effective cloud option exists. Building on this requirement, in February 2011, OMB issued the Federal Cloud Computing Strategy, which provided definitions of cloud computing services; benefits of cloud services, such as accelerating data center consolidations; case studies to support agencies’ migration to cloud computing; and roles and responsibilities for federal agencies. According to OMB, shifting from building custom systems to adopting cloud technologies and shared solutions will improve the government’s operational efficiencies and result in substantial cost savings. PortfolioStat. In March 2012, OMB launched the PortfolioStat initiative, which requires agencies to conduct an annual agency-wide IT portfolio review to, among other things, reduce commodity IT spending and demonstrate how its IT investments align with the agency’s mission and business functions. PortfolioStat is designed to assist agencies in assessing the current maturity of their IT portfolio management process, make decisions on eliminating duplication, and move to shared solutions in order to maximize the return on IT investments across the portfolio. OMB reported that the PortfolioStat effort has the potential to save the government $2.5 billion between fiscal years 2013 and 2015 by consolidating and eliminating duplicative systems. IT Shared Services Strategy. In May 2012, building on a requirement established in its 25-Point IT Reform Plan, OMB released its Federal IT Shared Services Strategy. The strategy requires agencies to use shared services—IT functions that are provided for consumption by multiple organizations within or between federal agencies—for IT service delivery in order to increase return on investment, eliminate waste and duplication, and improve the effectiveness of IT solutions. Examples of commodity IT areas to consider migrating to a shared environment, as described in the strategy, include software licenses, e-mail systems, and human resource systems. According to OMB, a review of over 7,000 federal agency IT investments reported in budget year 2013 revealed many redundancies and billions of dollars in potential savings that could be achieved through consolidation and a shared approach to IT service delivery within and between agencies. With the potential for significant savings, and in continuing its focus on increasing efficiency and reducing costs, OMB established both one-time and ongoing requirements for agencies to establish plans to reinvest their savings. These requirements include the following: Long-range (e.g., 3-5 year) reinvestment plans. In March 2013, OMB issued a memorandum that consolidated previously collected IT- related plans, reports, and data submissions, and introduced a new requirement for submitting reinvestment information. Specifically, the memorandum required each of the 26 agencies that participate in the PortfolioStat initiative to describe how they plan to reinvest savings resulting from the consolidation of commodity IT resources (including data centers) in their IRM strategic plan. Fiscal year 2014 reduction and reinvestment plans. OMB’s fiscal year 2014 budget guidance required 27 agencies to propose, in their budget submissions for that fiscal year only, reductions in IT that represented 10 percent of their overall IT spending, and propose reinvestments of at least 50 percent, and up to 100 percent, of the savings. More specifically, agencies were required to reduce agency spending in the following IT areas: duplicative commodity IT investments or contracts; underperforming projects or investments of any type; and lower-value or lower-priority investments of any type. Regarding reinvestments, agencies were required to propose reinvestments that were expected to demonstrate a favorable return on investment (quantitative or qualitative) to the agency within 18 months from the enactment of the fiscal year 2014 appropriations. OMB’s guidance further stated that these proposed reinvestments were to address, among other things, improvements to citizen services or administrative efficiencies, adoption of shared services, and consolidation of commodity IT. Quarterly reinvestment plans. OMB’s March 2013 memorandum also required the 26 agencies that participate in the PortfolioStat initiative to report quarterly on cost savings and avoidances related to the migration to shared services and data center consolidation, among other areas, in their integrated data collection submissions to OMB. As part of these submissions, OMB also required agencies to describe their plans to use the cost savings and avoidances resulting from any cost savings and avoidance initiatives reported. Recognizing the importance of reforming the government-wide management of IT, in December 2014, Federal Information Technology Acquisition Reform provisions (commonly referred to as FITARA) were enacted as a part of the Carl Levin and Howard P. ‘Buck’ McKeon National Defense Authorization Act for Fiscal Year 2015. Among other things, the law includes the following requirements: Agencies, except for the Department of Defense (Defense), shall ensure that CIOs have a significant role in, among other things, programming and budgeting decisions, as well as management, governance, and oversight processes related to IT. For example, agencies (other than Defense) may only enter into contracts for IT and IT services that are reviewed and approved by the agency CIO. OMB shall require, in its annual capital planning guidance, that CIOs certify that IT acquisitions are adequately implementing incremental development. OMB shall issue guidance that requires the CIO to adequately reflect each major IT investment’s cost and schedule performance in the investment evaluation. OMB shall make available to the public a list of each major IT investment including data on cost, schedule, and performance. The General Services Administration (GSA) shall identify and develop a government-wide program, as provided for in the statute, for the acquisition, dissemination, and shared use of software and that allows for the purchase of government-wide software licenses. In addition, the law also includes the following requirements related to the reporting of IT reform-related cost savings: OMB, in consultation with agency CIOs (except for Defense), shall implement a process to assist them in reviewing their IT portfolios, including developing a multi-year strategy to identify and reduce duplication and waste and to identify projected cost savings resulting from the strategy. OMB’s Administrator of the Office of Electronic Government shall submit a quarterly report to specified congressional committees on the cost savings and reductions in duplicative IT investments identified during reviews of agency IT portfolios. Agencies (except for Defense) shall annually report to OMB’s Administrator of the Office of Electronic Government about federal data center inventories and strategies to achieve consolidation, including yearly calculations of investment and cost savings. OMB’s Administrator of the Office of Electronic Government shall develop, and make publicly available, yearly goals for the amount of planned cost savings and optimization improvements achieved through FDCCI, and for each year thereafter, compare reported cost savings against those goals. In June 2015, OMB released guidance on how agencies are to implement the law. OMB’s guidance stated that it is intended to, among other things, assist agencies in aligning their IT resources with statutory requirements; establish government-wide IT management controls that will meet the law’s requirements, while providing agencies with flexibility to adapt to unique agency processes and requirements; clarify the CIO’s role and strengthen the relationship with agency CIOs and bureau CIOs; and strengthen CIO accountability for IT cost, schedule, and performance. Further, the guidance includes several actions agencies are to take within specified time frames to implement a basic set of roles and responsibilities for CIOs and other senior agency officials (referred to as the “common baseline”) needed for the management of IT and to implement the specific authorities described in the legislation. Such roles and responsibilities described include those related to budget formulation and planning, acquisition and execution, and organization and workforce. To implement the common baseline, the proposed guidance includes the following more specific requirements: By August 15, 2015, each agency is to conduct a self-assessment and articulate a plan describing the changes it will make to ensure that all common baseline responsibilities are implemented by December 31, 2015.