OMB ups the ante on agency IT projects

'We are trying to look at the business case from a holistic approach,' Bill McVay of OMB's Office of Information and Regulatory Affairs said. 'IT projects are a part of the overall budget discussion and not separated out.'

Henrik G. DeGyor

The Office of Management and Budget has thrown down the gauntlet on agencies' IT investments'just in time for the fiscal 2004 budget cycle.

'We are asking agencies questions like never before,' said Bill McVay, a senior policy analyst for the Information Policy and Technology Branch of OMB's Office of Information and Regulatory Affairs. 'They must look outside themselves and think about the rest of government to see if there are other agencies doing similar work.'

Under orders from director Mitchell E. Daniels Jr., OMB officials are analyzing all IT projects that use Web technology or are part of an agency's e-government or e-business plan, regardless of size or cost. OMB also is applying the first version of the Federal Enterprise Architecture's Business Reference Model and expanding a requirement for the use of commercial software.

The new practices will give OMB a much clearer picture of the $52 billion federal IT portfolio, officials said.

OMB's analyses focus on the business cases agencies must submit to get their projects funded. OMB required agencies to submit business cases for 2004 by Sept. 9. Agencies have increased the number of cases submitted, although McVay said earlier this month'well past the due date'proposals were still pouring in.

McVay spoke at an enterprise architecture conference sponsored by Post Newsweek Tech Media and the Digital Government Institute.

'We are trying to look at the business case from a holistic approach,' McVay said. 'IT projects are a part of the overall budget discussion and not separated out.'

McVay said OMB is emphasizing business cases this year because it did not receive them for $34 billion worth of IT projects for 2003.

'The director told us we need to fix that lack of visibility in 2004,' McVay said. OMB has changed the definition of a major project in Circular A-11, which sets the rules by which agencies submit budget information, to give government managers a better idea of where agencies are making investments.

Projects at risk

McVay said that in 2003 agencies submitted only 1,300 business cases for IT projects costing $18 billion'out of the $52 billion worth of total projects'and less than half of the business cases were accepted immediately. The rest were put on an 'at-risk list,' McVay said. Many subsequently were taken off the list, he said, but for the next fiscal year OMB wants agencies to do a better job of integrating their business cases with their capital planning processes and enterprise architectures.

OMB's new tactics also force agencies to be more discriminating in their analysis of IT investments.

The oversight agency is putting each business case through a lengthy review process that includes analysis by members of OMB's IT and e-government, and information policy working groups. McVay said OMB expects to have a better grasp of IT investments by early January. Many agencies have submitted a bigger pile of business cases for 2004 than 2003. The Energy Department, for instance, proposed more than 100 IT investments worth more than $2.4 billion last month after only sending in 14 worth about $1.2 billion in 2003, said Karen Evans, the department's CIO.

McVay said OMB is working with agencies to understand the people and processes involved in IT projects, not just the hardware and software.

'This way we are requiring everyone who has a stake in the project to be at the table from the beginning,' McVay said. 'We will look at the business case and ask if there are organizational changes that need to occur so that this IT project can deliver the benefits of the program.'

Part of the exercise, McVay said, is to use the Business Reference Model, the first part of the Federal Enterprise Architecture. The reference model lists all the lines of business the government pursues in order to find duplicative projects and promote collaboration.

The first step is to analyze agency data. OMB required agencies to submit their business cases through an Extensible Markup Language schema that puts the information in a central database, McVay said.

During the data analysis, OMB officials also will look for opportunities to use commercial software with the federal business rules already embedded in the program, McVay said.

He added that agencies should buy applications that have proved to work in the private sector and re-engineer their business processes instead of trying to adapt the software.

'In the past, we asked agencies to use commercial software when possible, but for 2004, we took it much further,' McVay said. 'We want agencies to look not just at IT, but also at people and processes to bring efficiencies to their work.'

McVay said OMB will present the business case information with the president's budget in February. It will include performance information, such as three-year funding data, goals of the agency, project performance goals and measures of success, for all major IT projects.

Reader Comments

Please post your comments here. Comments are moderated, so they may not appear immediately after submitting. We will not post comments that we consider abusive or off-topic.

Please type the letters/numbers you see above