INTERNAUT: LOB impact? You ain't seen nothing yet

 Just when federal agencies thought they were catching up with the Office of Management and Budget's six existing Line of Business initiatives, they now have three more LOBs to consider. These recently announced LOBs could well have the greatest streamlining effect of any of the initiatives thus far. What's more, agency IT budgets could see significant cuts in the years ahead if they succeed.


First a little history. The goals for the LOBs, first put into action in 2004, are to support the President's Management Agenda, expand e-government, promote interagency sharing of data and resources, and reduce the overall cost of government by eliminating duplication of systems and services.


The current LOBs are Case Management, Federal Health Architecture, Financial Management, Human Resources Management, Grants Management and Information System Security. The new LOBs focus on Budgeting, IT Infrastructure and Geospatial information.


While the Geospatial LOB's goal'to create a common architecture for collecting and storing geospatial data that all agencies can use'is admirable, its impact doesn't loom as large as that of other LOBs.


Of the new initiatives, the Budgeting and IT Infrastructure directives will have the greatest long-term impact. To understand their potential influence, just look at the recent Report on Information Technology Spending released with the 2007 budget. All projects (the numbered line items in overall federal IT budgets) must be tied directly to a federal line of business initiative. Standardizing the budgeting process itself into an LOB will help further leverage this requirement, making it easier to understand the costs and benefits associated with each proposal. Federal IT managers need to be ready for this significant change because it will affect the way they seek new funding.


The Budgeting LOB will seek common solutions for the budget work that federal agencies perform. The idea is to standardize both the processes and the way data is collected, tagged and stored. This will include developing common expenditure codes that all agencies can use. It will allow the government to track expenses by type and develop diagnostic tools to track specific expenditures. Eventually, the effort would stretch from budget formulation through financial management to performance measurement. Most important, the effort will help agencies align programs with specific outcomes while tracking budget levels and actual costs.


And that brings us to the next piece of the cost-cutting puzzle: standardizing IT infrastructures for those future project proposals. The IT Infrastructure LOB will define common performance measures for systems, services levels and even projected costs. It will include advice and support for technology transitions, including best practices for specific functions. Over the long term, it could mean more consolidation and geo-disbursed IT outsourcing (think in terms of service centers).


The goal is to trim about one-fifth of future IT budgets, permitting agencies to concentrate on core mission tasks rather than IT service management. The relatively flat funding several agencies saw in the proposed 2007 budget reflects the impact that ongoing IT program consolidation is already having. And new projects will have to face the challenge of OMB's stringent review process.


Former GCN writer Shawn P. McCarthy is senior analyst and program manager for government IT opportunities at IDC of Framingham, Mass. E-mail him at smccarthy@idc.com.

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