One of the most fundamental ways in which agencies can reduce costs while increasing efficiency is to ensure they understand their system architecture and information technology ecosystem at a very granular level. With this enhanced visibility into your infrastructure, applications, and systems, agencies can then make correlations from these assets back to mission objectives in order to gauge where there is potential to eliminate redundancy and waste.
While this might seem like something that every CIO should know, it’s amazing how many of us, when we’re in the weeds of our every day, lose sight of the bigger picture. For example, do we have a full account of all applications being used, or under-used, by the agency throughout all of its sub-departments? Do we know what systems and applications our colleagues are investing in? Does an application invested in by another business unit manager offer superior performance? Could my department team up with another that uses the same application to streamline the contracting process and drive out costs from our business processes?
It’s these types of questions that are the essential in IT portfolio management, an area that many government agencies are just beginning to tackle. As always, some agencies will be ahead of others. I was fortunate to moderate a panel at the ModernGOV Summit that Software AG Government Solutions hosted with FCW. In the panel, we were able to tap into the expertise and experiences of Kevin Schmitt, IT Portfolio Manager, Planning and Portfolio Management, Office of the Chief Information Officer, for the Department of the Interior who has pioneered portfolio management for his organization, along with Dwayne Jackson, Managing Partner at Software Tech Enterprises, Inc., who has worked with several agencies, including the Department of Commerce, to initiate portfolio management projects.
Kevin Schmitt shared that the Department of Interior’s initial drive to manage applications was to meet compliance goals handed down by OMB and FITARA, which places the onus on an agency’s CIO to approve all budget and acquisitions requests for IT purchases to ensure that they were meeting mission goals. As part of the FITARA process agencies must conduct a portfolio audit to reduce duplication and consolidate functionality. As Kevin suggested meeting FITARA obligations might be the impetus, but the program wouldn’t be meaningful or successful if he and his team were just meeting the letter of the requirement; certainly an audit could be performed and arbitrary cuts made, but so much more could be accomplished with a systematic planning and management platform. For example, the Department of the Interior uncovered that they were running seven different accounting systems within the agency. If they could cut the number of accounting systems in half, the cost savings from not only licenses and renewals but the ability to integrate between departments would be significant. In identifying areas of redundancy such as this, or by creating contract renewal timelines that consolidate acquisition activities, costs can be driven out of OPEX.
While Kevin’s focus during the panel was on “the how” of implementation, Dwayne’s perspective, as a trusted advisor to agencies, was on the preconditions to success when looking to implement change. Far from starting with IT, or even business, portfolio management starts with an executive sponsor who can “set the vision and lead to the vision,” educate stakeholders, and find champions that can help drive changes in behavior. Without this first step to “combat resistance” a portfolio management exercise is almost always confined to being a compliance exercise rather than part of a fundamental shift in agency operations.
In the end, approaching the issue of portfolio management very differently, both speakers agreed on three fundamental best practices to deliver a successful IT portfolio management solution:
- An executive sponsor, who can share the vision with peers and subordinates.
- A trusted IT partner that can bring the tools and knowledge to help identify the sources of duplication and isolate cost bases for operations.
- And an ability to think small, not boil the ocean, and be agile; in other words, the wisdom to start small and produce results quickly.
Interested in learning more about IT portfolio management? Here’s a good place to start…