|
|
|
FEDERAL SECTOR
REPORT
February 2005
IN THIS ISSUE
Finding
Cost Savings through e-Government
Consulting
Services
Home
Page
(c) 2004 by the P2C2 Group,
Inc.
SAVING MONEY THROUGH E-GOVERNMENT
We need to look beyond federal
information technology when
searching
for cost savings and Return on Investment (ROI). Many of the savings
are driven by the broad e-Government agenda, and you may find most of
the
dollars saved are outside of the IT organization. The greatest
potential
for ROI
will often be derived from business process simplification,
agency-level reorganization, consolidation of back-office functions,
and customer self-service.
Unfortunately,
many of the Exhibit 300 business cases for IT budget justifications
consider
only a very narrow range of alternatives. For example, the alternatives
identified may be limited to software alternatives (such as Oracle
versus SQL
Server), technology architectures, or IT acquisition alternatives such
as
inhouse versus outsourcing.
The problem
with using a narrow range of alternatives is that your Cost Benefits
Analysis may
fail to demonstrate an adequate ROI, because most savings and benefits
of e-Gov
accrue outside the IT budget. Further, the cost of
continuing legacy
IT systems is often less than the budget outlay for replacing them.
What's
more, simply selecting one technology alternative over another
(wireless
telecommunications versus satellite) is somewhat bogus for an
Alternatives
Analysis--like saying you'll save money buying a Chevy Suburban rather
than a
Hummer … without justifying why you need to budget for either.
e-Gov is a
way of doing business that has the potential for reinventing the entire
government organization--improving customer service, streamlining
business
processes, and reducing organizational complexity. A simple but
efficient
example is the move by state governments to put many Motor Vehicle
Administration functions online, where automation enables government to
reduce the
cost of field offices and personnel.
The truth
is that the federal government will need to spend MORE on IT to achieve
e-Gov,
but the justification for the investments must be based on inventing a
more
streamlined approach to government programs and agency performance
objectives. For
example, many regionalized functions need to be consolidated into a
single
"back office," located in a low-cost community (same as corporations
do). Many centralized functions can be consolidated and automated.
You have
undoubtedly noticed that customer service in the business world has
become
highly automated, with the unspoken agenda of enabling most customers
to get
information, get services, and get solutions without incurring
additional
business costs for labor. The same approach can be applied to many
government
services, and the cost savings are potentially dramatic.
Following
are just a few thought-starters for identifying where to find the ROI
to
justify investments in e-Gov:
Business
Architecture
-
Consolidation
of organizational structure
-
Simplification
and automation of business processes
-
Conversion
to customer self-service approaches that do not require direct
government
personnel costs
-
Consolidation
of internal IT organizations within the agency
-
Outsourcing
non-core business functions to other government agencies or the private
sector
-
Elimination
of unnecessary business functions
Information
Architecture
-
Elimination
of duplicative or overlapping data systems
-
Use of
enterprise-wide directory services
-
Partnerships
with other agencies having similar needs
-
Outsourcing
data acquisition or maintenance
Technology
Architecture
-
Improving
the cost efficiency of the EA Technology Architecture
-
Use of
Presidential government-wide solutions
-
Consolidation
of systems within the agency
-
Consolidation
of maintenance of similar application systems
Infrastructure
-
Simplifying,
consolidating, and unifying the management of infrastructure
In addition
to outside the box thinking, there are also actions that IT executives
can take
to improve the IT cost performance of agencies, and examples
include:
-
Establishing
an agency Project Management Office to improve the overall efficiency
and
performance of IT investments
-
Making full
use of earned value (EVMS) for cost and schedule performance.
The above
ideas for finding ROI may sound like a tall order. However, with the
mandate
for tightened agency budgets, IT executives in the government may find
that
this is an opportune time to work with line managers in redefining how
agencies
are structured and operate. e-Gov can be part of the solution.
|
VISIT OUR WEBSITE
|
|
CONSULTING
SERVICES
We have the experience, know-how,
and commitment to help you develop smart solutions. Please contact us
for more information.
- e-Gov
- IT
Capital
Investments
- Budget
Justification
- Acquisition
- Plans
and Proposals
- Performance
Evaluation
- Business
Architecture
|
|
|
HOME
PAGE
I get excited when I
talk to federal and contractor personnel who are working hard to make
e-Government a reality. Yet I wish
there was a better way in the federal sector to identify, validate and
apply
innovation and best practices. Many agencies and contractors have
people who
are making exciting contributions, but these advances are often hidden
within
organizations and difficult to locate.
There currently is no
easy way to "Google" a comprehensive catalog of best practices … and
promising practices. It's even more challenging to validate that the
results
are real, and not just wishful thinking. In addition, there is no
consistent
structure for information and case studies about innovation and good
practices, and comparisons between alternative practices are
often difficult.
My own
suspicion is that the federal government could save a billion dollars a
year on
IT simply by making it easy for the federal sector to find, compare and
implement the most appropriate best practices.
|
Winter
finally arrived in Washington, DC, but my son wasn't satisfied: He flew
to Connecticut to step into a knee-high New England blizzard.
The
photo is courtesy of CNN archives.
|
|
Best
wishes,
Jim Kendrick
4101 Denfeld
Avenue
Kensington, MD
20895
301-942-7985
NEWSLETTER ARCHIVE
|
|
|
|
The P2C2 Group, Inc.
4101 Denfeld Avenue | Kensington, MD 20895
Point of Contact: Jim Kendrick, President
e-mail: kendrick@p2c2group.com
phone: 301-942-7985 | fax: 301-942-7986 |
|
|
|
