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FEDERAL SECTOR REPORT

October 2004

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Plan Ahead for IT Investment Success
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(c) 2004 by the P2C2 Group, Inc.
 

PLAN AHEAD 

Don't relax in October. If you are involved in the Capital Planning and Investment Control (CPIC) process prescribed by OMB's Circular A-11, it's time to plan how to be successful with your future federal budgets for information technology (IT).
 
Sure, we all feel like relaxing after the September deadlines for submitting proposed Exhibit 53s and Exhibit 300s to the Office of Management and Budget (OMB). But there's no time to waste: What you do next will affect your financial health, and a good first step is to develop three "to do" lists:
  • Defensive Actions, to avoid short-term problems and rude crises
  • Tactical Actions, to prepare for next year's federal budget cycle 2007
  • Strategic Actions, to align long-term capital investment plans with your future vision for business, information, and technology architecture.
Once you have your lists, do a reality check with your management team and stakeholders: Omissions? Right priorities? Resources for executing the actions? Of course an even better idea is to call in a top-notch  consulting firm to facilitate the process and nail down follow-through.
 
Following are thought starters for your action lists, but adapt, add, change, and modify to fit your situation:
 
Defensive Actions
 
Identify what you have promised to agency heads and OMB. You may have made promises concerning short-term actions in Plan of Action & Milestone (POA&M) tables, Exhibit 300s, EVMS milestones, and PART reviews that include due dates during September - December 2004. Make sure these happen on schedule, or you may have a very unhappy Thanksgiving as you engage in the budget pass-back process.
 
Weaknesses in September's Exhibit 300s and 53s.  You may have serious weaknesses in your capital investment and IT budget documents that could put you on OMB's "watch list." Weak compliance with security requirements is a leading cause, but there are other hot spots including performance-based contracting (acquisition strategy) and Earned Value Management System (EVMS). Take immediate action to strengthen any weaknesses, and you can spare yourself the burden of taking the heat for watch-list projects.
 
Performance schedules for first quarter of the new fiscal year. The performance of major federal IT investments are subject to increased scrutiny. Make sure your IT projects start off the new fiscal year on schedule and in budget. Accountability for performance involves both the Agency and the contractor(s).
 
GAO and IG reports. Did oversight agencies spot problems with your IT projects or investment management? If so, be pro-active about resolving these issues.
 
Tactical Actions
 
CPIC schedule for investments. Sound CPIC planning and management is a year-long process, as I've written repeatedly. October is the time for all Agency IT projects to define a year-long CPIC schedule: 
  • Initiate strategic planning and improve alignment with the Enterprise Architecture
  • Improve alignment of performance goals with output and results measures
  • Replace out-of-date alternatives analyses, and do market research for a real-world cost benefits analysis
  • Update or replace aging risk management or information security plans
  • Update the E-Gov plan
  • Fine-tune EVMS
  • Conduct operational analysis reviews for Steady State investments
  • Identify which contracts are due for initiation or re-competition during the fiscal year, and make sure these are aligned with performance-based contracting and EVMS
  • Plan the full CPIC and SDLC drill for new investments.
Keyin Lock, image 
October is the beginning of your federal fiscal year, and it's time to plan for IT success with:
  • Defensive Actions
  • Tactical Actions
  • Strategic Actions
Don't wait for appropriations. The clock is ticking now. 

Investment selection process for current and next fiscal year. It's time to advance your Pre-Select CPIC process--identifying business needs, considering non-technology as well as IT solutions, conducting market research, and  prioritizing potential investments.
 
Performance measurement. An alarming number of IT investments cannot quantify what they actually accomplish. Set up metrics, and go way beyond IT process indicators. Simply stating 99.9% uptime is not sufficient these days. Congress wants to know whether that system was effective in supporting the agency mission that improved citizen health, made air transportation more secure, or helped students get loans for education.
 
Partnerships. OMB gives funding priority to investments that use partnerships to cut costs or improve services to citizens. However, truly effective partnerships require months or years of planning. If you want a dynamite partnership for an investment that will go to OMB next summer, you had better get to work now.
 
Competitive Sourcing. Much of the government's business architecture is still rooted in the 20th century and pre-date e-Gov and today's potential for efficiency. Either conducting a formal A-76 study or completing an informal review has the potential of achieving very large cost savings, which can pay for IT modernization and e-Gov. The benefit of the A-76 paradigm is that it forces agencies to update their business process--to define a Most Efficient Organization (MEO). This alone can produce dramatic breakthroughs, even if the resulting solution is not outsourced but kept in-house within the government. Again, conducting competitive sourcing reviews takes time, and you need to start work at the beginning of the fiscal year.
 
Annual Enterprise-Level Plan for CPIC. Major IT investments usually bubble up on a project-by-project basis, but agencies need an enterprise-wide budget strategy for next summer's budget cycle. Certain tools like Balanced Scorecard methodology, ProSight, and Expert Choice can help, but the process takes time, fact finding, focus, and buy-in.
 
Strategic Actions
 
Re-imaging the role of IT in the enterprise.  You need a strategic plan that provides a detailed vision of the target business, information, and technology architecture. What you need is not the usual blah-blah document iterating platitudes, but a hard-core roadmap that will redefine how government performs its mission and serves its customers. It needs to be specific enough to guide a long-term capital investment plan. It needs to lay out a framework for redefining the organizational structure and processes that IT will support. It needs to have long-term budget goals.
 
Linkage to enterprise strategic plans, performance objectives. It is simply a portfolio of resource vehicles that should drive the organization toward its goals and measurable objectives. October is the time to begin laying out how IT spending is tied to strategic plans and performance objectives.
 
Doing more with fewer dollars.  It doesn't take a rocket scientist to figure out that Congress will eventually be forced to deal with the budget deficit and trim overall government spending. Some programs will be budget winners and losers in the process, but all programs will be held accountable to squeeze greater results and more cost efficiency out of every dollar. October is a good time to begin figuring out how you can measurably boost your performance. To paraphrase, to those who have (investment results) will be added; to them who do not will be taken away.

There you have it. October is the time to get started.


Much of your budget success with IT depends on planning now. Market research, public-private partnerships, and competitive sourcing studies require months of preparation.



























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CONSULTING SERVICES
 
The P2C2 Group is an independent consulting practice that serves the Federal Sector in the areas of:
  • Strategy
  • Capital investments and budgets
  • Acquisition
  • Evaluation
  • CIO program support 
Please contact us at 301-942-7985 for more information or e-mail kendrick@p2c2group.com


HOME PAGE
 
Whew! It's been a wonderfully busy year, and a number of successful projects have come to a successful conclusion. One of the more satisfying aspects has been work for a broad cross-section of federal agencies and programs, enabling the P2C2 Group to study alternative methods for managing government programs and information technology.
 
Best wishes,

Jim Kendrick
4101 Denfeld Avenue
Kensington, MD 20895

301-942-7985

 
 

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