OMB wants to know how agencies manage risky IT projects

Agencies now will have to prove to the Office of Management and Budget they can effectively manage their high-risk IT projects, according to federal CIO Vivek Kundra.

Agencies now will have to prove to the Office of Management and Budget they can effectively manage their high-risk IT projects, federal CIO Vivek Kundra has announced.

Agency officials must find the IT projects with the highest risks, then develop plans to improve them and then present those plans to Kundra at TechStat accountability meetings, according to a memo he released today.

Kundra expects to have these detailed reviews of roughly 25 to 30 IT projects across the government. These plans and what Kundra gathers from TechStat are part of the fiscal 2012 budget formulation process, according to his memo.

The improvement plans will justify to OMB officials whether  projects should continue to be funded or be cancelled. Kundra wants to know that an agency can reasonably reduce a project’s risk with a proper scope for the project. Officials will have to define clear results and outcomes that serve the agency’s core mission.

Kundra also wants “a stronger governance structure with explicit executive sponsorship,” according to the memo. “Projects which do not meet these criteria will not be continued,” he added.

Nonetheless, Kundra said everything is on the table when officials look for ways to turn around high-risk projects .

“Agency heads and CIOs at agencies are going to have to make sure that we’re not continuing the practices of the past,” he said.

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As examples of failed IT projects, Kundra offered up three illustrations: The Veterans Affairs Department this month ended its  $400 million Financial and Logistic Integrated Technology Enterprise modernization program for the second time since 1998; The Defense Department’s attempt to build a departmentwide integrated human resources system, for which DOD spent $1 billion  over 12 years, before canceling it; and the FBI’s Virtual Case File project, which the bureau launched because of a contractor's faulty system.

“Ultimately, no one wins when IT projects fail,” Kundra said. “Contractors don’t win, because they’re judged on past performance. The federal agencies don’t win from a project management perspective because we’re not employing the capabilities that we need. And most of all, the American taxpayers don’t win when we waste billions of dollars in IT projects.”

As it stands, Kundra has scheduled meetings with 27 departments and agencies from Aug. 2 to Aug. 18, according to a schedule included in the memo.

This guidance follows the memo issued by OMB Director Peter Orszag in June to reform the government’s efforts to manage IT projects, a part of President Barack Obama’s Accountable Government Initiative.