GAO-16-375SP: Information technology: 35. Federal Mobile Telecommunications

Information technology > 35. Federal Mobile Telecommunications

In order to achieve substantial government-wide savings, federal agencies should establish better controls on mobile device spending, and the Office of Management and Budget should monitor progress in achieving these savings.

Why This Area Is Important

In 2012, the Office of Management and Budget (OMB) reported that the federal government spent approximately $1.2 billion annually on about 1.5 million mobile devices and associated services.[1] Federal agencies use mobile devices to provide their employees and contractors flexibility to perform their work anywhere at any time. Given that the use of mobile technology in the federal government was expected to increase, OMB identified the potential for achieving efficiencies and reducing spending in this area. Specifically, OMB identified potential savings of about $388 million in fiscal years 2013 through 2015 by consolidating or eliminating mobile device contracts.

An executive order and OMB strategy provided direction and guidance on controlling mobile device spending. Specifically, in November 2011, the President issued an executive order on promoting efficient spending, which required agencies to, among other things, assess current federal employee IT device inventories and usage, including mobile devices, and establish controls to ensure they are not paying for unused or underused devices or services.[2] In May 2012, OMB issued a strategy, known as the Digital Government Strategy, a key objective of which is to move agencies away from purchasing mobile technology in a fragmented manner at the component level to purchasing the technology at an agency-wide level (i.e., centralized) and eventually government-wide level.[3] To help achieve this objective, OMB required agencies to develop, by November 2012, an enterprise-wide inventory of their wireless service contracts and to maintain it. Federal internal control standards[4] and GAO’s June 2006 work on telecommunications inventories provide agencies guidance on implementing these requirements.[5]



[1]OMB has not reported an updated estimate of the federal government’s spending on mobile devices and services.

[2]Exec. Order No. 13589, Promoting Efficient Spending, 76 Fed. Reg. 70863 (Nov. 15, 2011).

[3]OMB, Digital Government: Building a 21stCentury Platform to Better Serve the American People (Washington, D.C.: May 2012), commonly referred to as the Digital Government Strategy.

[4]OMB, Circular A-123, Management’s Responsibility for Internal Control (Dec. 21, 2004); GAO, Standards for Internal Control in the Federal Government, GAO/AIMD-00-21.3.1 (Washington, D.C.: November 1999); and GAO, Internal Control Management and Evaluation Tool, GAO-01-1008G (Washington, D.C.: August 2001). See also GAO, Standards for Internal Control in the Federal Government, GAO-14-704G (Washington, D.C.: September 2014), which is effective beginning fiscal year 2016.

[5]In June 2006, GAO identified establishing a telecommunications inventory as a key telecommunications transition planning practice and noted the importance of establishing and maintaining an inventory for purposes in addition to transition planning. GAO identified the transition planning practices through research of literature and interviews with those with experience in telecommunications transitions, including industry experts, telecommunications vendors, and other private sector companies.

What GAO Found

In May 2015, GAO reported on weaknesses in 15 selected agencies’ controls on mobile device spending.[1] GAO found that most of the agencies reviewed did not have an inventory of mobile devices and associated services that could be used to assess device usage. Only 5 of the 15 agencies had complete device and service inventories at either the enterprise level or at the components GAO reviewed. The remaining agencies either did not have inventories, or those inventories did not account for all devices and services. Similarly, only 1 of the 15 agencies had documented procedures for monitoring spending by reviewing devices and associated service plans for overuse, underuse, or zero use, which are key indicators of potential inefficient use. Eleven agencies had procedures that either addressed some of the potential aspects of inefficient use or were incompletely documented. Three agencies did not have documented procedures. The table below shows the number of agencies that followed guidance related to (1) establishing a mobile device and service inventory, and (2) procedures for monitoring mobile technology spending.

Number of 15 Selected Agencies That Followed Guidance on Managing Mobile Devices and Services

 

Fully satisfied

Met some
but not all

Did not satisfy

Inventory (devices and services)

5

7

3

Procedures

1

11

3

Source: GAO analysis of agency data as reported in GAO-15-431. | GAO-16-375SP

GAO also reported that of the 15 agencies reviewed, 6 agencies collected mobile device contract information and reported it to OMB in the quarters between May and November 2014, in accordance with OMB’s 2012 strategy and guidance. The remaining 9 agencies’ reports were missing key data or were not adequately maintained.

Agencies cited several reasons for these weaknesses, including a lack of understanding of the relevant guidance, the use of unwritten procedures, and a continued belief in the effectiveness of decentralized management. Without an inventory that includes each device and associated service limits and rates, as well as documented procedures to assess device usage relative to service rate plans, agencies have a limited ability to monitor device usage and determine if a device should be canceled or moved to a more cost-effective service plan. Further, without a reliable inventory of mobile service contracts, agencies are less likely to identify opportunities for consolidation, and thus are less likely to achieve cost savings.

Highlighting the potential to reduce costs, GAO also found a variance in the rates that agencies paid for the same services. Specifically, there was a variance of about $53 between the lowest and highest rates the selected agencies paid for unlimited voice, data, and text. Given the variance, cost savings could be realized by taking steps such as consolidating contracts and leveraging economies of scale to reduce costs.

Finally, although OMB identified a goal for financial savings related to mobile devices and services, it has not measured progress toward that goal, as called for by leading practices in performance management.[2] Instead, an OMB analyst said that OMB provides agencies information, quarterly, on rates paid by other agencies because it believes such information is more effective at convincing agencies to achieve savings. As of November 2015, OMB reported that 11 agencies had action items related to mobile contracts. OMB further reported that it has seen prices fall across the government, and that some agencies have made significant progress. However, without measuring progress toward its goal, OMB has little assurance that its approach is effective.



[1]The agencies were selected based on reported telecommunications spending and include the Departments of Agriculture, Commerce, Defense, Health and Human Services, Homeland Security, the Interior, Justice, State, Transportation, the Treasury, and Veterans Affairs; the Environmental Protection Agency; the General Services Administration; the National Aeronautics and Space Administration; and the Social Security Administration.

[2]GAO, Data Center Consolidation: Reporting Can Be Improved to Reflect Substantial Planned Savings, GAO-14-713 (Washington, D.C.: Sept. 25, 2014); Aviation Weather: Agencies Need to Improve Performance Measurement and Fully Address Key Challenges, GAO-10-843 (Washington, D.C., Sept. 9, 2010); NextGen Air Transportation System: FAA’s Metrics Can Be Used to Report on Status of Individual Programs, but Not of Overall NextGen Implementation or Outcomes, GAO-10-629 (Washington, D.C.: July 27, 2010); OMB, Guide to the Program Assessment Rating Tool (Washington, D.C.: January 2008); and General Services Administration, Performance-Based Management: Eight Steps To Develop and Use Information Technology Performance Measures Effectively (Washington, D.C.: 1996).

Actions Needed

In May 2015, GAO made recommendations to each of the agencies reviewed to help ensure their ability to effectively manage spending on mobile devices and services. Specifically, GAO recommended the following:

  • Ten of the 15 agencies should ensure that an inventory of mobile devices and services is established agency-wide (i.e., all components’ devices and associated services are accounted for).[1]
     
  • Nine of the 15 agencies should ensure that a reliable and current agency-wide inventory of mobile service contracts is developed and maintained.[2]
     
  • Fourteen of the 15 agencies should ensure that procedures to monitor and control spending on mobile devices and services are established agency-wide. Specifically, they should ensure that procedures include assessing devices for zero, under, and over usage; personnel with authority and responsibility for performing the procedures are identified; and the specific steps to be taken to perform the process are documented.[3]

In addition, to better enable OMB to oversee agency efforts to consolidate mobile telecommunications contracts, GAO recommended the following:

  • OMB should measure and report progress in achieving its goal of mobile device and service cost savings through consolidation.

The actual cost savings associated with these actions is unknown, as the 2012 estimate from OMB of about $388 million in potential savings during fiscal years 2013 through 2015 has not been updated or reassessed. As a result, GAO cannot quantify potential financial benefits associated with the recommended actions. GAO believes savings could potentially be significant, given OMB’s original estimate.

Taking these actions—34 across the selected agencies and OMB—should better position agencies to meet OMB’s goal of reducing costs by moving toward a less fragmented approach to acquiring the technology. Further, by measuring and reporting progress agencies are making in meeting this goal, OMB could enhance its ability to oversee these efforts and improve agencies’ management of their spending on mobile devices and services.



[1]GAO did not make recommendations to the Departments of Health and Human Services, Justice, Transportation, and Veterans Affairs; and the General Services Administration.

[2]GAO did not make recommendations to the Departments of Agriculture, Transportation, the Treasury, and Veterans Affairs; the General Services Administration; and the Social Security Administration.

[3]GAO did not make a recommendation to the Department of Defense.

How GAO Conducted Its Work

The information contained in this analysis is based on findings from the May 2015 report listed in the related GAO products section. GAO selected 15 major agencies based on reported telecommunications spending. It compared each agency’s mobile device and service inventory to an executive order on promoting efficient spending and sound telecommunications transition practices identified in a June 2006 GAO report. GAO also evaluated the extent to which agencies developed and maintained mobile service contract inventories, relative to OMB requirements. In addition, GAO assessed the agencies’ procedures for monitoring and controlling mobile device and services spending relative to the executive order and OMB internal control standards. GAO also compared OMB’s oversight of agencies’ progress toward meeting the Digital Government Strategy’s goal of purchasing mobile technology at the agency level (and ultimately government-wide) with leading management practices. To determine the rates agencies were paying for mobile services, GAO analyzed the agencies’ most recent quarterly mobile service contract reports to OMB, as of November 2014. To assess the reliability of the cost data in the reports, GAO identified obvious issues, such as missing or questionable values, and reviewed each agency’s responses to questions about efforts to ensure the reports are accurate and complete. GAO determined the cost data were sufficiently reliable for the purposes of its report. GAO also interviewed agency and OMB officials.

Agency Comments & GAO Contact

In commenting on GAO’s May 2015 report, 13 of the 15 selected agencies generally agreed with GAO’s recommendations, 1 agency (the Department of Defense) partially agreed, and 1 (the Department of the Treasury) stated that it did not have any comments. In addition, OMB generally agreed with GAO’s recommendation. The Department of Defense stated that it agreed with the merits of establishing an inventory of mobile devices and services but that maintaining it comes at considerable expense and effort. GAO disagreed and noted that the inventory need not be generated centrally at the headquarters level; the department can compile a comprehensive inventory using components’ complete inventories. Accordingly, GAO maintained that a comprehensive inventory is critical to managing mobile device costs.

Since GAO issued its report, one agency, the General Services Administration, has addressed the recommendation made to it by including in its procedures steps to assess devices for under and over usage. By including these steps in its procedures, the General Services Administration is better able to ensure that it is sufficiently controlling spending on mobile services.

Recently, GAO provided a draft of this report section to OMB and the 15 selected agencies for review and comment. In response, OMB stated that it generally concurred, nine of the agencies stated that they have no comment, and four described steps they are taking and plan to take to address GAO’s recommendations. In addition, OMB and the Departments of Homeland Security and the Treasury provided technical comments, which were incorporated, as appropriate. One agency (the Environmental Protection Agency) did not provide comments.

For additional information about this area, contact Carol R. Cha at (202) 512-4456 or chac@gao.gov.