Defense IRM:

Investments at Risk for DOD Computer Centers

AIMD-97-39: Published: Apr 4, 1997. Publicly Released: Apr 4, 1997.

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Pursuant to a congressional request, GAO reviewed: (1) the Department of Defense's (DOD) plans to consolidate, outsource, and modernize its computer center operations; and (2) whether DOD has an effective framework in place for making and executing these decisions. GAO did not validate the accuracy of the information provided by DOD on the numbers and costs of computer centers, the alternative analyses, funding plans, and processing capacities.

GAO noted that: (1) DOD has recognized the need to continue reductions in the cost of its computer centers' operations through consolidation, modernization, and outsourcing, but it has not yet established an effective framework for making these decisions; (2) this framework would include departmentwide policies and procedures critical to the success of its efforts to improve computer centers; (3) these policies and procedures would establish targets for how many computer centers DOD actually needs, define how mainframes and mid-tier computer operations should be consolidated, and identify the numbers and skill mix of staff that are required to operate the centers, and what constitutes an optimum computer center; (4) DOD also has no mechanism for ensuring that the best money-saving opportunities have been considered by the individual services and components or that consolidation efforts will conform to federal requirements or even meet the needs of DOD as a whole; (5) as a result, DOD services and components have developed individual strategies for consolidating and modernizing their computer centers that are inconsistent and contradictory to DOD as a whole and may well cause DOD to waste millions of dollars in computer center expenditures; (6) in addition, the consolidation strategies of the military services and DOD components did not always fully address critical planning elements required by the Office of Management and Budget (OMB) requirements that could help reduce the risk of waste, including alternative analyses, high-level implementation plans, and funding plans; (7) further, GAO found that the OMB and departmental guidance, particularly addressing mid-tier computer centers, was unclear; (8) this resulted in inconsistent interpretation and reporting for these centers; (9) therefore, OMB and DOD do not have assurance that the computer consolidation strategies are sound; (10) without better management over the implementation of its computer center strategies, DOD at best will only achieve optimization at the component level and forgo optimization for DOD as a whole; and (11) moreover, DOD's chief information officer (CIO) is now required by the Paperwork Reduction Act of 1995, Clinger-Cohen Act of 1996, and the Fiscal Year 1997 DOD Authorization Act to develop and implement a plan for a management framework with policies and procedures as well as effective oversight mechanisms for ensuring that major technology related efforts, such as the computer center consolidations, conform to departmentwide goals.

Recommendations for Executive Action

  1. Status: Closed - Not Implemented

    Comments: DOD's draft response indicates continued nonconcurrence with this recommendation. DOD officials stated that they do not believe GAO's findings warranted limiting capital investments until the plan was completed.

    Recommendation: Until this plan is approved by the Secretary, the Secretary of Defense should limit any capital investments in the Department computer centers to investments that meet critical technology needs to operate the DOD computer centers. DOD's CIO should certify that these investments comply with departmentwide goals and technical standards.

    Agency Affected: Department of Defense

  2. Status: Closed - Implemented

    Comments: DOD incorporated this recommendation into its policies and procedures on April 6, 2001, when the Deputy Secretary of Defense issued a memorandum to the senior DOD leadership institutionalizing DOD CIO Guidance and Policy Memorandum (G&PM) No. 11-8450, DOD Global Information Grid Computing. Further, the Defense Management Council established a performance contract with the DOD computing center for FY2001-2005. This contract includes performance metrics.

    Recommendation: As a basis for this plan, and for future decisions concerning consolidation, modernization and outsourcing of computer centers, DOD's CIO should develop policies and related procedures that address what constitutes an optimum computer center in terms of processing capacity and staff numbers and skills.

    Agency Affected: Department of Defense: Office of the Assistant Secretary for Command, Control, Communications, and Intelligence

  3. Status: Closed - Implemented

    Comments: DOD incorporated this recommendation into its policies and procedures on April 6, 2001, when the Deputy Secretary of Defense issued a memorandum to the senior DOD leadership institutionalizing DOD CIO Guidance and Policy Memorandum (G&PM) No. 11-8450, DOD Global Information Grid Computing. Further, the Defense Management Council established a performance contract with the DOD computing center for FY2001-2005. This contract includes performance metrics.

    Recommendation: As a basis for this plan, and for future decisions concerning consolidation, modernization and outsourcing of computer centers, DOD's CIO should develop policies and related procedures that address how many computer centers are needed.

    Agency Affected: Department of Defense: Office of the Assistant Secretary for Command, Control, Communications, and Intelligence

  4. Status: Closed - Implemented

    Comments: DOD incorporated this recommendation into its policies and procedures on April 6, 2001, when the Deputy Secretary of Defense issued a memorandum to the senior DOD leadership institutionalizing DOD CIO Guidance and Policy Memorandum (G&PM) No. 11-8450, DOD Global Information Grid Computing. Further, the Defense Management Council established a performance contract with the DOD computing center for FY2001-2005. This contract includes performance metrics.

    Recommendation: As a basis for this plan, and for future decisions concerning consolidation, modernization and outsourcing of computer centers, DOD's CIO should develop policies and related procedures that address which of its computer center operations are inherently governmental and/or require component-unique centers solutions, and thus cannot be consolidated or outsourced.

    Agency Affected: Department of Defense: Office of the Assistant Secretary for Command, Control, Communications, and Intelligence

  5. Status: Closed - Implemented

    Comments: DOD incorporated this recommendation into its policies and procedures on April 6, 2001, when the Deputy Secretary of Defense issued a memorandum to the senior DOD leadership institutionalizing DOD CIO Guidance and Policy Memorandum (G&PM) No. 11-8450, DOD Global Information Grid Computing. Further, the Defense Management Council established a performance contract with the DOD computing center for FY2001-2005. This contract includes performance metrics.

    Recommendation: As a basis for this plan, and for future decisions concerning consolidation, modernization and outsourcing of computer centers, DOD's CIO should develop policies and related procedures that address how DOD should compare its computer center services with those of other public-sector and private-sector services in terms of cost, speed, productivity, and quality of outputs and outcomes.

    Agency Affected: Department of Defense: Office of the Assistant Secretary for Command, Control, Communications, and Intelligence

  6. Status: Closed - Implemented

    Comments: DOD incorporated this recommendation into its policies and procedures on April 6, 2001, when the Deputy Secretary of Defense issued a memorandum to the senior DOD leadership institutionalizing DOD CIO Guidance and Policy Memorandum (G&PM) No. 11-8450, DOD Global Information Grid Computing. Further, the Defense Management Council established a performance contract with the DOD computing center for FY2001-2005. This contract includes performance metrics.

    Recommendation: As a basis for this plan, and for future decisions concerning consolidation, modernization and outsourcing of computer centers, DOD's CIO should develop policies and related procedures that address which cost and performance goals are relevant for comparing departmentwide alternatives.

    Agency Affected: Department of Defense: Office of the Assistant Secretary for Command, Control, Communications, and Intelligence

  7. Status: Closed - Implemented

    Comments: DOD incorporated this recommendation into its policies and procedures on April 6, 2001, when the Deputy Secretary of Defense issued a memorandum to the senior DOD leadership institutionalizing DOD CIO Guidance and Policy Memorandum (G&PM) No. 11-8450, DOD Global Information Grid Computing. Further, the Defense Management Council established a performance contract with the DOD computing center for FY2001-2005. This contract includes performance metrics.

    Recommendation: DOD's CIO should establish or incorporate within its existing processes, as practical, the necessary oversight to ensure that the above recommended departmentwide plan and future computer center consolidation, modernization, and outsourcing decisions: (1) are being developed in accordance with the above policies and procedures; (2) are based on a sound analysis of alternatives; and (3) consider the goals and needs of the entire department.

    Agency Affected: Department of Defense: Office of the Assistant Secretary for Command, Control, Communications, and Intelligence

  8. Status: Closed - Implemented

    Comments: OMB issued a letter to DOD in September 1997 that supplemented and clarified guidance on OMB Bulletin 96-02. However, OMB did not clarify its position in regard to mid-tier consolidation criteria and OMB officials told GAO that they believe the criteria are sufficient.

    Recommendation: The Director, OMB, should clarify its Bulletin, particularly in regard to mid-tier consolidation criteria and its intent to have an integrated DOD submission.

    Agency Affected: Executive Office of the President: Office of Management and Budget

  9. Status: Closed - Not Implemented

    Comments: DOD officials stated that they do not believe an integrated plan is needed because it has already consolidated so many computer centers.

    Recommendation: The Secretary of Defense should direct the Department's CIO to develop an integrated, departmentwide plan for improving the cost operations of its computer centers.

    Agency Affected: Department of Defense

  10. Status: Closed - Implemented

    Comments: On September 29, 1997, OMB issued a letter to DOD requiring a consolidated submission, its strategy, and plans as recommended by GAO. On December 24, 1997, DOD provided to OMB its initial information and plans to provide updated information every six months.

    Recommendation: The Director, OMB, should require DOD to replace its prior multiple submissions in response to this new guidance with an integrated departmentwide submission that contains a departmentwide inventory of computer centers, a departmentwide consolidation strategy, and a departmentwide implementation plan.

    Agency Affected: Executive Office of the President: Office of Management and Budget

 

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