Data Center Consolidation:

Strengthened Oversight Needed to Achieve Cost Savings Goal

GAO-13-378: Published: Apr 23, 2013. Publicly Released: May 14, 2013.

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What GAO Found

The 24 agencies participating in the Federal Data Center Consolidation Initiative (FDCCI) made progress towards the Office of Management and Budget's (OMB) goal to close 40 percent, or 1,253 of the 3,133 total federal data centers, by the end of 2015, but OMB has not measured agencies' progress against its other goal of $3 billion in cost savings by the end of 2015. Agencies closed 420 data centers by the end of December 2012, and have plans to close an additional 548 to reach 968 by December 2015--285 closures short of OMB's goal. OMB has not determined agencies' progress against its cost savings goal because, according to OMB staff, the agency has not determined a consistent and repeatable method for tracking cost savings. This lack of information makes it uncertain whether the $3 billion in savings is achievable by the end of 2015. Until OMB begins tracking and reporting on performance measures such as cost savings, it will be limited in its ability to oversee agencies' progress against key initiative goals. Additionally, extending the horizon for realizing planned cost savings could provide OMB and data center consolidation stakeholders with input and information on the benefits of consolidation beyond OMB's initial goal.

Pursuant to OMB direction, three organizations--the Data Center Consolidation Task Force, the General Services Administration (GSA) Program Management Office, and OMB--are responsible for federal data center consolidation oversight activities; while most activities are being performed, several weaknesses exist. Specifically,

  • While the Data Center Consolidation Task Force has established several initiatives to assist agencies in their consolidation efforts, such as holding monthly meetings to facilitate communication among agencies, it has not adequately overseen its peer review process for improving the quality of agencies' consolidation plans. For example, the Task Force did not provide agencies with guidance for conducting peer reviews and did not provide oversight to ensure that all agencies exchanged plans.
  • The GSA Program Management Office has collected agencies' quarterly data center closure updates and made the information publically available on an electronic dashboard for tracking consolidation progress, but it has not fully performed other oversight activities, such as conducting analyses of agencies' inventories and plans.
  • OMB has implemented several initiatives to track agencies' consolidation progress, such as establishing requirements for agencies to update their plans and inventories yearly and to report quarterly on their consolidation progress. However, the agency has not approved the plans on the basis of their completeness or reported on progress against its goal of $3 billion in cost savings.

The weaknesses in oversight of the data center consolidation initiative are due, in part, to OMB not ensuring that assigned responsibilities are being executed. Improved oversight could better position OMB to assess progress against its cost savings goal and minimize agencies’ risk of not realizing anticipated cost savings.

Why GAO Did This Study

In 2010, as focal point for information technology management across the government, OMB’s Federal Chief Information Officer launched the Federal Data Center Consolidation Initiative—an effort to consolidate the growing number of federal data centers. In July 2011 and July 2012, GAO evaluated 24 agencies’ progress and reported that nearly all of the agencies had not completed a data center inventory or consolidation plan and recommended that they do so.

As requested, GAO reviewed federal agencies’ continuing efforts to consolidate their data centers. This report (1) evaluates agencies' reported progress against OMB’s planned consolidation and cost savings goals and (2) assesses the extent to which the oversight organizations put in place by OMB for the Federal Data Center Consolidation Initiative are adequately performing oversight of agencies' efforts to meet these goals. GAO assessed agencies’ progress against OMB’s goals, analyzed the execution of oversight roles and responsibilities, and interviewed OMB, GSA, and Data Center Consolidation Task Force officials about their efforts to oversee agencies’ consolidation efforts.

What GAO Recommends

GAO is recommending that OMB’s Federal Chief Information Officer track and report on key performance measures, extend the time frame for achieving planned cost savings, and improve the execution of important oversight responsibilities. OMB agreed with two of GAO’s recommendations and plans to evaluate the remaining recommendation related to extending the time frame.
For more information, contact David A. Powner at (202) 512-9286 or pownerd@gao.gov.

Status Legend:

More Info
  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Recommendations for Executive Action

    Recommendation: To better ensure that Federal Data Center Consolidation Initiative (FDCCI) achieves expected cost savings and to improve executive-level oversight of the initiative, the Director of OMB should direct the Federal Chief Information Officer (CIO) to track and annually report on key data center consolidation performance measures, such as the size of data centers being closed and cost savings to date.

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

    Status: Open

    Comments: According to an Office of Management and Budget (OMB) March 2013 memorandum, the Data Center Consolidation Task Force is responsible for developing performance measures for data center energy, facilities, labor, and storage, among other things. However, as of July 2013, the specific metrics for agencies to report against had not yet been finalized, nor had OMB tracked and reported on agencies' progress against these metrics. Further, regarding cost savings to date, OMB's May 2013 quarterly report to Congress on the status of federal information technology reform efforts noted that three agencies--the Department of Agriculture, Department of Homeland Security, and the National Science Foundation--reported cost savings, collectively totaling $65.3 million, from their data center consolidation efforts. However, continued tracking and reporting of cost savings will be needed to help ensure continued progress against OMB's original goal of $3 billion in savings by the end of 2015. We will continue to evaluate OMB's progress in implementing this recommendation.

    Recommendation: To better ensure that FDCCI achieves expected cost savings and to improve executive-level oversight of the initiative, the Director of OMB should direct the Federal CIO to extend the time frame for achieving cost savings related to data center consolidation beyond the current 2015 horizon, to allow time to meet the initiative's planned cost savings goal.

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

    Status: Open

    Comments: The Office of Management and Budget stated that it will reevaluate the time frame for the Federal Data Center Consolidation Initiative's cost savings goal as the initiative proceeds and generates cost savings. We will continue to evaluate OMB's progress in implementing this recommendation.

    Recommendation: To better ensure that FDCCI achieves expected cost savings and to improve executive-level oversight of the initiative, the Director of OMB should direct the Federal CIO to establish a mechanism to ensure that the established responsibilities of designated data center consolidation oversight organizations are fully executed, including responsibility for the documentation and oversight of the peer review process, the review of agencies' updated consolidation inventories and plans, and approval of updated consolidation plans.

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

    Status: Open

    Comments: In March 2013, the Office of Management and Budget (OMB) issued a memorandum that made significant changes to the Federal Data Center Consolidation Initiative, including the responsibilities of the three designated data center consolidation oversight organizations--the Data Center Consolidation Task Force, the General Services Administration's Program Management Office, and OMB. Specifically, while OMB's March 2013 memorandum documented several new oversight responsibilities of these organizations, such as Task Force's responsibility for developing data center performance metrics, it did not address several other important oversight responsibilities, such as the review and approval of agency-required data center consolidation information going forward. In addition, OMB's memorandum did not discuss a mechanism for ensuring that key responsibilities of the designated data center consolidation oversight organizations are fully executed. We will continue to evaluate OMB's progress in implementing this recommendation.

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