Treasury Department knocked for IT spending says report

The U.S. Treasury Department is not managing its technology dollars as well as it could be, according to a recent report from the Government Accountability Office.

The Treasury Department’s management of its US$2.8 billion annual IT budget suffers from “significant weaknesses,” the GAO contended in the 64-page report.

In particular, the GAO cited a need for Treasury officials to improve the coordination between the agency’s IT and business managers on proposed technology investments.

In reaching that conclusion, the GAO looked at the Treasury Department’s IT spending process through the lens of the Information Technology Investment Management (ITIM) framework, a five-stage “maturity model” that the GAO developed for use by federal agencies.

ITIM users progress through the five stages, similar to earning different-coloured belts in a martial art. According to the GAO’s description of the framework, a stage 5 organization “conducts proactive monitoring for breakthrough information technologies that will enable it to change and improve its business performance.”

The Treasury Department is somewhere between stage 2 and 3 of ITIM, having completed some of the process requirements detailed in both stages, the GAO said in its report on the agency. For instance, the GAO said the Treasury Department recently implemented a process designed to help it identify IT projects that should get additional oversight by agency officials.

But one thing in particular that the department still needs is an “investment review board” that could serve as the final decision-making authority on proposed IT projects, the GAO said. It suggested that the board be made up of executives from the IT department and the agency’s operating units.

The GAO also raised other issues, including a lack of documented policies for managing “nonmajor” IT investments and the agency’s failure thus far to develop a comprehensive plan for improving its oversight of IT spending.

“Until the department addresses these weaknesses, it will not have the investment management structure needed to effectively assess and manage the risks associated with its multibillion-dollar [IT] portfolio,” the GAO wrote.

David Powner, the GAO’s director of IT management issues, said in an interview that he isn’t aware of any federal agencies that have reached stage 5 of the ITIM model. Nor have any of the agencies that do self-assessments of their progress on ITIM claimed to have reached the framework’s pinnacle, according to Powner.

But if an organization reaches stage 3, “they are fairly mature at that point,” he said.

Achieving that level means an agency is bouncing IT investment decisions across organizational boundaries – similar, Powner said, to companies in the private sector that let executives from all of their operating units consider the business-case justifications for proposed projects.

Related content:

Big IT projects fumbled by feds, says Auditor General’s report

Take a business-centric view of IT projects, task force urges Ontario government

Federal budget promotes IT – but ‘not in a big way’

Re-asserting budgets and the business value of IT

What is up with IT spending in 2007?

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