• Closing the IT Gap: An Update

    As part of the President’s Accountable Government Initiative, OMB along with our colleagues throughout the federal government has been launching a series of initiatives to close the “technology gap” between the private and public sectors to cut waste and boost performance.  As part of that effort, my team was directed to develop a comprehensive strategy to reform how IT projects are built and procured.

    On November 19, I’ll be presenting this strategy at a talk to the Northern Virginia Technology Council, in the heart of the capital region’s “Silicon Valley.” I’ll offer recommendations on reforming federal IT, ranging from project management to procurement to budgeting and personnel reforms – and I hope to discuss with the private sector there and in other venues how best we can transform federal IT.

    We’re particularly excited about our IT reform efforts because, first, it represents $79 billion a year that can be better spent; and, second, these dollars are invested in technologies that can generate further cost-savings and better, more convenient services for the American public.

    To that end, we have been moving forward over the past few months on the other parts of our IT reform agenda, including:

    • Reforming and cutting costly IT systems. The Federal Chief Information Officer Vivek Kundra is undertaking detailed reviews of the highest priority IT projects across the federal government. After reviewing dozens of projects, IT project budgets have been reduced dramatically, including cancellation of the Justice Department's Litigation Case Management System and the significant restructuring of the Interior Department's Incident Management Analysis and Reporting System.

    • Bringing Transparency to IT Spending. To provide the American people with unfiltered access to federal technology spending information, the Administration launched the IT Dashboard – a graphically-rich, user-friendly website that enables anyone to track spending on and progress of IT projects across the federal government.

    • Increasing Oversight of Financial System Modernization Projects. We directed all executive departments and agencies to stop issuing new task orders or procurements for all financial system modernization projects – an area of persistent problems – pending review and approval by OMB of new, more streamlined project plans.

    • Moving to consolidate data centers and deploy cloud computing technology to reduce IT, real estate, and energy costs. Already, we have implemented a zero-growth policy on federal data centers, we are working with agencies to review their plans, and we are on track to meet the president's objective to consolidate and significantly reduce the number of data centers within five years.

  • Keeping a Close Eye on Recovery Act Dollars

    From the beginning, the President and Vice President have demanded an unprecedented level of accountability and transparency from recipients of Recovery Act funds.  Tens of thousands of recipients are required to report in every quarter on how exactly they are putting their Recovery Act contract, grant or loan to work -- and those reports are posted in full public view on  You can see them for yourself HERE.  This is a pioneering transparency effort and, while there may have been some initial skepticism that it could be pulled off, last quarter nearly 100 percent of recipients required to report did so.  This unprecedented level of disclosure has been lauded by government watchdogs and transparency groups as a significant achievement for open government.

    Now, it would be easy to rest on this accomplishment of near 100 percent participation, but frankly, we’re not satisfied -- we believe that everyone that is required to share with the public how they are putting Recovery dollars to work should be doing so.  That’s why Federal agencies have been charged with aggressively pursuing the .5 percent of cases where recipients have failed to file. 

    But each case is a little bit different --  and that’s why agencies have been empowered to pursue them with action ranging from an initial warning letter to withholding or rescinding of funds and even litigation, if it becomes necessary.  Here is how it breaks down:

    • Of the 74,244 prime recipients required to file last quarter, just 352 failed to file a report last quarter -- that’s 99.5 percent participation. 

    • Of the 352 who failed to file, 89 percent of them -- or 312 -- were first-time non-reporters.  Often one-time non-filers have technical problems reporting, so the relevant agency contacts them with a warning letter that also offers the necessary technical or other assistance.  Other cases of first-time non-reporting have been as simple as internal company or organization miscommunication or personnel changes.  In the vast majority of these cases, the recipient simply resolves their internal technical or staffing issue and files the next quarter.

    • Of the remaining 40 non-reporters, 32 failed to comply twice, 4 failed to comply three times, and 4 failed to comply four times.  Each of these cases is aggressively pursued by the relevant agency with punitive action ranging from withholding or rescinding funds to litigation, if necessary.  You can take a look at the action being taken in each of these 40 cases HERE . We take these cases seriously, but overall, they represent .1 percent of Recovery Act recipients and involve less than .001 percent of total Recovery Act funding.

    Changing the way business is done in Washington doesn’t happen overnight -- we are constantly working to improve transparency processes and help recipients of Recovery Act funds adjust to meet our high standards.  But we agree with government watchdogs that the unprecedented level of transparency provided with the Recovery Act over the last year-and-a-half has been a meaningful step in the right direction.

  • Seeing Eye to Eye with the Tech CEO Council

    Today, the Technology CEO Council released a report outlining a plan to “maximize productivity…and enhance government services” through the use of technology. This distinguished group of corporate leaders -- from companies such as IBM, Dell, and Motorola -- believe that by utilizing some of the best practices of the private sector, the government can realize significant savings and improve the service delivered to you, the taxpayers.

    We couldn’t agree more -- and that’s why for the past 20 months, as part of the President’s Accountable Government Initiative, the team at OMB along with our colleagues throughout the federal government has been launching a series of initiatives to close the “technology gap” between the private and public sectors to cut waste and boost performance. In fact, this list of initiatives closely mirrors those outlined by these tech industry leaders.

    For instance, we are moving aggressively to reform how information technology is used and procured. A review of financial systems modernization efforts already has led to cancellations and reforms that will save $750 million, and our team is also reviewing 30 high-priority IT projects across the government to find further savings and areas for improvement. We are moving to consolidate data centers, and use cloud computing to reduce IT, real estate, and energy costs. And I am leading an effort to fundamentally reform how IT projects are procured and managed so that best practices are identified, shared, and built in from the get-go.

    Similarly, we are achieving savings by changing how the federal government purchases goods and services. We have reversed the trend of significant growth in high-risk contracts -- such as "no-bid" contracts -- and the percentage of dollars awarded in new contracts without competition has dropped by 10 percent. We are on a path to realize the President’s goal of saving $40 billion in contracting savings by the end of FY 2011. In addition, we are working to centralize some purchasing so that the federal government gets the best deal for taxpayers. For instance, by consolidating the purchase of office supplies, we will save 20 percent or $200 million over four years.

    Finally, when it comes to the roughly $110 billion in improper payments sent out by the federal government each year, the President has set an ambitious goal of reducing them by $50 billion between now and 2012. To meet this challenge, the Administration has embarked on a range of strategies from creating a government-wide Do Not Pay List to expanding the use of payment recapture audits, audits in which there is a financial incentive for recovering misused funds.

    These are just three examples of where we have moved the ball on cutting waste and modernizing government. Whether it’s reforming and cutting costly IT systems, implementing unprecedented transparency and reporting efforts, pursuing $40 billion in contracting savings, buying in bulk, establishing a government-wide Do Not Pay list, or moving toward electronic government payments, we’re making real progress in changing the way government does business.

    In its report, the Technology CEO Council writes that the key to creating a government that is more efficient and more effective is "leadership -- and it must come from all sectors of society." We couldn’t agree more, and look forward to working with this group and people from across the country to create a government that is more effective and efficient, more open and accountable.

  • Cutting Costs in Financial Systems

    As I’ve blogged about previously, the President is committed to changing how Washington does business. That’s why we launched the Accountable Government Initiative - to eliminate what doesn’t work, crack down on waste, and make government more open and responsive to the American people. Closing the technology gap that exists between the public and private sectors will be critical to achieving these goals.  Over the past 10 to 15 years, the government has significantly lagged behind the private sector in using information technology to cut costs and deliver better services. And when federal information technology projects are undertaken, they too often cost more than they should, take longer than necessary to deploy, and fail to deliver solutions that meet our business needs.
    To address these problems, we recently launched a set of IT reform efforts as part of the Accountable Government Initiative. We focused on three key areas:  the federal government’s overall IT procurement and management practices, high-priority IT projects in need of additional attention, and financial system modernization projects – an area of persistent problems. In this final category, financial system modernization projects, we immediately froze all activity pending review and approval of more streamlined plans.
    Today, we are seeing the fruits of that review.
    Three agencies – the Environmental Protection Agency, the Department of Housing and Urban Development, and the Small Business Administration – just completed a review of their systems and are moving forward with plans to reset the scope of and improve their financial system projects, resulting in reduced costs and a greater focus on critical business needs.  Together with a recent decision from the Department of Veterans Affairs to cancel their own large-scale financial systems project in favor of more urgent agency priorities, the budgets for these projects have been reduced by a combined $750 million. 
    Moreover, we are harnessing the power of IT to drive productivity gains and improve customer service across government agencies. 
    These results are just the beginning.  Agencies are taking the lessons learned from the financial systems reform effort and applying them across their portfolio of IT projects, and we are using the best practices to inform our work on fundamental reform of IT procurement and management practices across all agencies.
    These reforms are a great example of our Administration-wide efforts to take a hard look at what’s working and what isn’t – and make tough decisions about how to get the most out of taxpayer dollars. Changing the way government does business isn’t easy, but we’re excited about the improvements that these choices will yield, resulting in better services and lower costs for the American people.  I look forward to sharing continued progress with you in the weeks ahead.

  • Sending Out to SES

    The country faces extraordinary challenges – from growing our economy to transforming our energy supply, improving our children’s education, safeguarding our Nation, and restoring its fiscal health. There is a distinct role for government in addressing these challenges, but it will only be possible with a government that runs effectively and efficiently.   That’s the central goal of our Accountable Government Initiative – to cut waste and make government work better and faster. 

    As the Administration’s Chief Performance Officer, I’m pleased to report that we’re making good progress in these efforts.  Today, I sent a memo out to the more than 7,000 members of the Senior Executive Service (SES), to update them on the progress we are making and to make clear the President’s commitment to and strategy for modernizing and reforming government.  The SES leads and manages operations across all Federal agencies, and they serve as the link between senior  political appointees and the rest of the Federal work force.  Effective performance improvement efforts are driven by senior leaders, and the SES is critical to our efforts.  We need these senior managers to continue to work with frontline workers to drive our performance improvement initiatives, and also to use their leadership positions to spread the belief and expectation that we are going to make government work more efficiently and effectively for the American people.

    As I detail in the memo, our performance management efforts are focused on six strategies that have the highest potential for achieving meaningful performance improvement within and across Federal agencies: driving agency top priorities; cutting waste; reforming contracting; closing the IT gap; promoting accountability and innovation through open government; and attracting and motivating top talent. We have already made significant progress in these areas. Whether it’s reforming and cutting costly IT systems, implementing unprecedented transparency and reporting efforts, pursuing $40 billion in contracting savings, buying in bulk, establishing a government-wide Do Not Pay list, or moving toward electronic government payments, we’re making real progress in changing the way government does business.

    Today’s memo is about maintaining this momentum, and strengthening communications and accountability with key government employees to achieve lasting, step-function improvements in government efficiency and effectiveness. It may sound like bureaucratic jargon, but the effects of these changes matter to the American people. As the President said in his letter to SES employees today, “This is not just about lines on a spreadsheet or numbers in a budget. When government does not work like it should, it has a real effect on people’s lives – on small business owners who need loans, on young people who want to go to college, on the men and women in our armed forces who need the best resources when in uniform and deserve the benefits they have earned after they have left.”

    Read today’s memo to SES members on the performance management agenda here.

  • FDA on Track

    Accountable, effective government took another significant step forward recently. The Food and Drug Administration (FDA) cut the ribbon on its FDA-TRACK management system, advancing the President’s Accountable Government Initiative and Open Government Initiative.  The acronym that FDA chose to name its management approach, TRACK, nicely conveys of the pillars of the Obama Administration’s approach to modernizing government. TRACK stands for Transparency, Results, Accountability, Credibility, and Knowledge-Sharing. 

    With the full scale launch of FDA-TRACK, the Food and Drug Administration is moving down the path we want all Federal agencies to follow. Agency senior leaders, in this case FDA Commissioner Hamburg and Deputy Commissioner Sharfstein, are driving performance gains on  agency priorities and expecting agency managers, FDA Center Directors and others, to do the same – not just for agency priorities, but also for each Center’s and program’s priorities.  FDA has already launched a pilot of FDA-TRACK and made progress on a number of fronts. It has, for example, increased the number of employees trained in the Incident Command System (ICS), improving the agency’s response to emergencies; developed a new risk-based approach for evaluating the safety, effectiveness, and quality of new animal drugs; and begun reducing vacancy rates on critical advisory councils. Deputy Commissioner Sharfstein runs regular data-driven reviews with each organizational unit and for key initiatives to keep FDA managers driving progress on priorities and reducing risks. These reviews are informed by data analysis that identifies problems and understands their causes, complemented by benchmarking comparisons and evaluations. And FDA is sharing FDA-TRACK information openly with the public on its website.

    FDA-TRACK builds on lessons of “Stat” and similar performance management systems that have been deployed by various governments to drive down crime rates, prison disruption, hospital wait times, overtime costs, and other problems and to drive up health, children’s well-being, and education outcomes. FDA-TRACK’s constructive, data-rich performance review epitomizes our commitment to learn from experience and use objective evidence to identify and build on what works, while fixing or tossing what does not. 

    FDA’s launch of FDA-TRACK is exciting, as is its commitment to open, accountable, performance-improving government. It is a great example of changes happening across the Administration that will improve the way government works, and government’s impact on outcomes, for years to come.

  • High-Priority IT Projects

    Today, as part of the Obama Administration’s Accountable Government Initiative, we released a list of 26 high-priority IT projects across the Federal government that have the potential for faster, smarter implementation. The programs we have identified, in coordination with the Agencies, are mission-critical and their objectives are as important as ever. By applying best-practices that are already delivering efficiencies in the private sector, we can make them work better and move faster. This effort is part of the coordinated, Administration-wide commitment to fundamentally change the way government does business and get more out of taxpayer dollars.

    You can view the recent memo on this initiative from CIO Vivek Kundra here.

  • Best Practices from the Best Companies

    The President has long believed that some of the best ideas come from outside Washington – especially when it comes to reforming Washington. That’s why he launched the SAVE Award, a chance for federal workers across the country to offer their best ideas about how to cut costs and improve performance, and it’s why he convened the White House Forum on Modernizing Government in January. There, we welcomed 50 CEO’s from many different sectors and sized businesses to hear their thoughts about how we can take the best practices of the private sector on increasing efficiency and effectiveness and apply them to the federal government.

    Since then, we have taken some of the best ideas and put them into practice.

    First, we’re making good progress in our efforts to improve the results of large-scale IT projects across the Federal Government. Consistent with the advice from many Forum participants, we’re intervening in high-risk projects while at the same time undertaking a structural review of our IT procurement and management practices. On the high-risk front, we are pulling together cross-functional leaders at the earliest signs of trouble to take corrective actions either to get projects back on track or terminate them as quickly as possible.

    And, inspired by the best practices Forum participants shared with us regarding project scope and duration, we are taking aggressive action on financial system modernization projects in particular, as these types of projects have been plagued by persistent problems. On June 28, we halted all financial system modernization projects across the Federal Government. Agencies now are working to meaningfully reduce the size, cost, and complexity of each project. Agencies are closely examining options to terminate, defer, or significantly reset the scope of their projects. These actions will reduce project costs by hundreds of millions of dollars and will increase the likelihood of success. For example, the Department of Veterans Affairs recently terminated a financial system project after determining it was unlikely to succeed, saving $300 million.

    In addition to large scale IT project management, our Forum discussions focused on customer service, and we’re making progress on this front as well. We have launched a multi-agency project to review customer service standards and the metrics used to track performance against those standards. We will make this information available to the public both to set customer expectations and to encourage effective performance management and oversight.

    We also are reviewing organizational obstacles that get in the way of the type of customer service best practices that surfaced during the Forum. For example, in most agencies, website and call center teams currently are run as separate operations with very little interaction, which is contrary to the practice of the best performing private sector organizations. We also are working to overcome the regulatory and logistical constraints on agency efforts to capture and act on customer satisfaction and feedback. We’ve already issued new guidance to enable agencies to use social media and web analytics to better connect with citizens and will have more to announce in the months ahead.

    Finally, we are working to keep the dialogue going between private and public sector managers. Not only are many Deputy Secretaries (agency COOs) in contact with their private sector counterparts, but this spring, the President issued an Executive Order creating the President’s Management Advisory Board to provide the President and the President's Management Council advice on the implementation of business best practices to improve Federal Government management and operations. We will be announcing Board members and holding our first meeting later this year, and we look forward to it serving as a lasting resource for bringing private sector expertise into government operations.

    Overall, while there are key differences between the government and the private sector, there is much we can learn from high-performing private sector organizations – and this Administration is committed to doing just that. 

  • Discovering What Works

    Good morning, OMBlog readers. Beginning today, I am serving as Acting Director until Jack Lew is confirmed as OMB Director – and I’ll be guest blogging here.

    As many of you know, I also serve as the Chief Performance Officer of the US Government, and what we know is that determining which programs work and which do not is critical to discovering whether government operations are doing what they are supposed to do in a cost-efficient manner.

    Yet too many important programs have never been formally evaluated. And when they have, the results of those evaluations have not been fully taken into the decision-making process, at the level of either budgetary decisions or management practices. For an organization as large as the Federal Government, with as many priorities and obligations as it has, the fact that we have rarely evaluated multiple approaches to the same problem makes it difficult to be confident that taxpayers’ dollars are being spent effectively and efficiently.  Running rigorous evaluations takes money, but investments in rigorous evaluations are a drop in the bucket relative to the dollars at risk of being poorly spent when we fail to learn what works and what doesn’t.

    That’s why as part of the President’s Accountable Government Initiative, OMB on Friday issued guidance to Federal agencies about conducting high-priority evaluations.  Agencies may request additional funding to conduct these evaluations and assess whether they are carrying out their mission as efficiently and effectively as possible. OMB is allocating a small amount of funding for agencies that voluntarily demonstrate how their FY 2012 funding priorities are subjected to rigorous evaluation, with an emphasis on evaluations aimed at determining the causal effects of programs or particular strategies, interventions, and activities within programs. In addition, we are working with agencies to improve and coordinate the use of existing evaluation resources.

    Finding out if a program works is common sense, and the basis upon which we can decide which programs should continue and which need to be fixed or terminated. This guidance will help us do just that.

  • Time is Running out to SAVE

    As many of you know, on July 8, President Obama launched the second annual SAVE Award contest, a chance for federal workers to submit their best ideas about how to cut waste and improve government performance. To date, the response has been impressive, with 11,000 ideas submitted in just over a week. A new feature of this year’s contest is that federal employees also have the opportunity to vote and comment upon their fellow workers’ ideas, and already more than 95,000 votes have been cast -- yet another sign of how federal workers are getting into the saving act.

  • ACUS is Back

    The President just appointed all 10 members of the Council of the Administrative Conference of the United States (ACUS) including OMB’s own Preeta Bansal, our General Counsel and Senior Policy Advisor, as Vice Chair of the Council, and Michael Fitzpatrick, our Associate Administrator at OIRA, as a member of the ACUS Council.

  • Thinking Long-Term

    Last week, the Congressional Budget Office released its long-term budget outlook. As I wrote at the time, the report confirms that the Affordable Care Act, if implemented effectively, can play an important role in moving toward a healthier fiscal future. Brad DeLong recently highlighted how large that role is by comparing last year’s report to this year’s, and I thought it was worth underscoring the point.

  • SAVE More

    In just three weeks, federal employees submitted more than 38,000 ideas identifying opportunities to save money and improve performance. After these were winnowed to a final four, the top idea was voted on by tens of thousands of Americans, and the winner – Nancy Fichtner from Loma, Colorado – came to the White House to present her proposal to save money in how the VA uses prescription medication. As we head into the FY 2012 budget season, the President today kicked off the second annual SAVE Award, asking workers on the frontlines to take a hard look again and to share their ideas and insight at

  • Cutting Waste and Saving Money Through Contracting Reform

    In March 2009, the President directed agencies to save $40 billion annually by Fiscal Year (FY) 2011 through contracting and to reduce the use of high-risk contracts. Last December, OMB reported on agency plans to save $19 billion in FY 2010, and agencies are on track to meet that savings goal as well as the larger one for 2011.

  • Four for the Fourth

    I’ve written a lot lately about how the information technology gap between the public and private sectors is driving a gap in productivity and how closing this gap is key to creating a government that is efficient and effective.

  • CBO’s Long-Term Budget Outlook

    The Congressional Budget Office today released its long-term budget outlook. Just like the long-term outlook in our own Budget, the CBO report concludes that we are on an unsustainable fiscal course. About this, there is no ambiguity.

  • Buying in Bulk

    For the past few weeks, I’ve blogged about common-sense steps we are taking across the federal government to cut waste and bring better services to the American people.

  • Cutting Waste by Reforming IT

    As I’ve written before, one source of ineffective and inefficient government is the technology gap between the public and private sectors.

  • Life is a Series of Hellos and Goodbyes

    Earlier this week, I announced that I will be stepping down as OMB Director. It has been a great honor to serve in President Obama’s Cabinet, and the decision to step down was not an easy one.


    As I wrote recently, one of the steps we are taking to cut waste in government and boost performance is establishing a Do Not Pay List, a single source through which all agencies can check the status of a potential contractor or individual, so that a barred or ineligible individual or organization is not paid erroneously. This is part of a sustained effort we have taken to go after the $100 billion wasted in improper payments each year by the federal government.