Report highlights 'massive waste' in federal IT spending

The IAITAM report cautions that until the federal government adopts a rigorous approach to IT Asset Management (ITAM), it is unlikely to stem IT-related failures seen recently at the Internal Revenue Service, the White House, State Department, and the Veteran’s Administration.

Available online at http://bit.ly/iaitamnews, the report titled “Understanding the Federal Government’s ‘IT Insecurity’ Crisis” notes that by focusing largely on hacks and other breaches, elected officials and agency administrators are failing to take a bottom-up approach to the purchase, control, inventory, and proper destruction of such IT assets as software, computer hard drives and mobile devices. The federal government spends about $70 billion a year on IT purchases and an average of about $10 billion a year on IT security. With no meaningful standards and controls in place across and even within federal agencies, the result is massive waste, inefficiency, and huge vulnerabilities that can easily be exploited from those inside and outside of the system.

As the IAITAM report notes, two recent analyses concluded that private industry in the United States spends an average of $4,600-$4,900 per employee on IT – less than $5,000 a head. By contrast, the federal government spends over $36,000 per employee on IT. As the report notes: “This suggests that the federal government spends an astonishing six times more per employee on IT than does private industry. As if these overall figures were not eye popping enough, the variations by federal agency are even more extreme, including more than $168,000 per U.S. Department of Education employee and more than $109,000 per U.S. State Department employee! It is not comforting to see that the most reasonable (in relative terms) level of spending is at the technology-challenged Veteran’s Administration at nearly $11,700 per employee, a level still well over twice what private industry pays in the U.S.”

Report author and IAITAM CEO Dr. Barbara Rembiesa: “Taxpayers need to understand that simply throwing more dollars at Information Technology (IT) and IT security is not a solution for anything other than mind-boggling waste of public funds. While awareness of the federal IT security problem has grown in recent months, the ability to deal with such threats has improved very little. Right now, we have the high-tech equivalent of the $436 Pentagon hammer and it’s just getting worse. Federal IT chiefs often cite inadequate funding as the biggest inhibitor to progress, but a thorough investigation of the overall federal government IT sector reveals that cost savings and IT security would be increased by a comprehensive ITAM program at the national government level in the U.S. Just as importantly, more tightly controlled spending would actually reduce the IT failures now plaguing federal agencies.”

As the IAITAM report notes: “It is important to understand that in addition to breaches, there is a huge potential for cutting wasteful spending through IT Asset Management that would save taxpayers substantial sums of money. It has been estimated that the Department of Homeland Security alone saved $181 million in software licensing in one recent year, and that more than $1 billion could be saved in information technology and telecommunications per year across the federal government if best practices were applied.”

The IAITAM report concludes: “At the root of much of what ails the federal government bloat in Information Technology (IT) spending and related woes is a lack of meaning IT Asset Management. ITAM is the bridge that links an organization’s financial, contractual, and physical IT inventory requirements with the goals and objectives of the operational IT environment."