Three Important Questions When Planning for IT Acquisitions

The government spends approximately $80 billion on Information Technology (IT) acquisitions. That equates to a lot of contract actions affecting the criticality of IT systems affecting our national health, security, and economy.

The likelihood that you will encounter procurements that have IT considerations at some point in your contracting career is high. So, how do you plan for these types of IT acquisitions, and how do you make decisions about your IT spending?

To effectively plan, you must first understand what IT acquisitions encompasses. The Federal Acquisition Regulation (FAR) 2.101 defines information technology as:

“[A]ny equipment, or interconnected system(s) or subsystem(s) of equipment, that is used in an automatic acquisition, storage, analysis, evaluation, manipulation, management, movement, control, display, switching, interchange, transmission, or reception of data or information by the agency.”

The generally accepted definition of information technology includes computers; ancillary equipment (including imaging peripherals, input, output, and storage devices necessary for security and surveillance); peripheral equipment designed to be controlled by the central processing unit of a computer; software, firmware, and similar procedures; services (including support services); and related resources.

Planning for Success

Before undertaking an IT acquisition, there must be a perception of need. This perception may originate at various levels in an agency or department.

The next step in planning to acquire IT should be to answer the Clinger-Cohen Act’s three pesky but necessary questions.

These questions are found in OMB’s Capital Programming Guide and incorporate Raines’ Rules, and they’re critical because major information systems will not be funded unless agencies can demonstrate the actions they have taken to address them.

The answers can help identify alternatives to investment in capital assets. In addition, they can help avoid making IT investments in support of inefficient agency functions or functions that should not be performed by the agency.

Here are the three questions you need to answer in order to effectively plan for IT acquisitions:

1. Does the investment in a major capital asset support core/priority mission functions that need to be performed by the Federal government?

The first question focuses on the issue of whether the function to be supported by the potential acquisition needs to be done at all. Given limited resources, an agency’s emphasis needs to be on supporting functions that are central to the achievement of the agency’s mission.

Answering “yes” to this question verifies the mission-essential need.

2. Must the requesting agency undertake the investment because no alternative private sector or government source can better support the function?

If the function is central to the agency’s mission, the second question addresses whether the agency can accomplish the function better than the private sector or another government entity. Alternatives include spinning off the function to another agency, devolving it to state or local governments, or privatizing the function.

This step — looking outside the agency that has the need to determine the best means to meet that need — is often overlooked.

However, Congress has indicated an intent to use reporting under the Government Performance and Results Act (GPRA) to identify where functions should be combined across agencies. It is, therefore, important to consider such matters before being questioned about them.

3. Does the investment support work processes that have been simplified or otherwise redesigned to reduce costs, improve effectiveness, and make maximum use of commercial off-the-shelf technology?

This question requires that consideration be given to re-engineering the functions and processes to be supported by the IT to reduce costs and improve effectiveness. Some performance gaps may be resolved by reworking processes with or without IT investments.

Management should re-engineer business processes first, then search for acquisition alternatives. It is possible that re-engineering could eliminate the immediate need for IT resources.

Are you prepared?

Given the significant IT spending each fiscal year, there is constant pressure to get it right. Keeping up with the growing field of IT can be overwhelming. Let alone the numerous government policies, laws, and regulations that affect IT, such as the Federal Information Security Management Act of 2014 (FISMA), Digital Accountability and Transparency Act of 2014 (DATA Act), and the Federal Information Technology Acquisition Reform Act of 2014 (FITARA).

Management Concepts can help you use the above questions to frame your IT acquisition planning to achieve successful contract outcomes—check out our upcoming scheduled classes!