Dive Brief:

• The federal Commission on IT Cost, Opportunity, Strategy and Transparency (IT COST) released a report Friday offering federal CIOs 21 recommendations to help them better focus their IT modernization efforts.
• Combining insight from agency CIOs and private-sector experts, IT COST’s recommendations were designed to help federal CIOs "improve transparency, optimize IT spending and resource consumption, and accelerate critical initiatives such as public cloud adoption, shared services and data center consolidation," according to the report.
• The biggest overall recommendation suggests federal CIOs adopt a standard taxonomy, model and management system for IT costs, resources, and services "so that IT leaders, CFOs and other stakeholders use the same language and methodology to evaluate and improve cost for performance," according to the report.

Dive Insight:

The Commission urged federal CIOs and technology leaders to employ the recommendations and tools to "improve the value that taxpayers receive from federal IT spending."

In federal agencies mired in legacy technology, spending on operations and maintenance (O&M) far outpaces that of efforts to develop, modernize and enhance (DME) technology. In FY17, the federal budget for IT spending is $81.6 billion. Of that, $55.9 billion is earmarked for O&M, while just $18.7 billion is set aside for DME. 

These problems are not unique to just government agencies, as the private sector too struggled with modernization efforts. For some, modernizing IT systems stems from better transparency. 

The federal government spends almost 75% of its $80 billion federal IT budget on operations and maintenance of legacy systems, according to a May report from the Government Accountability Office. The watchdog report found 5,233 of the government's approximately 7,000 IT investments spent their entire budgets on operations and maintenance, without working to develop, modernize or enhance the systems.