Federal CIOs must become portfolio managers–here’s how

In August 2012, the White House’s Office of Management and Budget stated in a memo that federal CIOs should become true portfolio managers. The memo was aimed at heads of executive departments and agencies and was released as part of the U.S. federal IT reform plan. As with most OMB memos, it contained a lot of common sense, but many of the memo’s recommendations are easier said than done.

What the CIO should own

Let’s look at what the OMB said. They identified four key areas over which agency CIOs should have ownership:

  1. Governance: CIOs must become true portfolio managers. They need to understand their IT portfolio and manage it.
  2. Commodity IT: CIOs must focus on eliminating duplication and rationalize their agency’s IT investments.
  3. Program Management: CIOs should have oversight over program managers.
  4. Information Security: CIOs should have ownership over security.

Today, however, most agency CIOs are nowhere near this level of ownership. In a recent assessment, the General Accountability Office (GAO) concluded that federal agencies still have a long way to go, “specifically that CIOs face significant limitations in their ability to influence IT investment decision making at their agencies and to exercise their statutory authority.”

Getting to true portfolio management

I’ve worked inside federal agencies, specifically providing advisory and portfolio management solutions within the Office of the CIO for the Department of Homeland Security, Education, USAID, and Energy as well as within the executive branch of the House of Representatives technology office. I know firsthand how difficult it can be to gain control of IT. Today, as CTO of HP’s Federal Professional Service Organization, I consult with U.S. federal agencies and provide CIO advisory services, helping them to tackle these very problems. To become a true portfolio manager, you need authority over which IT investments go forward and which get killed.

Here are some baby steps you can take to get there:

  • Identify necessary policy changes – and part of that is deciding whether these changes are even feasible within your agency. Policy changes will drive all organizational, developmental and other activities required.
  • Map out what your new role and responsibilities would actually look like. Factors to look at include stakeholder alignment; IT strategy and governance committees; and the role in budget formulation, execution, service operations, security and so on.
  • Identify what oversight of program managers means. Do you have input into their performance reviews? Will program managers and/or the CFO require your approval for budgets?
  • Identify quick wins that provide ROI within the current budget execution year. Work with OMB to allow cost savings to be leveraged for baseline and reprogramming efforts.
  • Create a roadmap to implement new solution offerings and services so you can be more proactive vs. reactive to strategic change while balancing near-term and long-term goals and objectives
  • Start tracking the performance and cost of your IT programs in metrics and outcomes that the business can understand. A value measurement framework, developed specifically to align with Agency and Government-wide strategic plans, is essential for this task.
  • Implement project and portfolio management and application rationalization solutions that help tell your story with quantifiable metrics, not qualitative assessments, and sustain the ability to periodically track the execution of IT strategy to assure success.

As the federal IT Reform movement continues, more CIOs will go through this process. Some of these steps may be painful and difficult. But only when federal CIOs are true portfolio managers, and can communicate to their stakeholders how IT drives business outcome, will they be able make the changes necessary to truly transform federal IT.

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