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US feds save billions through data center consolidation

But agencies fail to meet 'cut and reinvest' targets

America's biggest federal agencies carved out $3.6bn in IT cost savings between 2011-2014 - compared with government "cut and reinvest" guidance of $7.6bn and an annual IT budget of $80bn-plus.

Data centre consolidation and optimization efforts produced about half the IT procurement savings.

The OMB has set out three main planks for the agencies to produce IT procurement cost savings, namely:

  • Cloud computing first
  • Eliminate duplicated spending
  • IT shared services, where possible

And there is much more to do, according to a report released on 15 September, 2015 by the U.S. Government Accountability Office (GAO). Only five agencies had fully complied with the Office of Management and Budget's requirement to submit reinvestment plans and most agencies had failed to meet the OMB's 2014 cut and reinvest targets: $3bn in reductions and $2.1bn in reinvestments.

Furthermore, agencies were lax in measuring IT reinvestment performance - possibly because the OMB had not ordered them to track programs and define targets.

The GAO proposes that the agencies complete their savings program and boost reinvestment performance tracking, with compulsory enforcement. by the OMB. The OMB should also define targets.

Of the 26 agencies under the Office of Management and Budget's IT scrutiny, four - the Departments of Defense, Homeland Security, Treasury and the Social Security Administration - were particularly proactive, accounting for about $2.5bn (69 per cent) of recorded savings. ®

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