[House Hearing, 112 Congress]
[From the U.S. Government Publishing Office]




 
 HOW MUCH IS TOO MUCH? EXAMINING DUPLICATIVE IT INVESTMENTS AT DOD AND 
                                  DOE

=======================================================================

                                HEARING

                               before the

                SUBCOMMITTEE ON TECHNOLOGY, INFORMATION
                POLICY, INTERGOVERNMENTAL RELATIONS AND
                           PROCUREMENT REFORM

                                 of the

                         COMMITTEE ON OVERSIGHT
                         AND GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                      ONE HUNDRED TWELFTH CONGRESS

                        HOUSE OF REPRESENTATIVES

                             SECOND SESSION

                               __________

                           FEBRUARY 17, 2012

                               __________

                           Serial No. 112-135

                               __________

Printed for the use of the Committee on Oversight and Government Reform


         Available via the World Wide Web: http://www.fdsys.gov
                      http://www.house.gov/reform


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              COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

                 DARRELL E. ISSA, California, Chairman
DAN BURTON, Indiana                  ELIJAH E. CUMMINGS, Maryland, 
JOHN L. MICA, Florida                    Ranking Minority Member
TODD RUSSELL PLATTS, Pennsylvania    EDOLPHUS TOWNS, New York
MICHAEL R. TURNER, Ohio              CAROLYN B. MALONEY, New York
PATRICK T. McHENRY, North Carolina   ELEANOR HOLMES NORTON, District of 
JIM JORDAN, Ohio                         Columbia
JASON CHAFFETZ, Utah                 DENNIS J. KUCINICH, Ohio
CONNIE MACK, Florida                 JOHN F. TIERNEY, Massachusetts
TIM WALBERG, Michigan                WM. LACY CLAY, Missouri
JAMES LANKFORD, Oklahoma             STEPHEN F. LYNCH, Massachusetts
JUSTIN AMASH, Michigan               JIM COOPER, Tennessee
ANN MARIE BUERKLE, New York          GERALD E. CONNOLLY, Virginia
PAUL A. GOSAR, Arizona               MIKE QUIGLEY, Illinois
RAUL R. LABRADOR, Idaho              DANNY K. DAVIS, Illinois
PATRICK MEEHAN, Pennsylvania         BRUCE L. BRALEY, Iowa
SCOTT DesJARLAIS, Tennessee          PETER WELCH, Vermont
JOE WALSH, Illinois                  JOHN A. YARMUTH, Kentucky
TREY GOWDY, South Carolina           CHRISTOPHER S. MURPHY, Connecticut
DENNIS A. ROSS, Florida              JACKIE SPEIER, California
FRANK C. GUINTA, New Hampshire
BLAKE FARENTHOLD, Texas
MIKE KELLY, Pennsylvania

                   Lawrence J. Brady, Staff Director
                John D. Cuaderes, Deputy Staff Director
                     Robert Borden, General Counsel
                       Linda A. Good, Chief Clerk
                 David Rapallo, Minority Staff Director

   Subcommittee on Technology, Information Policy, Intergovernmental 
                    Relations and Procurement Reform

                   JAMES LANKFORD, Oklahoma, Chairman
MIKE KELLY, Pennsylvania, Vice       GERALD E. CONNOLLY, Virginia, 
    Chairman                             Ranking Minority Member
JASON CHAFFETZ, Utah                 CHRISTOPHER S. MURPHY, Connecticut
TIM WALBERG, Michigan                STEPHEN F. LYNCH, Massachusetts
RAUL R. LABRADOR, Idaho              JACKIE SPEIER, California
PATRICK MEEHAN, Pennsylvania
BLAKE FARENTHOLD, Texas


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on February 17, 2012................................     1

                               WITNESSES

Mr. David A. Powner, Director, Information Technology Management 
  Issues, Government Accountability Office
        Oral statement...........................................     2
        Written statement........................................     5
Ms. Teresa M. Takai, Chief Information Officer, Department of 
  Defense
        Oral statement...........................................    22
        Written statement........................................    24
Mr. Michael W. Locatis, III., Chief Information Officer, 
  Department of Energy
        Oral statement...........................................    31
        Written statement........................................    33
Mr. Richard Spires, Chief Information Officer, Department of 
  Homeland Security
        Oral statement...........................................    39
        Written statement........................................    41

                                APPENDIX

The Honorable James Lankford, A Member of Congress from the State 
  of Oklahoma: Written statement.................................    68
The Honorable Gerald E. Connolly, A Member of Congress from the 
  State of Virginia: Written statement...........................    70
Questions for the record for Teri Takai..........................    71
Questions for the record for Richard Spires......................    75


 HOW MUCH IS TOO MUCH? EXAMINING DUPLICATIVE IT INVESTMENTS AT DOD AND 
                                  DOE

                              ----------                              


                       FRIDAY, FEBRUARY 17, 2012

                  House of Representatives,
   Subcommittee on Technology, Information Policy, 
Intergovernmental Relations and Procurement Reform,
              Committee on Oversight and Government Reform,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 9:30 a.m., in 
room 2154, Rayburn House Office Building, Hon. James Lankford 
(chairman of the subcommittee) presiding.
    Present: Representatives Lankford, Chaffetz, Walberg, 
Meehan, and Connolly.
    Staff present: Ali Ahmad, Communications Advisor; Richard 
A. Beutel, Senior Counsel; Molly Boyl, Parliamentarian; Gwen 
D'Luzansky, Assistant Clerk; Laura L. Rush, Deputy Chief Clerk; 
Richard Burkard, Detailee; Jaron Bourke, Minority Director of 
Administration; Jennifer Hoffman, Minority Press Secretary; 
Carla Hultberg, Minority Chief Clerk; Paul Kinkaid, Minority 
Press Secretary; Chris Knauer, Minority Senior Investigator; 
Adam Koshkin, Minority Staff Assistant; and Suzanne Owen, 
Minority Health Policy Advisor.
    Mr. Lankford. The hearing on ``How Much is Too Much? 
Examining the Duplicative IT Investments at DOD and DOE,'' and, 
honestly, to get a chance to look at what the process that we 
can do in IT investments governmentwide, will come to order.
    Oversight Committee existed--let me start all over.
    Good morning.
    We exist to secure two fundamental principles: First, 
Americans have the right to know the money Washington takes 
from them is well spent; second, Americans deserve an 
efficient, effective government that works for them. Our duty 
on the Oversight and Government Reform Committee is to protect 
these rights.
    Our solemn responsibility is to hold government accountable 
to taxpayers, because taxpayers do have the right to know what 
they get from their government. We will work tirelessly, in 
partnership with citizens watchdogs, to deliver the facts to 
the American people and bring genuine reform to the Federal 
bureaucracy.
    This is the mission of Oversight and Government Reform.
    I am going to allow my opening statement to go in for the 
record, instead of doing it orally.
    Mr. Lankford. And I have asked the ranking member to also 
do the same.
    Is that okay with you?
    Mr. Connolly. It is. And it is one of the first in 
Congress, I think, Mr. Chairman. Yes.
    Mr. Lankford. Well, you know what? We can slide that in.
    Mr. Connolly. So I can listen to them instead of ourselves.
    Mr. Lankford. That would be great for this, as far as the 
help on that.
    Mr. Lankford. So other Members will have 7 days to submit 
their opening statements. There may be some others that slip in 
on this and add extraneous material for the record itself.
    Mr. Lankford. I would like to welcome our panel.
    And let me tell you why we are rushing through the 
beginning of this. Votes have been called somewhere between 10 
to 10:15. It is our goal to try to get in the statements of our 
witnesses and do additional questions with them. If we can keep 
close on time, we can get a chance to honor time and not have 
to break for votes and then come back. We can try to conclude 
before we head for votes, which will honor every else's time. 
If we are not able to do that, we will have a nice 30- to 40-
minute break in the middle of our hearing, and then we will 
come back and conclude at the end.
    So I would like to welcome this first panel of witnesses.
    Mr. David Powner is the director of the Government 
Accountability Office's Information Technology Management 
Issues team. Ms. Teri Takai is the chief information officer at 
the Department of Defense. Mr. Michael Locatis is the chief 
information officer at the Department of Energy. Mr. Richard 
Spires is the chief information officer at the Department of 
Homeland Security.
    Thank you all for being here.
    Pursuant to committee rules, all witnesses are sworn in 
before they testify. If you would please stand and raise your 
right hands, please.
    Do you solemnly swear or affirm that the testimony you are 
about to give to this committee will be the truth, the whole 
truth, and nothing but the truth, so help you God?
    Thank you.
    Let the record reflect all the witnesses have answered in 
the affirmative.
    In order to allow time for discussion, I would ask you to 
limit your testimony to 5 minutes. Of course, your entire 
written statement will be made part of the permanent record, as 
well.
    With that, I would like to recognize Mr. Powner for his 
opening statement for 5 minutes.

                    STATEMENTS OF WITNESSES

                  STATEMENT OF DAVID A. POWNER

    Mr. Powner. Chairman Lankford, Ranking Member Connolly, it 
is a pleasure to be here this morning to discuss our latest 
report that highlights duplicative IT investments. The Federal 
Government spends nearly $80 billion on IT, and it is 
imperative that these investments enable the government to 
better serve the American people.
    The past several years have resulted in major improvements 
in transparency and focus on IT management. First, in June 
2009, the IT Dashboard has been providing cost and schedule 
information on nearly 800 IT investments and has provided a 
level of transparency and CIO accountability that is 
unparalleled.
    Today, over 250 investments, totaling nearly $18 billion, 
are at risk, meaning that agencies are rating these investments 
in either a yellow or red status. Focusing on these at-risk 
investments has made a difference. OMB claims that they have 
saved nearly $3 billion through its TechStat reviews that have 
resulted in poorly performing projects being halted or 
canceled. However, we still have too many investments at risk.
    In addition to the Dashboard, in December 2010 the IT 
Reform Plan was initiated that lays out an excellent roadmap to 
strengthen IT acquisition, governance, and program management. 
It also, if implemented successfully, will result in more cost-
effective IT operations by focusing on commodity IT, cloud-
based solutions, and data center consolidation. Over 200 data 
centers have already been closed, and the goal is to close a 
thousand by 2015. OMB estimates that data center consolidation 
will result in another $3 billion in savings.
    The Reform Plan emphasizes IT governance. Reforming and 
strengthening IT investment review boards and executive-level 
governance can greatly help turn around underperforming 
projects, as our many reviews for the Congress have 
highlighted.
    These governance processes can also identify and eliminate 
duplicative spending. This is important because last fall we 
issued a report that highlighted hundreds of investments 
providing similar functions across the Federal Government. The 
numbers here are staggering. For example, last year alone, the 
Federal Government invested in 781 supply chain systems, 
totaling $3.3 billion; 661 human resource systems, totaling 
$2.5 billion; and 580 financial management systems, totaling 
$2.7 billion. We recommended that Federal agencies ensure that 
their IT investments are not duplicative as part of their 
annual budget submissions.
    Mr. Chairman, at the committee's request, we followed up 
this review with a deeper look into IT investments at the 
Departments of Defense, Homeland Security, and Energy. 
Specifically, we looked at over 800 investments at these 3 
agencies associated with human resources, IT, and supply chain 
management. We found 37 investments in 12 categories that are 
potentially duplicative. For example, we found that the Air 
Force had five similar contract management systems, the Navy 
had four similar personnel assignment systems, and Energy had 
three similar back-end infrastructure investments.
    Addressing this duplication is important since DOD and 
Energy have spent $1.2 billion on these 37 investments over the 
past 5 years. Our report highlights the details of these 
investments and makes recommendations to eliminate duplicative 
spending and to further report on efforts to rout out 
duplication.
    The good news, Mr. Chairman, is that each agency has 
actions under way to tackle this duplication. DHS is furthest 
along, having already identified and eliminated duplicative 
investments through various portfolio reviews. For example, DHS 
consolidated six personnel-security-related systems into an 
enterprise system. At DOD, the Navy has implemented an 
executive oversight board, chaired by the Navy CIO, and all IT 
expenditures greater than $100,000 are reviewed and approved by 
the Navy CIO to ensure that they are not duplicative.
    DOE has various working groups addressing the records 
management and back-end infrastructure areas we pointed out 
and, on a broader scale, is holding TechStat sessions that are 
aimed at troubled investments and consolidating commodity IT 
services.
    Mr. Chairman, I would like to commend the leadership of the 
individuals on this panel. We expect further results from each 
agency in the near future as their efforts get more traction, 
but to be clear, we need more tangible results that eliminate 
duplicative spending.
    In summary, Mr. Chairman, it is safe to say that there is 
much more IT duplication out there. It is important that the 
agencies represented here and others use their investment 
governance processes to identify and address duplicative 
spending so that billions of taxpayers' dollars are not wasted.
    This concludes my statement. I look forward to your 
questions.
    Mr. Lankford. Thank you, Mr. Powner.
    [Prepared statement of Mr. Powner follows:]

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    Mr. Lankford. Ms. Takai?

                  STATEMENT OF TERESA M. TAKAI

    Ms. Takai. Good morning, Chairman Lankford and Ranking 
Member Connolly. Thank you so much for the opportunity to 
testify this morning on the findings of the GAO report that Mr. 
Powner just spoke of.
    The GAO report highlights 31 business-related DOD IT 
investments that cover a range of areas. And, as mentioned, it 
specifically examined contracts, personnel management, and 
logistics systems. The Department is taking action to address 
27 of the investments reviewed by GAO. The Department has 
looked at the remaining four systems, and we are prepared to 
discuss why those particular areas are actually not duplicative 
but more complementary. And we can go into more detail as you 
desire.
    The Defense Department's IT budget presents a unique 
challenge, not only in terms of its magnitude--it constitutes 
one-half of the Federal Government's overall IT expenditure--
but in scope and complexity, as well, as you know. The 
Department's fiscal year 1913 budget request of approximately 
$37 billion includes funding all the way from desktop 
computers, tactical radios, human resource systems, commercial 
satellite communications, financial management, and you name 
it. These investments support mission-critical operations both 
in our Pentagon and office environment and on the battlefield. 
Our IT environment is even more complex when one considers that 
we operate in 6,000 locations around the world.
    In this complex environment, the Department's business IT 
systems are essential enablers of a much broader set of 
integrated business operations. For example, paying our 
servicemembers on time is a responsibility shared among various 
members in our organization; it includes both human resources 
and financial professionals. So the business systems challenges 
for us really require a reform not only of our technologies but 
of our processes and our governance and our policies.
    In my written statement, I have described for you the well-
defined IT investment governance process that the Department 
uses. The Defense Business Systems Management Committee and our 
investment review boards, as well as our acquisition process, 
are major touch points for us to ensure that we are examining 
our IT investments. We use those processes to examine our new 
investments, but starting in fiscal year 1913 it will also 
include our existing IT capabilities and the dollars that we 
spend.
    These processes are important in helping the Department 
accelerate the transition away from our legacy environment into 
our target business systems environment, but there are other 
activities under way within the Department to further support 
this goal.
    But, first, I would like to provide you some specific 
examples of what the Department has done.
    The Army reduced the number of IT applications from 218 to 
77, a 65 percent reduction, during their BRAC move from Fort 
Monmouth, New Jersey, to the Aberdeen Proving Grounds. The Army 
Acquisition Domain has reduced the number of IT systems within 
that portfolio by 41 percent from 2006. The Logistics 
Modernization Program has sunset all 42 instances of the Army's 
Standard Depot System. Additionally, they have sunset all but 
one instance of the Commodity Command Standard System, a system 
comprised of 460 applications.
    The Navy has reduced by 50 percent the number of 
applications across 21 functional areas since 2003. And since 
2008, the Navy has eliminated over 400 legacy networks. The 
Marine Corps has reduced its applications by approximately 30 
percent just over the last year and a half.
    The Air Force has taken an aggressive action, as well, and 
has reduced its IT budget request by $100 million in 2012. Air 
Force Materiel Command headquarters has organized a Tiger Team 
committed to finding software application duplication and 
outdated systems that can be terminated with acceptable risk.
    These efforts, coupled with their ongoing work to reform 
acquisition of information capabilities and consolidating our 
infrastructure, are delivering better results for the business 
operations that our warfighters depend on.
    To continue our progress, an important part of moving 
forward is the infrastructure on which our business systems 
reside. We have developed an IT enterprise strategy and roadmap 
to optimize our DOD IT infrastructure. And we plan to continue 
reducing that infrastructure footprint, creating a joint 
enterprise, developing an enterprise identity management 
system, and reducing the number of data centers to drive our 
networks to enterprise solutions. With the roadmap, we are 
developing implementation plans to establish aggressive 
milestones to accomplish that goal.
    We are actively working with OMB on the data center 
consolidation. To date, we made significant progress in that 
regard. We are working with the military departments, DISA, and 
other components. In fiscal year 1911, DOD closed over 50 data 
centers, and we plan to eliminate more than 125 data centers in 
fiscal year 1912.
    Our focus on improving and designing an enterprise 
architecture and infrastructure will not only help DOD with 
migrating to enterprise solutions, but, more importantly, it 
will provide the Department with an improved ability to secure 
our information networks and our information and data. These 
efforts are key to transforming how we operate, how we acquire, 
and how we manage our IT investment in order to ensure 
efficiency, effectiveness, and security while still providing 
capability.
    I welcome the support of the subcommittee and really look 
forward to working with you and other Members of Congress as we 
strive to meet the challenges of streamlining and improving our 
overall IT capability. Thank you for your interest in our 
efforts, and I would be glad to answer any questions as they 
come up.
    Mr. Lankford. Thank you, as well.
    [Prepared statement of Ms. Takai follows:]

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    Mr. Lankford. Mr. Locatis?

              STATEMENT OF MICHAEL W. LOCATIS, III

    Mr. Locatis. Good morning, Chairman Lankford, Ranking 
Member Connolly, and other members of the subcommittee. Thank 
you for this opportunity to testify today on GAO's report on 
potentially duplicative IT investments.
    The Department of Energy appreciates the work being 
performed by the GAO to identify opportunities to improve 
mission effectiveness and fiscal efficiency. The DOE is 
dedicated to improving our overall IT portfolio management and 
to address areas identified in the GAO report. We are committed 
to ensuring DOE's IT investments make efficient use of taxpayer 
dollars at all times.
    As chief information officer for the DOE, one of my roles 
is to enable science, energy, and nuclear security missions 
through technology that provides tangible, positive outcomes. 
DOE is actively supporting and executing OMB's 25-point plan 
and other strategies championed by Vivek Kundra and now Steven 
VanRoekel. The Federal CIO community greatly appreciates their 
leadership and commitment to service. DOE is also supporting 
GSA by taking advantage of their sourcing and contract vehicles 
whenever we can and providing input to make them more usable 
wherever possible.
    Upon my arrival 16 months ago, I conducted a 45-day 
assessment and identified many opportunities to improve 
effectiveness and efficiencies of our IT. Many of these 
opportunities stemmed from fragmentation and duplication. As a 
result, I partnered with our program offices and moved forward 
to change the way we do business. DOE has implemented an 
Information Management Governance Council that solidifies 
accountability in our senior officials and has already 
delivered tangible outcomes that have enabled us to maximize 
the return of our IT investments and reduce duplication.
    In the areas of duplication, let me highlight three 
examples for you.
    First is our Joint Cybersecurity Coordination Center, or 
JC3. There is nothing more important than our national 
security, and DOE needed to connect its cybersecurity resources 
more efficiently across the complex. We established the JC3 to 
take a collaborative approach to cyber information-sharing and 
analysis and instant response across DOE enterprise and more 
effectively leverage the technical expertise of our national 
laboratories. This has made our cyber programs stronger and 
consolidated a number of duplicative functions.
    The second is our new virtual desktop infrastructure which 
consolidates applications deployed across thousands of desktop 
computers into a small number of servers that deliver 
productivity to virtually any end-user device, including thin 
clients, smart phones, and tablets. The virtual desktop 
infrastructure creates an environment that is energy-efficient, 
inherently more secure, and costs much less to maintain.
    The third is unified communications and desktop 
videoconferencing. We are consolidating into a low-cost, common 
desktop videoconferencing solution that better connects our 
employees. By enabling employees through instant messaging, Web 
conferencing, and desktop videoconferencing, we are targeting 
millions of dollars in travel savings and creating new 
efficiencies through enhanced collaboration and productivity, 
even where travel would not have been previously required.
    In conclusion, the GAO report has identified IT investment 
efficiency improvement opportunities for the DOE. I have just 
mentioned other areas in which we are aggressively breaking 
down silos and enabling the mission through technology across 
the Department.
    Thank you for this opportunity to discuss the report's 
findings. Mr. Chairman, this concludes my statement, and I look 
forward to answering your questions.
    Mr. Lankford. Thank you.
    [prepared statement of Mr. Locatis follows:]

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    Mr. Lankford. Mr. Spires?

                  STATEMENT OF RICHARD SPIRES

    Mr. Spires. Chairman Lankford, Ranking Member Connolly, 
thank you, and good morning. Today I will discuss efforts at 
the Department of Homeland Security to reduce duplicative IT 
investments.
    The key for an agency to eliminate system duplication is to 
develop an environment at the senior executive level that: one, 
enables a group of executives representing all appropriate 
organizations to work collaboratively to understand agency 
needs in a particular mission of business area; two, completes 
a comprehensive analysis in the mission or business area to 
identify ways to improve both effectiveness and efficiency 
across the enterprise; and, three, has a decisionmaking process 
in which those same executives can effectively drive change 
based on the analysis.
    I have found both in government and the private sector that 
if you can create these conditions, over time executives will 
be able to make the hard decisions on the tradeoffs and 
compromises necessary for the good of the enterprise. I use the 
term ``strategic alignment'' to reflect what is necessary for 
success. In my experience, the best way to achieve such 
alignment is through strong enterprise and portfolio governance 
buttressed by segment enterprise architecture.
    Enterprise governance provides large organizations with the 
ability to effectively make informed decisions that involve 
stakeholders across the enterprise. In smaller organizations, 
it is possible to execute enterprise governance with one 
governance body that represents top leadership. But in larger 
and more complex organizations, we need to break the challenge 
down into what we call portfolios, or logical partitions, that 
can support various elements of an organization's mission and 
business outcomes.
    Portfolios should typically represent functional groupings 
that can drive improvements to mission and business 
effectiveness. At DHS, we are working to implement 13 
functionally oriented portfolios, to include mission support 
functions such as include screening and incident response, 
along with business functions such as finance.
    So how does this work? Each portfolio has a governance 
board of appropriate senior executives that look over a 
multiyear planning horizon and define a set of measurable 
stretch objectives that would significantly improve mission or 
business effectiveness. To achieve those objectives, the 
portfolio governance board must establish capabilities that are 
required to meet such objectives.
    For instance, in a human resource portfolio, a capability 
may be to have an automated end-to-end tracking of all steps in 
a hiring process, with the objective to reduce the average time 
to hire by 50 percent. Once the objectives and capabilities are 
set, the board works with subject-matter experts to define the 
business process changes, IT system changes, elimination of 
redundant systems, and other appropriate program changes to 
achieve a goal end state. Once that goal end state is defined, 
the board sets a transition strategy that defines the step-by-
step process to go from the current or as-is state to the goal 
or desired state.
    The approach outlined above applies the generally accepted 
Federal Segment and applies Architecture methodology to a 
portfolio.
    At DHS, we are working to implement portfolios to drive and 
improve mission effectiveness while eliminating duplication. 
For instance, a comprehensive HR system inventory revealed 124 
systems, including many duplicative systems. We established an 
HR IT portfolio governance board and recently completed our 
Human Capital Segment Architecture, which will effectively 
shift a large number of these component-based systems and 
services to enterprise or Federal Government solutions.
    Likewise, we identified more than 20 separate common 
operating picture systems supporting the situational awareness 
needs of the Homeland Security mission. Leveraging a portfolio 
approach, this month our National Operations Center will stand 
up an upgraded version of the DHS common operating picture that 
incorporates all components requirements. The plan is then to 
roll out the new common operating picture to DHS operations 
centers across the enterprise over the next year, eliminating 
numerous duplicative common operating picture investments.
    It takes about 3 years of hard work for a portfolio 
governance approach to mature to the point where the portfolio 
has a solid set of business objectives and measures, a defined 
goal end state, and a viable enterprise transition strategy. 
Despite the difficulties, the benefit of this work can be 
tremendous.
    These methods can and should support implementation of the 
Shared First initiative aimed at routing out waste and 
duplication across the Federal IT portfolio.
    Thank you, and I look forward to taking your questions.
    [Prepared statement of Mr. Spires follows:]

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    Mr. Lankford. I thank all of our witnesses for testifying 
today.
    Let me recognize myself for 5 minutes, and let's have some 
conversation on this as well.
    I have a couple thoughts here. One is, Mr. Powner, you 
mentioned the Dashboard at this point. What I would like to 
know, for all of you that have integrated with that as well, 
has that been helpful, and what is missing from that? Is there 
a next level for that use in the Dashboard, and is it a helpful 
tool?
    So anyone can jump in and be able to respond to that.
    Ms. Takai. Well, let me start, and I am sure my colleagues 
have the same view.
    We have found the Dashboard process to be very, very 
helpful. It does really--I think it really, in many ways, takes 
the OMB desire for transparency and really gives us the 
opportunity to be able to put priority on that Dashboard 
process. So it does give the kind of transparency that we all 
need, but it also gives it at a higher level, which I think is 
helpful.
    In terms of going forward, I think our major challenge is 
to make sure that we are taking the best advantage of that 
Dashboard process internally, to make sure that we are driving 
the kind of process change that is needed.
    Mr. Lankford. Not every agency is engaged in that; is that 
correct, Mr. Powner?
    Mr. Powner. Yeah, I think--a couple things. I think the 
improved transparency is very important from an oversight 
perspective, whether you are at OMB, if you are an agency, or 
if you are in the Congress. The one thing that the Dashboard 
did is I think it greatly increased CIO accountability. What it 
says is, for all major investments--there are 800 of them 
across the major departments--is the CIO is ultimately 
accountable. So Ms. Takai has her pictures next to her 72 major 
investments. That actually was a good thing for some agencies 
where we needed more CIO accountability. It was very helpful 
moving forward.
    Mr. Lankford. The issue is, is the number right? Are there 
other projects that need to be there? Obviously, not every 
agency has not that large of an investment. Ms. Takai has very 
large, complicated, numerous projects on it. Should that work 
its way down to other agencies and say, okay, this is large for 
your agency, instead of setting a single standard for every 
agency?
    Mr. Powner. Well, there are 7,200 investments, so there are 
800 major and the rest are non-major. I think over time, as the 
Dashboard matures, it would be helpful to get insights into 
those non-majors. But, again, we probably ought to do that in a 
step-wise fashion to get the majors correct first.
    Mr. Lankford. Sure. But the question is, what is ``major'' 
to the Federal Government or what is ``major'' to your agency, 
if there a difference there. You can look at each agency and 
say, you know, I know you don't reach this level, but give us 
your five largest, most significant projects that are on there, 
whatever dollar amount that is, and those are your majors.
    Mr. Powner. No, that is an excellent point. It does differ. 
And, in fact, several non-majors at DOD would clearly be majors 
at other agencies.
    Mr. Lankford. Right.
    Ms. Takai, where you going to mention something as well?
    Ms. Takai. I would like to add to Mr. Powner's comments, 
that the visibility and transparency is important, not only for 
us as CIOs, but actually what we would view as more important 
is the visibility to the business process owners and the 
business process changes that really have to happen for any IT 
implementation to be successful.
    The success of these large-scale business systems are 
really more around, can we change the processes and can we 
actually make the business changes that we need, the 
necessarily just being dictated by the dynamics of the 
technology implementation. And the Dashboard really brings the 
opportunity for us to have the dialog at a much different level 
than if it were just delegated to being a technology 
discussion.
    Mr. Lankford. Okay. We may have some other time for other 
questions as we go from here. Let me address one thing with 
DHS, because I have a lot of very positive things and just 
ideas I want to get a chance to kick around.
    DHS had the Secure Border Initiative network. I know that 
is a long-term--that is not your favorite project to talk about 
because it was this long-term project that ended up spending a 
billion dollars and then getting folded down and saying, ``This 
didn't work,'' on it.
    That is something every agency deals with, to experiment, 
to try. Technology is always going to be out on the leading 
edge of saying, how can we accomplish that. The issue is, how 
can you--how do we integrate--well, let me rephrase it a couple 
ways. One is, it is integrating off-the-shelf technology, 
commodity IT stuff, when it is appropriate. And the second one 
is, how do we anticipate through our process of going through 
contracting to try to find areas saying, ``This is outside of 
our expertise,'' and so we don't end up with a dead-end and a 
billion-dollar debt and we don't have anything at the end.
    So, two separate projects: integrating the commodity IT 
stuff, where appropriate; and the second one is, how do head 
off a dead-end before we get there?
    Mr. Spires. That is a great example, sir, to bring up, 
SBInet. There were a lot of things that DHS did wrong early on 
that program.
    I would like to say, in the follow-on of what we are 
doing--because the concept of fixed towers with the kinds of 
surveillance equipment on those towers to monitor the southwest 
border is still a concept that the Border Patrol within CBP 
really wants. And so we are actually moving forward with a new 
program, but we are using, as you say, commodity--just not IT, 
but commodity technologies. And, in fact, we are about ready to 
go out with a request for proposal to the industry based on 
market research we have done, okay, in order to procure what we 
are calling ``non-developmental solutions,'' meaning solutions 
that already exist somewhere in the world, to be able to do 
this kind of surveillance work.
    I think that is where the government really needs to look. 
How is it that we can leverage things that already exist within 
industry or within other governments or within other agencies 
rather than, to your point, rather than going out and trying to 
build things custom? And I believe this is a good example.
    And I have worked closely with Mr. Mark Borkowski on this, 
who is the program manager of that new initiative. And we were 
both aligned, if we go with that RFP and we get something that 
is developmental in nature in any way, we are just not going to 
award. We are only going to award if it is truly non-
developmental, that exists somewhere, and that you can just 
field this thing. All right? And that I think is more what we 
need to do as a government.
    And we need to have the discipline, though, to make sure 
that we have the requirements approach. When we work with the 
business owners, we have to work with them in such a way--and 
this is part of good governance--so that they understand it is 
much better for them to perhaps give a bit on their 
requirements, okay, get 80 percent of the solution that is off 
the shelf, rather than requiring us to try to build that 
additional 20 percent custom. If you start with the 80 percent 
solution that is off the shelf and then work with the vendor 
community for existing products over time for them to upgrade 
their products to address more and more of our requirements, 
that is a much less costly and it is a much less risky approach 
to delivering IT.
    Mr. Lankford. Okay. Thank----
    Mr. Spires. Hopefully I have gotten to----
    Mr. Lankford. No, that is great. We are working on 
solutions on that.
    Let me recognize Mr. Connolly.
    Mr. Connolly. Thank you, Mr. Chairman.
    And immediately after this round of questioning, I am going 
to have to leave to go to the floor. We are going to be voting 
shortly. We have 1 hour of debate, and then we are going to 
vote.
    Welcome all, to the panel.
    And, Mr. Chairman, let me respectfully invite you again to 
consider H.R. 1713, the Federal Cost Reduction Act I introduced 
a number of months ago, to try to codify what Vivek Kundra 
started in terms of the data center consolidation and to ensure 
taxpayer savings with that consolidation. And I would love to 
have your cosponsorship, but certainly I think it might be 
timely after this hearing to hold a hearing on that, if you 
would.
    And, again, I want to thank you all for being here.
    Mr. Powner, how do you feel the data center consolidation, 
the closure and consolidation, is going? And what is your 
estimate of, in a sense, the utility savings--because I gather 
that is the lion's share of the savings from these 
consolidations--what we might expect to achieve with it?
    Mr. Powner. Well, we have had a good start on data center 
consolidation. And I know Mr. Spires chairs a committee that, 
governmentwide, that looks at this.
    A couple key things that our work has shown--and we have 
done several reviews of the data center inventories and plans. 
One, we need to ensure that we are capturing all the inventory 
out there and then have solid plans for consolidation. And the 
numbers are fine, Ranking Member Connolly, where we have X 
number of centers that we closed to date, so that is good 
progress and we have good goal of a thousand centers by 2015.
    But, ultimately, it is about saving money. So we really 
need to look at those plans in terms of when can we start 
seeing the dollar savings through those consolidation efforts. 
And that is something that we are currently reviewing for the 
Congress when we are looking at those detailed consolidation 
plans.
    So, good start, but we still need to see--the ultimate 
measure is a reduction in costs associated with these centers 
and more efficiencies going forward.
    Mr. Connolly. Right, because the efficiency and the cost 
savings was sort of the name of the game.
    Mr. Powner. That is right.
    Mr. Connolly. Do you believe we can build on that? The last 
time we had Vivek Kundra here, which was the swan song before 
this committee, he actually expressed some enthusiasm for this 
bill I referred to and actually agreed that we could do more as 
we move out to the future. Your sense of that?
    Mr. Powner. Clearly, we need to do more. I think the IT 
Reform Plan, which data center consolidation is front and 
center, there were very clear deliverables 6, 12, and 18 
months. But if you look at the data center consolidation 
initiative, that is a long-term initiative. That will go beyond 
18 months, and we need to keep the momentum beyond 18 months.
    I commend the administration for the stretch goals on the 
6, 12, and 18 months, but we need to have a plan that would go 
beyond 18 to truly achieve those cost efficiencies.
    Mr. Connolly. Yeah. Which I think means more ambitious 
numbers in terms of consolidation than even originally 
envisioned in the 25-point plan, would you agree?
    Mr. Powner. Yeah, I actually think if we would hit that 
1,000 center reduction mark we would see some great 
efficiencies with that.
    Mr. Connolly. And let me start with you, too, but invite 
your colleagues to comment. Cloud computing. It is estimated 
that--well, it is an inevitable part of the Federal future. The 
question is, how much, how fast, and how secure. And there are 
also some liability/legal questions depending on where the 
cloud is located, what company is registered, in what country, 
how our data and how other laws affect us.
    But assuming all of that, what is your sense of where we 
are headed in cloud computing for our Federal agencies? And 
what concerns might you have from a legislative point of view, 
cybersecurity for example, that ought to be on our plate?
    Mr. Powner. So, a couple things with cloud computing. 
Similar to data center consolidation, I mean, their efforts--
the IT Reform Plan calls for the major departments and agencies 
to consolidate three services to the cloud. That is a good 
start. Again, we want to consolidate those services. I think 
Mr. Locatis has a number of initiatives looking at commodity IT 
where he is looking at this. Ultimately, it is about cost 
savings, when it is all said and done. It is not about three.
    From a security perspective, a couple key things. If there 
are great security concerns, you can start with private clouds 
over public clouds. I know Mr. Spires has a number of 
initiatives where he is focused more on the private clouds, 
where you can put your security requirements in. Some of the 
initiatives at GSA with FedRAMP, that will clearly help.
    I do think security needs to be front and center when we 
move to the cloud, but between FedRAMP and some of those 
initiatives or considering the private clouds, you can address 
those security concerns and still move to the cloud.
    Mr. Connolly. Mr. Locatis?
    Mr. Locatis. Yes, we----
    Mr. Connolly. Could you speak up?
    Mr. Locatis. Oh, absolutely.
    We see this now as an opportunity for the data center 
consolidation effort to intersect the cloud offerings that are 
being offered by the private sector, private cloud offerings 
that can be FISMA-certified. And so, in our first round of data 
center consolidation, we closed three data centers. We will 
have another two data centers--we don't have the size that the 
Department of Defense has, but we are aggressively approaching 
that. And we have saved approximately $7 million through those 
data center closures.
    But now in our next round of planning, this is where we are 
looking at infrastructure as a service and working with the 
private sector through the security issues that you discussed 
to break through, working very closely with GSA on their 
sourcing capabilities, contracts, procurements, the FedRAMP and 
FISMA processes.
    Mr. Spires. I might add, sir, that we at DHS are taking a 
very aggressive approach to the cloud. As Mr. Powner noted, we 
have private cloud capability within our two enterprise data 
centers, which is our target for all of our consolidation 
initiatives, so that ties to what Mr. Locatis said as well.
    The next is between data center consolidation and 
leveraging cloud services, particularly for commodity IT. We 
are rolling out nine different cloud offerings in our private 
cloud, including such things as email as a service, development 
and test as a service, infrastructure as a service--very 
aggressive.
    On the public cloud side, we are going more slowly because 
of the security concerns at this point. We are moving our 
public-facing Web sites to the public cloud, however, because 
it is non-sensitive data, and then we are going to assess. As 
FedRAMP matures and we see that the public cloud service 
providers begin to meet FISMA low and moderate capabilities, I 
think you are going to see a much more aggressive approach by 
ourselves and by other agencies over the next 2 to 3 years.
    Mr. Connolly. I am actually--Mr. Chairman, I know I am over 
my time--but I am glad to hear that. My own feeling is that, 
actually, though it may see counterintuitive to us in the 
public sector, frankly security may be better in the private 
sector, because they live or die on their reputation and on 
their protection of data and on taking care of clients.
    And sometimes in the public sector, you know, we may have a 
bad moment in terms of a compromise, a cybersecurity 
compromise. The consequences are--you know, perhaps it affects 
your promotion, but, I mean, it is--you know, whereas in the 
private sector, literally you can go out of business if you 
screw up.
    And so I think there may be some advantages in the private 
sector, and I think the approach you have outlined makes a lot 
of sense.
    Thank you, Mr. Chairman.
    Mr. Lankford. Thank you.
    Mr. Walberg?
    Mr. Walberg. Thank you, Mr. Chairman.
    And I appreciate the ranking member's questions on that 
area and you giving latitude to continue that process, because 
that was a concern that I wanted to hear about, as well. And I 
appreciate, Mr. Spires, your response specifically as we look 
at security issues across the spectrum.
    Let me ask Mr. Spires, specifically what distinguishes--you 
know, we have seen that you have the best record of not having 
redundancies and you have done a good effort there--what 
distinguishes DHS from the other agencies in terms of its 
identification and elimination of overlapping or duplicative IT 
investments?
    Mr. Spires. Sir, I would go back to the testimony. I put a 
tremendous effort on setting up what we call these functional 
portfolios. And so, as I am sure you are well aware, within DHS 
we have 22 separate components, some very large like the Coast 
Guard and CBP and some relatively small like our health affairs 
organization. But what is interesting is that a lot of the 
functions of DHS crosscut those components.
    And what I have tried to really do as the CIO is make sure 
that we look functionally at DHS, not just vertically from the 
organizational standpoint. Because when you look functionally, 
whether we are doing screening or incident response if you were 
on the mission side or whether we are doing the business 
functions like finance and HR, you see a tremendous amount of 
duplication when you look at it from that functional 
perspective.
    So I am just a big believer, if you bring the right 
executives together in a functional area and get a dialog 
going, or a structured dialog, over time they see the 
commonality, okay, they start to recognize it, they start to 
see the advantages of working together rather than continuing 
in their stovepipes.
    Mr. Walberg. That gets them beyond the turf mentality----
    Mr. Spires. Well, I mean, this is not easy. As I said, it 
takes 3 years or so, in my experience both in the private 
sector at IRS and now at DHS, to get this to really work well, 
but it does work. And we have seen tremendous improvements.
    We are right now--in fact, screening is a great example, 
passenger screening or people screening. You know, we have six 
different components doing this screening. Okay? And we have 
systems in each of these components, all right, that are 
essentially duplicative. And now even the Deputy Secretary is 
taking this on. We are working together. We have the right type 
of governance model set up with this portfolio around screening 
to really look at, where can we consolidate, where can we 
standardize in order to eliminate this kind of duplication?
    It is a very different way of looking at an agency's 
functions. And I think in any federated kind of agency--and, 
certainly, my colleagues here are also at federated agencies--
this kind of process can work to help eliminate duplication.
    Mr. Walberg. Well, I applaud that, and may it continue and 
expand.
    And I would then move to Ms. Takai and Mr. Locatis. On the 
reverse side, with much duplication or concerns of duplication 
in your agencies, what are the causes that you have come to 
ascertain at this point in time for the duplication?
    Mr. Locatis. Well, as Richard said, he has 3 years, so we 
have really studied the Department of Homeland Security 
governance model and, in fact, implemented many of the same 
work groups and governance capabilities, including our 
Information Management Governance Council, which has 
accountability at the Under Secretary level of our three 
primary programs.
    The other thing we have done is looked at it from an 
interagency sharing perspective, where can we leverage 
capabilities in other agencies and not duplicate or reinvent 
the wheel. And it is not just in the technology areas; it is 
the investment in people, process, and technology for running 
operations. So one of those examples is, the Department of 
Energy did not create its own payroll system. It leverages the 
Defense Finance and Accounting Services' capability and buys 
those services directly from DOD versus creating our own 
capability.
    So another important piece of this is working across the 
departments to leverage shared services and not making the 
investment at all but simply subscribe to it where you have a 
center of excellence, like DFAS within DOD.
    Mr. Walberg. Ms. Takai, again, what causes for duplication 
have you addressed?
    Ms. Takai. Well, historically at DOD, our information 
technology spend was very decentralized and very focused on 
mission capability in our services and then, clearly, what was 
necessary in our forward deployed areas. And the business 
systems were also distributed from the standpoint of the 
funding and the decisionmaking process.
    So, in answer to your question in terms of what happened in 
the past to get us to this point, I think that that particular 
model really caused a sense of uniqueness in different 
organizations and then the funding to actually look at that.
    I think to the point that, you know, both Mr. Locatis and 
Mr. Spires have made, those are the things that we are working 
to really change. You know, we recognize that spending in a 
decentralized fashion, not taking a view of what our overall 
portfolio management should be, has led to the duplication that 
we have today.
    But our larger challenge is actually getting past the 
process piece, which says that we don't need to have specific 
systems that do personnel processing differently, because each 
of the services actually does do personnel processing a little 
bit differently. And so our challenge is to really be able to 
address those process issues, as well.
    The other challenge that we have is always the demand 
from--we need to have capability at the tactical edge. And I 
think back to the question, Mr. Chairman, that you asked about, 
that really then gets us into not only looking at the business 
systems piece of it but some of the forward technologies that 
you talked about and our ability to really look at different 
processes in order to be able to introduce commercial 
technology, as well as the challenges there.
    The last item I would point to is that, to the discussion 
on our ability to move forward on some of these areas and the 
way that we are addressing the cloud strategies, it is a 
challenge for us particularly across all of our networks--
classified, secret, and top-secret--to really understand the 
way forward in terms of working with our commercial partners 
from a security perspective. The ramifications for us from a 
national security perspective and making sure that our data are 
secure are significant.
    And so we are moving forward in that direction. We are 
looking to take advantage of the same things that DHS is from 
the standpoint of FISMA and then the recent FedRAMP process. 
But we are walking through that methodically, because we do 
have to be very concerned about the protection of our 
information, you know, as a national asset.
    Mr. Walberg. Thank you.
    Thank you, Mr. Chairman.
    Mr. Lankford. Thank you.
    Mr. Meehan?
    Mr. Meehan. Thank you, Mr. Chairman.
    I am grateful for the opportunity to be here this morning 
to listen to your testimony and to speak with you. I think you 
are some of the most powerful people in Washington because you 
are the folks that understand these systems, or purportedly do, 
and any institution I have ever been associated with always 
comes down to somebody saying, who understands how to get 
information out this and move it efficiently? And I appreciate 
the challenge that you have, as well.
    I know it is easy to pontificate up here, but I often 
struggled when I would have authority in the Department of 
Justice or otherwise over numerous agencies. There seemed to be 
a lot of discussion about systems, that it often went back to 
situations in which individuals had their own little turf to 
protect. And I don't know how we get beyond turf protection and 
get to the real issue of evaluating what is working.
    Mr. Spires, I particularly appreciate the work that you and 
your folks are doing. I just sat through--in my capacity not in 
Oversight but in my capacity on Homeland Security, we had the 
occasion to listen to testimony from the director. We were 
looking at budget issues. I know there are a lot of good 
efforts that are being made to create efficiencies at DHS.
    I also have the fortune of visiting within my district 
numerous businesses from time to time, and I am very pleased to 
have an industry leader, SAP, in my district. And we were 
talking, I asked him, you know, what are you really doing? And 
one of the things we spent some time talking about was some of 
the systems they have been using effectively in DHS. In 
particular, I think they are working for the Customs and Border 
Patrol. They were very proud to have had the one group that had 
a clean audit, based on going back and using that.
    Now FEMA is coming out and looking at a system. If one 
system is working, why are we looking at a new approach to try 
and have FEMA--why aren't we just taking what is working at CBP 
and using it with FEMA?
    Mr. Spires. Sir, that is a very good question. We are in a 
situation of evaluating for FEMA right now what is the best way 
forward for them for financial management. I believe the system 
you referred to at Customs and Border Patrol is their financial 
system; that is a SAP system.
    Mr. Meehan. Yeah. Yeah.
    Mr. Spires. Because of the contractual relationships that 
we have, we cannot take, for instance, the system we have at 
CBP and leverage it for enterprise use. That is a contractual 
issue, the way it was set up, sir. So we can't just use----
    Mr. Meehan. You mean we are dealing with a legacy issue, so 
to speak?
    Mr. Spires. It is a legacy--yes. The way these contracts 
were originally set up, we just cannot do that. We have wanted 
to do that, and we have not been able to.
    Mr. Meehan. Because, you know, in industries, there are 
liquidated damages for non-performance. Is there any kind of 
circumstance under which--if you are looking at a better 
system, do people go back and look at systems that aren't 
working and, therefore, have the ability to break through 
previous contract provisions for non-performance?
    Mr. Spires. Well, I don't think in this case it is an issue 
of non-performance. Okay? FEMA is looking to upgrade its 
system. It is on a legacy system that is, frankly, outdated. It 
does not provide all the functionality they need.
    We are assessing our options. As you probably are aware, we 
have gone through a number of procurements that even predate my 
tenure on trying to look at an enterprise capability for 
financial management across DHS, and we have just never been 
able to even get to an award because of protests and some legal 
issues that we ran into. I hate to say that, but that is the 
truth.
    Mr. Meehan. Well, I would be interested to hear what we can 
do to help you in that regard. Because, Ms. Takai, I would be 
interested in your observation, again. It is incredible how we 
get little bits of information from time to time and you seize 
on things, but because of my work on this committee, I am aware 
of, you know, the Air Force circumstances right now, with the 
effort.
    My recollection was--I asked my staff to look into it, and 
they did give me a little information about the Expeditionary 
Combat Support System. We are talking about a system now that, 
to my information, is--you are billions of dollars into it, 
they are coming back to us for $90 million more. Why aren't we 
looking across the board to see--there are other things working 
right here in other parts of the Department of Defense.
    And how is it that we continue to be locked into these 
silos? Is it because they are protecting their interests with 
the lawyers?
    Ms. Takai. Well, let me address the logistics question that 
you are asking, the question around logistics systems, and then 
come back to the broader question.
    First of all, the ECSS system, as it is--you know, they 
have to have an acronym or you can't be from DOD--is one of the 
logistics systems that is under a review of a set of eight 
logistics systems in the Department. And the acquisition 
technology and logistics organization is actually doing a 
review right now to look across that portfolio to say, where is 
there duplication and where can we actually look at a different 
way and a better way of doing it?
    I think, second, there are two answers to your question of 
how does this happen. One of them is that, in some cases, 
again, we do have unique requirements. So, for instance, in our 
operation, what Air Force has to do from a material logistics 
process is not necessarily the same in terms of doing 
maintenance in our man, train, and equip organizations, isn't 
exactly the same as what a TRANSCOM operation has to do in 
terms of being able to make sure that there are supply lines to 
our forward deployed troops.
    So I do think there is some terminology that are 
differences, and they are legitimate differences.
    But there is also this situation, I think to the point that 
you are making, where there are processes embedded in terms of 
the way that we do things. It may not necessarily be a single 
individual, but it certainly is a single organization. And the 
question that has to be weighed is, what is the ability of a 
large organization to make a charge, even in some fairly what 
we would consider straightforward business processes, in order 
to be able to implement standard technology versus keeping the 
processes that we have today and actually being able to use a 
more standard solution?
    It is a challenge. You know, both Mr. Locatis and I were in 
State government in several States. We saw it from a State 
government perspective, just in terms of being able to draw 
departments and agencies together. Same kind of experience in 
the private sector. And it really is around that ability to 
change from the way we are used to doing things today, the way 
that we know works, to something that is even a little 
different that may yield the same result but makes 
organizations uneasy in terms of their ability to make that 
change.
    Mr. Meehan. Well, I know I probably share the sentiments of 
my colleagues on this committee. If you have suggestions about 
things that you think would make your job easier to do to get 
to these efficiencies, I am sure that we would entertain those 
suggestions and include them in our own deliberations.
    Thank you, Mr. Chairman. I yield back.
    Mr. Lankford. Thank you.
    We are going to do a quick second round of some questions. 
As you have probably guessed, the votes have moved around 
again. They will be closer to 10:45 now. That will give us a 
little more buffer time to be able to pummel you with a few 
more questions and try to get some of this information on the 
record, as well.
    I want to follow up on a comment that Mr. Spires made 
about, we would like to take a system from over here and use it 
over here but the contract doesn't allow it. It leads me into a 
couple issues that I have on keeping contracting officers 
engaged in what technology is needed. They cannot be 
specialists in every single area that they are dealing with all 
their different contracts on.
    What are you doing to keep those contracting officers 
engaged on--a couple of things. One is to say, watching for 
when it comes down, who has the expertise in this area? Is it 
actually accurate for what we are looking for, so we are not 
having to get a system and then redo the system and go, no, 
that doesn't work and let's redo it again, and how to get 
through all that process.
    And then to be able to protect in the future in our 
contracts that if we are using it over here, we can also use it 
over here. Now, I understand these private vendors want to sell 
it in 15 different places. I get that. But within an agency, 
especially, there has to be some level of flexibility, even if 
it is to say, if we use it here and we use it over here, we pay 
you another fee but it is a smaller fee than it is over here, 
but we are not blocked out and have to start all over again 
when it is a very simple difference.
    You talked before about supply chains and financial 
management and managing human capital. Those are fairly 
consistent with minor adaptations on them. So how do we start 
developing contracts so that we can actually not reinvent the 
wheel time after time with the exact same vendor over and over 
again?
    Mr. Powner. Within DHS, I partner very closely with our 
chief procurement officer--he is a peer of mine--Mr. Nick 
Nayak. And two things that he is really taking on to address 
your very points. One, he has created a special cadre of 
contracting officers who do nothing but work closely with us 
and specialize on IT. Okay? So that doesn't make them 
technology specialists in IT, but over time they start to 
understand the complexities of helping us buy IT, right, and 
work closely with our programs. And I think that is a best 
practice that a number of other agencies are adopting, as well. 
So that is not an immediate fix, but over time it does make a 
big difference. And the individual that heads that organization 
works with us every day, okay, very, very closely.
    I would say to your other point, we are also working on 
standard contract language now that covers exactly what you 
suggested. I am amazed, I walk in here and there is a number of 
these issues where I say, we would to leverage this capability 
we have in one component in DHS in another and we can't because 
the contract does not allow us. And so we are forced back into 
having to go out in full and open competition when, if it was 
set up right in the first place, we could do exactly what you 
suggested.
    So we are putting standard contract language in. When we go 
out with these procurements, it can be at least leveraged DHS-
wide. And, in fact, we are working in the Federal CIO Council 
with OMB, can we come up with standard language that allows us 
to even issue contracts that could be leveraged by other 
agencies as well.
    So we are taking that issue on.
    Mr. Lankford. Yeah. Long term, that is obviously what is 
going to help us the most. I mean, if companies are competing, 
they are going to give us a much lower bid at the beginning, 
thinking, if I can get this and do it well, and I can also 
multiply it out, if I can get this to five other agencies and 
it would be cheaper in all those and beat all those contracts 
as well, it is to their benefit, it is to the Federal 
Government's benefit because we will get cheaper contracts all 
the way across the board as it is duplicated out.
    My concern is--and this is just interaction with some 
different guys that do programming and do some of the writing. 
Everyone who does that, especially for their own agency that 
has tapped for it, seems to have the perspective, ``They didn't 
do it as well as we would do it, and so we are not going to 
take their stuff; we are going to start all over and do our 
stuff.''
    Now, I am not saying that is an arrogance. Quite frankly, 
they are tenacious about security, they are tenacious about the 
coding and to make sure everything is correct on that, which is 
great. We need those gifts. But it also seems to lock people 
into, ``It needs to be done by me because I know us better than 
other things.'' When it is a supply chain, it is fairly 
consistent, when you give them the whole lot.
    Mr. Powner. I would just comment, and Ms. Takai really hit 
upon this issue of this idea of uniqueness, right, and how 
unique are my requirements. And I think we really need, through 
the CIO community and through the leadership of agencies--and 
this is where it gets difficult, to your point, particularly on 
these standard capabilities and what I would consider back-
office--finance and HR and others--these are very similar. 
Right? And if we can get to the 80 or 90 percent solution, we 
can get to the kind of environment you want where we are 
leveraging each other's capabilities, we are not having to 
build new. And I think we really need to take that on as a 
government.
    Mr. Lankford. Okay. Thank you.
    Let me yield to Mr. Chaffetz.
    Mr. Chaffetz. Thank you.
    And thank you, Mr. Chairman, for holding this hearing.
    My apologizes for stepping in a few minutes late. If this 
is--I hope it is not redundant, but that is sort of the theme 
of what we are talking about today, so I won't feel too bad 
about it.
    I want to start with the Department of Defense, a question 
about the Defense Finance Accounting System, or DFAS. Is there 
any progress being made with that?
    I mean, my understanding is there is a facility in Indiana, 
a lot of good people working there, a lot of good stuff, but it 
is still so manual. It really hasn't come into the 21st 
century.
    Can you give me an update on what is happening there?
    Ms. Takai. One of the challenges for us is to continue to 
move DFAS forward. And we are making significant progress in 
terms of both the utilization of the system and the system 
itself. It is going to be very critically important to us as we 
move forward on our audit readiness requirements. And so it is 
a major part of the finance portfolio that the chief management 
information officer is looking at.
    Mr. Chaffetz. And we don't have time here, but I would 
appreciate it if somebody on the staff somewhere could update 
me on where it is at and where it is going and what the 
timeframe looks like. And I am looking forward to actually 
coming and visiting that facility at some point.
    I also want to ask the Department of Defense again, we have 
been looking in my subcommittee within Oversight at the 
duplication and the problems and challenges between the 
different agencies within our departments, within DOD, on the 
health care and the sharing of that information, so that when 
somebody is actually--you know, somebody has been serving in 
the military and they are going back into their private life, 
getting those records back to their doctor sometimes will take 
in excess of a year. And I just don't understand why it is so 
complicated and why it has been so tremendously expensive.
    Ms. Takai. Well, on that particular front, I think you are 
aware that we have made considerable progress in terms of 
looking at the way forward. In fact, there is an initiative now 
which has been signed out and actually has the visibility of 
both the Secretary of the Veterans Administration as well as 
the Secretary of Defense. And they have a joint project now to 
look at a combined electronic health records----
    Mr. Chaffetz. What I can't get is a commitment as to the 
timing, as to when this is actually going to get completed. Do 
you have any idea when this is going to get completed?
    Ms. Takai. Well, we can certainly come back. I know the 
group is today working on putting all of their plans together. 
So if you will let us, we will come back to you with the detail 
on DFAS and then also with the project plan for the electronic 
health records.
    Mr. Chaffetz. I would certainly appreciate it, because it 
is such a major problem. I had an opportunity to talk to then-
Secretary Gates about this issue and the concern of the timing. 
And I was shocked at--A, I was pleased that he knew what the 
timing issue was. But to try to cut it to the timeline that he 
had talked about, which would still be over a year to get these 
records into the hands, is just unacceptable to me, and I do 
want to continue to follow up.
    Going now to the Department of Energy, there is evidently--
I had an organization, group, Energy Enterprise Solutions. And 
I don't suspect that you know about every contract, Mr. 
Locatis--is that how you pronounce it?
    Mr. Locatis. It is pronounced ``Locatis.''
    Mr. Chaffetz. ``Locatis.'' My apologies.
    They had had a performance-based contract, and there is 
some sort of dispute there. I was just hoping that you could 
give us some assurance that you would look at that personally. 
If you are willing to make that commitment, I would appreciate 
it if you would look at that contract and get personally 
involved in that, if you would be so kind.
    Mr. Locatis. I am reviewing it now.
    Mr. Chaffetz. Okay. Thank you. I do appreciate you doing 
that.
    The last thing, Mr. Chairman, I wanted to ask about--and 
stop me or let me know if this has been talked about. OMB is 
having some challenges because there are different coding 
mechanisms for accounting. And when I talk to the outside 
interest groups, you know, the people that want good, open, 
transparent government, it is very difficult to compare the 
individual data because they use different coding within 
different departments, a certain number of digits.
    Where on the radar screen, between the four of you all, is 
this? And I am sorry I didn't do a good job of articulating it, 
but where is this on your radar screens?
    Ms. Takai. Well, let me start.
    Certainly, as it relates to being able to report and work 
with OMB on the IT budget line items, we have been working very 
closely with them, because it is an issue in terms of our 
internal reporting and working with OMB. And certainly that is, 
you know, a major part.
    I think the second piece is, for us within DOD, we are 
concerned about just the overall coding and reporting for our 
effort around being audit-ready.
    So those are two efforts, certainly, for us inside DOD and 
working with OMB that have escalated the importance.
    Mr. Chaffetz. Mr. Chairman, my time has expired.
    And I will do a better job of articulating or perhaps 
putting in a letter that I would love to share with you all 
about the concern from OMB, particularly--again, this is the 
genesis coming from outside the groups that want to be able to 
compare apples to apples on line items amongst the various 
departments. You obviously represent some of the largest 
departments in our Federal Government, so I would like to 
follow up with you on that, as well.
    But I appreciate your commitment and your service. It is a 
very difficult, fast-paced sector but vital to good government 
and to making sure that they operate.
    And so I appreciate you holding this hearing, Mr. Chairman. 
Thank you.
    Mr. Lankford. Thank you.
    Ms. Takai, one last question, as well. You brought up the 
famous ``audit'' word on DOD. Where are things on that? Give us 
a timeline and progress on when it will be auditable and 
tracking.
    Ms. Takai. The Secretary has tasked us to move up the prior 
plan, which was to be ready by 2017, to be ready by the 
beginning of 2015. And so the organization has put in place a 
number of different activities and a number of different 
measurements to get there. So we are all geared up, and we are 
ready to go.
    Mr. Lankford. Terrific. I appreciate that.
    And as I have mentioned at the very beginning, on the IT 
Dashboard as well, I appreciate all that you are doing there, 
but also keeping it up to date. It is one thing to report and 
it is another thing to keep those reports up to date. And that 
is always a wonderful, I am sure, extra thing on your desk, but 
try to continue to push. There are some elements that have been 
out there that have some lower scores but they are not being 
kept up to date, and so we don't know how to be able to track 
that. And so that is important, to be able to keep that up as 
well.
    I appreciate the success stories that you are sharing. I 
hope that this also is indicative of a forum of sharing ideas 
across our Federal agencies. I am confident that you all get 
together as well, that you are establishing your own TechStat 
reviews within your own agencies and doing all those dynamics 
to try to identify some of these things. But as we identify 
this, please encourage your peers on ways of being able to 
share good ideas on how we can resolve this, as I am confident 
that you are. But as you solve some of the issues, share the 
solutions. And it is not bad to be able to brag when we are 
saving money and making things more efficient.
    So, with that, I adjourn this hearing, and we are 
concluded.
    [Whereupon, at 10:40 a.m., the subcommittee was adjourned.]

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