Information and Technology Management: Achieving Sustained and	 
Focused Governmentwide Leadership (03-APR-01, GAO-01-583T).	 
								 
The rapid pace of technological change and innovation has offered
unprecedented opportunities for both the government and 	 
commercial sectors to use information technology (IT) to improve 
operational performance, reduce costs, and enhance service	 
responsiveness to citizens and consumers. A range of issues have 
emerged about how to best manage and integrate complex		 
information technologies and management processes so that they	 
are aligned with mission goals, strategies, and objectives. While
IT can help the government provide services more efficiently and 
at lower costs, many challenges must be overcome to increase the 
government's ability to use the information resources at its	 
disposal effectively, securely, and with the best service to the 
American people. A central focal point such as a federal Chief	 
Information Officer (CIO) can serve in the essential role of	 
ensuring that attention to IT issues is sustained and improves	 
the likelihood that progress is charted and achieved. Although	 
GAO's research has found that there is no one right way to	 
establish a CIO position, critical success factors GAO found in  
leading organizations, such as aligning the position for value	 
creation, are extremely important considerations. Finally, the	 
experiences of statewide CIOs offer a rich set of experiences to 
draw on for ideas and innovation. As a result, it is critical	 
that a federal CIO, as well as agency-level CIOs, develop	 
effective working relationships with state CIOs to discuss and	 
resolve policy, funding, and common systems and technical	 
infrastructure issues.						 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-01-583T					        
    ACCNO:   A00727						        
    TITLE:   Information and Technology Management: Achieving	      
             Sustained and Focused Governmentwide Leadership                  
     DATE:   04/03/2001 
  SUBJECT:   Electronic government				 
	     Information resources management			 
	     Information technology				 
	     Chief information officers 			 

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GAO-01-583T

For Release on Delivery Expected at 10 a. m. EDT Tuesday, April 3, 2001

INFORMATION AND TECHNOLOGY MANAGEMENT

Achieving Sustained and Focused Governmentwide Leadership

Statement of David L. McClure Director, Information Technology Management
Issues Testimony

Before the Subcommittee on Technology and Procurement Policy, Committee on
Government Reform, House of Representatives

United States General Accounting Office

GAO

GAO- 01- 583T

Mr. Chairman and Members of the Subcommittee: It is a pleasure to be here to
participate in today's hearing on the various information resources
management models that state and local governments are using. You have asked
us to participate in this hearing to set the federal government context for
this hearing as it relates to the issue of the federal Chief Information
Officer (CIO).

As you know, the rapid pace of technological change and innovation has
offered unprecedented opportunities for both the government and commercial
sectors to use information technology (IT) to improve operational
performance, reduce costs, and enhance service responsiveness to citizens
and consumers. In some cases these opportunities have become reality. For
example, as we testified last year, it is increasingly common to find
federal, state, and local governments using the Internet for basic
transactional services, such as allowing citizens to submit and pay taxes,
process renewal fees, and file applications. 1 Governments are also using
the Internet to buy the goods and services that support their operations and
are establishing “portals” or integrated web sites for targeted
citizen information and services. Yet at the same time, a range of issues
have emerged about how to best manage and integrate complex information
technologies and management processes so that they are aligned with mission
goals, strategies, and objectives.

In my remarks today, I will

briefly summarize the major governmentwide IT challenges,

describe the federal government's current information resources and
technology management framework and discuss how it could be strengthened,

describe various federal CIO proposals under consideration,

provide an overview of the structure and responsibilities of existing state
CIO models, and

discuss the keys to maximizing the success of a federal CIO. 1 Electronic
Government: Federal Initiatives Are Evolving Rapidly But They Face
Significant Challenges (GAO/ T- AIMD/ GGD- 00- 179, May 22, 2000).

Page 2 GAO- 01- 583T Federal Chief Information Officer

Although the American people expect world- class public services and are
demanding more of government, the public's confidence in the government's
ability to address its demands remains all too low. The government's
successful implementation of information technology could improve this
confidence. Indeed, according to the Council for Excellence in Government,

“Electronic government can fundamentally recast the connection between
people and their government. It can make government far more responsive to
the will of the people and greatly improve transactions between them. It can
also help all of us to take a much more active part in the democratic
process.” 2 Government use of Internet- based services is broadening
and becoming more sophisticated. In particular, public sector agencies are
increasingly turning to the Internet to conduct paperless acquisitions
(electronic malls), provide interactive electronic services to the public,
and tailor or personalize information.

However, the government must still overcome several major challenges to its
cost- effective use of information technology. At the beginning of this year
we issued a series of reports- our Performance and Accountability Series-
devoted to framing the actions needed to support the transition to

a more results- oriented and accountable federal government. 3 To the extent
that the billions of dollars in planned IT expenditures can be spent more
wisely and the management of such technology improved, federal programs will
be better prepared to meet mission goals and support national priorities.
However, we identified seven continuing IT challenges that are key to
achieving this goal:

strengthening agency information security,

improving the collection, use, and dissemination of government information,

pursuing opportunities for electronic government, 2 e- Government: The Next
American Revolution (The Council for Excellence in Government). 3 Major
Management Challenges and Program Risks: A Governmentwide Perspective (GAO-
01- 241, January 2001) provides an overview of this series. The 2001
Performance and Accountability Series also contains separate reports on 21
agencies- covering each cabinet department, most major

independent agencies, and the U. S. Postal Service. The Federal

Government Faces Significant IT Challenges

Page 3 GAO- 01- 583T Federal Chief Information Officer

constructing sound enterprise architectures,

fostering mature systems acquisition, development, and operational
practices,

ensuring effective agency IT investment practices, and

developing IT human capital strategies. Until these challenges are overcome,
agencies are likely to continue to have fundamental weaknesses in their
information resources and technology management and practices, which can
negatively affect mission performance.

Since 1990, we have also periodically reported on government operations that
we have assessed as high risk because of their greater vulnerability to
waste, fraud, abuse, or mismanagement. In January of this year, in the
information resources and technology management area, we designated
information security and three agency IT modernization efforts as high risk.
4 We have reported governmentwide information security as high risk since
1997, and the three major modernization efforts since 1995.

The federal government's information resources and technology management
structure has its foundation in six laws: the Federal Records Act, the
Privacy Act of 1974, the Computer Security Act of 1987, the Paperwork
Reduction Act of 1995, 5 the Clinger- Cohen Act of 1996, and the Government
Paperwork Elimination Act of 1998. Taken together, these laws largely lay
out the information resources and technology management responsibilities of
the Office of Management and Budget (OMB), federal agencies, and other
entities, such as the National Institute of Standards and Technology.

4 High- Risk Series: An Overview (GAO/ HR- 95- 1, February 1995), High- Risk
Series: Information Management and Technology (GAO/ HR- 97- 9, February
1997), High- Risk Series: An Update (GAO/ HR99- 1, January 1999), and High-
Risk Series: An Update (GAO- 01- 263, January 2001). 5 The Paperwork
Reduction Act of 1995 revised the information resources management
responsibilities established under the Paperwork Reduction Act of 1980, as
amended in 1986. The Federal

Information Resources and Technology Management Structure

Page 4 GAO- 01- 583T Federal Chief Information Officer

In general, under the government's current legislative framework, OMB has
important responsibilities for providing direction on governmentwide
information resources and technology management and overseeing agency
activities in these areas, including analyzing major agency information
technology investments as part of the federal budget process. Among OMB's
responsibilities are

ensuring agency integration of information resources management plans,
program plans, and budgets for acquisition and use of information technology
and the efficiency and effectiveness of interagency information technology
initiatives;

developing, as part of the budget process, a mechanism for analyzing,
tracking, and evaluating the risks and results of all major capital
investments made by an executive agency for information systems; 6

directing and overseeing implementation of policy, principles, standards,
and guidelines for the dissemination of and access to public information;

encouraging agency heads to develop and use best practices in information
technology acquisition;

reviewing proposed agency information collections to minimize information
collection burdens and maximize information utility and benefit; and

developing and overseeing implementation of privacy and security policies,
principles, standards, and guidelines.

Federal departments and agencies, in turn, are accountable for the effective
and efficient development, acquisition, and use of information technology in
their organizations. For example, the Paperwork Reduction Act of 1995 and
the Clinger- Cohen Act of 1996 require agency heads, acting through agency
CIOs, to

better link their information technology planning and investment decisions
to program missions and goals;

develop and implement a sound information technology architecture; 6 This
responsibility is in addition to OMB's role in assisting the President in
reviewing agency budget submissions and compiling the President's budget, as
discussed in 31 U. S. C. Chapter 11.

Page 5 GAO- 01- 583T Federal Chief Information Officer

implement and enforce information technology management policies,
procedures, standards, and guidelines;

establish policies and procedures for ensuring that information technology
systems provide reliable, consistent, and timely financial or program
performance data; and

implement and enforce applicable policies, procedures, standards, and
guidelines on privacy, security, disclosure, and information sharing.

Another important organization in federal information resources and
technology management- the CIO Council- was established by the President in
July 1996- shortly after the enactment of the Clinger- Cohen Act.
Specifically, Executive Order 13011 established the CIO Council as the
principal interagency forum for improving agency practices on such matters
as the design, modernization, use, sharing, and performance of agency
information resources. The Council, chaired by OMB's Deputy Director for
Management with a Vice Chair selected from among its members, is tasked with
(1) developing recommendations for overall federal information technology
management policy, procedures, and standards, (2) sharing experiences,
ideas, and promising practices, (3) identifying opportunities, making
recommendations for, and sponsoring cooperation in using information
resources, (4) assessing and addressing workforce issues, (5) making
recommendations and providing advice to appropriate executive agencies and
organizations, and (6) seeking the views of various organizations. Because
it is essentially an advisory body, the CIO Council must rely on OMB's
support to see that its recommendations are implemented through federal
information management policies, procedures, and standards. With respect to
Council resources, according to its charter, OMB and the General Services
Administration are to provide support and assistance, which can be augmented
by other Council members as necessary.

The information issues confronting the government in the new Internetbased
technology environment rapidly evolve and carry significant impact for
future directions. To effectively address these issues, we believe that the
government's current information resources and technology management
framework could be strengthened by establishing a central focal point, such
as a federal CIO. Increasingly, the challenges the government faces are
multidimensional problems that cut across numerous programs, agencies, and
governmental tools. Clearly, departments and agencies should have the
primary responsibility and accountability for decisions related to IT
investments and spending Additional

Governmentwide IT Leadership Needed to Meet Challenges

Page 6 GAO- 01- 583T Federal Chief Information Officer

supporting their missions and statutory responsibilities. But governmentwide
issues need a strong catalyst to provide substantive leadership, full- time
attention, consistent direction, and priority setting for a growing agenda
of government issues, such as critical infrastructure protection and
security, e- government, and large- scale IT investments. A federal CIO
could serve as this catalyst, working in conjunction with other high- level
officials, to ensure that information resources and technology management
issues are addressed within the context of the government's highest
priorities and not in isolation from these priorities.

During the period of the legislative deliberations on the Clinger- Cohen
Act, we supported strengthened governmentwide management through the
creation of a formal CIO position for the federal government. 7 In September
2000 we also called for the Congress to consider establishing a formal CIO
position for the federal government to provide central leadership and
support. 8 As we noted, a federal CIO would bring about ways to use IT to
better serve the public, facilitate improving access to government services,
and help restore confidence in our national government. With respect to
specific responsibilities, a federal CIO could be responsible for key
functions, such as overseeing federal agency IT activities, managing
crosscutting issues, ensuring interagency coordination, serving as the
nation's chief IT spokesman internationally, and maintaining appropriate
partnerships with state, local, and tribal governments and the private
sector. A federal CIO could also participate in establishing funding
priorities, especially for crosscutting e- government initiatives, such as
the President's recently proposed e- government fund (estimated to include
$100 million over three years), which is expected to support interagency e-
government initiatives.

Consensus has not been reached within the federal community on the need for
a federal CIO. Department and agency responses to questions developed by the
Chairman and Ranking Minority Member of the Senate Committee on Governmental
Affairs regarding opinions about the need for a federal CIO found mixed
reactions. In addition, at our March 2000 Y2K Lessons Learned Summit, which
included a broad range of public and

7 Improving Government: Actions Needed to Sustain and Enhance Management
Reforms (GAO/ T- OCG- 94- 1, January 27, 1994), Government Reform: Using
Reengineering and Technology to Improve Government Performance (GAO/ T- OCG-
95- 2, February 2, 1995), and Government Reform: Legislation Would
Strengthen Federal Management of Information and Technology (GAO/ T- AIMD-
95- 205, July 25,

1995). 8 Year 2000 Computing Challenge: Lessons Learned Can Be Applied to
Other Management Challenges (GAO/ AIMD- 00- 290, September 12, 2000). No
Consensus Has

Been Reached on a Federal CIO

Page 7 GAO- 01- 583T Federal Chief Information Officer

private- sector IT managers and policymakers, some participants did not
agree or were uncertain about whether a federal CIO was needed.

Even individuals or organizations that support a federal CIO disagree on the
structure and authorities of this office. For example, as you know, the last
Congress considered two proposals to establish a federal CIO: H. R. 4670,
the Chief Information Officer of the United States Act of 2000, introduced
by Representative Turner, and H. R. 5024, the Federal Information Policy Act
of 2000, which you introduced. These bills shared a common call for central
IT leadership from a federal CIO but they differed in how the roles,
responsibilities, and authorities of the position would be established.

H. R. 5024 vested in the federal CIO the information resources and
technology management responsibilities currently assigned to OMB, as well as
oversight of related activities of the General Services Administration and
promulgation of information system standards developed by the National
Institute of Standards and Technology. On the other hand, H. R 4670
generally did not change the responsibilities of these agencies; instead, it
called on the federal CIO to advise agencies and the Director of OMB and to
consult with nonfederal entities, such as state governments and the private
sector.

Senator Lieberman also plans to introduce an e- government bill, which is
expected to include a provision establishing a federal Chief Information
Officer.

Different federal CIO approaches have also been suggested by other
organizations. For example, in February, the Council for Excellence in
Government recommended that the President (1) name an Assistant to the
President for Electronic Government with cabinet- equivalent rank, who would
chair a Public/ Private Council on Electronic Government and (2) designate
OMB's Deputy Director for Management as Deputy Director for Management and
Technology. The Council also called for the Deputy Director for Management
and Technology, in turn, to create an Office of Electronic Government and
Information Policy to be headed by a presidentially appointed, senate-
confirmed federal CIO. 9

9 e- Government: The Next American Revolution (The Council for Excellence in
Government).

Page 8 GAO- 01- 583T Federal Chief Information Officer

In March, the GartnerGroup- a private research firm- called on the President
to appoint a cabinet- level federal CIO within the Executive Office of the
President. Some key areas that the GartnerGroup stated that the federal CIO
should focus on include (1) advising the President on technology- related
public policy, (2) developing and implementing federal e- government plans,
(3) managing appropriated “seed money” for crossagency e-
government initiatives, and (4) developing standards for egovernment
interoperability and other IT- related transformation initiatives. 10

CIOs or equivalent positions exist at the state level but no single
preferred model has emerged. The specific roles, responsibilities, and
authorities assigned to the CIO or CIO- type position vary, reflecting the
needs and priorities of the particular government. However, some trends are
apparent. Namely, according to the National Association of State Information
Resource Executives (NASIRE), half the states have a CIO in place who
reports directly to the governor. (Only eight states reported such an
arrangement in a 1998 survey.) All but one of the remaining CIOs report to a
cabinet- level officer or an IT board. In addition, some state CIOs work in
conjunction with an advisory board or commission, and many of them serve as
chair of a council of agency- level CIOs. As a former president of the
National Association of State Information Resource Executives noted in prior
testimony, “IT is how business is delivered in government; therefore,
the CIO must be a party to the highest level of business decisions . . .
[and] needs to inspire the leaders to dedicate political capital to the IT
agenda.” 11

With respect to CIOs' responsibilities, according to the NASIRE, the vast
majority of states have senior executives with statewide authority for IT.
In addition, state CIOs are usually in charge of developing statewide IT
plans and approving statewide technical IT standards, budgets, personnel
classifications, salaries, and resource acquisitions, although the CIO's
authority depends on the specific needs and priorities of the governors. In
some cases, the CIO is guided by an IT advisory board.

10 Mr. President, Appoint a Federal CIO (GartnerGroup, TG- 12- 8984, March
18, 2001) and Help Wanted: Federal CIO for High- Stress, Rewarding Work
(GartnerGroup, COM- 13- 0387, March 14, 2001). 11 Testimony of Otto Doll,
President, National Association of State Information Resource Executives
before the U. S. House of Representatives, Committee on Government Reform,
Subcommittee on Government Management, Information and Technology, March 24,
2000. Statewide CIO Models

Exist But Approaches Vary

Page 9 GAO- 01- 583T Federal Chief Information Officer

Examples of the diversity in CIO structures that states reported in 2000 to
the Government Performance Project- administered by the Maxwell School of
Citizenship and Public Affairs of Syracuse University in partnership with
Governing Magazine- are as follows. 12

A model in which the CIO has a strong link to the state's highest official
is Missouri's Chief Information Officer who reports to the Governor's
office. Missouri's CIO is responsible for, among other things, IT strategic
planning and policy, IT procurement, e- government, and facilitating IT
resource sharing across agencies. The CIO is also the liaison representing
Missouri on national issues affecting IT functions of the state.

Kansas uses a model in which the CIO has multiple reporting
responsibilities, including reporting to an IT council and the Governor. The
Kansas Chief Information Officer serves as the Executive Branch Chief
Information Technology Officer reporting to the Information Technology
Executive Council, Governor and the Secretary of Administration. The Kansas
CIO (1) establishes project management standards, (2) approves bid
specifications, (3) approves IT projects over $250,000, (4) reports project
status, and (5) manages the Strategic Information Management 3- year plan.
Kansas also has Chief Information Technology Officers for its legislative
and judicial branches that also report to the Information Technology
Executive Council, as well as to the Legislative Coordinating Council and
Office of Judicial Administration, respectively.

Finally, in the model used by Michigan, the CIO reports to the head of an
executive agency- the Department of Management and Budget. The duties of the
Michigan CIO include developing a statewide information technology
architecture and standards, developing and managing a statewide
telecommunications network, and coordinating and reengineering business
processes throughout the state government.

12 Since 1996, the Maxwell School of Citizenship and Public Affairs of
Syracuse University has rated the management capacity of state governments,
based in part on state responses to a survey. The project, called the
Government Performance Project, conducts criteria- based assessments in five
areas of government management, including information technology management.
Summaries of these assessments can be found at http:// governing. com/ gpp/
gp1intro. htm.

Page 10 GAO- 01- 583T Federal Chief Information Officer

Certain key principles and success factors can provide insight into the
establishment of a successful CIO organization- including at the federal
level. In February we issued an executive guide 13 that includes a framework
of critical success factors and leading principles (see figure 1). We
developed this framework based on interviews with prominent privatesector
and state CIOs, as well as other research. Mr. Chairman, what may be of
particular interest to this Subcommittee is that CIOs of leading
organizations we interviewed described a consistent set of key principles of
information management that they believed contributed to the successful
execution of their responsibilities. These principles touch on specific
aspects of their organizational management, such as formal and informal
relationships among the CIO and others, business practices and processes,
and critical CIO functions and leadership activities. While focused on the
use of CIOs within organizations, many of the principles of the framework
are applicable to a federal CIO position.

13 Executive Guide: Maximizing the Success of Chief Information Officers,
Learning from Leading Organizations (GAO- 01- 376G, February 2001). Keys to
Maximizing

the Success of a Federal CIO

Page 11 GAO- 01- 583T Federal Chief Information Officer

Figure 1: CIO Critical Success Factors, Principles and Organizational
Relationships

Participants Collaborators

Align Information Management Leadership for Value Creation

Promote Organizational Credibility

Execute CIO Responsibilities Critical Success

Factors I. Recognize the

Role of Information Management in Creating Value

III. Ensure the Credibility of the CIO Organization

V. Organize Information Resources to Meet Business Needs Principles

II. Position the CIO for Success

IV. Measure Success and Demonstrate Results

VI. Develop Information Management Human Capital

Senior executive management, especially the CEO

CIO peers and senior management CIO organization Organizational

Foci CEO, CFO, COO Senior executives

and division heads Client and CIO

organizations CEO - Chief Executive Officer; CFO - Chief Financial Officer;
COO - Chief Operating Officer

Page 12 GAO- 01- 583T Federal Chief Information Officer

Let me explain some of the key characteristics of the six fundamental
principles described by CIOs we interviewed and important parallels that can
be made to the establishment of a federal CIO.

Recognize the Role of Information Management in Creating Value

Recognizing the business transformation potential of IT, executives of
leading organizations position their CIOs as change agents with
responsibility for applying technology to achieve major improvements in
fundamental business processes and operations. With CEO support, the CIOs
are in a good position to significantly affect not only IT, but the entire
business enterprise. Similarly, it is important that a federal CIO be
assigned a prominent role in the government's decisionmaking to create and
set a clear agenda and expectations for how information management and
information technologies can be effectively used to help improve government
operations and performance.

Position the CIO for Success

Diversities in corporate missions, structures, cultures, and capabilities
prohibit a prescriptive approach to information management leadership.
Instead, executives in leading organizations ensure that their CIO models
are consistent with the business, technical, and cultural contexts of their
enterprises. In conjunction with determining their CIO models, senior
executives of leading organizations clearly define up front the roles,
responsibilities, and accountability of their CIOs for enterprisewide
information management, better enabling their CIOs to operate effectively
within the parameters of their positions vis- ï¿½- vis those of their senior
management counterparts (i. e., CFO, COO). These senior executives also
provide their CIOs with the authority they need to effectively carry out
their diverse responsibilities.

The federal government is large, complex, and diverse. Indeed, many federal
departments and agencies easily rival in size and complexity some of our
nation's largest corporations. In addition, virtually all the results that
the federal government strives to achieve require the concerted and
coordinated efforts of two or more agencies. These are the types of issues
that are important to consider when establishing a federal CIO. For example,
while it may not be realistic for a federal CIO to have explicit
responsibility for agency IT investments, a federal CIO could be an

Page 13 GAO- 01- 583T Federal Chief Information Officer

important broker of solutions that require cross- agency cooperation and
coordination.

Ensure the Credibility of the CIO Organization

CIOs in leading organizations recognize that providing effective information
management leadership and vision is a principal means of building
credibility for their CIO positions. In addition, CIOs often outline plans
of attack or roadmaps to help guide them in effectively implementing short-
and long- term strategies. Further, CIOs participate on executive committees
and boards that provide forums for promoting and building consensus for IT
strategies and solutions. These types of responsibilities can effectively
translate to a federal CIO as well. A federal CIO can help set and
prioritize governmentwide IT goals, provide leadership for the
governmentwide CIO Council, and actively participate in other advisory
organizations, such as the CFO Council, the Procurement Executives Council,
and the President's Information Technology Advisory Committee.

Measure Success and Demonstrate Results

While there is no standardized approach to performance measurement, leading
organizations strive to understand and measure what drives and affects their
businesses and how to best evaluate results. Leading organizations use
performance measures that focus on business outcomes such as customer
satisfaction levels, service levels, and, in some instances, total requests
satisfied. In addition, to properly collect and analyze information, leading
organizations develop measurement systems that provide insight into their IT
service delivery and business processes. Establishing an information
feedback system allows organizations to link activities and functions to
business initiatives and management goals.

The Government Performance and Results Act is results- oriented legislation
that is intended to shift the focus of government decisionmaking,
management, and accountability from activities and processes to the results
and outcomes achieved by federal programs. A key role for a federal CIO
could be to help formulate consensus and direction on performance and
accountability measures pertinent to information management in the federal
government. Moreover, a federal CIO could help establish goals and measures
for major governmentwide efforts, including for the CIO Council, and create
a mechanism to report on the government's progress in meeting these goals.
This is a particularly

Page 14 GAO- 01- 583T Federal Chief Information Officer

important role since managers at the organizations we studied cautioned that
IT performance measurement is in its infancy and measurement techniques are
still evolving, partly due to changes in technology.

Organize Information Resources to Meet Business Needs

In lieu of establishing either completely centralized or decentralized CIO
organizations, leading organizations manage their information resources
through a combination of such structures. In this hybrid, the CEO assigns
central control to a corporate CIO and supporting CIO organization, while
delegating specific authority to each business unit for managing its own
unique information management requirements. This model is particularly
appropriate for the federal government since the Clinger- Cohen Act of 1996
requires executive agencies to appoint CIOs to carry out the IT management
provisions of the act and the broader information resources management
requirements of the Paperwork Reduction Act. Accordingly, a federal CIO
could help ensure overall IT policy direction and oversight for the
government, and agency CIOs would be responsible for carrying out these
policies, as appropriate for their agencies. In addition, a federal CIO
could play a role in suggesting, through formal and informal means, how the
government information resources and technology management structure should
be organized, with particular emphasis on how such a structure can achieve
cross- cutting functionally oriented government services.

Develop Information Management Human Capital

High- performance organizations have long understood the relationship
between effective “people management” and organizational
success. Accordingly, we found that leading organizations develop human
capital strategies to assess their skill bases and recruit and retain staff
who can effectively implement technology to meet business needs. Such
strategies are particularly important since studies forecast an ever-
increasing shortage of IT professionals, presenting a great challenge for
both industry and the federal government. Complicating the issue further,
serious concerns are emerging about the aging of the federal workforce, the
rise in retirement eligibility, and the effect of selected downsizing and
hiring freeze initiatives. Since human capital concerns are a governmentwide
concern, this is one area in which a federal CIO could have a tremendous
impact. Working with the Office of Personnel Management and OMB, the CIO
could explore and champion initiatives that would aid agencies in putting in
place solid IT workforce management and development strategies.

Page 15 GAO- 01- 583T Federal Chief Information Officer

In conclusion, Mr. Chairman, while information technology can help the
government provide services more efficiently and at lower costs, many
challenges must be overcome to increase the government's ability to use the
information resources at its disposal effectively, securely, and with the
best service to the American people. A central focal point such as a federal
CIO can serve in the essential role of ensuring that attention to
information technology issues is sustained and improves the likelihood that
progress is charted and achieved. Although our research has found that there
is no one right way to establish a CIO position, critical success factors we
found in leading organizations, such as aligning the position for value
creation, are extremely important considerations.

Finally, the experiences of statewide CIOs offer a rich set of experiences
to draw on for ideas and innovation. As a result, it is critical that a
federal CIO, as well as agency- level CIOs, develop effective working
relationships with state CIOs to discuss and resolve policy, funding, and
common systems and technical infrastructure issues. Such relationships are
of growing importance as public entities work to establish effective
egovernment initiatives.

Mr. Chairman, this concludes my statement. I would be pleased to respond to
any questions that you or other members of the Subcommittee may have at this
time.

For information about this testimony, please contact me at (202) 512- 6240
or by e- mail at mcclured@ gao. gov. Individuals making key contributions to
this testimony include Felipe Colon, Jr., and Linda Lambert.

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