Chris Wiedemann

Federal Opportunity Alert: BI & Reporting Needs at OMB & GSA

June 3, 2013 Leave a comment

by Chris Wiedemann, Analyst

If you’ve been following the progress of the Federal Data Center Consolidation Initiative (FDCCI), you might have seen a recent GAO report that contained some mixed messages about the program’s progress.

First, the good news: according to the report, agencies have already closed around 420 data centers, with another 968 planned for closure by December 2015. This will put the government 285 closures short of the original target for consolidation set by OMB – still, when compared to other large initiatives in federal IT, FDCCI looks more or less on schedule.

However, significant obstacles to tracking FDCCI progress still remain. Most notably, OMB and the GSA Program Management Office have not been tracking actual cost savings caused by data center closures, which calls into question their ability to demonstrate $3 billion in savings by 2015 – another key milestone of the original data center consolidation mandate. In fact, the latest memo on the topic did not mention a cost savings goal, which further reflects the difficulty of quantifying FDCCI savings. This could open the door for business intelligence vendors, particularly those with tools that can analyze and report on large amounts of data. If you have the tools to help GSA and OMB demonstrate cost savings through FDCCI, you’re likely to find a receptive audience right now.

Filed under Market Intelligence Tagged with data center consolidation, GAO, gsa, OMB

Federal Opportunity Alert: Cybersecurity Weaknesses at the Department of Transportation

May 13, 2013 Leave a comment

by Chris Wiedemann, Analyst

If you’ve been following our blog lately, you will have noticed a heavy focus on cybersecurity coming out of the government at a very high level, as mentioned by both Steve and Tom in the last few weeks. It’s not surprising that federal executives at the highest levels are dedicating renewed energy to this topic – there have been a number of high-profile and successful cyber attacks against federal systems lately. However, while attempts to solve sweeping issues at the level of legislation and executive policy are admirable, the fact remains that many (possibly all) government departments and agencies have real issues at the ground level that contribute to government-wide vulnerabilities. The good news for us is that many of those issues can be solved with COTS security technology.

To illustrate the point, let’s take a look at the Department of Transportation (DOT), which handles the fifth-largest civilian IT budget at a little over $3 billion. Although the department is best known for the NextGen program at the Federal Aviation Administration (FAA), it also handles a huge infrastructure – all of which needs to be secured. According to an Inspector General (IG) report from November, however, there are real deficiencies across DOT’s security posture, which can largely be described in three categories:

DOT networks are not sufficiently covered for the purpose of detecting and reporting incidents to the Department of Homeland Security (DHS);
Reported incidents are not remediated properly;
Configuration baselines and configuration changes are not appropriately managed.

That last point is particularly serious. In fact, the IG report went on to estimate that only 63% of DOT computers were compliant with departmental security policies. In other words, there is a real configuration management challenge being faced here, and it represents an area of priority for DOT cybersecurity personnel. The department is also severely delayed in terms of response to identified incidents, and it still trying to determine how many medium-risk vulnerabilities are present in its security architecture, which makes DOT a great target for vulnerability assessment & remediation. Finally, continuous monitoring tools are a big requirement. Now that the continuing resolution is in place and agencies finally know how much money they have to spend for the rest of the fiscal year, we expect to see movement on quickly addressing some of these issues, both at DOT and in other departments.

Filed under Market Intelligence, Sales Tagged with cybersecurity

Federal Opportunity Alert: IRS Affordable Care Act Administration

April 15, 2013 Leave a comment

by Chris Wiedemann, Analyst

As Stephanie mentioned in her post last week, the Patient Protection and Affordable Care Act (PPACA) has created substantial new regulatory burdens for the Department of Health and Human Services. However, expanded mission requirements are not limited to that department – unsurprisingly for such a large piece of legislation, regulatory and enforcement authority rests in several different places across government. Outside of HHS, however, the single largest instance of new regulatory authority resides with the Internal Revenue Service.

For evidence of the size and scope of IRS’s involvement with the Affordable Care Act (ACA), look no further than the Treasury’s section in the Exhibit 53. The second largest investment there, referred to simply as “Affordable Care Act Administration,” is in fact a $300M bucket of new Development, Modernization & Enhancement money intended to stand up an entirely new system to support IRS’s increased data collection and tax enforcement requirements. Although the investment is still in the early planning stages, the bureau has already started contracting out program management and development services to prime holders of the TIPSS 4 contract. As we enter the home stretch of this fiscal year and move into FY14, be on the lookout for a wide range of commercial off the shelf requirements coming out of IRS to support this investment, including data management, business intelligence, fraud & waste detection, and cyber security requirements.

To learn more about the IRS’s ACA Administration investment, as well as other key initiatives and programs in the Treasury, be sure to register for immixGroup’s upcoming Market Intelligence Briefing on April 24 at 11:00 am ET.

Filed under Market Intelligence

Shielding Yourself from Sequestration

March 22, 2013 1 Comment

by Chris Wiedemann, Analyst

If you had a chance to view immixGroup’s Market Intelligence briefing on sequestration yesterday, you hopefully have a better understanding of what the proposed cuts mean to IT companies. Tim Larkins summarized the history of this situation – what sequestration is, when it became law, and just how those cuts (which weren’t really supposed to happen) actually arrived. He also covered some of the projected long-term impacts of sequestration on federal spending. This information is all vital – it will help you understand your customers’ pain and better equip you to discuss the cuts they’re experiencing.

Today, though, I want to take a minute to reemphasize some of the key components of Tim’s presentation: what does this mean for federal sales? The “snowquester” is actually a pretty good metaphor for the impact of these spending cuts on the federal IT market: some segments will stay pretty dry, while others may well get buried. So what should we be doing to shield ourselves from sequestration?

First and foremost, when you’re finalizing a deal with your customer, make sure the money is there. That means asking your customers two questions: what activity account is funding the purchase, and is the right amount of money in that account? Remember, while program people are creating demand, they have to request that money be transferred from Treasury into the right activity account before they can actually buy anything. This is the step where the sequestration cuts are actually taking place – think of them as a leak in the cash pipe. That leak could mean that money intended to purchase your products is actually getting lost before it ever lands in the right activity account. Don’t forget: unless you and your customer both know 1) which account is funding a purchase, and 2) whether that account contains the right amount of money, you’re subjecting yourself to potential delays and hang-ups down the road. You might even not get paid.

A few more points that I want to emphasize:

Although the long-term impacts of these deficit cuts will probably be minimal, we are going to feel the pinch in the short term. Federal IT spending will decrease overall this year, particularly in DOD, where they have been spending as though the sequester would not be implemented.
Most of the cuts to IT spending will probably be felt by systems integrators and services contractors, both large and small. All the language coming out of OMB and other government sources indicates that there are many duplicative or otherwise unnecessary IT services contracts that will probably be descoped (or cancelled outright). This is bad news for small business subs on large contracts, but is actually good news for the COTS community, since government will need to buy more tools to perform the tasks that they used to outsource.
Keep your audience in mind. At the executive level, demonstrating cost savings and value is going to be more critical than ever – if you can’t demonstrate real ROI within two years of purchase, your customer likely won’t be interested.
At the end of the day, there is still a mission that has to be met, and government customers won’t be able to use sequestration as an excuse not to do their jobs. If you or your clients can help them meet that mission, you will still find a willing audience.

As always, if you have more specific questions, I urge you to reach out to the Market Intelligence team. Good luck and happy hunting.

Filed under Market Intelligence, Marketing, Sales Tagged with budget, federal, federal sales, government marketing, immixGroup, market intelligence, restriction, sequestration, spending cuts

Federal Opportunity Alert: Business Intelligence to Fuel USDA Strategic Sourcing

March 1, 2013 Leave a comment

by Chris Wiedemann, Analyst

Speaking at an AFCEA Bethesda breakfast panel on shared services and strategic sourcing this morning, Lisa Wilusz, Director of USDA’s Office of Procurement and Property Management, identified a glaring lack in the Department’s efforts to streamline procurement for commodity products: they don’t know what they already have. Without getting into too many specifics, she mentioned a medium-sized USDA subagency that had hundreds, if not thousands, of duplicative purchasing agreements in place for wireless equipment – in fact, consolidating all those agreements down is one of the signature accomplishments of the strategic sourcing initiative in the Department.

While achieving that type of consolidation is a feel-good story for agency personnel, it points to a fairly glaring weakness: USDA’s procurement staff is lacking some of the basic data points that would make their jobs easier. For example, Wilusz specifically mentioned not knowing how many software licenses the Department holds, or whether they could avoid buying software that they already have. All of this translates to opportunity for IT product vendors with business intelligence or asset visibility tools to sell.

Filed under Market Intelligence, Sales

10% IT Cuts Mean More Opportunity, Not Less

August 28, 2012 Leave a comment

by Chris Wiedemann, Analyst

Despite constant uncertainty and doubt around the federal budget in recent years, there has always been one prediction that the technology community could make with confidence: federal IT budgets remain consistent. In fact, over the last five years, and in the face of ever increasing mission requirements, agency CIOs have been working with mostly flat budgets. While not ideal – ask any customer how much they enjoy being told to “do more with less” – budgetary landscapes were at least easy to predict, and purchasing decisions could be made with a fair degree of certainty about overall appropriations.

That relatively stable environment appears to finally be changing, and (at least on the surface) changing for the worse. Barring the passage of eleventh-hour legislation, sequestration will see all federal agencies subjected to across-the-board budget cuts, and IT will certainly feel the squeeze. On top of that, federal CIO Steve Van Roekel recently pushed out a memo stating that all federal agencies would be required to report a 10% reduction in their top line IT budgets by FY14. With the dual pressure of sequestration and a further mandated IT budget reduction, not to mention the difficulties of meeting constantly expanding requirements with already stretched budgets, many members of government and industry have been left thinking the worst.

Fortunately, the situation is not as dire as it appears. Recent OMB guidance goes into more detail about that 10% IT budget reduction, and the message it brings should be heartening to IT product vendors: the primary targets for IT spending cuts will be duplicative commodity investments and underperforming projects. Moreover, agencies will have the authority to reinvest money saved into consolidation efforts and high-priority programs. In fact, they will be required to reinvest at least half of the money they cut, with priority given to areas such as consolidation of commodity IT, cybersecurity improvements, data analytics, and cloud computing. In other words, that 10% figure isn’t going to disappear; instead, it will represent big opportunities for the IT product community to demonstrate superior ROI to government customers.

Filed under Market Intelligence

Federal Cybersecurity: The More Things Change, The More They Stay The Same?

June 6, 2012 Leave a comment

by Chris Wiedemann, Analyst

In the federal space, some areas of cybersecurity have evolved while others remain frustratingly stagnant. On the technological front, particularly within the Pentagon, the demand for new technologies like data encryption for mobile devices can only increase as DOD cybersecurity shifts to meet the demands of an increasingly net-centric defense enterprise.

The pace of technological change is not being matched by legislative change. Bills regulating certain critical networks and officially granting broad cyber authority to DHS have stalled again and again due to privacy concerns and fears of over-regulation stifling innovation. As a result, OMB plans to take executive action, proposing amendments to the decade-old A-130, particularly the cybersecurity appendix.

Meanwhile, the need for robust security services around federal IT systems continues to be made apparent by domestic and foreign cyber incidents. The new “Flame” malware exhibits a broad range of malicious capability and serves as a Stuxnet-like reminder of the rapidity with which extremely advanced cyber threats can manifest. On a more basic level, the possible attack of internal NASA websites by a group of Iranian students, even if proven false, has pointed out basic gaps in the agency’s internal security posture. In other words, the need for seemingly basic security policies and products remains. At the same time, budgetary pressures and a general lack of qualified cyber security staff are leaving agencies scrambling to contract cybersecurity services, often at a premium.

What does this mean for cybersecurity product vendors? Simply that the need for security technology figures to remain constant, possibly even increasing in the face of reduced IT budgets across the government. More importantly, any product that can come to the aid of overburdened agency IT security staffs should find a willing audience – be on the lookout for opportunities around automating IA staff functions.

Filed under Market Intelligence

Data Rich but Information Poor: Federal Sales Opportunities Around the Big Data Revolution

April 16, 2012 1 Comment

by Chris Wiedemann, Analyst

The last five years have seen an explosion of data generation within the federal government. Everything from expanded C4ISR capabilities, to electronic health records, to growing cybersecurity capabilities across the board are creating data growth at almost exponential rates. Perversely, even the Federal Data Center Consolidation Initiative (FDCCI) is — you guessed it — generating more data. While FDCCI is attempting to answer the question of where all that new information rests (not to mention the problem of storage costs running somewhere between three and ten times as high as data generation costs), you might be left asking another question: What, exactly, are they doing with all of it?

Well, as it turns out, the government isn’t sure themselves. As David McClure, Deputy Director of GSA’s Office of Citizen Services and Innovative Technology, put it at a recent AFCEA Bethesda big data symposium, government is data rich but information poor. Especially in the new world of budgetary constraint and spending reductions, agencies are feeling the pressure to take the vast amount of information they suddenly have access to and use it to get smarter – after all, you can’t do “more with less” if you don’t know exactly what you’re doing with what you have. Participants at the symposium drove home the message that the government is looking to move toward real-time, observational intelligence; instead of creating reports and analyses after the fact, they want to crunch data as it comes in and identify trends faster.

What does that mean for the IT product community?

The big data revolution has government customers paying attention, and, with increased pressure to deliver improved results with less money, analytics and intelligence will be critical to the government moving forward.
While more traditional areas of data analytics and business intelligence – e.g. reporting/dashboards, visualization, ad-hoc searches etc. – will still be in demand, the real areas of growth are expected to be in forecasting, data mining, and other similar tools that can operate on a real-time basis.
No matter who your government customer is, odds are they are dealing with more information than ever before. If you can show them how to use it better, they’re sure to listen.