Top CAPEX IT Investment Areas in DoD’s Fourth Estate for FY21

By Toné Mason, Senior Analyst

We have officially made it to FY21 and my final installment about the Department of Defense’s top FY21 CAPEX investment areas. There’s nothing better to finish the series with than the Fourth Estate, or DoD non-warfighting agencies.

According to the FY21 President’s Budget Request, these agencies are on track to see a boost in CAPEX funding this fiscal year of $2.2B! Here are the programs receiving the top dollars:

(1) Department of Defense Healthcare Management System Modernization – DHMSM

With an increase of 68% over FY20, the DHMSM program is expected to receive more than $460M. This program will receive the most CAPEX funding across the entire Department of Defense – including service components.

DHMSM represents the DoD half of the modernized EHR system initiative with the Department of Veterans Affairs. The goal is to consolidate dozens of legacy systems, leading to a reduction emergency department wait times, enhanced clinical decision making and the avoidance of duplicate lab testing.

Vendors who offer technologies around workflow management, centralized data environments, AI/machine learning, software license maintenance, hardware refreshes and system hosting should evaluate getting involved.

(2) Joint Service Provider – JSP

With over $144M in FY21 expected and more than a 30% increase in funding, JSP is the program to watch. The increased funding will go towards the implementation of an updated networking solution for the Pentagon, which is looking to prioritize and route traffic based on changing network patterns.

Additionally, JSP will support the infrastructure for the Office of the Secretary of Defense, Washington Headquarters Services (WHS), Pentagon Force Protection Agency (PFPA) and the Consolidated Adjudications Facility (CAF). Technologies of interest here include: Local area networks, servers, storage, full-suite applications, customized tools and integrated system firmware.

(3) Joint Artificial Intelligence Center – JAIC

JAIC is a major program and hub tasked with leading artificial intelligence and machine learning efforts across the DoD. Created in June 2018, it is focused on rapid development of assistive technologies. With FY21 CAPEX funding of $60M, there is money to be spent in the areas of AI/ML, data infrastructure and model/algorithm testing.

Priority areas for JAIC are predictive maintenance, analysis for humanitarian assistance/disaster relief, cyber sense-making and program assessment. If your solutions align with these areas, it is worth investigating and targeting this program.

(4) Integrated Award Environment – IAE

IAE provides insight into emerging technologies that can be applied for system improvement and innovation for financial management across the DoD enterprise and is expected to receive $42.8M in funding in FY21.

Their primary focus is business analytics. Technologies that focus on information sharing, knowledge management, visualization and enterprise resource planning (ERP) will be of prime interest.

(5) DoD CIO Programs – CIO PROG

With $30.4M in CAPEX funding for FY21, CIO PROG provides policy support and oversight over the DoD information enterprise.

Priorities for the program are command and control, communications, spectrum, network operations, information systems, the joint information environment, and position, navigation and timing. If your company offers applicable solutions and you’re interested in enterprise architecture with the DoD CIO office, this is a great point of entry.


With Fourth Estate CAPEX programs seeing a spike in IT CAPEX funding, now is a good time to get involved. The future looks bright for defense-wide IT spending in FY21.


You may also be interested in reading my recent blogs:

If you need to better understand where to target your efforts in DoD, reach out to immixGroup’s Market Intelligence team to learn more.

About Toné Mason
Toné Mason is a Senior Analyst on immixGroup's Market Intelligence organization. She has a B.A. in Government and International Politics from George Mason University. Prior to joining, Toné was a Business Development Intelligence Analyst at Chenega Corporation and previously a Research Analyst at Deltek working on their GovWin product.

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