Finding Strategic Opportunities in Flat Federal IT Budgets

By Jessica Parks, Analyst

While federal agencies are currently making do with their FY20 budgets for IT, the end date for the current continuing resolution looms on December 11. A few agencies, such as the Department of Veterans Affairs, have requested a significant uptick in FY21 IT funding for large ongoing projects. However, for other agencies such as Treasury, Justice and Homeland Security, IT funding will remain steady or even drop a bit.

It is important to keep in mind that “steady” does not automatically equal a drop in opportunities. The mission continues regardless, and the focus is going to be on working smarter and more efficiently. Here are three focus points to consider when your customer is looking to squeeze every drop out of a flat IT budget.

1) Automation and Machine Learning Solutions

Departments across the entire federal government, both defense and civilian, are already incorporating automated solutions to make their employees’ lives easier. To work within tight budgets and (sometimes) shrinking workforces,  departments are automating business processes, parts of customer service operations and some cyber operations. The goal is not just speed, but also efficiency and accuracy.

This means that if you offer any kind of automated (or even AI-driven) solution, you will want to emphasize to your customer how your solution helps the employee. How much time does it save? By how much can the error rate be reduced? Help them justify investment in your solutions by showing how it will enhance their workforce and work processes.

2) Tech Refreshes

You don’t need to wait for a shiny new modernization or development project – tech refreshes on existing systems are another potential point of entry. For example, the Department of Justice has a refresh of much of its infrastructure planned for FY21, including BOPNet under the Bureau of Prisons, and all hardware and software under the National Crime Information Center managed by the FBI. This can be a chance for government to incorporate modern technologies that help these systems run better.

This calls for a strategic approach and deep knowledge of what is going on with your customer. Make sure you’re staying on top of not just budget priorities, but also individual projects and investments that may need your solution.

3) Interoperability With Current Solutions

No solution exists in a vacuum – IT systems demand that several different solutions and programs work together seamlessly. When budgets are tight, how well your solution plays with others becomes of utmost importance to a program manager. If they don’t have to spend precious hours trying to finagle an incompatible solution into their existing product suite, then that definitely needs to be a part of the discussion around your solution.


With certain exceptions – the budget spike at the VA for the electronic health records modernization project, for example – federal IT budgets have tended to remain flat and will likely continue to do so as we continue through FY21. Don’t assume this means a lack of opportunity, though. Keeping up with what projects your customer is working on and knowing how to speak to the time-saving benefits of your solution, will set you up for success.


Here are some of the latest FY21 on-demand webinars the immixGroup Market Intelligence team has recently released you might be interested in viewing:

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About Jessica Parks
Jessica Parks is an analyst with the Market Intelligence team at immixGroup, providing actionable analysis to help technology suppliers shorten their sales cycles. She holds a B.A. from the College of William and Mary and an M.A. in political science from UNC Chapel Hill.

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