By: Steve Vetter, Senior National Security and Federal Strategist, Cisco. Greg Lobbin, Program Manager, SAIC  

A modern Information Technology (IT) infrastructure would facilitate more cost-effective services delivery by enabling automation, providing more comprehensive performance analytics, and ensuring more efficient post-modernization run simplicity – all the while providing the most secure foundation to protect against sophisticated intrusions, adversarial actions and nation-state attacks.  

Federal  IT modernization, if done effectively and at the proper scale, should deliver “run” cost reductions of greater than 50% of existing operational spend.  Since a standard industry rule of thumb is that network “run” operational costs are often three times the cost of the network itself, targeted infrastructure modernization investments could yield substantial long-term cost savings. Most importantly, this modernized infrastructure would deliver enhanced agency and citizen outcomes and be more secure against global cyber threats. Recognizing this opportunity, the Biden Administration is advocating the launch of the “most ambitious effort ever to modernize and secure federal IT and networks” via a reinvigorated $9B Technology Modernization Fund (TMF).

As we highlighted in PSC’s 2020 Vision Forecast Conference briefing just three short months ago, the Federal Government “is an enterprise…and it’s beginning to act like it” and recent federal IT modernization  efforts are “increasingly being driven by agency mission outcome discussions.” When coupled with the maturing federal Technology Business Management (TBM) efforts, we have better data regarding federal IT spend than ever before. In addition, proven processes to identify and execute infrastructure modernization efforts exist because of more than three years of successful TMF projects.
The way the federal government works has been permanently impacted by the COVID pandemic and the “modernization of existing IT infrastructure, applications, and hardware/devices” will more securely meet the demands of the more mobile and remote workforce of today and the future. We now have robust cybersecurity frameworks and zero trust architectures to enable game-changing IT infrastructure investments more quickly and effectively than ever before. And, as we also highlighted in the Vision Forecast, “COVID-19 is creating a tipping point for rethinking and reprioritizing IT modernization and that new efforts for TMF could be a key driver” moving forward.

Tried TMF before, why will it be different now?
Since 2016, when the Obama Administration first proposed the construct of a revolving IT modernization fund, and especially over the last three years, the TMF Program Management Office (PMO) has matured its processes for modernization business case development, including both Initial and Full Project Proposals.  The TMF PMO and TMF Board have honed their technical, acquisition and oversight capabilities by overseeing 10 projects from seven different federal agencies.  In addition, successful “best practices” have been codified in a playbook from each successful project to assist other federal agencies in their modernization efforts. 

A more forceful TMF effort could be a critical cog in reversing the decade long decline in Development, Modernization and Enhancement (DME) capital funding and helping to jumpstart the modernization of substantial federal agency legacy IT infrastructures. This is critically important as PSC analysis of TBM data shows that spending on IT infrastructure across the Federal government last year exceeded $35B (across networks, end-users, data centers, security, delivery and platforms), and yet almost $12B was spent on IT management.  Modernized infrastructure includes advanced automation capabilities with simplified procedures, enabling it to be operated by a broader cross-section of federal employees and contractors. The success of Robotic Process Automation within the federal government is a great example of automation savings.  

Moving Forward
A substantially larger TMF, focused on broader, enterprise-wide investments, would not only save money but accelerate delivery of mission-oriented and security outcomes across the federal enterprise. One of the keys to achieving these outcomes rests with a change that has already been telegraphed by the Biden Administration: to change the existing TMF payback model for future disbursements potentially toward a more “grant-like” methodology, foregoing “the need of reimbursement from agencies” for at least some of the TMF-funded investments. This would encourage agencies to take on critical modernization projects now, without having to worry about the repayment impact on future budgets. In addition, TMF-based modernization could ensure that new network, end-user, data center and security infrastructure acquisitions would use more recent supply chain risk management procedures to ensure a more secure and trustworthy foundational infrastructure for the federal enterprise.

The TMF program has not been as effective as originally expected at driving critical modernization projects in federal agencies. Not only has the desired funding failed to materialize at impactful levels, the requirements around reimbursements and working capital funds have hindered broader success.  While it is not guaranteed that a $9B TMF funding request being advocated by the Biden Administration will be appropriated, TMF lessons learned over the last several years, combined with potential changes to the repayment structure, could revitalize the TMF program and provide a more substantial capital injection to help modernize federal IT and immunize ourselves from a growing cybersecurity threat.  

At publication time, the initial attempt to fund the TMF at $9B had been removed from the “American Rescue Plan” COVID-19 stimulus relief package, but our understanding is that continued efforts to include this funding would remain a priority for the Biden Administration. With only $150M appropriated for TMF over the life of the program, any substantial increase could deliver the benefits we have described in this article.

When coupled with game-changing AI/ML infrastructure and cyber technologies now available in the marketplace, a more robust TMF can help federal agencies retake the cyber “high ground” from our global adversaries.  Eliminating or reducing the federal government’s technical debt through a reinvigorated TMF could provide the necessary technical currency to more fully embrace the NIST Cybersecurity Framework principles and prioritize enterprise Federal efforts to “modernize and secure federal IT and networks” as identified in the new administration’s plans.

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Steve Vetter serves as Senior National Security and Federal Strategist for Cisco. Steve has been active in PSC for over a decade, including co-chairing the IT Management and Budget and NASA Vision Forecast Conference teams.

Greg Lobbin is a Program Manager at SAIC in the Homeland & Justice Group. Greg has been active in PSC for the past five years, including co-chairing the IT Management and Budget team (ITMB).