GAO on Data Center Consolidation: Cost-Benefit Analysis and Continued OMB Leadership Required

GAO has released a report, Data Center Consoldiation: Agencies Making Progress on Efforts, but Inventories and Plans Need to Be Completed,” attached here, which emphasizes that:

it is important for OMB to continue to provide leadership and guidance, such as—as GAO previously recommended—using the consolidation task force to monitor agencies’ consolidation efforts.

GAO also emphasized the crucial role of cost-benefit analysis, an analysis that is often absent.  GAO stated:

OMB requires a master program schedule and a cost-benefit analysis (a type of cost estimate) as key requirements of agencies’ consolidation plans, but none of the five agencies GAO reviewed had a schedule or cost estimate that was fully consistent with the four selected attributes of a properly sequenced schedule (such as having identified dependencies), or the four characteristics that form the basis of a reliable cost estimate (such as being comprehensive and well-documented).

GAO also noted that:

OMB has established a standardized cost model to aid agencies in their consolidation planning efforts, but use of the model is voluntary.

GAO’s Recommendations for Executive Action are:

In addition to reiterating our prior recommendation to agencies to complete the missing elements of their inventories and plans, we are making two recommendations to OMB. Specifically, we recommend that the Director of OMB direct the Federal CIO to

•   ensure that all future revisions to the guidance on data center consolidation inventories and plans are defined in OMB memorandum and posted to the FDCCI public website in a manner consistent with the guidance published in 2010, and

•   ensure agencies utilize OMB’s Total Cost of Ownership model as a standardized planning tool across the consolidation initiative.

In addition, we recommend that the Secretaries of Agriculture, Homeland Security, Interior, Transportation, and Veterans Affairs direct their component agencies and their data center consolidation program managers to implement recognized best practices when completing required program schedules and cost-benefit analyses.

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