Federal Government: The Road Ahead

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Federal GovernmentThe Road Ahead

• Rishi Sood
• Vice President, Government
• Gartner
• rishi.sood_at_gartner.com

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Presentation Outline

• Market Environment
• Baseline Segmentation, Fast Facts, Procurement
• Market Issues Growth, War, Deficits,
  Instability
• Federal Key Market Issues Trends
• User Data Major Business Objectives
• User Data Key Technology Priorities
• User Data New vs. Enhancement Development
• Federal Opportunity Triangles
• Market Forecasts
• Total Federal IT Spending, 2005-2007
• Partnering Issues
• Partnering Drivers
• Key Areas For Partnering
• Conclusions

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Market Segmentation Federal
Executive-Level Agencies
Defense
Intel
Civil
4
Fast Fact Government Is...
5
The Golden Rules of Government
6
Government Acquisition Process Preparation Is
Job No. 1
Present Findings to Procurement Officer and
Political Body
Needs Identification Research
Submit Recommendations to Agency Director
New IT Project
Develop Specifications and Bid
Final Approval With Agency Director, Purchasing
and Political Body
Advertise Opportunity and Solicit Proposals
Submit Vendor Recommendation to Agency Director,
Purchasing and Political Body
Evaluate Vendor Proposals
Receive Vendor Proposals Within Procurement Rules
Select Vendor(s)
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Federal Then and Now
Then
Now

• Bush 2006 budget request includes 7 IT growth

• Congress actively resizing budgetary growth

• Vendors increasingly talking about stealing
  market share, rather than sharing an ever growing
  pie

• Vendors discuss high double digit growth rates

• MA activity on the uptick

• MA activity on the uptick

• State Local budgets are mired in a sea of red

• SLG Revenues outpace forecasts CA finds 5B in
  new monies

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Federal Priority of Major Business Objectives
Question What is the level of priority for each
of these business issues for your organization
(scale 1-7, with 7 highest priority, 1 lowest
priority)?
Outsource Noncore Processes
4.6
Reduce Operational Costs
5.8
Program Accountability
5.8
Increase Collaboration
6.2
Enterprise Focus
6.6
0.0
1.0
2.0
3.0
4.0
5.0
6.0
7.0
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Federal Key Technology Priorities
Question What are the most important technology
priorities for your organization (7 most
important, 1 least important)?
4.0
Open Source
4.4
RFID
4.4
Business Intelligence
4.5
Wireless
4.8
Biometrics
4.8
Smart Cards
5.0
CRM
5.4
Knowledge Management
6.0
ERP
6.6
Security
0
1
2
3
4
5
6
7
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Federal New vs. Enhancement
Question Are your top technology priorities
focused mainly on new development or
modernization/enhancement of existing systems?
15
Both
20
New Developments
60
Existing Modernization
0
20
40
60
80
100
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Federal Nat. Security Opportunity Triangle
12
Federal Healthcare Opportunity Triangle
13
Federal BPO Opportunity Triangle
Enterprise Focused

• Discrete/Full Service Payroll/HR
• Standardize platforms
• Emerging areas of focus

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Evolving Procurement Issues

• Consolidation and establishment of new
  procurement vehicles
• GSA Reorganization and Integrated Tech Services
• New enterprise programs (eg SmartBuy)
• Increase of performance based contracts
• Increasing focus on baseline certifications (eg
  CMMI)
• Greater/wider participation of 8A oriented
  organizations

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Federal Government Total IT Spend
In U.S. billions Source Gartner Dataquest
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Federal Vendor Landscape
Tier I Integrators
OEMs
Federal Government
VARs
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Federal Why Partner?
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Partnering RecommendationsWhat Each Side Wants
From You
Solution Providers
IT Vendors

• Tie Partnering to Tangible Opportunities
• Identify Key Agencies and Highlight Major Federal
  Themes
• Focus, Focus, Focus

• Assign Single Point of Contact
• Promote Repeatable Strategies
• Encourage Executive-Level Partnerships

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Partnering Emerging Areas
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CXO Messaging Map
Title
Key Business Issues
Technology Trends

• Transition non-governmental work to the private
  sector
• Invest in DOD, Homeland, and Intel business
  processes

• War on Terrorism
• Economic Acceleration
• Customer Centric Government

President and Congress

• Align goals with PMA/OMB objectives
• Apps that improve on operational efficiency and
  may reduce costs
• Align agencies for integrated applications

Agency Director

• Core mission and program activities
• Operational and business process redesign

• Understand commercial best practices and use of
  COTS software
• Implementation of horizontal technologies (ERP,
  CRM, Logistics, KM)
• Infrastructure modernization

• Internal Skills Shortage
• Decrease the number of siloed and legacy systems
• Create business case for new technology
  implementation

CIO
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Federal Key Influencers Map
University Research
Technology Reforms

• Harvard-Kennedy School
• Brown University
• University of Michigan
• Purdue University

• Government Performance Results Act
• Federal Acquisition Streamlining Act
• Clinger-Cohen (ITMRA)
• Federal Activities Inventory Reform Act
• Federal Acquisition Reform Act
• A-76

Govt. Organizations
Government Decision Makers

• Office of Management Budget
• General Services Administration
• General Accounting Office
• Technology Councils

Publications

• Business Commerce Daily
• Federal Computer Week
• Governing
• Government Executive
• Government Computer News
• Washington Technology

Research Firms
Industry Conferences

• Federal Sources
• Forrester
• Gartner
• IDC Corp.
• Input

• FOSE
• Gartner Symposium
• Gartner Gov. Solutions Summit

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2005 Mid-Year Assessment

• Spending Views
• STV Transition to Moderate Growth of 5 Percent
  to 7 Percent
• LTV Budget Pressure Forces Growth of Less Than 3
  Percent

• Key Technology Areas
• Agency Modernization Expertise
• Net-Centric Warfare
• Network/Telecommunications Modernization
• Intel Transformation
• Growing ERP, Logistics, Biometrics
• Emerging Sensor and VOIP

• Major Issues to Watch
• Technology Impact of Budget Deficits, Cost of War
  and Tax Cuts
• Another External Shock

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Federal GovernmentThe Road Ahead

• Rishi Sood