Sunday, August 26, 2012

GAO: Faulty Estimates for Outsourcing Typical for Govt IT Projects

Nicole Blake Johnson at the Federal Times has a recent article about a pervasive problem with government outsourcing - GAO: Cost estimates are typically faulty on major IT projects

“It is alarming to discover that, despite past cost overruns and failed IT projects, agencies still have not put in place effective cost estimate policies. The time for a dramatic improvement in acquisition planning is now." -Senator Susan Collins, R-Maine.

A new audit, focusing on major technology projects, revealed a widespread deficiency in managers' ability to properly estimate costs. According to the July report conducted by the U.S. Government Accountability Office (GAO), fifteen of the sixteen IT projects, worth a combined 52 billion dollars, are using inaccurate cost estimates.

Most of these agencies fail to utilize the best practices in cost estimation. Many do not require employee training in cost estimation. Furthermore, most agencies lack an independent team responsible for accurately estimating costs. By implementing these simple methods, agencies can take the requisite step in the right direction to ensure more reliable cost estimation.

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